Sole Sourcing
Definition
A situation where only one supplier is capable of providing an item or service, leaving the buyer with no practical alternative source.
In Practice
Sole sourcing is imposed by circumstance rather than chosen. It arises from patents, proprietary technology, unique tooling ownership, regulatory approvals tied to one manufacturer, or a customer specification that names a particular brand. Unlike single sourcing, there is no qualified alternative to switch to, which fundamentally changes the negotiating dynamic: the supplier holds most of the leverage.
Managing sole-source items means managing dependency. Common tactics include long-term agreements that lock in price and capacity, buying safety stock or lifetime buys before end-of-life, negotiating access to tooling or designs, and funding qualification of an alternative where technically feasible. Planners should flag sole-source parts explicitly, because a delay has no workaround.
Example: a medical device uses a sensor for which only one manufacturer holds the regulatory file. When the manufacturer announces discontinuation, the buyer places a lifetime buy covering five years of forecast demand while engineering qualifies a replacement.
Related Calculators
Related Terms
A deliberate strategy of buying an item from one supplier even though qualified alternatives exist, usually to maximize volume leverage and simplify management.
Dual SourcingA sourcing strategy that splits an item's volume between two qualified suppliers to balance cost leverage against supply risk.
Supplier Lead TimeThe elapsed time from placing an order with a supplier until the goods are received and available for use, including production, transit, and receiving.