Distance Sourcing (“Where Make?”)

When considering sourcing from low cost economies, careful and detailed analysis is required before deciding whether a category of spend is suitable. To assist in the decision making process, Vendigital has developed a unique tool which identifies if a spend category is appropriate for long distance, medium distance or even local sourcing.

The Distance Sourcing Analysis tool considers the three main characteristics of a spend category which have a direct impact on its suitability for long distance sourcing i.e. Logistics, Manufacturing Requirements, Design & Development and Transferability. Each of these category characteristics is divided into a further four sub-sections in order to specifically show what makes a spend category suitable for long distance sourcing or what might present a problem.

Detailed data for each spend category is entered through an easy to use interface and the analysis tool produces graphical and numerical reports on each category's optimum distance sourcing position against each characteristic and sub-section. The level of deviation in each area leads to a recommendation to source from long distance, middle distance (for example Eastern Europe for a UK company), nationally or locally.