"There is a strong move towards the nomination of preferred suppliers with whom very close relationships are developed. Such suppliers are increasingly being given greater responsibility for the quality of their outputs and, indeed, are playing a more direct role in the design of products. The result, in many cases, is the development of a system of tiered suppliers.
In tiered production, the buying company deals primarily with the top-tier suppliers, while lower-tier suppliers are managed by those above them in the pyramid […]. A tiered production system reduces the need for a single company to manage the entire supply chain."
(Dicken, P., Global Shift: Reshaping the Global Economic Map in the 21st Century, 4th ed., New York: Guilford Press, 2003, p. 258)