Council of Supply Chain Management Professionals (CSCMP) Practice Exam 2025 - Free CSCMP Practice Questions and Study Guide

Determining the right number of suppliers is crucial for developing suppliers that can keep pace with business growth. A well-balanced supplier base allows a company to manage risk effectively, ensures flexibility, and maintains quality while meeting increased demand. By identifying an appropriate number of suppliers, a business can ensure that it is not overly reliant on a few entities or overwhelmed by too many, which can complicate supply chain management.

Having the right number of suppliers enables a company to foster strategic partnerships and build collaborative relationships that can enhance innovation and responsiveness to market changes. This approach also contributes to better negotiation power, as a balanced supplier portfolio provides alternative options without creating excessive complexity in vendor management.

Maintaining a small number of key suppliers, investing in technology and automation, or focusing exclusively on the largest suppliers can lead to risks such as supply disruption or lack of competitive options. Each strategy has its advantages, but they do not address the foundational need for an appropriate supplier count tailored to ongoing business demands and growth trajectories.