What is market segmentation in SAP SRD-SRM - SRM-Supplier Relationship Management?

SAP Term: market segmentation

• Component: SRD-SRM

• Component Name: SRM-Supplier Relationship Management

• Description: A method of showing the degree of business impact and market complexity of the product category based on factors such as product availability and buyer’s amount of leverage during price negotiations. Using market segmentation, a buyer can assign a product category to one of the following: Bottleneck: low costs - high supply risk Non-Critical: high costs - low supply risk Routine: low costs - low supply risk Strategic: high costs - high supply risk

Smart SAP Assistant

• Key Concepts: 
  Market segmentation is the process of dividing a market into distinct groups of buyers who have similar needs, wants, and behaviors. In SAP SRM-Supplier Relationship Management (SRD-SRM), market segmentation is used to identify and target potential suppliers based on their capabilities and performance. 
  
  How to use it: 
  In SRD-SRM, market segmentation can be used to identify potential suppliers that meet specific criteria. This can include criteria such as geographic location, product or service offerings, pricing, and delivery times. Once potential suppliers are identified, they can be evaluated based on their capabilities and performance. 
  
  Tips & Tricks: 
  When using market segmentation in SRD-SRM, it is important to consider the specific needs of the organization. This will help ensure that the right suppliers are identified and evaluated for the organization’s specific requirements. 
  
  Related Information: 
  Market segmentation is a key component of supplier relationship management (SRM). It is also closely related to supplier selection and evaluation processes. Understanding how to effectively use market segmentation in SRD-SRM can help organizations identify and select the best suppliers for their needs.