Vietnam: Strategic Sourcing destination for Machinery & Equipment
Vietnam: Strategic Sourcing destination for Machinery & Equipment Read More »
The building blocks of Global Sourcing Strategy
You may have been thinking about Strategic Sourcing for some time. Reading about the benefits China Sourcing can bring to a company, but you’ve probably also read about some of the problems and frustrations people have come up against.
Whilst the benefits can be huge, and to not source from China can put you at a huge competitive disadvantage in some markets. It is also true that time zones, language barriers and business communication standards can be very different and challenging to navigate.
So how do you avoid the pitfalls and frustration and deliver all the benefits of Strategic Sourcing and Procurement ?
Delivering an effective Sourcing Strategy is dependent upon a range of factors which must be confirmed before any product is ordered.
9. Monitor production and quality control: Regularly communicate with your supplier during the production process to stay updated on the progress. Consider conducting factory visits or hiring a third-party inspection service to ensure quality control.
10. Manage shipping and delivery: Coordinate with your supplier regarding shipping arrangements, including choosing the appropriate shipping method (air, sea, or land) and handling customs clearance. Track your shipment to ensure timely delivery.
The opportunity to source from China is huge but also a lot of complexity and requires many new skill sets and knowledge
For many small start-ups, challenger brands or emerging high growth companies the skills sets and connections to deliver Strategic Sourcing projects are not readily available. Working on these 10 areas to ensure you are working with the right sourcing partner can be very time hungry.
However you can short cut this by engaging a Sourcing company to deliver all the benefits of China sourcing without the stress and time pressure. You need to find a Sourcing partner who shares your vision or business and can demonstrate
At ET2Cwe work with our clients to make their Global Sourcing simple. For over twenty years we have been working with our clients to deliver their sourcing strategies. Working with Multi National retailers to E-Commerce start ups.
Our offices in 7 countries and a team of over 250 colleagues ensure we are always on the ground in your market. Delivering independent and fully digitised QA reporting, Supplier contact.
If you would like to see how we might be able to deliver your strategic sourcing goals please get in touch contact@et2cint.com
How do I start Sourcing from China ? Read More »
Interchangeable words or unique, complementary activities that together can unlock superior business performance. As a smaller brand or business without a Procurement or buying team where do you start and do you need both ?
Sourcing and procurement are two related but distinct activities that are essential components of an overarching strategic supply chain management plan.
While sourcing and procurement are distinct activities, they are closely related and often overlap in practice. A strategic sourcing approach can help companies optimize their procurement activities by ensuring that they are working with the best suppliers and getting the best possible prices and terms. Procurement, in turn, is an important part of the sourcing process, as it involves executing contracts and managing supplier relationships to ensure that goods and services are delivered on time, at the right quality, and at the agreed-upon price.
Building a strong Sourcing Strategy and Executing the resultant Procurement Strategy can deliver a range of benefits
So where do you start creating your Sourcing Strategy ?
The key to creating, delivering, and benefitting from a strong Sourcing Strategy is to work with a partner who shares and understands your commercial ambitions. In addition, they should have:
Independent QA teams who can ensure your confidence in the delivery of your products both to specification and to time
At ET2C we have been working with our clients for over 21 years. Acting as our clients bridge to their Strategic Sourcing partners. Creating and delivering Strategic Sourcing plans, including independent on the ground QA.
Working with Start Ups and E-Commerce companies to accelerate their competitive advantage, delivering quality and compliance. We have over 250 colleagues based in seven countries to give you feet on the ground to ensure your Sourcing plans are delivered effectively.
If you have any questions or would like to explore how you could benefit from our experience please drop us a call at contact@et2cint.com
Sourcing and Procurement-What’s the difference ? Read More »
Global Sourcing Strategy, Asia Sourcing or China Sourcing are terms that are constantly being talked about and searched for online. How do we define them and what are the benefits to your business or brand? Are they purely the remit of huge organisations or can smaller companies derive all the benefits to grow their business?
As a small business or brand start up competition can be tough and relentless. What can immediately help to build your competitive advantage is an effective Sourcing Strategy.The creation and delivery of which can rapidly deliver bottom line benefits as well as superior quality and compliance controls. Building your business profitably and protecting your brand reputation. The cornerstone of your long-term growth.The era of globalisation is still with us, despite the continual turmoil from the Pandemic and the War in Ukraine. Whilst the last few years have been difficult for many the opportunities to build your competitive advantage are still there and as strong as ever.Indeed, in many markets not sourcing from China or Asia and put you at a potential disadvantage.So what should you expect a Sourcing Strategy to deliver to your business?
