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Low cost regions, such as China, India, Eastern Europe, and South America
provide excellent opportunities for North American manufacturers to reduce
the cost of purchased goods while maintaining or improving overall quality.
Annual savings in excess of 35% are obtainable for many materials, but there
are challenges and risks that must be addressed in order to drive bottom lines
savings for many materials.
Manufacturers in low cost regions are making continuous improvements in
quality and technology. It is not uncommon to find ISO certified suppliers
even in the most remote areas. Reducing total costs through low cost regions
sourcing has given our customers an advantage over their competitors - with a
lower cost structure, they have been able to increase margins while expanding
market share.
We have enabled our customers to succeed in sourcing from low cost regions by providing expert services in the following areas:
- Sourcing strategy and program design based on a thorough analysis of customer objectives, current supply base, and manufacturing strategies
- Data collection and RFQ/RFP to capture all commercial, quality, technical, and logistical cost drivers. The optimal strategy drives supplier participation, optimizes savings, and facilitates transition.
- Supply base research and analysis of supplier capabilities through the collection of detailed Requests for Information (RFI)
- Supply base management and negotiation including active management and communication with all suppliers; management of the supplier Q&A process; and conducting negotiations including the use of reverse auction technology where appropriate
- Supplier site visits and scenario analysis to verify RFI information (e.g. equipment in operation) then designing next steps based on Total Landed Cost analysis, taking into account supplier quality, pricing, transportation, taxes, tariffs, inventory, etc.
- Transition planning that includes design and management of a supplier transition plan, incumbent supplier management, safety stock requirement analysis, PPAP process, First Article Inspection, and supplier logistics support
- International procurement services that include supply chain design and execution, warehousing, pre-shipment inspection, freight forwarding, aggregation/consolidation, customs management, transportation, ordering & payment, and management of the new supplier relationship
View Low Cost Country Case Studies:
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