Outsourcing and supplier development: capability development process in the Brazilian sports apparel industry

Scur, Gabriela; Kolososki, Camila

doi:10.1590/0104-530X-2761

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Original Article • Gest. Prod. 26 (2) • 2019 • https://doi.org/10.1590/0104-530X-2761 copy

Outsourcing and supplier development: capability development process in the Brazilian sports apparel industry

Terceirização e desenvolvimento de fornecedores: processo de desenvolvimento de capacidades na indústria brasileira de vestuário esportivo

Authorship SCIMAGO INSTITUTIONS RANKINGS

Abstract

Outsourcing allows quick reactions to market fluctuations and allows firms to focus on their core business. This strategy is currently used in the Brazilian apparel industry. The paper analyzes the interaction between big customers (some multinationals firms) and Brazilian suppliers in the sports apparel industry to verify how these relationships can contribute to the capability development of suppliers. Multiple case studies were conducted. The findings indicated that collaborative, and long-term relationships are beneficial to businesses and customers significantly influence the development of the sewing factory suppliers with whom they work.

Keywords:
Outsourcing; Supply Chain Management; Partnership; Brazilian apparel industry

	CONSTRUCTS	ACTIONS	INDICATORS	QUESTIONS: clients and suppliers
1	Knowing my supplier	1) Buyer: visits and information gathering; 2) Knowing my supplier's processes; 3) Understanding and respecting supplier's limitations.	- Frequency and duration of the visits; - Comprehension of supplier's flow and culture; - Existing level of interaction.	- What is the existing level of interaction with suppliers / clients? - What is the subjects of these interactions? - Are there engineers in the client / supplier? - Do the clients visit suppliers? - What are the frequency and duration of the visits? - In case of problems, does the client active participate with the supplier on the resolution? - Does the client really understand supplier's process, culture and limitations? - Is there mutual respect between the parties?
2	Competition among suppliers	1) Promoting competition among suppliers; 2) Suppliers certification / segmentation.	- Business gains or losses; - Results improvement generated by the motivation to compete.	- Does the client promote competition between suppliers and how does it occur? - What is the reward given to the winner? - What are the criterea to evaluate the competitors? - Does the client believe that this practice motivates suppliers? / Does the supplier believe this practice is motivating? - Does the company certify and segment suppliers by their levels?
3	Suppliers supervision	1) Suppliers assessments and monitoring; 2) Buyers involvement in supplier's improvement action plans; 3) Senior management involvement in performance meetings; 4) Development of suppliers' problem solving skills; 5) Great performance recognition.	- Key performance indicators and frequency of monitoring; - Suggestions and buyers level of involvement; - Position of people involved in the meetings; - Trust and autonomy; - Recognition.	- Does the client assess supplier's performance? - What are the indicators and frequency? - Does the supplier also assess client's performance? - Does the client get involved to help suppliers getting better performances? - Is top management from both parties involved in performance meetings? - Is the focus of the client acting on problem solving or on developing supplier's skills on problem solving? - Does the client trust suppliers? Does the supplier trust the clients? - Does the client recognize supplier's good performances?
4	Technical capabilities development	1) Buyers involvement on the development of supplier's technical capabilities; 2) Trainings provided to suppliers.	- Technical capabilities developed; - Amount of trainings provided.	- Considering technical issues (product development, production, etc.), do the client develop supplier's capabilities? - What were the supplier's technical capabilities already developed by the company? - What are the benefits on developing supplier's capabilities? - How does it occur: by a missing capability identified by the client or under supplier request? - Does the client offer technical trainings to its supplier? How often?
5	Dissemination of information	1) Criteria for information dissemination; 2) Meeting structuring.	- Accurate and useful information; - Effective meetings.	- How does information sharing occur between client and its supplier? - Does the client / supplier consider it is an effective or an exaggerated information sharing? - What are the information exchanged? - Are the meetings previously scheduled and prepared? Are they effective?
6	Joint improvement activities	1) Good practices exchanges; 2) Joint projects developed; 3) Investments.	- Exchanges: experiences and know how; - Project performances; - Return over investments.	- Do the client and supplier conduct joint activities? - What are the focus and frequency of the joint activities? - What are the contributions of each party of joint activities? - What are the results? - Has the company / supplier ever done any investment due to specific request of the partnership? - What and how much were them? - Have these investments had the expected return? - What are the other kind of investments (except money) the client has ever done to its suppliers?

