Supplier Shortlists
Part of Managing repeat supplier orders
Tracking changes in lead time and defect rates
Use consistent timing events and checked-unit counts to compare repeat orders without overstating sampled defect results.
Track lead time and defective units using definitions that stay consistent across orders. Keep original promises, actual dates, checked-unit counts and reasons for exceptions. A change in the figures is useful only when products, events and checking methods are comparable.
Define the timing events
Choose a start and finish event for actual supplier lead time. For example, measure from the supplier's written acceptance of a complete repeat order to the date the agreed goods are ready at the named handover point.
Track transit and Australian receipt separately if other parties manage those stages. Record whether a deposit, artwork approval or buyer-supplied material was a prerequisite.
For each order, retain the acceptance date, original promised goods-ready date, later forecasts, evidence of actual goods readiness and actual receipt date. Keep the original promise visible. Calculate elapsed calendar days using the same start and actual finish events each time. Compare the actual goods-ready date with the promised date at that same point to assess lateness.
If delivery is split, show each portion and the date the required quantity became available. A single averaged date can conceal a late critical variant.
Key Metrics for Supplier Performance Tracking
- Actual Goods-Ready Date
- Date agreed goods are ready at handover point
- Original Promised Date
- Promise made at order acceptance
- Elapsed Calendar Days
- Same start and finish events used consistently
Define the defect denominator
Keep defects found during a receipt check separate from those found in a pre-shipment sample or later customer returns. One possible receipt measure is:
Checked-unit defect rate = defective units found in the stated receipt check ÷ units actually checked × 100.
Record the checked quantity, variants, selection and check methods, and checks that were not performed. Count a unit once in this unit-based rate even if it has several faults; keep defect types separately if useful. A result from a sample describes checked units. It is not a measured defect rate for all uninspected units.
For arithmetic illustration, 6 defective units among 200 checked units give a checked-unit rate of 3%. This is a hypothetical calculation, not a supplier result or a rate for an entire uninspected order.
Compare like with like
| Change in the record | How to handle it |
|---|---|
| Product or material version changes | Mark the change date; compare versions separately where the difference matters. |
| Inspection method changes | Record both methods; a stronger check may find more defects. |
| Order size or variant mix changes | Keep counts and variant results beside the overall rate. |
| Buyer or freight delay occurs | Record it in the relevant stage rather than assigning it to supplier production. |
Review individual orders alongside any rolling summary. A small checked count can move a percentage sharply, while an average can hide a repeatedly late critical variant. Choose action thresholds for the product and service need; this method supplies no universal acceptable defect rate or lead-time tolerance.
Comparing Lead Time and Defect Rate Metrics Across Orders
- Change in Product Version
- Mark change date; compare versions separately if difference matters
- Change in Inspection Method
- Record both methods; stronger checks may find more defects
- Change in Order Size or Variant Mix
- Keep counts and variant results beside overall rate
- Buyer or Freight Delay
- Record in relevant stage; do not assign to supplier production
Investigate a change
If lead time lengthens, ask which stage moved: order confirmation, materials, production, correction, packing or transport. If the checked-unit defect rate changes, compare defect types, product versions and inspection coverage. Ask the supplier for an explanation and proposed correction, then check later deliveries for evidence of improvement.
Keep product safety separate from a commercial trend threshold. For consumer products supplied in Australia, assess the requirements for the actual goods. A low observed defect rate does not establish compliance.
Steps to Investigate a Change in Lead Time or Defect Rate
- Identify the affected stageCheck whether order confirmation, materials, production, correction, packing or transport caused delay
- Compare defect types and inspection coverageReview changes in product version, defect categories, and check methods
- Request explanation from supplierAsk for cause and proposed corrective action
- Monitor future deliveriesVerify improvement through follow-up performance data
