Chapter 2 Flashcards
International distribution systems
Domestic manufacturing
Distribution and marketing take place abroad
International Suppliers
Raw materials and components supplied from abroad.
Domestic final assembly.
Final product sold locally or re-exported.
Offshore Manufacturing
Product(s) sourced and manufactured in a single foreign location.
Domestic warehousing, distribution and sales.
Fully integrated global supply.
Products supplied, manufactured and distributed from any location.
National boundaries used to maximise competitive advantage.
What is the transfer to a third party of the management and delivery of a process previously performed by the company itself?
Outsourcing
What can be defined as the transfer of specific processes to lower cost locations in other countries?
Offshoring
What are the 4 reasons to outsource?
Costs
Flexibility
Core Competency Focus
Technology
What are the 4 main types of global supply?
International Distribution Systems
International Suppliers
Offshore Manufacturing
Fully Integrated Global Supply
What are Product development, Purchasing, Production, Demand management and order fulfilment part of?
A global business strategy
What are the 4 forces driving globalisation?
Global market forces
Technological forces
Global cost forces
Political/Economical forces
Give some examples of global market forces
Foreign competition in local market.
Increase in foreign demand.
Existence of state-of-the-art markets (Japan, Germany, USA)
Give some examples of technological forces
Diffusion of knowledge.
Tech sharing and collaboration.
Global location of R&D facilities.
Labour costs and Incentives are what type of force?
Global cost force
Political/Economical forces include..
Exchange rate fluctuations.
Regional trade agreements (EU, NAFTA, ASEAN).
Trade protection mechanisms.
What is directional imbalance and why does it occur?
It is the mismatch in the flow of freight that occurs from freight being moved in one direction but then not in the opposite. (UK fruit)
