Vendors

Vendors are individuals or organizations that sell goods or services to other businesses, governments, or consumers. The term is often used interchangeably with supplier or contractor, though in some contexts vendor denotes the party from whom a buyer purchases under a contract.

Common categories include manufacturers that provide finished products, distributors and wholesalers that move goods, service providers that supply labor or professional services, and subcontractors that perform components of a project. Vendors can be direct vendors (suppliers of raw materials or components) or indirect vendors (goods or services used to operate the business).

Vendor management involves identifying needs, selecting vendors, negotiating contracts, onboarding, managing performance, and ensuring compliance. The procurement process typically includes requirement definition, market research, issuing RFQ or RFP, bid evaluation, contract award, purchase order, delivery, invoicing, and payment.

Performance is tracked with KPIs: on-time delivery, quality, defect rate, lead times, price competitiveness, and supplier responsiveness. Risk management covers financial stability, supply continuity, cybersecurity, regulatory compliance, and ethical practices. Contracts specify terms such as price, delivery, warranties, confidentiality, and liability.

Governance considerations include supplier diversity, codes of conduct, anti-bribery measures, and data protection. Technological tools like vendor management systems and e-procurement platforms help automate supplier records, performance monitoring, and risk assessment.