Certification in Supplier Diversity Practice Exam

What is the definition of prequalified suppliers?

1. Suppliers who are universally accepted without screening

2. Suppliers added to an organization's approved list after passing preliminary screening

3. Suppliers who are in the process of becoming certifiable

4. Suppliers that do not meet any established standards

The correct answer is: Suppliers added to an organization's approved list after passing preliminary screening

Prequalified suppliers refer to those vendors or service providers that have been evaluated and vetted through a preliminary screening process. This screening involves assessing a supplier's capability, reliability, financial stability, and adherence to specific criteria established by the organization. Once suppliers pass this initial evaluation, they are added to an approved list, which signifies their eligibility to bid for contracts or engage with the organization in a more formal capacity. This process is critical in supplier diversity initiatives as it ensures that the suppliers who are engaged meet the necessary qualifications to provide goods or services effectively and in line with the organization's diversity goals. By maintaining a list of prequalified suppliers, organizations can streamline their procurement process, reduce risk, and promote business with diverse suppliers who have demonstrated their competency.