Depends on the context.
One definition is that the Preferred Supplier is designated as such until negotiations with them are complete. They become "preferred" after a competitive bidding process and are selected as the preferred supplier against the other potential suppliers. When negotiations are complete and the contract is signed, they then become an Approved Supplier.
The company that comes "second" in the bidding process can sometimes become the Reserve Supplier in case negotiations fail with the preferred bidder.
There may be other perspectives.
Hope this helps.
ShaunCScott