What is fixed source of supply in SAP SRD-SRM-SC - SRM-Sourcing and Contracting?

SAP Term: fixed source of supply

• Component: SRD-SRM-SC

• Component Name: SRM-Sourcing and Contracting

• Description: An option, for example a contract, for the procurement of products which the buyer defines as the specific source of supply from which to procure the required product.

Smart SAP Assistant

• Key Concepts: 
  Fixed source of supply is a feature in SAP SRM-Sourcing and Contracting that allows a company to assign a specific supplier to a particular material or service. This ensures that the company will always purchase the material or service from the same supplier, regardless of any changes in the market. 
  
  How to use it: 
  To assign a fixed source of supply, the company must first create a contract with the supplier. Once the contract is created, the company can assign it to the material or service in question. This will ensure that all future purchases of this material or service will be made from this supplier. 
  
  Tips & Tricks: 
  When assigning a fixed source of supply, it is important to consider the cost and quality of the material or service being purchased. It is also important to consider any potential risks associated with relying on one supplier for all purchases. 
  
  Related Information: 
  Fixed source of supply is similar to a blanket purchase order, which allows a company to purchase multiple items from one supplier at predetermined prices. It is also related to vendor managed inventory, which allows suppliers to manage their own inventory levels and order more materials when needed.