Active Vendor –

An active vendor is a supplier, contractor, or service provider with whom an organization is currently engaged in ongoing business transactions. This includes vendors who are regularly providing goods or services, fulfilling contracts, receiving payments, or actively participating in procurement or operational processes.

Key Characteristics of an Active Vendor:

• Current Engagement: The vendor has open purchase orders, active contracts, or recent invoices.
• Regular Interaction: There is frequent communication and ongoing exchange of goods or services.
• System Recognition: The vendor is marked as “active” in the organization’s vendor master data or ERP (Enterprise Resource Planning) system.
• Compliance: The vendor meets the organization’s compliance and qualification standards (e.g., insurance, certifications, tax documentation).
• Performance Monitoring: Their performance is monitored or reviewed periodically for quality, delivery, and service standards

Why Distinguish Active Vendors?

• Efficient Procurement: Helps purchasing departments prioritize and streamline sourcing activities.
• Risk Management: Ensures engagement only with compliant and vetted suppliers.
• Financial Oversight: Supports budgeting, reporting, and audit tracking by focusing on vendors with current financial transactions.
• Vendor Lifecycle Management: Distinguishes them from inactive, suspended, or prospective vendors for clearer relationship tracking.