Sourcing and Procurement
Glossary
Your trusted guide to exploring sourcing and procurement terms & definitions,
from the world’s leading procurement experts and companies
Backsourcing
The process of recapturing and taking responsibility internally for processes that were previously outsourced to a contract manufacturer, fulfillment or other outsourced service provider. Backsourcing typically involves the cancellation or expiration of an outsourcing contract and can be nearly as complex as the original outsourcing process.
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Balanced Exchange
In negotiations, a term used to describe an equitable exchange. When one party takes value from a relationship the other party must replace it with equal benefit. For example, I give you a $1 and therefore in exchange, you give me a widget.
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Bartering
A type of transaction involving no money or cash where one party provides one type of goods in exchange for another type of goods. Bartering can be carried out domestically or globally.
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Baseline
A basis for comparison set by monitoring the initial performance of a process. The baseline is used as a reference point to evaluate performance improvement efforts.
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Basic Transaction Model
A Sourcing Business Model that typically has a set price for individual products and services for which there are a wide range of standard market options. These products or services are viewed as readily available, with little differentiation in what is offered.
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Balance Sheet
A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time.
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Balanced Scorecard
A balanced scorecard is an effective way to track category performance against targets. A balanced scorecard measures category performance, spans across multiple types of value and across multiple areas in those values, and may use multiple KPIs.
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Barrier to entry
Often high costs or high levels of competition, linked to supplying a new product or service into a market.
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Base price
The initial price of something without the added costs such as handling, transport and profit
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Baseline Cost
An essential element of Total Cost Analysis is to establish a baseline cost, as it will provide the foundational understanding of all future cost analysis of the product or service being reviewed. In order to arrive at the baseline, examine all of the key cost elements of a product or service. The baseline identifies the key areas of cost and their relative size and proportion in comparison to all of the other costs of producing a product or delivering a service.
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Basic Transaction Provider
A basic transaction provider is a supplier that operates under a simple buy-sell arrangement where buyers typically pay a set "transaction" price for products or services.
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