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LadyEllen -> RE: What's good about overseas outsourcing? (1/27/2008 1:25:51 PM)
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Some more issues I've come across in the last month or so - or had related to me at least; all to do with boring supply chain stuff, but still -
The first was from my parents this afternoon. They went out to buy some light fittings of a certain type - the one store had only one such fitting, the second store (same chain) couldnt supply at all - the next delivery apparently is on the 8th February, around two weeks from now. What this indicates is that the supply isnt from the UK, isnt even from Europe, but from a far away land. Result, two disappointed customers because the supply chain is far too long from this far away land.
At the same time, my parents picked up a new ceiling fan/lighting installation for my sister. There were two types that were suitable - the one for £80-00 and the other for £30-00. Both made in a far away land for pennies and shipped here for a few pennies more and retailed at a huge mark up. Conclusion - these imports are not exactly always cheap to buy, even if cheap to import. Someone is getting very rich.
And then there's one of my customers in the UK, a supplier of pallets and boxes and the like to the UK distribution and warehousing industry. Whilst we transport their imports from Italy, the level of orders has fallen off in recent years - simply because in order to compete in their market, my customer has to buy from the Far East to remain price competitive. Except that my customer never knows whats arriving and when from which factory where - and because the factories change so often they get huge problems because the overseas factories so often misinterpret the design specs theyve been sent. The result is that my customer has to have work done on the imports to put them right - letting down his own customers who have to wait for their orders in turn; not that they mind obviously, because on paper they "saved money" (though of course, it cost them more because of the delay). And the reason for this is that somewhat "interesting" means are used at the other end to decide which factory gets the order - whoever bribes who the most at the other end, at the time. The same "interesting" methods are used to decide the shipping company, which adds to the uncertainty of supply of course.
The results then, seem to be that whilst in b2b contracts all this outsourcing is a cheaper alternative, whilst in terms of b2c transactions this isnt necessarily being passed on, and there are accompanying problems in both timely delivery and accurate (quality) production in the supply chain for both b2b and b2c instances.
And dont even start me on the UK retail industry for home furnishings on all this!
E
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