Sourcing Strategies of Manufacturing Firms: Transaction Cost Implications
Developing the right sourcing strategy in managing the firmÕs supplies is critical for todayÕs managers. They realize the long-term impact of their sourcing strategies (make or buy, supply-base structure, and nature of customer-supplier relationship) on the profits and the efficient functioning of the organization. The study examines and evaluates changes in these strategic choices. The study revealed the following: small and lower labor productivity firms rate their internal suppliers better than external suppliers; obtaining supplies nationwide from a limited number of suppliers is the prevalent supply-base structure; and customersupplier relationship is deepening.
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Volume (Year): 16 (2001)
Issue (Month): 2 ()
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- Coase, R H, 1992.
"The Institutional Structure of Production,"
American Economic Review,
American Economic Association, vol. 82(4), pages 713-19, September.
- Demsetz, Harold, 1988. "The Theory of the Firm Revisited," Journal of Law, Economics and Organization, Oxford University Press, vol. 4(1), pages 141-61, Spring.
- Hong Y Park, 2000. "Foreign direct investment and global sourcing choices of firms in the US," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 21(6), pages 211-221.
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