Criteria for Supplier Categorization

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Makena Maureen
Kenya

Criteria for Supplier Categorization

I need criteria to categorize my suppliers so as to give the most priority to the most strategic suppliers. In what way can I categorize these vendors?

  Koen Vandermarliere
Business Consultant, Belgium
 

Criteria to Categorize your Strategic Vendors

Hi Maureen, thanks for your question,
I'm sure that you can do that by using Kraljic. You need to assess 2 things with regards to the vendors or the products (depending if you are doing this exercise on supplier level or on commodity level):
- 1 is the importance of the business you do with each vendor, and
- the importance of supply risk involved working with each supplier.
The suppliers with the highest risk and highest profit impact are strategic suppliers, high risk and low value are leverage suppliers that you should try to evolve to strategic.
Does this help? To get more in depth please provide more info on your business, etc.

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