Supplier integration boosts efficiency and competitiveness in competitive supply chains
Supplier development and integration are important strategies for manufacturers to improve their supply chains. A study looked at how these strategies interact in a competitive setting. The research found that manufacturers tend to invest more in supplier development after integrating with their suppliers. In most cases, both manufacturers end up integrating with their suppliers. However, if one manufacturer is more capable in supplier development, the other may invest less after integrating. When manufacturers have the option to source from one or two suppliers, having dedicated sourcing (one supplier per manufacturer) is the most common structure.