FAQs of Global Sourcing

Frequently Asked Questions About Global Sourcing

1. How large must a company be to benefit from global sourcing?
Size is really not the determining factor when it comes to evaluating the benefits of sourcing.
Much of the decision depends on the type of product, part or component involved and the level of precision required. Assembly and packaging requirements must also be analyzed carefully.
2. How do we achieve a “cultural fit” with an overseas supplier?
The 11-step Pentasource sourcing methodology helps to assure that all barriers will be overcome and the appropriate supplier will be selected. A continuous improvement process helps you review, evaluate and enhance the working relationship going forward.
3. Will sourcing help manufacturing costs to continue declining over time?
Even though Pentasource works extremely hard to establish long-term supplier relationships, market forces require that we monitor performance and take advantage of every cost saving opportunity available. This is just one part of our commitment to continuous improvement.
4. How are rising labor and material costs impacting global sourcing?
Increasing costs of fuel and raw materials are fueling inflation for all major economies, including the U.S. and China. Quality output can only be maintained when good working relationships and local oversight of labor and material costs by your sourcing partner are in place.
5. What insurance and risk management issues are associated with global sourcing?
Product liability, safety and loss control and claims management factors are really no different than those impacting manufacturers here in the U.S. Pentasource will, however, help you ask the right questions of your current insurance providers so that any required coverage, such as cargo and ocean marine, travel, international medical or expatriate programs are in place.
6. What government regulations impact a global sourcing arrangement?
While product design requirements are always a concern, a successful global supply chain will always be subject to freight issues, politics, currency exchange rates and emerging technologies. Customs clearance can require some complex coordination as well.
7. How do we make sure we receive the service we need after the sale?
Our commitment to your organization does not end when an alliance partner is selected. Rather, Pentasource meets the long term strategic initiatives of its clients by finding the people and facilities best suited to their needs and then staying involved to monitor the continuous improvement process.
8. How do we manage freight costs?
Freight costs can be leveraged through volume just like manufacturing costs. Pentasource helps clients negotiate freight charges from a position of strength using volume and long standing relationships in the shipping and transportation industry.
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