Purpose – The purpose of this paper is to investigate the issues pertinent to sourcing internationally from lowcost countries (LCCs) and to understand which issues are associated most strongly with a firm's logistics performance. Design/methodology/approach – Comparative examination of supply sources in developed countries and LCCs is conducted using a pairedsample setting. Data acquired by a mail survey of USbased manufacturing firms are analyzed using a canonical correlation analysis (CCA). CCA helps to reveal the structure of relationships within and between a set of sourcing issue variables and a set of the logistics performance variables investigated. Findings – Results indicate that the issues that should be priorities for improvement are: supplier production capability; business culture and practices; and communication infrastructure. Research limitations/implications – The survey data and analysis focused on US manufacturing firms importing from LCCs. However, there is increasing activity of US retailers importing from LCCs, suggesting a need for a followon study which considers the retailer perspective. Practical implications – Results not only validate the issues to be considered in sourcing from LCCs, but also provide a direction for logistics managers in allocating an organization's scarce resources to the issues of highest potential for improving logistics performance. Originality/value – The fast emerging role of LCCs as supply sources of US firms and the cost advantages of sourcing from LCCs are widely recognized. However, challenges associated with sourcing internationally from LCCs and the extent to which they are related to a firm's logistics performance have received limited attention in existing logistics research. This study contributes valuable insights into this area of international sourcing and logistics management.
All Science Journal Classification (ASJC) codes
- Business and International Management