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Vf Brands Essay

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Below is an essay on "Vf Brands" from Anti Essays, your source for research papers, essays, and term paper examples.

Cecilia Khane – Dana Entenza Tilves - Maria Teresa Lai - Sara Brioschi – Yulia Milushova

Outsourcing – Arguments in favour
 Possibility to achieve lower costs – high bargaining power (TCE)  No need of building special knowledge and investing in factories  Possibility to shift production from one supplier to another in any moment  Flexibility thanks to short term contracts – diversification of ex ante problem

 Decentralization of power and responsibilities

Outsourcing - Arguments against
 Lack of coordination, authority and trust – haggling and hold-up problems  Possibility to have excess inventory – holding costs

 Need of high investment of time both before and after choosing suppliers
 Higher lead time  Lack of loyalty from the workers not directly employed  No interest from the suppliers to ameliorate the technologies  Possibility to lose capacities and experience  Possibility to lose the understanding of manufacturing issues  Risk of losing money and image if a partner doesn’t deliver for any reason

Integration – Arguments in favour
 Introduction of authority in the relationship
 Reduction of haggling costs and hold-up problems  No need to build relations with external parties – less misunderstandings  Independence from other firms – ownership of all assets (PRA)  Shorter lead times – higher adaptation  Secrecy of the products  Maturated experience in some fields  Lower defect rates  Certainty of delivery  High performance of internal plants (RSI)

Integration – Arguments against
 Bureaucracy costs:
 Abuse of power  Agency problems

 Coordination problem if production facilities are geographically dispersed
 Limited adaptation - can’t switch easily the kind of product manufactured

 Huge investment at the beginning
 Need of continuing investments over time  Need to expand the staff and focus also on production

Is outsourcing optimal for others?
Without interest in making Relation Specific...

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Vf Brands. Anti Essays. Retrieved December 16, 2018, from the World Wide Web: http://parimatch-stavka7.com/free-essays/Vf-Brands-529787.html


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