Global Sourcing Essay

1140 words - 5 pages

Global Sourcing
What are some of the risks of buying overseas that one can avoid by buying from domestic

Some risks of buying overseas that can be avoided through buying from domestic sources include:
Conducting business with immature suppliers causes risk as you do not have the same relationship and history with them that you do with suppliers you have worked with for years. You are unable to have regular ‘in person’ meetings and make assumptions that can taint your potential to have a great relationship.
Unreliable delivery is also a risk which can be avoided (or reduced) by procuring from domestic sources. When a supplier is closer, or domestic, your timelines are shorter ...view middle of the document...

3. Title to the goods can pass from seller to buyer at any point between the seller’s shipping dock and the buyer’s receiving dock. Which point should be used for the blouses Barbara’s firm is buying? Why?

Title of goods should pass from the seller to the buyer after the goods have been received at the buyers receiving dock. If the title of goods is transferred before receiving goods, any loss or damage that occurred to the goods in transit will be the responsibility of the buyers not the sellers. If the title of goods is transferred after the goods have been received at the buyers receiving dock and the buyer finds out any damage or loss then the risk is the responsibility of the seller not buyer.
4. One of the concerns of U.S. retail chains is the possibility that goods they import have been
made by child or prison labor. How can Barbara prevent this from happening with products that
she buys for her chain?

A big concern is the possibility of any goods being made by child or prison labour. Many precautions are being taken in order to stop the use of child or forced labour in making of products but no company can guarantee it. Barbara could mitigate this risk with her products by stipulating in the contract with the suppliers that she will only do business with them if they will not use any kind of forced labour, whether it is prison labour or child labour who doesn’t wish to work. She can also stipulate in the contract that if it comes to light that the goods have been made by the forced labour, the contract with the supplier will be completely terminated at their expense. Barbara could also report this illegal use of force labour to the concerned agencies which could take a legal and strict action against the suppliers. Additional action could be for Barbara to audit the locations periodically.

5. Barbara’s firm makes many purchases in Asia. How should they manage, or handle, the
physical movement of the goods from Asia to individual stores in the U.S.?

Barbara’s firm makes the majority of its purchases from Asia therefore in order to reduce the risk of loss that might incur in between the movement of goods from Asia to U.S., it is very important to correctly manage the physical movement of goods. Appropriate training should be given to the persons who are responsible for bringing the...

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