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Global emerging markets sourcing through procurement sub contractors

The document outlines Dragon Sourcing's comprehensive procurement offerings, focusing on sustainable sourcing from emerging markets, particularly China. It details key services such as procurement intelligence, supplier selection, and contract negotiation, along with case studies and client benefits. The company emphasizes its global presence and category expertise, aiming to enhance procurement productivity and decision-making for medium to large corporations across various industries.

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Company Presentation Feb 2018 Dragon Sourcing - 龙 源 Delivering sustainable sourcing value from emerging markets
© 2018 Dragon Sourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China
Procurement Intelligence to deliver you insight into markets to enable effective procurement decision. Global Sourcing to identify, qualify & secure capable and competitive suppliers in emerging markets. Procurement Outsourcing of IPO’s (international procurement offices) to increase productivity, reduce risks and fixed costs and rapidly scale up Procurement Capability Enhancement to Improve the productivity and effectiveness of your procurement function in emerging markets, especially in China © 2018 Dragon Sourcing. All rights reserved. Dragon Sourcing’s Suite of Offerings
Our suite of Procurement Intelligence Offerings covers the full information requirements of Procurement Departments © 2018 Dragon Sourcing. All rights reserved. 4 CLIENT BENEFITS Clarifying Supply Chain Risks Discovering Market Opportunities Informed Buying Decisions PROCUREMENT INTELLIGENCE SUITE Supply Market Analysis Supplier Analysis Industry Best Practices Analysis Price Tracking & Forecasting Category Executive Dashboards Dynamic Should-Cost Models Value Chain Analysis Supplier Financial Assessment Supplier Ethics Assessment - Which countries have potential? - Should we buy-in or manufacture? - Who are the top suppliers? - What are the market dynamics? - Should we buy now or later? - Latest category news? - What will the impact of inflation be? - Is the market trending up? - What are the raw materials? - What are the key risks to supply? - Do these suppliers meet our CSR requirements? KEY CLIENT QUESTIONS
• 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, ADT,..) • Develop Business case and implementation plan • 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 © 2018 Dragon Sourcing. All rights reserved. Our suite of Sourcing Offerings covers the end-to-end sourcing process Value Discovery 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
© 2018 Dragon Sourcing. All rights reserved. Capability Assessment: Improve the effectiveness of your procurement organization 6 1. Assessment 2. Implementation 3. Execution To assess the current situation of the procurement organisation and the demand, and identify the improvement opportunities. 1. Data collection through workshops and questionnaires to gain clarity on the current state and demand. 2. Interviews with staff to determine current roles, understanding of mission & capabilities. 3. Analysis & reporting of the current state, the demand, and the areas for improvement. 4. Draft a detailed plan for implementing and communicating the improvements. 5. Review and approval by stakeholders on the improvements and the implementation plan. To develop and implement the organisational improvements. 1. Develop the new org model, processes, tools, roles & policies. 2. Recruiting for capability gaps & training staff in new roles. 3. Defining a 12 month operating plan. 4. Communicating and formalising launch of the new organisation model. To reinforce the improvements and deliver the first cycle targets. 1. Tracking the adoption of the new tools, processes and policies. 2. Supporting behaviour change with side by side support. 3. Augmenting sourcing projects where there are temporary capability or capacity gaps. Deliverables • Analysis report of current situation and recommendations on the opportunities for improvements • Implementation plan • Communication plan Deliverables • Organisational model • Process documents • Tools, templates & policies • Role descriptions • Recruited staff • Trained staff • 12 month operating plan Outcomes • Reduced overheads • Higher productivity • Increased sourcing savings • Reduced contract leakage • Separation of duties • Increased visibility & control • Focus on value add activities
London Paris Graz Ljubljana Warsaw Budapest Istanbul Tel Aviv Mumbai Shanghai Hong Kong Ho Chi Min City Bangkok Jakarta Johannesburg Melbourne Sao Paulo Mexico City Houston Addis Ababa Prague Kiev Bucharest Riga Manila Lagos Rosario Nairobi Brussels We can cover global emerging markets through our owned offices and our network of procurement sub-contractors © 2018 Dragon Sourcing. All rights reserved. 7 Geographies covered by DS network of procurement subcontractors Santiago Sales offices Buying offices Novosibirsk Myanmar Cambodia Rome MadridMilan Porto Kuala Lumpur DammamCairo
Service and Pricing Dragon Sourcing - Service Offerings Pricing DS Inhouse Outsourced Standard Comment Market Intelligence Procurement Intelligence x Fixed fees according to price list Should Cost Model x Supplier Financial Assessment x Supplier Supply Chain Assessment x Supplier Ethics Assessment x Category Executive Dashboard x Country and Manufacturing Site Evaluation Country Selection x Customized fixed fees based client's needs Country/Region/City Analysis x Factory ramp up support x Global Sourcing Portfolio Analysis & Category Prioritization x Fixed fees according to price list We can offer performance related deals (gain sharing, commissions, trading). Deals are structured on a case by case basis based on (1) spend value, (2) types of categories and (3) nature of the work required by the client; For Long-term Projects / High workload Projects, we move away from our standard pricing approach based on # of categories and # of countries to projects. Identification of potential suppliers (RFI process) x Measuring cost competitiveness of suppliers (RFQ process) x Auditing x x Sample development and testing x x Supplier development x x Contract negotiaton x Procurement Operations QC Management x x Fixed fee based on daily billing rateLogistics Management x Payment / Invoice management x Outsourcing Interim Management x (Buyers) x (SQE, SDE) Fixed fee based on monthly billing rate IPO Management x Fixed fees based on team size Performance related deals are possible to be crafted on a case by case basis © 2018 Dragon Sourcing. All rights reserved.
