Advantages of Vendor Rating

Following are some of the import advantages of vendor rating : 

1. An efficient vendor rating system saves both time and money of the Galatians as well as provides the best value for money for the organisation. 
2. It brings objectivity and transparency to the procurement process and thus, accusations of nepotism, outpourings, corruption and false propaganda is reduced. 
3. The company acquires m image of being fair not just with vendors but also the business community as a whole. 
4. It helps in rating the vendor as a whole instead of having a tunnel vision. Aspects regarding know how. testing, transport, contractual willingness, R&D efforts are all included for evaluation. 
5. It helps improve relations with the better performing vendors by giving them due recognition. 
6. It inculcates a competitive spirit among the vendors and helps improve the quality of products, services and the organisation. 
7. It helps distribute business optimally between vendors. 
8. Decisions to disqualify, blacklist or discriminate between vendors can be taken objectively. 
9. Vendor rating helps organisations to get an idea as to how they outperform their competitors regarding price, lead time, service, split-shipment, technical assistance, and adhoc requirements etc. 

Needless to say, the vendor rating system requires periodic updating. It should not be too frequent as to take away resources and also not be so infrequent that the data is not representative. It is imperative to keep the vendors informed of the system and its advantages and disadvantages. Their belief in the system is crucial for the system to work. Erhical considerations, however, demand that other vendor details are not revealed to all vendors and the secrecy is respected.