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Supplier concentration (HHI)
Check how dependent you are on a few suppliers for a category, and review it quarterly.
Procurement & vendor managementHow it's worked out
- HHI = sum of squared percentage shares (0 to 10,000)
- Spend for one category over one period
NoteThe bands are those used in competition analysis. For supply risk, a high HHI means a single failure hits a large share of the category.
Source: US DOJ and FTC Merger Guidelines (HHI bands, 2010)
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