22 August 2025

Dual sourcing without duplicating cost

Procurement likes a second vendor because the slide looks balanced. Operations likes a second vendor if the second vendor can actually ship when the first one cannot. Those are different sentences. The Supplier Dual-Sourcing Lab exists to keep them from being merged in a QBR.

A chemicals buyer in Altona held two contracts on a resin grade. Both contracts routed through the same industrial park and, on bad weeks, the same customs broker. When the park flooded a car park, both “sources” aged together. The extra cost of dual commercial terms had bought zero extra geometry.

A cheaper dual path is often a qualified mill on a different berth with a smaller volume share and a tested quality file — not a second logo on the same dock. Quality files take months. That is why this work cannot be a two-hour workshop. Paying twice for inventory while sharing a mill is the expensive version of comfort.

Draw the joints. If the joints coincide, say so. Then decide whether you are buying a commercial hedge or a physical one. They price differently. Only one of them belongs in a disruption script.