The ability to conduct an effective RFx evaluation is one of the key responsibilities of any professional procurement role. In the past, buying meant focusing on the lowest cost option and then passing supplier dealings onto other team members. But in modern procurement, the buyer has a much more hands on role in supplier evaluations and understanding how they can best perform these is crucial for success.
Here are 6 useful tips to consider when performing your next supplier evaluation:
- Consistency Is Key
Don’t mix things up when working through a certain RFx. Keep the evaluation criteria and even the team the same throughout to ensure consistency. This way you can be transparent with the supplier what is being evaluated and show that the evaluation of all suppliers is fair.
- Be Clear On The Objectives
Objectives are what shape the evaluation, so it’s vital that yourself and your team understand what is to be achieved by the RFx. To ensure people always have a fresh idea of these objectives, it’s worthwhile keeping the original business case or specification around for reference throughout the evaluation.
- Don’t Be Tempted By Price Alone
Although cost will have a role to play in your evaluation, it’s easy to get hypnotised by a tempting price and overlook other weaknesses in the submission. Be sure to evaluate every aspect of the supplier’s offerings to ensure they meet your requirements in all areas, particularly the more important ones specified in the objectives.
- Know What ‘Value For Money’ Means For You
The term ‘value for money’ is very commonly used in procurement, particularly in the public sector. However, the actual definition of this varies vastly from project to project. You need to understand, based on the objectives of your evaluation, what ‘value for money’ means on this occasion and communicate this clearly to your team.
It could be based on areas including but not restricted to; quality, delivery, innovation, risk and standard of submission.
- Technology Can Aid Your Decision
There are various templates out there on the web that can aid in supplier evaluation. You simply use the scores you have given for each section (and add any weighting if relevant) and it will generate a final result. This is not only very quick and hassle-free, it also can help to demonstrate that the decision process is fair.
- Always Let Bidders Know The Outcome, Good Or Bad
It’s important that you communicate the decision to all suppliers who submitted a bid, even the ones you didn’t chose. Be transparent about how the decision was made and give constructive feedback about their bid, even if it wasn’t successful. This will help to maintain a good relationship in case you chose to use the supplier in future and also helps them to see where they need to improve.
What tips would you offer to help procurement professionals to improve their supplier evaluations? Share them with us in the comments or tweet us @Procure_Supply.