Practical worksheet

Supplier review checklist

Compare suppliers on total cost, reliability, terms and concentration risk.

Last reviewed 2 October 2026

Before you start

Use actual delivery records and written terms. Check contract obligations before switching.

A low quoted price can cost more when delays, quality failures or short terms disrupt the business.

Use before selecting a supplier and at a scheduled renewal or price change.

It reveals which supplier risks need a backup and whether terms match customer payment timing.

Each prompt explains what to enter. The example is a guide, not a target for your business.

01. Need and alternatives

Describe the product or service, how critical it is and possible alternatives.

Packaging needed every Monday; two approved substitutes available.

02. Full cost

Compare unit price, freight, minimum orders, defects, returns and administration.

Supplier A costs $0.20 less per unit but requires twice the minimum order.

03. Delivery and quality

Record on-time delivery, defect history and how problems are resolved.

Three late deliveries in 12 weeks caused missed customer dispatches.

04. Terms and concentration

Compare payment dates with customer receipts and estimate impact if this supplier fails.

Pay in 7 days, collect in 30; alternative takes three weeks to onboard.

05. Decision and backup

Record your decision, owner, review date and contingency.

Trial alternate supplier on 20% of orders for one month.

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This worksheet is general planning information. Ask a qualified accountant, tax agent or lawyer where your decision needs specialist advice.