Dragon Sourcing - éž™ ćş? Delivering sustainable sourcing value from emerging markets
Roll Container Case Study
Agenda
Š 2017 Dragon Sourcing. All rights reserved.
1.
Objectives
2.
Product specifications
3.
Approach
4.
FOB prices
5.
DDP prices
2
Objectives and approach DS Approach consists in the following work steps:
Context
1. Demand Analysis: Work with the Company to define and understand the products and requirements (specs, volumes, materials, production technology requirements) 2. Supply Market Analysis : Identify long list of potential suppliers in the selected markets 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/RFP process by telephone pre-screening based on agreed simple criteria (e.g. capability to make the product, minimum company size, interest in participating) 4. Administer the NDA: NDA template authorized by Vossloh that will be distributed to the suppliers who is willing to attend the RFI-RFQ 5. Develop RFI/RFQ : Prepare an RFI/RFQ document, with an aligned Balanced Scorecard that has the objective to pre-qualify the competitiveness and capabilities of the suppliers, including: Background, financial, Client and product experience, Quality certification & processes, Social Responsibility, Manufacturing/technology capability, R&D capability. 6. Conduct RFI/RFQ Administration : The RFI/RFQ is translated to the local languages as relevant, and distributed to the relevant suppliers, with telephone follow-up to push for maximum participation. 7. Analyze RFI/RFQ Responses : Analysis of RFI/RFQ responses, estimation of logistics costs, and preparation of a report which profiles & objectively ranks the suppliers by capability and competitiveness, including a recommendation for those to be audited.
Objectives: • Identify new potential competitive suppliers. Categories: • Roll Container Geographical scope: • China, India, Thailand, Poland, Slovenia, Turkey and Italy Deliverables: • Supplier database • RFI-RFQ template • RFI-RFQ analysis report • Supplier Profiles and recommended suppliers for Client to audit
© 2017 Dragon Sourcing. All rights reserved.
3
Agenda
Š 2017 Dragon Sourcing. All rights reserved.
1.
Objectives
2.
Product specifications
3.
Approach
4.
FOB prices
5.
DDP prices
4
Roll Container Specification Product Name
CC-ROLL CONTAINER
Weight
30.5kg
Carrying Capacity
500kg UDL
Steel Quality
hot-rolled, pickled material in quality
Coating
hot dip galvanized, thickness of zinc according to DS/ISO 1461 class C.
Annual Volume
10,000 units
Annual Purchasing Spend
690,000 EURO
Dimension
HS code dedicated to customs clearance
871680000000H
Customs rate (based on CIF value)
1.7%
Š 2017 Dragon Sourcing. All rights reserved.
Product Picture
Agenda
Š 2017 Dragon Sourcing. All rights reserved.
1.
Objectives
2.
Product specifications
3.
Approach
4.
FOB prices
5.
DDP prices
6
Since wire shelving and roll container are in the same industrial field, we used our current screened wire shelving database, plus identified 22 additional roll container suppliers for this project and collected 10 FOB quotations
Selection of potential suppliers
34 suppliers
22
Pre-selected suppliers
Sending & follow up of the RFQ
Criteria Products category Export experience
Reasons for not responding to the RFQ No ressources available No manufacturing capabilities No interest for this project
21 suppliers
Total 10 suppliers’ quotation received
18
7
12
1st Supplier List
3
3
Selected Supplier for RFQ
Collected Quotation
Wire Shelving Supplier © 2017 Dragon Sourcing. All rights reserved.
Analysis of the suppliers’ offer
Roll Container Supplier
The pre-selected suppliers are mainly located in the Jiangsu province (4) and Shanghai (4), the remaining ones are in Guangdong (1) and Zhejiang (1)
Supplier name
Province
City
1
Jiangsu
Changshu
2
Jiangsu
Changshu
3
Shanghai
Shanghai
4
Shanghai
Shanghai
5
Guangdong
Shenzhen
Heilongjiang
Jilin Liaoning Hebei Gansu
6
Jiangsu
Suzhou
7
Zhejiang
Yiwu
8
Shanghai
Shanghai
9
Shanghai
Shanghai
10
Jiangsu
Suzhou
BEIJING
Neimongu
Shanxi
Ningxia Gansu
Shandong Shanghai Jiangsu: 4 suppliers
Henan
Shaanxi
SHANGHAI: 4 suppliers Anhui
Hubei
Sichuan
Zhejiang: 1 supplier Jiangxi
Hunan
Fujian
Guizhou Yunan
Guangxi
Guangdong: 1 supplier HONG KONG
Š 2017 Dragon Sourcing. All rights reserved.
Agenda
Š 2017 Dragon Sourcing. All rights reserved.
1.
Objectives
2.
Product specifications
3.
Approach
4.
FOB prices
5.
DDP prices
9
Synthesis of the collected quotations: FOB EURO price per units
Supplier Name
Province
City
FOB Price in US$ per Unit
FOB Price in EURO per Unit
1
Jiangsu
Changshu
US$82.00
€ 64.79
2
Jiangsu
Changshu
US$67.50
€ 53.33
3
Shanghai
Shanghai
US$66.88
€ 52.84
4
Shanghai
Shanghai
US$77.00
€ 60.84
5
Guangdong
Shenzhen
US$95.00
€ 75.06
6
Jiangsu
Suzhou
US$53.75
€ 42.47
7
Zhejiang
Yiwu
US$37.50
€ 29.63
8
Shanghai
Shanghai
US$47.00
€ 37.13
9
Shanghai
Shanghai
US$31.25
€ 24.69
10
Jiangsu
Suzhou
US$80.75
€ 63.80
US$63.86
€ 50.86
Average
© 2017 Dragon Sourcing. All rights reserved.
