Supplier Evaluation 

Setting up a whole-scale purchasing control system is based on the transfer of our customers' requirements to our suppliers. 

The evaluation of suppliers means a planful information collection for the selection of new, and control of the existing suppliers. It should ensure a steady long-term quality of the supplier, if he is interested in fault elimination.     

The target group of suppliers, who are being evaluated, has been selected on the basis of the purchase value during the last period, or with regard to the strategic importance of the supplier.  

Evaluation Criterium

The supplier evaluation is carried out once a year, according to the following criteria:

1. Quality Evaluation

The quality evaluation includes three criteria:

• A. Quality of the products supplied – number of claims vs. the number of supplies    
• B. Covering documentation enclosed    
• C. Responsiveness to complaints – the evaluation is influenced by the supplier's responsiveness, and his active cooperation in complaint solving.  Criteria for point assignment 

2. Logistics 

• A. Meeting desired delivery dates  – supplier's capability to meet the delivery requirements as to the quality required, delivery date and quantities agreed.  
• B. Response to demand – proposal preparation within the time agreed.
• C. Meeting ecological requirements – the supplier has the standard ISO14001, i.e. he meets the ecological requirements without exerting any negative influence on the environment.

3. Payment Conditions

• A. Price, that should be easily provable with a comparative analysis of the competitors' offers. 
• B. Time limit for payment
• C. Cost lowering incentives – a number of points will be assigned in accordance with the supplier's suggestions regarding the lowering of logistical costs, suggestions for replacement of materials, and suchlike. 

4. Technical Support

• A. Existing technical support – providing technical support as to the products degree of difficulty, timely performance of changes, and   additions in the product manufacturing process by request of the purchasing department. 
• B. Readiness to cooperate within the product development phase – the supplier is ready to cooperate in the product development phase and in production of the first prototype samples.

Supplier Ranking

Depending on degree of fulfilment of the requirements, the suppliers shall be ranked in the following groups:    

• SUPPLIER-PARTNER can be a supplier, who fulfills within the observation period the quality as well as other requirements from the evaluation criteria.    
• RELIABLE SUPPLIER is that one who, to a large extent, fulfills our requirements. Periodical problems, which appear, the supplier eliminates systematically, and within the time limits agreed. 
• APROVED SUPPLIER satisfactorily fulfills our quality requirements, weak points are noticed. The supplier is interested in cooperation, and demonstrates his readiness for advancement within the rank group of suppliers.    
• CONDITIONAL SUPPLIER does not fulfill the requirements. He repeatedly causes problems that bring about additional costs.    

Each supplier will receive his evaluation and on the basis of it prepare his suggestion for corrective and preventive measures to be adjusted with the purchasing department, and a scheduled plan for its realization.  Fault elimination should be ensured within a reasonable deadline (as to the problem's degree of difficulty).     

Supplier Satisfaction

The partnership relation can be established by observing the buyer's requirements as well by considering the supplier's observations.   

With intention to achieve a good business cooperation, and with desire to eliminate the faults which are disturbing for our suppliers, we have prepared a short questionnaire for suppliers. By analyzing the questionnaires we shall acquire information on your satisfaction in cooperating with us. In that way we shall find out where we can improve the work process, and what we can additionally offer to the supplier to make him fulfill our requirements with satisfaction.