Outsourcing relationships between American and Chinese companies

Abstract

Outsourcing relationships between American and Chinese companies were studied using interviews and surveys. The data showed that American companies focus on labor costs and quality when making a decision to outsource production to a Chinese firm. Chinese firms secure American business by offering the lowest price possible. American firms were found to be generally pleased with cost performance of their outsourcing relationships, but less pleased with lead times of outsourced products. In addition, communication between the American and Chinese firms and employee training at Chinese firms are viewed as needing improvement.