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Category1 Category2 Category3

QUESTIONS #
1 2 3
What is the spend of category 1 Very Low Very Low Very Low
What is the impact of category
on the total purchasing 2 Very Low Very Low High
budget?
What is the impact of the
category item quality on the 3 Very Little Enough High
final product quality?
STRATEGIC IMPORTANCE

Should the category be it should be it should not be it should be


standardized and what is its 4 standardized and it standardized and it standardized and it
current state? is not standardized is not standardized is not standardized

Is there select/preferred
5 No No Yes
supplier?

What is the level of


collaboration between the 6 one-order contract long-term contract one-order contract
company and the suppliers?

How relevant is the category in


companys achieving the 7 irrelevant irrelevant leverage
competitive advantage?

What kind of relationship with minimum number of minimum number of


the suppliers of this category 8 suppliers with long- short-term deal suppliers with long-
is preferable? term contracts term contracts

TOTAL STRATEGIC IMPORTANCE 12 42 45

How easily is the category's available, but only available only from
1 available at any time
items available on the market? periodically the current supplier

Are there any difficulties in an improvement in


many difficulties are many difficulties are
supply that can be expected in 2 supply potential is
expected expected
the near or long future? expected

What is the number of


potential suppliers of the 3 few suppliers many suppliers many suppliers
category on the market?

suppliers are open suppliers are open


for new customers for new customers
What is the time to establish
and they simplify the and they simplify the
relationships with new 4 it takes much time
establishment of establishment of
suppliers?
relationships as relationships as
much as possible much as possible

Can we insource the category we can but it is not we can and it is we can and it is
5
items and is it worth it? worth it worth it worth it

Are there any substitutions


6 many few enough
available on the market?
SUPPLY RISK

To what degree is the company


7 limitedly limitedly strongly
dependent on the supplier?

What are the holding costs for


8 very low very low very low
the category items?

Does the category items lose


partially over long partially over long partially over long
its properties during the 9
period of time period of time period of time
storage period?
SUPP
Does the category become
very low speed very low speed very low speed
obsolete with the technological 10
obseloscence obseloscence obseloscence
progress?

What is the cost to switch from


11 low low low
one supplier to another?

How deep are the suppliers deep in many deep in many


12 nothing special
specialized? products products

What is the level of the after


13 highest medium medium
sale service of the supplier?

Is the variability of items the


suppliers provide can supply 14 High low low
high?

What is the bargaining power


15 very low very low very low
of the supplier?

What is the bargaining power


16 very high very high very high
of the company?
TOTAL SUPPLY RISK 39 36 23

100
SUPPLY RISK

50

0
0 50

STRATEGIC IMPORTANCE
0
0 50

STRATEGIC IMPORTANCE

Category1 Category2 Category3 Category4 Category9 Category10 Category11 Category12 Category


Category26 Category27 Category28 Category29 Category30 Category31 Category32 Category33 Category
Category4 Category9 Category10 Category11 Category12

4 5 6 7 8
Very Low Very Low High Very Low Low

Very Low Very Low Very Low Very Low Very Low

Enough Very Little Enough High Very Little

it should be it should be it should be it should be it should not be


standardized and it standardized and it standardized and it standardized and it standardized and it
is not standardized is standardized is not standardized is not standardized is not standardized

No No Yes No No

short-term contract one-order contract one-order contract long-term contract just-in-time

irrelevant relevant irrelevant irrelevant irrelevant

minimum number of minimum number of minimum number of minimum number of minimum number of
suppliers with long- suppliers with long- suppliers with long- suppliers with long- suppliers with long-
term contracts term contracts term contracts term contracts term contracts

23 31 29 35 30

available, but only


available at any time available at any time available at any time available at any time
periodically

an improvement in an improvement in an improvement in an improvement in an improvement in


supply potential is supply potential is supply potential is supply potential is supply potential is
expected expected expected expected expected

many suppliers many suppliers many suppliers many suppliers many suppliers

suppliers are open suppliers are open suppliers are open suppliers are open suppliers are open
for new customers for new customers for new customers for new customers for new customers
and they simplify the and they simplify the and they simplify the and they simplify the and they simplify the
establishment of establishment of establishment of establishment of establishment of
relationships as relationships as relationships as relationships as relationships as
much as possible much as possible much as possible much as possible much as possible

we can and it is we can and it is we can and it is we can and it is we can and it is
worth it worth it worth it worth it worth it

no no no few many

limitedly limitedly totally independent independent

very low very low very low very low very low

partially over long partially over long partially over long partially over long partially over long
period of time period of time period of time period of time period of time
very low speed high speed very low speed very low speed very low speed
obseloscence obsolescence obseloscence obseloscence obseloscence

low low low low low

deep in many deep in many deep in many deep in many


nothing special
products products products products

highest highest no after sale service highest highest

High low High low low

very low very low very high very low very low

very high very low very low very high very high

28 30 46 21 18

100

ORTANCE
100

ORTANCE

gory11 Category12 Category13 Category23 Category24 Category25


gory32 Category33 Category34 Category35 Category36
Category13 Category23 Category24 Category25 Category26

