Difference between Supplier and Vendor

Key difference: It is considered that suppliers are vendors, but, in real scenario, they are totally different. The suppliers are ones, who sell the goods/services to the vendors, and from the vendors, these goods/services are sold directly to the customers.

The suppliers are often called as vendors as they are companies that make and sell the parts, materials and machines to the manufacturers that are used to make consumer goods. They can range from manufacturers, processors, packagers, wholesalers, dealers, and merchants, depending upon their work. They can also be any individual or an organization that provides the other organization with the input resources.

In business terms, supplier is ‘a party that supplies goods or services’, which can be distinguished from a contractor or subcontractor, who commonly adds specialized input to the deliverables. Their basic function is to supply the goods and services to respective authority, irrespective of its type or category. They can also sometimes act as the vendors.

Vendors are said to be suppliers, but these are the ones who sell the products directly to the customer. They are providers of the commodities, so their main motive is only to sell. They are known to sell the local items at convenient and affordable rates.

When a vendor returns back the product, he clears his account as he pays for the product, which he had sold retaining his commission or profit percentage, which was fixed beforehand. These are not employed, either full-time or part-time, by the guarantee and are considered as a purchased service. They are also not subject to the compliance requirements; hence they operate in a competitive environment and provide services or goods to many different purchasers.

They generally apply to those, who are immediate vendors, or the organizations that are paid for the goods, rather then to the original manufacturers or organizations performing the services. They are often managed with the vendor compliance checklist or vendor quality audits.

Comparison between a Supplier and Vendor:




Who are they

They are individuals, companies or other organizations which provide goods or services to a recognizable customer or consumer.

They are individuals or firms hired to provide a specific service or product (product purchase or fee-for-service) within their normal business operations.


Their motive is to supply the goods and products.

Their motive is to sell the goods and products.


They can be manufacturers, processors, packagers, wholesalers, dealers, and merchants.

They may or may not be manufacturers, processors.

Provides link between

They sometime acts as a link between the manufacturer and the customer.

They are in direct concern with the end-customer.

Type of relation

Their relationship with the respective authority matters and affects the transaction and profit.

Their relation ends with in a contractual base, and is not that affecting, but only concerned from a profit point of view.

Quantity and type.

They supply the commodity of any type in bulk quantity.

They may sell the commodity, generally of local type in bulk or in small quantity.

Clearance of account

The suppliers account is not cleared fully.

The vendors account is cleared within the fixed period base.

Relation with the customer

The suppliers are not that close to the end customer compared to the vendor.

The vendors are more close to the end customer than the supplier.


There were many more software suppliers at the trade show this year.

The hotdog vendor on the corner sells.

Image Courtesy: blog.cbfnet.co.uk, mansfieldrestoration.com

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