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Supply Chain Issues From Canada To China

Submitted by thanlon on April 28, 2006

Category: Business
Words: 4045 | Pages: 17
Views: 281
Popularity Rank: 40,954
Average Member Grade: N/A (Add a Comment / Grade this Paper)

Recently an opening of the economies of developing nations, especially China, has allowed a huge shift in outsourced production. For the most part the products of the outsourcing are destined for North American consumption, which creates interesting obstacles to the realizations of improvements predicted. Mega Bloks Inc is a Canadian example of this trend, having recently made their own foray into outsourcing to China. An examination of supply chain issues reveals the overall complexity and number of issues which could develop for a company like Mega Bloks. More specifically, for Mega Bloks issues of logistics, regulation, control (in general and specifically of quality) come to the forefront. All of these issues can individually and in aggregate lengthen the supply chain and as a result increase costs well beyond the optimistic predictions of the savings to be gained from outsourcing. However, if the issues are identified and analyzed companies like Mega Bloks can control the supply chain.
It can be proposed that the tremendous growth in global trade experienced in recent decades and the liberalization of closed economies were, in large part, correlated with large investments in designing and managing vast supply chains that span countries and continents. The advances in outsourcing (particularly offshoring) and supply chain management have ushered in such immense successes for many companies that it is often depicted as something of a magic bullet – a panacea for all the operational woes of catering to an increasingly fast-paced, competitive, and consumerist market. More and more businesses are buying into this outsource and supply chain euphoria. A study conducted by AMR Research indicates that more than three-quarters of the 300 North American manufacturing and distribution companies surveyed had developed supply chain organizations . Many such deals are big and strategic enough to qualify as "bet the company" arrangements involving a...

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