2. What Is ?
MANUFACTURING CONTRACTS
• Is a contractual agreement between a
company and a foreign producer
• This the company retains responsibility for
the promotion and distribution of its product
3. What Is it?
What is it ?
The international company pays another to
manufacture its products with its brand.
4. Are also known as
Manufacturing contracts are also
known as:
• Maquila contract
• Subcontract
5. Participants
Participants whithin Manufacturing
Contracts
• Parent Company - Is the company
that will do the contract
• Local manufacturers from various
countries - The company that will
manufacture the product
• Customers - who buy the product
6. Examples
1. The Indian company manufactures it
and does all the packaging of the
product as required by the American
company …..
2. Nike uses contract manufacturers
throughout Asia to manufacture its
footwear and sportwear……
7. ADVANTAGES
1
2
3
ACCESS TO
LOWER DIVIDE EXTERNAL
COSTS RISK EXPERTISE IN
PRODUCT
SALES
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8. DISADVANTAGES
1
2
3
The
company NO
QUALITY LOSS OF
takes all
CONTROL JOBS
the
decisions
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9. Video
Video
http://www.youtube.com/watch?v=9Qzm7MCusGM
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10. REFERENCES
International Management: Managing in a
Diverse and Dynamic Global Environment
by A. Phatak, R. Bhagat and R. Kashlak.
http://www.eumed.net/cursecon/libreria/l
hp/5d.htm
http://www.sporttech-
argentina.com/exportaciones.html
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