SOURCING

Sourcing: The process of finding suppliers

World Products: Products you can purchase all over the world.

Commodities: Products that have a comparable quality all

over the world and only differ in amount, price, time and are used to manufacture the world products.

5 REASONS TO DO OUTSOURCING

1. Reduce Costs2. Create Flexibility3. Improve Product Quality4. Improve Image5. Concentrate on Core

Business

DISADVANTAGES OF OUTSOURCING

Quality Plagiarism Loss of Control Cost Intensive Lack of Market Knowledge

OUTSOURCING DONE RIGHT

IBM, Acer and Dell buy components all over the world and assemble them in 1 factory.

Key factor is a well thought out plan in regards to administration and supply chain management.

OUTSOURCING GONE WRONG

Philips relocated high quality sector from china back to Holland.

Key Factors were an increase in HR costs as well as higher personnel fluctuation.

Boeing decided to outsource component building for the Dreamliner.

Key Factor is quality. Parts didn’t fit together, production was delayed and budget overstressed