China not the only low-cost country

Turkey and other countries may also offer low-cost country advantages.

By Staff -- Purchasing, 5/5/2008 1:35:00 PM

Don’t be so quick to turn to China when considering a low cost country sourcing strategy, Craig Reed, vice president of procurement and logistics at MeadWestvaco, told attendees at the Sourcing in Eastern Europe educational session on Sunday at the ISM Conference in St. Louis.

“There are issues with China that supply management professionals may want to consider such as recent moves by the government to restrict lending and implementing other measures to suppress industrial growth,” Reed said. “And that’s over and above long leadtimes and total cost of ownership concerns.”

From his experience, he suggested supply managers consider Central and Eastern Europe for its strong infrastructure, relatively low labor rates, skilled workforce, and membership in the European Union, whose laws and regulations may give supply managers some added comfort and security especially regarding intellectual property.

David Hauxwell, director of global sourcing at MeadWestvaco, presenting with Reed, gave attendees their take-away. “A country that’s widely overlooked by supply managers is Turkey. It’s a new found area, with incredible growth and infrastructure.”

In making a choice to purchase goods from Turkey, Hauxwell recommended supply managers keep in mind that the country “can be very regional” and that it is a good idea to have individuals on the ground to do business with suppliers located there and in other Central and East European countries.

See also: Low-cost country sourcing: Around the world in 5 (not so) easy steps

For more coverage direct from the show floor at Institute for Supply Management meeting in St. Louis, go to the landing page for Purchasing.com’s coverage here.