Supplier Efficiency Study and Implementation Support for Global Sauna Manufacturer

Opportunity

With growing market demands, the Chinese supplier faced three months of backorders. The client brought in ARC Consulting as an independent third-party to help the supplier identify their current real capacity and the maximum capacity of the factory, and then help the supplier develop an action plan to solve the capacity challenge.

Approach

ARC Consulting finished the project through three steps:

1. On-site supplier evaluation

ARC Consulting’s consultants spent four weeks on-site in the supplier’s factory to get a comprehensive understanding of the product’s processing flow and real capacity for each production step. ARC Consulting conducted three key steps on-site:

• Face-to-face interviews with key persons from the production line, such as the production manager, team leader of each production step
• Analyze past months’ production plan
• Evaluating each machine and employee production efficiency, as well as the factory’s space measurement

2. Analysis

After the sufficient data collection, ARC Consulting helped the supplier calculate their daily, weekly, and monthly capacity. Further, a simulation to reflect the capacity changes based on the numbers of employees and machines were conducted. ARC Consulting delivered a mid-term report to the client, including a capacity improvement plan for short and long term as well as a factory re-layout. The final action plan was discussed and determined with the supplier and the client.

3. Action plan implementation

ARC Consulting’s consultants worked together with the supplier to implement the designed action plan during a one-month pilot production period. Weekly factory visits were conducted during the pilot period to ensure an efficient workflow.