Cooling Towel Sourcing Project​ ​- Case Study​

Dragon Sourcing - 龙源 Delivering sustainable sourcing value from emerging markets

Cooling Towel Sourcing Project Case Study

Agenda

Sourcing Project Introduction

Sourcing Approach

Conclusions

Objectives and approach Dragon Sourcing approach in 3 stages:

Context Client Introduction: • Client is leading German Company providing corporate gifting for their clientele in Europe.

Stage 1: Supplier Pre-Qualification Stage 2: Selection & Contracting

Project Objectives: • Shortlist potential suppliers from DS existing supplier database manufacturing microfiber towels.

Stage 3: Procurement Operations Deliverables under stage 1 • RFI-RFQ template • RFI-RFQ analysis report • Manufacturer profiles with rankings including factory and product pictures. • DS Recommendation on next steps

Category Microfiber Cooling towel Geographical scope: China.

Agenda

Sourcing Project Introduction

Sourcing Approach

Conclusions

Following STEPS were covered for end to end sourcing,

Supplier Pre-Qualification •

Key activities

•

Demand analysis to define and understand the product and key requirements Supply analysis to identify list of potential suppliers

•

Telephone pre-screening based on agreed simple criteria

•

Develop RFI/RFQ template

•

Conduct RFI/RFQ administration

•

Analyze RFI/RFQ responses and issue RFI-RFQ report

•

Recommend suppliers for next phase

Procurement Operations

Selection & Contracting

•

Recommend suppliers for sampling

•

Send original samples to the preshortlisted suppliers.

•

Manage P/O and agree payment terms and details.

•

Check in process production quality

•

Conduct pre-shipment QC

Sample development from final list of suppliers & testing. • Negotiation, contracting and final selection.

PHASE 2

Arrange logistics

•

Manage payments

•

Manage supplier performance

•

Monitor new sourcing opportunities

PHASE 3

Supplier qualification & selection process was completed in 6 weeks, Steps

Week 1

Week 2

Week 3

Week 4

Week 5

Week 6

1. Demand Analysis

2. Supply Market Analysis 3. Telephone Pre-screening 4. Develop RFI/RFQ 5. Administer RFI/RFQ Supplier profiles with recommendations.

6. Analyze RFI/RFQ Responses

7. Original sample sent to shortlisted suppliers Samples developed and approved.

8. Sample developed from shortlisted suppliers.

Demand Analysis, - Quotes were collected based on solid color and printed design with volume as per min 10,000 PCS to maximum 80,000 PCS.

Product name

Product picture

Material

Instant Cooling Microfiber Towel

Material: 55% Polyamide & 45% Polyester and

Solid Colors

Description

• • •

Size 100 x 30 cm, GSM 170 Weight 52 gram of the towel

Estimated pilot order quantity

80,000 PCS

• Packaging: Single packing a in plastic zipper bag. • Instant Cooling Microfiber Towel

Material: 60% Polyamide & 40% Polyester

Overall Digital Print

Plastic Packaging + Carabiner in towel color with rounded edges and Inlay Card with product information

• Special Function: Loop to hang up the towel and can also be used as care label

80,000 PCS

â&#x20AC;&#x2019; As a first step, potential suppliers were shortlisted from existing DS database.

‒ Pre-screening process was initiated after receiving client validation, ‒ This process was to filter the list of identified suppliers prior moving them to the RFI-RFQ step. Suppliers “Must have” criteria to pass pre-screening.

Post pre-screening the suppliers, RFI-RFQ process was administered to filter out most capable suppliers.

â&#x20AC;&#x2019; Category specific technical questions were added in the RFI relevant to the to understand supplier production capability and capacity.

Suppliers Assessment, Suppliers were assessed and ranked based on the Company profile, Scoring and ranking of the suppliers are done on the GSP,

Shortlisted

Could be considered Not shortlisted

RFI Result chart: All markets, All sections 100

RFI score

100% 79% 80

69% 78

69%

67%

61%

58%

RFI filling rate

75% 61

53 50%

28 25%

0% China Supplier 4

China Supplier 1

China Supplier 3

China Supplier 9

China Supplier 2

China Supplier 6

China Supplier 10

Certificate,documents and pictures

Social responsibility

Quality management

Production

Business information

RFI Score

RFI filling rate

Manufacturer locations were highlighted in the map No

Supplier name

City

Province

Country

1 2 3 4 5 6 7 8 9 10

Supplier 1 Supplier 2 Supplier 3 Supplier 4 Supplier 5 Supplier 6 Supplier 7 Supplier 8 Supplier 9 Supplier 10

XX XX XX XX XX XX XX XX XX XX

China China China China China China China China China China

Shortlisted Could be considered Not shortlisted

Location of the Suppliers Marked

Shortlisted Could be considered

RFQ – Price Analysis - Price were collected based on min 10,000 PCS and maximum 80,000 PCS.

