Supplier scoring: How to assess performance?

Summary of the article

KPI & Performance
- What are the key performance indicators?
Supplier scoring
- How to assess your suppliers?
- Continuous evaluation and performance monitoring
TRANSPARENCY & COLLABORATION
- Transparency at the service of the supplier relationship
- Cooperation & collaboration
Faq

KPI & Performance

What are the key performance indicators?

The performance measurement of your suppliers is based on specific criteria that vary according to the needs and objectives of your business. However, there are key indicators commonly used to assess the performance of suppliers, in particular:

Otit (on time in full) : respect for the deadlines and compliance of the products.
Product quality : defect rate, compliance with standards and risk management.
Delivery time (lead time) : Punctuality and reliability of deliveries.
Costs : Respect for budgets and identification of optimization opportunities.
Reliability of commitments : rate of modification of confirmed orders.
Customer service : efficient communication, rapid problem solving.
Innovation : proposal for improvements and creative solutions.

Read our article on controlling the lead time in the textile supply chain.

Supplier scoring

How to assess your suppliers?

Several methods can be used to assess and note the performance of suppliers, the following of which:

Quantitative assessment: it is based on concrete digital measures, such as compliance rate, time delivery rate, defect rate, etc.
Qualitative assessment: It may include surveys of internal and external customers to collect opinions on the performance of the supplier in terms of quality, communication and service.
Performance dashboards: They offer a visual overview of the supplier's performance using key graphics and indicators.
Notation: the allocation of notes or scores makes it possible to synthesize the performance of the supplier.

Continuous evaluation and performance monitoring

Brands can define specific key performance indicators and receive alerts in the event of deviations. This allows a continuous evaluation of quality, punctuality of deliveries and other critical aspects of the supplier relationship.

Piloting tools, such as supplier portal or control tower, offer configurable dashboards to follow the performance indicators of your supply cycle. Based on the operational data of your various suppliers, they are decision support tools for the implementation of priority actions in the event of a change request. This allows the management of hazards and effective anticipation.

Freely download our guide to supplier management

Here are some examples of indicators that can be followed:

Percentage of commands delivered in time
Average delivery time
Middle production deadlines
Percentage of change requests
Escarts between the quantities sent and the expected quantities
Percentage of compliant quality controls
Number of parcels shipped
Reception times
Quantity rate rejected

These indicators not only improve performance, but also to adopt a risk prevention approach and stock reduction. By monitoring these elements, brands can quickly adjust their strategy and approach to maintain a high service rate and guarantee customer satisfaction.

Brands can support suppliers in their process of continuous improvement and encourage them to develop their practices so that they are more ethical and responsible.

TRANSPARENCY & COLLABORATION

Transparency at the service of the supplier relationship

Transparent communication with your suppliers is the pillar to perpetuate your relationships, here are some reasons:

Alignment of expectations: communication makes it possible to ensure that your expectations and those of your suppliers are aligned, which avoids misunderstandings.
Strengthening relationships: transparent communication strengthens trust and collaboration with your suppliers, thus promoting sustainable partnerships.
Constructive feedback: Providing constructive feedback to your suppliers is essential to help them improve. It is important to highlight the strengths and the areas for improvement.
Problem resolution: open communication facilitates rapid solving of problems and challenges that can occur in the supply chain.

Cooperation & collaboration

Thanks to a platform, online control tower, everyone can share effectively on a common repository, which avoids exchanges of emails, storage of attachments. This type of tool makes it possible to bring together stakeholders in the supply chain to offer them a common communication tool.

This network operation strengthens the cooperation of employees to inform them and allow them to make decisions effectively. A platform makes it possible to equip an ecosystem in which suppliers of the different manufacturing ranks, the transporters, the laboratories that carry out quality tests and the various brands services interact: production, quality, logistics, marketing.

The online collaboration features between suppliers and brands makes it possible to communicate and collaborate effectively such as exchanges of data, validations or request for changes, sharing of documents ... Everything is centralized on a single platform, thus reducing delays related to fragmented communications.

The FAQ

What are the main performance indicators to assess the quality and productivity of suppliers?

KPIs to follow: • Defect rate and product compliance. • Respect for delivery times and lead time. • Costs and budgetary optimization performance. • Inventory management and needs anticipation. • Reactivity and quality of customer service.

How to establish and communicate clear expectations to suppliers?

• Precise definition of specifications and objectives. • Implementation of flexible and transparent contracts. • Use of key performance indicators for optimal monitoring. • Regular meetings and feedback to adjust collaboration.

What are the advantages of the use of digital software and tools for monitoring supplier performance?

• Real -time monitoring of KPIs and supplier performance. • Automation of data analysis for better decision. • Centralization of data for increased transparency. • Optimization of costs and proactive risk management.

What quantitative and qualitative data is essential for a complete assessment of supplier performance?

• Quantitative: defect rate, time delivery rate, savings made, stock levels. • Qualitative: compliance with standards, responsiveness, satisfaction surveys and supplier audits.