Overall, a global sourcing strategy can help companies increase competitiveness, reduce costs, and improve supply chain performance. However, it also requires careful planning, management, and coordination to ensure that the benefits are realised and the risks are managed effectively.
Potentially the most important decision to make is not whether to build a Strategic Sourcing plan but who to partner with to take those first steps into a new market. Where time zones, languages, communication expectations and ways of doing business maybe very different.
At ET2C we have been working with our clients for over 21 years. Working as our clients bridge to their Strategic Sourcing partners. Creating and delivering Strategic Sourcing plans.
Working with Start Ups and E-Commerce companies to accelerate their competitive advantage, delivering quality and compliance. We have over 250 colleagues based in seven countries to give you feet on the ground to ensure your Sourcing plans are delivered effectively.
If you have any questions or would like to explore how you could benefit from our experience, please drop us a message at contact@et2cint.com and see how we could help you build your Global Sourcing Strategy and deliver increased competitive advantage.
Why do I need a Global Sourcing Strategy ? Read More »
Strategic Sourcing plans should consider the opportunities offered by Turkey. As Sourcing and Procurement teams explore opportunities to shorten supply chains, look for alternative suppliers or find new fast growing potential markets to work with Turkey should be part of their thinking.
Many companies are already seeing the positive benefits Turkey can offer them as Turkey’s exports gain pace. Turkish Export growth has seen three consecutive months of year on year growth. As demand and supply sides build to support deliver to challenges fuelled by
What can Turkey offer Sourcing and Procurement teams ? Why should it be considered as a core part of any Global Sourcing Strategy.
Turkey as a strategic sourcing destination can deliver a range of structural and economic benefits making doing business smooth and seamless.
5. Trade agreements: Turkey has trade agreements with many countries, including the European Union, making it easier for buyers to source products and conduct business with Turkish manufacturers.
6. Ease of doing business: Turkey has made significant improvements in its business environment in recent years, including streamlining bureaucracy, reducing regulations, and improving the ease of doing business.
Turkey has a diverse range of exports but some of its biggest exports include:
1. Automotive parts: Turkey is a major producer of automotive parts, with exports worth over $20 billion in 2020. The country is home to several large automotive manufacturers and suppliers, and its high-quality parts are in demand worldwide.
2. Textiles: Turkey is one of the world’s leading textile producers and exporters, with exports worth over $10 billion in 2020. The country is known for its high-quality cotton and textile products, including clothing, fabrics, and home textiles.
3. Machinery: Turkey is a significant exporter of machinery and equipment, with exports worth over $9 billion in 2020. The country produces a range of machinery, including industrial equipment, agricultural machinery, and construction machinery.
4. Chemicals: Turkey is a major producer of chemicals, including petrochemicals, plastics, and pharmaceuticals, with exports worth over $8 billion in 2020. The country’s chemical industry is well-established and highly competitive.
5. Food products: Turkey is a major producer and exporter of food products, including fruits, vegetables, nuts, and processed foods. Exports of food products were worth over $7 billion in 2020.
Turkey’s biggest exports reflect the country’s diverse economy and its strengths in manufacturing, textiles, and agriculture. Alongside their traditional market strengths Turkey is fast building strong positions in several other markets.
1. Defense industry products: Turkey has seen significant growth in its defense industry exports, particularly in the Middle East and North Africa regions. The country’s defense exports have grown by over 20% annually in recent years, with total exports reaching $3.2 billion in 2020.
2. Electrical machinery and equipment: Turkey has seen strong growth in its exports of electrical machinery and equipment, which have grown by over 10% annually in recent years. Total exports in this category were worth $18 billion in 2020.
3. Medical devices: Turkey’s exports of medical devices have grown rapidly in recent years, driven by the country’s strong healthcare industry and growing demand for healthcare products. Exports of medical devices were worth $2.8 billion in 2020.
4. Iron and steel: Turkey is a major producer of iron and steel, and its exports in this category have grown by over 10% annually in recent years. Total exports of iron and steel were worth $14 billion in 2020.
5. Plastics: Turkey’s exports of plastics have also seen strong growth in recent years, driven by demand from Europe and the Middle East. Exports of plastics were worth $5.6 billion in 2020.
ET2C Is a global sourcing company with over twenty years’ experience working with our clients to deliver their Sourcing Strategies. Our offices in seven countries, including Izmir Turkey, ensure you always have a team on the ground to be your bridge to your Offshore suppliers.
Giving you independent feet on the ground and confidence with fast responses, removing time zone and language challenges.
If you would like to explore sourcing opportunities within Turkey or to discuss your future supply chain challenges.
