Second sourcing
A)occurs when business firms leave a market.
B)occurs because many big businesses have policies that provide for set-asides for purchases from small businesses.
C)offers the advantage of being globally based.
D)at its best provides a competitive pressure to keep both suppliers providing the best service and prices.

Question

Quizplus · Accepted Answer

Second sourcing refers to the practice of a company having a backup supplier as a safety measure in case their primary supplier fails to deliver. This creates a competitive pressure on both suppliers to provide the best service and prices, which benefits the company. It is different from when business firms leave a market (A) or when big businesses have policies for set-asides for purchases from small businesses (B). While second sourcing can be done globally, it is not necessarily an advantage (C).

Second Sourcing