Incoterms, or International Commercial Terms, are a set of three-letter trade terms standardized by the International Chamber of Commerce (ICC). Using these terms properly will allow clear communication of the tasks, costs, and risks associated with transporting goods between your supplier (Seller) and your company (Buyer).
We are fortunate to work with some of the most innovative OEMs, Tier Is/IIs/IIIs and Aftermarket companies in the world and have launched supply chain operations in the US and EU that have included everything from carbon fiber wheels to electric vehicles.
One of the most important decisions a high-growth technology company faces in its early stages is whether to manufacture components and the final product using its own resources (make) or to outsource the manufacturing process to another company (buy).
As companies grow and evolve it is statistically inevitable that supply partners will come and go. There are many reasons why a company may want and/or need to transition supply partners such as supplier financial instability, poor quality performance, and production supply disruption.
When considering where to build your supply base, source components, and source finished products, the prevailing idea seems to be that domestic sourcing allows for better quality control and shorter time to market, while international sourcing is cheaper. Both of these facts can be true, which can make it difficult deciding when to choose one over the other and these oversimplifications may lead to poor strategic decisions.
Actionable insights from IndustryStar on ways to expedite, optimize, and de-risk your supply chain operations.