Comparing Sole Sourcing and Single Sourcing: A Comprehensive Guide

Sole Source Vs Single Source What is Sole Sourcing? Sole sourcing is a procurement strategy where an organization purchases goods or services exclusively from a single supplier. This approach is typically used when: • The supplier has unique capabilities, proprietary technology, or specialized expertise. • No other vendors can provide the required product or service. Key Characteristics of Sole Sourcing • Exclusivity o There is only one supplier capable of fulfilling the organization's specific needs. • Specialization o Often used for highly specialized products or patented technologies that other suppliers cannot replicate. • Risk Management o While sole sourcing can streamline procurement, it can also make organizations vulnerable to supply chain disruptions if the sole supplier faces financial or production issues. • Cost Implications o The lack of competition can lead to higher prices, as the supplier does not have pressure to offer competitive rates.