Supplier Evaluation Form
A Supplier Evaluation Form is a document used to record a supplier's performance, compliance and capability. In Australia, it helps businesses meet due diligence under the Work Health and Safety Act 2011 and ensures supply chain reliability.
A structured tool used by Australian businesses to assess and record the performance, compliance, and reliability of their suppliers and contractors.
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About this Document
A Supplier Evaluation Form is a structured document that Australian business owners and tradespeople use to measure how well a supplier is performing. It helps you check if the people and companies you work with are reliable, safe and follow the law. In Australia, you have a legal duty to make sure your suppliers do not create risks for your business or your clients. This is especially true if you work in construction, manufacturing or any trade where safety is critical. This form acts as evidence that you have done your due diligence. It also helps you decide if you should keep using a supplier or find a new one. You need this document when you start working with a new supplier and at regular times after that. It is vital when you buy expensive materials or hire subcontractors. You also need it if a supplier makes a mistake or fails to deliver on time. Keeping good records protects your business if there is a dispute or an investigation. You also need these records to show the ATO or auditors that you manage your business well. Under the Work Health and Safety Act 2011, you have a primary duty of care. This means you must ensure the health and safety of other people. This duty extends to the work done by suppliers and contractors. If a supplier brings unsafe equipment onto your site, you can be liable. If a supplier sends workers who are not trained, you can be liable. Using a form to check their safety records and insurance helps you meet this duty. The Fair Work Act 2009 also affects how you manage suppliers. You must make sure you are not sham contracting. This happens when you call an employee a contractor to avoid paying entitlements. A proper evaluation helps you prove that the supplier is running their own business and is not just an employee in disguise. You need to check their ABN and insurance details. The Corporations Act 2001 and ASIC rules require you to keep accurate financial records. Supplier evaluations help you track costs and value for money. This is important for your tax obligations and for managing your cash flow. If you deal with building and construction, the Security of Payment Act laws in your state may apply. These laws often require strict record keeping of contracts and work performed. A Supplier Evaluation Form supports your records under these laws. To complete the form, you start by gathering basic information. You need the supplier's full business name, ABN and contact details. You need to know who your main contact person is. You must verify that their ABN is active using the Australian Business Register. You should ask for their public liability insurance certificate and check the expiry date. If they do work for you, you must check their workers compensation insurance. This is mandatory in most states. Once you have the details, you assess their performance. You look at the quality of the goods or services they provide. You check if deliveries arrive on time. You look at how they handle problems or returns. You rate their communication skills. It is important to be honest and objective. You should use a rating system, like one to five, to keep things fair. You must keep the completed form in your records. You should store it with the contract and invoices. It is good practice to review suppliers every six to twelve months. This helps you catch issues early. It also gives you data to negotiate better prices or terms. There are specific legal requirements you must think about. If you are a principal contractor under the WHS Act, you must manage the risks of subcontractors. You must exchange information with them. You must consult with them about safety matters. The evaluation form is a place to record these consultations. You should note if they have provided Safe Work Method Statements (SWMS) for high risk work. You should check if their plant and equipment is tagged and tested according to AS/NZS 3760. This standard relates to the in-service safety inspection of electrical equipment. If a supplier fails these checks, you must not use them. If you do, you breach your duty of care. Another key area is privacy. The Privacy Act 1988 covers how you handle personal information. When you evaluate a supplier, you might hold details about their employees or their business practices. You must keep this information secure and only use it for the intended purpose. You should tell the supplier why you are collecting the data. Common mistakes to avoid are easy to fix. One big mistake is failing to check insurance. Many businesses assume a supplier is insured but never ask for the certificate. If the supplier causes damage or injury, your business might have to pay. Another mistake is ignoring poor performance because it is awkward to complain. If you do not record issues, you cannot fix them. If the problem gets worse and causes an accident, your lack of action looks bad in court. Do not use vague language in your evaluation. Write clearly about what went wrong and what went right. Do not rush the process. A quick check over the phone is not enough. You need a formal record. Do not forget to evaluate administrative performance. Late invoices or missing paperwork can cause cash flow problems for you. A good supplier is easy to deal with in every way. Using a standard template helps you be consistent. It ensures you check every supplier against the same criteria. This is important if you ever need to defend a decision to terminate a contract. In Australia, unfair contract terms can be an issue, so keeping good performance records gives you a valid reason for ending a business relationship. For tradespeople, suppliers are the lifeblood of the job. If the timber is warped or the steel is late, the whole project stops. The evaluation form helps you track these trends. If one supplier consistently fails, the data proves it is time to switch. This protects your reputation with your own clients. It also shows your clients that you run a professional operation. Many head contracts and government tenders now require supply chain management. They want to see that you manage your suppliers responsibly. This form proves you have systems in place. In summary, a Supplier Evaluation Form is a risk management tool. It is not just paperwork. It is a key part of running a safe and profitable Australian business. It helps you meet your duties under the WHS Act, the Fair Work Act and tax laws. It ensures you get value for money. It protects you from legal action. By making this a regular habit, you build a stronger business. You create a network of reliable partners who help you succeed.
