Panel arrangements are sourcing arrangements with multiple suppliers for the same category. They are used in situations where there are irreconcilable user preferences or when it is not possible or desirable to single source, or when the buyer wants to promote and stimulate competition. For example, the consultancy category is one in which there is a wide variety of user requirements, and it is not realistic to rationalise variety into ‘standard’ work scopes. The procurement strategy may be to reduce the number of providers, and place the selected providers on a panel arrangement, so that the category spend can be consolidated with a reduced number of providers, each of whom agrees to the organisation’s terms and conditions. A rate card may be negotiated for ad-hoc work. See also Sourcing Strategy.
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