Dragon Sourcing - 龙 源 Delivering sustainable sourcing value from emerging markets
Wok Cookware Case Study
© 2021 Dragon Sourcing. All rights reserved.
Agenda
1.
Sourcing Project Introduction
2.
Sourcing Approach
3.
Conclusions
© 2021 Dragon Sourcing. All rights reserved.
Objectives and approach Context Client Introduction: • Client is a leading online US retailer for kitchenware and cookware items. Project Objectives: • Identify and recommend new potential competitive supplies manufacturing Wok cookware. Geographical scope: • India, Vietnam & Thailand
© 2021 Dragon Sourcing. All rights reserved.
Dragon Sourcing approach Stage 1: Supplier Pre-Qualification 1.Demand Analysis 2.Supply Market Analysis 3.Telephone Pre-screening 4.Develop RFI/RFQ 5.Administer RFI/RFQ 6.Analyse RFI/RFQ Responses
Deliverables: • Supplier database • RFI-RFQ template • RFI-RFQ analysis report • DS Recommendation on next steps
Demand Analysis, - Projected annual order volume is 5,000 units, depending on sales velocity
#
1
Category
Wok Cookware
Material
• • Stainless steel • or thin cast iron •
© 2021 Dragon Sourcing. All rights reserved.
Description
Vessel Material: Stainless steel or thin Cast iron Vessel Handle: one piece design connected to vessel Lid Material: same as vessel Lid Handle: stay cool, heat resistant
Estimated Annual Volumes
PCS
5000 Units
Current buying price
New Development
Agenda
1.
Sourcing Project Introduction
2.
Sourcing Approach
3.
Conclusions
© 2021 Dragon Sourcing. All rights reserved.
- Following were the steps covered in Stage 1: Supplier Pre-Qualification
No. 1.
2.
3.
4.
5.
Steps in stage 1 Demand Analysis Work with client to define and understand the Products and requirements (specs, volumes, material, Production technology requirements, others) Supply Market Analysis Identify long list of potential suppliers in the selected emerging markets by leveraging B2B websites, DS database, fair catalogues, Chamber of Commerce, magazines, network, references. Telephone Pre-screening Selection of manufacturers to be included in the RFI/RFP process by telephone pre-screening based on agreed simple criteria (e.g., capability to make the product, min company size, interest in participating) Develop RFI/RFQ document Prepare an RFI/RFQ document, with an aligned balanced scorecard that has the objective to pre-qualify the competitiveness and capabilities of the manufacturers, including background, financial, client and product experience, quality certification & processes, social responsibility, manufacturing/technology capability, R&D capability. Administer RFI/RFQ: The RFI/RFQ is translated to the local languages as relevant, and distributed to the manufacturers, with telephone follow-up to push for maximum participation.
Deliverables • Kick-Off Report
• Shortlist for RFI-RFQ process
• RFI-RFQ Template
• Completed RFI-RFQ’s
6.
Scoring the suppliers: Work with client to draft a balance score card to evaluate suppliers based on the RFI-RFQ.
• Score card document
7.
Analyze RFI/RFQ Responses: Analysis of RFI/RFQ responses, estimation of logistics costs, and preparation of a report, which profiles & objectively ranks the manufacturers by capability and competitiveness, including a recommendation for those to be audited.
• RFI-RFQ Report.
© 2021 Dragon Sourcing. All rights reserved.
Ongoing Completed
- Stage 1: Supplier Pre-Qualification timeframe. - Project completed in 5 weeks as per scheduled STEPS
Week 1
Delayed
Week 2
Week 3
Week 4
Week 5
1. Demand Analysis
2. Supply Market Analysis
3. Telephone Pre-screening
4. Develop RFI/RFQ
RFI-RFQ validated
5. Administer RFI/RFQ
6. Analyze RFI/RFQ responses & send RFQ report.
•
Supplier profiles with recommendations.
Weekly progress report was sent every Friday Finished
© 2021 Dragon Sourcing. All rights reserved.
Milestones
- 51 suppliers were identified from India, Vietnam & Thailand leveraging multiple sources of information & from existing DS database.
Confidential
•
Full sourcing process including building long list of supplier databasewas done online on the DS e-sourcing tool GSP
© 2021 Dragon Sourcing. All rights reserved.
- Pre-screening process was initiated after receiving client validation, - This process was to filter the long list of suppliers prior moving them to the “Administer RFI/RFQ”
Suppliers “Must have” criteria to pass pre-screening.
•
Full sourcing process including pre-screening the suppliers was done online on the DS e-sourcing tool GSP
© 2021 Dragon Sourcing. All rights reserved.
Supplier Profile example • •
Post pre-screening the suppliers, RFI-RFQ process was administered only with the suppliers passed pre-screening
© 2021 Dragon Sourcing. All rights reserved.