Key Facts
- Businesses have a primary duty of care under the Work Health and Safety Act 2011 to ensure the conduct of their business does not pose risks to health and safety.— Work Health and Safety Act 2011 (Cth)
- Principal contractors must ensure that subcontractors and suppliers hold adequate workers compensation insurance where required by state law.— Safe Work Australia
- Businesses must verify the Australian Business Number (ABN) of suppliers to avoid withholding tax at the top rate.— Australian Taxation Office (ATO)
- Sham contracting arrangements are illegal under the Fair Work Act 2009 and treating an employee as a contractor can result in heavy penalties.— Fair Work Act 2009 (Cth)
- Regular evaluation of suppliers assists in demonstrating continuous improvement under AS/NZS ISO 9001 quality management standards.— Standards Australia
Sources
Required Sections
Supplier Details
Captures the core identification and contact information of the supplier.
Supplier Details
You must complete this section accurately before starting any evaluation. The information you provide here acts as the primary record for your business relationship. It is essential for verifying the supplier is a legitimate trading entity operating within Australia. Incorrect details can cause problems with tax obligations, insurance claims, and legal liability if disputes arise later.
Supplier Full Name Record the exact legal name of the business or individual. Check this name against official contracts, tax invoices, and the Australian Business Register. For sole traders, you must list the individual's legal name. For partnerships or companies, list the full registered business name. Using a trading name alone is not sufficient for legal documents.
Australian Business Number (ABN) Enter the 11 digit ABN without spaces. You must verify this number on the Australian Business Register website before proceeding. A valid ABN confirms the business is registered for Goods and Services Tax (GST) if required. Working with a supplier that does not quote a valid ABN may impact your ability to claim input tax credits under the A New Tax System (Goods and Services Tax) Act 1999. Ensure you keep records of these checks to satisfy Australian Taxation Office (ATO) audit requirements.
Physical Address Provide the street address where the supplier conducts its operations. A post office box is not acceptable as a physical address. This information is necessary to serve legal notices if the relationship breaks down. It also helps you assess logistical capability and response times for maintenance or warranty work.
Phone Number List a direct business line or mobile number. This ensures you can reach the supplier urgently if safety issues arise or if work fails to meet standards under the Australian Consumer Law.
Primary Contact Person Write the full name of the person responsible for managing the account. This individual should have authority to make decisions regarding pricing, scope of work, and contract variations. Having a designated contact person streamlines communication and ensures you comply with duty of care requirements under the Work Health and Safety Act 2011. You need a clear line of communication to manage risks on site effectively.
Compliance Check
Verifies that the supplier holds current insurance and meets legal registration requirements.
Compliance Check
You must verify these items before work commences to ensure your business meets Australian legal obligations and manages risk effectively. Failing to check these details can lead to significant fines and liability for unpaid entitlements or workplace incidents.
Australian Business Number (ABN) Status Verify the supplier holds a valid ABN. You can check this instantly using the Australian Business Register (ABR) lookup tool. Under the Taxation Administration Act 1953, you generally cannot claim Goods and Services Tax (GST) credits for business supplies unless the supplier provides a valid tax invoice showing their ABN. If a supplier does not quote an ABN, you may need to withhold 47 percent of the payment. Ensure the ABN on the invoice matches the ABN on the contract and the ABR records.
Public Liability Insurance Ask the supplier to provide a current Certificate of Currency for Public Liability Insurance. This policy protects your business if the supplier causes property damage or personal injury to a third party while working for you. A minimum coverage of $20 million is standard in the Australian construction and trades industries. Check the certificate to ensure your business is listed as an interested party if required, and confirm the policy expiry date is within the contract period.
Workers Compensation Insurance This check is mandatory. If the supplier engages employees, subcontractors, or apprentices, they must hold a Workers Compensation insurance policy applicable in their state or territory. For example, in New South Wales this is managed by icare, while in Victoria it is WorkSafe. You should request a Certificate of Currency to confirm coverage. Under various state Workers Compensation Acts, a principal contractor can be liable for the premiums of uninsured subcontractors. Verifying this insurance prevents unexpected liabilities for claims related to workplace injuries.