9 10 11 12 13
Very Low Very High Low High Very Low

Very Low Very High Very Low Very Low Very Low

Very Little Enough Very Little Very Little Enough

it should be it should not be it should not be it should be it should be


standardized and it standardized and it standardized and it standardized and it standardized and it
is not standardized is not standardized is not standardized is not standardized is not standardized

No Yes Yes No No

one-order contract one-order contract one-order contract one-order contract one-order contract

commodity
irrelevant relevant irrelevant irrelevant
component

minimum number of minimum number of minimum number of minimum number of


secure short and
suppliers with long- suppliers with long- suppliers with long- suppliers with long-
long term supply
term contracts term contracts term contracts term contracts

12 72 28 21 18

not always available


available, but only
available at any time available at any time also from the current available at any time
periodically
supplier

an improvement in no significant an improvement in an improvement in


many difficulties are
supply potential is change in supply is supply potential is supply potential is
expected
expected expected expected expected

many suppliers many suppliers many suppliers one supplier few suppliers

suppliers are open suppliers are open


for new customers for new customers
it takes some time, it takes some time,
and they simplify the and they simplify the it takes much time
but suppliers are but suppliers are
establishment of establishment of and financial efforts
easy to reach easy to reach
relationships as relationships as
much as possible much as possible

we can and it is we can and it is we can and it is we can not and it is we can but it is not
worth it worth it worth it not worth it worth it

enough many enough no many

strongly independent limitedly independent strongly

very high very low high very low very low

totally over long partially over long partially over short partially over long partially over long
period of time period of time period of time period of time period of time
very low speed high speed low speed very low speed low speed
obseloscence obsolescence obsolescence obseloscence obsolescence

low low low low low

deep in many deep in many deep in many


deep in few products nothing special
products products products

highest highest medium highest limited

low low High low High

very low very low low very low very low

very high high low very high very low

33 28 40 55 39
Category27 Category28 Category29 Category30 Category31

14 15 16 17 18
Very Low Very Low Very Low Very High Very High

Very Low Very Low Very Low Very High Very High

Very Little Very Little Very Little High High

it should not be it should be it should be it should be it should not be


standardized and it standardized and it standardized and it standardized and it standardized and it
is not standardized is standardized is not standardized is standardized is standardized

No Yes No Yes Yes

one-order contract long-term contract one-order contract long-term contract one-order contract

commodity commodity
irrelevant relevant irrelevant
component component

minimum number of minimum number of minimum number of


secure short and
suppliers with long- mutual commitment suppliers with long- suppliers with long-
long term supply
term contracts term contracts term contracts

16 57 12 82 65

available only from available only from


available at any time available at any time available at any time
the current supplier the current supplier

an improvement in no significant an improvement in an improvement in an improvement in


supply potential is change in supply is supply potential is supply potential is supply potential is
expected expected expected expected expected

many suppliers many suppliers many suppliers many suppliers many suppliers

suppliers are open suppliers are open suppliers are open


for new customers for new customers for new customers
it takes some time,
and they simplify the and they simplify the and they simplify the
it takes much time but suppliers are
establishment of establishment of establishment of
easy to reach
relationships as relationships as relationships as
much as possible much as possible much as possible

we can and it is we can and it is we can and it is we can and it is we can and it is
worth it worth it worth it worth it worth it

many many many many enough

independent totally independent independent independent

very low very low very low high very low

totally over long partially over long partially over long partially over long partially over long
period of time period of time period of time period of time period of time
very low speed very high speed very low speed very low speed very low speed
obseloscence obsolescence obseloscence obseloscence obseloscence

High low low low low

deep in many deep in many deep in many deep in many deep in many
products products products products products

highest medium highest highest highest

low low low low low

very low very low very low very low very low

very high very high very high very high very high

24 37 18 30 19
Category32 Category33 Category34 Category35 Category36

19 20 21 22 23
Very Low Very Low Very Low Very Low Very Low

Very Low Very Low Very Low Very Low Very High

High Very Little Little Very Little High

it should not be it should not be it should not be it should be it should not be


standardized and it standardized and it standardized and it standardized and it standardized and it
is standardized is not standardized is not standardized is not standardized is not standardized

Yes Yes No Yes Yes

long-term contract long-term contract one-order contract one-order contract long-term contract

relevant relevant leverage leverage relevant

minimum number of minimum number of


mutual commitment mutual commitment suppliers with long- suppliers with long- mutual commitment
term contracts term contracts

