# New Supplier Selection and Due Diligence Checklist > Source: https://netray.co/tools/new-supplier-selection-due-diligence-checklist > Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems. > Section: Free Tools ## Short answer A checklist of 30 checks to run before approving a new supplier for production parts, grouped by financial, quality, compliance, capacity and commercial terms. ## Category supply-chain ## Audience - Buyer - Supplier quality - Procurement manager ## Tool **Kind:** checklist **Groups:** #### Company and financial standing **Items:** **Text:** Legal entity name, registration number and address verified against official records **Critical:** true Ownership structure and ultimate parent identified **Text:** Two or three years of financial statements or a credit report reviewed **Critical:** true Dependence on one customer or one product line assessed Insurance certificates obtained for liability and property **Text:** Bank details verified through a call-back to a known number **Critical:** true **Text:** Sanctions and denied party screening completed **Critical:** true #### Quality system **Items:** **Text:** Current quality certificate obtained and checked with the issuing body (for example ISO 9001, IATF 16949, AS9100) **Critical:** true Scope of certificate covers the processes you are buying Audit report or on-site audit completed Calibration control for measuring equipment confirmed Corrective action process and sample 8D or CAPA reviewed Incoming inspection and final inspection method documented **Text:** Special process approvals held where required by the customer **Critical:** true **Text:** Sample or first article accepted before production orders **Critical:** true #### Capacity and capability **Items:** Equipment list matches the part requirements **Text:** Capacity checked against your forecast with a utilisation margin **Critical:** true Quoted lead time validated against current backlog Sub-tier suppliers identified and flow-down requirements agreed Business continuity or disaster recovery plan reviewed Tooling ownership and storage conditions documented #### Compliance and risk **Items:** **Text:** Country-specific export, import and origin requirements identified **Critical:** true Conflict minerals, REACH and RoHS declarations collected where applicable Code of conduct and anti-bribery commitments signed **Text:** Data security expectations agreed for technical drawings **Critical:** true Geographic and single-source concentration risk recorded #### Commercial and ERP setup **Items:** **Text:** Price, price breaks, minimum order quantity and currency agreed in writing **Critical:** true Payment terms and Incoterms rule with named place agreed Quality agreement and purchase order terms signed Vendor master record created with approval workflow Approved supplier list updated and item-to-supplier links maintained Scorecard measures and review cadence communicated **Scoring Note:** Do not approve a supplier for production parts until every critical item is complete. Non-critical gaps can be accepted with a documented action and due date. ## Content **Intro:** Approving a supplier from a price quote alone is how late shipments and escapes start. This checklist covers the checks that matter before a new manufacturing supplier gets its first production purchase order. **Sections:** #### How to use the checklist **Body:** Work through the groups in order and tick items as you collect evidence, not as you hear assurances. Store the certificate, report or email behind each tick with the supplier file. Critical items are the ones that should block approval. Run the checklist again at renewal or when the supplier changes site, ownership or process. Scale the effort to risk: a catalogue fastener supplier needs less than a machined flight-critical part. **Bullets:** - Collect evidence for every tick, not verbal confirmation - Run a lighter version for low-risk commodities - Repeat on change of ownership, site or process #### Why these checks **Body:** Financial checks reduce the risk of a supplier failing mid-contract. Quality checks confirm that the system exists and that its scope covers your process. Certificates should be verified with the issuing body, because forged or expired certificates do occur. Capacity checks avoid promises the shop cannot keep. Bank detail verification by call-back guards against payment fraud, one of the most common supplier master data attacks. #### Common mistakes **Body:** Teams often accept a certificate whose scope does not include the process being purchased, such as heat treatment or plating. Others skip sub-tier visibility and learn about a single-source casting vendor only during a shortage. Another mistake is creating the vendor master record before approval is complete, so purchasing can order from a supplier that has not passed review. Make approval status a hard control in your ERP vendor record. **Cta:** Netray can help wire supplier approval status, certificates and scorecard data into your ERP so unapproved suppliers cannot receive orders. **Faq:** #### How long should supplier due diligence take? **Answer:** For a low-risk catalogue supplier, a few days of document checks may be enough. For a custom machined or special process supplier it can take weeks, including an audit and first article. Time spent here is cheaper than a quality escape or a supply interruption later. #### Do I need an on-site audit for every supplier? **Answer:** Not always. Base it on risk: criticality of the part, the supplier's certification, past performance and whether a special process is involved. A remote audit or a questionnaire with evidence can suit lower-risk sources. High-risk and sole-source suppliers should be visited. #### How do I verify a quality certificate? **Answer:** Contact the certification body or use its public database to confirm the certificate number, scope and expiry. For aerospace, the OASIS database lists AS9100 certificates. Do not rely on a PDF alone, and diarise the expiry date. #### What should be agreed before the first order? **Answer:** At minimum agree price and currency, payment terms, Incoterms with named place, lead time, quality requirements, first article or sample approval and the governing purchase terms. Write them into the quote acceptance or a framework agreement so both sides work from one document. ## Search terms supplier selection checklist, new supplier due diligence checklist, vendor qualification checklist, supplier onboarding checklist, supplier evaluation checklist manufacturing, supplier approval checklist, vendor vetting checklist --- Talk to an engineer: https://netray.co/contact?intent=erp_ai | Machine catalog: https://netray.co/agent/catalog.json