Purchasing resource

Compare suppliers on total purchasing cost, not unit price alone

A practical framework for comparing supplier quotations using unit price, tooling, MOQ, freight, packaging, lead time and commercial risk.

Unit price

Start with the quoted unit price, but confirm exactly what it includes.

One-off costs

Tooling, fixtures, programming, NRE, qualification and setup can materially change the economics at low or medium volumes.

Logistics

Packaging, freight, shipment frequency and Incoterms affect the landed purchasing cost.

Working capital

High MOQs and long lead times can increase inventory and cash requirements even when the unit price is lower.

Risk

A cost comparison should also make visible the operational cost of long replenishment times, single-source dependency or uncertain capacity.