What is single sourcing in SAP MM-PUR - Purchasing?

SAP Term: single sourcing

• Component: MM-PUR

• Component Name: Purchasing

• Description: The procurement of a material from just one vendor due to a technological advantage this vendor has over vendors, for example.

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• Key Concepts: 
  Single sourcing is a purchasing strategy in which a company only uses one supplier for a particular product or service. This strategy is used to reduce costs, simplify the procurement process, and ensure a consistent quality of goods or services. In SAP MM-PUR Purchasing, single sourcing is used to streamline the purchasing process and ensure that all goods and services are purchased from the same supplier. 
  
  How to use it: 
  In SAP MM-PUR Purchasing, single sourcing is used to streamline the purchasing process. To use single sourcing, a company must first identify the supplier that will provide the goods or services needed. Once the supplier has been identified, all purchases must be made from that supplier. This ensures that all goods and services are of consistent quality and that the procurement process is simplified. 
  
  Tips & Tricks: 
  When using single sourcing, it is important to ensure that the chosen supplier is reliable and able to meet the company’s needs. It is also important to regularly review the performance of the supplier to ensure that they are meeting expectations. Additionally, it is important to have a backup plan in case the chosen supplier fails to meet expectations or becomes unavailable. 
  
  Related Information: 
  Single sourcing is often used in conjunction with other purchasing strategies such as strategic sourcing and total cost of ownership (TCO). Strategic sourcing involves analyzing multiple suppliers in order to identify the most cost-effective option for a particular product or service. TCO takes into account all costs associated with a purchase, including transportation, storage, and other related costs.