• Global Competitive Conditions Driving the Manufacturing Location Decision

    Given today's rapidly shifting global competitive conditions--including customer location, natural disasters, currency valuation, labor and transportation costs and availability--many U.S. companies are revisiting decisions about their preferred manufacturing location(s). The purpose of this research is to understand some of the trends that affect whether U.S.-based companies bring their production back to the United States or relocate it to different geographical locations (reshore). The focus is on the key factors that affect companies' manufacturing location decisions, the importance of these factors, and how the importance has changed over time. Because of the complexity involved in the manufacturing location decision, key risk factors inherent in the manufacturing decision are also assessed. Survey responses from 319 companies that currently manage offshore manufacturing plants are analyzed. Among other insights, this study found that 40% of these companies perceived a trend toward reshoring to the U.S. in their industries. The companies involved in this study also place an increasing importance on where their customers want them to locate, as well as how the location could help expand into new customer markets. These and further results and implications for U.S. manufacturing companies are presented herein.
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  • Online Reverse Auctions: Common Myths versus Evolving Reality

    Business-to-Business (B2B) online reverse auctions have become a popular way to source products and services. Due to their relative newness and conflicting reports, however, several myths and misconceptions about them still exist. Investigates the truth behind five common myths associated with reverse auctions and, based on insights obtained from 30 case study companies, provides prescriptive evidence and direction for supply managers regarding how not to fall victim to these myths. Presents useful guidance to achieve the following realities: First, while a lower price is one objective in reverse auctions, it is often not the most important, and can easily be complemented with non-price attributes; Second, commodity items are usually easier candidates for reverse auctions, but non-commodity items can also be bid successfully; Third, reverse auctions can frequently hurt buyer-supplier relationships, but there are many ways to prevent this from happening; Fourth, while first-time bidding events generally result in higher savings, continued cost advantages are possible; and Fifth, even though there is a decline in reverse auctions usage, they are here for the long run.
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