Answers:
Strategic purchasing occurs when there are unique and expensive items that are very important for a company’s success. Few specialised suppliers sell such items. For example, certain chemicals, cutting edge technology, aero engines, etc., are some of the critical items that very few specialised suppliers sell. With such small number of suppliers in the market, the purchasing activity tends to develop long term relationship between a company and a supplier. This in turn develops the suppliers’ capabilities and thus provides benefits to both the purchasing organization and suppliers.