What is negotiation cycle in SAP LOD-SBO - Supply Base Optimization?

SAP Term: negotiation cycle

• Component: LOD-SBO

• Component Name: Supply Base Optimization

• Description: The period during which a buyer and a supplier communicate to negotiate the best price for a component. It can be quarterly, monthly, semiannual, annual, or an ad hoc cycle.

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• Key Concepts: 
  The negotiation cycle in SAP LOD-SBO Supply Base Optimization is a process that helps companies to optimize their supply base. It involves the negotiation of contracts with suppliers, the evaluation of supplier performance, and the optimization of the supply base. The negotiation cycle helps companies to identify and select the best suppliers for their needs, and to ensure that they are getting the best value for their money. 
  
  How to use it: 
  The negotiation cycle in SAP LOD-SBO Supply Base Optimization is used to identify and select the best suppliers for a company's needs. It involves the negotiation of contracts with suppliers, the evaluation of supplier performance, and the optimization of the supply base. The process begins with an analysis of the company's current supply base, followed by a review of potential suppliers. The company then evaluates each potential supplier based on criteria such as price, quality, delivery times, and other factors. Once a supplier is selected, a contract is negotiated and signed. 
  
  Tips & Tricks: 
  When negotiating contracts with suppliers, it is important to ensure that all terms are clearly defined and agreed upon. It is also important to ensure that all parties understand the terms of the contract and that any changes are documented in writing. Additionally, it is important to review supplier performance regularly to ensure that they are meeting their obligations. 
  
  Related Information: 
  SAP LOD-SBO Supply Base Optimization also includes features such as supplier segmentation, supplier scorecards, and supplier performance management. These features help companies to better manage their supply base and ensure that they are getting the best value for their money. Additionally, SAP provides a range of tools and resources to help companies optimize their supply base.