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What is the basic criteria for supplier selection?

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Question added by Fekede Getachew , Executive supply chain , Cadila pharmaceuticals (Ethiopia)PLC
Date Posted: 2015/08/18
Lawrence Fernandes
by Lawrence Fernandes , Procurement Officer , Creative Ship Maintenance Engineering LLC

Competitive pricing, quality & delivery timelines.

Ajay Kumar Thallapalem
by Ajay Kumar Thallapalem , Assiatant Manager , The Waterbase Ltd.,

The basic criteria for a supplier is : Quality and cost

Md Fazlur Rahman
by Md Fazlur Rahman , Procurement Specialist , Engineering and Planning Consultants Ltd

Supplier Selection, if I understood correctly, it is pre-qualification of suppliers to bid so that we get bids from competent suppliers. For pre-qualification of suppliers, the following criteria may be followed in brief:

1.       Regulatory compliance i.e. The entity  must be registered  as a “supplier” or “Manufacturer” with competent department of the state or country, having valid trade license and other regulatory compliance document  like VAT Registration certificate, Income tax clearance certificate etc.

2.       Physical facilities: Must have manufacturing facility, storage facility and an office address.

3.       Technical Competence: Must have technical  personnel  and skill or have contractual agreement  with competent technical personnel or other firms for manufacturing the product

4.       Financial Solvency: The Firm must be on sound financial standing as evidenced from the Bank solvency certificate issued by their Banker and audited financial statements (or at least Bank Statement for the last three years).

5.       Experience: The Firm must have previous experience in similar jobs, which is to be substantiated by experience certificate from other organizations

6.       Management Quality: Please verify rigorously who are behind the entity and their background.

The above noted criteria are applicable in case of manufacturing or civil works or highly big value procurement projects.  For only trading business, it is not necessary to have manufacturing /storage facility. Technical capacity and Management quality may be relaxed to some extent. 

 

Supplier Selection is critical issue and shall be done on rigorous analysis. Final outcome of the bidding process and actual delivery of goods /services in right time will solely depend on reliable supplier selection.

MUSTAFIZUR RAHMAN
by MUSTAFIZUR RAHMAN , Senior Merchandiser , Ultimate Fashions Limited.

1. Quality of product2. Comparative price3. Maintaining lead time4. After sales service5. Capacity considering uncertain demand6. Payment method7. Delivery mode

Myrna Ashraf Mattar
by Myrna Ashraf Mattar , Product Manager , Pelcro

that he would fulfill my critirea whether its quality or cost - aslo a win win strategy will be followed3-Safety Guaranteed

Nadeem Asghar
by Nadeem Asghar , Supply Chain Consultant/Trainer , Independent Practitioner

The process of evaluating a manufacturer/vendor is complex and is based on multiple criteria. However, the following four are the most important.

 

Product And Process Technologies

Quality

Capacity

Service Reliability

There are many aspects which require collection of information and closer examination while determining a suppliers/manufacturers qualification and eligibility to ensure successful completion of contract. These interalia may include:

Quality of material supplied and quality control regime

Timely deliveries

Litigation history

Complaint handling

Payment by the supplier to vendors of Raw Material

 

Involvement in corrupt practices or otherwise

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