The challenges of choosing the right global sourcing company to work with can be daunting. It’s not easy to know if they’re trustworthy, or if they’ll give you the lowest price possible without sacrificing quality. If you decide to go this route, here are the seven steps you need to take to develop your strategy.
Recognizing the Problem
Over 25 percent of US manufacturing jobs have been lost in just eight years, according to The Conference Board. While China continues to grab headlines for its handling of foreign companies, other countries are also becoming popular choices for many organizations looking to implement global sourcing strategies.
Finding an Experienced Partner
The second stage of sourcing has to do with finding an experienced supplier. That can be tricky, but one way to locate an experienced supplier is to work with a sourcing agency. A good global sourcing company will act as your agent and facilitate communication between you and suppliers around the world. When working with an experienced partner, such as a sourcing firm, you can be sure that all channels of communication are open.
The relationship should be formalized so that it meets both parties’ needs for security and reliability; most firms require multi-year commitments from clients. Having such a long-term commitment makes sense in terms of finding suppliers who will adhere to ethical standards—and that, after all, is what you need if you want your brand’s reputation protected worldwide.
Analyzing Your Need in detail
Once you’ve decided on a sourcing strategy and have established goals, it’s time to identify your specific needs. What are you looking for? How much do you want to spend?
For example, if your goal is cost savings, but one supplier can offer those savings while using unethical labor practices (like child labor), then they may not be right for your company—even if they can help cut costs.
You’ll also want to assess whether or not you have any risks or potential challenges that might be unique to your business.
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Conducting Assessment Process on Several Partners
Conduct an assessment process on several global sourcing companies. Find one that is professional and has extensive experience in overseas sourcing for other businesses in your industry. Make sure you get all of their suppliers as well, so you can build a positive relationship with them from day one. Don’t skimp on quality – always choose domestic suppliers who have strong reputations and are willing to work with you in order to build trust.
Trust is essential if you want to maintain long-term relationships with these types of firms; it will take some time before they feel comfortable handing over large orders and a lot of product information to you, but once they do, everything will run much more smoothly and efficiently.
Defining Your Specific Needs
The step in developing your global sourcing strategy is to get specific about your own needs. What do you need help with? What are your goals? Does it make sense for you to be involved in all stages of sourcing or just certain ones? Will you use an in-house staff or an external company, and what kind of company should it be (e.
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g., strategic sourcing consultant vs. logistics services provider)?
You’ll also want to consider what level of automation makes sense for your business, as well as how much control and oversight you want over each stage.
Selecting the Right Supplier
Your first order of business should be to find at least three or foursourcing company in usa. One of them will be an overseas supplier and another a domestic source; some companies also use multiple sources within their own country. Then you’ll have to decide how much control you want over your supply chain, and whether you’re willing to handle all aspects of production or just one aspect (and if so, how far down in that process do you want to get involved). As you assess potential vendors, remember that communication is key. Make sure everyone is on board with your vision for sourcing.
Maintaining your new global sourcing company relationship.
You’ve gotten your new product onto store shelves and you’re making sales. Congratulations! This is an important milestone, but by no means are you done. Now it’s time to maintain your relationship with your global sourcing company (GSC). Unfortunately, there isn’t much of a formula for doing so—while some GSCs will keep in touch via email throughout each stage of production, others won’t communicate at all until finalizing orders.
Developing a successful global sourcing strategy requires as much thought and planning as any other important initiative in your business. As we discussed earlier, it’s essential to bring together key stakeholders from different areas of your company and seek input from knowledgeable outside sources.
The process is not something you can do quickly, so take your time, be thorough, and make sure you have buy-in across all departments before moving forward. If you follow these steps then developing a global sourcing strategy will be easy and rewarding!
If you need help getting started or want additional information or resources then contact us today! One of our experts will be happy to assist you. I hope you found my post useful! Please remember to leave me any feedback that might help me improve future posts! Thank You!