Difference between a subcontractor and a supplier

Thomas Dorner

Starting to get Involved
#1
Hi,

I am struggling with the definition of a subcontractor and a supplier. What is the difference.
ISO 9000 doesn't help in this matter.

I hope to get some answers from this forum, which helps clarifying this problem.

Thank you,
Thomas
 
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Ninja

Looking for Reality
Trusted Information Resource
#3
If it helps...I draw the line based on whether or not I direct what product is made.

If I buy a box of crayons, it's a supplier.
If I specify I want only black crayons and they specially box it for me...it's still a supplier.
If I have them make a new color just for me...it becomes a rather grey area.
If I specify size, shape, color and material...it's a subcontractor.

But that's me. As Jim said, it's context (not just yours, but your customer's opinion too).

If I stop making a part, and have someone else make it for me...no question, it's a subcontractor.
If I stop making a part because someone else already makes it...and I choose to buy from them, supplier.
 

John C. Abnet

Teacher, sensei, kennari
#4
subcontractor and a supplier
Good day @Thomas Dorner ;
You've received some good advice for considering how to identify each. As you can infer from the responses, while there may be "best"/most appropriate uses of each of the terms, it matters not so much how your organization defines the terms as long as they are applied CONSISTENTLY and commonly within your organization (to avoid confusion...not because of any requirement).

ISO 9000:2015 defines "Provider" (supplier) as follows...
"Organization that provides a product or service."
(pretty broad).

Within that definition it goes on to give examples and notes, which reference terms such as "Producer", "distributor", "retailer", "vendor", "contractor". Each have their ideal "best" application, but as mentioned prior, the ultimate determination of how /where to use any of these terms can be determined by your organization. (I would council that the dictionary may help you in that determination).

Hope this helps.
Be well.
 

Pancho

wikineer
Super Moderator
#5
Anyone retained under contract to perform work is a contractor. If the work to be performed is part of the buyer's fulfillment of another contract where they are the supplier, then the seller is a sub-contractor.

Since all buy-sell transactions have an implicit contract, then all suppliers are technically contractors. But contractor (and sub) is more often associated with at least some service components in the supply and some negotiation in the contract. Suppliers that are not usually thought of as contractors usually include little or no service components, or have non-negotiated supply agreements.

TL;DR terms overlap too much, so we don't worry about the distinction.
 

Miner

Forum Moderator
Staff member
Admin
#6
I always considered suppliers to be the providers of raw materials or component parts. Subcontractors were companies that we would send sub-assemblies out to perform work that we could not do internally such as plating. But, as Jim W said, it is context sensitive.

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Jim Wynne

Staff member
Admin
#9
It would be good to hear from the OP as to why there's concern about the difference. If we follow Miner's model (which is a common way of looking at the question), all subcontractors are suppliers, but not all suppliers are subcontractors.
 

Ninja

Looking for Reality
Trusted Information Resource
#10
It would be good to hear from the OP as to why there's concern about the difference.
Agreed. Is there a clause somewhere prescribing additional effort for one or the other?
all subcontractors are suppliers, but not all suppliers are subcontractors.
Also agreed with this.

I wonder what the term in Miner's model would be if Process 1 were also outsourced...wouldn't Process 2 simply become Process 1, fed by Supplier?
Provider seems like a nice catch-all term.
 
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