Global sourcing has become a bit of a buzzword in business and, by now, almost everyone has added their own two cents on the matter.
But what if we could take the ethics out of international sourcing for a moment and simply look at how it could affect your bottom line? Is it worth making the switch for its benefits and is there a way to work around its drawbacks?
The Pros 👇🏻
Reduce production costs. Let’s kick things off with everyone’s favorite part of global sourcing—saving money on the products themselves! The majority in savings from outsourcing your products internationally comes from the comparative labour costs overseas compared to the hourly wage.
Access experts in the field. If you need to get your car serviced, you go to a mechanic. The same idea applies to product manufacturing. Each geographical area has products its workers excel in.
Increase manufacturing productivity. You save time when globally sourcing to countries that have much better access to raw materials. You can then process these materials into your products in a factory near their source—rather than being imported, then processed.
The Cons 👇🏻
Quality Control. With so many overseas manufacturers to choose from, there are going to be companies that won’t meet your business’s standards.
Supply Chain Delays. Globally sourcing to international manufacturers not only extends your supply chain physically, but quite literally too. Having more links in the supply chain means more room for error, such as factory shutdowns, transport delays, or disruptions in the workforce.
Communication Issues. The root of all kinds of issues revolves around communication breakdowns, and international sourcing is no exception!
Working with companies often halfway around the world from you comes with its own set of challenges, such as working in different time zones, delays in response times, language barriers, and a general lack of rapport with your contact because of poor communication methods.
The right sourcing agent knows how to tip the scales in the pros column and ensure success for your end-end sourcing needs.
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