Placement method and case study

Positioning your categories on the Kraljic matrix

Objective: Learn the step-by-step method to position your categories on the matrix, and understand how categories can move over time.

5-step placement method

List the categories: Reuse the Spend Analysis taxonomy (15-25 level-1 categories)
Score the financial impact: For each category, assess the % of spend and business impact (score 1-5)
Score the supply risk: Assess the number of alternatives, complexity, switching costs (score 1-5)
Position on the matrix: Place each category in the quadrant matching its 2 scores
Validate and adjust: Confront the positioning with stakeholders and adjust if necessary

Case study: Industrial company

Example positioning for a mid-size manufacturer (EUR 500M revenue, EUR 250M spend):

Category	Impact (1-5)	Risk (1-5)	Quadrant	Strategy
Office supplies	1	1	Non-critical	Automate, P-card
Road transport	4	2	Leverage	Annual e-auction
Cardboard packaging	3	1	Leverage	Volume consolidation
Machine spare parts	2	5	Bottleneck	Safety stock
Instrument calibration	1	4	Bottleneck	Long-term contract
Special steel	5	4	Strategic	Partnership, hedging
Electronic components	4	5	Strategic	Co-development
IT services (ERP)	4	4	Strategic	Quarterly SBR

Strategic moves within the matrix

Categories are not fixed. The Category Manager can act to move a category towards a more favourable quadrant:

Bottleneck to Non-critical: By developing alternatives and standardising specifications to reduce the risk
Strategic to Leverage: By qualifying new suppliers and reducing technical complexity to lower the risk
Leverage to Non-critical: By automating processes and reducing the relative financial weight

🏢 Example move: Plastic components

In 2022, the injected plastic components category sits in the Strategic position (impact 4, risk 4) because a single supplier masters the mould and the formulation. In 2024, after qualifying a second supplier and partially transferring the moulds' intellectual property, the category moves to the Leverage position (impact 4, risk 2). Result: competitive tendering and 12% savings.

💡 Key takeaway: The Kraljic matrix is not static. The Category Manager acts to move categories towards more favourable quadrants by developing alternatives, standardising specifications or acquiring intellectual property. Strategic repositioning is one of Category Management's most powerful levers.

👉 RFx execution per quadrant (sourcing strategy, auctions, RFP): see the Strategic Sourcing course (Modules 4-5).