How do you calculate a supplier risk score?

Multiply severity by occurrence by detection using a consistent scale. In this example a severity of 6, occurrence of 4, and detection of 3 combine into a normalized supplier risk score of about 4.55.

What is a good supplier risk score for rare earth materials?

Lower is better. On the normalized scale here, scores under about 3 are low concern; the 4.55 result is a mid-tier risk that warrants a documented mitigation such as a qualified second source or buffer stock.

Why multiply the three scores instead of adding them?

Multiplication ensures one bad dimension dominates. A sole-source dysprosium supply with poor detection stays high-risk even if the disruption seems unlikely, which is exactly how rare earth supply shocks behave.

What does the detection score mean for supply risk?

Detection reflects how early you would see a disruption coming — a high (bad) score means you would only learn of a shortage when the material fails to arrive. Better forecasting, supplier scorecards, and market intelligence lower this score.

Supplier risk vs single-source risk — what's the difference?

Single-source risk is one input to severity and occurrence. The supplier risk score is broader, combining how bad a disruption would be, how likely it is, and whether you'd catch it in time, into one comparable number.

How often should I rescore rare earth suppliers?

At least annually, plus any time export controls, pricing, or supplier financial health shift. Rare earth markets move fast, so a score six months stale can badly understate current exposure.

Rare Earth Magnet & Motor Materials calculator

Supplier Risk Calculator

Supplier risk scoring adapts the FMEA severity-occurrence-detection model to the rare earth magnet supply chain, where a single interruption in neodymium, dysprosium, or praseodymium feedstock can halt an entire motor program. Sourcing managers and supply-chain engineers use it to rank vendors and material streams by exposure so mitigation effort — dual-sourcing, safety stock, long-term contracts — lands where it matters most. Rare earth supply is famously concentrated by geography and refining capacity, so severity is often high even when occurrence seems low, and poor early-warning visibility can turn a manageable disruption into a line-down event. The multiplicative score deliberately punishes any dimension that scores badly, mirroring how a magnet program with no visibility into a sole-source supplier is dangerously exposed regardless of the other factors.

What this calculator does

Estimate supplier risk for rare earth magnet and motor materials using production-ready inputs so teams can rank risks and decide which issue needs containment, controls, or escalation first.
Use it when supplier risk in rare earth magnet and motor materials needs a defensible ranking against other rare earth magnet and motor materials risks for the next review.
It multiplies severity, occurrence, and detection scores into a single supplier risk priority number for a given rare earth material or vendor.

Formula used

Supplier risk score = supplier risk severity score × supplier risk occurrence score × supplier risk detection score
Use the same scoring scale across comparable supplier risk risks.

Inputs explained

Severity of a rare earth supply disruption:
Likelihood the supplier disruption occurs:
Ability to detect the disruption early:

How to use the result

Use it during supplier qualification, annual risk reviews, or when a geopolitical or pricing shock forces you to re-rank magnet feedstock exposure.
The score is only as consistent as your scoring scale — comparing a supplier rated on a 1-10 severity scale against one rated 1-5 is meaningless.

Current U.S. benchmarks

The producer price index for copper and brass mill shapes stands at 559.593 (BLS, May 2026), up 76.8% from a year earlier. Quotes priced off last quarter's material cost miss this move. Global copper trades at $13,484 per tonne (IMF via FRED, May 2026).
The U.S. has 5,397 electrical equipment and appliances establishments employing about 369,437 workers (Census County Business Patterns, 2023).

Common questions

How do you calculate a supplier risk score? Multiply severity by occurrence by detection using a consistent scale. In this example a severity of 6, occurrence of 4, and detection of 3 combine into a normalized supplier risk score of about 4.55.
What is a good supplier risk score for rare earth materials? Lower is better. On the normalized scale here, scores under about 3 are low concern; the 4.55 result is a mid-tier risk that warrants a documented mitigation such as a qualified second source or buffer stock.
Why multiply the three scores instead of adding them? Multiplication ensures one bad dimension dominates. A sole-source dysprosium supply with poor detection stays high-risk even if the disruption seems unlikely, which is exactly how rare earth supply shocks behave.
What does the detection score mean for supply risk? Detection reflects how early you would see a disruption coming — a high (bad) score means you would only learn of a shortage when the material fails to arrive. Better forecasting, supplier scorecards, and market intelligence lower this score.
Supplier risk vs single-source risk — what's the difference? Single-source risk is one input to severity and occurrence. The supplier risk score is broader, combining how bad a disruption would be, how likely it is, and whether you'd catch it in time, into one comparable number.

Last reviewed 2026-05-12.