Vendor Prequalification Summary Template – Free Word Download
Introduction
In modern project management, “doing it all yourself” is rarely an option. Projects rely heavily on a supply chain of vendors, contractors, and service providers. Whether you are outsourcing software development, hiring a construction firm, or purchasing raw materials, the success of your project is inextricably linked to the performance of your vendors. The Vendor Prequalification Summary is the gatekeeper of this supply chain.
This document is typically generated during the Procurement Planning phase, before a Request for Proposal (RFP) is even issued. Its purpose is to filter the market. Instead of inviting 20 random companies to bid (which wastes everyone’s time), you first run them through a “Prequalification Questionnaire” (PQQ) to ensure they meet the minimum viable standards.
This template summarizes the results of that screening. It evaluates potential vendors not just on price (which comes later in the bid phase) but on capability, stability, and compliance. It asks: Is this company financially solvent? Do they have the technical capacity? Is their safety record acceptable? Are they legally compliant?
By completing this summary, the Project Manager and Procurement Lead create a “Shortlist” of approved bidders. This reduces risk significantly. It prevents the nightmare scenario of awarding a contract to the lowest bidder, only to find out halfway through the project that they are bankrupt, uninsured, or using illegal labor.
Section 1: Procurement Scope and Criteria
1.1 Project Procurement Context
Instructions:
Define what we are looking for. This ensures the prequalification criteria match the project needs.
- Project Name: [Enter Name]
- Procurement Package ID: [e.g., PKG-004-Electrical Works]
- Estimated Contract Value: [e.g., $500k – $1M]
- Scope Description: [Briefly describe the goods/services needed. e.g., “Supply and installation of HVAC systems for the new data center.”]
1.2 Evaluation Methodology
Instructions:
How did we score the vendors? Define the logic to ensure fairness.
- Pass/Fail Criteria: [List the “Knock-out” questions. e.g., “Must have valid insurance.”]
- Scored Criteria: [List the weighted areas. e.g., Technical Experience (40%), Financial Health (30%), Safety (30%).]
- Minimum Threshold: [e.g., Vendors must score at least 70/100 to proceed to the RFP stage.]
Section 2: Candidate List
Instructions:
List the companies that applied or were invited to prequalify.
Table 2.1: Vendor Inventory
| Vendor Name | Location | Status | Date Screened |
| Vendor A: Global Tech Solutions | USA | Complete | Oct 10 |
| Vendor B: Budget Builders Inc. | Local | Complete | Oct 11 |
| Vendor C: Fast & Cheap Ltd. | Offshore | Disqualified (Incomplete Info) | Oct 12 |
Section 3: Financial Stability Assessment
Instructions:
You do not want a vendor to go bankrupt while holding your deposit or half-finished product. This section summarizes the financial health check.
3.1 Key Financial Ratios
Table 3.1: Financial Health Check
| Vendor | Annual Turnover (Last 3 Yrs) | Liquidity Ratio (Current Assets/Liabilities) | Profitability | Credit Rating | Assessment |
| Vendor A | $50M (Stable) | 1.5 (Healthy) | Positive | AA | Pass – Low Risk |
| Vendor B | $2M (Declining) | 0.8 (Risky) | Negative | C- | Fail – High Risk |
Guidance:
- Turnover Rule: A common rule of thumb is that your contract should not represent more than 20-30% of the vendor’s annual turnover. If your project is too big for them, they might collapse under the cash flow pressure.
- Liquidity: If the Liquidity Ratio is below 1.0, they may struggle to pay their suppliers, which will delay your project.
Section 4: Technical Capability and Experience
Instructions:
Can they actually do the work? Look at their history.
4.1 Past Performance Reference Check
Table 4.1: Reference Summary
| Vendor | Similar Project Cited | Reference Contacted? | Feedback Summary |
| Vendor A | Data Center for Bank of America | Yes (John Doe, VP) | “Excellent quality, but slightly expensive. Finished on time.” |
| Vendor B | AC Installation for Local School | Yes (Jane Smith, Principal) | “Good work, but the project manager changed 3 times.” |
4.2 Capacity and Resources
Instructions:
Do they have the staff and equipment now?
- Vendor A: Has a team of 50 certified engineers. Currently at 60% utilization. [Pass]
- Vendor B: Small team of 5. Currently fully booked until December. [Fail – Capacity Constraint]
Tips for Success:
Ask for a “Resource Histogram” from the vendor. This shows their staffing levels over time. If they are already overloaded, their “Technical Capability” is irrelevant because they cannot apply it to your project.
Section 5: Health, Safety, and Environment (HSE) Screening
Instructions:
For construction, manufacturing, or field service projects, this is non-negotiable. A vendor with a poor safety record is a liability lawsuit waiting to happen.
