Vendor Rating Methods

Based on above factors, a large number of rating methods are available. Vendor rating plans rely heavily on the judgement and experience of the decision maker(s). The systems are non-quantitative and should preferably be done by an evaluation committee to prevent "judgmental swings". Depending on performance, a vendor is given a plus point, neutral or minus point. The performance trends over time are plotted and the vendor with more 'pluses' is chosen. The system is successful if the vendor is kept notified of his good and bad performance. On the basis of experience and periodical meetings, a list of factors can be established on the supplier's performance in each area. Accordingly, each factor can be graded as "never",  "seldom", "usual", and "always" etc. Since this involves record keeping and calculations of a large amount of data, computerisation is a must for proper implementation. 

Some of the vendor rating methods are as follows : 

1. Weighted Point Plan (factors considered are quality, price and delivery schedule) 
2. Cost Ratio Method (factors considered are identifiable purchasing and receiving costs to the value of shipment received from supplier) 
3. Heston's Vendor Selection Method (selecting the ideal standards and diluting them till one or two vendors qualify) 
4. Forced Dec Lion Matrix Method (using relative weight ages attributable to various factors like price, quality, lead time, service etc.) 
5. Dowser's Key Questions Method (answering key questions regarding need for a vendor like why, who, how etc. and thus, building a vendor profile) 
6. Spear Supplier Evaluation Method (mostly, some macro level factors used to analyse are management, engineering, finance, material, manufacturing, quality and reliability etc.) 
7. IBM Quality Rating (uses factors like desired inspection costs to actual inspection costs) 
8. Bell Quality Rating System (uses factors like acceptable and rejected material) 

Which of these is the best for the construction Industry ? It is very difficult to pass a judgement here. But more mechanical customization works may be better addressed by the IBM and Bell methods. The Weighted and Easton's method are simple in implementation. However, these are the methods for guidance only and the user has to select the best method himself. However, one aspect is very clear that for more accurate and reliable vendor rating methods, computerisation is a must.