Abstract
Several formal methodologies are proposed for evaluating prospective suppliers. Three popular methods for supplier performance evaluation appear in the literature: categorical, weighted point and cost ratio. However, these techniques have a number of disadvantages associated with them and an alternative approach is suggested which applies dimensional analysis to selecting prospective suppliers. An international purchasing office (IPO), located in Hong Kong, has been applying the dimensional analysis approach to evaluating suppliers based in Hong Kong and China. Using the IPO as a case study, the article discusses the benefits of this approach over the traditional assessment methods and how it can be used to measure not only supplier performance, but also the contribution to the purchasing relationship from the buyer organisation.
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