Exam 10: Global Sourcing

Many of the exclusively foreign costs are established by ___________ and are very difficult to avoid.

___________ inventory issues will always occur when a third party (the shipper) is involved. The problems become pronounced when offshore sourcing is used.

When the dollar has a weak performance over the life of a contract, a firm can realize savings through the exchange rates.

The focus has been on a single aspect of outsourcing: the __________ of jobs, and, in particular, the outsourcing of ___________ jobs.

The major problems when doing business in China are the language barrier, business practices, and a fluid and diverse legal system. A well-specified _______________ is a basic requirement when buying from China.

Germany's GNP stands at $825 billion. Their monetary unit is the Real. Typical trading partners include the United States, the U.K., and other countries in the EU. Exports include machinery, motor vehicles, chemicals, iron, and steel products. The United States received $73.3 billion in imports from Germany in 2004.

One of the most important variables to consider is the exchange rate of currencies. Since predicting the fluctuation in currency markets is relatively easy, foreign purchases may actually cost less than negotiated depending on the length of the contract.

epending on the performance and strength of the dollar, goods can cost American firms different amounts from what's expected.

few countries, notably ______________, are often targeted as the ones that are displacing American workers by offering cheap labor.

The buying professional who is considering offshore sourcing must be prepared to fully analyze both the _______________ factors.

third problem companies face in global sourcing is ___________. Many times there are delays and confusion in translations.

If a buying firm is to be effective with an offshore sourcing strategy, it must either hire experts or develop specialists that are assigned to offshore suppliers. Ideally, these individuals must have experience in purchasing management, quality control, and basic accounting. This cost also must be considered in the evaluation process.

The French GNP is $542 billion. Their monetary unit is the Frank. Typical trading partners are the other EU members, the United States, and Africa. Exports include machinery, transportation equipment, and food. The United States received $28.5 billion in imports in 2004 from France. French exports to the United States increased 56.9 percent from the previous year. This trend is not expected to change because of the cheaper U.S. dollar and the strong French demand.

irect labor and materials costs, lead-time costs, transportation costs, and inventory costs are a part of both domestic and offshore sourcing. _________________ tend to be higher when sourcing globally.

____________ is a form of agreement that involves the purchaser being given a share in the manufacture of a foreign designed product.

_____________ is when a prime contractor substitutes an existing supplier with one located in the buying country.

ue to technical expertise, German negotiators are extremely cautious. The opponent should be well prepared on technical details.

ny business or individual wanting to import goods into the United States will have to work with the Export Administration (EA) of the U.S. Department of Commerce. Several steps that (a company needs) to be aware of are the following:etermine whether the item (s) in question is subject to the exclusive jurisdiction of a State agency.etermine if the technology or software is privately available.or an item in a foreign country, the cost of the item must be determined.or items made in a foreign country, determine whether it is a decontrolled item in the US.etermine whether the foreign made item is subject to selective prohibition.

ommunication can be described as the _______ that holds together a sourcing relationship.

The United Kingdom's GNP is $490 billion. Their monetary unit is the Crown Royal. Typical trading partners include the United States, Germany, and other countries in the European Union (EU). Exports include machinery, transportation equipment, petroleum, and other manufactured goods.