Iproving decision making: use a spreadsheet to select suppliers

Resources needed: 


A windows PC with Microsoft Excel installed. If you need this software, follow 

these steps to install it.



In this exercise, you will learn how to use spreadsheet software to improve management 

decisions about selecting suppliers. You will filter transactional data about suppliers based on 

several criteria to select the best suppliers for your company.


You run a company that manufactures aircraft components. You have many 

competitors who are trying to offer lower prices and better service to customers, and you are 

trying to determine whether you can benefit from better supply chain management. The 

Assignments area under Week 2, you will find a spreadsheet file 


that contains a list of all the items your firm has ordered from 

its suppliers during the past three months. The fields in the spreadsheet file include vendor 

name, vendor identification number, purchaser’s order number, item identification number and 

item description (for each item ordered from the vendor), cost per item, number of units of the 

item ordered (quantity), total cost of each order, vendor’s accounts payable terms, order date, 

and actual arrival date for each order.

Prepare a recommendation of how you can use the data in this spreadsheet database to 

improve your decisions about selecting suppliers. Some criteria to consider for identifying 

preferred suppliers include: 

the supplier’s track record for on-time deliveries 

suppliers offering the best accounts payable terms 

suppliers offering lower pricing when the same item can be provided by multiple 

suppliers. (extra credit)

Use your spreadsheet software to prepare reports to support your recommendations.

Information about the data:

At a minimum you will need to be able to sort the database by various criteria such as 

item description, item cost, vendor number, or A/P terms

A/P terms is expressed as the number of days that the customer has to pay the vendor 

for the purchase. In other words, 30 designates net 30 days. The vendor that allows 

customers the longest amount of time to pay for an order would, of course, offer the 

most favorable payment terms.

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