Max HenryFounder & Executive Director, Global Supply Chain Council (GSCC) · Founder & Executive Director at Global Supply Chain Council (GSCC)

Smart Budgeting: Beyond Cheapest to Best Value #shorts

11 Aug 2026 · 1 min

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In this short, the speaker explains a smarter budgeting and procurement approach that goes beyond simply picking the lowest‑price item. Using a battery purchase as an illustration, he emphasizes evaluating the total cost of ownership (TCO) to select the best‑in‑class product, while simultaneously establishing a diversified supplier base (A, B, C, D). The primary supplier (A) meets immediate needs at the lowest cost, but secondary suppliers (C and D) are contracted despite higher prices because they provide greater resilience and reliability, ensuring continuity if the primary source is disrupted. The overall message is to balance short‑term cost savings with long‑term risk mitigation and value.

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Because you see, the CFOs or anyone would always ask you about the budgets and the cost. So let's say I gave you the example of a battery earlier, if I recall. So where I said that I'm trying to buy not the cheapest battery, but obviously from a TCO perspective, the best battery in class. But at the same time, I'm also building alternatives in that matter as well. So I'm not getting it with one supplier, but I'm getting with A, B, C, and D. Yes, maybe my immediate needs would be with the primary supplier with A. But then I'm also signing off with supplier C and D, who may be higher in cost, but they have a better resilience, reliability. Tomorrow something happens, I can— I know I can shift to on that part as well.