Supplier evaluation checklists agree on the shape of the scorecard: quality, delivery and cost, each weighted and scored one to five. None of them price what a quote's unit price actually leaves out. A quote is only comparable to another if both were made on the same basis. An Incoterm sets that basis: whether the buyer still owes freight and duty on top of the printed number, or whether the seller already built both in. Skip that check and the cheaper-looking quote can be the more expensive unit.
Camden Trail Co, an invented outdoor-gear brand, sole-sources its flagship 42-liter backpack from one factory. That factory's on-time rate fell from 100 to 75 percent over four tracked quarters, while its defect rate climbed from 1.10 to 2.89 percent. Requalifying a second source produced three competing quotes. The cheapest sticker price, $8.40 FOB Shenzhen, excludes freight and duty; landed, it is $10.45. A rival quote at $9.65 is DDP, meaning both are already included, so its landed cost is still $9.65. The cheaper-looking quote was not the cheaper unit.
A second adjustment, smaller but real, prices what the payment terms themselves cost: a deposit paid at purchase order ties up cash for the length of a reorder point's whole lead time before there is anything to sell. Together, landed cost and financing cost decide which quote actually wins. The Contingency Note turns a declining performance trend into a named backup before a stockout forces the question, the same trend a chargeback's return pattern shows up in once a bad lot reaches customers instead.
Supplier Evaluation Checklist Template