Case Study-Water Treatment Solution Service Sourcing Indonesia Sourcing Project by john williams

Your Tailored Sourcing Approach to LCC Sourcing

Water Treatment Solution Service Sourcing Indonesia Sourcing Project Case Study Sep 2014 1

Agenda 1. Indonesia Background 2. Service Sourcing (Water Treatment Solution) Case Study 1. Background & Project Approach 2. Approach & Schedule 3. Demand Analysis 4. Supplier Sourcing Response 5. RFI/RFQ Analysis 6. Supplier Scorecard 7. Recommendations and Next steps 3. Chemical Sourcing (Defoamer) Case Study 1. Background & Project Approach 2. Approach & Schedule 3. Demand Analysis 4. Supplier Sourcing Response 5. RFI/RFQ Analysis 6. Supplier Scorecard 7. Recommendations and Next steps 4. Results

1. Background: Indonesia Overview 350

USD/ Month in 2014

303.8

318

300 236

250 200 150

131

145

100 50 0 HCM, Vietnam Jakarta, Indonesia

KL, Malaysia

Shenzhen, China

Manila, Philippines

 Indonesia has a population of 50 Million with 10M concentrated in the capital city of Jakarta  Indonesia’s workforce is observed to be one of the cheapest labors forces in in the emerging markets of South East Asia with a GDP of 1,925 USD lower than China, Philippines, & Malaysia  Majority of the workforce is employed in the Primary Sector including Agriculture, Fishery and Forestry.  Pro-growth policies during the years 2006-2011, secondary sectors (construction, Trade, Manufacturing) to reach over 40% of GDP.

Growth (2015)

Gross Domestic Product

4.8%

Value (2015) 890 Billion USD

-3.5% YoY

176 Billion USD

3% YoY

26 Billion USD

Sources: Key Indicators of Indonesia-2011 Asian development Bank-ADB

1. Background - Indonesian Chemicals Suppliers Organic Chemicals Supplier Locations

 1,500 Organic chemicals factories are in: • Riau (Sumatra) • Banten • Jambi (Sumatra) • Sumatra • Lampung (Sumatra) • Kalimantan • Papua

Source: International Trade Centre & Dragon Sourcing Supplier Survey

1. Background: Overview of Indonesia Demand Analysis

Commodity

Annual Vol (Tons)

Annual Spend (K Euros)

Sulfur

77,500

9,588

CS2

24,000

13,400

Zinc Ingot

1,160

1,770

Defoamer

373

1,080

TIO2

478

1,050

18,000

1,450

170

480

5,471

910

Filters

700

Pumps

300

Transmission Products

427

Pipes & Fittings

828

Standard Tools & Parts

256

Packaging

1,814

Automation & Switches

379

Service Contract

4,600

127 K Tons

39,032 K Euros

Quicklime Water Solutions Commodity H2O Chems

2.1 Background: Client and Project Approach DS Strategic Sourcing Approach

Context •

Water Treatment Solutions Sourcing Objectives • Our client a large Chemical Company in Indonesia spends 1.4M Euros on Water Treatment with 480K Euros on Water Treatment Solutions with a single supplier (including Providing Specialty Chemicals, Consulting Services, & Day to day management of Water systems) • To Address the 1.4M Euros in spend DS on Water Treatment the project was split into two projects 1.Water Treatment Solutions – 480K Euros Service Scouring 2.Commodity Water treatment – 918K Euros Chemical Sourcing

•

• DS will preform a standard RFI/RFQ process to identify high quality suppliers worldwide with local Indonesian support to expand / challenge the supply base

• •

Geographical scope: Target Countries of sourcing: • World wide, China, Japan, USA, Indonesia, Singapore, etc.

