Sourcing from China: Approaches and Outcomes for Swedish Firms

Abstract

The large and persistent trend of firms sourcing from China is in itself well-established with many success stories. However, managing the sourcing is a complex issue confounded both by cultural differences and the length of the supply chain. The purpose of this paper is to analyze the sourcing approaches of Swedish companies in China and the resultant outcomes. This study is based on a set of cases of Swedish manufacturing and retailer firms. The firms represent different industries and sizes of the company but all have substantial experience sourcing from China. The paper finds that the firms have developed good monitoring systems for their sourcing work and are generally satisfied with the outcomes, but also have persistent communication issues. Two archetypes of firms successfully sourcing from China emerge from the research. The study shows the importance of investing long-term in sourcing operations, especially with regard to developing market understanding and supplier relationships. This must however be matched by appropriate supplier monitoring systems. The research addresses a gap where sourcing configurations and their outcomes beyond general assessments of whether they are successful or not are little explored in the literature.