Supply Chain Tiers
Tier 1 Suppliers are direct suppliers of the final product. Tier 2 suppliers are suppliers or subcontractors for Tier 1 suppliers. These tiers can extend further as needed.
Tech Company Tiers
What is a tier 1 tech company?
- Google, Meta, Netflix, Databricks, Apple, Amazon, Salesforce.
- Roblox, LinkedIn, Asana, Dropbox, Airbnb, Square, Cash App, Stripe, TikTok, Adobe.
- Honorable Mentions: Cisco, Oracle, IBM, Chewy, Groupon, Grubhub, Walmart Labs, Snap, Riot, and Epic Games.
Banking Capital Tiers
What is tier 1 or tier 2?
Tier 1 and Tier 2 capital are types of assets held by banks. Tier 1 capital is a bank’s core capital, used daily. Tier 2 capital is supplementary, held in reserve. Banks must hold certain percentages of these assets. Under Basel III, Tier 1 and Tier 2 assets must be at least 10.5% of risk-weighted assets.
- Tier 1 capital includes shareholders’ equity and retained earnings.
- Tier 2 capital includes revaluation reserves, hybrid capital instruments, and subordinated term debt.
Understanding Tier 3 Suppliers
What are Tier 3 companies?
Tier 3 suppliers or partners work in raw materials. For example, the farm that sells cotton to the fabric mill is a Tier 3 supplier. Understanding your suppliers helps address sustainability and social responsibility.
- Start by mapping your supply chain to identify all materials and partners.
- This understanding is crucial for sustainability initiatives, including scope 3 greenhouse gas emissions.