•

Deliverables: • RFI / RFQ and Score Card • Supplier profiles • Audit reports

•

• •

Demand Analysis Jointly develop with Client clear understand of requirements, spend, volume, specs, etc. Identify list of potential suppliers globally to include in the RFI / RFQ process by leveraging the web, external databases and various networks of experts Develop the RFI/RFQ – jointly with Client to include all key supplier qualification criteria (e.g.: financial, technology, manufacturing and services capability, corporate responsibility, quality, etc.) and quotation requirements Administer the RFI/RFQ process to ensure as high return rate as possible including quotation, and credentials’ visible outlets from supplier Analyze responses and use balance score card developed together with Client management team to rank and recommend suppliers which Client needs to take through a formal qualification process Jointly develop with Client the structure of the audit report Jointly develop or modify contract contents based on needs (when it is needed). Carry out audits (when relevant) (either alone or jointly with Client auditors or buyers) of the suppliers that appear attractive and competitive based on the RFI/RFQ process Issue audit reports (when relevant) and rank suppliers based on audit and price competitiveness Recommend which suppliers to move for sampling (when relevant) Based on samples quality (when relevant), select suppliers with who to enter into final contract negotiations and provide support to the contract negotiation process

2.2 Demand Analysis: Water Treatment Solution (1/5) Do to the complexity of the service the requirements must be clearly defined by.. .

• Build a multi discipline Project Team since no 1 department or person has full knowledge of requirements • Collet Data Collection documents from global Water Treatment Solution providers using this collection process to shortlist Suppliers that can provide local support in Indonesia, Merge Data collection documents to ensure that all key details are provided to all suppliers • Full Technical Diagrams of all water Systems (Boilers, Cooling Towers, Waste Water Boilers)

• Full Technical Specs of Boilers, Cooling Towers, etc • Details of Water Chemicals Usage, Function, Quantity, Input Points, etc. • Requirements on Incoming & outgoing Water/Steam from each system • Details of Water testing regime, Key reports, and data required by production

2.2 Demand Analysis: Data Collection Documents(2/5) Boiler X Page 1 of 3

Boiler X Page 2 of 3

Boiler X Page 3 of 3

Fully defined Specs and Requirements were 100+ pages

2.2 Demand Analysis: Water System Diagrams (3/5) Waste Heat Boiler

Diagram Plant Boiler House

COOLING TOWER

# Bar dege C 1 3 1 3 1 1 1 1 1

75 45 45 10 22 22 22 22 55

490 450 450 200 240 240 240 240 450

Steam ton/hr 130 22 45 70 28 10 14 12 40

Location

Dearator 1

Power plant Boiler House

Chemical Plant

1 1 1 1 1 1 1

2.2 Demand Analysis: Spend & Chemical Details (4/5)

Chemical 1 Chemical 2 Chemical 3

Kg Kg Kg

2013 Cons ( Ton ) 4.01 3.52 0.92

Chemical 4

7.14

15,882

Chemical 5 Chemical 6

Kg ??

2.65 ??

5,696 ???

Product Name UoM

Chemical 7

1.30

Yearly Spend (K Euros) 7,982 7,640 3,221

2,970

DESCRIPTION

MICROCIDE FOR COOLING TOWER ALGAECIDE FOR COOLING TOWER BACTERICIDE FOR CLOSED SYSTEM CORROSION & SCALE PREVENTIVE FOR COOLING TOWER CORROSION INHIBITOR FOR CLOSE SYSTEM FUEL OIL ADDITIVE

Program / Solution Utility Area Program Utility Area Program Utility Area Program Utility Area Program Utility Area Program Utility Area Program

Condensate Treatments, A Neutralizing amine effective in the initial and extended areas of complex condensate system

I. CHEMICAL PROGRAM

Condensate Treatments, A Neutralizing amine effective in the initial and extended areas of complex condensate system

I. CHEMICAL PROGRAM

Chemical 8

1.68

1,619

PH adjustment, low freeze alkalinity source

I. CHEMICAL PROGRAM

Chemical 9

2.58

3,452

Internal treatments, can be used as a residual phosphate programs

I. CHEMICAL PROGRAM

Organic corrosion inhibitor used for scavenging oxygen and passivating metal surfaces

