the vendors selection criteria

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In new organizations, the supply chain mechanism is more complicated than in the past. The responsibilities have shifted, and the tasks now dictate the firm's competitiveness. It is critical to choose the most suitable supplier that will provide the business with benefits that will help it meet strategic targets such as a high return on investment and shareholder wealth maximization. Based on the sector in which it works, each company is unique. When choosing a supplier, factors such as expense, reliability, and credit terms are critical because they decide the firm's future status. They should, therefore, use selection criteria that will pick the most appropriate distributor who will not affect the normal operation of the business. The departments are dependent on one another failure by the supply chain process may affect other departments for instance finance when scheduling and making payments. Consultation is necessary to enhance the efficiency of operations in the business.

Keywords: Consultation, efficiency, flexibility, selection criteria, wealth maximization,

Vendors selection criteria


The business operates in a volatile environment that is affected by changes that take place within and those that are beyond the control of the operations. When implementing strategies external factors, for instance, competition and price should be considered as they determine the future position and profitability of the firm.

Role of selection criteria

Selection criteria are used when determining the appropriate supplier for the business. It gives the company an opportunity to evaluate the providers and also select the most favorable according to the needs and expectation of the organization. Consideration of the criteria elements is essential as it minimizes the risk and any uncertainties that may arise disrupting the normal operations (HITT, 2011). The study will evaluate the subway a chain of first food restaurants.

Criteria recommendation


Unpredictable demand patterns often characterize business operating in the hospitality industry. When selecting a supplier, they should not select those who individually operate at fixed schedules as they may have a stock out. They should have a vendor that is ready to distribute goods whenever in need. I would consider the element as the most important because the inputs determine the quality of outputs. The outputs will influence the revenue and profitability of the firm (Mousavi Hekmati & Khoshlafz, 2017). Subway uses the criteria in the selection of the suppliers it is a key factor in the business as it has increased the efficiency of the operations and customer satisfaction.

Criteria elements


Consideration should be given to the supplier who can offer a variety of services. It increases the chance of negotiating for better deals such as discounts and credit terms. The supplier and the business will also maintain healthy long-term relationships that will improve trust and maintain confidential information that may expose them to competitors making them an easy target (Mousavi Hekmati & Khoshlafz, 2017). It reduces the work load of the personnel within the organizations as they keep accounts and records of few suppliers.


The goods distributed should be in good condition. The supplier should guarantee the firm that they have adequate resources for instance means of transport that will ensure they are in an appropriate state. It determines the quality of the output a key factor in influencing demand.


The price list often includes prices, but the supplier should be flexible in adjusting the prices. Discounts will be substantial as they reduce the total cost and therefore increasing the profits. The goal of a firm is to maximize the profits and minimize the cost.

The business terms.

The terms of payment are significant as they determine the amount of working capital available in the firm. In the case of insufficient money, the business may not be able to pay the suppliers in time, and it may affect the operations.

Years in business.

If the company has been in business for long, there is a high chance it will meet the expectations of the customer (Chopra & Meindl, 2016). It has adequate resources and therefore can supply the goods according to the expectations of the firm.


The supplier selection criteria elements are crucial in organizations. They determine the quality of services the business can offer by distributing goods in time that are essential in the production process. They are, therefore, relevant in determining the output and also the profitability of the business. The company should select the criteria that are suitable for their type of industry.


Hitt, M. (2011). Relevance of strategic management theory and research for supply chain management. Journal Of Supply Chain Management, 47(1), 9-13.

Mousavi Hekmati, S., & Khoshlafz, M. (2017). The role of quality in supply chain management in development of brand equity. Uncertain Supply Chain Management, 71-76.

Chopra, S., & Meindl, P. (2016). Supply chain management. Boston, Mass. [u.a.]: Pearson.

November 17, 2022

Economics Business


Workforce Corporations

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