61 55 28 23 85

available at any time available at any time available at any time available at any time available at any time

an improvement in an improvement in an improvement in an improvement in


many difficulties are
supply potential is supply potential is supply potential is supply potential is
expected
expected expected expected expected

many suppliers many suppliers many suppliers many suppliers many suppliers

suppliers are open suppliers are open suppliers are open


for new customers for new customers for new customers
it takes some time,
and they simplify the it takes much time and they simplify the and they simplify the
but suppliers are
establishment of and financial efforts establishment of establishment of
easy to reach
relationships as relationships as relationships as
much as possible much as possible much as possible

we can and it is we can and it is we can and it is we can but it is not we can and it is
worth it worth it worth it worth it worth it

many many many many many

independent independent independent independent independent

very low very low very low very low very low

partially over long partially over long partially over long partially over long partially over long
period of time period of time period of time period of time period of time
very low speed very low speed very low speed very low speed very low speed
obseloscence obseloscence obseloscence obseloscence obseloscence

low low low low low

deep in many deep in many deep in many deep in many deep in many
products products products products products

highest highest highest highest highest

low low low low low

very low very low very low very low very low

very high very high very high very high very high

18 22 23 20 19
# Questions
1 What is the spend of category
2 What is the impact of category on the total purchasing budget?
3 What is the impact of the category item quality on the final product quality?
STRATEGIC IMPORTANCE

4 Should the category be standardized and what is its current state?

5 Is there select/preferred supplier?

6 What is the level of collaboration between the company and the suppliers?

7 How relevant is the category in companys achieving the competitive advan

8 What kind of relationship with the suppliers of this category is preferable?

1 How easily is the category's items available on the market?

Are there any difficulties in supply that can be expected in the near or long
2
future?

3 What is the number of potential suppliers of the category on the market?

4 What is the time to establish relationships with new suppliers?


SUPPLY RISK

5 Can we insource the category items and is it worth it?

6 Are there any substitutions available on the market?


7 To what degree is the company dependent on the supplier?
8 What are the holding costs for the category items?

9 Does the category items lose its properties during the storage period?

10 Does the category become obsolete with the technological progress?

11 What is the cost to switch from one supplier to another?


12 How deep are the suppliers specialized?

13 What is the level of the after sale service of the supplier?


14 Is the variability of items the suppliers provide can supply high?
15 What is the bargaining power of the supplier?
16 What is the bargaining power of the company?
Answers Weights
Very Low Low High Very High 2 6 11
Very Low Low High Very High 3 10 17
Very Little Little Enough High 2 5 8
it should be it should not be
it should not be it should be
standardized standardized and
standardized and standardized and it is 1 3 5
and it is not it is not
it is standardized standardized
standardized standardized
No Yes 1 3 0
One time short-term
just-in-time long-term contract 2 5 10
contract contract
commodity
irrelevant leverage relevant 2 6 11
component
minimum
number of
secure short and
suppliers with short-term deal mutual commitment 1 3 6
long term supply
long-term
contracts
available only not always available
available at any available, but
from the current also from the current 1 3 6
time only periodically
supplier supplier

an improvement
no significant
in supply many difficulties
change in supply 2 4 7
potential is are expected
is expected
expected
many suppliers few suppliers one supplier 2 6 10

suppliers are
open for new
it takes some
customers and
time, but it takes much time and
they simplify the it takes much time 1 2 4
suppliers are financial efforts
establishment of
easy to reach
relationships as
much as possible

we can and it is we can but it is we can not but it we can not and it is not
1 3 8
worth it not worth it is worth it worth it
many enough few no 1 2 4
independent limitedly strongly totally 1 2 4
very low low high very high 1 3 7
partially over partially over
totally over long totally over short
long period of short period of 1 2 3
period of time period of time
time time
very low speed low speed high speed very high speed
1 2 4
obseloscence obsolescence obsolescence obsolescence
low High 1 5
deep in many deep in few
nothing special 1 2 5
products products
highest medium limited no after sale service 1 2 4
low High 1 4
very low low high very high 1 2 4
very high high low very low 1 2 4
Weights
15
25
10

15

15

10

10

5
5
10

5
5

6
5
Category # Category Name
Construction
1 Category1
2 Category2
3 Category3
4 Category4
Electrical
1 Category5
2 Category6
3 Category7
4 Category8
5 Category9
6 Category10
7 Category11
8 Category12
9 Category13
Equipment
1 Category14
2 Category15
3 Category16
4 Category17
5 Category18
6 Category19
7 Category20
8 Category21
9 Category22
10 Category23
11 Category24
12 Category25
13 Category26
14 Category27
15 Category28
16 Category29
17 Category30
18 Category31
19 Category32
20 Category33
21 Category34
22 Category35
23 Category36