Products pass through hundreds, sometimes thousands of suppliers on their way to market.  Until recently companies only knew about a small fraction of these suppliers - the ones that they have direct contracts with. Supply Chain Mapping was created to give companies visibility into the rest of the supply chain, all the way back to the farms, forests and mines where raw materials come from. 

Companies have always known their Tier-1 suppliers, the ones that they transact with directly, and who are usually managed in a bookkeeping or enteprise planning system (ERP). The Tier-2 suppliers are managed by the Tier-1. Tier-3 is managed by Tier-2. As a result, companies have no direct record of who supplies their suppliers - the supply chain lives across fragmented systems.

n-Tier Mapping

Supply chain mapping expands the known supplier universe of a company from its tier-1 (direct suppliers) to its Tier-2, Tier-3, Tier-4 suppliers, all the way to Tier-n (the raw material suppliers). Software like Sourcemap maps the global network of suppliers by collecting information from Tier-1 suppliers on Tier-2, from Tier-2 suppliers on Tier-3, and so on until the raw materials suppliers have been identified. In the process, the supplier database for a Tier-0 (customer) can grow by as much as ten times larger, and it's not uncommon for supply chains to span five tiers or more.

Assigning a Supplier Tier 

A supplier's tier is determined by the company doing the mapping - the same supplier can sit in different tiers for different customers. For an oil refinery, an oil well can be considered a Tier-1 supplier. For a consumer electronics manufacturer, the oil well could be a Tier-5, or even a Tier-10 supplier. 

Even within one company's supply chain, a supplier can exist in multiple tiers. Some companies are vertically integrated, playing several roles: a paper mill (tier-1) might also own a forest and its forestry operation (tier-2). Others fulfill non-sequential roles: a metal stamping factory (tier-3) might send a product to a supplier for powder-coating (tier-2) and take it back for final assembly (tier-1). 

Finally, Tier-n: supply chain mapping ends where supply chains begin: at the raw materials. Raw materials suppliers are called Tier-n because they can exist at a different level, which is sometimes impossible to know until mapping is complete. 

n-Tier Mapping in Practice

n-Tier mapping is becoming mainstream, primarily used to that supply chains are resilient in the face of shifting regulations and market disruptions, to ensure the standards in place at every tier of a supply chain, and to make supply chains more efficient. 

To find out how much companies stand to benefit from supply chain mapping as a way of protecting their most valuable assets - their reputations, their reliability, and the quality of the products they bring to market - get in touch with our analysts.