Abstract
Background: Global sourcing has increased as buyers searched for new markets that offered better pricing, quality, variety and delivery lead times than their local markets. However, the increase in global sourcing has also exposed businesses to many supply risks.Purpose: The purpose of this descriptive qualitative study was to explore the global sourcing supply risks encountered by small clothing and textile retailers in Gauteng and to determine what supply risk identification and management approaches they utilise.Method: This study utilised semi-structured interviews conducted with 12 small clothing and textile retail owners.Results: The study found that the three major supply risks encountered by these retailers were fluctuating exchange rates, communication barriers and costly and complicated logistics, which included high customs costs. Furthermore, although aware of the supply risks, none of the small clothing and textile retailers had formal identification and management approaches in place. Instead, risks are dealt with at the sole discretion of the owner as and when they occur. The study also found that informal identification and management approaches were being applied by some of the retailers. These included factoring exchange rate fluctuations into the profit margins and using translators to combat communication barriers.Contribution: The study is one of the first empirical studies conducted on global supply risks and the associated identification and management approaches in the South African small business context, specifically focused on clothing and textile retailers.Conclusion: Small clothing and textile retailers need to proactively identify and manage global sourcing risk using the identified approaches in order to reduce and mitigate potential supply disruptions.
Highlights
Global sourcing can bring many benefits to a business, it can expose it to several supply chain risks (Deane, Craighead & Ragsdale 2009:861; Kumar, Himes & Kritzer 2014:875)
Contribution: The study is one of the first empirical studies conducted on global supply risks and the associated identification and management approaches in the South African small business context, focused on clothing and textile retailers
Informal supplier relationship building and management Ho et al (2015:5049) and Ellis et al (2010:38) found that building strategic relationships with suppliers proved beneficial for buyers, this study found that very few small clothing and textile retail owners engaged in strategic supplier relationship building and management
Summary
Global sourcing can bring many benefits to a business, it can expose it to several supply chain risks (Deane, Craighead & Ragsdale 2009:861; Kumar, Himes & Kritzer 2014:875). In 2014, the outbreak of Ebola in West Africa caused major supply chain disruptions across the globe, with many countries suspending flights to and from the region. This resulted in delays in all air and sea cargo destined for Europe, Asia and the United States, mainly from Guinea (aluminium ore), Liberia (rubber), Nigeria (oil) and Sierra Leone (iron ore) (BSI 2014:2–6). In 2013 the 4-week strike of workers in the South African car manufacturing industry led to a supply shortage of components and a slowdown in the manufacturing of motor vehicles This resulted in disruptions in the supply of vehicles to international markets and a daily loss of approximately R600 million for BMW, GM, Ford, Mercedes-Benz, Nissan, Toyota and Volkswagen (Williams 2013). Purpose: The purpose of this descriptive qualitative study was to explore the global sourcing supply risks encountered by small clothing and textile retailers in Gauteng and to determine what supply risk identification and management approaches they utilise
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
