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Battery Global Sourcing Case Study 2019
Agenda
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1.
Objectives , work plan and time line
2.
Demand Analysis
3.
Progress
2
Client is leading global digital security company, the battery sourced is used in display card.
Š 2019 Dragon Sourcing. All rights reserved.
3
Objectives and approach DS Approach consists in the following work steps:
Context
1. Demand Analysis: define and understand products and requirements (specs, volumes, materials, production technology requirements) 2. Supply Market Analysis: Identify long list of potential suppliers worldwide by leveraging B2B Websites, DS Database, Fair catalogues, Chamber of Commerce, Magazines, Network, References. 3. Telephone Pre-screening: Selection of suppliers to be included in the RFI/RFQ process by telephone pre-screening based on agreed simple criteria (e.g. capability to make the product, minimum company size, quality certifications) 4. Develop the RFI-RFQ: Document prepared together with client to pre-qualify the competitiveness and capabilities of the suppliers, including: Background, Financials, Client references and Product experience, Quality certification & processes, Social Responsibility, Manufacturing/technology capability, R&D capability 5. Administer the RFI-RFQ: Distributed to the suppliers who passed pre-screen, with telephone follow-up to push for maximum participation. 6. Develop a balance score with client, evaluating suppliers maturity according to RFI/RFQ 7. Analyze RFI-RFQ Responses: profiling & objectively ranking suppliers by capability, and recommending those to be audited. 8. Pre-audits (optional): Carry pre-audits of recommended suppliers in order to identify those to have you audit.
Objectives: • Identify new potential competitive suppliers worldwide to decrease price, secure manufacturing capacities, lead-time. Geographical scope: • Worldwide Categories: • Battery
© 2019 Dragon Sourcing. All rights reserved.
4
The project is scheduled to finish in 9 weeks. #
Step
Who
0
Kick off
Client/DS
1
Demand Analysis
Client/DS
Week0 Week 1 Week2 Week 3 Week4 Week 5 Week6 Week 7 Week8 Week 9
2
Supply Market Analysis
DS
3
Telephone pre-screening
DS
4
Develop the RFI-RFQ
5
Administer the RFI/RFQ
6
Develop balance score card to evaluate suppliers according to RFI/RFQ
Client/DS
7
Analyze responses and select suppliers for audit phase
Client/DS
Client/DS
DS
Not-started
© 2019 Dragon Sourcing. All rights reserved.
5
Started
Delayed
Finished
Milestones
Agenda
Š 2019 Dragon Sourcing. All rights reserved.
1.
Objectives , work plan and time line
2.
Demand Analysis
3.
Progress
6
Demand analysis – Battery , total annual spend USD 6M
Description
Spec
Photo
12mAh
14mAh
4,000,000
1..Thickness : 0.45mm MAX ； 2.Capacity > 12 mAh ; 3. Smart card application; 4.flexible
4,000,000
15mAh
© 2019 Dragon Sourcing. All rights reserved.
Annual quantity (pcs)
4,000,000
7
Agenda
Š 2019 Dragon Sourcing. All rights reserved.
1.
Objectives , work plan and time line
2.
Demand Analysis
3.
Progress
8
Total 49 suppliers identified from 8 countries / regions, 13 suppliers passed prescreen, 7 RFI/RFQ received . Supplier headquarter location China mainland
Taiwan
Japan
South Korea
India
US
Germany
Austria
Total
Suppliers identified
28
2
3
2
1
11
1
1
49
Suppliers passed prescreen
11
1
0
0
0
2
0
0
14
RFI/RFQ Sent
11
1
Need client info and product detail
1
2
14 1
Can’t quote until NDA signed
1
RFI/RFQ Received
1
7
7
Battery supplier RFI/RFQ Progress
30
Suppliers identified RFI/RFQ Received
28
25
Suppliers passed pre-screen
Need client info and product detail
Can’t quote until NDA signed
20 15 10 5 0
11
11 7 1 1
China mainland
2 1 Taiwan
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3 2 Japan
2
1
South Korea
1 India
9
US
1 Germany
Austria
7 RFI/RFQ received, the 7 suppliers located in 2 provinces, 6 in Guangdong, 1 in Hubei. No
Supplier name
Province
RFI RFQ
Supplier Presentation
Spec
Product Status
1
Supplier 1
Guangdong
Y
Y
Y
Mass production
2
Supplier 2
Guangdong
Y
Y
Y
Mass production
3
Supplier 3
Guangdong
Y
Y
Y
Trial production
4
Supplier 4
Guangdong
Y
Y
Y
Mass production
5
Supplier 5
Y
Y
Y
Mass production Liaoning
6
Supplier 6
Guangdong
Y
7
Supplier 7
Guangdong
Y
Hubei Xinjiang
Gansu
Y
Y Inner Mongolia
Y
Y
Shanxi
Ningxia Qinghai
Gansu
Shaanxi
Sichuan Sichuan
Jilin
Mass production Tianjin Hebei willing to develop Shandong Jiangsu
Henan Anhui
Xizang
Heilongjiang
Shanghai
Hubei Jiangxi Zhejiang Hunan Guizhou
Yunan
Guangxi
Guangdong Hong Kong
© 2019 Dragon Sourcing. All rights reserved.