© 2018 Dragon Sourcing. All rights reserved. In summary our key differentiating points are: • Our ability to provide and end-to-end service from Procurement Intelligence through to Procurement Operations • A business model which ensures that we work exclusively for the benefit of the buyer • Total transparency and sharing of information with the client • Deep procurement process and category expertise combining operational and consulting skills allowing us to provide high quality service across a wide range of categories • An engineering and technical background combined with a deep understanding of industrial B2B buying practices and requirements • Global Footprint allowing us to effectively tap into all emerging market opportunities
© 2018 Dragon Sourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China
© 2018 Dragon Sourcing. All rights reserved. Our clients are medium to large size corporations across a wide range of industries Food & Beverage Construction DIY Industrial Products
© 2018 Dragon Sourcing. All rights reserved. Our clients are medium to large size corporations across a wide range of industries Service Retail Heavy Machinery Automotive Packaging Pharma / Medical Energy/Chemicals Consumer Goods Government Mining
For these clients we have successfully sourced (or are in the process of sourcing) an extensive set of spend categories –Whisks –Cooking items –Bowl –Cast Iron French Oven –Soft Grid Handle –Cast Iron Roster –Oval Plate in Teflon –Water filter –Opal Glassware –Tong –TPE Lasagna Lid –Cast Iron Saucepan –Fondue Set –Elegant plastic plate –Cast Iron Braiser –Vacuum Thermos Bottles • Kitchenware –Melamine dishes –Nylon Spatula –Cast Iron Skillet –Oval Baker –BBQ –Lock Lids –ABS handle/silicon handle Finished goods for retail –Self inflating air mattress –Sleeping bag –Towel / Beach towels –Underwear –White Tshirts –Work wear –Blouse –Padded Jacket –Comber cotton waste –Casual shoes,boots,sandals –Napkin/ Table Cloth –Pillow –PP non woven uniform –PU Boots –Canvas Shoes –Quilt –Coat –Silk Dress –Ladies’ Blazers –Made ups (Linen) –Plaids –Semi finished artificial grass carpet • Textile –Baby wear –Blanket –Carpets –Duvet cover –Socks (Lady, Men) –Jeans –Thermal suit –Egyptian cotton CVC white bleached fabric –Burmuda short – stock lot buy –Shopping Bag –Shopping Basket –Shopping Trolley –Sound Ball –Stones and Marble –Wicker Basket –Stand –Microsign –Baking tray –Plastic trays –Christmas decoration –Deko Spring –Door Sign –Double loop hook –Loop Hook –Magnet –Metal floorstand –Dump bin –Wooden crate –Podium – Fruit liner –Cosmetic display • Goods not for resale －Acrylic Menu Holder －Black hook －Cardboard display －Ceramic products (cup Teapot, Plates) －Counter unit －PVC pocket －Poster stand －Roller scroll －Wire Shelving －Ice cream scoop –Sonic Toothbrush –Tooth Brush –Tooth Floss –Toothpick –Elastic enhanced wrist support –Elastic knee support (4 ways) –Powder free examination glove –Adjustable Medical Chair –Fish Oil –Hand Soap –Hot Water Jar –Moisturizer –Crutch –Ankle support –Neoprene knee support –Electric toothbrush –Deluxe functional lumbar support –Manual toothbrush with blister • Healthcare –Bath Gel –Body care wet wipes –Conditioner –Soft pad elbow brace –Elastic wrist brace –Elastic elbow support –Neoprene waist belt –Elastic ankle support –Knee support –Neoprene ankle brace –Shampoo –Household wet wipes –Humidifier –Luminaries –Misting Lamp –Plastic scoop –Dishwashing brush –Energy saving lamp • Household –Air freshener –Aroma diffuser –Battery Alkaline –Tray –Cloth pegs –Clothes line –Thermos pot –Vase –Wicker basket –Fridge magnet –Tong –Sardines in tomato sauce –Swordfish steak –Tuna steak –Vannamei –Whole Clean Octopus –Red Chilli –Tomatoes –Canned Pineapple –Nut (Peanuts and Cashew) –Pangasius –Whole Clean Squid –Broth Cubes –Wet Noodle/Sauce in Pouch –Noodle/Pasta Cup • Food –Baby Corn –Baby Cucumber –Block of White Sesame Candy –Canned Papaya –Pickled Cherry –High Chair –Toys –Cloud travel cot –Color Book –Diapers –wipes • Baby products –Bottle Sterilizer –Model car –Folding booster •Furniture −Steel Patio Furniture −Rattan Patio Furniture −Outdoor furniture –Vanity –Chair –Wooden furniture －Wicker furniture －Compactus －Office chair • Shoes –Vulcanized shoes –Children EVA sandals –Casual shoes –Rain boots –Surf – lady –UGG boots –GUM boot –Hiking boot –Sauna slipper –Doble pulgger –Surf – man －Outdoor hikers －Children boots －Snow boots －Children beach sandals –Sandwich bag –Soft Tissue Paper –Cardboard Binder –Seafood tray –Trash bag –Touch screen –Tent –iPad stand –Twisted pearl necklace –Bag –Crab pot –PE tarpaulin –Silver drop necklace –Car mat –LED candle –Paper Cup –Plastic Bags –PS Cup –Cup holder –Snap frame –White board markers and clips –Opera house –Black hand bag –Perfume pump –Brass bell with ropes –Shopping basket –Printing postcard, booklets.. –Shoe bag –Kids Bike in aluminium • Consumables –Container bin bag –Deep freezer bag –Book divider –Light box –Light box difital hand tally counter –Yogo mat –Battery –Winter scarf –Sear cover –Satin Wrap –Fixture –Plastic box –Cord bag –Flat bag
For these clients we have successfully sourced (or are in the process of sourcing) an extensive set of spend categories Laboratory items Packaging • Consumables –Beakers –Brown glass bottles –Caps bouffant –Conical flask –Corundum crucibles –Coverall –Count Tact Box –Disposable centrifuge tubes –Disposable latex gloves –Disposable nitrile gloves –Disposable plastic dropper –Disposable sterile masks –Disposable syringes –Drip tube –Graduated cylinders –Halfline measuring cups –Hollow glass stopper –Jerricans –Mechanical stopwatches –Mercury thermometer –Micro plates –Paper wiper –Petri dishes –Pipette tips –Plugs –PTFE magnetic stirring bar kit –Shoe Cover –Stainless steel medicine spoons –Testtube brush –Two neck flasks –VIDAS plastic Barrett –VIDAS plastic container –Wash bottles –Wide mouth plastic bottles –Wrist cuff –Tongue depressor –Swab –Irradiation label –Extensive pH indicator paper –Funnels –Gloves –Tongue depressor –Tubes –Ear washing bulb • Equipement –Walk in Fume hood –Wide Fume hood –Racks –Autoclave –Sealing machine –Precise peristaltic pump –Haier freezer for pharmaceutical