Cost Matrix

Rating Criteria	Price	Price Duration	Cost Reduction	Special Payment Agreements
90 - 100% Preferred Supplier	Price meets or reduces standard costs.	Duration of price agreement extends 12 months and beyond.	Provides evidence of in-house cost reduction program.	Offers discounted payment, terms, consignment and stocking.
80 - 90% Certified Supplier	Consistently meets ESI's agreed upon costs. Quotes are prompt and accurate. Can be depended on to ensure details are included in price. Makes improvements in price quotes through sound cost management programs.	Consistently meets or provides suitable price duration schedule to meet ESI's specification and cost programs.	Consistently strives to improve methods, processes and procedures to ensure the most effective pricing to "customer organization" and other customers.	Always negotiable to meet ESI's requirements Will initiate consignments and stocking programs at enhanced costs to meet ESI's requirements.
70 - 80% Qualified Supplier (Approved candidate)	Generally meets ESI's requirements. Quotes are normally prompt and accurate. Continually works to improve pricing to meet ESI's requirements.	Price duration can generally be negotiated to enhance ESI's delivery commitments on long lead times and changes to initial requirements. Always works towards customer satisfaction within budgetary guidelines.	Has a continuous cost reduction program been in effect to reduce internal failures. Shares results of these programs with ESI.	Willing to negotiate to meet ESI's requirements. Has open policy to meet ever- changing commitments to effect customer satisfaction.
Under 70% Unqualified Supplier (Remove from supplier listing)	Seldom submits competitive pricing. May not respond to quotes.	Normally short duration. May even change quoted price from day to day. Price adjustments are always required and are used to affect delivery and quantities.	Fixed programs. No improvement.	Will not make special agreements. Prices are fixed and other terms are not normally negotiable.