Vendor Policy


1. Purpose
The basic purpose of this procedure is to ensure that the vendors / suppliers of all products and services to Star Cement are meeting the QHSE requirements of Star Cement RAK.
This also provides control over all the outsourced activities of the company.

2. Scope
This procedure is applicable for all the suppliers of products and services, of all types to Star Cement Co. LLC, RAK.

3. Definitions and Abbreviations
• SAP – System, Application and Products
• Yellow Pages – Magazine covers list of Industries available in UAE.

4. Responsibilities
• Purchase Manager is responsible for the approval of vendors / suppliers for registration purposes.
• The concerned Purchase office Incharge is responsible for identification, registration, evaluation and re-evaluation of the vendors / suppliers at least once in a year in his respective areas.

5. Procedure
5.1. Selection and approval of suppliers
• Identify the prospective vendors to develop new sources for a particular material /item, through enquiries/Industry References/Other known sources/business journals/yellow pages/Web portal/the vendor approaches the company.
• Get the required details as per Vendor Master Creation Form from the prospective vendors along with the enquiry/product details specification.
• If necessary arrange a visit to the prospective vendor or call the vendor for discussions
• If on evaluation / scrutiny, the vendor is found to be having necessary infrastructure, capability to address environmental aspects, OH&S risks of goods and services supplied and comply requirements including legal and other requirements, put up to the competent authority for the vendor approval.
• Review the vendor registration Form and other details of the vendor and accord approval on the relevant Format for one year.
• On approval as approved vendor enter the details in approved vendor master in SAP.

5.2. Vendor evaluation and performance monitoring
• Annual evaluation on the performance of existing supplier / vendors will be carried out, based on the following main parameters.
o Quality
o Delivery
o Service Support
o Safety
o EHSS / Quality systems etc,
• Yearly, analyse the Safety, Statuary requirement, Service & Quality systems parameters manually and evaluate Quality & Delivery parameters through SAP system.
• For Raw material supplier/Transporters, Vendor rating shall be carried out on the following criteria:
o Quality : 65 %
o Delivery : 15 %
o Service : 10 %
o Environment(EHSS) : 10 %

• For Spares & Consumables supplier, Vendor rating shall be carried out on the following criteria:
o Quality : 50 %
o Delivery : 30 %
o Service : 10 %
o Environment(EHSS) : 10 %

• For Service related supplier, Vendor rating shall be carried out on the following criteria:
o Safety : 40 %
o Service : 25 %
o Statutory Requirement : 15 %
o Commercial Req. : 10%
o Quality System/EHSS : 10 %

• All the rating shall be done on annual basis. Overall rating will be considered for taking decision for future dealings. On the basis of above rating, categorisation is to be done as below.
i. Above 90 % : A (Excellent)
ii. 70 – 89 % : B (Good)
iii. 50 – 69 % : C (Average)
iv. 40 – 49 % : D (Poor)
v. < 40 % : E (Unsatisfactory)
• The performance rating is sent to Vendors/Suppliers annually. Star Cement shall give preference to ‘A’ and ‘B’ category suppliers, however supplies from “C' categories are also taken if required after taking feedback from supplier by HOD (Purchase) for necessary corrective action.
• Supplies from 'D' category suppliers are not made and these are informed by HOD (Purchase) to improve. However, in case of emergencies supplies, from these suppliers can be made on special approval from Functional Head (Tech.) with some agreed actions at suppliers’ end (e.g. deputing personnel for inspection to supplier’s works).
• ‘E’ category vendors will be de-listed and future business dealings to be discontinued. They can be re-introduced subject to improvement in future.

5.3. Re-Evaluation
• In case of supplies found to non-conform to the agreed requirements resulting rejection of items or services even from high rating supplier, re-evaluation of such supplier shall be carried out for revised rating before next transaction.
• The criterion of re-evaluation is same as that of evaluation of suppliers.
• Update the vendor master/SAP on the basis of the review.

6. References/ Related Documents
• ISO 9001:2008 Standard
• ISO 14001:2004 Standard
• OHSAS 18001:2007 Standard
• Work Instruction for Vendor Registration (SCRA-WI-PU-SEV-01)
• Work Instruction for Vendor Evaluation (SCRA-WI-PU-SEV-02)

7. Records & Retention Time

DOCUMENT NAME DOCUMENT NO. LOCATION RESPONIBILITY RETENTION PERIOD
Vendor Master Creation SCRA-FM-PU-SEV-01 Purchase Purchase Manager 3 years
Vendor Evaluation Questionnaire SCRA-FM-PU-SEV-02 Purchase Purchase Manager 3 years
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