industry –Water heater –Laminar flow cabinet –Freeze dryer –Stainless steel chair –Marble table for lab –Steel shelf –Cabinet –Vortex mixer • Plastic –Bread bag –CD Box –Film –Freshness box –Innerfoil –Intermediate Bulk Containers –Multilayered and Coextruded Films –Multilayered and Coextruded Plastic Films –Plastic Pallets –Plastic box –Hangsell –Thermal sealable cellophane –Wine Bottle Capsule –LDPE foam –Plastic bags –Plastic bubble wrap –U shape edge protector –Plastic rigid bottles, caps –Plastic rigid tubes –Carton box handle –Woven Plastic Sacks –Shopping bag –Garment bag –Cardboard bin with plastic tray –Strawberry container –Adidas tray –Brochure holder –Menu holder –Printing Film on Reel for Food Industry –Plastic rigid jars • Paper –Carton for Food Industry –Chocolate Boxes –Corrugated Packaging –Cardboard box 7 layers –Labels for electronic devices – Lables and print –Hamburger box –Hot Chip Box/Hot beverage cup –Multilayered Paper Sacks –Filter paper • Wood –Wine Bottle Cork Stopper –Wine Boxes –Wooden biscuits box –Lumber –Fasteners –Stainless steel box • Metal –Beer kegs －Tin Boxes Construction Materials MRO Raw Materials Production Equipment - Cupper - Can bodymaker - Washer - Decorator - Pin Oven - Sprayer - Necker - Empty can palletizer - Hydraulic Press machine - Shell press - Conversion system - Liner - Conveyer - Dryer - Shell balancer - Auto bagger - Vessels - Screen printing equipment - Inverter - Agitator - Pipe line - Rotary dryer -Round seamless steel bar -Cathode Bar -Activated Carbon -Silicon metal -Silicon metal HP -Steel wire cordage -Steel wire -Potassuim Amyl Xanthate -Sodium sulfide -Sodium chlorate -Potassium permanganate -Aluminum fluoride -Benzoin Gum -Ammonium sulfate –Haz Mat Shoe Boot –PVC industrial gloves –Nitrile industrial gloves –Safety glasses –Coverall –Protective glove –Welding Helmet –Headband –Tear away mesh –Beach hats –Cooling bandanas –Boot steals –Sunscreen Lotion –Earplug –Anti fatigue Mat –Work wear –Cool Cap –Baseball Bump Cap –Protective Clothing –Duct tape –Helmet Lens –Respirator –Protective Eyewear –Cut resistant glove -Wire Mesh - Aluminum laminate - Fiberglass tissue - Tack strip - Concrete Accessory -Agriculture Product -Metal Lath -Wood flooring -Organic fiber -Zamak handle -Wire rods -Steel Wire -Cable Ladder - Plywood - MDF (medium density fiberboard) - PTB (Particle board) - Nail - Moulding -Laminate flooring -Drawer side -ABS handle with aluminum finishing -Plywood -Steel -Cable Channel -Resin Basin -Deformed steel rebar in coil & Straight length -Southern yellow pine -DWI Aluminum Can Raw Materials: inks, Ultra premium® exterior paint, Basecoat, Premium spray paint, Sealant compound -T6 6060 Aluminum extruded profiles -Steel Angle -Cable Tray • Glass –Alcohol bottles –Beverage bottles –Food Jars –Pharmaceutical bottles & vials –Cosmetic bottles –Wine bottle and outer carton
For these clients we have successfully sourced (or are in the process of sourcing) an extensive set of spend categories Industrial items –PVOH (Polyvinyle Alcohol)Fully hydrolysed –DINP di-isononyl phthalate • Industrial Plastic –PVB film for automotive glass –PVB film for Construction, building glassPVB resin for PVB film manufacturing • Tools –Hand saw –Scrapers –Steel Wire brush –Tool Case –Utility knife –Wall brush –Tapes –Staples • Supporting range –DIN Rail –Perforated strips –S Hooks –Steel chains –Suspension Hooks –Threaded rod • Grounding range –Brass connector –Cloverleaf rod closed clamp –Cloverleaf rod flat clamp –Connecting bolt –Cross shape rod with bolt –Derivation connector –Earthing clamp –Isolation bar –Round rod closed clamp –Round rod flat clamp –Striking head –Threaded copper round rod –Cable terminal –Cable tie –Cable attachment • Connecting range –Christa’l terminal –Heat Sink –Low current connectors –Peltier element –Power cord –Terminal for lamps –Terminal strip black Do it Yourself items • Electrical –AWG wire –Cable sleeve –PCBA –EMT straps / Couplings –Electric racking –Electric switches –Electric protection –Electric cable –Electric lighting –Electric ground rod –Electric general －Plastic Injection: Wheel joint for Baby trolley, ABS and PP , Luggage wheels, Coffee Machine parts, winddeflector, front beam, Black hook, Curved shelf, Plastic number, Rota vials, HIV vials, FOB vials, Fasteners & Springs • Processed Technologies –Castings: exhaust, In queue product parts, Axle Housing Assembly, Coffee Machine parts; Hollow Steel Structure; Steel structure for solar panel; Counter weight filler bit, Meat mincer, Heating block, Die casting assy axle, insert, Cast PU components, Cast AI components –Extrusion: Aluminum extrusion parts, Baby trolley parts, Alu-alloy part , Data strip, Railshaped ruler –Metal Cutting and Melding: Hollow steel structure, Steel structures for solar panel –Stampings: Bread Pans for Automated Ovens, Steel Containers, Steel Containers Coffee Jug, In queue product parts, Industrial Boiler Components, Lamp armature, Stainless steel display tower, glass reinforcement, spring wind deflector, Safety bar -Forging Lower tube sheet, Gears, Shaft Axle, Custom hot rolled steel profiles –Hot Rolled Wire –Mud Stay –Plastic Bread Trays –Stainless Steel products –Tractor –U bolts –UTube –Water tank –Ductile Iron Pipe and fittings –Car window channel –Wire fence –Carcass Light Box –Electric and gasoline generator –Solor motor –Invertor –Brass roller buckle –Steel basic frame –Solenoid –Speaker –Transformer –Filter –Electro-magnets –Pump –Ni Magnet –Ball Valve –Surge Protector • Finished products –Bread tins –Bus bumpers –Car batteries –Coffee Machine –Cutting knives –Electric aerosol dispenser –Fasteners –Fifth Wheel –Flame detector –Tungsten wire –Grinding media –Magnet –Double loop hook –Wind Turbine Permanent Magnet Generator/Alternator –Brass lock –Twist lock with fixed hinge –Engraved padlock –Full zipper puller –Brass rivet –Zinc alloy hook –Plumbing –Membrane keyboard –Gauge –Neck Printing Machine –Metal Bracket –Handbag/Luggage lock&puller –Composite tube –Motor assembly –Universal AC motor for Food Processing Machine –Sheet metal – ATB reader –Machining – ATB reader –Turned parts – ATB reader –Conduits –Battery charger –Battery –Brass padlock with two keys –Twistlock –Padlock –Buzzer –Electric motor –Electric motor for water filtration system and GE appliance –Flanges & Fittings –HVAC –Printed circuit board –Aluminum sheets –Fin Stock real • Road Transportation • Travel agencies • Airlines • Warehousing • Creative agencies • Legal Service Services
