Selecting and Evaluating Suppliers

Several characteristics exist with which one can evaluate and select potential suppliers. Traditionally, cost, quality, and service were the three main criteria for supplier selection. Today, there are many more to consider  

To help narrow the selection and evaluation criteria and the list of potential supplier candidates, it helps understand the degree of interfirm collaboration that is required. The level of interfirm collaboration dictates the type of suppler relationship needed. Where firms reside on the relationship continuum depends on who the end customer is, what they expect, and the type of product or service being provided. 

Interfirm collaboration can run from an arm s length transaction all the way to vertical integration. Interfirm collaboration can also include several points in between these two extremes including partnerships, strategic alliances, and joint ventures. The need 

No matter what the relationship or the selection and evaluation criteria, the overarching goal is to select suppliers and partners who will help the firm compete, retain customers, and generate sales. 

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To manage the supplier network effectively, it is important to learn how to select and evaluate suppliers, determine and use an appropriate number of suitable suppliers, and manage the relationships that come from using various suppliers. 

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