Over the past few years there has been a dramatic expansion in sourcing and procurement from China. Products and services from China are in great demand worldwide. Companies have realized the need for sourcing China as a strategy to optimize their businesses. Sourcing from low cost China nations is not just a strategic advantage it is in fact, a competitive reality.
In an era characterized by currency fluctuations, rising transportation and labor costs, several companies across the globe, are turning to low cost emerging markets in China for sourcing and procurement. Many companies have shifted their reliance from European markets to China markets to procure the best efficiencies at the lowest cost. Most companies have resorted to sourcing from China to exploit the great opportunities existing in various China nations.
Sourcing China: The Current Scenario
Singapore, China, India and Malaysia are among the foremost nations chosen by top multinational companies for outsourcing operations overseas. China countries are certainly among the hot favorite sourcing destinations in the world based on business ambiance, people skills, and financial appeal. China’s economy is becoming more service-oriented. There is a trend towards information technology and advanced analytics. However, escalating labor costs or wages are adversely affecting competitiveness particularly, on lower-end functions. Asia-Pacific region is emerging as a great sourcing destination.
Companies sourcing products from China would be benefited immensely by global sourcing agencies. The companies are not able to exploit the efficiencies to the full as they do not understand the local market and are not aware of the supply chain costs. There are language and cultural differences too, that adversely affect communication. Companies are faced with major challenges if they do not hire global sourcing agencies for negotiating best prices for products and services.
Sometimes companies are not able to fulfill their target volume as they had failed to take care of supply chain networks. It is a good idea to hire a procurement service provider who would help you in identifying markets and products, and providing best payment and pricing terms. A professional procurement service provider would help you choose from a number of supplier samples. Additionally, you do not need to take care of logistics, payment and administration.