Case One: New supplier development
A mechanical products manufacturer needs low cost supply in aluminum extrusion to reduce their cost and win market share back. Without experience of sourcing, they do not know where to start and what they should expect.
A pool of over 30 candidates was selected, through the process of screening and evaluating, We develop two suppliers for this company's aluminum extrusion components. A local team of three persons was set up to accommodate its sourcing operation. No need of office, warehouse.
Project lasts 9 months. This company got a strong, reliable, lower cost extrusion supply with a simple but effective sourcing operation.
Comments: Sourcing operation should suit for your need and minimize the investment, the size of local team, office or not, really depends on the real sourcing situation.
A mechanical products manufacturer needs low cost supply in aluminum extrusion to reduce their cost and win market share back. Without experience of sourcing, they do not know where to start and what they should expect.
A pool of over 30 candidates was selected, through the process of screening and evaluating, We develop two suppliers for this company's aluminum extrusion components. A local team of three persons was set up to accommodate its sourcing operation. No need of office, warehouse.
Project lasts 9 months. This company got a strong, reliable, lower cost extrusion supply with a simple but effective sourcing operation.
Comments: Sourcing operation should suit for your need and minimize the investment, the size of local team, office or not, really depends on the real sourcing situation.
Case Two: Refurbish supply chain
A consumer product company with over ten years experience purchasing from China through a middle man. In past ten years, they rely on the middle man in China. However, when they encounter recession of their business, the middle man force them to accept shipment they do not need.
In that moment, our client found that they never really owned the supply chain, they do not have complete supplier profiles, no direct connection with the real manufacturers, some of suppliers never has on-site visit... They let the middle man manage other suppliers without necessary control process. When they have to take tens millions inventory, they found their TCO (total cost of ownership) is way higher than they thought. They do not make savings anymore.
We help this company to clarify all legal relationships with each single supplier, set up a supplier management system, restructure their supply base, optimize all internal processes. Set up a local office to be liaison between parent company and suppliers.
After 12 months work, a well managed and controllable supply chain was re-set. No middle man, dramatically lower TCO, lower inventory, more responsive supply base.
Comments: 'Middle man' model is a common model for lot of small-mid size companies' sourcing operation. It very likely will cause you higher TCO, conflict interests problem, legal issues.The most long term harm of this model is you lost the opportunity to set up your own independent sourcing capability because you never really own the supply chain on your hand.
A consumer product company with over ten years experience purchasing from China through a middle man. In past ten years, they rely on the middle man in China. However, when they encounter recession of their business, the middle man force them to accept shipment they do not need.
In that moment, our client found that they never really owned the supply chain, they do not have complete supplier profiles, no direct connection with the real manufacturers, some of suppliers never has on-site visit... They let the middle man manage other suppliers without necessary control process. When they have to take tens millions inventory, they found their TCO (total cost of ownership) is way higher than they thought. They do not make savings anymore.
We help this company to clarify all legal relationships with each single supplier, set up a supplier management system, restructure their supply base, optimize all internal processes. Set up a local office to be liaison between parent company and suppliers.
After 12 months work, a well managed and controllable supply chain was re-set. No middle man, dramatically lower TCO, lower inventory, more responsive supply base.
Comments: 'Middle man' model is a common model for lot of small-mid size companies' sourcing operation. It very likely will cause you higher TCO, conflict interests problem, legal issues.The most long term harm of this model is you lost the opportunity to set up your own independent sourcing capability because you never really own the supply chain on your hand.
Case Three: Quality system implementing
A tool company has a small engine cost reduction project. They found that these companies satisfy their cost goals are in a early stage of quality management system. They need a solution to improve suppliers' quality performance in a timely manner without any reverse affect on cost.
To improve quality performance in a low cost environment, we are very cautious to not interrupt their current process. After finding each supplier's weakness by flow analysis, we set up improvement plan for each of three metal suppliers. Tools as VA/VE PPAP were interpreted in their language and a simplified format.
With implementation of our plan, these suppliers can basically satisfy document requirements in TS16949 environment. We help these suppliers significantly improve their quality performance without heavy capital investment so they can keep their commitment of cost.
Comments: Usually, low cost suppliers miss some value add steps in their work flow, either because they do not realize it, or they do not have the tools. By implementing some crucial steps in their flow, we will reach very good return.
A tool company has a small engine cost reduction project. They found that these companies satisfy their cost goals are in a early stage of quality management system. They need a solution to improve suppliers' quality performance in a timely manner without any reverse affect on cost.
To improve quality performance in a low cost environment, we are very cautious to not interrupt their current process. After finding each supplier's weakness by flow analysis, we set up improvement plan for each of three metal suppliers. Tools as VA/VE PPAP were interpreted in their language and a simplified format.
With implementation of our plan, these suppliers can basically satisfy document requirements in TS16949 environment. We help these suppliers significantly improve their quality performance without heavy capital investment so they can keep their commitment of cost.
Comments: Usually, low cost suppliers miss some value add steps in their work flow, either because they do not realize it, or they do not have the tools. By implementing some crucial steps in their flow, we will reach very good return.
