What is the sourcing
"Sourcing" is a word used in the business world to indicate the fact to find suppliers. It describe the act which aims to reduce the overall cost of purchases. The term "to source" is used to denote the action of search, search, tracking and evaluation of a supplier to meet an identified need (in term of goods or service) made by a company.
Sourcing is to let another company other than yours to handle the purchasing part in another country and all the resulting activities (price negotiation, monitoring and quality control, logistic, transportation and clearance).
Benefits of sourcing:
⇒ Identify and develop new suppliers abroad.
⇒ Expanding the suppliers panel.
⇒ Increase competition in the existing suppliers panel.
⇒ Continuous comparison of price and quality in the world market.
⇒ Destruction or prevention of monopolies.
⇒ Discovery of innovations made by new suppliers.