Single Sourcing: Short‐Term Savings Versus Long‐Term Problems

Single sourcing, the purposeful process of selecting and using one source of supply, has gained widespread acceptance in U.S industry. The practice is based on a cooperative relationship between the buyer and the seller. Underlying this relationship may be a series of concerns that can generate problems in the long run. The continued emphasis on cost reductions in the short run may be laying the groundwork for stifled innovation and source dependency in the long run. Purchasing must take a proactive role in reducing the risks associated with the current practice of single sourcing.