Single Sourcing

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Description of Single Sourcing. Explanation.




Definition Single Sourcing. Description.

Single Sourcing is the traditional Japanese purchasing policy of using only one supplier to purchase certain components, products, product groups or services.

Key advantages of Single Sourcing when compared to Multiple Sourcing are:

  • May result in high level of co-operation with the supplier (Strategic Alliance).

  • Lower pricing due to consolidation of all requirements with one supplier.

  • May result in higher or more consistent quality.

  • Enabler for Just-in-time.

  • Frees up time to focus on buying other products or services.

  • Supplier may provide a range of value added services.

  • Lower administration, communication and negotiation efforts and costs.

  • Easier to track down the source of problems as well as affected products in the event of a quality issue or product recall.

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Compare with: Kraljic Model  |  Just-in-time  |  Co-Creation  |  Outsourcing  |  3rd Party Logistics (3PL)  |  Vendor Managed Inventory  |  Value Chain  |  Vertical Integration  |   Value Stream Mapping  |  Five Forces model

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