The supplier selection process is a critical activity within the operations of a company. Once the outsourcing decision is taken, a process aimed at analyzing and choosing the appropriate suppliers begins.
Suppose that you are a Procurement Analyst in a large company. You have been asked to prepare a proposal to the Chief Procurement Officer identifying the best supplier to outsource, for a 3-year period, a complex part of your company’s value chain. Your company operates in a mature market where the qualifying and winning factors are quality and time to customer respectively.
Based on the information included in the table, address the following questions:
What supplier would you select?
What is your rationale for your election?
What supplier would you select if your company’s factors changed to price and quality? Would your election change?
*Figures are expressed in % as follows:
Price: price quoted by supplier vs. outsourcing company target price
Quality: parts accepted vs. parts delivered
Delivery: parts delivered on time vs. parts delivered
As the Procurement Analyst, prepare a proposal that outlines the issues of the case, states your choice of supplier and provides a rationale for your choice.