Not shortlisted

Supplier name

Supplier 1

Supplier 2

Supplier 3

Supplier 4

Supplier 5

Supplier 6

Supplier 7

Supplier 8

Supplier 9

Supplier 10

Country

China

Product name

Dimension in cm (L x W) & Weight

Order qty in PCS

FOB Price in $US/PC

10,000 PCS

80,000 PCS

10,000 PCS

80,000 PCS

Instant Cooling Microfiber Towel Solid Colors 100 x 30 cm. Net weight 52 gram 170 GSM Instant Cooling Microfiber Towel Overall Printed

Recommended suppliers

RFI Score

RFI Ranking

Supplier company profiles as per ranking wise was shared in the final RFQ report with recommended suppliers for moving them to next phase of sampling.

Phase 2: Suppliers were selected for sampling process.

Supplier Pre-Qualification •

Key activities

•

Demand analysis to define and understand the product and key requirements Supply analysis to identify list of potential suppliers

•

Telephone pre-screening based on agreed simple criteria

•

Develop RFI/RFQ template

•

Conduct RFI/RFQ administration

•

Analyze RFI/RFQ responses and issue RFI-RFQ report

•

PHASE 1 for next Recommend suppliers phase

Procurement Operations

Selection & Contracting

•

Recommend suppliers for sampling

•

Send original samples to the preshortlisted suppliers.

•

Manage P/O and agree payment terms and details.

•

Check in process production quality

•

Conduct pre-shipment QC

Sample development from final list of suppliers & testing. • Negotiation, contracting and final selection.

PHASE 2

Arrange logistics

•

Manage payments

•

Manage supplier performance

•

Monitor new sourcing opportunities

PHASE 3

- High quality printed samples were developed from the shortlisted suppliers within short period of time, - Contract was awarded to the supplier with sample approved and after final negotiation.

Phase 3: Post PO management was agreed with the client.

Supplier Pre-Qualification •

Key activities

•

Demand analysis to define and understand the product and key requirements Supply analysis to identify list of potential suppliers

•

Telephone pre-screening based on agreed simple criteria

•

Develop RFI/RFQ template

•

Conduct RFI/RFQ administration

•

Analyze RFI/RFQ responses and issue RFI-RFQ report

•

PHASE 1 for next Recommend suppliers phase

Procurement Operations

Selection & Contracting

•

Recommend suppliers for sampling

•

Send original samples to the preshortlisted suppliers.

•

Manage P/O and agree payment terms and details.

•

Check in process production quality

•

Conduct pre-shipment QC

Sample development from final list of suppliers & testing. • Negotiation, contracting and final selection.

PHASE 2

Arrange logistics

•

Manage payments

•

Manage supplier performance

•

Monitor new sourcing opportunities

PHASE 3

- Proforma Invoice was raised to the client under buy/resell model, - Purchase order was awarded to the shortlisted supplier post negotiation, Proforma Invoice

Purchase Order

- Production schedule was shared with the client with regular update on each of process and sample validation. TOTAL ORDER QTY: 80,000 PCS Production Schedule follow up Activity Name

Process dates

Purchase Order Received Date Fabric / Yarn Purchase Start Fabric / Yarn Purchase End PP sample QC Raw Materials Production Start Date Colour Approval First Piece Approval - Fabric Knitting End dt Fabric Cutting Start Date Cutting End date Trims- wash care label Start date Trims- wash care label complete date Zipper bag - Start date Zipper bag - complete date Carabiner Start date Carabiner complete date Trims & Accessories Approval Submission to Buyer Trims & Accessories - Approved Date from Buyer Trims & Accessories Bulk Order Date(Stitching and Packing) Trims & Accessories Bulk Order Received Date

XX XX XX XX XX XX XX XX XX XX XX XX XX XX XX XX XX

Process

Projected Completion Actual Completion date date

Fabric knitting

Submit for approval

XX XX XX

Kniting

Fabric cutting

Trims & Accessories

Sample testing

Stitching process

Already approved XX XX

Production Inspection at 20% (16,000 PCS)

Test Sample Submission to Int.LAB Testing Report From Int LAB Stitching Start Stitching 1 st pcs Stitching end Packing Start Packing End Final Inspection

XX XX XX XX XX XX XX XX

Packing List Information

Packing

Final Inspection

Packing List Information

Shipment date (80000 PCS)

Ex-factory shipment date

Container loading Supervision

Inspection

Billing/Documentation

Documents sending date

ETD Date by Train ETA Germany

XX XX

Cut-off delivery date

XX XX

- Bulk fabric was tested to check several parameters including colour fastness & composition percentage.

- Final QC inspection and container loading supervision with third party was arranged by Dragon Sourcing and results were PASSED.

Agenda

Sourcing Project Introduction

Sourcing Approach

Conclusions

Conclusions  Supplier qualification and sampling process was completed within 6 weeks.  High quality samples were developed following original sample within a short period of time.  Shortlisted suppliers for sampling were credential with the Oeko-tex certification and production capability as per client mandatory requirement.  Shortlisted supplier was awarded with the contract post price negotiation, production lead time, payment terms and others.  Overall based on DS strategic sourcing process, It helped client to place order on time with high savings and samples to showcase.

•

Dragon Sourcing provide and end-to-end service from Procurement Intelligence through to Procurement Operations

Cooling Towel Sourcing Project​ ​- Case Study​

Cooling Towel Sourcing Project - Case Study