A Proposed Supplier Segmentation Criteria in Indonesian Manufacturing Industry

The supplier management relationship is one of the most crucial supply chain-related activities for most firms working with multiple suppliers. Purchasing and supply management significant influence on the competitive advantages of a buying company. Purchasing Portfolio Matrix (PPM) - Supplier Portfolio Matrix (SPM) framework allows decision-makers to segment suppliers based on supplier characteristics and their relationship with the buying company. Supplier segmentation use combined PPM-SPM segmentation in the Indonesian manufacturing industry observes to be able to manage supplier relationships. This paper proposes an integrative approach that includes variables regarding supplier risk, profit impact, supplier willingness, and supplier capabilities as dimensions criteria for segmenting suppliers, as the first step in supplier relationship management strategies, based on the literature review and validation of experts. Experts validated the research through semi-structured interviews and questionnaires. The results of this study could be useful decision-makers and practitioners to address the supplier segmentation criteria highlighted in the manufacturing sector.