Gone are the days when merchant ships would take months and planes would take days and weeks to sail or float around the world from one seaport or airport to another or travel from one part of the country to the other. Science and technology have shrunk distances. Outsourcing is the transfer of production of goods and services by one company to another independent company usually for cost benefits (Keat & Young, 2009). The practice has been around for years and is also known as offshoring when it
companies. When China is getting increasingly expensive to operate in, isn’t there a closer favourable option for Swedish apparel companies to manufacture their garments? The research seeks to investigate the two sourcing strategies nearshoring vs. offshoring, and if nearshoring could be more favourable option. It compares the two biggest countries of apparel manufacturing to Sweden, Turkey and China. The research takes a Swedish apparel company perspective: China is 6378 km and seven times zones away
The Truth behind Outsourcing Outsourcing is when a company or business decides to contract part of their services that they do not do well to an outside company. There is two types of outsourcing offshoring and nearshoring. Offshoring is where a company outsources abroad and, nearshoring is outsourcing within the home country. The reasons that a company decides to outsource varies from company to company but, the most common ones are cost reduction, increasing globalization, growth , tax incentives
The main objective of any individual or group going into business is to make profit. Their profit is the difference between the cost of providing the good or service and the actual cost to the consumer. As more companies venture into the same line of business the competition for customers gets intense thus bringing into play the law of supply and demand. Oversupply of a good or service pushes the price consumer has to pay down. These forces have pushed managers and business strategists into
Outsourcing relationships demand the same care and attention to sound management principles and practices as do in-house operations and valued employees. Managed well, continuous improvement, increasing value, and constant innovation can be expected. Managed poorly, the services and overall relationship deteriorates resulting in higher costs, operational disruption and lost business opportunities. Financial savings from lower international labor rates was the most important motivation for the early
On the top of the house it says: Pursuit of perfection. For an enterprise we can identify it with the so called Iron Triangle of product management: Time, Cost and Quality. These are three main factors that should be balanced, so the product can be successful. The quality is understood basically as creating a product that does what is supposed to do. This includes performing as expected, not having defects, lasting as long as expected, being delivered when expected, and being produced in safe conditions