10
Fujian Taiwan
Battery RFI Scorecard Business information Year Founded
Weight of criteria 10%
Net sales (USD)
Profit (USD) last 3 years
20%
15%
Business trend over the last three years
15%
Employee numbers
10%
Profile of Top Customers
15%
Provide company presentation
5%
Cooperation during the RFI/RFQ process
10%
Subtotal Production & Quality
Scoring 1=After 2010 2=Between 2000 to 2010 3=Before 2000 0=Not provided 1=Less than 10M 2=10-20M 3=20-50M 4=above 50M 0 = not provided 1 = negative 2 = positive 0=not provided 1= negative 3 = stable or growing 1=Less than 100 2=100-200 3=200-500 4=above 500 0=Not provided 1=Local customers 2=National customers 3=International customers 0=No 1=Yes 1= Poor 2= Satisfactory 3= Excellent
100% Weight of criteria
Max Score per criteria
Experience of smart card / display card
10%
Any part of the process subcontracting ?
10%
ISO 9001 & ISO14001
5%
Certificate for battery
5%
Component / product warranty term
10%
4
Intellectual property
10%
3
Intention to compete in the same market (display card)
15%
4
2
3
Subtotal 1
Time to develop solution as per client requirement
15%
Capacity
3
1= In test 2= Yes 0 = more than 6 months
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50%
2
3 1 2
3
2
Max Score per criteria
Scoring
20M
3 3= >20M
Max Score per criteria CAPEX investment capacity
20%
Standard Lead-time
30%
2
Subtotal 3
2= 1-3 months
1
2= 5M-
1= 3 - 6 months 10%
100% Weight of criteria
2
1= <5M Annual capacity of thin battery
Scoring
10%
3
0= In development Product already in production
Internal laboratory for the product
0= No (only in line control) 1 = Basic equipment 2= Full range (e.g Reliability / aging testing, chemical, XRayâ&#x20AC;Ś) 0=No 1=Yes 0 = more than 1 process 1 = 1 process maximum 2 = no subcontracting 0= none 1=ISO14001 2= ISO9001 3=Both 0=No 1=Yes 0= no warranty 1= 1 year 2= over 2 years 0= no IP 1= no IP - licence to use 2= IP locally applicable 3= own IP - no risk 0 = intent to go on the segment market 2 = OEM - component focused
11
100%
0= no 1= yes 0 = higher than current one 1= similar 2= better To compare with current BOM
1 2
Unit price comparison, three suppliers have saving 3%-12%. Unit Pirce Comparison (USD) 1.5
1.23
1.04 1
0.93 0.88 0.79
0.82
0.97
0.99
0.85
0.5
0
Current price
Supplier 3
Supplier 5
Supplier 2
Supplier 7
Supplier 2
Supplier 1
Quotations lower than current price Š 2019 Dragon Sourcing. All rights reserved.
12
Supplier 4
Supplier 6
Current price
Battery RFI Score and potential saving, 7 suppliers scored and ranked , 6 suppliers score are above 70, 3 have potential saving. RFI Score Criteria
Weight
Supplier 1
Supplier 2
Supplier 3
Supplier 4
Supplier 5
Supplier 6
Supplier 7
Business information
25%
23
23
24
19
21
19
7
Production
35%
29
32
28
28
27
27
29
Capacity
40%
40
33
33
33
27
27
33
Total
100%
91
88
86
81
75
73
69
RFI Score and Battery Unit Price comparison RFI Score Potential saving 100 90
91
88
80
14% 86 12%
81
75
70
73
12% 69
60 50
8%
7%
6%
40 30
4%
3%
20
2%
10 0
0% Supplier 2
Supplier 3
Š 2019 Dragon Sourcing. All rights reserved.
10%
Supplier 4
0% Supplier 5 13
Supplier 6
0% Supplier 7
0% Supplier 7
0%
Company profile Supplier 1 COMPANY INFORMATION XXX
Company Name Address
ULTRA THIN BATTERY PRODUCTION below 0.45mm
XXX
Town
Dongguan
Province
Guangdong
Country
China
Company Website
Monthly production capacity( pcs )
300K
XXX CONTACT PERSON INFORMATION Raymond Lau Sales Manager XXX XXX XXX XXX
Contact Person Title Email Tel Fax Mobile phone
BUSINESS INFORMATION What date was your company founded? What is your turnover in million USD?
2000
2018
2017
2016
2015
60
55
40
37
How many employees do you have? What is the percentage of turnover distributed to:
600 China
Europe
US
Rest of the World
N/A
N/A
N/A
N/A
Clients
Industry
Country
% of sales
1
XXX
Digital products
China
N/A
2
XXX
IT
Japan
N/A
3
XXX
Computer
American
N/A
Who are your top 3 Clients?
Š 2019 Dragon Sourcing. All rights reserved.
15 mAh 12 mAh ultra thin 14 mAh ultra thin ultra thin battery battery battery 200K
200k
Experience of smart card / display card
Yes
Factory location
XXX
Can your company develop according to client's requirement?
Yes
Others 300K
How long will it take to develop new design?
Not fixed, usually 30-45 days, depend on the battery configuration
How much will it cost to develop new design? (USD)
Not fixed, just depend on the customer's requests(cells, sample quantity etc) Quality
What quality and environmental registrations do you have?
Yes / No
Date of Certificate
Certifying Org
ISO 9001
Yes
2/17/2015 QA International
ISO 14001
Yes
3/1/2015
QA International
Others (please list)
OHSAS18001
2/1/2015
QA International
Please list the certificate your company has for battery. (product and transportation)
SGS, UL, CE, PSE,FCC etc
Product failure rate (ppm) What's the warranty term of your product? What is your internal rule regarding maximum reaction time of quality claim?
14
170 1 year 48 hours response
Date of Expiry