The Hunger Games of Procurement: When Diversifying Suppliers Can Backfire

A new study by Kühne Logistics University (KLU), the University of Groningen, and Portland State University shows that some textbook procurement strategies can become ineffective or even counterproductive. In extreme cases, relying more closely on one supplier may actually make a company more resilient.

Published in the International Journal of Physical Distribution & Logistics Management, the study examines “unmitigable supplier dominance”: situations in which buyers have little bargaining power and cannot realistically escape dependence on powerful suppliers.

“Most procurement strategies assume that buyers have choices,” says Associate Professor Tri Mikael Tran, Research Director of KLU Asia and lead author of the study. “But sometimes those choices simply do not exist. The first question is no longer ‘What is the best procurement strategy?’ It is ‘Which strategies are actually possible?’”

The central message is simple: strategy feasibility comes before strategy selection.

More Suppliers Do Not Always Mean More Resilience

Supplier diversification is generally considered safer than relying on one supplier. But diversification offers little protection if several suppliers ultimately depend on the same factory, country, raw material source, or transport route.

It can even weaken the buyer’s position. When critical supplies are scarce, concentrating purchases with a trusted supplier may help a company become a preferred customer and receive priority during shortages.

One company in the study deliberately sourced a critical ingredient from a single supplier. Although this contradicted conventional diversification principles, the relationship helped secure access when supplies became scarce.

“Dependence is normally treated as a risk,” says Tran. “But if a resource is truly scarce and cannot be substituted, a strong relationship with one powerful supplier may secure access better than superficial relationships with five suppliers.”

Two Questions: How Urgent? How Replaceable?

Rather than recommending one universal strategy, the researchers argue that companies should first assess two characteristics of critical supplies:

How urgent is the supply? Can production continue without it, or does disruption stop operations immediately?

How substitutable is it? Can another material or supplier realistically replace it without violating specifications, quality requirements, or regulations?

These dimensions determine which strategies are feasible. Urgent and difficult-to-replace supplies call for securing access through strong relationships and bargaining power. Urgent but replaceable supplies require flexibility and backup sourcing. Less urgent supplies allow more time for developing alternatives, redesigning specifications, or structuring contracts.

Across these situations, capabilities such as supply chain visibility, collaboration, vertical integration, and bottleneck management remain important foundations for resilience.

The study draws on 11 small and medium-sized Spanish agri-food companies and an industry expert organization, based on interviews conducted during the severe disruptions following COVID-19 and Russia’s invasion.

More information:

• Original publication: Tran, T. M., Aguinaga Oficialdegui, L., & Pullman, M. (2026). “The Hunger Games: Procurement Strategies under Unmitigable Supplier Dominance.” International Journal of Physical Distribution & Logistics Management, 56(11), 505–528. https://doi.org/10.1108/IJPDLM-07-2025-0363
• Authors: Tri Mikael Tran (Kühne Logistics University / University of Groningen), Laura Aguinaga Oficialdegui (University of Groningen), and Madeleine Pullman (Portland State University)
• Associate Professor Tri Mikael Tran: KLU faculty profile