Process-Based Supplier Audit: How You Can Evaluate Your Suppliers Effectively?

Supplier audit management is a critical business practice for companies that increasingly outsource business processes to strategic partners and have increased reliance on vendor products and services. The supplier audit process ensures that suppliers are continually performing at or above the levels outlined in procurement contracts. Incorporate industry best practices for developing supplier audit procedures and checklists to identify under performance that might be timely remedied and encourage support quality efforts in high performing areas.

Audit reports are an important part of supplier-customer business partnership which aims to check and improve the current quality and delivery processes. Satisfied by the ISO 9001 standards, supplier audits can be used as a key element for the yearly supplier evaluation.

Perks of Carrying Out Supplier Audit Reports Effectively:
• Supplier audit ensures that an efficient and functional quality management system has been established
• Supplier audit keep transparent documentation of optimization processes assuring the product and raw material quality
• The development of suppliers can be documented and compared
• Supplier risks and quality related costs can be reduced
• An active communication between customers and their suppliers strengthen to the long-term a healthy business relationship.
Step-by-Step Guide for Evaluating Suppliers

Step 1: Collect All Info about Your Supplier: You first have to gather all info and docs which have been exchanged between you and your supplier such as contracts, delivery specifications, complains or work instructions. These documents should be requested and filed in advance with your supplier documentation.

Step 2: Checklist for Supplier Audit Execution: The following aspects should be standardized reviewed and evaluated. The checklist can serve as a comparison basis for all supplier audits.

• General impression of the production
• Plant equipment, machinery and manufacturing
• Internal and external communication
• ISO standard satisfied quality management
• Testing instruments and equipment
• Inspection
• Employee qualification
• Delivery reliability

Step 3: Audit Execution: By using the checklist mentioned above, you can compare the current situation with the desired one (based on contractually agreed conditions). The audit can be performed by the customer itself or by an external service provider.

Step 4: Audit Follow-Up: The completion of the audit process is generally followed by a final meeting with the supplier. Within the ISO 9001 certification, the consumer has to let the evaluation/checklist transparent and available for the supplier. The supplier audit report also provides the basis to determine solutions to improve the product and delivery quality. The supplier can then fulfill those tasks within a defined period of time.

With this information, be ready for your next supplier audit report!