For these clients we have successfully sourced (or are in the process of sourcing) an extensive set of spend categories Chemicals and Food Ingredients –Acetonitrile 99.9+% 0.782g/mL (Methyl cyanide) for HPLC gradient analysis CertiFied HPLC –Acetone (Propanone) –Metanol grad. Hplc –Methylene Chloride Optima –Dichloromethane 99+% (GLC) stabilised with 0.005% amylene SpeciFied –Heptan-n 99,5% pa –Ethyl acetate cert acs/hplc –Acetonitril –"Blood Agar" –Tetrahydrofuran 99.5+% (GLC) stabilised with 0.025% 2,6-di-tert- butyl-p-cresol –iso-Hexane contains < 5% n- hexane for HPLC CertiFied –Hexane optima grade –Hexane cert acs/hplc –Xylene –Tryptic Soy Broth • Pharmaceutical –Water 0.1% tfa –Dodecyl Sulfate Sodium –Ethanol 99.8+% (GLC) 0.7897g/mL absolute (Ethyl alcohol) for analysis CertiFied AR –Dimetylsulfoxid –Human Serum –Horse Serum –Sulfuric acid –Brucite –Turpentine- Myrcene –Turpentine- Citronellene –Turpentine-Alpha-Pinene –Turpentine- Beta-Pinene • Industry –Calcined bauxite –Vitamin A 1000 IU Retinol –Vitamin B1 –Vitamin B12 –Vitamin B2 –Vitamin B3 –Vitamin B5 –Vitamin B6 –Vitamin B9 –Vitamin C Acid Ascorbic Dried –Vitamin C Stabilised 35% –Sorbitol esters –Soya Protein –Tartaric acid –Taurine –Tetra Potassium Pyrophosphate (TKPP) –Tetra Sodium Pyrophosphate (TSPP) –Titanium dioxide (TiO2) –Tri calcium Phosphate –Trilon A92 (Chelating agent) –Trilon B (Chelating agent) –Vitamin A - All-trans-retinyl acetate –Glycine –L-cysteine –Lecithin –Liquid Caustic Soda –Milk –Mono calcium Phosphate –Phosphoric Acid (75%) FCC –Phosphoric Acid: 80%, –Potassium Sorbate –Propionic acid –Sodium Stearoyl lactylate –Sodium Tripolyphosphate (STPP) –Sorbic acid –Vitamin E (VE) • Food and Animal Nutrition –80% Sulphur DF and 20% Mancozeb WP –Benzoic acid –C8 10L Fatty Acid –Calcium Propionate –Caustic Potash –Caustic Potash (Liquid) –Caustic Soda Pearl –Citric acid –Di calcium Phosphate –Dicalcium Phosphate (DCP) –Glycerine (Palm/Coconut derived) –Xylose –Sodium Phosphatemonobasic –Sodium Thiocyanate –Sucrose –Tartrazine Acidyellow 23 –Thimerosal –TMB . 2HCl . 1H2O –Trans-Cinnamaldehyde –Trishydroxymethylamino methane –Triton X-100 –Urea HydrogenPeroxide –Variquat 56 –Zwittergent 3-14 –Mops(morphol.Prop.Sulf onic Acid) –White/vory Beeswax –Antimony Oxide –RBD LLP –Poly ethylene Glycol (Macrogol 8000) –Polysorbate 20 –Potassium dihydrogenphosphate –SERMUL EN 9 –Sodium Hydroxide –Sodium Carbonate –Sodium ChlorideType A –Sodium citratedihydrate –Sodium Hydrogen Carbonate –Sodium Iodacetate –Sodium phophatemonobasic monohydrate –Sodium phosphate dibasic dihydrate –Goat anti rabbit antibody & goat anti mouse antibody –Coconut Oil –Emdex –Eryoglaucine –Erythrosin B –Ethanol 96% denatured (5%Methanol) –Ethanol Type A (96% v/v) –Gentamicin sulfate salt –Glycine –GuanidineThiocyanate –HEPES free acidULTROL Grade –Horse Radiche Peroxidase Grade II –Hydrochloricacid 37% –Iron(III) chloride Hexahydrate –Kathon CG Biocide –Linalool –Bile salts –Albumin prepared from Human plasma • Biological –2-Chloroacetamide –2-Chloro-N- (hydroxymethyl)acetamide –alpha,alpha-TrehaloseDihydrate –Amaranth –BromocresolPurple –Calcium Chloride dihydrate –Citric acid Monohydrate –CTAB –Dextran Blue –Dextran T40 –Disodium EDTA dihydrate reagent (ACS) –DL-Dithiothreitol –NASBA Lysis buffer 500 ML –Mannitol reagent (ACS) –Sheep blood –Organic Stearic Acid Promotional items • Gifts –Electronic gadget: Photo frame, USB Key, Flashlight…. –Premium:Lighter, key ring, money clip… –Umbrella and parasols –Wine related gifts: cooler wine bottle ring, bottle opener, parkling cork, wine standee, wine bucket, Vacuum stopper… –Writing instruments: Notebook, ball pens… –Plastic diffuser and LED • Display –Cardboard display –Light box –Metal display –Plastic display • Glasses –Bar accessories: Decanter, Jug, Water carafe, Ice bucket… –Glasses: Cognac glasses, Wine glasses, Whisky glasses, Cocktail glasses, Champaign glasses… • Luggage and Textile –Backpack –Bags –Luggage –Textile: Uniform, Apron, Towel set, Jacket • Printing & Boxes –Brochures –Christmas cards –Gift boxes –Shopping bag –High temperature resistant spray paint
© 2018 Dragon Sourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China
© 2018 Dragon Sourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
© 2018 Dragon Sourcing. All rights reserved. Context • Major global FMCG company producer – Presence in over 70 countries, including Europe, Asia and America – 18,000 employees worldwide – Approx $8 billion turnover – 15 key brands accounting for 70% of total turnover • Effective management of marketing spend requires to overcome several challenges: – Double digit growth in BTL marketing budget (approximately RMB120M/year) – Communication within a complex decentralised organisation (brand driven) – Collaboration between employees with very different backgrounds – Relationship with creative agencies for product design – Peak demand and short time to market – Reactivity to frequent design change requests • Decision to outsource BTL marketing/promotional procurement in 2005 to Dragon Sourcing
© 2018 Dragon Sourcing. All rights reserved. Major trends in marketing services in China • Use rigorous sourcing methodology as in the industry to manage creativity profusion, short time to market and non recurrent purchasing • De-aggregate supply chain between creative agencies and manufacturers • Set up IPO or use PSP in China instead of traders in Europe to buy directly from manufacturers • Look for value-added suppliers providing innovative solutions vs standard catalogue items • Increasingly focus on CSR and environmental issues in supplier selection process • Sourcing diversification outside China (e.g.: Vietnam) to leverage even lower cost suppliers
© 2018 Dragon Sourcing. All rights reserved. Marketing spend includes all goods typically designed by creative agencies, such as gifts, boxes or glasses GiftsStandees Boxes Glasses