CLIENTS	Origin	Year of Foundation	Turnover 2011	Qty of Stores	Qty of employees	Qty of suppliers (in Brazil)	Qty of pcs/year (in Brazil)	Interview	Secondary data
SPORTFRANCE	Foreign	1976	EUR 6,5 bi	630	45,000	13 suppliers	2 million	Position: Manager of Sustainability Duration: 3 hours	Sustainability report News from Internet portal Data from company's website
SPORTBRA	National	1988	R$ 150 mi	80	150	3 suppliers 10 factions	1,5 million	Position: Manager of Industrial Operations Duration: 2 hours	Sustainability report News from Internet portal Data from company's website
SPORTEURO	Foreign	1948	EUR 13 bi	560 + multibrands	46,000	14 suppliers	2 million	Position: Manager of Industrial Operations Duration: 1h30min	News from Internet portal Data from company's website
MODAFASHION	National	2003	R$ 3 mi	1 + multibrands	30	10 suppliers	20 thousand	Position: Manager of Industrial Operations Duration: 1h30min	News from Internet portal Data from company's website
SUPPLIERS	Origin	Year of Foundation	Turnover 2011	Size	Qty of employees	Qty of clients	-	Interview	Secondary data
APUCARANA	National	2008	R$ 3,6 mi	Mid size	80	40	-	Position: Manager of Industrial Operations Duration: 1h30min	News from Internet portal Data from company's website
CASCAVEL	National	2000	R$ 30,9 mi	Big size	310 Brazil 100 Paraguay	8	-	Position: General Director Duration: 2 hours	Sustainability report News from Internet portal Data from company's website
APUCARANA CAPS	National	1989	R$ 1,3 mi	Big size	160	30	-	Position: Manager of Industrial Operations Duration: 2 hours	News from Internet portal Data from company's website
SPPREMIUM	National	1987	R$ 2 mi	Mid size	25	25	-	Position: Manager of Sustainability Duration: 1h30min	News from Internet portal Data from company's website

	CONSTRUCTS	INDICATORS	CLIENTS	SUPPLIERS
1	Knowing my supplier	Level of client involvement Subject of discussion Engineers on the field Frequency and duration of the visits Involvement or charging solution Understanding supplier operations, culture, limitations Mutual respect	Significant Product development, Quality, Production Yes Monthly - 2 days Participation Yes Yes	Low Product development, Quality, Audits No Once/2 months - 2 days Charging solution Superficial Yes
2	Competition among suppliers	Competition among suppliers Reward to winners Criteria for competition Motivating action? Clients direct involvement to help Certification of suppliers	Not directly Volume, New product models Price, Delivery, Quality Yes Yes No	Yes Volume, New product models Price, Delivery No No No
3	Suppliers supervision	KPIs assessed Frequency of monitoring Clients direct participation to improve KPIs Development of problem resolution skills Mutual trust Recognition for good performances	DOT, Quality, Product development Monthly Yes No Yes Yes	DOT, Quality Monthly Yes No Yes Sometimes
4	Technical capabilities development	Clients develop technical capabilities Developed capabilities Benefits Training promoted by the clients Frequency of trainings	Yes Quality, Productivity, Factory infrastructure Better prices, Flexibility, Product compliance Quality, Audit requirements, Purchase Whenever necessary	Yes Quality, Process organization, Factory infrastructure Culture of quality, better performances Quality Whenever necessary
5	Dissemination of information	Effective exchange of information Scheduled and effective meetings	Yes Yes	Yes Yes
6	Joint improvement activities	Good practice exchange Realization of joint projects Performance obtained Contribution client side Contribution supplier side Investments - clients requirements Investments - to help suppliers Guarantee for investments Return on investments	No No --- --- --- Yes: Machinery, Factory infrastructure, Time, Visit, Audit, Quality tests Dedicated staff No Yes	No No --- --- --- Yes: Machinery, Facture infrastructure, Time, Visit, Audits, Quality tests Dedicated staff No Yes

Universidade Federal de São Carlos Departamento de Engenharia de Produção , Caixa Postal 676 , 13.565-905 São Carlos SP Brazil, Tel.: +55 16 3351 8471 - São Carlos - SP - Brazil
E-mail: gp@dep.ufscar.br

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