n TFM Magazine - Supplier development - procuring in the grey zone - supplier development

Volume 2 Number 14
  • ISSN : 2308-0639
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What is the key factor in which procurement decisions are made?

Essentially, organisations are looking for suppliers that are effective in delivering an array of services or products in a specific commodity or sub-commodity, with one point of contact. Mostly, the procurement approach in South Africa is arranging purchases neatly into distinct ‘silos’- otherwise known as categories - that effectively creates dominance in an organisation’s supply chain. As a result, dominant suppliers align their business structure to the procurement needs of their clients. Put another way, to grow their existing business in their specific market, they invest in vertical integration, which makes perfect business sense.

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