Which of the following is a benefit for Buyers when using SRM?

• A. Costs decrease, better service/quality, access to supplier's best people/ideas
• B. Higher inventory levels
• C. Increased supplier base
• D. Shorter supplier contract durations

Answer: (A)

Supplier Relationship Management focuses on turning supplier partnerships into value for buyers by aligning goals, sharing information, and driving performance improvements with suppliers. When buyers use SRM effectively, they typically see costs decrease through better negotiation, process improvements, and supplier-driven cost reductions, while service levels and quality improve through closer collaboration, joint quality programs, and clear performance metrics. It also opens doors to the supplier’s top people and ideas through ongoing collaboration, co-development, and access to innovations that the supplier wouldn’t typically offer to transactional buyers.

The other options miss the mark because SRM aims to reduce overall cost and risk while strengthening key partnerships, not simply increase inventory or broaden the supplier base or shorten contracts. Higher inventory levels can hide inefficiencies; expanding the supplier base adds complexity without guaranteeing value, and shorter contracts undermine long-term collaboration and investment.