Glossary · Supply Chain
Single Source Risk
Vulnerability arising from dependence on one supplier, component, or location for critical materials, services, or production capacity.
Full definition
Single source risk creates business continuity exposure when no alternative suppliers exist for essential inputs, whether due to technical specifications, intellectual property constraints, or geographic concentration. This risk materializes through supplier bankruptcy, natural disasters, geopolitical events, or quality failures that halt production. Mitigation strategies include dual sourcing, buffer inventory, supplier financial monitoring, and design for substitutability. The 2011 Fukushima earthquake disrupted automotive production worldwide because many manufacturers relied on single Japanese suppliers for specialized electronic components and pigments.
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