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How To Develop A Procurement Category Strategy?

How To Develop A Procurement Category Strategy?

Are you tired of procurement processes that seem haphazard and unorganized? Do you want to take your procurement game to the next level, but don’t know where to start? Developing a procurement category strategy might be just what you need. A well-developed strategy can help streamline your purchasing, improve supplier relationships, and ultimately save your company time and money. In this blog post, we’ll walk you through the steps needed to develop an effective procurement category strategy from scratch. So grab a cup of coffee and let’s get started!

What is a Category Strategy?

Category strategy is a process that helps companies identify, categorize, and target their procurement needs. By doing so, companies can better focus their purchasing efforts and make more informed decisions about what products and services to buy.

A category strategy can be broken down into five key steps:

1. Define the company’s business goals.
2. Determine which procurement categories are most important to achieving these goals.
3. Establish specific product or service requirements for each category.
4. Select suppliers in each category that best meet these requirements.
5. Monitor supplier performance and make necessary changes to the category strategy as needed

Why develop a Category Strategy?

When you are developing a procurement category strategy, you need to consider the following:
1) What are your products and services?
2) What are the key customer segments?
3) What is your competitive landscape?
4) What are your company’s unique selling points?
5) What is your target market?
6) What are the best practices for procurement within your industry?
7) How do you measure success with this strategy?
8 ) Who will be responsible for implementing this strategy within your organization?

The Components of a Category Strategy

A category strategy is a business-wide plan that identifies, evaluates, and selects the best procurement methods for a company. It helps companies to purchase goods and services from the most appropriate sources while saving money.

There are four essential components of a category strategy:
1. Identification of market segments: This step includes understanding customers’ needs and wants, as well as competitor strategies.
2. Evaluation of procurement methods: The next step is to evaluate which procurement methods are best suited for each segment and market.
3. Selection of appropriate procurement methods: After evaluating the different procurement methods, it’s important to select the ones that will provide the greatest benefit for your company.
4. Implementation of a category strategy: Once selected, implementing a category strategy requires a dedicated team effort with regular communication among all involved parties.

How to develop a Category Strategy

Category strategy is the process of developing a comprehensive plan for categorizing products and services, and then organizing and managing those categories in an effort to improve purchasing decisions. The goal of category management is to reduce the time and cost necessary to find, evaluate, and purchase the right product or service.

There are three steps in creating a category strategy:

1) Define your target market. What are your ideal buyers looking for? What types of products or services do they need?
2) Analysis: Once you know your target market, what are their buying needs? How do they shop for products or services?
3) Creation: Create subcategories and organize them according to how buyers would best use them. Define where each product or service falls within that category.

When to Implement a Category Strategy

Category strategy is a way to organize and manage procurement efforts by grouping products, services, or technologies into categories and setting specific purchasing requirements for each. When done correctly, category strategy can help streamline procurement by simplifying the buying process while maintaining vendor quality and competitiveness. However, implementing a category strategy is not straightforward. Here are five tips on how to develop a successful category strategy:

1. Define Your Categories: The first step in developing a category strategy is clarifying what you want to purchase. Once you have defined your categories, you need to assess what products or services fit within each category and determine which ones are most relevant to your organization.
2. Assess Vendor Quality: Next, you need to evaluate vendor quality in relation to each of your categories. This will help you identify the best suppliers for each type of product or service.
3. Establish Clear Requirements: Finally, establish clear requirements for products and services that fall within your selected categories. This will help ensure that vendors meet your expectations and maintain competitiveness in the market place.
4. Prioritize Purchasing Needs: Once you have determined which products and services fit within each of your categories, it’s time to prioritize your purchasing needs. This will help you focus your spending on the items that are most important to your organization…


Developing a procurement category strategy is an important step in ensuring that your business can purchase the products and services it needs in a cost-effective way. By understanding the different types of procurement categories and how they work, you can create an overall strategy for sourcing products and services. This will help your business save money while still providing the quality it expects. Thanks for reading!

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