1.0            Scope

The “supplier documents” , known as the Terms and Conditions (also known as T’s & C’s) and Quality Clauses apply when referenced on Purchase Orders or contracts issued by KMI Inc. The Purchase Order flows down applicable KMI customer Engineering Drawings and specifications. KMI supply chain quality must approve deviations to the requirements herein. Requests for deviation shall be documented by the supplier and submitted to Supply Chain Quality via email or fax. In the event that the purchase order or contract conflicts with the T’s & C’s or the Quality Clauses, the purchase order/contract requirement is the overriding document. KMI retains a signed copy of T’s & C’s from each supplier.

2.0            Introduction

The “supplier documents” establishes KMI’s quality system requirements for suppliers who manufacture and control respective parts and assemblies as well as suppliers who manufacture products and perform services in-accordance-with KMI customers’ designs and requirements. These basic quality requirements apply to Manufacturers, Producers, Distributors, and Special Processors providing parts/services for KMI when these documents is specified by inclusion on Purchase Order or contract issued by KMI.

3.0            KMI Supplier Approval

KMI utilizes Supplier On-Site Evaluations and/or Quality Surveys to evaluate suppliers’ documented quality systems. Surveys may be completed by the supplier and submitted via email or may be utilized in conjunction with an on-site assessment performed by a KMI representative, at the discretion of KMI INC. KMI approval of this evaluation and/or survey is required for all Manufacturers, Distributors and Special Processors.

Suppliers’ quality systems will comply with the Quality System Requirements for Manufacturers, Distributors or Special Processors as applicable and the supplemental quality requirements outlined in KMI’s “supplier documents”. All written and oral communications with the supplier as well as the supplier’s specifications, procedures, and reports shall be in English. This document flows down KMI’s quality system requirements and defines additional inspection requirements. In addition, it advises suppliers that their quality system, facilities, and those of any sub-tier supplier are subject to site evaluation/audits by KMI.

4.0            KMI Supplier Re-approval

Re-approval will be subject to Supply Chain Quality analysis regarding the supplier’s quality performance history and/or any significant changes in the suppliers quality system. Changes in the suppliers management, ownership, location/address, and/or quality system may require re-approval. It is the responsibility of the supplier to provide to KMI a written statement of any of these changes. This notification shall be sent to the KMI Supply Chain Quality department. Upon receipt of this written notification, KMI will determine what type of re-approval activities, if any, are required.

5.0            Supplier Performance Monitoring

KMI evaluates supplier performance in the areas of Quality and Delivery in-accordance-with KMI’s performance criteria. Notifications are sent to underperforming suppliers.

Quality – KMI monitors the number of parts acceptable compared to rejections for each sub-tier supplier. A cumulative percentage of 98% [total quantity accepted divided by the total number of parts processed] will be the objective for quality performance.

Delivery – On-time delivery is tracked. A rating of 95% is the objective for delivery performance.

KMI will maintain a listing of sub-tier suppliers with the acceptance date and their status shown as “approved”, “conditional”, “probationary”, or “disapproved”. Purchasing will notify the sub-tier supplier when a quarterly performance acceptance rating falls below an acceptable level. Purchasing may disapprove the vendor or withhold further contracts pending documented corrective action and follow-up or until the performance level expectations have been achieved.

Proper completion and submittal of a Supplier Corrective Action Requests (SCAR’s) is required when a suppliers quality performance falls below the acceptable level during any continuous nine-month period.


6.0            Quality System Requirements

6.1            Raw Material and Hardware:

All materials shall be in accordance with end user specifications and produced to final dimensions. Materials in this category shall be supplied from producers shown on the end user Qualified Products Listing. Mill test reports are required for each item and must be traceable.


6.2            Manufacturers:

Suppliers who will be purchasing raw material and processing services will be responsible for ensuring that KMI’s customer approves all sources. A list of approvals for each customer is located at www.kmiusa.com/rawsuppliers/ If the information needed is not available, contact KMI supply chain management for additional information.

Suppliers will be responsible for following KMI”s customer engineering, drawing, specifications requirements and special PO requirements. Additional engineering may be requested through KMI”s supply chain management.

6.2      Special Processors:

Special process suppliers are required to achieve NADCAP accreditation in order to maintain approval status. It is the supplier’s responsibility to submit current NADCAP accreditation certificates to supply chain quality and to ensure that supply chain quality is notified regarding any change of certification status. Questions regarding special process approval should be directed to supply chain quality. All special process deviations must be first approved by KMI’s supply chain management.