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EVALUATION OF SUPPLIER PERFORMANCE

1 EVALUATION OF SUPPLIER PERFORMANCE - the case of Volvo Car Corporation and its module suppliers Competitive paper Peter Fredriksson1 and Lars-Erik Gadde Department of Industrial Marketing Chalmers University of Technology SE-412 96 Gothenburg, Sweden Tel. +46 31 772 10 00 Introduction Purchasing and suppliers are of major strategic importance to most companies today. This is because a substantial amount of the resources used by a company are made available through its suppliers. Purchases from suppliers account for more than half of total costs for most companies and in some industries, such as electronics, telecommunications, construction, and automotive, this portion is normally substantially higher (Gadde and H kansson 2001). Suppliers are important to buying firms not only in financial terms.

performance measurement systems in relation to their suppliers (Morgan 2000). Pearson and Ellram (1995) compared small and large firms in the electronics industry in a national survey with regard to the utilization of supplier evaluation programs. The study showed that large companies were more involved in formal reviews than were small firms.

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