Written by Marijn Overvest | Reviewed by Sjoerd Goedhart
Fact Checked by Ruud Emonds | Our editorial policy
Supplier Evaluation Form — Everything You Should Know
Key take-aways
- A supplier evaluation form is a tool or document used by businesses and organizations to initiate the supplier evaluation process.
- Supplier evaluation forms are not always questionnaires, they can be scorecards or done face-to-face through discussions.
- The supplier evaluation is a part of the RFP process wherein proposals from suppliers are submitted to test suitability.
A supplier evaluation form is one of the few things that is a key instrument when it comes to the procurement process, mainly the RFP process. The RFP process is in the early stages of the procurement process, and thus, making sure it goes smoothly will yield great results.
This article will discuss the entire purpose of a supplier evaluation form and how it is integrated into the procurement process, as well as the advantages it can give by utilizing it.
After this article, you will have a better insight into how you can utilize a supplier evaluation form and make use of it to streamline your procurement process.
I have created a free-to-download editable supplier relationship management scorecard template. It’s a PowerPoint file that can help you evaluate your supplier’s performance effectively. I even created a video where I’ll explain how you can use this template.
What is a Supplier Evaluation Form?
Supplier evaluation is the process of evaluating and assessing suppliers and their products or services to analyze whether they meet your organization’s metrics, criteria, or specifications.
On the other hand, a supplier evaluation form is a tool or document used by businesses and organizations to initiate the supplier evaluation process. It rates the performance and sustainability of the potential suppliers and is and should be a typical part of the procurement process.
The form enables your organization to gather information about everything a potential supplier can offer such as their products, services, pricing, quality, and even their sustainability and capabilities. Organizations can utilize this information to rate, evaluate, assess, and compare it to their specifications and criteria to look for the best supplier aligned with the organization’s goals and have the capability to provide the organization’s specifications.
Request for Proposal
RFP or request for proposal is the procurement phase where you create documents as part of an announcement that you, the procurement manager, intend to create a project or task that requires the procurement or sourcing of important services or products.
Now, maybe you’re wondering, what is the relationship between RFP and Supplier Evaluation? Well, supplier evaluation is a part of the RFP process. The RFP process is mainly about requesting proposals from suppliers about what they can offer and how they can fit your organization’s procurement process. Supplier evaluation is the act itself of evaluating those proposals when you have received them.
Additionally, RFP is the phase where the organization might receive many different bids and proposals from many different suppliers. In this case, utilizing supplier evaluation is the best way you can use to make sure that you find the best supplier who participated in the bidding process and is aligned with the organization’s goals and specifications.
How to Evaluate Suppliers
It’s important to ask yourself a few questions once you’ve received quotes from suppliers.
First, make sure you receive answers to all your questions in the Request for Proposals from every supplier. Look for clear inclusion of this item in the tender, for example, when you request a description of lifetime costs.
Secondly, the extent to which you have been supplied with information is in question. A short answer to the questions posed in the request for proposals may be provided by some suppliers.
Lastly, consider that the contents of the proposal have been clearly stated. Do all the elements of a quote seem to have been well understood by different experts? If you do not respond to any of these questions, additional information should be requested from the supplier concerned.
If a provider does not provide sufficient answers to questions, you should be aware that this is often not the result of coincidence. They may intentionally omit or provide limited information on areas where they are not well-positioned to meet the specified criteria.
Whether a supplier will be allowed to provide additional information, and when, depends on factors like the number of bids received, the likelihood of the supplier being a serious candidate, the existing relationship with the supplier, and the customary practices within your organization.
It is now your turn to check whether the proposals and bids satisfy our knockout criteria after you answer these questions in your mind. The knockout criterion is the most important requirement, which must be fulfilled by all offers. If an offer does not comply with that criterion, the lack of this requirement cannot be matched by any additional aspect of the offer.
Contentsof Supplier Evaluation Form
To evaluate supplier and their proposals, we should have a supplier evaluation form ready so that we can input the supplier’s information and proposals.
Here are examples of contents that are usually a common element of a supplier evaluation form:
1. General Supplier Information
Basic data on the supplier, such as their name, address, contact details, and any relevant certificates or accreditations shall also be included.
2. Supplier Background and Experience
The history, experience, and expertise of the supplier shall be covered in this section. It may inquire about their years in business, key clients, references, and other relevant qualifications.
