China Supply Chain Assessment for a Swedish Phone Accessory Company
The client, a leading Swedish phone accessory company, has been growing fast in past years and they expected a significant growth in the coming years. As a result, a need to strengthen their supply chain management was necessary.
With the goal being set, the client turned to ARC Consulting to provide professional service for their Chinese supplier base assessment, to identify supply chain risks and saving opportunities, as well as improve the overall supplier management process.
ARC Consulting arranged in-depth on-site supplier audits at the client’s current suppliers, and conducted a detailed market study for relevant products. A comprehensive analysis was presented to the client, including product cost breakdown, price benchmarking, potential risk identification and mitigation.
The project consisted of three steps:
- Data gathering & market research
- Data analysis & price benchmark
- Supplier negotiation & contract signing
First, ARC Consulting collected spend data from both the client and the suppliers, visited existing suppliers, as well as conducted a thorough market research to understand the available supplier alternatives for each product on the market.
Second, ARC Consulting conducted cost analysis of each of the products supplied by current supplier, as well as invited potential suppliers for quotation after gaining deep understanding of their operations and capabilities. A comprehensive price comparison was presented thereafter.
Finally, a proposed negotiation plan was prepared for the client’s review and approval. ARC Consulting participated in negotiations with the client and prepared a formal contract to be signed by both parties.
A formal purchase contract was signed after the commercial negotiations. Cost saving would be generated from some areas and products, that benefitted the client overall.
With ARC Consulting’s assistance, the client has improved their daily purchase order management, supplier selection & management process, and contract management. They have received the relevant professional tools to continually improve their supply chain in China.
A list of high potential and competitive suppliers were selected and recommended to the client. Thanks to the enhanced knowledge of the process and available suppliers, more saving opportunities can be explored.
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