I. CHEMICAL PROGRAM

Chemical 11

0.33

1,172

Organic corrosion inhibitor used for scavenging oxygen and passivating metal surfaces Organic corrosion inhibitor used for scavenging oxygen and passivating metal surfaces organic, film-forming, liquid copper corrosion inhibitor

Chemical 12

1.00

2,108

Non oxidizing Biocide

Chemical 10

1.55

4,282

I. CHEMICAL PROGRAM

i. Boiler Chemical Program ii. Cooling Tower Chemical Program ii. Cooling Tower Chemical Program

2.2 Demand Analysis: Spend & Chemical Details (5/5) Product Name Chemical 13

Chemical 14

UoM

2013 Cons ( Ton )

Yearly Spend (K Euros)

0.25

2,246

4.65

12,917

Chemical 15

5.57

13,065

Chemical 16

13.88

43,682

Chemical 17

0.53

818

Chemical 18

5.65

17,325

Chemical 19

30.74

116,689

Chemical 20

0.94

5,098

Chemical 21 Chemical 22 Chemical 23

Kg Kg Kg

56.28 11.27 13.57

PAC

NaCl

DESCRIPTION non-ionic surfactant/dispersant for removing and dispersing microbiological slime deposits All organic scale and corrosion inhibitor designed for use in systems with recirculating water calcium concentrations greater than 300 ppm (as CaCO3) at the targeted cycles when the pH is typically greater than 8.7 Corrosion and scale inhibitors designed for use in open recirculating water systems. All organic scale and corrosion inhibitor designed for use in systems with recirculating water calcium concentrations greater than 300 ppm (as CaCO3) at the targeted cycles when the pH is typically greater than 8.7 Coordinated phosphate program for boiler internal treatment for scaling inhibitor and pH Buffer Neutralizing, Condensate Treatment Program

Program / Solution ii. Cooling Tower Chemical Program

ii. Cooling Tower Chemical Program

F. V Department Program

i. Boiler Chemical Program i. Boiler Chemical Program

Scale inhibitor, particulate & sludge dispersant is a corrosion inhibitor that contains a blend of low and high volatility amines designed for use in steam and condensate systems

i. Boiler Chemical Program

low charge, cationic, dry flocculant designed as a dewatering polymer

ii. Cooling Tower Chemical Program

Coagulant - Water Treatment

Unclear

136,401 26,739 49,035

AntiFoam - Waste Water Treatment Coagulant (Pos) - Waste Water Treatment Coagulant (Neg) - Waste Water Treatment

Unclear

462.62

67,667

Coagulant - Water Treatment

Commodity Water treatment Chemicals Project

3,214.00

265,381

Resin (Add Ions to water) - Water Treatment

Commodity Water treatment Chemicals Project

TSP

828.00

296,055

Nutrients - (Feeding Bacteria) - Waste Water Treatment

Commodity Water treatment Chemicals Project

UREA

966.90

288,885

Nutrients - (Feeding Bacteria) - Waste Water Treatment

Commodity Water treatment Chemicals Project

Total;

1,398,028

ii. Cooling Tower Chemical Program

Unclear Unclear

2.3 Approach & Schedule Not started In process Project Activity Week No.

Done Note that the schedule maybe impacted by the time taken to collect category specifications, gain deliverable Delay validation, short list suppliers, produce samples & test samples. July, 2014

August,2014

September 2014

1. Demand Analysis 2. Supply Market Analysis 3. Telephone Prescreening 4. Develop RFI/RFQ and Scorecard 5. Conduct RFI/RFQ Administration

Ramadan Holiday

RFI/RFQ & Scorecard approved

(HARI RAYA PUASA & CURI BERSAMA)

