Dictionary of Procurement Terms

Any contract, addendum, or modification accomplished by the mutual action of both parties to the contract.

An individual or business that provides goods or services, usually for other than lowcost, low-risk, and short-term engagements. See also: Vendor.

A review conducted of specific suppliers to assess their qualifications, availability, performance, past performance, and product quality; to look at specific traits and elements of that specific supplier as opposed to the aggregate. See also: Market Analysis, Demand Analysis.

A systematic organizational effort to create and maintain a network of competent and pre-qualified suppliers.

1. An objective analysis that evaluates the past performance of current suppliers. 2. A preliminary assessment of new suppliers. 3. An evaluation of any or all of the capabilities of a supplier that pertain to its competence as a source of supply; suppliers are usually evaluated on their technical quality, delivery, service, cost, and managerial capabilities.

The time that typically elapses between when an order is received by a supplier and when the material is shipped. See also: Lead Time.

A form of outsourcing whereby a contract is initiated with a private business to manage and control the inventory of the public entity. The contractor is responsible for all inventory functions, which may include re-ordering.

A guide that provides the basic instructions necessary to conduct business with an agency. Developed by the agency, it clearly states the general code of ethics and business relationships, which may include, but is not limited to: 1) the standards of conduct expected of agency staff and suppliers, and 2) The limitations regarding their relationship and extent of contacts that suppliers should have with all agency departments and agency staff. Also referred to as a “vendor manual.”

A report that evaluates a supplier’s performance based on certain criteria, such as quality, delivery, timeliness, and responsiveness.