The Procurement Glossary » Supplier Selection

Supplier Selection

Sourcing & RFx

Definition

The decision process of choosing which supplier (or suppliers) to award business to after evaluating bids or proposals.

Explanation

Supplier selection weighs price against quality, capacity, reliability, risk and strategic fit, usually via weighted scoring. Good selection is documented and defensible, showing the evaluation criteria and how each supplier scored.

Example

After scoring four proposals on price, lead time and quality, the buyer selects the second-cheapest supplier because its lead time is half the cheapest's.

Related terms

• Evaluation Criteria — The defined factors — and their relative weights — used to score and compare supplier bids or proposals.
• Weighted Scoring — An evaluation method that multiplies each supplier's score on a criterion by that criterion's weight, then sums the results into a single comparable total.
• Supplier Prequalification — The process of screening suppliers against minimum requirements before inviting them to bid, to ensure only capable, compliant suppliers compete.
• Sourcing — The upstream procurement activity of finding, evaluating and selecting the suppliers a business will buy from.

Frequently Asked Questions

What is Supplier Selection?

The decision process of choosing which supplier (or suppliers) to award business to after evaluating bids or proposals. Supplier selection weighs price against quality, capacity, reliability, risk and strategic fit, usually via weighted scoring. Good selection is documented and defensible, showing the evaluation criteria and how each supplier scored.

Can you give an example of Supplier Selection?

After scoring four proposals on price, lead time and quality, the buyer selects the second-cheapest supplier because its lead time is half the cheapest's.

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