Today, when it comes to choosing a supply chain, many wholesalers are opting for global toy sourcing rather than local sourcing. In fact, both global sourcing and local sourcing have their own advantages and disadvantages. Supply chain leaders should not only incorporate trade conflicts, tariffs and embargoes into their global sourcing plans, but also develop appropriate sourcing strategies that are flexible between global and local sourcing to ensure a stable supply and reduce the cost of logistics and raw materials.
Here we will compare global toy sourcing with local toy sourcing, aiming to help supply chain leaders make sourcing strategies better.
What is Global Toy Sourcing?
Global toy sourcing is one of the most important responsibilities of supply chain management. If you want a global supply chain, you have to work with it. This is different from international procurement, which is the purchasing and management of a global supply chain between two countries. For example, if a car manufacturer in Michigan buys floor mats from Canada and the rest of the parts are made domestically, this is an international supply chain. Global sourcing, on the other hand, is a complex supply chain from a global perspective. An automobile company buys brakes from China, engine parts from Japan, and some parts from Mexico.
For companies to make money successfully, it is important to expand their business in multiple countries. Global toy sourcing is critical to supply chain management as it enables companies to increase operational efficiency, achieve healthy margins, generate higher returns, and invest in expansion. We need to recognize that supply can be both short – and long-term. Purchasing activities are determined by the value of the entire supply chain (not just a single price). Supply chain managers need to consider several variables in order to determine procurement procedures worldwide.
When developing a global toy sourcing strategy, the company’s risk factors, operational needs, and sales goals must be taken into account. To solve complex business problems, modern technology is needed. Today’s supply chain managers cannot simply use spreadsheets to build and maintain global supply chains. Innovative global toy sourcing methods are being developed by making full use of cutting-edge technologies such as artificial intelligence (AI) and big data.
Pros and Cons of Global Toy Sourcing
The biggest benefit of global toy sourcing is cost savings. International procurement allows many overseas manufacturers to offer their services at very competitive prices, especially in regions where products are usually produced at low cost. With lower production costs, you can buy large quantities of goods at lower prices, which is ideal for startups and companies with limited budgets.
In the global supply chain, we find that low cost is only one of the many benefits of international sourcing. Let’s take a look at the additional benefits of toy sourcing products from overseas manufacturers.
Pros of Global Toy Sourcing
1. You can get a wider range of products than dosmetically.
2. Get unique, hard-to-find products that can attract more customers.
3. With access to suppliers all over the world, you have more choice than in your country.
4. Foreign suppliers are often active in dealing with small companies and producing small lots.
5. By using multiple suppliers in different parts of the world and in different regions, we can increase overall supply capacity and protect against supply chain problems caused by natural disasters.
6. You can acquire resources, materials, and technologies that are not available in your country, such as the ability to manufacture certain products.
7. Overseas procurement is also a place of learning that provides a foothold for developing new markets overseas.
In many cases, overseas manufacturers are able to significantly reduce costs compared with domestic procurement.
The benefits are great, but everything has its advantages and disadvantages, and this applies to global sourcing. Here, we introduce some common pitfalls in overseas procurement.
Cons of Global Toy Sourcing
1. You may encounter different industrial and technical standards, which may or may not be the requirements of the country of origin.
2. Both imports and exports may be subject to restrictions such as quotas and tariffs.
3. Documentation requirements for cross-border processes can be time-consuming and complex.
4. The exchange rate fluctuates.
5. Long transport time.
What Do You Need to Know about Importing Global Components into Your Supply Chain?
Large organisations are diversifying and improving their supply processes beyond local suppliers to meet the growing demand from e-commerce and consumer spending trends. The global supply of raw materials and products is an absolute priority to facilitate the growth of supply. However, this approach presents specific risks.
A second supply relationship can be used to meet demand when trade barriers increase in a country or a natural disaster destroys a supplier’s activities. The management of the global supply chain shall ensure that production and deliveries are timely and respected. Supply chain managers can better assess these global supply risks using some of the information contained in the whitepaper epic global supply chain risk assessment of the global supply chain institution. The document provides a reference framework for the assessment of countries on the basis of economic, political, infrastructure and knowledge criteria (epics). The document helps supply-chain managers to gather information about the risks in ten global regions and create an sourcing plan that maximises the benefits of global sourcing and minimises the risks.