5.1 Safety Record Statistics
Table 5.1: HSE Performance (Last 3 Years)
| Vendor | TRIR (Total Recordable Incident Rate) | Fatalities | Safety Certifications | Assessment |
| Vendor A | 0.5 (Industry Leader) | 0 | ISO 45001 | Pass |
| Vendor B | 4.2 (Above Average) | 1 (in 2021) | None | Fail |
Guidance:
- TRIR: Compare the vendor’s rate to the industry average. If it is significantly higher, they have a safety culture problem.
- Fatalities: A recent fatality is usually an automatic disqualification unless they can prove a massive overhaul of their safety systems.
5.2 Environmental Compliance
- Vendor A: Certified ISO 14001 (Environmental Mgmt). Has a waste recycling policy.
- Vendor B: No environmental policy. Cited by EPA for illegal dumping in 2020. [Disqualified]
Section 6: Legal and Compliance Screening
Instructions:
Referencing the “Anti-Bribery Compliance Check” and “Ethics Review,” ensure the vendor is legally clean.
6.1 Background Checks
- Litigation History: [Is the vendor currently being sued? e.g., “Vendor A has one pending lawsuit regarding IP, deemed low risk.”]
- Sanctions List: [Did we run their name against the OFAC/Sanctions database? e.g., “All Clear.”]
- Conflict of Interest: [Does the vendor have any undisclosed ties to our employees? e.g., “None declared.”]
6.2 Insurances
Table 6.1: Insurance Coverage Verification
| Insurance Type | Required Limit | Vendor A Coverage | Vendor B Coverage |
| General Liability | $5,000,000 | $10,000,000 (Pass) | $1,000,000 (Fail) |
| Professional Indemnity | $1,000,000 | $2,000,000 (Pass) | None (Fail) |
| Workers Comp | Statutory | Verified | Verified |
Section 7: Quality Management Systems (QMS)
Instructions:
How do they ensure quality?
- Certifications: [Do they have ISO 9001?]
- Vendor A: Yes, valid until 2025.
- Vendor B: No, they use an internal “Quality Manual” (Unverified).
- Audit Rights: [Did they agree to let us audit their facility?]
- Vendor A: Agreed.
- Vendor B: Refused.
Section 8: Cybersecurity and Data Privacy (If Applicable)
Instructions:
If the vendor will handle your data or connect to your network (e.g., SaaS provider), this section is mandatory.
- Certification: [SOC 2 Type II or ISO 27001?]
- Vendor A: SOC 2 Report available.
- Vendor B: “We use a firewall.” (Insufficient).
- Data Residency: [Where will they store our data?]
- Vendor A: AWS US-East (Compliant).
- Vendor B: Unknown server in home office. (Risk).
Section 9: Prequalification Scoring Matrix
Instructions:
Consolidate the findings into a final score.
Table 9.1: Final Scorecard
| Criteria | Weight | Vendor A Score | Vendor B Score |
| Financial Stability | 25% | 25 (Max) | 10 (Low) |
| Technical Capability | 30% | 28 (High) | 15 (Med) |
| HSE / Safety | 20% | 20 (Perfect) | 0 (Fail) |
| Legal/Insurance | 15% | 15 (Pass) | 5 (Insuff) |
| Quality/ISO | 10% | 10 (Cert) | 0 (None) |
| TOTAL SCORE | 100% | 98 / 100 | 30 / 100 |
| Outcome | SHORTLISTED | REJECTED |
Section 10: Recommendations and Approval
Instructions:
Present the final list of vendors who are “Approved to Bid.”
10.1 The Shortlist
The following vendors have successfully passed the prequalification stage and are recommended to receive the Request for Proposal (RFP):
- Vendor A (Global Tech Solutions) – Highly Recommended.
- Vendor D (Reliable Corp) – Recommended (Note: Need to verify insurance update).
- Vendor E (Innovation Ltd) – Recommended for Technical scope only.
10.2 Disqualified Vendors
The following vendors are rejected and will not be invited to bid:
- Vendor B: Failed Safety and Financial checks.
- Vendor C: Failed Compliance (Sanctions).
10.3 Sign-Off
“I certify that this prequalification process was conducted fairly and in accordance with the organization’s procurement policy.”
- Procurement Manager: ___________________________ Date: __________
- Project Manager: _____________________________ Date: __________
- HSE Manager (if applicable): ____________________ Date: __________
Conclusion – Vendor Prequalification Summary Template – Free Word Download
The Vendor Prequalification Summary is a risk reduction tool. By filtering out the unqualified, the unsafe, and the unstable before the bidding process begins, you save immense amounts of time. You avoid the awkward situation of having to reject the lowest bidder later because they have no insurance.
More importantly, this document protects the project from supply chain failure. When you select a vendor from the “Approved” list, you proceed with confidence, knowing that they have the financial backbone and the technical muscle to deliver what they promise. This “front-loaded” due diligence is one of the hallmarks of a mature project management organization.
Meta Description:
A Vendor Prequalification Summary template to evaluate potential suppliers on financial stability, technical capability, safety records, and compliance before inviting bids.
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