Posted by Roxanne Ofamen
Oct 27, 2026
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Vendor due diligence
The process of assessing your shortlisted service providers before doing business with them, including the potential risks and risk mitigation strategies associated with the engagement.
- From Outsource with Caution: An Outsourcing Due Diligence Handbook
3 reasons why vendor due diligence matters
1. Prevents data breaches
Auditing vendor cybersecurity protocols can give you the assurance that they meet your data safety standards and won’t leak sensitive customer information.
2. Ensures legal compliance
Reviewing a vendor’s compliance with relevant industry regulations can keep you safe from potential fines and lawsuits.
What documents should you check?
✓ Licenses and permits
✓ Tax documents
✓ Audited financial statements
✓ Organizational chart
✓ Quality control certifications
✓ Company policies
✓ IT and data security policies
✓ Insurance policies
✓ Operational information
✓ Physical security details
✓ Published news
3. Ensures legal compliance
Checking past marketing materials and client references validates that the vendor can deliver the performance levels promised in their sales pitch.
If you need a thorough guide to conducting the due diligence process, download a copy of our e-book, Outsource with Caution: An Outsourcing Due Diligence Handbook.
Inside this e-book:
- Fundamentals of the outsourcing due diligence process
- List of legal documents you need to assess
- Basic format of a due diligence process.
- FREE DOWNLOAD: Outsourcing Due Diligence Checklist + Due Diligence Form and Reporting Templates
Want to learn more about our services? Get in touch with us at marketing@dvphilippines.com.
