This decision could be based on price or the quality of products. In simple terms, it is the decision to select one certain supplier, although there are others who offer the same or very similar product. Unfortunately, this is the only person to make a deal with so you may have to pay a higher price or ease up on some order restrictions to keep them interested. There is no bidding or squeezing you into a time slot between other orders. A single source example would be if you are manufacturing golf balls and are looking for someone to supply the plastic outer shell. In many cases, you would choose a single source provider based largely on the price offered by a specific vendor. In purchasing sole sourcing take place when only one supplier for the required item is available, whereas with single sourcing a particular supplier is purposefully chosen by the buying organisation, even when other suppliers are available (Larson and Kulchitsky, 1998; Van Weele, 2010). Sole Sourcing. However, you can bypass the process of evaluating competitive bids and choose a specific vendor. Different suppliers and distributors typically produce and sell similar merchandise. Often these products are extremely unique or made with a scarce resource/ material making these suppliers the only option. Whereas single source procurement requires research and comparisons between suppliers. Here are some places to begin: What is a Manufacturing Execution System (MES)? Sole source: can be called as a agent/agency for the required products, which others do not have, or does not deal in. How to Implement an Effective Strategic Sourcing Initiative. There are other factors that go int… SINGLE SOURCE PURCHASE JUSTIFICATION. Choosing a specific company and bypassing the competition refers to single sourcing. What is difference between "sole source" and "single source"? In that situation, you bypass competitive bidding, because you’re certain that no other vendor can match or beat the price of the vendor you’ve chosen. A sole source example would be the computer company Dell, it’s accessories specifically. After exhaustive search and sourcing, only one Company is ready to supply. Reference price lists, but still get a quote as they often tend to be less than advertised. This case may not be due to time constraints but may also happen due to the equipment spare parts (for example) needed are almost phased out in the market or particular specilaty service is very hard to find. Due to this nature, you can either try using something else to complete your production or change the requirements for your final product. How will you negotiate with a single source supplier? Proprietary Products: Single Source and Sole Source Procurement. is one in which the supply of product or service is only available from one Company because it is the only one that can supply the needed product or service in a particular time when that product or service is needed. The decision to go with a single source is often based on the price they offer and sometimes based upon a superior product to all other suppliers. If we write an RFQ for a product that is provided by only a sole/single source, how we can get their good response in terms of price, delivery, etc.? When you’re evaluating the merits of a contract with a supplier, you typically have a choice among different companies that can provide you with the products you need. Elucidate the merits and demerits of single source and dual source suppliers for the global niche market? You can also save on administrative costs with a sole source vendor, because you spend less time haggling about things such as price and delivery schedule. Do you agree or not. Departments must state the circumstances leading to the selection of the vendor, any alternatives considered, rationale for … There is simply a negotiation between you and the supplier to discuss what is a fair price and decide any other parameter of the deal. A sole source is defined as the only supplier that can provide you with the goods or products you need. Comparison shopping can reduce costs and help educate owners about their various options. It also allows you to negotiate more favorable terms, and to change vendors if one doesn’t meet your expectations. You could also choose a single source provider based on the quality of goods it offers, which you determine is superior to all others. Single source: is the source who has particular items available in stock and others do not have it or has only quoted for the required items and others did not. However, before you make a decision about a distributor or supplier, it’s important to understand the difference between a single source provider and a sole source.