How to record new terms and read a supplier's performance

Two tabs of a supplier's page under Buying › Suppliers turn a contact list into a supply record: Terms, whose Terms history remembers what was agreed when, and Scorecard, which scores whether they actually deliver. The rest of the page is in How to add and set up a supplier.

Before you start

• The Store and Suppliers modules must be on.
• Reading terms and performance needs View suppliers in Settings › Permissions. Recording terms needs Edit suppliers. Both start at lead.

Why record terms with a date?

Because terms change, and an order placed last March was written under last March's terms. The Terms history section says so on screen: each set applies from its start date until the next one, and an order keeps the terms that were in effect when it was written.

Overwrite the lead time when a supplier raises it and you lose the ability to tell whether an old order was really late. Record it from a date and both answers survive.

The Terms card, at the top of the Terms tab and also on Overview, shows Currency, Payment terms, Pays after shipping, Lead time, Revision window and Minimum order.

How do you record a change?

1. On the supplier's page, open the Terms tab and press Set terms from a date.
2. In These terms apply from, pick the start date. It starts on today.
3. Change what moved. The form is filled in from the most recent set, so the rest stays as it was.
4. Press Save terms.

The new set appears in Terms history under its From date, beside every earlier set.

Each set carries Minimum order, Lead time (days), Revision window (days), Payment terms and Pays after shipping (days). Numbers must be 0 or more, and the form names the one that is not.

Saving a set for a date that already has one corrects that set rather than adding a second, so fixing a typo leaves one version behind. Changing a term through Edit does the same for today's date.

What is Pays after shipping for?

It is the number of days after an order ships that you pay for it. The buying calendar uses it to work out which month the money leaves. See How to plan a season on the buying calendar.

Leave it empty and an order is counted as paid on the day it ships. Payment terms beside it is the wording you agreed, such as Net 30, for people to read.

Can you record a rise before it takes effect?

Yes. Pick a start date in the future and the set is labelled Upcoming in Terms history.

A lead-time increase agreed in August for October is then visible to everyone planning in September, rather than arriving as a surprise. Record why it changed as a decision on the supplier, so the next person understands the number. See What are decisions and track records?.

What does the delivery record show?

On the Scorecard tab: On time as a percentage, When late (days late on average), and how many orders were scored, shown under each figure as "N of M orders". The five figures above the tabs repeat On time in full and When late. The on-time figure also appears in the On time column of the suppliers list.

The orders behind a figure are on the Orders tab. Press a figure on the Scorecard tab, or use the Late and On time buttons, and the table shows only those orders.

The number of orders scored is always shown, on purpose. 82% of three orders and 82% of three hundred are different claims, and only one is worth raising in a negotiation.

When nothing can be judged yet, the figure reads "No data" or "Nothing finished yet" rather than 0%.

What counts as a scored delivery?

Orders that can be judged: they have a due date, and they were fully received or closed short. Orders still on their way are left out rather than counted as failures.

Due date means the order's expected arrival, or its ship date when there is no arrival date. Delivered means the day the last of it arrived, not the first box. When late is worked out over the late deliveries only.

An order closed short counts in the total but never as on time, because you did not get what you ordered. An order with no ship date and no arrival date is never scored, so give every order at least a ship date.

What else does the Scorecard show?

Twelve figures in all, worked out from that supplier's orders and the deliveries booked in against them. Besides On time in full, On time and When late:

• In full: the share of finished orders that arrived complete.
• Delay spread: how much the arrival dates vary, as "± 3d". It needs 3 deliveries.
• Promise moved: the share of orders whose promised date changed.
• Accepted of ordered: units accepted as a share of units ordered.
• Fill rate: how much of what you ordered turned up, across finished orders and weighted by units. This falls only when orders are closed short.
• Split deliveries: the share of orders that arrived in more than one delivery.
• Damaged: damaged units as a share of everything that arrived, with "N of M units" underneath.
• Cost variance: how far the landed cost of each unit, with its share of freight and duty, sat above or below the cost on the order. Lines with no cost are left out, and the hint says how many.
• Revised orders: the share of orders that were revised.

A figure with nothing to judge reads No data, never 0%. Below them, Landed cost per unit shows the latest figure, with a trend line once deliveries span more than one day. Compare all suppliers at the top of the tab opens the scorecards for every supplier side by side.

How do you use this?

Before a negotiation, take the on-time rate, the days late and the number of orders scored together, along with the fill rate and cost variance. That is a fact rather than an impression.

When you set a lead time, set the one they actually achieve rather than the one they promise, with Delay spread and When late as your guide. Lead time flows straight into reorder quantities and stock warnings, so an optimistic one quietly under-orders, as How to find out what you need to reorder shows.

To chase the orders behind a poor record, see How to find late orders and plan revisions.