The Procurement Glossary » Strategic Supplier
Strategic Supplier
Suppliers & Vendors
Definition
A supplier critical to the business — by spend, risk or capability — that warrants a close, managed relationship.
Explanation
Strategic suppliers are few but vital: losing one would hurt. They receive SRM attention — joint planning, performance reviews, innovation work — because the relationship's health directly affects the buyer's success.
Example
The sole maker of a patented component is a strategic supplier, managed with quarterly executive reviews.
Related terms
- Supplier Relationship Management (SRM) — A strategic approach to managing key supplier relationships to unlock mutual value beyond price.
- Supplier Segmentation — Grouping suppliers by importance and risk so management effort is focused where it delivers most value.
- Single Sourcing — Choosing to buy an item from one supplier even though alternatives exist, usually to gain volume leverage or a deeper partnership.
- Supply Risk — The risk that supply of a good or service is disrupted, constrained or made more costly.
Frequently Asked Questions
What is Strategic Supplier?
A supplier critical to the business — by spend, risk or capability — that warrants a close, managed relationship. Strategic suppliers are few but vital: losing one would hurt. They receive SRM attention — joint planning, performance reviews, innovation work — because the relationship's health directly affects the buyer's success.
Can you give an example of Strategic Supplier?
The sole maker of a patented component is a strategic supplier, managed with quarterly executive reviews.
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