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Types of Supplier Metrics

Most of the metrics previously discussed can also be used for suppliers.  In addition, the following categories can also be used for performance evaluation and measurement of suppliers.Enter your text here…

Financial Metrics

  • Financial strength, stability, profitability
  • Projections for the future
  • Equitable sharing of financial savings

Supply Chain Metrics

  • Supply chain response time to changes and requests
  • Performance of vendor-managed-inventory (VMI)
  • On-time delivery performance
  • Supplier cycle times
  • Total cost of doing business
  • Cost reduction ideas

Quality Metrics

  • Accurate shipments
  • Product quality
  • Continuous improvement process in place
  • Costs of non-conformance
  • Accurate billing

Sustainability Metrics

Please refer to the metrics for sustainability covered earlier.

Relationship Metrics

It is not just the effort of cost-effective purchasing that determines the value-add component of procurement, but the relationship between the buyer and seller as well. Examples of metrics include:

  • Willingness to work through challenges and problems
  • Responsiveness to concerns and needs
  • Timely communication
  • Reliability in meeting commitments
  • Participation in Supplier Resource Management (SRM) program
  • Willingness to negotiate
  • New product development support
  • Participation in supplier certification program
  • Quality of information sharing
  • Conformance to contracts

Metrics for Service Organizations

Many of the metrics previously mentioned are also applicable to the suppliers of service organizations.  In addition, some specific measures for service firms include:

  • On-time appointments
  • On-time completion of service
  • Timely confirmation of orders and callbacks
  • Professionalism of employees
  • Skill levels
  • Customized service capabilities
  • Amount and quality of contact with customer
  • Knowledge of customer requirements
  • Overall customer satisfaction
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