Procurement Cost & Supplier Comparison
Compare two supplier quotations to identify the lower-cost option. Calculate total procurement cost, landed cost per unit, applicable tax, and potential savings.
1. Purchase Requirements
Enter the same purchase quantity for both suppliers so their quotations can be compared fairly.
2. Supplier A
3. Supplier B
Practical Example
A business needs 100 units and receives quotations from two suppliers. Use the following example values to understand the calculation.
| Input | Supplier A | Supplier B |
|---|---|---|
| Purchase Quantity | 100 units | 100 units |
| Unit Price | ₹500 | ₹480 |
| Discount | 5% | 2% |
| Freight | ₹3,000 | ₹4,500 |
| Other Charges | ₹500 | ₹700 |
| Tax | 18% | 18% |
Example Calculation
Supplier A: Goods after discount = ₹47,500. Pre-tax cost = ₹47,500 + ₹3,000 + ₹500 = ₹51,000?
Correct calculation: Goods after discount = ₹50,000 − ₹2,500 = ₹47,500. Pre-tax cost = ₹47,500 + ₹3,000 + ₹500 = ₹51,000. Tax at 18% = ₹9,180. Total procurement cost = ₹60,180, or ₹601.80 per unit.
Supplier B: Goods after discount = ₹48,000 − ₹960 = ₹47,040. Pre-tax cost = ₹47,040 + ₹4,500 + ₹700 = ₹52,240. Tax at 18% = ₹9,403.20. Total procurement cost = ₹61,643.20, or ₹616.43 per unit.
Conclusion: Supplier A is cheaper by ₹1,463.20 for the 100-unit purchase, despite Supplier B’s lower quoted unit price.
Calculation assumption: This calculator applies the entered tax rate to the discounted goods value plus freight and other procurement charges. Actual tax treatment can vary by jurisdiction and charge type. Use the applicable taxable base for your transaction.