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MAKE OR BUY (Subcontracting (Can exist only when there are prime…
MAKE OR BUY
Subcontracting 
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Payments is usually negotiated along with the actual pricing and terms and conditions of the subcontract.
Cost-control begins with the negotiation of a fair and reasonable cost proper choice of the contract type & imposed incentives.
Outsourcing
Purchase and activity, product or service previously made in-house
Why buy?
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Environmental
Sometimes companies create disposal issues in a particular location.
Most common:
Janitorial service
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Information systems.
Growth area:
Transportation deregulation
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Reduction in inventories
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Insourcing
In-house activity,product or service
previously purchased outside
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Most obvious reason is when an existing source of supply goes out of business or drops a product or service line and no other supply is available.
"The Gray zone"
Useful for testing and learning without having to make full commitment to make or buy,
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