CHAPTER ONE
1.0 INTRODUCTION
Nestle Food Plc, case study of my project topic is well known for it vendor selection and rating. The study of purchasing and supply management can not be complete without proper selection of vendor and rating of their performance.
The progressive manufacturing industries realizing the contribution of supplies department of profit, have this department to make the selection of supplier in order to maintain company’s own competitiveness which will also enhance better supplier relationship, reliable supplier performance, easier administration and fewer supply problems.
Vendor selection and rating is becoming of vital importance in every manufacturing organization today in that it need for effective cannot be over looked of every manufacturing company’s budget. Is on materials, it is therefore very necessary that materials which meet organization taste as regards to sources, quality, price and delivery be given consideration. Prior to this, it is therefore of great importance to ensure that proper supplier are selected and rated according to their performance so as to ensure that proper suppliers are selected and rated according to their performance so as to ensure the need of the organization. It is therefore the responsibility of purchasing and supply department to select the best supplier, identify the major sources of information about potential supplier, through the use of trade journals, exhibitions, sales representative, colleagues in the company, professional associates, chambers of commerce and costly international sources, these sources of information can be very useful to the success of vendor selection.
The organization must function in one of the most sensitive areas of vendor performance and rating. LAMER LEE JE AND DONALD W. DOBBLER, in their text said upon completing of list of all potential suppliers, a buyers (firm) next step is to evaluate each of these suppliers individually. By process of elimination, a selected list of vendors negotiate or solicit bids.
The vendor list should be comprehensive enough to bring to best to every of competition desired, price technological competition service competition etc.
Evaluation of company’s vendors is considered as an effective tool for improving their ability to serve more satisfactorily as a basis for making future purchasing decision.
Finally, when suppliers have been selected, organizations have ensured that they maintain and create a good relationship with their suppliers as to maximize profit.
Management must therefore ensure that proper supplier are selected and rated periodically in order to contribute to the profit ability of the organization so that purchasing and supply department will be accorded a high degree of honour.
1.2 STATEMENT OF PROBLEM
1. The organization does not attach a lot of importance to vendor selection and rating.
2. There no qualified personnel available to handle the job vendor selection and rating in the organization.
3. The firm fears if is very costly to handle the issue of vendor selection and rating.
4. The firm’s organization structure has negative effect on the effective performances of vendor selection and rating.