sourcing

Sourcing

In private equity, a slang term for cold calling potential clients.

Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

sourcing

the selection by a firm of its sources of supply – raw materials and components in the case of a manufacturer, final products in the case of a retailer. Strategically, a firm may chose to buy in a particular input (or product) from an outside supplier (OUTSOURCING), or produce it for itself as part of a vertically integrated operation (see VERTICAL INTEGRATION, MAKE-OR-BUY DECISION). In the former case, a firm may choose to favour one or a number of suppliers, both domestic and overseas-based, depending on various cost and risk considerations. For example, relying on a single supplier may allow the firm to benefit from discounts given on bulk purchases, but on the other hand may expose the firm to great risk of supply disruptions. For this reason multiple-supplier locations may be preferred, especially in the case of MULTINATIONAL ENTERPRISES which may deploy global sourcing strategies to take advantage of differences in supply costs between countries and obtain access to new component technologies and products. See LOCAL CONTENT RULE, JUST-IN-TIME (JIT) SYSTEM, INTERNATIONALIZATION, PURCHASING SUPPLIER DEVELOPMENT.

Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

sourcing

the selection by a firm of its sources of supply - raw materials and components in the case of a manufacturer, final products in the case of a retailer. A firm may choose to buy in a particular input (or product) from an outside supplier or to produce it for itself as part of a vertically integrated operation. See OUTSOURCING and VERTICAL INTEGRATION for further discussion.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005