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Old 01-02-2013, 05:10 AM
gokulbhushan
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Hello Sean,
You can consider the following factor's in association with your New Vendor Induction
1)Vendor Research- Financial rating (ex. D& B rating), Market performance.
2)Vendor training - to accustom them to the ERP's, e-Tools, processes etc
3)If your using subscriptions to any ERP's based on usage, you may want to consider the cost of new subscriptions as week
4)If your replacing a critical supplier- Consider the risk factor associated if the vendor cant cope up and result in any losses.

Mandate an agreement to counter above costs if the new supplier is unable to meet the requirement as your Old supplier does.

Also apart from cost factors, its crucial to consider non-cost factor for you to support your business case to the senior management like
1) Long term advantages you foresee
2) Disadvantages continuing with the same supplier.
3) Moving from single supplier to multi-supplier structure to avoid monopoly
4) Bring in competition for better pricing
5) A similarity in your supplier's and you companies future goals so that tying up with the new supplier can prove advantageous to your company.. etc..

Hope this helps !!
Cheers,
Gokul
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