Vendors and Contractors are both very important part of any business organization. If a businessman uses these two aids with utmost optimization he/she can take his/her business to a level higher.
Vendor vs Contractor
The difference between a vendor and a contractor is that while vendors sell products and remain in touch with the business for a longer time period, 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.
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A vendor is an individual who sells products to various other individuals or businesses. While a Contractor is a person hired by an individual or a person for a certain goal which is to be completed within the given time 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 Comparison | Vendor | Contractor |
|---|---|---|
| Definition | A 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 which is to be completed within the given time period. |
| Time Period | The vendors work on a long term time period. | The Contractors work on a short term time period as they leave the organization as soon as the assigned task is completed. |
| Objective | The 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 from him/her. |
| Analysis of Performance | The 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 the expectations or could not get the task done 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 a group of individuals who are 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 their main objective is to provide good quality products timely.
The analysis of a vendor’s performance is done by his/her delivery time and quality of products. They scope of doing business is very wide as they can do business with both small and large businesses.
Anyone who provides goods and services to some other entity ca be called as a vendor. A vendor can also be a manufacturer however one must not confuse between 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 make the payment for those goods is the vendor.
What is a Contractor?
A contractor is a person who is a part of the organization for a certain goal which is 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 from 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 the expectations or could not get the task done on time.
A contractor can provide his/her services to an individual, business, or a group of individuals who are looking to get a particular task done within a specific time period.
Main Differences Between Vendor and Contractor
- 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 which is to be completed within the given time period.
- The vendors work on a long term time period while the contractors work on a short term time period as they leave the organization as soon as the assigned task is completed.
- 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 also meet all the expectations that the employer has from him/her.
- The analysis of a vendor’s performance is done 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 the expectations or could not get the task done on time.
- Vendors can sell their products to both small and large businesses while a contractor can provide his/her services to an individual, business, or a group of individuals who are looking to get a particular task done.
- https://journals.sagepub.com/doi/abs/10.1177/0275074012454374
- https://www.sciencedirect.com/science/article/abs/pii/S0263786309000489
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Chara Yadav holds MBA in Finance. Her goal is to simplify finance-related topics. She has worked in finance for about 25 years. She has held multiple finance and banking classes for business schools and communities. Read more at her bio page.
