vendor means supplying the material to company...
any one company looking raw material.. these raw material 
supplies are called vendor. tcode mko1.

Suppose Company 'A' manufactures 'GEARS'.So the company 'A' 
needs number of other raw material and other parts for 
final assembly of the GEAR.
The company 'A' will purchase these raw materials and other 
parts from company 'B'. 
The company 'B' is known a Vendor for company 'A'.

The Company 'A' will take the order of the manufacturing of 
GERAS form Comapny 'C'.Comapny 'C' is in the manufacturing 
of 2-Wheelers.
The company 'C' is the Client for company 'A'