Production & Materials Management: Production & Materials Management Unit-III Organization of Materials Management(14.09.2011) Fundamental Principles Structure Integrated materials management Purchasing procedure principles import substitution and import purchase procedure vendor rating (14. 09.2011) Vendor development. ( 14.09.2011) Vendor Rating: Vendor Rating It is not always easy to identify good suppliers. Records maintained or procured from some other sources about the vendors help in their evaluation and rating. Usually a combination of price, quality, delivery time, service etc., giving relevant weightages to these factors is used to rate the vendors. Vendor Rating: Vendor Rating In addition, a checklist can be used to facilitate rating from department standpoints. Some of the points are mentioned below: Reliability Technical Capabilities Convenience After sales service Availability Sales Assistance Vendor Rating: Vendor Rating Reliability: Is the supplier reputable, stable and financially strong? Are the supplier’s integrity and ability above doubt? Is the supplier going along with product improvement? Is the supplier’s competitive strength as to price, quality etc., proved by past experience? Vendor Rating: Vendor Rating Technical capabilities Can the supplier provide assistance as to application engineering? Can the supplier provide assistance to analytical engineering? Can the supplier provide design assistance? Can the supplier handle special needs and contribute to improve product efficiency/basic processes? Vendor Rating: Vendor Rating Convenience Can the supplier help reducing acquisition costs through personal visits, telephone calls, incoming inspections, rejection of defects, spoilage etc.? Can he offer other related products? Is he qualified to help in solving difficult problems? Does the supplier package his product conveniently? Vendor Rating: Vendor Rating Availability Does the supplier assure delivery in time? Are his stocks locally available and or at short notice? Is the supplier’s location advantageous? Can he plan his supply to minimize inventory? Can he be depended on for a steady flow of materials? Vendor Rating: Vendor Rating After-sales service Does the supplier have a service organization? Is an emergency service availed? Are parts available, when needed? Vendor Rating: Vendor Rating Sales assistance Can the supplier help building mutual markets? Will he recommend our products? Does the use of supplier’s product enhance appearance of our products? Vendor Evaluation: : Vendor Evaluation: Recognizing that there is a need for having good vendor, it is essential that supplies are obtained from vendors after an evaluation of his capabilities. The buyer, who has to do the evaluation, is faced with two different situations: Evaluating the performance before the vendor has delivered anything. Evaluating the performance of vendor after the deliveries have been made. The latter one is called vendor monitoring and the former vendor evaluation. Vendor Rating: Vendor Rating In case of vendor evaluation the buyer lacks the direct evidence on the results achieved by the vendor and must get his information in other ways. This includes (1) general reputation of vendor, (2) data from other buyers (3) vendor surveys. ORGANIZATION OF MATERIALS MANAGEMENT: : ORGANIZATION OF MATERIALS MANAGEMENT: 1. Organization based on the overall company organization. Organization based on Commodities. Organization based on Location. Organization based on Function. . Organization based on the overall company organization.: . Organization based on the overall company organization. Organization based on Commodities.: Organization based on Commodities. Organization based on Location : Organization based on Location Organization based on Function. : Organization based on Function.