6. Analyze RFI /RFQ Responses 7. RFI /RFQ Report & Recommendations

RFI/RFQ Analysis Report Finished

Today

2.4 Supplier Sourcing Response: Water Treatment Solutions 60

2 3 4

20 26

1 0 1 1

6 1 1 3

Passed Phone Interviews

Sent RFI/RFQ

Replied to RFI/RFQ

0 Suppliers Identified

Phone interview completed Indonesia

China

Singapore 14

Japan

USA

Others

Visited/ Audited

2.5 RFI/RFQ Analysis:

64.1 % 170.9 K

Current

Supplier 1

64.1% 170.7 K

Supplier 2

63.9% 170.4 K

Supplier 3

52.3% 139.4K

Supplier 4

44.3% 118.K

Supplier 5

10.6% 28.2K

Supplier 6

2.6 Balanced Scorecard Location in RFI/RFQ

Weight of criteria

Manufacturer or distributor/trader/agent

1-1

20%

1= distributor/trader/agent 2= Manufacturer

Years of foundation

2-1

20%

1＜ 5years 2 = 5 -10 years 3= 11-20years 4= >20 years

Ownership (State Owned/ Private/Foreign Investment)

2-2

15%

1= Private owned 2= State owned 3= Foreign investment

How many employees do you have?

2-3

20%

1< 10 2= 10 – 20 3= 20-50 4= > 50-100 5=>100

Turnover in 2013 in Million USD

2-4

25%

1= <1M 2= 1M-5M 3= >5M-20M 4=>20M-50M 5=>50M

Do you have an export license? (Y/N)

3-1

15%

0= No 1= Yes

How many years of export experience do you have?

3-2

20%

0=0 1=< 5 2= 5-10 3=11-20 4= > 20

Have you exported or sold to Indonesia before?

3-3

15%

0= No 1= Yes

Do you have office/branch In Indonesia?

3-4

15%

0= No 1= Yes

15%

0= No 1= Yes 2= Yes , listed

3-6

20%

0= No/NA 1= Yes 2= Yes , listed

Total supply of Automation & Switch (pcs / year) in 2013.

1-4

40%

1= ＜1000 2=1000-3,000 3= 3,001-10,000 4＞10,000

Main supplying brands listed

1-5

30%

0= No 1= Yes, local 2= Yes, international

Do you have your own storage house?

2-5

30%

0= No 1= Yes

Do you have ISO9001?

4-1

20%

0= No 1= Yes

Do you have ISO14001?

4-2

20%

0= No 1= Yes

Do you have any other industrial certificates ?

4-3

20%

0= No 1= Yes 2= Yes , listed

Quality guarantee policy described

4-4

20%

0= No 1= Yes

4-5

20%

0= No 1= Yes

RFQ

100%

0= <0% 1= <6% savings 2=6%-15% savings 3= 16%-30% Savings 4= ＞30%

100%

0= Poor 1= Satisfactory 2= Excellent

Company background

Scoring

Max Score per criteria

Weight of the section

20%

Export Experience

3-5

Do you have customers in textile industry? (Y/N) Do you supply to multi-national companies? (Y/N)

20%

Supply capabilities

15%

Quality Control

After-sale services described

10%

Saving Potential Savings Potential

30%

Cooperation Cooperation during RFI/RFQ

N/A

Total scoring

5% 100%

2.6 Supplier Scorecard â&#x20AC;&#x201C; Results Shortlisted

Country Rank

Germany 1

Indonesia 2

Indonesia 3

Indonesia 4

Indonesia 5

Indonesia 6

Supplier

Supplier 1

Supplier 2

Supplier 3

Supplier 4

Supplier 5

Supplier 6

Company background

14.0

15.3

16.0

20.0

13.3

9.3

Export Experience

20.0

19.5

18.0

13.8

20.0

18.0

Supply capabilities

15.0

10.5

13.8

10.5

8.3

Quality Control

15.0

12.0

15.0

13.5

12.0

Corporate Responsibility

5.0

Saving Potential Cooperation Total

20.0 5.0 94.0

20.0 5.0 91.8

20.0 5.0 89.5

15.0 5.0 87.5

17 17

20.0 10.0 5.0 5.0 87.3 67.5 Note: Supplier Profiles in Appendix

2.7 Recommendations and Next step Recommendations for Water Treatment Solutionďź&#x161; We recommend that we move forward with arranging 5 suppliers visit to Client with shortlisted Suppliers to review Client equipment, clarify any questions, and update final proposals for selection for trails.

