Which of the following is considered a hidden cost associated with global sourcing?

Import duties are considered a hidden cost associated with global sourcing because they can significantly affect the overall investment and profitability of sourcing materials or products from foreign suppliers. These duties are often overlooked during the budgeting phase, but they can have a substantial impact on the total cost of goods sold, as they are additional taxes imposed by governments on imported goods. When companies engage in global sourcing, they might focus primarily on the purchase price of items, without fully accounting for these extra costs that can arise when goods cross international borders.

In addition, import duties can vary based on the country of origin, type of product, and trade agreements, making it essential for companies to conduct thorough cost analyses that include these potential expenses. Ignoring hidden costs like import duties can lead to unexpected financial pressures and negatively affect long-term strategic planning and profitability.

While employee training costs, facility maintenance costs, and marketing expenses are also important to consider in a global sourcing strategy, they are typically more direct and easier to quantify in relation to operational expenses and market execution.