advanced theory and practice in sport marketing - Marshalls University

Partnership sourcing is more preferable because it leads to long-term partnership
based on trust between buyer and supplier. Once a level of mutual trust has
been established, business partners usually give preferential treatment to its repeat
customers in the form of price breaks. Partnership sourcing implies that both
the buyer and the supplier have mutual reasons to be successful. Competitive
sourcing is every company for themselves. Competitive sourcing in the short term
is a more cost effective way to do business. However, this competition does not
lend itself to building lasting supply chains.
Purchasing today is not about squeezing suppliers but rather strategic supplier
management, which involves measuring supplier performance and risks as well
as determining the optimum degree of profit. As logistics costs become an increasingly
larger part of total costs, proactive SCM is the most important factor in
keeping purchasing cost low. This supply chain is the link between the purchasing
process, production, and logistics management.
Purchasing Process
In an era of global sourcing, the multinational company’s success often
hinges on the most appropriate selection of its foreign suppliers. International
suppliers are very complicated and risky because of a variety of uncontrollable
and unpredictable factors affecting the decision. These factors may include political
situations, tariff barriers, cultural and communication barriers, trade regulations
and agreements, currency exchange rates, cultural differences, ethical
standards, and quality standards.
Sporting goods companies have been focused on providing the best possible
quality for the lowest available price. Price is what the consumer equates to the
value of a good or service. Value is what the consumer is willing to pay for a
product. Both price and value are influenced by market trends, corporate climate
and competition for suppliers. These purchasing objectives have forced
companies to seek third world labor forces and partner themselves with longterm
suppliers that have similar company values. Because of the high labor cost
in the United States, it has been more economical to ship raw materials to the
third world, have them produce the good, and then re-ship the finished product
to its destination. This purchasing process stretches the supply chain and increases
the number of logistical variables.
Purchasing in Sport Marketing
The single biggest cost saving measure to the sporting goods industry has
been technology advances in the Internet. Electronic data interchange (EDI) has
affected 100% of the supply chains. In only a matter of months, the change in
the way supply chain partners move product from concept to point of sale (POS)
resembled the difference between walking the basketball up the court and running
the fast break.
The Internet continues to tear down communications barriers from geography
to cost. This technology will be leveraged through new, web-based communities
PURCHASING AND SUPPLY CHAIN MANAGEMENT IN SPORT 179