Synthesis of the collected quotations: FOB EURO price per units Wire Shelving pre-selected suppliers Already visited plant and audited by DS Provided samples for the wire shelving project
Pre-selected Suppliers © 2017 Dragon Sourcing. All rights reserved.
Agenda
Š 2017 Dragon Sourcing. All rights reserved.
1.
Objectives
2.
Product specifications
3.
Approach
4.
FOB prices
5.
DDP prices
12
The DDP price is calculated by adding to the FOB price, the transportation costs, the customs duties, the CIF ROTTERDAM value and the inland transportation (Holland)
EXW Pric e
Loading on container on manufacturing site
Sea freight from Shanghai (China) to Le Havre (France)
Container transportation to Port
Additional fees (BAF & CAF)
Export documents expenses, transporation & other taxes Handling & loading of the container on the vessel
Suppliers’ quotation © 2017 Dragon Sourcing. All rights reserved.
FOB Price
Insurance cost based on the FOB value, plus the transportation cost
Port handling cost Loading cost on truck Port taxes Transportation Customs clearance cost to final fees destination Fuel taxes
DDP Pric e
Logistics flow from FOB CHINA port to DDP ZAANDAM (THE NETHERLANDS)
Roll Container Packing Information
Product Name
CC-ROLL CONTAINER
Number of pieces per box
1
Carton box size LxDxW (mm)
1800*200*850
Pallet size (mm)
1100*850
Number of pieces in a 20' container with pallet (approximate)
100
Number of pieces in a 40' container with pallet (approximate)
200
HS code dedicated to customs clearance
871680000000H
Customs rate (based on CIF value)
1.7%
Š 2017 Dragon Sourcing. All rights reserved.
Logistics cost from FOB CHINA (Port) to DDP ZANDAAM storage (HOLLAND) Description of the different logistics operations from FOB CHINA Port to ZAANDAM warehouse (HOLLAND)
Container 20’
Sea freight cost from FOB SHANGHAI to CIF ROTTERDAM (HOLLAND)
€735
BAF cost (Bunker Adjustment Fee)
€240
CAF tax (Currency Adjustment Fee) 6.10% to apply on the freight cost of a container
€44
Administrative, Handling & Security charges at the Port of Origin (CHINA)
€84
Total freight cost from FOB SHANGHAI to CFR ROTTERDAM (FRANCE)
€1,103
Handling fees & administrative costs at the container arrival at ROTTERDAM (HOLLAND) International Ship & Port Facility Security Surcharge
€15
Documentation Fee & Administrative cost at Destination
€40
ROTTERDAM Terminal Handling Charge
€138
Total cost of the port & administrative taxes at ROTTERDAM Port (HOLLAND)
€193
Freight cost from ROTTERDAM to ZANDAAM (storage)
€270
Total transportation from FOB CHINA Port to ZANDAAM (storage) Quantity of Roll Container per container (in units)
© 2017 Dragon Sourcing. All rights reserved.
€1,566 100
Synthesis of the collected quotations: DDP ZAANDAM EURO price, based on 20’ container freight cost US$ FOB price / unit
EURO FOB price / unit
Freight cost based on a 20’ container / unit
CIF price
City
Customs duties based on CIF value
Inland transport
DDP unit price
Jiangsu
Changshu
US$82.00
€64.79
€11.03
€75.82
€1.29
€4.63
€81.74
2
Jiangsu
Changshu
US$67.50
€53.33
€11.03
€64.36
€1.10
€4.63
€70.09
3
Shanghai
Shanghai
US$66.88
€52.84
€11.03
€63.87
€1.09
€4.63
€69.59
4
Shanghai
Shanghai
US$77.00
€60.84
€11.03
€71.87
€1.22
€4.63
€77.72
5
Guangdong
Shenzhen
US$95.00
€75.06
€11.03
€86.09
€1.46
€4.63
€92.18
6
Jiangsu
Suzhou
US$53.75
€42.47
€11.03
€53.50
€0.91
€4.63
€59.04
7
Zhejiang
Yiwu
US$37.50
€29.63
€11.03
€40.66
€0.69
€4.63
€45.98
8
Shanghai
Shanghai
US$47.00
€37.13
€11.03
€48.16
€0.82
€4.63
€53.61
9
Shanghai
Shanghai
US$31.25
€24.70
€11.03
€35.73
€0.60
€4.63
€40.96
10
Jiangsu
Suzhou
US$80.75
€63.80
€11.03
€74.83
€1.27
€4.63
€80.73
US$63.86
€50.46
€11.03
€61.49
€1.04
€4.63
€67.16
€4.63
€69.00
Supplier
Province
1
Average Current price
Quotation from pre-selected wire shelving suppliers
© 2017 Dragon Sourcing. All rights reserved.
Quotation lower than current AHOLD DDP price 1 US$ = 0.7901 Euro dated September 11th 2006
Synthesis of the collected quotations: DDP ZAANDAM EURO price, based on 20’ container freight cost
Š 2017 Dragon Sourcing. All rights reserved.