Please contact us at contact@et2cint.com
Turkey: A Powerful Export Market for Global Sourcing and Strategic Sourcing plans Read More »
Strategic Sourcing from India, the high growth economy that should be in your Global Strategic Sourcing plan
With a population of over 1.2 billion, India is the World’s largest democracy, the second most populated country on the planet. It now boosts the World’s 5th Largest Economy WEF
Over the past decade, India’s integration into the Global Economy has been accompanied by similar levels of economic growth. Leading India to emerge as a Global Economic player and a country capable of playing a significant role in any product Sourcing Strategy.
“We believe India is set to surpass Japan and Germany to become the world’s third-largest economy by 2027 and will have the third-largest stock market by the end of this decade,” says Ridham Desai, Morgan Stanley’s Chief Equity
Building on their unique set of competitive advantages provided by:
The Regulatory environment has fuelled the delivery of six mega trends
1.Supply chain diversification
Fuelled by the global turmoil and moves by many companies to find alternative or additional sourcing partners to supplement China. India has benefitted from many companies in USA and Japan relocating supply chain partners to build future shock resilience.
Industrial components
Textiles
Electronics and EV technology
Manufacturing competitiveness in India has benefitted hugely from skilled work force and lower labour costs allowing highly competitive pricing position v other markets. India steel manufacturing also fuels the competitiveness of the manufacturing sector. The textiles & Apparel markets in addition to the cost and quality of labour India has easy access to high quality raw materials.
EV manufacturing and innovation and India’s ambition to be a Global Hub for EV industry and Technology. India will launch 40 models of EV car models from a range of Car brands. Support for the industry has been further supported by the recently announced the opening of the worlds largest EV hub supporting the manufacture of both vehicles and advanced cells.
3.Government initiatives
The Indian Government continues to strive to create the rights conditions for Export business to flourish. Foreign and domestic investment in manufacturing has increased supporting further output growth.
4.Capex
As many factories reach high levels of utilisation, benefitting from the strong growth in the Indian economy. Investment levels are rising rapidly both from Government and Private enterprise.
5.M&A
Manufacturing companies are using M&A as a way of building scale and adding capabilities to their portfolios and export capability. Deals were $108b in India in 2021 of which 16% were in the Manufacturing sector.
6.PE/VC funding
In the last few year significant investment has flown in India industrial and export sectors. Fuelling growth in the start up Eco System and building transformative growth. The Manufacturing sector benefitted from over 16% of this investment.
Summary Indian Export growth
Indian continues to build its position as a global export powerhouse. Strong infrastructure in pace, continued investment and Government commitment to creating to export growth helps to make India an easy country to do business in.
It has the second largest railway network in the world and a vast coastline with established seaports.
Strategically located nearly 10,000 KM closer to Europe and the USA.
For companies wrestling with the need to evolve their Sourcing Strategies. Starting to look at Off Shoring options or as part of a wider China +1 strategy India should be top of your list of countries to investigate.
Key export areas of
Industrial Components.
Textiles
Electronics particularly EV Technology
Can provide exceptionally high value and innovative products whilst retaining a lower-cost base.
ET2C Is a global sourcing company with over twenty years’ experience working with our clients to deliver their Sourcing Strategies. Our offices in seven countries ensure you always have a team on the ground to be your bridge to your Offshore suppliers. Giving you independent feet on the ground and confidence with fast responses, removing time zone and language challenges.
If you would like to explore sourcing opportunities within India or to discuss your future supply chain challenges.
Please contact us at contact@et2cint.com
Strategic Sourcing from India – The Growing Economic Powerhouse Read More »
Global Sourcing and Procurement functions are taking on a new enhanced mission within business. The immediate impact of which is to dramatically broaden their focus and accountabilities.
This fast rate of adaption and development of new responsibilities and challenges creates a need for New Skillsets, Data and Inputs.
For many teams who sit outside Global organisations this requires the rapid building of a New Eco System of partners to support the rapid delivery of new responsibilities. Building both the structure and systems to manage data but also the insight and decision-making skills required for analysis and action planning.
What some of the pressing agenda points for Chief Procurement Officers and Global Sourcing teams?
How can they keep on top of these big challenges as they rapidly evolve?
These 7 topic areas are increasingly important for companies and brands of all sizes to understand and review as part of their Global Sourcing Strategy. For many already stretched teams the need for skilled Partners to support their delivery of answer to these questions is crucial.
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Trending topics in Global Sourcing Read More »
5 reasons your business will benefit from a well-developed and executed Global Sourcing Strategy.
As the Canton fair opens for the 133rd time, bringing together business from across the globe. There is no better time to review and reflect on the need for a strong Global Sourcing strategy.As Sourcing and Procurement teams manage enhanced missions and a more elevated seat at the corporate table. Refining and delivering the Sourcing Strategy is even more important for corporate success.
