L Company Supplier Performance Evaluation System Research

In recent years, due to the financial crisis and domestic labor costs rise, the operating pressure of Company L is increasing. Company L as one-stop supply chain service providers in garment industry, the sales department does not have its own factory, sewing machine, and fabric mill; Company L's main asset is 15000 supplier resources in 60 countries around the world. It is mainly through the existing 15000 suppliers to provide products and services, so as to create value and profits. So, how to successfully manage the 15000 suppliers is the premises of creating value. The setting up and implement of supplier performance evaluation system, is the key of the supplier management. Therefore, the establishment of a complete set of supplier performance evaluation system to manage the supplier resources of company L, not only can create value and profit, also to maintain the company's reputation; meanwhile, improve the competitive level of the supplier; and achieve Company L's goal to "provide consumers all over the world with appropriate, right time and right price of the product". Promote the company's supply chain with a healthy and sustainable development can keep the industry competitiveness, and make the company still can improve the profitability in a weak economic environment.This thesis studied in rapidly rising labor costs, increasing the environmental protection standard, changing customer demand and competition in the industry environment, how to design and implement supplier performance evaluation system.First, this thesis studied the supplier management performance evaluation system of Company L, and pointed out the following existing problems:a) The selection of the supplier evaluation index is not reasonable, only covers the aspects of quality and compliance; there is no selection index which is widely recognized in the theoretical circle, such as supplier's delivery, cost and so on; and the experience of these indicators mostly depends on the salesman;b) The evaluation charts are too complicated, each one needs to fill in and check the long form;c) Unreasonable assessment cycle setting, assessment cycle is once a year, it doesn't accord with the actual operation of business requirements and the company's supplier classification management;d) There is no concrete guidance or timely follow up after evaluation; there is only some advice but no specific guidance and follow ups;e) No incentives after evaluation, just issue a report and show the results.Secondly, in reviewing the above problems, the author embarked from own working experience, according to the problems in the practical work, combined with the company's goal of "provide consumers all over the world, with appropriate, right time and right price of the product ". After studying the research achievements of predecessors, the author built a relatively comprehensive, scientific and reasonable supplier performance evaluation system. The systems include selecting the reasonable performance evaluation indicators, using the analytic hierarchy process analysis to determine the index weight; simplifying the procedure of evaluation; and according to the result of performance evaluation, implementing the supplier classification and dynamic management of suppliers. Meanwhile, the systems also include designing the supplier incentive mechanism to effectively encourage suppliers according to the results of the assessment. Next, the internal implementation of the performance evaluation system in Company L sets up supplier performance evaluation committee who are responsible for the training and implementation of the performance evaluation system.Finally, basing on 658 suppliers' testing in Company L, after the implementation of before and after contrast, the thesis verified the validity of the performance evaluation system.The implementation of the performance evaluation system not only improved the competitiveness of the company in the industry, but also continuously improved the performance measures of suppliers, also built the continuous development and improvement of the strategic partnership between the company and suppliers. Through the dynamic management, it also improved the competitive level of the suppliers.Ultimately, to achieve mutual benefit and win-win results, the thesis provides a good case for apparel industry suppliers' performance evaluation, and a considerable guiding value and practical significance, also a good method for supply chain management.