Strategic sourcing is a structured approach to selecting supply markets and suppliers based on total value, risk, demand, and long-term business needs. It goes beyond obtaining the lowest immediate price by considering quality, capacity, resilience, service, and the full cost of ownership.
How does Strategic sourcing work in practice?
Strategic sourcing begins with demand, spend and market analysis rather than an immediate request for price. The team develops a category or event strategy, confirms requirements, evaluates suppliers and negotiates the full commercial arrangement. Award and implementation connect the selected supplier to contracts, ordering and performance management so the sourcing decision produces an operational result.
Quick reference for Strategic sourcing
Quick reference for Strategic sourcingCheckWhat it means for the transactionCategoryProcurement and sourcingRecord to keepKeep the requirement, requester, supplier response, evaluator and approval together when they apply.Do not inferDo not treat a sourcing record as a purchase order, invoice or proof of delivery unless that later document has actually been issued.
Related Terms
