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GLOBAL SOURCING CONS (PRONS OF SOURCING LOCALLY :red_flag: (PR Can…

- - - - Communications are Difficult
        
        Language Barrier
        
        Cultural Differences
        
        Time Differences
      - Harder to Build Trustworthy Relationship over Long Distance
      - With Local Sourcing -> Easier to Build Long-Term Sustainable Relationships
      - Managers Being Reluctant to Travel to the Exporter Country
        
        Especially if it is Dangerous. For Instance to Pakistan or Egypt
    - - Maintaining & Measuring Quality is Hard
      - Harder to 'Remake' -> if made Poorly
      - Out-of-Stock Problem
      - Could put Companies Reputation in Risk
  - - - Completely Destroyed
        
        A Container Ship MOL Comfort in 2013 split in half. All the containers drowned
  - - - Protectionism Policies
        
        Quotas
        
        Tariffs
        
        Embargo
        
        Currently Protectionism is a General Trend
        
        Trumps 'Re-Shorring' Polices
      - Transport Policies
      - Product Storage Policies
- - - - Transporting
      - Staff Travel Costs to Check the Quality and Negotiate
      - Inventory Carrying Cost
        
        Cost of carrying inventory = average inventory value x opportunity cost of capital
      - Longer Lead Times
        
        Would Have to Increase the Speed at Which Product Development Team gets Through the First 5 Stages of Buying Cycle
        
        Out-of-Stock Problem
      - (FOR ONLINE) Possibly have to Possess a Warehouse to Store the Imported Goods before Selling
        
        If Domestically Importing can mail the goods directly to consumers