Supplier Performance Evaluation

The main objective of the supplier evaluation process is to reduce purchase risk and maximize the overall value of the purchaser. It typically involves evaluating, at a minimum, supplier quality, cost competitiveness, potential delivery performance and technological capability. Some of the other criteria used in the preliminary evaluation of suppliers include financial risk analysis, evaluation of previous performance, and evaluation of supplier provided information.

Source: Monczka, R., Trent, R., & Handfield, R. (1998). Purchasing and Supply Chain Management. Cincinnati, OH: South Western College Publishing.