Next Steps 1. 2. 3.

Arrange 5 supplier visits to Client with shortlisted Suppliers Suppliers to review and send updated proposals Arranged plant trials with selected suppliers

18 18

3.1 Executive Summary: • Project Objectives & Scope - To identify, evaluate high quality and competitive suppliers globally for Defoamer / Antifoam to achieve a cost saving and expanding the supplier base to increase the monthly bidding competition for Client business. • We preformed a prescreening process of potential suppliers by telephone interview, RFI/RFQ, and Balanced Scorecard to fully understand to the market situation of production : • Defoamer : From the initial 53 Suppliers identified, 4 supplier were shortlisted with a potential cost savings of up to 35.7% (380K Euros) vs. the current cost and scoring above 60 on the balance scorecard • We recommend that Client to collect sample for lab test for the 4 to check the product feasibility first.

3.1 Background: Client and Project Approach DS Strategic Project Approach

Context •

Sulfur Sourcing Objectives • Client spends 1.08 M Euros on quicklime powder annually and currently has 2 source suppliers • DS will preform a standard RFI/RFQ process to identify high quality suppliers in Asia to expand the supply base

•

Geographical scope: Target Countries of sourcing: • China, India, Indonesia, UK etc • US Suppliers Excluded

• • •

Deliverables: • RFI / RFQ and Score Card • Supplier profiles • Audit reports

•

• •

Demand Analysis Jointly develop with Client clear understand of requirements, spend, volume, specs, etc. Identify list of potential suppliers globally to include in the RFI / RFQ process by leveraging the web, external databases and various networks of experts Develop the RFI/RFQ – jointly with – to include all key supplier qualification criteria (e.g.: financial, technology, manufacturing and services capability, corporate responsibility, quality, etc.) and quotation requirements Administer the RFI/RFQ process to ensure as high return rate as possible including quotation, and credentials’ visible outlets from supplier Analyze responses and use balance score card developed together with Client management team to rank and recommend suppliers which Client needs to take through a formal qualification process Jointly develop with Client the structure of the audit report Jointly develop or modify contract contents based on needs (when it is needed). Carry out audits (when relevant) (either alone or jointly with Client auditors or buyers) of the suppliers that appear attractive and competitive based on the RFI/RFQ process Issue audit reports (when relevant) and rank suppliers based on audit and price competitiveness Recommend which suppliers to move for sampling (when relevant) Based on samples quality (when relevant), select suppliers with who to enter into final contract negotiations and provide support to the contract negotiation process

3.2. Approach & Schedule: Defoamer Sourcing Project Not started In process

Done Note that the schedule maybe impacted by the time taken to collect category specifications, gain deliverable Delay validation, short list suppliers, produce samples & test samples.

Project Activity Week No.

June, 2014

July, 2014

August,2014

1. Demand Analysis 2. Supply Market Analysis 3. Telephone Prescreening

Ramadan Holiday

4. Develop RFI/RFQ and Scorecard

RFI/RFQ & scorecard Approved

(HARI RAYA PUASA & CURI BERSAMA)

RFI/RFQ Analysis Report Finished

Today

3.3 Demand Analysis: Defoamer Sourcing Project (based on 2013 spend)

Defoamer Technical Requirement: • Non-Silicon Defoamer / Antifoam • Water based • Aspect: Liquid • Color: Yellow – Light • Density: 0.98~1.02 g/cm3 • Viscosity at 20 degrees : 10~60 • PH: 7.0~9.0 Packaging Requirements: • Intermediate Bulk Container (IBC) 1000KG.

