Sustainable Procurement: Supplier Evaluation Criteria, COVID-19 Impact, and Technology Trends

This report discusses sustainable procurement and supplier evaluation criteria for organizations, with a focus on Nestle Nigeria plc. It also explores the effects of COVID-19 pandemic on supplier selection and the rise of new technology trends such as IoT and big data. Additionally, the report examines the impact of stakeholder relationships and institutional pressures on supplier selection.

Sustainable Procurement

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
a) Designing a list of supplier evaluation criteria for organization.............................................3
b) Explaining the effects of COVID-19 pandemic on the organization's and rise in the new
technology supplier selection......................................................................................................6
c) Organizations stakeholder relationships and institutional pressures effect supplier selection
.....................................................................................................................................................8
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Sustainable procurement plays a vital role in the company as it is the integration of
principles related to CSR which is in current trend. The CSR is important process used by
company in the processes and systems of procurement. The decisions have been taken by
companies to ensure that they meet the stakeholders needs. The present report will be based on
supplier evaluation criteria and it will provide detailed information about effects of COVID-19
pandemic on the firms' supplier selection. A study will be based on Nestle Nigeria plc which is a
manufacturing firm. Nestle is one of the largest food and beverage firm which provides food and
drinks to satisfy customers.
a) Designing a list of supplier evaluation criteria for organization
As we all know that in last few years the businesses are showing more interest and are
more attracted towards the systems of businesses who are using sustainable practices that can
reduce or eliminate the impact of environmental factors on society. Due to corona virus
pandemic, the suppliers' selection strategies have shifted from inquiries about price to fulfilment.
To be successful, nestle Nigeria plc aims to be a sustainable and eco-friendly company and wants
to be more responsible firm in order to satisfy customers and help to measure climate change and
changing environment trends. According to management team of this company, it is essential to
sign a code of conduct which can improve their sustainability system and eco-friendly practices.
According to Abdirad and Krishnan, (2021) there are majorly two different kinds of
supplier evaluation : performance based evaluations and process based evaluations. A
performance based evaluation is systematic assessment of the actual performance based of
supplier which includes cost and delivery reliability. While on the other side, process evaluation
is an assessment based on actual production service system and production practices which is
done by auditing the site of supplier. With the help of procurement management, the company
Nestle plc will be able to help themselves to evaluate potential suppliers which can enhance
supply chain management. with the help of following supplier evaluation criteria the firm can
find the best suppliers that will fit business needs and requirements.
Clean and communication-
Supplier criteria play an important role for organization as it is attribute that a buying
company values in its arrangement with the business suppliers. Hence, it is said that

sustainability and CSR is one of the major criteria of selecting a supplier to any organization in
the manufacturing industry (Goldsby and Zinn, 2016). The company must focus on commitment
of suppliers towards sustainability and ask them whether they are following laws related to
environment or not. On the communication side, the firm must know about how the suppliers
plans to keep in touch with the company and know about whether the suppliers will be able to
handle communication in the event of financial crisis such as recent crisis – Covid-19 pandemic.
Financial stability and cash
it is essential to look about the financial health of supplier to work effectively with them.
The company should choose an effective supplier along with healthy background having enough
money to work in better way. Hence, it is said that cash positive company's are the one who can
run business smoothly and in a much better way to achieve goals in the any kind of crisis. Nestle
plc show know about what information can the supplier provide in order to demonstrate their
financial health and background.
cost and consistency
The firm should keep track on cost of the services and goods that selected supplier offers
to them. As we all know that cost is the main key factor when choosing and selecting supplier. In
order to run business smoothly for long term the company must know about cost ability to affect
business. On the other side, while choosing supplier, the firm must focus on asking them about
their consistency, risk management to provide high quality products (Yazdani, and et.al., 2017).
They must ask them whether they have a strong track record about industry trends such as
technology approach and innovative methods. Nestle Nigeria plc is focusing on asking about
potential suppliers approaches to work with them in future for long term.
capacity
if company wants to select and finalize supplier they must ensure that suppliers is able to
manage and handle the needs of the business or not. While selecting the supplier, the company
must ask them about their abilities and interest (Muessigmann, von der Gracht and Hartmann,
2020). They should see how rapidly they will be able to answer to the preferences and
requirements of the firm and to market. They should also see whether they are able to respond to
supply fluctuations. In addition to this, the firm must see resources used by suppliers to find out
whether they have the means to meet orders of the firm.

