What Are The Advantages And Disadvantages In Outsourcing To Vendors In A Supply Chain?

Question

What Are The Advantages And Disadvantages In Outsourcing To Vendors In A Supply Chain?

3 Answers

Answer Question

Answer 1

Advantages:

You don't need to learn the required skill-set yourself. Because you pay someone to do it. If you do it yourself, it's another burden and it will be more inefficient at the start. Because professional sellers are better than that people of your own stuff but only at certain points.

Disadvantages:

You can't train them the way you like
You will lose a cut of your profit
Vendors care less about your product than your own employees so you lose some expertise.

Answer 2

I will enumerate advantages only :)

1. Higher Returns on Investment

2. Improved Efficiency

3. Increased Speed of Delivery

4. More Management Time

5. Ease of Employment Handling
The company where I work practice outsourcing more than 10 years already, it is a very beneficial practice for us. We order Java based products mostly, here's a very nice article on this topic, not commercial https://diceus.com/open-source-erp-java-based-product-choose .

Answer 3

Advantages of oursourcing are: It helps to get the expertise of the vendors, save from the fixed costs of maintaining the plant and machinery. It also helps the company in focussing on its core business activities.e.g. A company outsourcing its advertising to the ouside agency. To save the cost of mainraing a advertising depart meant .
Disadvantages of this are: It results in lesser control over its activites, some times company has to face the monopoly pricing and has to bear the cost. Sometimes the organisation has to solely depend on the vendor for its production process....