Competition is the core of which a company grows to its advancement, without competition , an organization can stagnate even at its lowest level, but with the advent of what we call Supply Chain Management, a company struggles to its best refinement when it comes to its business dealings.
Supply Chain Management as discussed from previous article means managing the flow of goods from raw material, production, inventory and distribution of finished products. It has been proven and tested positive that having a good supply chain management results to a competitive advantage of a company. As all have known a good supply chain management takes a good ride in any leadership role in a business by way of thinking effective strategies on the buying process.
Then how do we assess offers from suppliers? What are the criteria to be made? And what should be the basis of evaluating supplier’s proposals? The act of purchase does not begin and end with the basis of who gives the lowest price. Proper documents must be submitted by qualified suppliers about their company and their product as well as papers regarding bids. At this point, a company must be very ardent on the quality of the product of each supplier before they are allowed to enter into biddings for reasons that even on the onset of bidding all entries must have the best quality of raw materials to present.
Assessments does not only ends there, the course of transfer, shelf life and other procedure involve must be considered and put into papers. Proper documentations of the bidder must be well thought-out too. Potential suppliers must prepare bid documents also.
Quality is the main objective of a company, whether a supplier gives out the lowest price, it shall not be taken as an advantage, again, everything must be scrutinized before a supplier is allowed to bid. Lower price of raw materials very so often means jeopardizing the quality of the end product.
It is everything but normal that suppliers goes through biddings to assess competitive offerings. Procurements of products does not merely exist through transacting and buying directly, most often and if not everything goes through a process of bidding, selecting qualified bidders or suppliers becomes an important activity of a company, they use this method in accordance with a specific criteria.
To help you out with how to assess suppliers, a company must consider the following factors: competency, commitment, cost, cleanliness and communication.
Competency- this involves a supplier’s capacity of knowing his product well, also evaluation of a supplier’s ability to provide, support.
Commitment- this second factor is about the capability of a supplier to guarantee a prompt delivery of raw materials.
Cost- implies how a supplier cost his materials at a very reasonable price and that both the supplier level and the company will be both in a win win situation.
Cleanliness- does a supplier practice proper sanitation around its surroundings or even on the handling of raw materials. This factor is usually applied particularly on raw materials like farm produce that is needed for food processing.
Communication- does suppliers speedily respond to a company’s request, calls or letters. Communication greatly plays a major role in business.
Utmost this are the factors needed to assess a supplier, but there are still lots of things that are not mentioned that are very essential to assessing competitive offerings from the suppliers. Now that we already know the bird’s eye view of how to assess competitive offers from supplier, it would be already easy to work things out during procurements of raw materials.