Resources such as employees, storage, tools, equipments, available raw materials must be taken
into consideration while knowing about capacity.
commitment
the company should select supplier who provide evidence that they are really committed
to manage high quality standards of service or products. It is essential for company to select
suppliers who show interest and commitment to firm (Richey, and et.al., 2022). Hence, it is said
that the supplier must also show that they are committed to business operations done, as a
stakeholder or client, throughout the working year that the firm is expected to work in
partnership. It is advisable to Nestle plc to look at these criteria very actively because it is
essential for them if they are planning to work with supplier for long term and wants to manage
relationship with them in the future.
Competency and control
The company must look at the competency of supplier, it includes the ability, capabilities
and measure them against the requirements of the firm. Nestle Nigeria plc is focusing on the
feedback provided by customers about suppliers. They also must need to know about how happy
are the customers with the selected suppliers and whether they are able to handle difficult
situation or not (Chiappetta Jabbour, and et.al., 2019). The firm must need to know about why
customers are changing suppliers, hence On the basis of this evaluation, nestle Nigeria plc is
always focusing on looking for customers and suppliers whose needs ,requirements and values
are similar to business needs and gathering information that is relevant to company success. On
the other side, while selecting supplier, the company must ask them whether they are able to
control over procedures, processes, systems, rules and regulations, policies and supply chain
management.

b) Explaining the effects of COVID-19 pandemic on the organization's and rise in the new
technology supplier selection
Pandemic is one of the adverse situation that has negative impact on the working
procedure of the organization. It is important for the company to pay attention on developing the
significant evaluation of the crucial aspects that has influence in functioning of firm. Suppliers
are the one of the crucial external stakeholder that hep the firm to obtain the required level of
inputs for having the smooth functioning in turn offering the goods to meet market forces such as
demand and supply. Nestle is one of the international company that operates on large scale in
food and drink processing sector and possessing the highly effective supply chain. In
order to be successful in the current working environment the company has given emphasis on
gaining the competitiveness by possessing diverse supply chain. Pandemic as being the adverse
situation has negatively affected the mobility procedure of supplying chain which tend to result
in impacting the growth & development of enterprise. The reason behind the difficulty is due to
the rise in the requirement of flexibility, safety, less costly, etc. which has influenced the
working of firm in negative manner (What impact has COVID-19 had on supply chains &
responsible sourcing? 2022). Pandemic is has as well affected the demand level for the different
types of the products offered by the organization that is inclining the cost, declining profitability,
enhanced legal compliance, greater quality and standard achieving needs, procurement &
supplying duration, related risk, technical capabilities, etc. These are the few crucial factor that
has been impacted by the COVID 19 situations that has influenced the criteria of selection of
suppliers.
In the current time of COVID, the selection of suppliers is one of the strategic decision
so having appropriate level of ability to coordinate with the changing circumstance can be
derived (Kurpjuweit, Wagner and Choi, 2021). Nestle in its selection procedure of suppliers
highly focuses on having the greater positive impact by ensuring that significant level of
communication, service level, delivery patterns, financial status, performance history,
geographical location, political stability, lead time, technical capabilities, distribution cost,
quality & hygiene criteria, etc. These are enabling Nestle to get the significant ability to obtain
the appropriate competitiveness in respect to adhere with organizational requirements. There is
more concentration is offered on having increase level resilience so that having the appropriate
ability to coordinate and meet the demand requirements can become possible. On the basis of

