The Significance Of International Purchasing On The Organization Productivity
[A CASE STUDY OF DOYIN INVESTMENT COMPANY]

As described in the Figure, the companies included in the first level of the continuum develop strictly domestic purchasing activities. In the second level, firms perform sourcing activities as a reaction to foreign suppliers’ offers or because they confront with needs which no suitable domestic supplier can fulfill. Starting with the third level, organizations recognize that purchasing internationally can bring important performance enhancement and begin to develop sourcing strategies based on international options.
The last two levels concern the global sourcing phases. Companies operating at the fourth level implement sourcing strategies primarily focused on the development of sourcing contracts with suppliers that have global connections. In addition, according to Trent and Monczka (2005), buying firms situated at the highest level of sourcing, stress the integration, standardization and coordination of functional groups and activities among worldwide purchasing locations. Considering the objectives of the present paper, the element of analysis will be focused on small and medium-sized companies involved in international purchasing practices. Thus, the discussion will further concern on the organizations engaged in sourcing practices situated at the second and third levels of the continuum. To sum up the conceptual discussion, a definition for international purchasing suitable to the study would include the process of importing goods that have not been previously manufactured inside the company from firms located in different foreign countries.
Referring to a study developed by Servais et al (2007), developed a representative framework, which contains four specific forms of international sourcing: international purchasing, international subcontracting, foreign joint venture and controlled foreign manufacturing.