Many contract manufacturing cost drivers vary per location while some cost drivers such as material cost might apply to a number of locations. For location dependent variables across the globe, an understanding of how a specific input may be used by contract manufacturers helps OEM executives to assess the factors going into the input.
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Outsourcing & Offshoring
EMS Global pricing drivers methodology
China v. India for your product manufacturing
In the Philippines, where the Chinese population is 3 percent, it also manages to control 70 percent of all business. Thailand’s population is 3 percent Chinese, and yet the Chinese control 60 percent of the trade. India does have limitations. It does no executive any good to have printed circuit boards or finished goods inventory in an Indian factory and be unable to reliably move inventory to, and beyond, air or seaport in a timely and efficient manner.
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When outsourcing is not the answer
As sometimes happens to executives who have not outsourced previously, however, Rita's management was struck by the amount of infrastructure that would have to be maintained in order to manage an outsourcing strategy effectively.
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