Manufacturer Caspian shifted 30% of a critical component’s orders to a second supplier. Unit cost rose 5%, but during a regional shutdown the company maintained 92% of planned production, while single-source competitors experienced prolonged stoppages. Diversification is not free: duplicate qualification and smaller purchase volumes raise ordinary-period costs. Still, for components whose absence halts the entire line, the added cost can function as insurance against disproportionate disruption losses.