© 2018 Dragon Sourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
Dragon Sourcing manages, for all BTL categories, the whole sourcing process… • Negotiate contract with supplier • Facilitate supplier and customer signatures • Monitor down-payments • Follow production quality • Organize delivery • Manage quantity variation effects • Organize final payment • Measure supplier performance • Collect product design proposals from creative agencies • Forecast future volumes and consolidate requirements • Manage RFQ process with all qualified suppliers • Collect supplier samples and refine final product design • Update supplier quotations • Negotiate and select supplier © 2018 Dragon Sourcing. All rights reserved. Contracting, Production & Delivery Product design & Supplier selection Supplier qualification & Supply base management • Monitor supply markets • Qualify potential new suppliers through an RFI and « theoretical » RFP process • Analyse responses and « identical » samples • Audit suppliers • Follow current supplier performance • Set up list of qualified suppliers – Introduce new supplier in base – Eliminate poor performing current supplier
© 2018 Dragon Sourcing. All rights reserved. … for approximately 350 discrete sourcing projects driven by 2 major annual events: Mid-Automn Festival and Chinese New Year Monthly spend evolution M ay-05June-05July-05 August-05 Septem ber-05 O ctober-05 N ovem ber-05 D ecem ber-05 January-06 February-06M arch-06April-06M ay-06June-06July-06 August-06 Septem ber-06 O ctober-06 N ovem ber-06 D ecem ber-06 January-07 February-07 Mid-automnfestival ChineseNewYear Mid-automnfestival ChineseNewYear
© 2018 Dragon Sourcing. All rights reserved. The RFI/RFP and “identical sample” process result in a short-list of potential new qualified suppliers Pre-qualified suppliers Potential new qualified suppliers Potential suppliers Qualification of suppliers through RFI/RFP RFI/RFP process Sampling process Analysis of offers and samples Potential Supplier 1 Potential Supplier 2 Potential Supplier 3 Current Supplier Price Prod. 1 26.4 23.8 24.9 24.6 Prod. 2 36.1 33.8 34.9 33.7 Prod. 3 13.4 15.1 12.2 12.8 Prod. 4 40.2 38.1 41.3 38.4 Region Jiangsu Zhejiang Shanghai Shanghai Turnover (M€) 6 14 8 19 Staff 350 700 430 880 Capabilities 100/day 120/day 75/day 140/day Cooperation Good Good Average Good Samples
Objectives • Meet top management and sales management teams • Present product requirement and order details • Understand organisation and processes • Refine offer understanding • Validate manufacturing capabilities • Visit factory and check work conditions Topics • General Management • Order management • Shipping / packaging • Planning process • Goods flow • Procurement • Purchasing • Production • Quality © 2018 Dragon Sourcing. All rights reserved. This shortlist is then audited in order to finalise the qualification process Audit questionnaire Audit report Audit summary
CONTACT INFORMATION 联系资料 B+ Response 评分 Comment 附加 评语 Response 评分 Comment 附加评 语 Yes/No 被取录/ 不取录/ Comment 附 加评语 V019 estate catalogue Jul-06 Not needed, known supplier 常用供应商 Yes, on time 守时收到 Yes 有 Yes 有 V020 shopping bag Jul-06 Not needed, known supplier 常用供应商 Yes, with delay 迟受到 No 没有 No 没有 V021-V050 mini brochures Jul-06 Not needed, known supplier 常用供应商 Yes, on time 守时收到 Yes 有 Yes 有 A Required 计划时间 Actual 实际时间 V019 estate catalogue Jul-06 10 11 1 Low 低 V020 shopping bag Jul-06 20 23 3 Low 低 V021-V050 mini brochures Jul-06 20 20 0 Low 低 A Contract number Items Date (mm/yy) 日 Proposed alternative (yes/no) 有否提供建议 Impact of proposal 建议重要 V019 estate catalogue Jul-06 Yes 有 High 高 V020-V039 shopping bag Jul-06 No 没有 N/A 不应用 V021-V050 mini brochures Jul-06 No 没有 N/A 不应用 A+ Contract number Items Date (mm/yy) 日 Quality issues (yes/no) 质量 Issue Criticality/ Impact 质量重要性 V019 estate catalogue Jul-06 No 没有 Low 低 V020 shopping bag Jul-06 No 没有 Low 低 V021-V050 mini brochures Jul-06 No 没有 Low 低 INDUSTRY 行业 QUALITY PERFORMANCE (Other issues than delay) 服务性质量评分 （不包括送货延误事情） PROACTIVENESS 前摄能力 (Good supplier should constantly propose alternative technology or cost-cutting options without jeopardizing quality and appearance / 好供应商应经常事先提出新的生产法案和改良方法) Contract number Contract number RESPONSIVENESS IN PARTICIPATION TO RFx / COMPETITIVENESS 回应效率 / 竞争力 Shanghai xxxxxxxxxxx Co Ltd Paper No 2,Lane xxx, Xxxxx Road Shanghai Address 地址 City / Town 城市 SUPPLIER PERFORMANCE TRACKING 供应商项目评分 SECTOR 分类 Printing COMPANY NAME 公司名字 General Manager Manager Assistant Mobile phone 手机号码 cd@xxxx.comab@xxx.comEmail 电子邮址 RFQ stage 报价阶段 139xxxxxxxxx 131xxxxxxxxxxx Recommended to the client 已推荐 给客户 Date (mm/yy) 日 期 （月/年） Comment 附加评语 Delivery lead-time (days) 生产期 （天） Selected for negotiation after RFQ 报价后，已被取录 ON-TIME DELIVERY PERFORMANCE 发货守时评分 Comments on issue, impact and supplier explanation / 请解释服务性质量和它们的重要性 On-Time Delivery Criticity 准时重要 性 RFI stage 要求资料阶段 First Name 名字 ALTERNATIVE CONTACT 其他联络人 C MAIN CONTACT 主要联络人 A Title 职位 If yes, please describe alternative and comment impact / 如果“有”，请解释他们的提议和重要 性 Give advice on paper to use in order to save cost Date (mm/yy) 日 期 （月/年） Products # # of days delay 延误 （天） The current suppliers’ performance is assessed on an on-going basis A+ Supplier Scorecard Competitiveness Q1 Q2 Q3 Q4 On-time delivery Quality Proactiveness B+ B+ B+ A A A+ B A B B+ A A B+ B B B+ A B+ B+Performance Overall performance Q1 Q2 Q3 Q4
© 2018 Dragon Sourcing. All rights reserved. Introduction of new suppliers into the sourcing pool contributes to driving cost and quality improvements while challenging incumbent suppliers Alternative sourcing opportunities monitoring Current supplier performance management List of qualified suppliers • Supplier name • City, web site, contact • Turnover, #employees • Price structure • Capacities • Audit report • Samples • New supplier 1 • New supplier 2 • New supplier 3 • … • New supplier n • Current supplier 1 • Current supplier 2 • Current supplier 3 • … • Current supplier n Supplier pool structure 0 5 10 15 20 25 30 35 40 45 50 New suppliers (< 1 year) New suppliers (1-2 years) Historic suppliers (> 2 years) > 2 years 1-2 years <1 year
