Chapter 8:

SUPPLIER IDENTIFICATION
AND EVALUATION
(SUPPLY CHAIN MANAGEMENT)
Learning Objectives:
At the end of this chapter, you should be able to:

1. determine the different concepts and principles in

supplier selection and evaluation;

2. identify the criteria for appraising suppliers in terms of

the supply targets; and

3. apply the different supplier evaluation criteria in

assessing the supply chain operation in the hospitality
industry.
Selection and Evaluation Process in Supply Chain
Management
1. Acknowledge the need for
supplier sourcing

7. Contract/Agreement signing 2. Determine criteria for supplier

with the selected supplier sourcing

6. Evaluate and select the 3. Identify sources of potential

supplier suppliers

5. Determine methodology to 4. Shortlist the suppliers from

assess and evaluate suppliers selection pool

Figure 10. Selection and Evaluation Process Model (Ho, 2009)

 SUPPLIERS SELECTION CRITERIA

1. Process and Design Capabilities

-suppliers can include up-to-date and competent components, as
well as the process technology needed to produce the required content
2. Quality and Reliability
-component quality must adhere to specified standards on a daily
basis
3. Cost
-product unit price is not often the most important factor to consider
when selecting a supplier, the total cost of ownership is
4. Service
-suppliers must equipped to provide outstanding service in the
event that is needed
5. Capacity
-the organization’s commitment to meet expectations, as well as the
provider’s capacity to handle large requests could be investigated
6. Location
-which affects delivery times, transportation costs, and logistics
costs
7. Management Capability
-a set of behaviors applied by leaders in critical situations.
8. Financial Condition and Cost Structure
-these considerations are critical in determining whether or not the
supplier will be a reliable source of supply and whether or not supply
would be disrupted
9. Planning and Control System
-these are systems that release, coordinate and track the flow of
work within an organization as well as with external parties
10. Environmental Regulation Compliance
-the willingness of a supplier to conform the environmental
requirements
11. Willingness to share Technologies and Information
-can help with new product design and development
12. Longer-term Relationship Potential
-an organization can decide to form a long term relationship with a
prospective supplier
13. Supplier Selection Scorecards
-during the procurement process, organizations can have systematic
of assessing alternative suppliers
-a supplier preference scorecard can be used as a decision-making
tool
 SUPPLIER EVALUATION
- with the aim of ensuring that you have a supplier(s) who can
conduct or tender to the required requirements
- the process of assessing and approving potential suppliers through
quantitative and qualitative assessments.
- there are two items to consider when it comes to dealing with
suppliers:
1. Supplier pre-qualification which happens during the pre-
contract assessment phase;
2. Supplier performance which occurs during the post-
contractual evaluation time.
Rey Carter
- created the 10C’s Concepts of Supplier Evaluation

1. Capability or Competence
- it is the duty of the supplier to handle the proposal or tender in an
informed and competent way
2. Capacity
-you must understand whether the supplier can meet existing and
future supply needs
3. Commitment
-this depends on whether you want a long-term arrangement
4. Control System
-you can discover that the changes in the consumer economy cause
your vendors to adjust as well
5. Cash
-examine your suppliers financial health, including their working
capital
6. Consistency
-the manufacturer might have procedures in place to ensure
consistency
-inquire about the supplier’s plan and if required order a
presentation and a test sample
7. Cost
-this had to do with their commodity prices as well as other aspects of
the actual cost of ownership
8. Culture
-in this stage you can ensure that the supplier’s business standards are
compatible with yours
9. Compliance with Environment
-it is an important element in meeting demands and maintaining a
long-term relationships
10. Communication
-suppliers with advanced information and communication technology
programs are the ones you can depend on to react rapidly anytime you
need assistance or have a supply chain concern
 By: Group 6
MAQUINANO, SARAH V.
MENDOZA, ERICSON
OPINIANO, JELYN N.
OLEDAN, SARAH S.
ORBETA, RUSSEL JAY

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