The 4 supplier segments and the scoring matrix
Objective: Master the 4 supplier segments, the 2-dimension scoring model and the optimal allocation of buyer time.
The 4 supplier segments
| Segment | Typical count | % of spend | % of buyer time (target) | Management mode |
|---|---|---|---|---|
| Strategic | 5-15 | 40-55% | 40-50% | Full-touch: quarterly SBRs, co-innovation, C-level relationship |
| Preferred | 20-50 | 25-35% | 30-40% | High-touch: half-yearly reviews, improvement plans, annual negotiation |
| Transactional | 80-150 | 10-20% | 10-15% | Low-touch: framework contracts, automated orders, basic KPIs |
| Exit | 200-400+ | 2-5% | 5-10% | No-touch: exit plan, transfer to preferred suppliers, elimination |
The 2-dimension scoring matrix
The scoring rests on 2 complementary dimensions:
Dimension 1 - Strategic Value (vertical axis)
Assesses the supplier's strategic importance for the company.
| Criterion | Weight | Description |
|---|---|---|
| Spend volume | 30% | Annual purchase amount with this supplier |
| Kraljic position | 30% | Is the category strategic, leverage, bottleneck or non-critical? |
| Innovation potential | 20% | The supplier's ability to bring innovation and added value |
| Supply chain criticality | 20% | Impact of this supplier's failure on operations |
Dimension 2 - Performance (horizontal axis)
Assesses the supplier's operational performance.
| Criterion | Weight | Description |
|---|---|---|
| Quality | 25% | Conformity rate, PPM, complaints, certifications |
| Delivery (OTD) | 25% | On-Time Delivery, respect of logistics commitments |
| Price competitiveness | 20% | Price position vs. market, tariff evolution |
| Compliance and CSR | 15% | Respect of regulatory, ethical and environmental requirements |
| Collaboration | 15% | Responsiveness, communication, proactivity, crisis management |
Positioning on the matrix
- Strategic quadrant: High strategic value + high performance = first-rank partners
- Preferred quadrant: Medium-high strategic value + decent performance = reliable suppliers to develop
- Transactional quadrant: Low strategic value + variable performance = simplified management
- Exit quadrant: Low strategic value + low performance = elimination plan
💡 Key takeaway: Supplier segmentation rests on an objective scoring crossing Strategic Value and Performance. The goal is to focus 40-50% of buyer time on the 5-15 strategic suppliers that represent 40-55% of spend and the highest value-creation potential.