Compared to a blanket purchase order, a supplier alliance agreement is best differentiated by:

Compared to a blanket purchase order, a supplier alliance agreement is best differentiated by:

A. efficient material replenishment processes.

B. clearly identified roles for the buyer and seller.

C. a shared vision of added value.

D. a sole-source agreement.

View Answer

Answer: C

Explanation:

A supplier alliance agreement and a blanket purchase order differ significantly in their scope and strategic intent.

The steps to differentiate them are:

Blanket Purchase Order: This is a simple agreement where a buyer commits to purchasing a specified quantity of goods or services from a supplier over a set period. It focuses primarily on transactional efficiency and cost savings through bulk purchasing.

Supplier Alliance Agreement: This is a strategic partnership where both parties work closely to achieve mutual goals. It goes beyond transactions to involve collaboration, trust, and long-term commitment.

Shared Vision of Added Value: In a supplier alliance agreement, both buyer and seller share a vision of creating added value. This can involve joint product development, process improvements, and innovation, benefiting both parties beyond the basic supplier-customer relationship. Roles and Responsibilities: While both agreements may identify roles, the supplier alliance agreement emphasizes a collaborative approach where both parties actively contribute to achieving shared goals.

Efficiency and Sole Sourcing: While efficient material replenishment and sole-source agreements can be part of both types of agreements, they do not fundamentally distinguish a supplier alliance from a blanket purchase order.

Reference: Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and Supply Chain Management. Cengage Learning.

Lambert, D. M., & Knemeyer, A. M. (2007). Supplier Relationship Management: A Framework for Collaboration and Innovation. Journal of Business Logistics, 28(1), 1-23. er: C