Global Supply Management

The Importance of Global Supply
1. Reasons for Global Purchasing
  1. Unavailability of Items Domestically
  2. Price and Total Cost
  3. Government Pressures and Trade Regulations
  4. Quality
  5. Faster Delivery and Continuity of Supply
  6. Better Technical Service
  7. Technology
  8. Marketing Tool
  9. Tie-in with Offshore Subsidiaries
  10. Competitive Clout
2. Potential Problem Areas
  1. Source Location and Evaluation
  2. Lead Time and Delivery
  3. Expediting
  4. Political, Labor, and Security Problems
  5. Hidden Costs
  6. Currency Fluctuations
  7. Payment Methods
  8. Quality
  9. Warranties and Claims
  10. Tariffs and Duties
  11. Administration Costs
  12. Legal Issues
  13. Logistics and Transportation
  14. Language
  15. Communications
  16. Cultural and Social Customs
  17. Ethics and Social Responsibility
Selecting and Managing Offshore Suppliers
1. Global Sourcing Organizations
  1. Regional Purchasing Offices
  2. Global Commodity Management Organization
  3. International Purchasing Office (IPO)
2. Intermediaries
  1. Import brokers and agents.
  2. Import merchant
  3. Seller’s subsidiary
  4. Sales representatives
  5. Trading company
3. Information Sources for Locating and Evaluating Offshore Suppliers
  1. Internet
  2. Government sources
  3. Chambers of commerce
  4. Supply department
  5. Supply chain partners
  6. Supplier locator directory
  7. Importers and foreign trade brokers
Incoterms
1. Group E—Departure
2. Group F—Main Carriage Unpaid
3. Group C—Main Carriage Paid by Seller
4. Group D—Arrival
Tools for Global Supply
1. Countertrade
  1. Barter/Swaps
  2. Offset Arrangements
  3. Counterpurchase
  4. Buyback /Compensation
  5. Switch Trade
2. Foreign Trade Zones
  1. Manufacturing
  2. Transshipment
  3. Storage
  4. Manipulation.
  5. Refunding of duties, taxes, and drawbacks
  6. Exhibition and display
  7. Maquiladoras
3. Bonded Warehouses
4. TIB and Duty Drawbacks
Regional Trading Agreements
1. NAFTA
2. EU
3. ASEAN
4. Mercosur
5. Andean Community
6. WTO

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Global Supply Management

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