Table 14.4.

Comparison Between Global and Domestic Purchasing

Domestic purchasing	Global purchasing
Culture Single nation and culture	Multinational/multilingual factors
Communications Single language; short lines of communication	Multilingual; long, complex lines of communications
Currency exchange Single currency	Currencies differing in stability and value
Customs regulations Relative freedom	Complex customs and tariff requirements
Lead times and inventories Stable/decreasing lead times and inventories	Long lead times and large safety stocks; need for repackaging and relabeling
Payment Cash and credit transactions	Letters of credit, electronic payment, and countertrade
Quality Common quality standards and specifications	Different standards of quality
Government involvement Minimal interference	Direct involvement in national economic plans
Economic stability Uniform economic environment	Variety of financial climates ranging from over-conservative to wildly inflationary
Operational coordination Easy access to plant visits and technical assistance	Long-distance coordination with local managers