Supply base optimization means ______.

Question

Quizplus · Accepted Answer

Supply base optimization refers to determining the optimal number of suppliers to purchase from to ensure a balance between supply chain risk and cost. It involves selecting suppliers based on factors such as performance, quality, capacity, reliability and competitiveness. Reducing the number of suppliers may lead to increased control and communication, but it may also limit the ability to access alternative sources of supply, while engaging a large number of suppliers may result in high transaction costs and complexity. Leaving the organization to be vulnerable to unexpected price increases is not an acceptable approach.

Supply Base Optimization Means ______