© 2018 Dragon Sourcing. All rights reserved. Creative agencies provide initial specifications for each product Item Material Size Process requirement Product Picture Cardboard 4mm board, 157 paper 400*120*125 shape, paperhanging Plastic bed & Flocking PS plastic with flocking Subject to real size shape Printing - 174 gram silver paper - Ink DIC - - Color 5 C - - Surface protection Plastic film Subject to real size Outside Package Triple wall corrugated fiber box 8 units / package Mark: SKU Test Method Strength test
© 2018 Dragon Sourcing. All rights reserved. Cross-brand quantitative requirements are consolidated by product categories to leverage negotiation with suppliers Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Product 1 63,548 64,993 10,560 6,744 14,175 13,823 7,484 12,207 Product 2 45,592 48,739 12,997 7,945 7,354 6,092 7,412 6,939 Product 3 46,886 50,750 9,489 7,225 13,598 8,610 5,302 6,525 Product 4 50,736 52,358 9,133 7,388 11,200 12,431 5,965 6,241 Product 5 47,616 47,833 11,542 5,819 5,796 10,704 5,896 8,075 Product 6 44,016 45,626 11,169 5,647 8,981 5,109 6,330 8,390 Product 7 47,030 48,779 10,134 5,305 9,058 9,306 6,291 8,685 Product 8 46,948 48,666 8,373 5,954 7,366 9,890 7,345 9,738 Product 9 51,204 53,550 11,104 7,424 12,723 7,770 5,057 9,471 Product 10 47,674 50,052 12,832 6,699 7,582 9,148 7,593 6,197 Product 11 59,735 64,437 11,648 6,731 14,498 13,442 6,637 11,481 Product 12 40,135 44,001 5,136 7,563 6,148 8,971 6,853 9,330 Product 13 43,453 47,023 10,732 6,967 5,852 8,930 5,839 8,703 Product 14 46,570 48,411 8,827 6,655 11,949 9,258 5,112 6,610 Total 681,142 715,217 143,676 94,067 136,280 133,485 89,116 118,593 Fore- cast Actual produc- tion Brand 2 Var. Brand 6Brand 5Brand 4Brand 3 Unit: pcs Brand 12006 CNY Actual
© 2018 Dragon Sourcing. All rights reserved. The RFQ process includes a supplier cost structure breakdown to check consistency and to gain a deep understanding of price drivers Box production TransportationPrinting and effects on the printing C ardboard -纸 板 Flocking -植 绒 Plastic Bed (PS)-吸 塑 O utside Package -外 包 装 Afterprocess & Labor-后 道 &人 工 Paper-纸 张 Ink -油 墨G olden/SilverPrinting -印 金 /印 银 Film C overing -覆 膜 SpotU V Varnishing -过 釉 G olden/SilverStam ping -烫 金 /烫 银 Em bossing /D ebossing -凹 凸 处 理 Price ofextra 4C printing -4色 印 刷 Price ofextra 6C printing -6色 印 刷 Price ofextra 7C printing -7色 印 刷 TO TA L Shanghai-上 海 Beijing -北 京 Xiam en -厦 门 Zhongshan -中 山 W uhan -武 汉 C hengdu -成 都 Supplier 1 4.49 0.32 0.28 1.54 3.87 0.26 0.62 0.04 0.44 4.62 0.28 0.23 0.07 0.55 0.05 17.7 0.21 0.09 0.43 0.67 0.79 2.18 Supplier 2 4.06 0.31 0.26 1.63 3.91 0.24 0.63 0.04 0.48 4.95 0.27 0.24 0.06 0.54 0.04 17.7 0.20 0.08 0.39 0.64 0.81 2.36 Supplier 3 4.54 0.31 0.29 1.44 3.72 0.26 0.66 0.04 0.40 4.56 0.26 0.24 0.07 0.60 0.04 17.4 0.19 0.09 0.44 0.72 0.82 2.14 Supplier 4 4.36 0.34 0.31 1.64 4.17 0.24 0.62 0.04 0.41 4.99 0.28 0.22 0.07 0.58 0.05 18.3 0.20 0.08 0.42 0.68 0.74 2.34 Supplier 5 4.42 0.31 0.26 1.45 4.01 0.24 0.58 0.04 0.43 4.27 0.30 0.25 0.07 0.58 0.05 17.3 0.23 0.08 0.43 0.71 0.79 1.98 Supplier 6 4.57 0.32 0.29 1.58 3.82 0.23 0.64 0.04 0.42 4.29 0.26 0.23 0.07 0.53 0.05 17.4 0.23 0.09 0.40 0.60 0.72 2.02 Supplier 7 4.87 0.33 0.29 1.41 4.00 0.25 0.56 0.05 0.41 4.25 0.26 0.23 0.07 0.54 0.05 17.5 0.21 0.08 0.44 0.65 0.82 2.21
© 2018 Dragon Sourcing. All rights reserved. The final supplier selection is based on sample quality and price level Suppliers’ quotation Sample Supplier Name Final Ranking Supplier 1 1 Supplier 2 4 Supplier 3 2 Supplier 4 5 Supplier 5 3 Supplier summary Supplier capabilities Supplier assesment Box production TransportationPrinting and effects on the printing C ardboard -纸 板 Flo ckin g -植 绒 Pla stic Bed (PS)-吸 塑 O utsid e Package -外 包 装 Afterprocess & Labor-后 道 &人 工 Paper-纸 张 Ink -油 墨G old en/SilverPrin tin g -印 金 /印 银 Film C overin g -覆 膜 SpotU V Varnis hin g -过 釉 G old en/SilverStam pin g -烫 金 /烫 银 Em bossin g /D ebossin g -凹 凸 处 理 Pric e ofextra 4C prin tin g -4色 印 刷 Pric e ofextra 6C prin tin g -6色 印 刷 Pric e ofextra 7C prin tin g -7色 印 刷 TO TA L Shanghai-上 海 Beijin g -北 京 Xia m en -厦 门 Zhongshan -中 山 W uhan -武 汉 C hengdu -成 都 Supplier 1 4.49 0.32 0.28 1.54 3.87 0.26 0.62 0.04 0.44 4.62 0.28 0.23 0.07 0.55 0.05 17.7 0.21 0.09 0.43 0.67 0.79 2.18 Supplier 2 4.06 0.31 0.26 1.63 3.91 0.24 0.63 0.04 0.48 4.95 0.27 0.24 0.06 0.54 0.04 17.7 0.20 0.08 0.39 0.64 0.81 2.36 Supplier 3 4.54 0.31 0.29 1.44 3.72 0.26 0.66 0.04 0.40 4.56 0.26 0.24 0.07 0.60 0.04 17.4 0.19 0.09 0.44 0.72 0.82 2.14 Supplier 4 4.36 0.34 0.31 1.64 4.17 0.24 0.62 0.04 0.41 4.99 0.28 0.22 0.07 0.58 0.05 18.3 0.20 0.08 0.42 0.68 0.74 2.34 Supplier 5 4.42 0.31 0.26 1.45 4.01 0.24 0.58 0.04 0.43 4.27 0.30 0.25 0.07 0.58 0.05 17.3 0.23 0.08 0.43 0.71 0.79 1.98 Supplier 6 4.57 0.32 0.29 1.58 3.82 0.23 0.64 0.04 0.42 4.29 0.26 0.23 0.07 0.53 0.05 17.4 0.23 0.09 0.40 0.60 0.72 2.02 Supplier 7 4.87 0.33 0.29 1.41 4.00 0.25 0.56 0.05 0.41 4.25 0.26 0.23 0.07 0.54 0.05 17.5 0.21 0.08 0.44 0.65 0.82 2.21
© 2018 Dragon Sourcing. All rights reserved. Very short time to market requires efficient contracting and payment management 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 6-Nov 13-Nov 20-Nov 27-Nov 4-Dec 11-Dec 18-Dec 25-Dec 1-Jan 8-Jan 15-Jan 22-Jan 29-Jan 5-Feb 12-Feb date #contracts signed by supplier signed by customer -17 -12 -18 -29 -29 9-Nov-06 19-Nov-06 29-Nov-06 9-Dec-06 19-Dec-06 29-Dec-06 8-Jan-07 18-Jan-07 28-Jan-07 7-Feb-07 17-Feb-07 1 Theorical date of downpayment Actual date of down payment Down payment tracking Contract signature analysis Order global overview Delivery status 15-Nov-06 22-Nov-06 29-Nov-06 6-Dec-06 13-Dec-06 20-Dec-06 27-Dec-06 3-Jan-07 10-Jan-07 17-Jan-07 24-Jan-07 31-Jan-07 7-Feb-07 Product 14 Product 13 Product 12 Product 11 Product 10 Product 9 Product 8 Product 7 Product 6 Product 5 Product 4 Product 3 Product 2 Product 1 Signature date Start Production 1st batch completed 2nd batch completed 3rd batch completed Batch 1: 25/12 Batch 2: 10/01 Batch 3: 21/01 • Contract preparation in collaboration with Legal • Close interaction with suppliers and customer to have contracts signed rapidly • Monitoring of customer down-payments triggering production start • Follow-up of production progress
