Importance of Central and Eastern Europe in Procurement

PROCUREMENT FREELANCERS PRESENTS

Importance of Central and Eastern Europe in Procurement

Topics to be Covered Introduction A Closer Look at the Region Strategic Factors to be Considered Contact Us

Procurement Freelancers | 2019

Introduction Sourcing and procurement of products, resources and services are usually carried out from China, India and other developing Asian countries. This is due to the easy availability of raw materials and the abundance of cheap yet skilled labour.

The countries of Central and Eastern Europe (CEE) are largely underused by Western Europe and the rest of the world, for procuring resources, although these regions have enough potential to rival China, the largest manufacturing hub in the world.

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Central & Eastern Europe (CEE) are going through a reconstruction phase both politically and economically.

Predominantly, these are industrial economies with prominence of manufacturing and services sectors but still with an important agricultural sector in some countries.

- DRAGON SOURCING

A Closer Look at the Region The CEE regions are very competitive locations for procurement and sourcing because of the presence of a favourable atmosphere for business, strong potential and demands in the local markets. Also, the total landed costs are low. The sourcing experts opine that the CEE regions have a very competitive market which will continue to grow for the next few decades. The Eastern European countries possess exceptional productivity and capabilities and offer a business environment that is more favourable than the ones found in Asian countries.

Strategic Factors to be Considered Considering the strategic factors like capitalising on local talents, the potential of the local market and the risks of port congestion, it becomes profitable to source and procure materials and services from the central European countries than that from China or any other Asian country.

Competitive costs

Dealing with port congestion

Market growth and opportunities Procurement Freelancers | 2019

Competitive costs The labour costs in CEE are relatively less, compared to that in the rest of Europe. So, it becomes beneficial to source and procure products and services from these countries instead of from countries in Asia to save both time, money and energy.

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Dealing with port congestion All the materials are imported from China, overseas and consequently, the ports in the western part of Europe face the issues of strained networks, shortage of labour and congestion of traffic.

Although the far eastern ports may be utilised in this respect, yet it is wise to use the ports of the CEE countries, which have favourable environmental conditions and lenient rules of maritime trade.

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Market growth and opportunities The CEE countries have enough potential and opportunities for market growth and development.

Being a smaller region than China or the other Asian countries, the countries of CEE have a lesser population, yet they produce almost the same amount of GDP, per capita. The CEE countries consist of more than ten national markets which comprise of the regional subsegments, targeted by the different companies.

Procurement Freelancers | 2019

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