WHS Induction Status Confirm the supplier has completed a site-specific Workplace Health and Safety induction. This is a requirement under the Work Health and Safety Act 2011 (Cth) and corresponding state legislation. As a person conducting a business or undertaking, you have a duty to ensure the health and safety of workers. You must check that the supplier understands your site safety rules, emergency procedures, and hazard reporting processes. Keep a record of the induction date and the person who conducted it. This evidence is if Safe Work investigates an incident on your site.
Performance Assessment
Rates the supplier on quality, timeliness, communication and value for money.
Rating Scale
Please rate the supplier's performance by circling one number in each row. A score of 1 represents poor performance, while 5 represents excellent performance.
| Performance Criteria | 1 (Poor) | 2 (Fair) | 3 (Average) | 4 (Good) | 5 (Excellent) |
|---|---|---|---|---|---|
| Quality | 1 | 2 | 3 | 4 | 5 |
| Delivery | 1 | 2 | 3 | 4 | 5 |
| Communication | 1 | 2 | 3 | 4 | 5 |
| Value for Money | 1 | 2 | 3 | 4 | 5 |
General Comments
Guidelines for Assessment
When you assess a supplier, you must look beyond the price tag and consider how their materials or services impact your business reputation. As a tradesperson or small business owner in Australia, you are responsible for the work you sign off on. If a supplier provides faulty goods, you risk breaching your own contracts with clients. You should judge Quality based on relevant Australian Standards. For example, electrical materials must comply with AS/NZS 3000, while building materials should meet the performance criteria of the National Construction Code. If the product fails to meet these benchmarks, you cannot justify a high score.
Delivery performance is about reliability, not just speed. Consistent delays can stall your projects and cost you money. Under the Australian Consumer Law, which is part of the Competition and Consumer Act 2010, suppliers must guarantee that supplies will be provided within a reasonable time if a specific timeframe was not set. Record how often they meet their promised dates. Frequent late deliveries indicate a supplier who does not respect your schedule or your deadlines.
Communication is critical for resolving problems quickly. You need a supplier who responds to phone calls and emails promptly. Poor communication often leads to disputes. The Franchising Code of Conduct and other industry regulations emphasise the need for good faith dealings. This standard of honesty and cooperation should apply to all your business relationships. If a supplier hides information or is difficult to contact, you should rate them poorly in this section.
Value for Money is different from simply being the cheapest option. You must assess the total cost of doing business with this supplier. This includes the durability of their products, their credit terms, and their warranty support. A cheap product that fails after six months offers poor value. Warranties are legally binding promises under Australian Consumer Law. A supplier who honours their warranty without a fight offers true value for money. Use the comment box to note specific incidents, such as defective batches or missed delivery windows. This record is essential evidence if you need to terminate a contract due to consistent underperformance.
Incident Reporting
Records any safety incidents or quality failures that occurred during the reporting period.
Incident Reporting
Number of Safety Incidents
[Enter total number]
Details of Non-Conformance
[Text box]
You must report every safety incident, no matter how small. Keeping an accurate record of these events is not just good practice. It is a legal requirement under the Work Health and Safety Act 2011. This Act imposes a primary duty of care on all businesses to ensure, so far as is reasonably practicable, the health and safety of workers and other people. Failing to report or investigate an incident can lead to heavy fines and prosecution.
If you answer "zero" in the number field, you must still be vigilant. You should review your internal safety management systems regularly to ensure this zero harm record is maintained. If you enter a number greater than zero, you must be prepared to substantiate this with evidence during an audit or review.
Use the text box to describe any non-conformance. A non-conformance is a failure to meet a specific requirement. This could be a failure to follow a safe work method statement, a defect in personal protective equipment, or a breach of the Code of Practice relevant to your trade. You should provide a clear account of what happened and why it happened.
For serious incidents, specific regulations apply. Under the Work Health and Safety Regulations, you must notify Safe Work Australia or your state regulator immediately if a person dies, suffers a serious injury or illness, or there is a dangerous incident. This notification is separate from this evaluation form, but the details you record here should align with your statutory reports.
When describing a non-conformance, include the date and location of the event. Mention the root cause if it is known. For example, did the incident occur because a guard was missing from a machine? Did it happen because a worker skipped a mandatory step? This level of detail helps identify trends and prevents recurrence. It demonstrates a commitment to continuous improvement and compliance with Australian Standards such as AS/NZS 4801 or the newer ISO 45001.
