A Case of Combining Sustainable Quality with Cost Reduction through Outsourcing : Ergorapido of Electrolux produced in the PRC

Abstract: With the development of the economy in today’s business world, competitiveness became more important than ever before in every sector. How to keep advantages during global trade and survive the strong competitive environment has become an issue which multinational enterprises also have to face. Outsourcing occurred under these circumstances. This study has integrated outsourcing theories and the empirical study aims to analyses the method and strategy to combining sustainable quality with cost reduction through outsourcing. This study was done in the context of outsourcing  from Sweden to China. Ergorapido of Electrolux is the example-case study used to investigate methods in both cost reduction and quality control. The data was collected by questionnaires, interviews and tele-conference interviews. The paper found that outsourcing has three stages. The first stage is the assessment of the motivations and risks associated with the process of outsourcing. The second stage is the decision making process involved in outsourcing and the arrangement of the outsourcing. The third stage is the management of the relationship with suppliers. Furthermore, both of the participants can benefit from outsourcing no matter whether it is the OEM supplier or the outsourced supply company. Electrolux is a famous company which is successful as a result of outsourcing. All Swedish share enterprises, whether small, medium or large, share the same domestic and international trade climate. If Electrolux can successfully outsource on a global basis,  so can they.