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Levels of China sourcing [Infographic]

by Etienne Charlier

The reality of sourcing in China is changing fast. The time when it was enough to find a reliable Chinese supplier to secure a strong advantage over competitors is over. Today, Chinese labor cost increases and the continuous move of Chinese suppliers toward increased added value, make it important for buyers to evaluate their sourcing strategy from time to time.

One of the existing useful frameworks is the “Level of China Sourcing”. The infographic below summarizes four levels of sourcing, based on its scope, commitment of the organization to it and the return that can be expected.

It is inspired by a framework developed by BCG (for example in ”Beating Your Competition on China Sourcing”). I have updated it using procurAsia’s practical experience in the field.

The main purpose of the framework is to evaluate whether your company can do more (and benefit more) from China sourcing. It is also to estimate whether the organization has the will and resources to move to the next sourcing level.

Etienne Charlier is the founder of procurAsia and assists companies in sourcing industrial equipment and parts from China.  He writes about sourcing trends and practical tips on his China Industrial Sourcing Blog. Etienne lives in Shanghai since 1995. You can contact him here.

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