11.5.10 setup OSP for all the finished Goods

Dear All

The globalization phenomenon has lead to geographical proliferation of trade and business, The manufacturing and trading activities are spread across the globe to leverage the competitive advantages of different geographies and also target wider range of markets.Example Company A which is locate in USA, is the headquartes and Distribute and sale the finished Goods, while Company B is locate in Mexico which manufacture the finished Good. Company B is called Maquila.What is a maquila?: The short answer is a maquiladora is a factory or assembly plant operated in Mexico under preferential tariff programs established by the U.S. and Mexican governments to encourage the development of industry in Mexico. Mexico allows materials to be used in maquilas to enter duty-free, provided the finished product is then immediately exported out of Mexico. The U.S. in turn charges these products a much lower tariff than products from other countries.To summ up, Company A is going to Supply all the raw materials to Company B. Company B is going to manufacture all the finish goods