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With growing competition in the market and dire need for sustainability, it has become imperative for companies to build long‐term relationship with their supply chain partners through sustainable collaboration. Among these, the supplier–manufacturer relationship is crucial for improved organizational, business and sustainable performance. Sustainable collaboration with suppliers involves crucial decision‐making processes such as continuous supplier monitoring and supplier development. Hence, a critical challenge that a company faces is to identify the key performance indicators (KPIs) for assessing the performance of a supplier for sustainable collaboration. In this regard, this study focuses on identification of KPIs for an Indian home appliance company through exhaustive discussions involving multiple decision‐makers. Further, a grey‐based decision‐making trial and evaluation laboratory (DEMATEL) model …