Production Chemicals\

2013 (average) Price Euro/MT

2013 Annual Volume(T)

2013 Annual Spend (M Euro)

Current 2014 Price (Euro/MT)

Delivery Terms

Defoamer

Euro2912

373

Euro1.08M

Euro 2879

CIF Jakarta

Supplier #

Name of vendor

Country

Order Qty/KG

Euro/KG (on average)

Total Value / Euro

Current Supplier 1

Indonesia

301,000

2.918

881,030

Current Supplier 2

Holland

71,000

2.886

205,628

Note:1 USD = 0.74 Euro

3.4 Supplier Sourcing Response: 53 Defoamer Suppliers identified with 11 RFI/RFQs received

3.5 RFI/RFQ Analysis: Defoamer potential saving 35.7% of year spend of EURO 380K Defoamer Aug 2014Price current vs Quotes Current 2014 Defoamer vs Price Suppliers Quotes €4,000 3,271

€3,000

3,367

2,960

2,879

2,693

2,756

6.5% 69K

4.3% 45K

2,516

€2,000

1,850 35.7% 380K

1,998

2,035

2,087

2,109

30.6% 326K

29.3% 312 K

27.5% 293K

26.7% 285 K

12.6% 134 K

-2.8% -30K

-13.6% -145 K

-17% -180K

€1,000

€0

2014 Current ML-Blackburn 1 Price CF546

TW - SINO JAPAN

ML-Blackburn 2 DP104

Keyuan

UK - J&W whewell

TW - LYSURF

SIXIN

XWC

ML-Blackburn 3 DP906

Suny

GE (DDP)

3.6 Defoamer Scorecard: supplier Scorecard was developed to evaluate suppliers Can you supply the non-silicon Defoamer as Client request? (Y/N)

Go / No Go If supplier cannot meet any one of Client basic requirements supplier should be rejected. Max Score per Weight of the Scoring criteria section 1= distributor/trader/agent 2= Manufacturer 2 1＜ 5years 2 = 5 -15 years 3= 16-30 years 4= >30 years 4 1= Private owned 2= State owned 3= Foreign investment 3 15% 1< 50 2= 50 – 100 3= 101 -300 4= > 300 4

Location in RFI/RFQ 1-1 2-1 2-2 2-3

Weight of criteria 20% 20% 15% 20%

Turnover in 2013 in Million USD

2-4

25%

1= <10M&NA 2= 10M-50M 3= >50M-150M 4=>150M

Export Experience Do you have an export license? (Y/N)

3-1

15%

0= No 1= Yes

How many years of export experience do you have?

3-2

15%

0=0 1=< 5 2= 5-10 3=11-20 4= > 20

Do you export /sell to Indonesia?

3-3

15%

0= No 1= Yes

Do you have office/branch In indonesia?

3-4 3-5 3-6 5-3

15%

0= No 1= Yes

25%

0= No 1= Yes 2= Yes , listed

15%

0= No/NA 1= Yes 2= Yes , listed

Can you guarantee the continuous supply every month? How many metric tons of defoamer you can gurantee to supply every 3 month? Total supply of Defoamer (tons / year) in 2013.

1-3

25%

0=No 1= Yes

1-4

25%

1= ＜200 2= 200-500 3=501-1500 4＞1500

1-5

25%

1= ＜1000 2=1000-3,000 3= 3,001-10,000 4＞10,000

What is your current capacity level (tons) for the 6 next months?

