The cheapest quote is rarely the cheapest: how to compare supplier quotes properly

Three quotes arrive for the same 34 line parts list. One is a PDF, one is an Excel file, and one is a price typed into the body of an email. The purchasing manager opens all three, builds a comparison sheet by hand, and picks the lowest total. Two weeks later the accountant asks why there are four delivery invoices, the maintenance manager asks why line 17 is a different brand, and the “cheapest” order has cost more than either of the others would have.

This is not a story about a careless buyer. It is what happens by default when quotes from industrial spare parts suppliers are compared on the number at the bottom. This guide is about comparing them on the things that actually decide the cost.

First, check that the three quotes are for the same thing

Before a single price is compared, line up the quotes against the original list and ask three questions of every line.

Is it the same part? Not the same description, the same manufacturer part number. Suppliers substitute silently more often than anyone likes to admit, sometimes because they do not stock the brand, sometimes because their system auto matched a “similar” item. A quote that says “bearing 6205 2RS” when you asked for SKF 6205 2RS1 C3 has changed the brand and dropped the clearance class, and the price is lower for a reason.

Is it the same quantity and unit? A quote for 1 drum where you asked for 100 metres may be the same thing or ten times as much.

Is every line there? A quote that covers 31 of 34 lines is not comparable with one that covers all 34, and the three missing lines are usually the awkward ones that will take longest to source elsewhere.

Only when every line matches, or every difference is written down, does the price comparison mean anything.

Compare landed price, not list price

Landed price is what the part costs at your door: the goods, plus shipping, plus any handling or small order surcharge, before VAT. It is the only price worth comparing.

Most quotes show the goods price and mention delivery somewhere else, or not at all until the order confirmation. On a small order the difference is large. A 15 euro bearing with 12 euro courier cost is not cheaper than a 22 euro bearing delivered free. Across a list split between three suppliers, three separate deliveries can add more than the total saving from picking the cheapest line each time.

Ask every supplier for delivery cost to your address on the quote itself, and for the surcharge rules. Then add a landed price column to your sheet and compare that column only.

Count the deliveries and the invoices

An order split across three suppliers is three deliveries to receive, check and book in, and three invoices to match against three delivery notes. Nobody puts that time on the quote, but it is real work for real people, and on a small order it is often bigger than the price difference.

If the totals from two suppliers are within a few percent, giving the whole list to one of them is usually cheaper once you count the receiving and the paperwork. The comparison sheet should show, for each scenario, how many deliveries and how many invoices it produces.

Lead time is part of the price

A quote with a lower price and a four week lead time is only cheaper if you can wait four weeks. If the part is for a planned stop in ten days, the four week quote is not a quote, it is a polite refusal.

Record the lead time per line, not per quote. A supplier who has 30 lines in stock and 4 on back order will often quote a single delivery date that is the worst of the 34. Ask whether they will ship the stock lines now and the rest later, and what that does to the shipping cost.

Then decide, before comparing, what matters most on this order: lowest total, delivery by a date, or fastest possible. Different orders have different answers, and the “best” quote changes with the answer.

Price validity and what happens after

Quotes expire. Many industrial distributors hold prices for a week or two, some for 24 hours on volatile items like electronic components. If your approval process takes ten days, a quote valid for seven is a quote you cannot accept as written.

Note the validity date on the sheet. If two quotes are close and one is valid longer, that is a point in its favour, because the alternative is asking for a requote and starting again.

A supplier comparison template you can build in five minutes

Open a blank spreadsheet. One row per line of the original list. Then, for each supplier, four columns: part number quoted, unit price, lead time in days, and a flag for any substitution or missing line. After the supplier blocks, add one column for delivery cost per supplier and a small summary block below the table with, for each supplier, the goods total, the delivery cost, the landed total, the number of lines covered, the longest lead time and the validity date.

That is the whole supplier comparison template. It is not sophisticated, and that is the point. What it does is force every quote into the same shape, so the differences are visible instead of hidden inside a PDF.

If you find yourself building it every week, that is a signal in itself.

Repair or replace is also a comparison

Some lines on a parts list are not really parts. They are a decision about whether to buy new or repair. A rewind on an electric motor from a local workshop will be quoted against a new motor from an industrial parts supplier, and the comparison follows the same rules. Landed price, lead time, and what you actually get: a rewound motor has the same efficiency class it had before, a new one may be better, and a new one comes with a warranty. Put both on the same sheet and compare them the same way.

Where the comparison usually breaks

Three things defeat even a good comparison sheet. The first is that the quotes come in at different times, so the sheet is never complete on the day someone needs an answer. The second is that the “sheet” is built again for every order, by hand, by the same person. The third is that even a perfect comparison tells you what was quoted, not whether the quoting supplier will actually deliver what they quoted.

PartM8 was designed around those three problems. You submit one list, it goes only to suppliers whose catalogue matches the lines, and one consolidated offer comes back within 24 hours. Every line shows the landed price with delivery already included, the lead time, and which supplier it comes from. You tell it up front what matters on this order, lowest price, best price before a date, or fastest delivery, and the offer is assembled by that rule. Prices hold for three days. There is one invoice at the end, whatever the number of suppliers behind it. In other words, the comparison sheet is already built, and it is built the same way every time.

Frequently asked questions

What is landed price? Landed price is the cost of a part delivered to your address: the goods price plus shipping and any surcharges, before VAT. It is the price that should be compared between suppliers, because goods price alone hides delivery costs that can be larger than the price difference.

How many supplier quotes should I get for spare parts? Three is the usual rule, but only if the three are compared properly on the same part numbers and on landed price. Three badly compared quotes are worse than one honest one.

Why do suppliers quote a different brand than I asked for? Usually because they do not stock the brand requested, or because their system matched an equivalent automatically. It is only a problem when it is not stated. Always check the manufacturer part number on the quote against the one on your list.

Is it cheaper to split an order between several suppliers? On the goods price, sometimes. On the total, often not, once separate delivery charges, separate receiving and separate invoices are counted. Compare the landed total per scenario, not per line.