Urban Outfitters had to change the way it managed suppliers: Growing 20% a year caused rapid expansion of its vendor base to more than 1,500 suppliers. In response, it is moving from a less-than-systematic approach in which buyers were responsible for discussing violations with vendors to a Product Lifecycle Management system that provides information for vendor scorecards.

In “Urban Outfitters Moves to Vendor Scorecards” (Journal of Trading Partner Practices, June 2009), John Walsh writes, “For years, retailers have relied solely on compliance and deduction policies to manage their suppliers and encourage them to meet their supply chain requirements. However, scorecards offer a more proactive means of measuring supplier performance and enable retailers to closely align themselves with vendors who achieve the highest grades.”

Vendor scorecards also alter the role of a company’s buyers. Rather than spending most of their time enforcing compliance and conveying routing requirements, buyers can now focus on improving supply chain performance. “The need for quick turn and greater efficiencies makes it critical that Urban is communicating with our vendors and, more importantly, making sure they fully understand our requirements,” said Jay Hallett, vendor relations and compliance manager at Urban Outfitters.

In the Organizational Profile, the Baldrige Criteria ask who your key suppliers are and how you communicate and manage relationships with them, what role they play in your innovation processes, and what your key supply chain requirements are. Product Lifecycle Management and supplier scorecards are systematic approaches that can provide good answers to these questions.

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