1-6

25%

1= ＜500 2= 500-1500 3= 1500-5000 4＞5,000

Quality Control Do you provide COA? Do you have quality control management systerm? Do you have ISO9001? Do you have ISO14001? Do you have any other industrial certificates ? Saving Potential

4-1 4-2 4-3 4-4 4-5

20% 20% 20% 20% 20%

0= No 1= Yes 0= No 1= Yes 2= Yes , listed 0= No 1= Yes 0= No 1= Yes 0= No 1= Yes 2= Yes , listed

1 2 1 1 2

15%

RFQ

100%

0= <0% 1= <6% savings 2=6%-15% savings 3= 16%-30% Savings 4= ＞30%

25%

N/A

100%

0= Poor 1= Satisfactory 2= Excellent

5% 100%

Company background Manufacturer or distributor/trader/agent Years of foundation Ownership (State Owned/ Private/Foreign Investment) How many employees do you have?

Do you have customers in Viscous Fiber /textile industry? (Y/N) Do you supply to multi-national companies? (Y/N)

20%

Supply capabilities

Savings Potential

20%

Cooperation

Cooperation during RFI/RFQ

Subtotal

3.6 Defoamer Supplier Scorecard: Scoring 100

Company background Export Experience Supply capabilities Quality Control

Short Listed

80 60

40 20 0

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

Blackburn SINO-JAPAN Country Rank Supplier Company background Export Experience Supply capabilities Quality Control Saving Potential Cooperation Total

Sixin

Keyuan

GE Water

Hefei XWC

Suny

Rongqiang

J&W

Supplier 11

TW - LYSURF Huaxing

Malaysia 1 Supplier 1

China - TW 2 Supplier 1

China 3 Supplier 1

China 4 Supplier 1

Indonesia 5 Supplier 1

China 6 Supplier 1

China 7 Supplier 1

China 8 Supplier 1

UK 9 Supplier 1

China - TW 10 Supplier 1

China 11 Supplier 1

11.1

11.8

10.1

7.9

15.0

9.4

7.5

9.2

0.0

14.0

14.5

11.5

11.0

19.3

9.3

14.8

6.3

0.0

17.5

10.0

12.5

11.0

5.0

20.0

12.5

6.3

0.0

7.5

12.0

10.5

7.5

15.0

6.0

10.5

4.5

0.0

25.0

12.5

18.8

0.0

6.3

0.0

18.8

12.5

0.0

5.0 80.1

2.5 75.8

5.0 62.1

5.0 61.1

5.0 59.3

5.0 55.9

2.5 47.8

2.5 28.7

2.5 21.3

2.5 15.0

0.0 0.0

27 27

3.7 Defoamer Recommendations and Next step Recommendations

â&#x20AC;˘

We recommend that we move forward with collecting samples from the 4 Defoamer Suppliers

Next Steps 1. 2. 3. 4. 5. 6. 7.

Ask the 4 potential suppliers to send samples to Client to do lab test. Base on lab test results agree on suppliers to audit (or go directly to #7 plant trials) Prepare Audit Documents Send Supplier Audit document for self assessment Plan and conduct Audit Analyze Audit results Approve Samples and select suppliers for final negotiation and do trial order

28 28

4. Results: Sourcing projects generated up to 60% savings Indonesia Commodity Sulfur NaOH CS2 ZnSO4 Zinc Ingot Defoamer (Chemical Case Study) TIO2 Quicklime Water Solutions (Service Case Study) Commodity H2O Chems (PAC & Urea) Filters Pumps Transmission Products Pipes & Fittings Standard Tools & Parts Packaging Automation & Switches Service Contract MRO (Bearings & Gears) Transportation & Customs Clearance

Spend (K Euros)

Savings (%)

Savings (K Euros)

9,588 13,400 1,770 1,080 1,050 1,450 480 910 700 300 427 828 256 1,814 379 4,600 -

3.0% 3.6% 1.3% 35.7% 34.9% 6.3% 44.3 - 64.3% 4.5% 2.1% 27.7% 8.3% 18.5% 29.9% 2.0% 6.4% 8.7% -

288 482 23 386 366 91 309 41 15 83 35 153 77 36 24 400 -

39.0M €

7.1%

2.8M €