Backward Integration in Procurement Positioning Matrix

Kraljic Model
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Inoka Liyanage
Sri Lanka

Backward Integration in Procurement Positioning Matrix

What is the most appropriate quadrant in the procurement positioning matrix to which a backward integration strategy is best suited? Please motivate your point of view.



Backward Integration in Kraljic Matrix

Backward integration is happening when a firm aims to increase its control of its inputs or supplies. It is therefore typically a risk-reduction strategy. So in my opinion it typically involves Bottleneck or Strategic Items in the procurement positioning matrix of Kraljic.


Backward Integration in Kraljic

@Anonymous: I agree, it woudn't make sense in the other quadrants as the supply risk is relatively small.
So bottleneck or strategic.

Bakkabulindi Andrew
Consultant, Uganda

Backward Integration and Purchasing

Actually to add on to that, Backward integration happens when a firm takes possession of what may be required for an operation to take its course, preventing having to hunt for such required materials at suppliers which is more risky.
Therefore, taking control over such materials minimizes the would-be risks.


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