The Procurement Glossary » Supplier Development

Supplier Development

Suppliers & Vendors

Definition

Working actively with a supplier to build its capability, quality or capacity for mutual benefit.

Explanation

Rather than switching away from a weak but promising supplier, development invests in improving it — training, process help, joint projects. It suits strategic relationships and markets with few alternatives.

Example

The buyer funds lean-process training for a key supplier, cutting its defect rate and the buyer's inspection cost.

Related terms

• Supplier Relationship Management (SRM) — A strategic approach to managing key supplier relationships to unlock mutual value beyond price.
• Corrective Action Request (CAR) — A formal request asking a supplier to investigate a problem, fix its root cause and prevent recurrence.
• Strategic Supplier — A supplier critical to the business — by spend, risk or capability — that warrants a close, managed relationship.
• Supplier Collaboration — Working jointly with suppliers on shared goals such as cost reduction, innovation, quality or forecasting.

Frequently Asked Questions

What is Supplier Development?

Working actively with a supplier to build its capability, quality or capacity for mutual benefit. Rather than switching away from a weak but promising supplier, development invests in improving it — training, process help, joint projects. It suits strategic relationships and markets with few alternatives.

Can you give an example of Supplier Development?

The buyer funds lean-process training for a key supplier, cutting its defect rate and the buyer's inspection cost.

Back to the procurement glossary | Procurement concepts | Contact us