Suppliers that provide parts to Tier 1 suppliers, one step removed from the manufacturer are called what?

Suppliers that provide parts to Tier 1 suppliers, one step removed from the manufacturer are called what?

• A. Tier 3 Suppliers
• B. Tier 0 Suppliers
• C. Tier 2 Suppliers
• D. Tier 1 Suppliers

Answer: (C)

Think of the supply chain in levels or tiers based on how far a supplier is from the manufacturer. Tier 1 suppliers deliver directly to the manufacturer. The next level back, Tier 2, supplies those Tier 1 suppliers. So the suppliers that provide parts to Tier 1 suppliers are two steps away from the manufacturer, which is described as Tier 2 suppliers. (Tier 0 can refer to the OEM itself, and Tier 3 would be suppliers to Tier 2.) This tier structure helps managers map risk and responsibility across the chain, since issues deeper in the network can ripple up to Tier 1 and the manufacturer.

Think of the supply chain in levels or tiers based on how far a supplier is from the manufacturer. Tier 1 suppliers deliver directly to the manufacturer. The next level back, Tier 2, supplies those Tier 1 suppliers. So the suppliers that provide parts to Tier 1 suppliers are two steps away from the manufacturer, which is described as Tier 2 suppliers. (Tier 0 can refer to the OEM itself, and Tier 3 would be suppliers to Tier 2.) This tier structure helps managers map risk and responsibility across the chain, since issues deeper in the network can ripple up to Tier 1 and the manufacturer.