On risk and cost in global sourcing
The benefits of global sourcing as part of a firm's purchasing strategy have been widely discussed in the academic literature, yet so there are few models that provide a comprehensive risk and cost assessment to guide managerial decision-making. In particular, few models capture the dynamic nature of many cost drivers, such as transportation and energy cost, labour cost inflation, or carbon offset costs, in their calculations. In this paper, we define three basic cost elements in global sourcing: static, dynamic and hidden cost, and use this framework to assess the costs and risks inherent in global sourcing scenarios from three different points of view: conceptually, analytically and empirically. We highlight the key learning points from each perspective and propose a total cost model of how to make informed global sourcing decisions, which we test by applying it to three exploratory case studies of global sourcing arrangements.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Weber, Charles A. & Current, John R. & Benton, W. C., 1991. "Vendor selection criteria and methods," European Journal of Operational Research, Elsevier, vol. 50(1), pages 2-18, January.
- Pol Antràs & Elhanan Helpman, 2003.
NBER Working Papers
10082, National Bureau of Economic Research, Inc.
- Pol Antras & Elhanan Helpman, 2003. "Global Sourcing," Harvard Institute of Economic Research Working Papers 2005, Harvard - Institute of Economic Research.
- Antras, Pol & Helpman, Elhanan, 2004. "Global Sourcing," Scholarly Articles 3196327, Harvard University Department of Economics.
- Antràs, Pol & Helpman, Elhanan, 2004. "Global Sourcing," CEPR Discussion Papers 4170, C.E.P.R. Discussion Papers.
- Edward Glaeser & Janet Kohlhase, 2003.
"Cities, regions and the decline of transport costs,"
Papers in Regional Science,
Springer, vol. 83(1), pages 197-228, October.
- Edward Glaeser & Janet Kohlhase, 2003. "Cities, regions and the decline of transport costs," Economics of Governance, Springer, vol. 83(1), pages 197-228, October.
- Edward L. Glaeser & Janet E. Kohlhase, 2003. "Cities, Regions and the Decline of Transport Costs," Harvard Institute of Economic Research Working Papers 2014, Harvard - Institute of Economic Research.
- Edward L. Glaeser & Janet E. Kohlhase, 2003. "Cities, Regions and the Decline of Transport Costs," NBER Working Papers 9886, National Bureau of Economic Research, Inc.
- Nassimbeni, Guido, 2006. "International sourcing: Empirical evidence from a sample of Italian firms," International Journal of Production Economics, Elsevier, vol. 103(2), pages 694-706, October.
- David L Levy, 1995. "International Sourcing and Supply Chain Stability," Journal of International Business Studies, Palgrave Macmillan, vol. 26(2), pages 343-360, June.
- Liu, Fuh-Hwa Franklin & Hai, Hui Lin, 2005. "The voting analytic hierarchy process method for selecting supplier," International Journal of Production Economics, Elsevier, vol. 97(3), pages 308-317, September.
- repec:hrv:faseco:4784029 is not listed on IDEAS
- Fink, Carsten & Mattoo, Aaditya & Neagu, Ileana Cristina, 2005.
"Assessing the impact of communication costs on international trade,"
Journal of International Economics,
Elsevier, vol. 67(2), pages 428-445, December.
- Fink, Carsten & Mattoo, Aaditya & Neagu, Ileana Cristina, 2002. "Assessing the impact of communication costs on international trade," Policy Research Working Paper Series 2929, The World Bank.
- Cavusgil, S. Tamer & Yaprak, Attila & Yeoh, Poh-Lin, 1993. "A decision-making framework for global sourcing," International Business Review, Elsevier, vol. 2(2), pages 143-156.
When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:131:y:2011:i:1:p:333-341. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.