3. Products and Service Quality
The quality of the products or services supplied by the supplier shall be assessed in this section. It may ask for measures to control quality, observance of industry standards, accreditations, or any other previous issues related to quality.
4. Delivery Times
The ability of the provider to meet delivery deadlines and lead times will be assessed in this aspect. Questions concerning their order fulfillment procedures, transport methods, and any guarantees or sanctions relating to delays in delivery can be included.
5. Pricing and Financial Stability
The price structure of the supplier, payment terms, and total Financial Stability shall be examined in this section. It may examine their pricing competitiveness, payment options, credit terms, and any other indicators of financial health or risk.
6. Customer Service and Support
This is done to assess the responsiveness, communication, and support mechanisms of the supplier. Questions relating to availability, response times, complaints handling processes, and overall customer satisfaction may be included in this report.
7. Ethical and Sustainability Considerations
A supplier’s commitment to ethical business practices, social responsibilities, and the sustainability of the environment is assessed in this section. Their policies on working conditions, environmental impacts, compliance with laws, and any relevant certificate or initiatives may be examined by the Commission.
Typesof Supplier Evaluation Form
There are several methods of evaluating a supplier. It varies from organization and what’s best for them. Here are several methods of supplier evaluation:
1. Scorecards
For each of the evaluation criteria, scorecards may be developed with a numeric rating system. For you to compare suppliers, this means that your data about each vendor can be measured.
2. Discussions
Informal discussions are an opportunity for leaders and teams who know the products to discuss their options. The discussions can help all of the team members to take a decision about which factors are most relevant when selecting suppliers, as each member may have their own priorities such as cost or convenience.
3. Questionnaires
Questionnaires provide more qualitative data, e.g. quality and communications efficiency, can be obtained by means of questionnaires. In order to clarify some of their procedures, you could also provide the suppliers with questions.
4. Supplier visits
In order to gain an understanding of the business and its production processes, certain undertakings visit suppliers at their premises. It will allow you to get familiar with senior staff and take note of the supplier environment.
SoftwareAvailable to Manage Supplier Evaluation Form
To support your management of supplier evaluation forms, there are now many software and tools you can use. Here are the top 5 softwares available for you to use:
1. Coupa
Coupa offers a feature specifically designed for creating and managing job orders. It provides workflows, document management, and reporting functions for procurement needs.
3. Tradogram
Tradogram is a top-rated e-procurement software solution that helps businesses manage their procurement process from end to end. It includes supplier management, contract management, and spending analysis.
4. Kissflow
Kissflow is a cloud-based procurement software tool that helps businesses manage their procurement process from requisition to payment. It includes supplier management, contract management, and spending analysis.
5. Whatfix
Whatfix is a cloud-based procurement software tool that helps businesses manage their procurement process from requisition to payment. It includes supplier management, contract management, and spending analysis.
Conclusion
Supplier evaluation is the process of assessing suppliers and their products to see if they meet your company’s key metrics, criteria, and other specifications. Moreover, a supplier evaluation form is a document that is used as a tool to initiate the supplier evaluation process.
Furthermore, everything from your supplier’s information to their ethical and sustainability considerations should be included in the supplier evaluation form so that you would not miss anything that may hinder a smooth-flowing collaboration. However, do keep in mind that evaluating them can be done in multiple ways like giving out scorecards, discussing with them personally, or sending out questionnaires for a more qualitative approach.
Nonetheless, it gets the job done, especially when you use software that is more centralized and equipped to streamline the entire evaluation process, and is an important factor to assess whether or not your suppliers are great to collaborate with in a longer period of time.
Frequentlyasked questions
What is supplier evaluation?
Supplier evaluation is the process of evaluating and assessing suppliers and their products or services to analyze whether they meet your organization’s metrics, criteria, or specifications.
What is the supplier evaluation form?
A supplier evaluation form is a tool or document used by businesses and organizations to initiate the supplier evaluation process. It rates the performance and sustainability of the potential suppliers and is and should be a typical part of the procurement process.
How to evaluate suppliers?
Evaluating suppliers should be done by setting criteria and metrics as well as questions that will make you gain information on whether a supplier’s capabilities, products, and services is aligned with what your organization needs.
About the author
My name is Marijn Overvest, I’m the founder of Procurement Tactics. I have a deep passion for procurement, and I’ve upskilled over 200 procurement teams from all over the world. When I’m not working, I love running and cycling.
