Week 3 Sourcing and producing Flashcards
(36 cards)
lower cost and/or access to titems not available locally
absolute advantage
differences in the cost of producing products in different countries
comparative advantage
lift most tariff, quota, and fee/tax limitations on trade
Free trade agreements
are between 2 nations
Bilateral trade agreements
involve 3 or more nations
Regional trade agreements
establishes free trade among Canada, the United States, and Mexico
- goals involve making structural changes to operate a borderless logistics network in North America
USMCA
A FTA between the United States and South Korea
- steel manufacturers impacted most
KORUS
Considered the first ever FTA for the United States
US-Israel FTA
obtaining a good or service from an outside or foreign supplier
outsourcing
basing process or service overseas
offshoring
transfer to a newarby country
nearshoring
reintroducing domestic manufacturing
reshoring
aligning SC networks w/ political and economic allies
freindshoring
What percent of international trade into the United States passes thorugh seaport and airports
90%
- recognition of need
- description of need
- identification and analysis of possible sources of supply
- supplier selection and determination of terms
- preparation and placement of the purchase order
- follow up and/or expedite the order
- receipt and inspection of goods
- invoice clearing and payment
- maintenance of records and relationships
The supply process
a fromal document that a company sends to vendors or suppliers to gather information about their products, services, or qualifications
request for information
a formal document that a company or agency uses to solicit bids from potential suppliers for a product, service, or asset
request for proposal
a formal request for proposals from vendors fora. project or service
request for bid
is the amount of tax paid on an imported good
duty
the amount of duty that an importer has to pay is determined by 3 factors
- the type of goods (their CLASSIFICATION)
- the value of the goods (their VALUATION)
- the country from which the goods originated (the RULES OF ORIGIN)
the rate at which an import is taxed
tariff
(tariff rate is also called duty rate)
4 types of production tradeoffs
- volume vs. variety (soft drink industry)
- responsiveness vs. efficiency
- production costs vs. supply chain costs
- in house vs. outsource
What are the 2 economies when it comes down to volume vs. variety
- economies of scale
- economies of scope
- higher volume production with lower cost per unit of output
- suitable in situations where production process have high fixed costs and equipment
Is this economies of scale or scope?
economies of scale
