Vendor vs Contractor: Difference and Comparison

Vendors and Contractors are both very important parts of any business organization. If a businessman uses these two aids with utmost optimization, he/she can take his/her business to a higher level.

Key Takeaways

  1. A vendor is a company or individual that provides goods or services to another company or individual.
  2. A contractor is a person or company that performs specific tasks or services for another person or company under a contract.
  3. Vendors provide goods or services, while contractors provide specialized services or perform specific tasks.

Vendor vs Contractor

The difference between a vendor and a contractor is that while vendors sell products and remain in touch with the business longer, contractors are just a part of the organization to complete a specific task assigned to them and hence have a very short-term touch with the business.

Vendor vs Contractor
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Business Quiz

Test your knowledge about topics related to business

1 / 10

Who is the servant of the firm with a share in the profits?

2 / 10

Shares traded through stock exchanges are called __________.

3 / 10

Importing goods for the purpose of re-export is termed as ___________.

4 / 10

The Standard of living is the number of goods and services people can buy with the money they have.

5 / 10

The management of the company is entrusted to __________.

6 / 10

Overall and strategic planning is done by the ___________.

7 / 10

Which of the following countries are part of the WTO?

8 / 10

Whose Liability is limited to the extent of his capital to the firm?

9 / 10

Economic activities are related to ___________.

10 / 10

When an existing company offers its shares for sale to the existing shareholders, it is known as ___________.

Your score is

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A vendor is an individual who sells products to various other individuals or businesses. At the same time, a Contractor is a person hired by an individual or a person for a certain goal to be completed within the given period.

A vendor aims to provide good quality goods timely while a contractor aims to complete the assigned task efficiently and on time.

Comparison Table

Parameter of ComparisonVendorContractor
DefinitionA vendor is an individual who sells products to various other individuals or businesses.A contractor is a person who is a part of the organization for a certain goal to be completed within the given time period.
PeriodThe vendors work for a long-term period.The Contractors work for a short-term time period as they leave the organization as soon as the assigned task is completed.
ObjectiveThe main objective of a vendor is to provide good quality products timely.The main objective of a contractor is to efficiently do the task assigned to him in the given time and also meet all the expectations that the employer has for him/her.
Analysis of PerformanceThe analysis of a vendor’s performance is done by his/her delivery time and quality of products.The analysis of a contractor’s performance is done at the time of the completion of the task assigned to them. Legal actions can also be taken when the contractor falls short of expectations or cannot finish the task on time.
Scope Vendors can sell their products to both small and large businesses.A contractor can provide his/her services to an individual, business, or group of individuals looking to get a particular task done.

What is a Vendor?

A vendor is an individual who sells products to various other individuals or businesses. They work on a long-term basis and aim to provide good quality products on time.

A vendor’s performance is analysed by his/her delivery time and quality of products. The scope of doing business is wide as they can do business with small and large businesses.

Anyone who provides goods and services to another entity can be called a vendor. A vendor can also be a manufacturer; however, one must not confuse the two.

While the manufacturer is the one who makes the goods, the vendor is the one who sells them to other entities. In simple words, if you buy some goods, the person to whom you pay for those goods is the vendor.

vendor

What is a Contractor?

A contractor is a person who is a part of the organization for a certain goal to be completed within the given time period. They work for a short time period as they leave the organization as soon as the assigned task is completed.

The main objective of a contractor is to efficiently do the task assigned to him in the given time and also meet all the expectations that the employer has for him/her.

The analysis of a contractor’s performance is done at the time of the completion of the task assigned to them. Legal actions can also be taken when the contractor falls short of expectations or cannot finish the task on time.

A contractor can provide his/her services to an individual, business, or group of individuals looking to get a particular task done within a specific period.

contractor

Main Differences Between Vendor and Contractor

  1. A vendor is an individual who sells products to various other individuals or businesses. On the other hand, a contractor is a person who is a part of the organization for a certain goal to be completed within the given period.
  2. The vendors work for a long-term period, while the contractors work for a short-term period as they leave the organization as soon as the assigned task is completed.
  3. The main objective of a vendor is to provide good quality products timely. On the other hand, the main objective of a contractor is to efficiently do the task assigned to him in the given time and meet all of the employer’s expectations of him/her.
  4. A vendor’s performance is analysed by his/her delivery time and quality of products. On the other hand, the analysis of a contractor’s performance is done at the time of the completion of the task assigned to them. Legal actions can also be taken when the contractor falls short of expectations or cannot finish the task on time.
  5. Vendors can sell their products to both small and large businesses. At the same time, a contractor can provide his/her services to an individual, business, or group of individuals looking to get a particular task done.
Difference Between X and Y 2023 04 21T154258.477
References
  1. https://journals.sagepub.com/doi/abs/10.1177/0275074012454374
  2. https://www.sciencedirect.com/science/article/abs/pii/S0263786309000489
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