Vendor Performance Insights

The Vendor Performance Insights help procurement managers evaluate and compare vendors at the transaction level, enabling issue resolution, discount requests, and contract negotiations.

The vendors are graded based on these criteria:

• Promptness: Measures how quickly vendors deliver orders by calculating the difference between the order date and the delivery date.
• Quantity: Assesses discrepancies between the ordered quantity and the delivered quantity.
• Quality: Measures the number of returned goods and assesses the reasons for return.

The Vendor Performance Report shows the list of the vendors and their performance rating over the past 12 months. K-means clustering algorithm is used to calculate these scores:

• Grade: A value of 1-27 where 27 is the worst and 1 is the best. It is based on the Prompt score and the Quantity score.
• Prompt score: A value of 1-100 where 1 is the worst and 100 is the best. It is based on promptness of delivery.
• Quantity score: A value of 1-100 where 1 is the worst and 100 is the best. It is based on the discrepancy between the ordered quantity and the delivered quantity.
• Quality score: A value of 1-100 where 1 is the worst and 100 is the best. It is based on the amount of returns and reasons for return.