Purchasing competition impact

The strategic importance is shown through the classiflcation of different purchasing items. These are, as already explained previously in this chapter, four different items -namely, strategic, leverage, bottleneck and noncritical items— as derived from the Kraljic matrix. The risks connected to these items can be derived from this model. Variables that impact these risks are availability, number of suppliers, competitive advantage, make-or-buy opportunities, storage risks and substitution possibihties (Kraljic 1983 Park et al. 2010). 

Industrial policy in Brazil generally recognizes the potential of public procurement to promote competition in markets where government demand is significant, such as health. Rules have been defined for the use of public purchasing power, which allow a price preference of up to 25% for purchases from domestic producers, using a method of calculation that takes into account employment and income generation, impact on tax revenues, national development and other factors. ... 

---