Strategic Sourcing

Strategic Sourcing is a sourcing method that involves applying different strategies while sourcing products or services. Strategies are selected based on real-time circumstances of each acquisition and influenced by factors such as the value of spend, risk in the category, and the supply market character. Crowd sourcing, outsourcing, global sourcing, and low cost country sourcing are a few of the many types of sourcing strategies.

Sourcing Process

The sourcing process includes every activity that revolves around identifying and assessing potential suppliers as well as selecting and engaging with an appropriate supplier who offers the best value. At the end of the sourcing process, usually a contract is signed or an agreement is reached between the buyer and the supplier on what is to be procured and the terms of contract. Sourcing professionals evaluate the supply market, develop and execute strategy, negotiate terms of contract, and finally, develop the contractual agreement with the suppliers.