Leverage Market Imbalances
Market imbalances are phenomena that usually only exist in economic theory. In this strategy, the aim is to systematically identify market imbalances and exploit them for procurement purposes. Such imbalances can come about as a result of differing capacity utilization across certain regions, variable price mechanisms , or currency fluctuations.
Market imbalances can be recognized by checking core indicators for certain supplier markets at regular intervals. These core indicators include national price indices for various material groups (in combination with exchange rates), or capacity utilization figures for certain industries. Examination of the differences in these core indices or comparisons across countries can provide a good overview of the materials costs. It may be found, for instance, that certain cost developments are restricted to a specific region and can be circumvented by changing to a supplier in another country.