Your CEO wants to develop specific criteria to select vendors for office supplies, equipment, etc. and has asked you to investigate selection criteria. In a two page business memo: Explain why a selection criteria is needed, recommend specific criteria, explain why each element is needed, and include an example of a company with similar criteria.

Criteria to select vendors is likely to evaluate cost, as the CEO must adhere to a budget, the vendors' product offerings, convenience, and service. If the vendor does not sell all products the company needs, it could lead to inefficiencies. If delivery cost is included in the stated price, it could make vendor selection easier. Another criterion is how green the vendor is. Environmental, social and governance (ESG) considerations are also becoming more important to people in the corporate world.

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One obvious criterion is cost. The company CEO has a budget and must adhere to the expense allocations outlined in that budget. Any overage to the expense allocation would translate into narrower margins and lower profit. If this particular company operates on narrow margins already, as companies in many industries...

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One obvious criterion is cost. The company CEO has a budget and must adhere to the expense allocations outlined in that budget. Any overage to the expense allocation would translate into narrower margins and lower profit. If this particular company operates on narrow margins already, as companies in many industries do, going over the budgeted expense level could even mean that the company would be unprofitable. Thus, the employee who must prepare the analysis for the CEO needs to look at the average costs of each vendor’s offerings, focusing on the specific products that the employee’s company orders frequently.

Another criterion is the vendors' offering selections. The company needs access to a broad range of office supplies and equipment, including pens, notepads, computer paper and printer cartridges and many other items. If the CEO selects a vendor that does not sell all the products the company needs and then has to rely on multiple vendors, this could lead to inefficiencies in the vendor management process. That said, it is also possible that the CEO would like to maintain multiple vendors as a safeguard to ensure access to supplies but nevertheless that also underscores the importance of ensuring that each vendor sells a broad range of products.

Other important criteria include convenience, service and environmental, social and governance considerations (ESG). Some vendors also provide service for the equipment, generally at an extra cost. Nevertheless, the opportunity for one-stop shopping for the office equipment and having access to a service organization that has been trained on the specific equipment installed in the CEO’s company is probably a plus. Another criterion is convenience. Does the vendor deliver? How long does delivery take? Is the cost of delivery included in the listed prices? Another criterion is how green is the vendor. ESG considerations are becoming increasingly more important to a variety of stakeholders in the corporate environment, including investors, partners and purchasers.

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