Sourcing Management Definition

Sourcing management is the process of identifying, evaluating, and selecting suppliers that can provide goods or services to an organization. The goal of sourcing management is to find suppliers that offer the best value in terms of quality, price, delivery, and other factors.

The sourcing process begins with a needs assessment, in which the organization identifies the types of goods or services it needs. Once the organization knows what it needs, it can begin to identify potential suppliers. To find potential suppliers, the organization can use a variety of methods, such as online directories, trade shows, and word-of-mouth.

Once potential suppliers have been identified, the organization will evaluate them to determine which ones are the best fit for its needs. The evaluation process includes assessing the supplier’s ability to meet quality standards, deliver goods or services on time, and offer competitive prices. The organization will also consider other factors such as the supplier’s reputation and financial stability.

After the evaluation process is complete, the organization will choose one or more suppliers to work with. The selection of a supplier is based on a number of factors, including price, quality, delivery time, and other considerations. Once a supplier has been selected, the organization will enter into a contract with them. This contract will outline the terms of their agreement, such as price, delivery schedule, and any other special conditions.