Global supply chains can also help to strengthen trade relations between countries that exchange large quantities of raw materials. If a country is highly dependent on international trade, its trade elements can provide useful pressure for political change, which can lead to trade bans. Cross-border supply chains are one of many reasons why governments want to maintain good relations, minimize tensions, and raise taxes.
The supply of products worldwide also allows supply professionals to obtain the highest quality raw materials at the lowest price, while maintaining optimal operational efficiency. As a result, they can most effectively increase the overall value of the holding. Global supply chain management can harness local talent and facilitate innovation and product delivery. Buying goods from around the world gives you a cost advantage over your competitors. Global supply methods can give your company a competitive advantage. Global supply chains improve people’s incomes in low-wage countries by employing workers from international trading partners.
Trends in Global Supply Chain Sourcing
Covid-19 will be a key motivator for supply chain management reforms around the world. The persistent risks posed by COVID-19 are addressed with an emphasis on improving monitoring and mitigation capabilities. Some countries have proven to be in good health, while others have partially or completely stopped over time and experienced major disturbances.
The pandemic caused widespread transport disruption. Academics at the global supply chain institute at the university of Tennessee at Knoxville’s haslam school of business assess current risks in the supply chain and prepare for some disruption in the near future. Advising chain managers. We are moving to a more flexible supply chain that can easily meet new supply chain challenges. The procurement function plays an important role here.
Another notable supply chain trend is the ongoing focus on environmentally friendly supply chains that minimize the impact of raw materials and processed materials. In addition, in order to support local communities where global procurement activities have been neglected, companies are increasingly emphasizing procurement diversity. Tomorrow leaders, from the point of view of human and ecological, ethical are sourced from the top of the procurement strategy the need.
The last point is not so much a trend as a welcome fact that we are beginning to recognize just how important supply chains and procurement are as an industry. Today’s global supply chain management challenges highlight the importance of sourcing teams.
When looking for suppliers and manufacturers, you can choose local subsidiaries and global companies. Both have advantages and disadvantages. To help you understand the key differences between the two, we’ll explain why you should choose a local company rather than a global supply chain.
What is Local Toy Sourcing?
Local toy sourcing is the purchase of products and materials from local producers. Instead of relying on overseas suppliers, they choose to buy from local producers.
If you buy it locally, it is often expensive. Choosing to invest in local producers can cost you more than international investments. However, in some cases it is easier and faster to procure from a local manufacturer. If you need a short delivery time, it may make sense to buy from a local supplier who can produce the product and deliver it within a certain period of time, rather than worrying about the shipping time.
Pros and Cons of Local Toy Sourcing
Finding local suppliers will save your business time and money. Here are the main reasons why you should consider sourcing locally rather than from overseas manufacturers.
Pros of Local Toy Sourcing
1. Local toy sourcing is great for PR as it can show you are investing in your community.
2. For local suppliers, they can benefit from giving back and being proud of themselves.
3. With local sourcing, you can go to your suppliers for development, management and site visits, so you can see exactly what you’re paying for.
4. By regularly visiting suppliers and explaining their requirements in person, it becomes easier to purchase specific products from local suppliers.
5. The supply chain will be shorter and (if you’re lucky) the lead time will be more predictable.
Some argue that more companies should procure products and services from local producers to support local economies, but in reality this is not always the case. Each country has its own resources and know-how. In order to make business progress, it is important to procure products from quality and reliable producers, even overseas. If your country doesn’t have the skills to develop the products your business needs, trying to source locally will be at a disadvantage and you will run into problems along the way.
Cons of Local Toy Sourcing
While sourcing locally is great for public relations, here are some of the main reasons why sourcing overseas is better.
1. Close relationships with local suppliers can cause ethical problems in supplier selection.
2. If you decide to sign a contract with a local contractor, it may hurt local public opinion.
3. In your country, you may not find high quality products.
4. The economic impact of your country may affect your supply and supply chain.
5. There may be resistance to change, especially when you need something innovative and new.
6. The supplier you choose may depend on you as the main source of income.
For B2B Buyer: Union Vision Is Your One-stop Sourcing Choice
Union Vision is a professional wholesale toy manufacturer in China. We have more than 20 years of experience in product development, production, and exporting. We are focused on our customers’ needs and remain providing high level of service for customers. We are looking forward to working with you!