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| Sourcing as an enterprise management strategy in the face of globalization and growing competition in Clothing & Apparel Industry |
 In the literal sense, Sourcing denotes utilisation of external resources. It occurs when the execution of tasks, functions and processes hitherto fulfilled in-house is commissioned to an external provider pecialising in a given area on the basis of long-term co-operation.
Five elements characterise strategic Sourcing
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A close link between Sourcing processes and the key success factors of a firm in an Industry.
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The transfer of ownership of a business function previously internalised, often including transfer of personnel and physical assets to the service provider.
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A global contract, longer and denser than a classical subcontracting agreement.
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A long-term commitment between the client and the service provider.
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A contractual definition of service levels and of each partner’s obligations.
Sourcing helps an enterprise concentrate on its strategic tasks and goals . the core activity. As a result of minimising expenses on activities that are necessary but unrelated to the firm’s basic functions and goals, the prime cost can be reduced.
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| Sourcing’s benefits |
The most often discussed advantages of sourcing are connected with improved financial Performance and various non-financial performance effects, such as a heightened focus on core Competencies.
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| Main sourcing advantages identified |
1. Reduced overheads and operational costs
2. Possibility of converting fixed costs into variable costs
3. Price competitiveness
4. Lower involvement (freezing) of capital
5. Improved cost control
6. Higher flexibility , the ability to meet fluctuations in demand
7. Easier and more economic access to the latest technologies
8. Improved quality
9. Possibility of concentrating on firm’s core business
10. Improvement of measurability of costs
11. Better control of internal departments
12. Availability of new service options, and reduced capital commitment
13. Access to external competencies
14. Acquisition of specialist expertise
15. The ability to spread commercial risk
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| Track Process and the Apparel Industry |
Track Process has already deployed successfully the Track Source solution to manufacturers of Knitted Garments in India. Our clients produce world class Knitted Garments like Golf Shirts and other Casual Wear and cater to major brands in the United States and Europe.
Track Source allows real time status of orders in progress during their complete lead period from the time of sample development, orders, production, quality check, shipment and delivery.
By doing so Track Source helps to reduce lead times, provides control over sourced products and enforces best practices in world wide commerce. |
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