BLOG

Is Low Cost Country Sourcing the Best Option to Increase Economic Footprint

Jun 10, 2019

The recent contraction in the global economy has made it imperative for companies to become strategic players in the global market. This requires them to look for ways to maintain their competitiveness apart from implementing new and innovative technologies. Pursuing low cost country sourcing is one such way through which companies can sustain competition and capitalize on growing opportunities.

Low cost country sourcing has gained popularity over time and is now considered to be an alternative for companies to remain competitive and create more value for their customers. Although it was more a reactive approach designed to reduce production costs, low cost country sourcing is now considered to be a proactive strategy to pursue sustainable competitive advantages. In this blog, procurement experts at SpendEdge discuss the key benefits of low cost country sourcing and procurement and the strategies companies can devise to mitigate risks occurring while sourcing in low cost regions.

Deciding on low cost region requires a comprehensive understanding of different social, economic, and political factors. Request a free demo to know how our experts can help you gain real-time procurement insights.

Request Free Demo

What are the Benefits of  Low-Cost Country Sourcing?

Cost Effectiveness        

While companies have reaped numerous benefits by pursuing low cost country sourcing, the increasing pressure to reduce costs holds the top priority. The cost of skilled and unskilled manpower in western countries is much higher when compared to markets in emerging economies. The benefits of low country sourcing go much beyond labor arbitrages and helps reduce manufacturing and production costs.

Economic Footprint

The changing economic scenario in low cost countries has come with reduced premium tariffs, promoting the expansion of businesses in developing regions. Improvements in technological infrastructure have further diversified the economic footprint, resulting in the sourcing of goods and services from low cost regions.

Wondering how you can leverage the benefits of low cost country sourcing to gain competitive edge in the market? Request a free proposal and access our complete portfolio of low cost country sourcing solutions.

Request Free Proposal

Low Cost Country Sourcing Strategies to Mitigate Risks

Low Cost Country Sourcing Strategy  to Mitigate Regional & Cultural Risks 

Often companies tend to overlook risks originating from low cost countries offering the products/ services of interest. The volatile economies do not have strict governmental rules and regulations causing internal instability and impacting the business growth. Moreover, the cultural differences and language barriers prevailing in different nations play a decisive role in the success of any business. To ensure growth in such a situation, it is critical for businesses to understand the relevant issues present in the low cost country regions and have strategies to address those risks/ situations.

Low Cost Country Sourcing Strategy  to Mitigate Regulatory Risks

For any low cost country sourcing initiative, it is imperative to understand regulatory frameworks and their possible impact on the business. There may be regulations or tariffs that can limit the production of products. Also, multilateral trade policies and relationships must also be taken into consideration before deciding low cost region. This will identify hidden costs such as quality and increased lead times occurring due to lack of local standards control. The better understanding and knowledge of International trade regulations and agreements signed between the two countries will help countries to mitigate all such risks. To gain detailed insights into the regulatory norms, request more information here!

Low Cost Country Sourcing Strategy  to Mitigate Risks in the Production Process 

While quality control mechanisms have improved over time through the ISO system, the quality assurance process still has a lot to improve in emerging markets. Companies need to evaluate the complete production process and ensure that the right terminology is considered for any sourcing initiative. By completely understanding the standards and conducting audit process,  any inconsistencies in the production process or the suppliers involved in it can be effectively managed.

Getting Down To Business

We are offering Free Trials to all our customers or prospects who have been impacted positively or negatively by Covid-19 and are looking to connect with prospect buyers immediately.

Contact us

Sourcing and Procurement Market Intelligence Services

Products and Tools

Featured

Services Overview

Category Market Intelligence

Supply Market Analysis

Low-Cost/Best-Cost Country Sourcing

Benchmarking

Spend Analysis

Cost Modeling and Should-Cost Analysis

Total Cost of Ownership (TCO) Analysis

Supplier Risk Analysis

Supply Chain Risk Assessment

Supplier Sustainability Assessment

Commodity Price Forecasting

Category Management

Supplier Negotiations

Contract Management

Procurement Store

Purchase Ready-to-use Reports

SEinsightsTM

Our Robust Procurement Platform

BizVibeTM

Suppliers and Buyers Marketplace

SUPPLY MARKET ANALYSIS FOR A METAL MANUFACTURING COMPANY HELPS ACHIEVE ANNUAL SAVINGS OF $15 MILLION

Industries

Industries Overview

Automotive and Tire

Banking, Financial Services and Insurance

Biotechnology, Pharmaceutical and Life Sciences

Chemicals

Energy

Food and Beverage

Industrial and Manufacturing

ICT, Media and Entertainment

Mining, Metals and Minerals

Retail and CPG

Transportation

INCREASING LOCAL PROCUREMENT BY 28% FOR A COMPANY IN THE METALS AND MINING INDUSTRY – A CASE STUDY BY SPENDEDGE

Resources

Featured

Resources Overview

COVID-19 Resources

Blogs

Case Studies

Whitepapers

Webinars

Press Releases and Media Mentions

5 KEY CORONAVIRUS RISK ASSESSMENT STRATEGIES TO OVERCOME HEALTHCARE SUPPLY CHAIN CHALLENGES

IDENTIFYING STRATEGIC PURCHASING PRACTICES FOR A COMPANY IN THE US FOOD SERVICE INDUSTRY | SPENDEDGE’S LATEST SUCCESS STORY

COVID-19

Featured

Overview

Buyers

Diagnostic Test Kit

Additional Resources
Contact

A LOOK INTO THE FUTURE OF THE FOOD AND BEVERAGE INDUSTRY AFTER THE COVID-19 PANDEMIC

Identifying the Top 100 Coronavirus (COVID-19) Test Kit Manufacturers Across Regions

Clients

Featured

Clients Overview

Who We Serve

Case Studies

SUPPLY CHAIN MANAGEMENT HELPS AN IMPORT AND EXPORT INDUSTRY CLIENT ENHANCE SUPPLY CHAIN VISIBILITY

REALIZING SAVINGS OF $15 MILLION IN PACKAGING SPEND FOR AN FMCG CLIENT – PACKAGING SOURCING STRATEGY

About Us

News

About SpendEdge
Why SpendEdge?
Vision, Mission and Values
Clients
Social Impact
Global Offices

Press Releases and Media Mentions

Upcoming Events & Webinars
Request Free Proposal