© 2018 Dragon Sourcing. All rights reserved. Overall methodology & 7-step process Quality is regularly monitored during production and at pre-shipment • Dragon Sourcing teams are trained to follow a 7-step process to execute Quality inspections • Sampling and criteria requirements are detailed in a specific document for customer approval • On-site data are recorded in a specifically designed Excel table • Inspections are documented in a report submitted to customer • Action plans are defined in order to improve product quality Sampling & Criterias Excel recording tool Checkitem # Box # Marking Inner carton Mug Quantity Mug heigth Mug upper diameter Mug lower diameter Wall thickness Mug weigth Material type Quality 1 OK OK 48 104.3 64.9 3.6 326 OK OK 2 OK OK 48 103.4 64.5 4.2 346 OK OK 3 OK OK 48 104 64.6 3.9 344 OK OK 4 OK OK 48 104.6 64.8 3.8 317 OK OK 5 OK OK 48 104.3 57 3.6 308 OK OK 6 OK OK 48 104.8 61 3.8 317 OK OK 7 OK OK 48 103.7 64.5 3.9 328 OK OK 8 OK NO 48 103.8 62 3.9 345 OK OK 9 OK OK 48 103.3 64.1 3.1 322 OK OK 10 OK OK 48 103.2 63.4 3.7 325 OK OK 11 OK OK 48 104.4 64.8 3.9 317 OK OK 12 OK OK 48 102.3 64.2 3.2 316 OK OK 13 OK OK 48 105.4 63 4 316 MO OK 14 OK OK 45 105.6 65 4 322 OK OK 15 OK OK 48 106.3 65.6 4.1 357 OK OK 16 OK OK 48 103.4 65.5 3.9 311 NO OK 17 OK NO 48 104.7 64.1 3.8 300 OK OK 18 OK OK 48 104 60 3.8 342 OK OK
© 2018 Dragon Sourcing. All rights reserved. Upon production completion, daily planning ensures smooth nationwide delivery • Tight integration with supply chain teams • Transportation planning • Stock level monitoring • Anticipated dispatching to regions • Priorization of production outputs • Reactivity to market demand changes • Management of quality issues at delivery Delivery follow-up Due date: Brand Delive- ries Objec- tive Ratio achieved Region 1 Region 2 Region 3 Region 4 Region 5 Region 6 Product 1 17,488 18,022 97% 3,323 2,273 2,448 2,798 2,973 3,673 Product 2 22,138 24,500 90% 4,206 2,878 3,099 3,542 3,763 4,649 Product 3 21,797 24,139 90% 4,141 2,834 3,052 3,488 3,706 4,577 Product 4 14,991 17,789 84% 2,848 1,949 2,099 2,399 2,548 3,148 Product 5 13,010 14,180 92% 2,472 1,691 1,821 2,082 2,212 2,732 Product 6 11,867 12,016 99% 2,255 1,543 1,661 1,899 2,017 2,492 Product 7 16,586 17,525 95% 3,151 2,156 2,322 2,654 2,820 3,483 Product 8 20,106 23,287 86% 3,820 2,614 2,815 3,217 3,418 4,222 Product 9 14,011 16,580 85% 2,662 1,821 1,962 2,242 2,382 2,942 Product 10 11,060 13,228 84% 2,101 1,438 1,548 1,770 1,880 2,322 Product 11 12,895 14,288 90% 2,450 1,676 1,805 2,063 2,192 2,708 Product 12 24,923 25,131 99% 4,735 3,240 3,489 3,988 4,237 5,234 Product 13 9,869 10,058 98% 1,875 1,283 1,382 1,579 1,678 2,072 TOTAL 210,742 230,745 91% 40,041 27,397 29,504 33,719 35,826 44,256 March 10th CHINA
© 2018 Dragon Sourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
© 2018 Dragon Sourcing. All rights reserved. Supply Chain Finance Coordination of relationships between branding and purchasing teams is essential in order to bridge 2 groups with extremely different backgrounds DS Managing Director DS Account Manager Category Buying Engineer Marketing Director Marketing Services Manager Brand Manager Brand Manager Brand Manager Brand Manager Brand Manager Brand Manager Dragon SourcingCustomer Category Buying Engineer Category Buying Engineer Marketing Dedicated project team Legal Other project team Other project team Other project team Prepare contracts Organize delivery Monitor payments Category 1 Technology Productcategories Category 2 Category n … Creativity Brands …
© 2018 Dragon Sourcing. All rights reserved. The product design results from a close collaboration between Creative Agencies, Customer, Dragon Sourcing and Suppliers RFQ and Sample request Creative agencies SuppliersDragon Sourcing Product briefing Customer Quotation Sample Sample assessment Sample modification request Updated sample Final design decision Final quotation Quotation analysis and recommendations Supplier selection Consumer research
© 2018 Dragon Sourcing. All rights reserved. A Supplier day is organised once a year to strenghten relationships and communicate key messages to the qualified supply base Attendees: • Suppliers management and sales teams • Customer purchasing team • Dragon Sourcing project team Objectives • Present future purchasing trends and “sell” Customer as a strategic account • Gain suppliers’ commitment to Customer’s Corporate Social Responsibility chart • Remind suppliers of the purchasing rules of engagement • Present main contractual evolutions
© 2018 Dragon Sourcing. All rights reserved. A collaborative web tool supports a live communication on project status
© 2018 Dragon Sourcing. All rights reserved. Project status is updated automatically after each meeting Promo type DS Category Contract number Supplier Item Signed & chopped by supplier Signed by Customer Month CNY07 Printed Item V121 Supplier 1 Letter 4-Jan-07 12-Jan-07 Jan-07 POSM Printed Item V056 Supplier 2 Posters 4-Jan-2007 still not Jan-07 MAF06 Gifts J084 Supplier 5 jar 12-Jan-2007 still not Jan-07 MAF06 Gifts J085 Supplier 3 jar 4-Jan-2007 still not Jan-07 flow material Glass J086 Supplier 1 Wine glass 15-Jan-2007 still not Jan-07 flow material Gifts J087 Supplier 4 Watch 10-Jan-2007 still not Jan-07 MAF06 Gifts J091-1 Supplier 3 Camera 2-Jan-2007 9-Jan-07 Jan-07 MAF06 Gifts J091-2 Supplier 4 key ring 11-Jan-2007 9-Jan-07 Jan-07 Gifts V019 Supplier 2 passort holder 2-Jan-2007 Jan-07 MAF06 Gifts V020 Supplier 5 back pack 22-Jan-2007 no Jan-07 MAF06 Gifts V021 Supplier 3 Camera 23-Jan-2007 still not Jan-07 MAF06 Gifts V022 Supplier 1 Gym bag 17-Jan-2007 no Jan-07 MAF06 Gifts V023 Supplier 4 back pack 26-Jan-2007 still not Jan-07 events Gifts V025 Supplier 3 Gym bag 26-Jan-2007 still not Jan-07 events Gifts V026 Supplier 4 key ring 26-Jan-2007 still not Jan-07 MAF06 Gifts V040 Supplier 2 manicure kit 16-Jan-2007 Jan-07 MAF06 Gifts V064 Supplier 5 passort holder 15-Jan-2007 Jan-07 Gifts W095 Supplier 3 plastic pen 23-Jan-2007 19-Jan-07 Jan-07 Gifts W096 Supplier 1 Gym bag 12-Jan-2007 still not Jan-07 Gifts W097 Supplier 4 Travel bag 8-Jan-2007 still not Jan-07 Gifts W098 Supplier 3 back pack 16-Jan-2007 still not Jan-07 Gifts W099 Supplier 4 Ice bucket 16-Jan-2007 no Jan-07 Gifts W100 Supplier 2 key ring 15-Jan-2007 18-Jan-07 Jan-07 Gifts W101 Supplier 5 manicure kit 29-Jan-2007 24-Jan Jan-07 Gifts W102 Supplier 3 passort holder 15-Jan-2007 still not Jan-07 Gifts W103 Supplier 1 plastic pen 23-Jan-2007 still not Jan-07 Gifts W104 Supplier 4 tent card 5-Feb-2007 still not Feb-07 Gifts W105 Supplier 3 plastic pen 5-Feb-2007 17-Jan-07 Feb-07 MAF06 Gifts J088-1 Supplier 4 passort holder 12-Feb-2007 no Feb-07 flow material Gifts J088-2 Supplier 2 Gift box additional order 2-Feb-2007 Feb-07 flow material Gifts J088-3 Supplier 2 standee 6-Mar-2007 Mar-07 Supply Contracts managed by Dragon Sourcing - Starting May 2005
