Back to Riskipedia Index

A sole-source purchase occurs when only one supplier for a required component/part/material is available. In some cases, a sole-source supplier may hold a patent for a particular component used in the buying company's final product. Though alike, sole-sourcing should not be confused with single-sourcing, as single-sourcing implies the buying company weighs its options and chooses to partner with a single provider. With sole-sourcing, buying companies do not have a choice but to rely on that particular supplier. However, sole-sourcing is similar to single-sourcing in that supplier failures can result in acute business interruptions.

Back to Riskipedia Index