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A PRACTITIONER'S DECISION MODEL FOR THE TOTAL COST OF OUTSOURCING AND APPLICATION TO CHINA, MEXICO, AND THE UNITED STATES
Author(s) -
Kumar Sameer,
Kopitzke Kristoffer K.
Publication year - 2008
Publication title -
journal of business logistics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.611
H-Index - 79
eISSN - 2158-1592
pISSN - 0735-3766
DOI - 10.1002/j.2158-1592.2008.tb00089.x
Subject(s) - outsourcing , china , business , decision model , industrial organization , operations management , marketing , economics , mathematical economics , political science , law
Outsourcing of manufacturing to Mexico and China includes costs that are not always considered and benefits that are not always correctly quantified. An analytical model for determining outsourcing costs was developed and results from that model are presented. Using that model, the sensitivity of outsourcing costs to several variables was modeled and analyzed. Guidance is provided regarding factors to consider in an outsourcing decision.