© 2018 Dragon Sourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
© 2018 Dragon Sourcing. All rights reserved. Budget and current spend evolution 0 10 20 30 40 50 60 70 80 90 2004 2005 2006 Budget Actual spend Despite double-digit budget increases and increases in product quality requirements, the actual spend has been maintained below the initial budget Double-digit budget increase Double-digit budget increase-25% -20% Outsourcing to Dragon Sourcing
© 2018 Dragon Sourcing. All rights reserved. These results have been achieved by having to sometimes fundamentally change the client’s sourcing strategy, e.g.: Glass products where 40% savings have been achieved Strategy element Current Client strategy Recommendation for the future Rationale Creative agency vs. manufacturer • Creative agency • Direct to Manufacturer • Agency not competent in procurement but in creation • No incentive to optimized total ownership costs • Very high commission fees (over 20%) • Negative taxes impact • Direct link with Manufacturer provides better cost / quality optimization at design stage Technology segmentation • Per Brand • Per technology (Glass, steel wood, leather, etc.) • Consolidated volume to a reduced supplier base Contracting • PO Driven • Annual, frame contracting • Simplify ordering process • Agree key contractual issues (payment terms, tools ownership, etc) • Provide suppliers with better visibility into client requirements • Intellectual property
© 2018 Dragon Sourcing. All rights reserved. In addition to these significant savings, other soft benefits have been achieved after nearly two years of collaboration • Total transparency over sourcing process and supplier base • Greatly reduced supply chain risks such as CSR or product availability • Improved Quality of the spec and to the spec • Reduced time to market • Internal Marketing team totally focused on higher value added activities • Customer plans to enlarge scope of work in the future and to extend these benefits to: – Other categories such as logistics or indirect purchases – Other supply markets such as South-East Asia, e.g. Vietnam – Other company subsidiairies to leverage the Chinese supplier base globally
© 2018 Dragon Sourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China 5. Other credentials
© 2018 Dragon Sourcing. All rights reserved. Successful Sourcing in China • Adopt strategic approach vs. tactical approach – No leverage back mentality – Follow through with real orders vs. benchmarking only • Sell your « buy » to the Chinese suppliers – High quality suppliers are in high demand – Build credibility in your sourcing program with the suppliers • Enterprise wide approach with top management support vs. Procurement only – Internal change management is often the toughest challenge – Involve Marketing, Quality, Engineering, Manufacturing from the beginning (mix function of categories) • Dedicated professionals vs. User/buyer model – Don’t try using local buyers to manage « export » business • Start with high potential/low risk categories on a pilot basis to generate rapid success – Rigorous analysis of spend portfolio to identify best candidates • In Sourcing cycle per se, use same professional process rigor as in the West – Don’t believe that it’s only a « relationship » game
© 2018 Dragon Sourcing. All rights reserved. The following cost framework helps explain, differences in procurement philosophies between Japan and the West Cost Driver Framework Structural Inherent Realized • Cost driven by the selection of the supply base e.g.: – Factor cost – Scale effect • Costs driven by design decisions and by the selection of the manufacturing process • Costs driven by the on- going operational performance of the supplier Castings Example Average cost/kilo by country Mould yield ratio Operational metrics 42,5 44,5 46,5 48,5 50,5 52,5 54,5 56,5 58,5 60,5 C zech R epublic Poland H ungary C anada France U nited Kingdom Sw eden Finland U nited States N etherlands Italy Belgium D enm ark Australia JapanSw itzerlandG erm any Averagecostperkg(measure/kg) The Client average cost 17% 15% 14% 6% 6% 2% 2% 1% 1% 1% 0% 0% 1% 2% 2% 8% 10% 55 Change of: • Labor cost • Energy cost • Transportation cost • Interest rates 0 0,5 1 1,5 2 2,5 3 3,5 4 4,5 0 1000 2000 3000 4000 5000 6000 7000 The weight of the article (grams) Themouldyieldratio Supp. C, Engine Bracket Supp. C, Engine Bracket Supp. A, Camshaft housing Supp. B, Oilsump Averagecostperkg(measure/kg) The Client average cost 42,5 44,5 46,5 48,5 50,5 52,5 54,5 56,5 Improved casting labor productivity Full utilization Reduced burnoff Reduced scrap rate Reduced mould yield ratio 8,9% 9,3% 10,1% 10,6% 12,8% 55 Averagecostperkg(measure/kg) The Client average cost 42,5 44,5 46,5 48,5 50,5 52,5 54,5 56,5 Improved casting labor productivity Full utilization Reduced burnoff Reduced scrap rate Reduced mould yield ratio 8,9% 9,3% 10,1% 10,6% 12,8% 55
© 2018 Dragon Sourcing. All rights reserved. Potential China Model Western Japan Competitive pricing Relationshipmanagement Japanese Model (Keiretsu) Western Model Sourcing Model Matrix China’s ambition in procurement can be and must be to leapfrog the West and Japan

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Global emerging markets sourcing through procurement sub contractors

  • 1.
    Company Presentation Feb 2018 DragonSourcing - 龙 源 Delivering sustainable sourcing value from emerging markets
  • 2.
    © 2018 DragonSourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China
  • 3.
    Procurement Intelligence todeliver you insight into markets to enable effective procurement decision. