Fourth parties: Concentration risk and its mitigation

Abstract

The aim of this paper is to describe various types of concentration risk in the supply chain, provide some examples and explain why these are important to regularly analyse. In addition, it sets out why we should be including fourth parties in our analysis and some suggestions of how this can be done. The paper demonstrates that the key to efficient concentration risk analysis is being data-driven and linking this back to an organisation’s own business resilience. The reader can expect to have a good understanding of the types of concentration risk and how to start gathering data to drive the necessary analysis.