Overall, a well-designed and executed strategic sourcing plan can help your company reduce costs, improve supplier relationships, increase efficiency, mitigate risk, and align procurement decisions with broader business goals.
Why you need a strong Global Sourcing Strategy for your business ? Read More »
Near Shoring Challenges as Globalised Trade Continues to Grow
The immediate rush and to change Sourcing Strategies, shorten supply routes and ‘Near Shore” is proving much tougher to achieve than anticipated for Sourcing
After the effects of the Global Pandemic, Ukraine War, US-China Trade conflicts and Inflationary pressures to name a few. There was a lot of talk about the need to shorten supply routes and Near or at least friendly shore sourcing.
The background to the rush to Near or Friendly shoring has been the nearly five years of open economic conflict between the US and China. US-China trade flows hit an all-time record of $690.6 billion in 2022. Connecting the countries by a larger movement of trade than any other Nations (without shared borders).
Suggesting that Globalisation is not showing signs of halting. DHL in their recent report suggest that the US-China trade relationship is beginning to show a “general pattern” of decoupling even as globalization more broadly remains resilient, according to DHL’s global connectedness index.
“International flows have proven remarkably resilient through recent crises, and they strongly rebut the notion that globalization has given way to deglobalization,” according to the report, produced with New York University’s Stern School of Business.
“Today’s threats to globalization, nonetheless, are real and demand serious attention,” it continued. “It would be a mistake to infer from the recent resilience of international flows that globalization cannot go into reverse.” What has been the real world experience of brands and companies looking to Near Shore as part of their Sourcing Strategy ?
US Apparel Companies Can’t See a Future Without China
Brands are finding few factories outside the country that can produce the quality and quantity they require.
When Lanny Smith founded Actively Black Inc. in 2020, he hired factories in China to produce the brand’s athletic wear. But last year, concerned about production delays caused by China’s Covid lockdowns, Smith explored buying elsewhere. He shipped samples to a supply chain agent who’d assured him there were alternatives in Latin America. “He hit me back the next day and said, ‘You’re not going to find anybody who can do this in the Western Hemisphere,’” says Smith, 38, a former basketball star at the University of Houston.
For many companies buying from China has become more challenging in recent years because of increased tariffs, snarled supply chains, factory shutdowns under Beijing’s Covid Zero policy and rising geopolitical tensions. Factors which have combined to make many Companies and brand owners investigate changing their Sourcing Strategy to be China +1 or to seek to replace China completely. Whilst on the face of it the idea has a lot of merit and upside finding suppliers who can match China for quality and price is not so simple.
Quitting China as a sourcing partner isn’t easy, and most progress has been concentrated in industries such as semiconductors that are considered vital to national security or have high added value. Producers of lower- tech, lower-margin and less added value products such as clothing, shoes, housewares and luggage are finding that few factories outside China have the machinery or the skilled workforce to deliver the quality and specifications required.
Since the 1990s, China has spent hundreds of billions of dollars transforming itself into the world’s premier location for manufacturing. Its factories have the machinery and expertise needed to produce quality products at a volume and pace that’s difficult to match. Along the 80-mile stretch from Shenzhen to Guangzhou, companies can weave, dye, sew, trim, label and package anything from T-shirts to tuxedos. And China’s investment in highways, railroads, air hubs and seaports has created a smooth path from factory gate to consumers worldwide.
Twenty years of Global Trading growth between China and the World is not something that can be dismantled quickly and easily. China’s advantages as a sourcing destination are so great that many companies that have tried to move away have returned at least a portion of their production there. Even moving away from the Chinese mainland cannot guarantee moving away from China. As China has expanded its influence, support for infrastructure and factory investment to other countries such as Ethiopia.
When companies move manufacturing out of China, they often end up working with Chinese- owned suppliers or sourcing components and materials from the country.
Summary
Sourcing strategies are not always quick and easy to implement, the initial idea to relocate manufacturing from China to other Asian or African markets can suggest instant benefits. China’s experience of supplying and shipping products around the World is difficult to replicate. For some markets this may well require more product side compromises to deliver the geographic move.
ET2C Is a global sourcing company with over twenty years’ experience working with our clients to deliver their sourcing strategies. Our offices in seven countries ensure you always have a team on the ground to be your bridge to your Off Shore suppliers.
If you would like to explore Sourcing Strategy options or opportunities within China or in addition to China or to discuss your future challenges.
Please contact us at contact@et2cint.com
Is Near Shoring still a good option for Sourcing Strategies as Globalised Trade Grows Read More »