Past Performance of Suppliers

The selection of suppliers has a profound impact on both the quality and cost of drugs.  Inadequate quality assurance in the selection process may result in the purchase of drugs that are ineffective and unsafe.  Hidden costs caused by late deliveries, default on confirmed orders, losses due to poor packaging, short expiry date and other factors attributable to an unreliable supplier may raise the cost of a drug to several times the original contract price 3.  Apart from the cost implications, poor supplier performance can seriously hurt the credibility of health programs and demoralize health workers.

Prior to the adjudication of contracts, the past performance of suppliers is reviewed in detail.  The factors considered in evaluating supplier performance include delivery times, the number of partial shipments per purchase order, expiration dates, quality of packaging and labeling, quality of attendant documentation, quality assurance of products and proficiency of the customer service department.