5 FM Sourcing

8/11/2019 5 FM Sourcing

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Sourcing

The process of procurement of products to meetcompanys marketing objectives is Sourcing

Determines where, when and how a companys products will be manufactured.

1Fashion Merchandising


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Sourcing

Merchandising and Sourcing share a

common goal - getting the right product to the

customer at the right price, right quantity and at

the right time and of right quality.



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Global Sourcing Global sourcing is a term used to describe practice of sourcing from theglobal market for goods and services across geopolitical boundaries.

Global sourcing often aims to exploit global efficiencies in the delivery of aproduct or service.

These efficiencies include

low cost skilled labour,low cost raw material andother economic factors like tax breaks and low trade tariffs.

Fashion Merchandising 3


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Global Sourcing

Developing infrastructure raw materialimport & finished goods export became easy

Positive attitude of govt. towards

realization & investment of foreign capital



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Global Sourcing



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Role of Merchandiser

In small companies, the merchandiser has total responsibility for

sourcing decisions

In mid sized companies, the merchandiser is accompanied with

sourcing agents

With the increasing variety of trims and fabrics sourced from

different countries, the merchandiser faces the timing and logistics

challenge ( time management ).



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Sourcing Options

Internal Manufacturing

External Manufacturing

Internal cum External Manufacturing



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Sourcing

Internal

Domestic Off-shore

External

Domesticcontractor

Foreigncontractor



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Sourcing Options

The decision is based upon following

factors:

Companys Financial Resources

Level Of Manufacturing Expertise

Strategic Objectives



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Benefits Control over flow of raw materials, production schedules and

deliveries

Quality more easily established and monitored

Response time is alternating and optimized as the priorities are

established and controlled by the owner of the facility

The cost incurred on a long term basis for a garment reduces



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Using up an outside contractor for manufacturing purposes

Eliminates the financial risk of owning plant and equipment and

carrying overhead during downtimes



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Two basic approaches to external

manufacturing are:-

Cut, Make and Trim (CMT) Sourcing

Full Package (FP) Sourcing, also known as

Original Equipment Manufacturing ( OEM)



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CMT Sourcing Benefits

Flexibility Reduced Investment

Control over Design



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FP Sourcing Benefits

Limited Technical Knowledge

Limited Investment

Limited Commitment


Documents

5 FM Sourcing