The decision making process in sourcing from “low cost countries” has become increasingly complex over the last 25 years as other factors impacting global efficiencies have been thrown into the mix. More and more low-cost countries have expanded their capabilities; rising wages and exchange rates have made some former low-cost destinations unattractive.
China is preferred destination for many global sourcing initiatives. It is our considered opinion that it will continue to be so for the foreseeable future. Yet, more and more Western corporations are looking for strategic counterpoints to China arising out of concerns over labor costs, currency fluctuations, labor shortages, a graying population and Chinese policy-making.
Many of our clients now consider other countries such as India, Vietnam, Thailand, Malaysia and Indonesia in that region for sourcing product from, for reasons of cost, quality, risk-management and increased capacity.
Amritt is bullish on the long-term prospects of India as a source for selected imports to the west. The US Council on Competitiveness recently ranked India as the 2nd most competitive nation for manufacturing behind China. India is now among the top manufacturers in sectors as diverse as textiles, chemical products, basic metals, general machinery and equipment, and electrical machinery according the UN Industrial Development Organization.
Amritt’s clients retain us in any or all these stages of global sourcing: Educate, Assess, Select, Transition, Manage and Troubleshoot
We conduct a needs overview to address questions such as, what are the driving forces for sourcing from India and China in your organization? What are the low-hanging fruits for sourcing? What are the risks? How can you become better prepared before you embark on this process? What are the countries best suited for sourcing your products from?
Amritt has decades of experience in answering these and other educational questions. CFOs, CEOs and head of operating groups approach us for initial feasibility studies to determine whether this is right for their company.
Decide what types of suppliers are going to match your needs. What vendor skills and experience are important to you? When does it make sense to investing in a foreign facility or building your own? At this stage you may wish to make a first cut analysis of some vendors and to develop a transition plan.
We can help you smoothen your transition from in-country or other-country sourcing to the new source in the following ways:
• Planning for inventory redundancies during the transition
• Engineering knowhow transfer, quality management including inspection services and logistics support
• Issue resolution when surprises happen
We help you define and monitor daily, weekly, monthly and quarterly reviews. We help you communicate with your suppliers and to determine how to scale your operations up or down. We can build dashboards to help you measure and track supplier performance
Occasionally we are called to fix a broken process or recover from a soured relationship. We are happy to bring our expertise to such situations and give you advice that is brutally frank but sensitive to your needs.
Our confidential services are custom-designed to fit the needs of individual clients. You may also register to have access to our white papers and newsletter.
Third Party Resources
Purchasing Magazine - 14 Tips on Doing Business in India
Management Roundtable - The Top Mistakes in Doing Business in India