Food sourcing research in South East Asia gives a head start to one of Sweden’s biggest retailers
The company is one of Sweden’s leading companies in the low-price market segment and has been conducting sourcing activities in Asia for several years. The company were looking into expanding their food sourcing in Asia and asked ARC Consulting to screen potential suppliers and traders in multiple countries in the SEA region for multiple food products.
Supplier search and screening was conducted in the chosen markets for multiple food products. The suppliers were ranked on the pre-defined criteria, set together with the client.
The clients then met with all the short-listed suppliers and further evaluated their capabilities and product offers on-site.
Food category is typically not sourced directly from suppliers in the origin countries but from local wholesalers in Sweden and Europe. Today the client would like to expand their food sourcing in Asia and has identified potential sourcing opportunities SEA that they would like ARC Consulting to further investigate.
The client has already been conducting sourcing activities in Asia but focusing on sourcing such as textile, gardening, kitchen ware, etc. However, due to limited local know-how about the SEA markets the client asked ARC Consulting to help with supplier search and screening in the targeted markets.
Preparation: The project was initiated by a kick-off meeting between the ARC Consulting team and the client, which covered: Formulation of requirements and prerequisites for suppliers, setting review criteria, timeline, focus areas, and expected outcome.
Market Research & Master list: Supply market research was then conducted to build a master list of potential manufacturers and traders, using both ARC Consulting’s own database and external sources.
Supplier Evaluations: The suppliers were then screened and evaluated to initially confirm production capability of targeted products and motivations. RFI & RFQ were collected from all the suppliers.
Meeting Arrangement & Recommendations: A final report including Supplier Short List and recommendations for next steps were conducted as well as organized supplier meetings on-site for the client.
Supplier search and screening was conducted for two markets in SEA, and in total 9 suppliers made it onto the Supplier Short List, and they were ranked by three levels of priority based on pre-defined criteria.
During the supplier screening process, it was noticed that one market had a stronger supply market for the export of the targeted food products. The other market was not as strong, and none of the suppliers from this country were included in the Short List.
It was suggested that the client should meet with all the 9 suppliers and further evaluate their capabilities and product offers on-site.
Based on the provided information by ARC Consulting, the client decided to follow the outlined recommendations and meet with all 9 suppliers. The client has started negotiations with multiple suppliers that ARC Consulting recommended.