Glocal sourcing: How to Combine Global and Local Sourcing

Details

Supervisors

Constantin Blome

Faculty

Louvain School of Management

Degree label

Master [120] : ingénieur de gestion, à finalité spécialisée

Abstract

Companies nowadays are increasingly adopting a mixed sourcing strategy that combines global and local sourcing, namely glocal sourcing. However, the parameters used to determine the right balance to reach optimal results between global and local sourcing remain unclear. The goal of the paper is to understand business reality against the scientific literature of finding the balance point between global and local sourcing in the FMCG industry. A multiple-case study of 5 MNEs in the FMCG industry (AB InBev, Nestle, Pepsi, P&G, L'Oréal) is conducted to answer the three main research questions. The result shows that the main reason for global sourcing is the large capacity of global suppliers; while the drivers for local sourcing remain various among companies. Nevertheless, the nature of goods is not found to be a reason to adopt different sourcing strategies; the cost and agility trade-off is also not found to be a significant concern for deciding on sourcing strategies.