Helping professionals manage the procurement process
In the simplest form, a subcontract is a purchase order written with more explicit terms and conditions. Its complexity and management varies in direct proportion to the value and size of the job. The management of a subcontract may require unique skills and abilities because of the amount and type of correspondence, charts, performance reviews and management reporting which are necessary.
RFQ31 – Subcontractor performance template will help you audit and record performance
What comes to mind when you think of a Vendor . . . a coin-operated snack dispenser, a sidewalk food service, or perhaps someone selling flowers or handmade jewelry on the corner? In fact, these are all vendors, as well as the local bakery, the service station or corner store, and the door-to-door vacuum salesperson. Read on to get our definition of a vendor as it relates to purchasing.
A Vendor is defined as a company which supplies parts, materials or services to another company or individual, also referred to as a supplier. This includes all companies that you do business with and help you bring your project to completion or provide you with a service to help you accomplish your tasks. They may provide uniforms or a cleaning service, prepare payroll, accounting or financial statements, deliver office/shop supplies, produce graphic layouts or manufacture tools, parts and equipment, provide transportation of goods or international relations assistance. Some Vendors you may deal with on a daily, weekly or monthly basis others you may do business with only once a year.
Vendors can and do many things which can make your business successful. These are the persons that introduce us to new products and services to improve productivity, they can offer advice or recommendations to help address a current need or fulfill a requirement. They can be an excellent resource when researching solutions to an unfamiliar request and help keep our product knowledge current.
In this post we have touched on a wide range of various vendor types. RFQPro’s main focus is on vendors which warrant performing a Vendor Performance Review or Supplier Evaluation on. Our focus is on the strategic vendors vital to an organization’s long-term viability. Their products and services support businesses, regardless of industry.
You’re not going to worry too much about the vendor that sells you a hot dog or that cup of Joe, but if you are a purchasing manager, then you work for a company that likely has many vital vendor relationships. These vendors help your business remain profitable, they are paid by your company, and they make money from your business or orders.
So, our definition of a Vendor is one that is, in fact, a partner in our business. They are within the top 20% of all suppliers we do business (spend) with, and warrant spending hundreds, if not thousands, of dollars auditing, evaluating and providing feedback to on an annual basis. RFQPro has a first-rate Vendor Performance Review (RFQ30), available in both our Premium Pack and our Performance Pack. We are also the group behind the RFQ Software which has a built in Supplier Evaluation Tool. This on-line vendor performance tool is part of the Pro Version subscription of our RFQ Software.
Note: Our Software Business sold in 2024.
The evaluation of suppliers is a continuing purchasing task. Supplier performance shifts over time. Markets change, costs fluctuate, quality drifts, and relationships evolve. A one‑time evaluation can’t capture any of that. Continuous evaluation helps organizations:
Current suppliers should be monitored to see if they are meeting expectations. New sources need to be screened to see if their potential warrants serious consideration for future business. This post will focus on evaluating current major suppliers which are important to the success of your own operation.
Types of Evaluations
Informal evaluations have there place in smaller organizations and for the most part are all that is required. It involves verbal discussions with other user groups in your organization to determine how the vendor is doing and when relevant, relaying feedback to suppliers.
Executive Round Table evaluations are just what is implied. It is an annual face to face discussion between top level management personnel in the purchaser’s organization and those of the vendor. These meetings are limited to key or major vendors and the presence of top executives lends weight to the occasion and permits discussion of past performance, future expectations, and commercial or economic aspects in a high-level context. For the most part, they take place on the purchaser’s premises.
Obviously, the number of these types of meetings must be limited, as there is a cost attached to gathering personnel.
Formal Vendor Evaluations
Purchasing departments need to subject their key vendors to an annual performance evaluation. Many suppliers appreciate the opportunity to address shortcomings and to improve service levels. Smart vendors approach major buyers as partners, want to please clients and forge long term relationships which are beneficial to both parties.
Evaluating a key vendor involves a review of quality, price, delivery and service elements. We suggest you discuss service levels with user groups, warehouse / receiving departments, accounting and purchasing. Other departments can provide valuable feedback on invoicing issues, short shipments, damaged goods and if they are receiving quality technical support.
RFQ30 is a sample vendor performance report which has a detailed rating scheme, including weights for form of measurement. It is one of the most comprehensive evaluation forms in the marketplace and it is available in our Premium and Mega Pack bundles.
Click the image to enlarge or preview a portion of this 14 page template.
Sample Supplier Evaluation Form Detailed Preview
Note: Different product classes require different factors, weights and measures to reflect their varying impact on the organization.
The value in this single template more than covers the purchase price of the complete template pack and remember we have a 100% Satisfaction Guarantee, so buy with confidence. Available in our Premium and Mega Packs.