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Questions and Answers
Which factor is associated specifically with sourcing from a re-shore or nearshore location?
Which of the following factors would be least favorable for choosing an offshore sourcing location?
What is a primary characteristic that would lead a company to choose offshore sourcing?
When considering sourcing locations, which scenario would likely favor re-shore or nearshore over offshore?
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Which of the following is NOT a characteristic of offshore sourcing locations?
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What key factor indicates a scenario that favors choosing re-shore or nearshore sourcing?
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In the context of sourcing locations, what is a characteristic typical of offshore sourcing?
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Which factor would likely create a barrier to choosing re-shore or nearshore sourcing?
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Which scenario would most likely lead a company to prefer offshore sourcing?
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What trade-off factor would be critical in deciding between offshore and re-shore or nearshore sourcing?
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Study Notes
Sourcing Location Criteria
- Re-shoring or Nearshoring is preferable when shipping costs are high in relation to the value of the product.
- Re-shoring or Nearshoring is recommended when dealing with products that have high product variety, fluctuating forecasts, or safety concerns.
- Offshore is a preferable option when shipping costs are low compared to the product's value.
- Offshore is advantageous when dealing with standard products with stable forecasts and labor-intensive manufacturing processes.
- Offshore is an ideal choice when competing on price while the product is price-sensitive.
- When deciding between re-shoring/nearshoring and offshoring, the factors listed above should be considered, as they significantly influence the optimal sourcing location.
Sourcing Location Criteria
- Re-shoring/Nearshoring is optimal for products with high shipping costs relative to their value, high product variety, unstable forecasts, safety concerns, and premium pricing.
- Offshoring is favored for products with low shipping costs compared to their value, standardized designs, stable production forecasts, labor-intensive manufacturing, and competitive pricing strategies.
- The decision to re-shore, near-shore, or offshore ultimately depends on a balance of these factors, making it a "seesaw" of considerations for each specific product or scenario.
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Description
Test your understanding of sourcing location criteria, including the distinctions between re-shoring, nearshoring, and offshoring. This quiz covers key factors such as shipping costs, product variety, and price sensitivity that influence sourcing decisions. Assess your knowledge and make informed decisions in supply chain management.
