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Supply Chain Glossary

Glossary  >  S  >  Sourcing  



Source: Procurement Glossary
Author: Paul Rogers
Institute: CIPS - UK

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Sourcing describes all those activities within the procurement process concerned with identifying and evaluating potential suppliers, engaging with selected suppliers and selecting the best value supplier(s).  The outcome of the sourcing process is usually a contract or arrangement that defines what is to be procured, on what terms and from which suppliers.  The phrase ‘strategic sourcing’ may be used to describe the application of the sourcing process to significant acquisitions, or the team that manages the sourcing process on behalf of the organisation.

The scope of the sourcing process usually includes the following key activities: understanding the need; evaluating the supply market; developing an appropriate strategy; executing that strategy, usually involving market interactions such as the issue of an RFP and/or negotiation; selecting supplier(s); and developing a contractual agreement.  See also Sourcing Strategy.




















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