Top 5 Signs You Need a Sourcing Partner
Choosing to purchase globally can be a daunting task. It is not something you can just dip your toe in to see how it feels. It requires a total shift in your company’s mind set. You have to jump in with both feet and be prepared to swim as soon as you hit the water.
Consequently there are two major reasons why companies fail at their sourcing attempts:
- They perceive it to be an easy process because the availability and volume of manufactures found online.
- They are simply not prepared to put in the investment of capital, time and energy it can take to effectively develop their global supply chain and ensure that they receive a quality product.
Sourcing from overseas is a big decision that requires extensive preparation and expertise to realize the full potential. This is why it’s best to find a sourcing firm to partner with. A partner that you can trust and who you know has the experience and knowledge to help you succeed.
Below are our top 5 signs you need help you with your offshore purchases:
- Your previous efforts to source products have failed – If you have failed at your previous attempts then you know how hard it is to develop a reliable supplier. By aligning with a sourcing firm you will be able to tap into all their resources including: multiple supplier options, total project management, quality control, language support and logistics, etc. Essentially the sourcing firm becomes an extension of your organization and supports you 100 percent of the way from purchase order to delivery.
- You are in need of costs savings to “stay in the game” but don’t know how to get them – Yes, cost savings can come from overseas but if that’s all you’re focused on, you will not be successful. Bottom line, cost savings only exist if you receive a quality product. By working with an established sourcing firm you’ll be able to benefit right away from the years of development work the firm has put in with their manufacturing partners. That means realizing the cost savings you’re seeking quicker and consistently receiving a quality product.
- You have annual sales of $5-50 million – In today’s business environment it’s not a question of if your company will source product from overseas but when. Especially if you have annual sales in the 5-50 million dollar range. This is the sweet spot to work with a sourcing firm because our experience tells us that companies below this threshold do not have the capacity or capital required to be successful. And if your company is over $50 million in sales, then you’ll likely have the resources in house to source for yourself.
- You want a customized or highly technical product – Most small to mid-sized business are consistently looking for a way to differentiate themselves from their competition. Product development is a great avenue to set your company apart. And as long as you align with the right sourcing firm, product development doesn’t have to be an expensive proposition. Minimal fees are to be expected but depending on the size and scale of the opportunity some firms may be willing to share in the development cost so long as both companies can benefit on the back end once the product is developed.
- You don’t want to assume all the risk of offshore purchasing yourself – It’s no secret there are a litany of risks your company has to assume when sourcing from overseas – including: financial, communication, quality, logistics, etc. Quality sourcing partners manage your risks, so you can stop worrying about your purchases and focus on your most important asset – your customers.
Source: GCP Industrial Products Blog
