Product sourcing involves locating and procuring a business’s necessary goods or services. This includes researching, assessing, and bargaining with suppliers while overseeing product quality, timely delivery, and expenses.
This write-up delves into a new product sourcing strategy for sourcing while importing from a country like China.
- Prefer to go for digital products
The lockdown year drove people indoors and businesses online. Digital commerce dynamics shifted in 2020, favouring existing online businesses while pushing brick-and-mortar stores to transform digitally.
Sectors like government and healthcare also adopted digital solutions. Product managers adapted skills for rapid market integration.
Businesses swiftly embraced digital-first models for evolving market demands. The digital momentum continued in 2021, and the trend appears strong for 2023 despite two years of the new approach.
- The product must be sustainable
Environmental concerns have gained widespread attention in a new product sourcing strategy, impacting big brands’ plans and budget. Both consumers and businesses now prioritize eco-friendly products and packaging.
In the US, 48% of consumers are willing to change consumption habits to reduce environmental impact. Businesses must create items catering to environmentally sensitive clients without sacrificing quality to keep up with this trend.
In 2023, there is significant optimism for growth in the number of sustainable products offered.
- Create a product specialist
Product managers are under more pressure due to expanding teams’ increased product responsibility.
Businesses are using expert product managers who concentrate on specific topics such as:
- Market
- Growth
- Operations
- User experience.
Yet, adapting to these evolving requirements for digital enterprises might take time. Traditional companies, meanwhile, can concentrate on product quality and growth.
During this transition, businesses must identify needs and challenges before expanding.
Although immediately finding the right talent may be challenging, a phased approach will likely lead to a proficient team of product specialists managing various aspects of product delivery.
- Collect data to offer feedback
In a new product sourcing strategy, the rapid data adoption, fuelled by IoT integration, has streamlined market research, consumer targeting, and product design, shortening development cycles.
A third of businesses prioritize consumer-inspired innovation, necessitating data-driven strategies for success in evolving markets.
Over a decade, product feedback searches surged by 161%, with a 47% rise in product research queries in five years. Businesses are increasingly incorporating user data collection into goods to fulfil consumer demand.
Independent developers now integrate data analytics tools. However, few businesses effectively utilize gathered data.
Continuous data acquisition gains importance as product life cycles shrink and market competition intensifies after 2021.
- Create a sourcing model
A sourcing model outlines how products are obtained from suppliers, determining involvement, control, and risk.
Direct sourcing involves procurement directly from manufacturers, offering control but demanding expertise.
Indirect sourcing uses intermediaries like distributors, reducing involvement and risk but diminishing control. Hybrid sourcing combines both goal optimization and demanding supply chain coordination.
- Choose a sourcing agent
The mention of China cannot be ruled out when discussing product sourcing strategies. China is now produces almost every product naturally, a significant portion of sourcing activities originate from this country.
Engaging with Chinese companies can pose challenges due to distinct language and business customs, resulting in communication hurdles.
The optimal strategy involves enlisting a proficient sourcing agent in China, skilled in both English and Mandarin.
This enables seamless execution of the following tasks:
- Identifying the supplier in China
- Negotiating with the suppliers
- Monitoring of quality
- Arranging for shipments
- Offering timely feedback.
Conclusion
Unless organizations commit to a new product sourcing strategy and innovating and adapting alongside the market, their efforts will be in vain.
Emerging trends are poised to enhance the appeal of work and task execution. Moreover, business leaders must remain attentive to various directions over the year.
