Case Study-Kitchenware for Brazil

© 2010 Dragon Sourcing. All rights reserved.
Kitchenware for Brazil Case Study
May 2010
Dragon Sourcing - 龙源
Your Tailored Sourcing Approach to Asia

Agenda
1. Our offerings and approach
2. Case Study: Lock Lids
3. Client & DS Partnership

Company Introduction
• The Client is a South American based division of a French multinational in the glass
manufacturing industry. This multinational has become a market leader in several industrial
branches, and is among the 100 largest industrial companies in the world.
• In the spring of 2009, their purchasing group approached Dragon Sourcing to embark on a spot-
sourcing initiative in China to procure several kitchenware items to complement its existing
product line. As a result of this first successful experience buying from China, the Client has
decided to embark on a long-term partnership with Dragon Sourcing in order to pursue new
sourcing activities with a larger number of product categories.

• Shortlist suppliers based on
RFI/RFP process
• Audit shortlisted suppliers
• Select 2-3 suppliers for sample
development process
• Manage sample development
process
• Conduct final negotiations and
select suppliers
• Finalise Contract
• Analyse spend category in detail
– Specifications and quality
requirements
– Volumes
– Deadlines
• Analyse supply market and
identify potential suppliers
• Pre-qualify potential suppliers
through an RFI process
• Manage RFP process with pre-
qualified suppliers
• Analyse supplier responses and
calculate fully delivered price
(logistics, import duties,..)
• Develop Business case and
implementation plan
Dragon Sourcing service offering covers the end-to-end sourcing process
Feasibility Analysis
Supplier Selection
and Contracting
Procurement Operations
• Manage P/O and agree payment
terms and details (L/Cs,..)
• Check in process production quality
• Conduct pre-shipment QC
• Arrange logistics
• Manage supplier performance
• Monitor new sourcing opportunities
Keyactivities

RFI/RFP process
development process
process
select suppliers
requirements
– Volumes
– Deadlines
qualified suppliers
(logistics, import duties, ADT,..)
implementation plan
Supplier Selection
and Contracting
Keyactivities

© 2010 Dragon Sourcing. All rights reserved.© 2010 Dragon Sourcing. All rights reserved.
The first step is to develop a comprehensive understanding of the need and of
the functional requirements
Product Name Set of 3 PP Lock Lids Product Picture
Yearly Quantity 100,000 ~ 200,000 pcs of each
　
Quotation FOB Price
Sizes
Small bowl 0.5 L
Medium bowl 1 L
Big bowl 2 L
Color Lid: Transparent
Silicone ring: color TBD
Received Client QC specs
Description Logo
Leak seal
Packaging Bulk Packaging
HS Code 39241000

Then, an RFI/RFP process is administered to filter out most capable suppliers
Request For Information 征询单
Confidential 保密
To 收件人:
Email 电子邮件:
Tel number 电话:
Mobile 手提电话
Fax number 传真:
SUPPLIER NAME 公司名称
Adress 地址- 街道
City 城市
Province 省
Zip code 邮政编码
Contact person 联系人
Job title 头衔
email 电子邮件
Phone number 电话
Fax number 传真
Website 网址
Which year was your company founded?
贵司是在哪一年成立的？
Ownership
所有权
Capital in million RMB
固定资产（百万人民币）
What is the workfloor size (m²)?
贵司工厂面积有多少平方米？
How many employees do you have?
贵司员工总数有多少？Do you have a good English speaker and writer in your factory?
(Y/N)
贵司是否有可用英语进行书面及口语交流的人员？(是/否)How many years have you been in the PP trolley suitcase
business?
贵司从事PP拉杆旅行箱生产有多少年？
Do you have an export license ?
是否持有进出口许可证 ?
Europe USA Others
% of turnover exported to
出口占销售百分比
CONTACT DETAILS INFORMATION 联系方式
GENERAL INFORMATION 概况
DRAGON SOURCING 龙源有限公司上海代表处
Rachel Yao 姚瑛莹
yingying.yao@dragonsourcing.com
021 - 6141 3974
021 - 6141 3966
159 00 89 89 18
BUSINESS INFORMATION 公司规模
Product Name Quantity Material Size Color Accessory Packaging Carton Size (L×W×H)
产品名需求量材料尺寸颜色附件包装纸板箱尺寸
Set 1:
Set 2:
Set 3:
Set of 3 PP
trolley suitcases
PP聚丙烯手推旅
行箱3件套
9000套（3
件套）
General Information 概述
Product Name Quantity
Gross weight per
carton(in kg)
Total No.of
set/20'container
Total No.of
set/40'container
Product Size
Sample Charge in
US$
EXW US$ price per set
FOB US$ price per
set
FOB port Delivery Time Payment Term
产品名需求量毛重/ 箱（公斤） 20尺柜的装箱量 40尺柜的装箱量产品尺寸样品费( 美元) 出厂美元单价( 一套)
FOB 美元单价(一
套)
FOB港口交货时间付款条件
Set 1:
Set 2:
Set 3:
Logistics Information 物流信息
Set of 3 PP
trolley suitcases
PP聚丙烯手推旅
行箱3件套
9000套（3
件套）
Contact detail
information
Business
information
Product and price
information
Logistics
information
Design
information

