Records Maintenance

After the product or service has been delivered and the supplier paid, a record of critical events associated with the purchase is entered into a supplier performance database. The supplier performance database accumulates critical performance data over an extended period, helping purchasing identify trends or patterns in supplier performance.

Why is it important to capture the transaction-level data associated with all purchasing processes? This answer is discussed in the next section. Specifically, from time to time the firm must identify opportunities for savings through a process known as a spend analysis. Spend analysis becomes a critical input into building sourcing strategies—the topic of the next section.