{"id":2923,"date":"2010-07-20T19:21:00","date_gmt":"2010-07-20T19:21:00","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2010\/07\/20\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/"},"modified":"2023-06-20T04:23:45","modified_gmt":"2023-06-20T08:23:45","slug":"supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/","title":{"rendered":"Supply Base Overconsolidation: Is It For The Laziest Procurement Professionals?"},"content":{"rendered":"

Whether you\u2019re the average consumer or a procurement executive for a Fortune 500 company, there is a probability that you might be lured in by the attractiveness of the \u201cone-stop-shop\u201d \u2013 a store or supplier where you can buy multiple categories of goods. The question is: how much supplier consolidation is too much?<\/p>\n

Don\u2019t miss updates on Procurement & Supply Chain, Subscribe here!<\/p>\n

It is not uncommon to hear of procurement professionals asking for one supplier to provide \u201cit all.\u201d Some even go so far as to suggest that if the prospective supplier doesn\u2019t supply a product or service that they outsource it and serve as the point of contact.<\/p>\n

It certainly is true that supplier consolidation has its advantages. Fewer people to deal with and the leverage to drive down prices are two of the biggies.<\/p>\n

But there are disadvantages that too few procurement professionals consider.<\/p>\n

Let\u2019s consider an outsourcing relationship. Just because one outsourced service provider has an adequate call center to handle customer service calls does not mean that their IT outsourcing services will be adequate. In fact, because of the vast difference in skill sets required, their IT outsourcing services may be quite horrendous.<\/p>\n

But they may still get selected based on the desire to consolidate the supply base. The goal of supplier reduction trumps quality. But should it? Is the company really becoming more profitable by having one fewer supplier?<\/p>\n

Jump to the consumer side. Walmart sells a large number of goods categories. Furniture is one of them. But you can\u2019t tell me that a formal dining room set from Walmart can match the quality of a formal dining room set from a fine furniture store.<\/p>\n

So is it worth the sacrifice for the convenience of buying your dining room set from the same place as you buy your milk and socks?<\/p>\n

A consumer who is quality conscious would say \u201cno.\u201d Yet, procurement professionals make parallel choices every single day.<\/p>\n

And what about requiring a supplier to outsource the portion of the offering that they don\u2019t provide in house? Why is it worth sacrificing control over one\u2019s organization\u2019s own destiny for the sake of dealing with one fewer supplier? Just because a supplier will manage that other relationship doesn\u2019t mean that they will manage it well.<\/p>\n

Yet, in many cases, convenience matters more. The cost reduction of using that one fewer supplier is hard to prove. If a cost reduction is hard to prove, guess what\u2026it may not be real!<\/p>\n

Lazy procurement?<\/p>\n

Not always.<\/p>\n

But, in some cases, absolutely.<\/p>\n

Recommended Reading<\/strong><\/p>\n

Coming Tomorrow: New Purchasing Thought Leaders Take The Reigns For Whitepaper Wednesday<\/a><\/p>\n

You\u2019ll Always Think You Do A Great Job (Until You Benchmark)<\/a><\/p>\n

When The Going Gets Tough, The Weak Blame Their Suppliers<\/a><\/p>\n

Whitepaper Wednesday \u2013 Supplier Insurance Requirements<\/a><\/p>\n

US Government B*tch Slaps HP, Sends Tough Procurement Message<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Whether you\u2019re the average consumer or a procurement executive for […]<\/p>\n","protected":false},"author":12,"featured_media":3996,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2923","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-procurement"],"yoast_head":"\nSupply Base Overconsolidation: Is It For The Laziest Procurement Professionals? - Next Level Purchasing Association (NLPA)<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Supply Base Overconsolidation: Is It For The Laziest Procurement Professionals? - Next Level Purchasing Association (NLPA)\" \/>\n<meta property=\"og:description\" content=\"Whether you\u2019re the average consumer or a procurement executive for […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/\" \/>\n<meta property=\"og:site_name\" content=\"Next Level Purchasing Association (NLPA)\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/NextLevelPurchasing\/\" \/>\n<meta property=\"article:published_time\" content=\"2010-07-20T19:21:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-06-20T08:23:45+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/11\/nlpa-images-006.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1067\" \/>\n\t<meta property=\"og:image:height\" content=\"1600\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Galo Matagay\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@nextlevelpurch\" \/>\n<meta name=\"twitter:site\" content=\"@nextlevelpurch\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Galo Matagay\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/\"},\"author\":{\"name\":\"Galo Matagay\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/72d094fab77892483dfa6e061cb27eaa\"},\"headline\":\"Supply Base Overconsolidation: Is It For The Laziest Procurement Professionals?\",\"datePublished\":\"2010-07-20T19:21:00+00:00\",\"dateModified\":\"2023-06-20T08:23:45+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/\"},\"wordCount\":493,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#organization\"},\"articleSection\":[\"Procurement\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/\",\"url\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/supply-base-overconsolidation-is-it-for-the-laziest-procurement-professionals\/\",\"name\":\"Supply Base Overconsolidation: Is It For The Laziest Procurement Professionals? 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