Non-food Project Control Sheet - PP Trolley
RFP
Sent
1st
Follow
Up
2nd
Follow
Up
Supplier
Name
City
Re-
gion
Date Date Date Date Remark
Equivalent
product
FOB US$
Small
FOB US$
Middle
FOB US$
Large
FOB US$
per set
FOB
Port
Sample
Charge per
set
Producti
on Lead
Time
Supplier 1
Shen-
zhen
Guang-
dong
21-Nov N/A N/A 20-Nov
very professional and
spontaneous
20-Nov US$5.40 US$7.60 US$9.00 US$20.00
Shen-
zhen
US$50.00
15th
Feb.07
Supplier 2
Wen-
lin
Zhe-
jiang
17-Nov 20-Nov 21-Nov 20-Nov
Professional supplier,
with a competitive
price; cooperative
20-Nov US$6.48 US$9.12 US$10.80 US$24.00
Ning-
bo
US$100.00
60-90
days
Supplier 3
Shen-
zhen
Guang-
dong
17-Nov 18-Nov 18-Nov
very professional and
spontaneous
18-Nov US$6.75 US$9.50 US$11.25 US$25.00
Shen-
zhen
US$100.00 45 days
Supplier 4
De-
qing
Zhe-
jiang
17-Nov 20-Nov 22-Nov
good supplier,
supportive;
22-Nov US$7.02 US$9.88 US$11.70 US$26.00
Ning-
bo
US$50.00 85 days
Supplier 5 Rui-an
Zhe-
jiang
17-Nov 20-Nov 21-Nov 20-Nov
Missing information
received by 22-Nov
4-Dec US$6.21 US$8.74 US$10.35 US$23.00
Ning-
bo
US$100.00 45 days
Supplier Contact
Information
RFP Received
Intend to Respond
Received
During the tender process, the suppliers’ willingness to collaborate and to
provide complete and accurate information is also assessed
Lock Lid Project – Control Sheet

Following a RFI/RFQ screening process,7 suppliers have completed RFI.
Which 5 suppliers have offered both design and quotation
Selection of
potential
suppliers
Pre-selected
suppliers
Intent to
cooperate
Reception of
RFI/RFQ &
Design
41
30
5
11
7 7 6

RFI/RFP process
development process
process
select suppliers
requirements
– Volumes
– Deadlines
qualified suppliers
implementation plan
Supplier Selection
and Contracting
Keyactivities

The supplier selection relies on the short-listed suppliers’ offers, company
background and quality of design
2 suppliers out of 6
were selected for the
sampling stage
Suppliers’ quotation
Received Designs
Suppliers’ Profile

First Sample Second Sample
Sampling Process is recommended to make sure the supplier can make
compliant products
Supplier A
Supplier B
Final Supplier
Design Stage

RFI/RFP process
development process
process
select suppliers
requirements
– Volumes
– Deadlines
• Analyse supply market and identify
potential suppliers
qualified suppliers
implementation plan
Supplier Selection
and Contracting
Keyactivities

