Vendor Selection Process
The vendor selection process can be a very complicated and emotional undertaking if you don’t know how to approach it from the very start. Lack of effort, poor planning or taking shortcuts will serious jeopardize the success of the vendor selection process. When you opt for the lowest bidder without undertaking a complete vendor selection process and you do not have the right vendor, you will soon experience bad customer support, poor quality of missed delivery dates. Going through all the phases of a vendor selection process can ensure success in your venture. The first step towards selecting a potential vendor/supplier is to analyze business requirements. After the task of searching and selecting a prospective vendor/supplier, you must develop a contract negotiation strategy to avoid contract negotiation mistakes. Here are five steps to help you choose the right vendor/supplier. Analyze the Business Requirements:
It is important to first analyze your business needs before you even begin to search for a vendor/supplier. Assemble a vendor selection and evaluation team who would be given the responsibility of finding a suitable vendor. Discuss with your management and vendor selection team about what the company wants to procure. Define in writing, the service or product that the company wants. Once the company has finalized the product or service, define the business and technical requirements and then decide on the requirements that the prospective vendor should have. Ask the management team to analyze all the requirements and create a final document stating your business and vendor requirements. For products and services that affect small areas, a small team of three to five people will be sufficient. For larger products and services that affect several (or maybe the entire company), five to ten people may be required. More than 10 people may become unmanageable. Search for a Vendor:
With clearly defined business requirement, the...
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