RFI Score
71
RFI Ranking
1
Supplier Profile example
RFI process was administered to filter out most capable suppliers
© 2021 Dragon Sourcing. All rights reserved.
Supplier Profile example
-
Category specific technical questions were added in the RFI to understand supplier production capability and capacity.
© 2021 Dragon Sourcing. All rights reserved.
- Supply market analysis was shared in the weekly progress and final report,
Process
Supplier Identification
Steps
India
Total
• Suppliers identified
XX
XX
• Supplier passed pre-screening
XX
XX
• Suppliers failed Pre- screening
XX
XX
• Number of RFI/RFQ sent
XX
XX
• Don't intend to respond
XX
XX
• Only RFI received
XX
XX
• Number of RFI/RFQ received
XX
XX
Pre-screening (Completed)
RFI/RFQ Administration (Completed)
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Supplier rejection analysis was shared with client for each step, 2 1 12
7
30
Producing industrial cast iron items only Traders or distributors Producing aluminum kitchenware only Not interested Stopped producing Pre-screening Rejection
8 2
Do not have machine capability to produce the required product Producing high-end products in the range of USD $50-$80
5 11
4
© 2021 Dragon Sourcing. All rights reserved.
Not interested to continue
RFI/RFQ Rejection
RFI Ranking
Shortlisted Could be considered Not shortlisted
- Price analysis was shared with the client, Client 6860 ml Specs
#
1
Product Name
Vessel Vessel Supplier Country Capacity Weight name in ml in Kg
Material
FOB + FOB Packaging Mold cost Packaging Amortize qty Price/PC cost in $US cost
Supplier Remark,
• Offered based on client dimensions
Wok Supplier 1 India Cookware in Thin Cast iron Supplier 2 Thailand
6860
3.00
Cast Iron
XX
XX
$15.55
6860
3.30
Cast Iron - FC200
XX
XX
XX
XX
XX
•Offered based on client dimensions without Surface treatment, Vessel and Lid handle
Supplier 3 Vietnam
6860
3.00
Stainless Steel 201
XX
XX
$7.78
XX
XX
• Offered based on client dimensions
Supplier 4
6860
3.00
Stainless Steel 200
XX
XX
$9.15
XX
XX
• Offered based on client dimensions
6860
3.00
Stainless Steel 430
XX
XX
XX
XX
XX
• Offered based on client dimensions
India
Supplier 5 Vietnam
2
3 KG
No mold cost
Wok Supplier 6 Cookware in Stainless Supplier 7 Steel
India
6860
2.00
Mild carbon Steel only
XX
XX
XX
XX
XX
• Offered based on client dimensions in mild carbon steel.
India
6860
3.00
Stainless Steel 304
XX
XX
XX
XX
XX
• Offered based on client dimensions
Supplier 8
India
8000
3.40
3 ply SS (304 SS + AL + 430 SS)
XX
XX
XX
No mold cost
•Offered based on available dimensions
Supplier 9
India
6860
2.50
Stainless Steel 204
XX
XX
XX
No mold cost
•Offered based on available dimensions
Supplier 10
India
6860
2.85
Stainless Steel 201
XX
XX
XX
No mold cost
•Offered based on available dimensions
© 2021 Dragon Sourcing. All rights reserved.
RFI Ranking
Shortlisted Could be considered Not shortlisted
- Spend analysis was shared with the client,
#
Product Name
1
Wok Cookware in Thin Cast iron
2
Wok Cookware in Stainless Steel
Supplier name
Vessel Vessel Weight in Country Capacity Kg in ml (approx.)
Material
FOB Price/PC
Spends Mold cost Amortize value based in $US qty on 5000 PCS
Supplier 1
India
6860
3.00
Cast Iron
$15.55
$77,750
Supplier 2
Thailand
6860
3.30
Cast Iron - FC200
XX
XX
$ XX
XX
XX
Supplier 3
Vietnam
6860
3.00
Stainless Steel 201
$7.78
$38,900
$ XX
XX
XX
Supplier 4
India
6860
3.00
Stainless Steel 200 series
$9.15
$45,750
$ XX
XX
XX
Supplier 5
Vietnam
6860
3.00
Stainless Steel 430
XX
XX
$ XX
XX
XX
Supplier 6
India
6860
2.00
can produce in Mild carbon Steel only
XX
XX
$ XX
XX
XX
Supplier 7
India
6860
1.12
Stainless Steel 304
XX
XX
$ XX
XX
XX
Supplier 8
India
8000
2.00
3 ply SS (304 SS + AL + 430 SS)
XX
XX
No mold cost
XX
Supplier 9
India
6860
2.50
Stainless Steel 204
XX
XX
No mold cost
XX
Supplier 10
India
6860
2.85
Stainless Steel 201
XX
XX
No mold cost
XX
© 2021 Dragon Sourcing. All rights reserved.
