We receive a lot of inbound calls asking for low cost country sourcing help. The requests have one similarity this year. Everyone wants out of China. The calls go as follows: We have been manufacturing our product in China for 5+ years and costs are rising. We want to investigate other low cost countries that may be more competitive. Sometimes the calls focus on reduced risk - we don't want to have all of our eggs in one basket and we don't have the resources to investigate other potential countries ourselves.

Rising labor costs, falling dollar, earthquakes, intellectual property violations, Olympic Games commerce disruptions etc. are making companies re-evaluate the China risk / reward scenario. Companies want to know where to go to remain competitive and to reduce single country sourcing risk. It is easy to identify potential candidates - Vietnam, South Korea, Taiwan, Malaysia, Eastern Europe, Africa, South America ....... Which countries are right for you?

The low cost country selection process starts with the product that you are trying to produce. Are the raw materials available? Can you find a reliable supplier with the capability to meet your specifications? Are certifications needed? Are there export / import restrictions? There are many more issues that need to be investigated just to short list a supplier before beginning sample production. Many companies are looking at the in country market for their product as one way to mitigate some of the risk.

It is helpful to have in country experts that can help you to navigate the local legal, political, cultural and logistic landscape. At Source One, we have built a global network of in country partners that can ease the difficulties associated with supplier identification and qualification. After review of your requirements, we can help identify the best low cost countries to target for alternate sources of supply. With the rapid shifts in global markets, you don't have to do all of the heavy lifting.
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Steve Belli

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