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Vendor Selection Process

Vendor selection process The vendor selection process is done during the design work phase of
the project. According to Ted Chronis, there are few crucial things to be considered during
vendor selection of a project. Those things are competitive location-cost, project roadmap,
purpose and objectives of the vendor and so on. However those criteria are associated with the
weightage of the client (Chronis 2007).
The selection of vendor adopts the weighted property index method (WPIM), where originally
the use of the WPIM is for the material selection process. The adoption of this WPIM is the
change of the attributions with the scale rating, and the scale rating uses the Likert scale rating.
The proposed attribution weightage are such as:
Vendor

: Rating x 43.0%

Location (distance)

: Rating x 32.0%

Delivery time

: Rating x 20.0%

Price

: Rating x 5.0%

It was based on the Likert Scale with Rating ranging between 0 and 3, where 0 = worst and 3 =
Best. The price rating is the lowest in this case due to the early delivery of project may provide
bonuses.
The chosen vendors are:

a) Pipe, vales, flanges and fittings


Mitsui is chosen as vendor because of the delivery time is shortest among the other
vendors with the higher rating. Moreover, the price of Mitsui also the lowest between
other vendors.

b) Instrument, installation and Elec. Cable, Switchgear including Computer


Stockist A is chosen as vendor because of its delivery time is the shortest which is 40
weeks among other vendors. The location also nearer with the construction site. Stockist
A has the highest rating, shortest distance (UK), where the construction site is nearer with
UK and Germany) and shortest delivery time, so it should be the best vendor.
c) Mechanical Equipment
Stockist C is chosen as vendor because of it has the shortest distance(Germany), shortest
delivery time with highest vendor rating. The price is taken consider in the lowest in this
case due to the early delivery of project may provide bonuses.
d) Steelwork
Pensou is chosen as vendor because it has a highest vendor rating with the 4 weeks of
delivery time. The company of shortest delivery time was not chosen because of the poor
rating which is 2 and the price is higher than the Pensou which has very good rating.
e) Fire Fighting/Safety Equipment
Mindorf is chosen as vendor because of the rating of the company is very good.
Meanwhile, the location also nearer with construction site, so it has the shorter delivery
time. Although Banham in UK has shortest delivery time which is 19 weeks, but it only
less a week compare to Mindorf. At the same time, the rating of Banham in UK is only in
poor(1) rating.
f) Tankage
Tankraff chosen as vendor because of its nearer with construction site and the duration of
design and erection is shortest. Tankraff has moderate vendor rating.
g) Jetty
CCC chosen as vendor of this project because of it has shortest duration which is 57
weeks compare to others. At the same time, it is the lowest cost among other to
companies and has the moderate rating.
h) Civil Works, Tank Farm, Etc.
Le May chosen as vendor of this project because of it has the highest vendor rating which
is very good. NEC also has the highest vendor rating but the cost is higher about 10000
if compare with Le May.
i) Electric / Installation
Hamdan is chosen as vendor because it has the highest vendor rating with lower duration
which is 20 weeks. Electrome and Panton & Co, in UK has the lowest duration which is
19 weeks, but they are not chosen as vendor because they are only a week faster than
Hamdan but their vendor rating are poor and moderate each. So they are not suitable if
compare with Hamdan.
j) Piping and Piping Equipment Installation

Trudeau is chosen as vendor because of the the duration is taken 69 weeks. It is not the
shortest duration among all the vendors. Press & Co. in UK has the shortest duration
which is 65 weeks. However, we consider that the vendor rating of Press & Co. is only 1
which is poor. So that, Trudeau with moderate vendor rating is chosen as vendor although
the highest vendor rating company is Dailem but it take too long time to complete which
is 80 weeks.
k) Fire Fighting/Safety Equipment Installation
CCC is chosen as vendor because of its shortest duration and the moderate vendor rating.
Electrome has highest vendor rating but is not selected because of the duration are
slowest. It need more 4 weeks duration if compare to ccc.
l) Painting
Pico is chosen as vendor because of its highest vendor rating with shortest delivery time.

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