Vendor Business Planning: Maximizing Your Vendor ROI

by David N. Rasmussen

How do you measure your vendors' performance? On-time delivery? Reject rate? Lowest product cost? Quality of service? These are all important metrics; however, they may not provide you with sufficient information to determine the adequacy of your return on the investment you made with your vendors. Such metrics tend to focus on the tactical attributes of the relationship but don't necessarily help evaluate the broader strategic attributes.