Supplier selection

What is the importance of supplier selection?

Supplier selection is important as the aim is to choose the best supplier that offers value for money and can deliver your organisations needs efficiently. There is a growing need for an effective supplier relationship as this results in increased cooperation over a long time that helps to mitigate risk and increase benefits for both parties. Look below to see why supplier selection is so important:

• An appropriate supplier selection process provides a unique way of ensuring consistency among suppliers
• You’ll be able to identify the most suitable supplier through evaluation and a set criteria
• The chosen supplier will be equipped with your organisations aims and objectives
• Supplier selection helps to reinforce feedback and trust

Who is responsible for the supplier selection process?

The procurement team must work with stakeholders to specify what goods and services are required. It's then down to procuremnt to source the market and find suppliers to invite to tender. Key stakeholders within the organisation should then be involved in the tender analysis or final selection of suppliers to the meet the needs of the business.

What are the three most important criteria for selecting suppliers?

Selecting the right supplier for your organisation is important. There are many things you should consider during the selection process, but the most important things are listed below.

• Value for money: Value for money doesn’t mean cheap. You’ll have to strike a balance between cost and value for money and work out how much you are willing to pay.
• Quality: The end goal is for the customer to be happy and if the products or services are poor quality, your brand reputation will be on the line. Make sure that potential suppliers have the right tools, skills and capacity to produce quality products.
• Reliability: You need to ensure your supplier is reliable. Late deliveries or poor-quality goods can lead to unhappy customers. Whichever supplier you select, ensure that there is consistent communication throughout the process which will help you identify any problems that may arise.