Production plan is built to monitor the order and to schedule timely quality
inspections
• Based on the claimed production capacity,
Dragon Sourcing and supplier agrees on the
production schedule
• Sampling and criteria requirements are detailed
in a specific document for customer approval.
DS sends the criteria list to the supplier for
approval.
• 3rd
party QC company is contracted to perform:
• Early Production QC (~10%)
• End of Production QC (~80-90%)
• Container Loading Check
• Inspections are documented in a report
submitted to customer

QC Reports provide detailed information concerning production quality. Action
plans are defined in order to improve product quality
Pictures of Defective

Supplier performance is closely monitored in order to manage the supplier
for continuous improvement
• Shipment follow-up document is created to
track the supplier’s performance in terms
of:
• Timeliness of the delivery
• PO qty vs. actual qty
• QC inspection results

The Dragon Sourcing and Client partnership can be represented in 5 stages
4 Day Supplier Visit
Spot Sourcing
Operational Buying Office
DS & Client Integration
Strategic Buying Office

The DS and Client partnership dates back from May 2009
Spot Sourcing
Assessment of China’s Kitchenware Supplier Market
10 factories in 4 days, focused on:
– Plastic Lid
– Kitchenware acessories
– Opal plate
– Ceramics
– Gift Box
Assessment of China’s Kitchenware Supplier Market
10 factories in 4 days, focused on:
– Plastic Lid
– Kitchenware accessories
– Opal plate
– Ceramics
– Gift Box

Stage 2: Spot Sourcing plan was assigned to DS in June 2009
Spot Sourcing
Shipment History
– Lasagna Lid –PO Value: 300,000 USD – 9 40’ containers
– Spatula –PO Value: 215,000 USD – 1 20’ container
DS Responsibilities
– Identify potential suppliers
– Manage sampling process
– Final negotiations
– Track production
– Define QC Criteria List
– Schedule Quality Control inspections
– Coordinate shipments between supplier, freight forwarder and SG
Other sourcing activities:
– Opal Plate: quotation & sampling stage
– Metal tong: quotation & sampling stage
– Whisk: quotation & sampling stage
– Tableware lids: quotation & 2 rounds sampling stage
– Paper packaging: quotation stage

Stage 3: In September 2009, DS became Client’s buying office in China
Spot Sourcing
Shipment History
– Lasagna Lid: PO Value: 400,000 USD – 11 40’ containers
Attend Sourcing Fairs
– October 2009: 3 fairs: Mega Show, Global Sourcing & Canton Fair
• Tableware Glassware: Opal & Tempered
• Lids
• Accessories: Silicone, Utensils, Spatula set, Fire torch
• Others: Paper display, packaging, other glassware
– April 2010: Canton Fair
• Silicone set
• Plastic Lids
• Opal Plate
• Tempered Glass tableware - Ambar
Sourcing Activities
– Lock Lid: 2 rounds of sampling, choose final supplier, final design phase
– Silicone set: sampling stage
– Lids: sampling and quotation request phase
– Sugar Bowls: collected samples and quotation
– Safety Boots: Awaiting specs
– Ambar plates: Awaiting specs
– Opal Plate: Continuing supplier follow-up

In May 2010, the client invited DS’ Account Manager to Brazil in order to help
develop a long-term sourcing plan
Spot Sourcing
Purpose of the visit to integrate Dragon Sourcing with client’s strategic sourcing
strategy.
HOW?
DS creating a cross-functional bond with client’s departments: purchasing, marketing,
logistics, quality, engineering…
DS understanding the South-American markets
The benefits:
Dragon Souring to provide new product suggestions from the Chinese supplier base.
Accelerate the product development process, hence decrease the time to market
process

DS and Client processes are more in
Spot Sourcing
Dragon Sourcing is closely integrated within the company and communicates daily
with a number of their departments: Purchasing, Marketing and Quality Assurance
Dragon Sourcing can begin looking for purchase goods from other LCCs like India,
Vietnam and Cambodia.
Promote the strength of the Client’s brands to the supply base so they can offer their
new product ideas to us.
Continue to build the supplier base and the range of product categories.

Case Study-Kitchenware for Brazil

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Case Study-Kitchenware for Brazil