No mold cost
Total Spend Value XX
RFQ Price Analysis, - Sample cost, lead time and other information was shared in the RFQ Report
#
Product Name
1
Wok Cookware in Thin Cast iron
2
Sample cost in Sample lead $US time
MOQ (PCS)
Production lead time
Packaging
15 days
1500
21 days
Color box
XX
XX
XX
XX
XX
Vietnam
XX
20 days
1000
25 - 30 days
Color box
Supplier 4
India
XX
21 Days
1000
30 days
Color Box
Supplier 5
Vietnam
XX
XX
XX
XX
XX
Supplier 6
India
XX
XX
XX
XX
XX
Supplier 7
India
XX
XX
XX
XX
XX
Supplier 8
India
XX
XX
XX
XX
XX
Supplier 9
India
XX
XX
XX
XX
XX
Supplier 10
India
XX
XX
XX
XX
XX
Supplier name
Country
Supplier 1
India
XX
Supplier 2
Thailand
Supplier 3
Wok Cookware in Stainless Steel
© 2021 Dragon Sourcing. All rights reserved.
Shortlisted
Suppliers Assessment, - Suppliers were assessed and ranked based on their Company profile,
Could be considered Not shortlisted
100 90 80
71 65
Supplier RFI Score
70 60
21 21
50 40
23 23
40 18
16
40
3 18
21
1 2
12 1 1
1 4
5 1
15
17
15
14
13
35
3
3
14
16
19
Supplier 1- IN
Supplier 4- IN
Supplier 2- TH
Supplier 8- IN
Supplier 6- IN
1 2
20
22
Supplier 5- VN
1 1
Supplier 9- IN
5 4
37
Supplier 3- VN
1 1
2 3
16
13
47
Supplier 7- IN
5 2
16
49
Supplier 10- IN
10
52 18 12
30 20
61
1
2
3
4
5
6
7
8
9
10
18
13
0
Business information Score
Certificate, documents and pictures Score
Social responsibility Score
Production Score
Quality management Score
Total Score
© 2021 Dragon Sourcing. All rights reserved.
Vietnam
Shortlisted Could be considered Not shortlisted
Suppliers location was shown on the map.
RFI Scoring
Supplier name
61
Supplier 3
49
Supplier 5
City
Ho Chi Ho Chi Minh Minh City City XX
Location of the Suppliers Marked © 2021 Dragon Sourcing. All rights reserved.
Province
XX
-
Executive summary with key information was shared with the client,
Shortlisted Could be considered Not shortlisted
RFQ Summary
RFI RFI Score Ranking %
Supplier
Country
No. of employees
Years of export experience
Main producing items
Material offered FOB Price Mold cost
Certification
Offered based on client dimensions
Social Compliance Certification
Quality management
1
71
Supplier 10
India
XX
XX
XX
XX
XX
XX
XX
XX
XX
2
65
Supplier 7
India
XX
XX
XX
XX
XX
XX
XX
XX
XX
3
61
Supplier 3
Vietnam
2,000
13
Cookware
Stainless steel – 200 series
$ 7.78
XX
XX
ISO 14001
ISO 9001
4
52
Supplier 9
India
XX
XX
XX
XX
XX
XX
XX
XX
XX
5
49
Supplier 5
Vietnam
200
8
Cookware
Stainless Steel 430
XX
XX
XX
Nil
ISO 9001
6
47
Supplier 1
India
82
3
Cast Iron Cookware.
Cast Iron
$ 15.55
XX
XX
Nil
ISO 9001
7
40
Supplier 4
India
65
6
cookware
Stainless steel – 200 series
$ 9.15
XX
XX
Nil
ISO 9001
8
40
Supplier 2
Thailand
XX
XX
XX
XX
XX
XX
XX
XX
XX
9
37
Supplier 8
India
XX
XX
XX
XX
XX
XX
XX
XX
XX
10
35
Supplier 6
India
XX
XX
XX
XX
XX
XX
XX
XX
XX
© 2021 Dragon Sourcing. All rights reserved.
Agenda
1.
Sourcing Project Introduction
2.
Sourcing Approach
3.
Conclusions
© 2021 Dragon Sourcing. All rights reserved.
Conclusions ✓ Whole project is carried out in 5 weeks with total 51 suppliers identified ✓ All the recommended suppliers were certified with ISO 9001 certification with key production process in-house. ✓ 10 suppliers (India: 7, Vietnam: 2 & Thailand: 1) responded to the RFI/RFQ
✓ Received quotation based on client and available dimensions ✓ Sampling process was initiated with the recommended suppliers.
✓ A plan was framed to audit the recommended suppliers as a next step post sampling. ✓ Overall based on our report, It helped client to identify potential & price competitive suppliers ** Dragon Sourcing has experienced team for performing Technical and Social Corporate Responsibility (CSR) audit or hybrid model combing both.
© 2021 Dragon Sourcing. All rights reserved.