this, it can be interpreted that there are several challenges that has occurred due to pandemic
situation and affecting the working procedure of the firm in negative manner. The main reason
behind these complications is to the inclined awareness among the different stakeholders
regarding the safety, hygiene and quality that is resulting into the enhanced processing of the
company. On the basis of this, it can be interpreted that the Nestle as being the one of the
successful international organizational is focusing on having diverse suppliers by ensuring that
lower cost and higher probability deal can be made.
The rise of new technologies affect the supplier selection.
Due to changing trends and adaption of new technology the company have to be very
active and keep track on advanced technology used by its competitors. Nowadays, while
selecting suppliers the companies are following some criteria which has been evaluated in above
answers. In today's world, technology is proving a major boon for a huge range of supply chain
management and its functions and also of sustainable procurement (Impact of technology
uncertainty in supplier selection, 2022).
Quick delivery system – with the help of advanced technology, the company is able to
provide quick delivery to customers. The delivery time should be less as compared to other
companies so that there is a rapid delivery of devices to satisfy customers (Yazdani, and et.al.,
2017). Basically, it is said that the suppliers who take less time to deliver products are more
likely to stay in the market for longer period. However, quick delivery of goods or services
decreases the amount of forward planning and enhance the business operations and flexibilities is
beneficial for the company performance.
INTERNET OF THINGS
Due to the usage of IoT which is a system of interrelated computing devices, advances
machinery, digital technology machines and mechanical devices that exchange data, information
the manufacturing companies are running their business operation smoothly. With the help of
IoT nestle plc is able to accelerate things by using increased network and integrate artificial
intelligence. In addition to this, IoT is also connected with others that facilitates the
communication between devices.
While selecting supplier, the companies are using Internet of things as an emering trend
which helps them to facilitates supply chain management Govindan, K., and et.al., 2018. With
this they can keep track on information and data in order to save money and time. By using IoT

the nestle Nigeria plc, is able to make important decisions making process. Post pandemic
companies are more interested in using advanced technology due to rise in current trends related
to technology. With the help of interconnected devices and software the company is able to
monitor data and send information to cloud based software. With this they can also improve the
business quality management while managing its supply chain. This method is cost effective
technique which can handle management of suppliers and supply chain and it also helps to solve
issues. Procurement leaders like nestle Nigeria plc is able to build on newer capabilities in order
to help themselves while navigating the changing trends related to technology and adapt it
quickly to run business smoothly.
BIG DATA
As we all know that supplier selection and supply chain generate big data for the
company. By using those data, big supply chain analytics can get real insights which help them
to manage supply. With the help of big data , the company is able to satisfy its customers, can
enhance its suppliers selection procedure by going through all the criteria which is mentioned
above and also they can promote operational excellence in the business Govindan, K., and et.al.,
2018. By using big data as a technology, nestle Nigeria is able to decrease the communication
gap between supply chain management and demand management which helps them to cost
savings which is beneficial for the successful business. By managing ERP and SCM systems in
the company the management team is able to broadens the dataset for analysing the internal data
which is stored for the future needs and requirements. The big supply chain analytics use this
method in the company so that they can make important decisions which is helpful for business
activities related to supply chain. The major limitation of this method is lack of structured
process : many companies are unable to structure process in order to explore and capture big
data, due to this they are unable to achieve opportunities in their supply chain. So nestle Nigeria
plc is focusing on this limitation in order to take control of the big data opportunity with a
systematic techniques and methods.
c) Organizations stakeholder relationships and institutional pressures effect supplier selection
In today's business world, effective management of relationships with internal and
external stakeholders is important in order to resolve problems and issues which can impact the
business operations of the firm. While selecting supplier which best fit for the company, the
management team must focus on the stakeholder relationships which can influence the process.

