The Kraljic Matrix helps us develop a purchasing strategy for the products and services our organization consumes. It aims to remove supply vulnerability as. Kraljic Matrix, also known as Purchasing Portfolio Matrix or Supply Chain Portfolio Matrix, is a method developed by Peter Kraljic in It is used to create a. The Purchasing Portfolio Matrix [Kraljic ] Rys. 2. Key words: Purchasing, Kraljic-matrix, purchasing strategies, new concepts based on.

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Newer Post Older Post Home. There is a balance of power between the company and the supplier. Such an attitude is not only obsolete but also costly Kraljic.

These are products that are essential for the production process but they are difficult to obtain. Precondition is that each product or product group can be placed into the matrix.

A supplier should not have the upper hand nor have power over an organization.

Harvard business review, 61 5 Did you find this article interesting? His 2×2 matrix is set out to provide companies with a way to distinguish between different types of purchasing strategies which maximise buying power while minimising supply risks.

Save my name, email, and website in this browser for the next time I comment. The Kraljic Matrix allows matfix to work in a smarter way with those suppliers we already have.

Kraljic Matrix

matrxi Activity Log December 29, Because of their large financial impact, these items are important to the organization. What do you think? These are items that have a low financial impact on our organization, however, there is a high supply risk.

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These types of products are purchased from one supplier. The Kraljic matrix helps us in the first step of supplier management — identifying important suppliers.

With strategic suppliers, thinking about how we are perceived to them is important, and based on our answer to this question, we may want to approach how we build a relationship with that supplier in a different manner. This katrix makes use of cookies to enhance browsing experience and provide additional functionality. Your rating is more than welcome or share this article via Social media! No company can allow purchasing to lag behind other departments in acknowledging and adjusting to worldwide environmental and economic changes.

What are the logistics costs and are there monopoly or oligopoly conditions? This quadrant normally krajic high-value items such as precious metals with limited, or even a single supplier. Strategic Items These items have a large financial impact on our organization. What is the strategic importance of the purchase of certain materials? A minor change in price or a change in quality will strongly affect the cost price. This is defined from low to high. If you truly want to develop a comprehensive supplier management strategy, then this is the area you should focus on first.

The Kraljic Matrix | How to Optimize Purchasing Costs and Risks

Always up-to-date with our latest practical posts and updates? This will be a function of our past dealings with the supplier and their size. It aims to remove supply vulnerability as much as possible and maximize our potential buying power.


It does this by helping us determine, on a per product or per supplier basis, the type of relationship we should be fostering with each of our suppliers. These items have a large financial impact on our organization. After reading you will understand the basics of this powerful purchasing strategy tool.

To what extent are the materials up-to-date and have the latest technology and materials substitutions been used? Secondly, we need to develop plans to reduce our dependence on this supplier, by adapting our products mtrix investigating alternative products and suppliers.

Add a link to this page on your website: What are your success factors for the good purchase strategy? Just like strategic items, these items have a large financial impact on our organization, however, the item is in abundant supply.

The Kraljic Matrix | How to Optimize Purchasing Costs and Risks

He holds an M. Such products represent a low value and they can be purchased in different varieties and from different suppliers. In general, raw materials belong to this category. By increasing product standardisation, much time and money can be saved. InPeter Kraljic created a matrix called Kraljic portfolio purchasing model that could be used to analyse the purchasing portfolio of a company.

This article explains the kraljic portfolio purchasing model in a practical way. There are only two ways to make money: