Eight methods of supplier management

01 Select alternative suppliers

The number of alternative suppliers should be larger. These alternative suppliers can be discovered by the purchasing company itself, or they can be self-recommended by the suppliers or introduced by others. These alternative suppliers should be reviewed as required and those alternative suppliers that do not meet the requirements should be eliminated.

02 Qualification investigation of alternative suppliers

For alternative suppliers, the purchasing company should conduct a qualification investigation.

03 Sample trial production and confirmation

Before selecting a supplier, the purchasing company should also ask the supplier to trial produce samples. If the sample is unqualified, it will not be approved; if the sample is qualified, it will be approved.

04 Price Negotiation

After the sample is qualified, the purchasing company should conduct price negotiation with the supplier. Suppliers that are valued too high will not be used and will still be considered as alternatives; suppliers that are valued too low may not be able to guarantee product quality or may cut corners. Therefore, choose a supplier with reasonable prices.

05 Trial order

Since the credit relationship between the supplier and the purchaser has not yet been established, in order to test the various supply capabilities of the supplier, a trial order should be made at this time. . Before placing a trial order, various transaction conditions (price, quality, delivery date, packaging, transportation, acceptance, etc.) should be clarified with the supplier as a basis for evaluating the supplier.

06 Delivery Acceptance

After the supplier accepts the trial order, it should complete the production of the product on time and handle the delivery matters in a timely manner. The purchasing company will arrange a dedicated person for acceptance. Some purchasing companies have stricter regulations, stipulating that the goods must be accepted at the supplier's place. After the acceptance is passed, the supplier is allowed to send people to the purchasing company for delivery. Acceptance is subject to all trading conditions.

07 Performance Appraisal

The delivery acceptance process is actually the process in which the supplier accepts performance appraisal. Only those with outstanding performance can become official suppliers. The focus of performance appraisal is on the supplier's fulfillment of all transaction conditions.

08 Formal Order

After the alternative supplier becomes a formal supplier, the purchasing company should sign a formal order with it.

Of course, some purchasing companies have relatively strict management and will strictly inspect suppliers again, that is, place trial orders again, and formal orders will only be signed after all indicators meet the standards again.