Be honest in your reporting. Concealing incidents is a breach of your duty of care and invalidates your insurance coverage. Providing full and accurate details allows the principal contractor to assess your safety performance accurately. It ensures that everyone on site understands the risks and works together to eliminate them. Keep your records up to date. Accurate data is essential for managing risk and protecting your business.
Overall Rating and Decision
Summarizes the score and provides a recommendation on whether to continue the relationship.
Overall Rating and Decision
Total Score Add up the scores from each section of this evaluation form and record the total number here. This final figure gives you a clear numerical value for the supplier’s performance. You must compare this total against your internal approval matrix. If the supplier does not meet your minimum pass mark, you cannot proceed with the contract without a senior manager signing off on the risk. A low total score suggests the supplier might not meet the obligations set out in the Australian Consumer Law for supplying fit for purpose goods and services. Keep a copy of this calculated score in your business records. If a dispute arises later regarding the quality of work, this documented evidence helps prove you exercised due diligence in selecting a competent contractor.
Recommendation Select the option that best matches your findings from the assessment.
- Approved: The supplier meets all safety, quality, and legal requirements.
- Approved with Conditions: The supplier can work, but you must fix specific issues first. You might limit their scope of work or require extra supervision.
- Not Approved: Do not engage this supplier. They pose too great a risk to your business operations or reputation.
If you choose Approved, ensure the supplier holds a current Australian Business Number (ABN) and valid insurance for the type of work they perform. For high risk work, check their White Card status and SafeWork NSW licences or WorkSafe Victoria registrations. Verifying these credentials is essential to comply with your duty of care under the Work Health and Safety Act 2011 (Cth). You must be satisfied the supplier is not using illegal labour or sham contracting arrangements, which breaches the Fair Work Act 2009.
Required Actions Use this space to list the specific steps you must take before work starts or the conditions the supplier must meet. Be clear about who does what. For example, you might write "Supplier to provide updated Public Liability Insurance Certificate showing $20 million cover" or "Site manager to review induction manual with supplier team before Monday."
If there are safety concerns, describe the control measures needed to meet the Code of Practice relevant to the job. If the decision is to reject the supplier, document exactly why. This helps you avoid potential claims of adverse action or discrimination under the Fair Work Act or anti-discrimination law. You must keep these records for a minimum of five years, as required by the Corporations Act 2001 or Australian Taxation Office regulations. Make sure a senior manager reviews and signs off on these actions to ensure accountability.
Signatures
Formal approval of the evaluation by the evaluator and management.
Signatures
You must sign and date this form to verify that the supplier assessment has been completed properly. In Australia, a signature represents your acceptance of the information recorded above. It is a legal declaration that you have performed your due diligence on the supplier. This section applies to all types of businesses including sole traders, partnership structures, and proprietary limited companies.
The Evaluator must sign to confirm the evaluation is accurate. Under the Competition and Consumer Act 2010 and the Australian Consumer Law, you have an obligation to ensure your suppliers are capable of delivering goods and services that are fit for purpose. If you accept a supplier who provides non-compliant products, your business may be liable for misrepresentation or defective goods. Your signature confirms you have checked the supplier licenses, insurance, and technical capability.
The Manager must also sign to approve the onboarding or ongoing use of the supplier. This oversight is a key part of good corporate governance. It helps manage risk and ensures that purchasing decisions align with business standards. For larger projects or government tenders, this signature chain acts as an internal control to prevent fraud and ensure quality assurance.
Ensure the dates are written clearly in the format DD/MM/YYYY. Accurate record keeping is essential for tax purposes and compliance with Australian Securities and Investments Commission regulations. If you store this record digitally, a digital signature is acceptable under the Electronic Transactions Act 1999, provided the method is reliable and identifies the person signing.
Keep the completed form in your business records. You may need to produce these documents during a workplace audit or to demonstrate compliance with Safe Work Australia standards regarding contractor management.
Evaluator Signature
Date: __ / __ / 20____
Manager Signature
Date: __ / __ / 20____
Frequently Asked Questions
What is a Supplier Evaluation Form?
When do I need a Supplier Evaluation Form?
Is a Supplier Evaluation Form legally required in Australia?
What details must I check for WHS compliance?
How does this form help with tax compliance?
Can I use this form to terminate a supplier?
Who is responsible for completing the evaluation?
How long should I keep these records?
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