Among sourcing strategies, local sourcing and global sourcing are two ways for companies to purchase materials and products. Both methods have their advantages and disadvantages.
Today’s post helps you know the differences between them and you will know how to choose.
What does local sourcing mean?
Local sourcing is to obtain raw materials, parts, and finished products from manufacturers in your own country. Many startups and small companies always take this sourcing strategy.
For example, a New York coffee shop sources coffee beans from a coffee roaster in Hawaii. Because Hawaii is the only place in the USA where coffee is grown. Compared to other countries like Mexico, sourcing from the local country is more convenient and faster with less logistical risk.
When is local sourcing the best option?
There are lots of advantages of local sourcing. The main reasons you might want to consider local sourcing are listed as follows:
1. Lower MOQ
Local sourcing may have more flexible MOQs. Because you are more likely to meet local suppliers and easily communicate with them. If you have a good relationship with them, even if your order is small, they may be willing to work with you.
2. Fewer documents and procedures
Choosing local sourcing means that you don’t have to deal with all the complicated documents required for customs clearance and the whole sourcing process is much simpler.
3. Short shipping costs and sourcing time
Local sourcing reduces the cost and time of shipping. Your goods will have a shorter lead time, which means you’ll be able to launch products faster.
4. Greater control
In local sourcing, you can talk with your suppliers face-to-face and explain your needs in detail. You can also check on-site during production. You can easily control the quality of your product.
While domestic sourcing also has some challenges. For example, products in your country are more expensive, and local materials are limited. So many businesses tend to import products from international sourcing for these reasons.
What does global sourcing mean?
Global sourcing is the process of sourcing raw materials, parts, and finished products from international suppliers rather than from local or domestic sources. Larger companies prefer this sourcing strategy.
For example, a technology company based in the United States sources electronic components from Japan, assembles the products in China, and then distributes them globally. In this process, sourcing products from Japan is to ensure quality, while taking advantage of the lower labor costs in China for assembly is to save costs.
Why is global sourcing the preferred option?
Global sourcing nowadays is becoming more and more popular because of its many benefits:
Cost savings
It is the main reason why many importers choose global sourcing. In some countries like China and India with lower labor costs, product manufacturing costs tend to be cheaper than in other countries. You can buy goods from here to increase your profits by reducing production costs.
Better quality products
Different countries have their own advantages in certain products. For example, France is known for perfume, while Germany and Japan are known for high-quality cars and automotive components. This means that when you need to buy something, finding suppliers in the countries where the product is primarily produced is a wise choice. Because they are more specialized and the product prices are more competitive.
However, the process of global sourcing is not easy. You may face language barriers, cultural differences, and many other challenges. Then you need a sourcing agent to help you deal with those troublesome things, making your sourcing process easier and more efficient.
Jingsourcing is your one-stop global sourcing solution.
If you want to source from China, you can choose Jingsourcing as your sourcing agent. We have the following advantages:
One-stop service
We can deal with everything related to importing from China to your country on your behalf, including supplier selection, production follow-up, product quality control, shipment, customs clearance, etc. This can make your importation process smoother and more efficient, especially if you lack experience or want to find a professional team to manage your entire supply chain.
Supplier selection
The suppliers you spend a lot of time and effort to find are not the most suitable in many cases, and they can not provide the products that meet your requirements. If you work with us, whether you want to wholesale stock products or customize new products, we can find suppliers matching your requirements from dozens or even hundreds.
We will collect their samples and send them together to you. You can compare these selected suppliers and samples, and choose the most satisfactory one. It can simplify the difficulty of supplier selection.
Strict quality control
We provide general and full inspection services if you need. In addition, our inspection method is very flexible. According to your inspection requirements, we can check the product defects you are very concerned about instead of some small and insignificant flaws. For unqualified products, we will communicate with the factory on your behalf and ask them to re-produce or compensate you.
Multiple shipping options
Whether you want to ship by sea, air, road, or express, we can arrange it. We have many freight forwarders who can deliver on time and help you get more competitive prices. We also support a variety of shipping incoterms, such as FOB, CIF, DDP and DDU.
In addition, we can also help you handle the necessary documents for customs clearance such as bill of lading, packing list and other documents that may be required (e.g. fumigation certificates, MSDS). All these make shipping from China to your country much easier.
Lower MOQ than Alibaba
Many small and medium-sized businesses or e-commerce sellers are often rejected when directly purchasing from factories on Alibaba. This is because their orders are too small to meet the factory’s MOQ, and their products are complex to make. The factory may feel it’s troublesome and unwilling to take the order.
Many clients will find us to help them. On the one hand, our MOQ is small. Because we have many supplier resources with a good relationship, we can help you find one to take your order. On the other hand, we are professional in product customization. We will do our best to improve your product customization solutions, making it simple, feasible and cost-saving.
