In this model, products are manufactured in Asia, with locally sourced components and air/sea-freighted to the end-customer's region for distribution. This solution is most suited, to high volume/low complexity production of a stable product profile.
Where lead-time allows and air freight costs are not prohibitive, this model provides a low cost solution suitable for many product types.
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| Product cost |
Low cost labor for product assembly and locally sourced material. |
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| Flexibility |
Limited flexibility most suited to high volumes. |
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| Lead time |
Lead-time determined by freight transit time to customer region (air or sea). This could be reduced by direct distribution from Asia. |
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| Logistics costs |
High freight costs due to bulk and weight nature of product assembled for retail. |
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| Inventory levels |
High inventory levels to compensate for limited flexibility and long lead-times. |
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