Supply market analysis is a technique used to identify market characteristics for specific goods or services. It provides information to assist with developing potential procurement strategies and is particularly useful for projects which are innovative in nature; complex; or are characterized as high risk. This activity should be conducted in conjunction with demand analysis.
Benefits of supply market analysis
1. Supply market analysis can provide a strategic understanding of how a market works; the direction in which the market is heading; its competitiveness; the existence of adequate capacity; who the key suppliers are; the value that suppliers place on the agency as a
customer; and the sustainability opportunities and performance within the market.
2. The information gathered through supply market analysis helps to manage risk by identifying and analyzing potential supply difficulties associated with suppliers or the market.
3. It can also assist in developing strategies to shape the market in a way that will increase the supply base; potentially increase competition; provide innovative responses to constraints or opportunities; and progress sustainability objectives.
4. The results of this analysis can help the buyer to improve and shape the strategy and tendering process and align their behavior in order achieve better value for money, reduced prices or an improved service.
5. Marketing surveys are a great way to ask for feedback on new products, services, and features.