Non-U.S. Sourcing Expected To Rise Further

Study anticipates 41 to 50 percent of all goods and materials to be purchased from sources outside U.S.

By 2010, the total amount companies spend on goods obtained from non-U.S. sources is expected to rise to 41 to 50 percent for all goods and materials, according to a recent study by CAPS Research.

In 2005, the amount was between 31 and 40 percent.

Longer lead times, supplier delivery and quality, supplier evaluation and the lack of qualified supply management personnel were cited by the study as key obstacles to effective global sourcing.

Robert M. Monczka, Ph.D., Robert J. Trent, Ph.D., and Kenneth J. Peterson, Ph.D., the authors of the study, list the following eight performance factors that companies should focus on if they plan to invest in global sourcing:

1. A defined global sourcing process
2. Centrally coordinated/centrally led decision making
3. Site-based control of operational activities
4. Information sharing with suppliers
5. Real-time communication tools
6. Availability of critical resources
7. Global sourcing and contracting systems
8. International purchasing office support

Improvement in only one or two of those eight factors may limit continuous performance factors, the study cautions.

The full study can be accessed by visiting

CAPS Research is a nonprofit research organization that provides research on strategic supply management knowledge and best practices. It is sponsored by the W.P. Carey School of Business at Arizona State University and the Institute for Supply Management.