Global procurement is an intricate network of suppliers and logistics teams around the world working to help companies get what they need when they need it. But, isn’t international purchasing the same thing?
Before we get too deep in discussion about the difference between global procurement and international purchasing, let’s take a look at the meaning of both global and international. These two terms on their own are different. The word global refers to worldwide or the whole word. International, on the other hand, is much smaller, referring to two or more nations.
Believe it or not, their reach isn’t the only difference between global procurement and international purchasing.
What is Global Procurement?
Global procurement allows businesses to reach higher levels of success when competing with others in their industry. They can work both within their border and beyond their border to obtain things like raw materials and affordable wages – which means they have access to more affordable materials and labor than those stuck within the domestic confines.
Due to its complex nature, however, it often requires working with a company that has a healthy relationship with suppliers and manufacturers around the world. Their connections can be something you can reap the benefits from. And working with this partner means they’ve likely got the logistics all worked out for you.
It’s fair to say that there are many hands involved in global procurement. There is the need to source the goods, negotiations must take place, strategizing over the goods, as well as the warehousing and transport of them. Often more than one good, product, or material is involved — and procuring them is vital for the business to function.
A few benefits of global procurement are:
- Greater access to goods – which also means greater access to quality goods. And because you can find them at the best rate, you are getting better value for your money.
- If you are saving money in securing your raw materials, you can increase your production levels.
- Get ahead of the competition when you have access to supplies worldwide. Your market is much larger. It’s like you are shopping at Amazon while your competitors only have the choices at their local convenience store.
How Does it Differ From International Purchasing?
International purchasing can be viewed as the stepping stone to global procurement. You purchase raw materials, goods, or services to fulfill the needs of your business. You rely on these supplies that you purchase from these international companies. However, unlike global procurement, there are usually no big strategies, negotiations, and such involved.
There are some benefits to purchasing supplies from other countries, such as having access to things that may be in short supply domestically or getting it for a lower cost. All in all, though, it is just the process of buying products, supplies, or services from a country that isn’t your own – without anything else involved.
Benefit From Global Procurement at DXL Enterprises
Branching out into the global market can be a little scary if you’ve only dabbled with international purchasing. It can help having someone on your side that knows the ropes, has the connections, and has access to worldwide solutions to take your business to the next level.