How a Buyer Used Supplier Tiering to Cut Procurement Costs 18 Percent

The Buyer's Side with Fexingo: Procurement, Sourcing, and B2B Purchasing Decisions · Jul 3, 2026 · 10m · transcript

In Episode 90 of The Buyer's Side, Lucas and Luna explore how a mid-sized automotive parts manufacturer used supplier tiering to reduce procurement costs by 18 percent without sacrificing quality. The buyer reclassified 400 suppliers into strategic, preferred, and transactional tiers, then allocated 80 percent of spend to the top tier. The result: fewer RFPs, consolidated volumes, and stronger relationships. Lucas breaks down the tiering framework, the negotiation leverage it created, and the hidden cost of managing too many suppliers. Luna questions whether tiering can backfire if a…