There are many stakeholders in the company such as employees, customers, budget owners,
financial departments and management team and legal professionals. It is essential to maintain
relationship between stakeholders then only the company can manage its supplier selection
process (Kain and Verma, 2018). If the stakeholders is not supporting the decisions then they
cannot able to shape projects at initial stage which can influence the quality of project in a
negative manner. While on the other hand, if employees provide support to company in making
decisions while selecting supplier they can help management team to allocate more resources. If
stakeholders relationship is not good then it can impact negatively on supplier selection and
company will not be able to choose the best suppliers which can meet the needs of business.
While on the other hand, if stakeholders relationship is maintained properly it can engage and
gain the support and commitment in the continuous process of supply chain. If the company is
working with effective and right internal stakeholder who know how to maintain relationships
with other and enhance positive environment, then they can increase improvement in
procurement functions which can help the company to gain understanding of strategic issues.
Due to Covid-19, the company faced Institutional pressures while selecting supplier for
supply chain. These kinds of pressures are mostly arise when conditions in the market is not
stable and uncertain (Kain and Verma, 2018). Due to changing policies made by government and
recent trends such as sustainability, the company have opportunities which motivate enterprises
to pursue more business practices. Institutional pressures can enhance company to cost saving
goals related to supplier selection.
The selection of suppliers impact on the company's corporate reputation
Product quality and selling prices- in order to increase customer satisfaction, nestle
Nigeria plc is focusing on supplying quality products. In business, good standard comes from the
selected suppliers of the company. Therefore, if suppliers are giving low quality product then the
company may lose its reputation which can motivate customers to look for alternatives.
In order to make profit margins, the company needs to sell its service or products at a
affordable price which customers are ready to pay (Kurpjuweit, Wagner and Choi, 2021). If the
selling price of supplier is higher than it will influence the purchasing power of clients and vice
versa. If suppliers in the market do not supply the goods or services at affordable prices, it will
be difficult for customer to buy which can impact the performance.

Delivery time- nowadays, customer don't prefer to wait for so long, if the company offer
them on time delivery then customer stay loyal towards them. Long order delays is one of the
major factor that needs to be taken into consideration by firm. Long Delivery time can negatively
impact the performance of company because if customer feel that the firm is taking more time to
deliver goods then they can lose their patience level and could cancel orders. So, nestle Nigeria
plc, is selecting suppliers having efficient delivery services and focused on quality and time.
if the company focus on supplier selection effectively then this helps them to achieve
good market position. By using proper supplier selection process the company can reduce its risk
related to purchasing. An effective supplier can enhance performance of the company and attract
more customers which is beneficial for the reputation. Nestle Nigeria plc is doing selection of
suppliers in such a way that it can maximize the overall value to the customers. The selected
suppliers provide quality goods or service to customers, then reputation of the firm is maintained
and even strengthened which is beneficial for the performance.
While on the other hand, if the company fails to select the right supplier for the business
activities and supply chain, then it will impact the image of both company and its stakeholders. If
selected suppliers are giving wrong service and poorly produced goods to customers then the
success of business may get impacted negatively (Kurpjuweit, Wagner and Choi, 2021). As a
result, lose reputation can impact the customer base of the company because customers will have
another options available, so they purchase things from different company. Nowadays, customers
believe that they have no problem looking for another options available in the market, so due to
this company may have to face lower profits which can lead to lower sales. By evaluating this, it
has been noted that performance of supplier can directly impact the success of company in a
positive or negative manner.

CONCLUSION
To conclude, post pandemic companies, customers, stakeholders are more attracted
towards sustainability and procurement and also focusing on supplier selection process. The
report has summarized that By using technology and advanced methods such as big data and IoT,
the company is able to drive increased operational performance and efficiency and also enforce
compliance with the support of policies and rules.

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ty_in_supplier_selection_for_NPD_collaborations_Literature_review_and_a_case_study>
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had-on-supply-chains-responsible-sourcing>