Uncertainty may be defined as imperfect knowledge. Uncertainty and risk are terms that are often related. Some economists distinguish between risk and uncertainty in terms of uncertainty representing things that we cannot measure and risk representing things that we can measure. If a farmer agrees to sell this season’s crop to a retailer at $1 per kilogram, the farmer has minimised his uncertainty, he knows exactly what price he will get. However, the farmer has not reduced his risk, as the market price for his crop might be $2 per kilogram later in the season. See also Risk.

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Discover the world’s largest Glossary of Procurement terms

With over 800 Procurement specific terms (and growing) you will find everything you need to know or thought you knew about the Procurement function. Our aim is to provide you with a comprehensive list collated from the Comprara Groups hub of training and consulting source materials.The Procurement Glossary has been compiled by industry expert Paul Rogers.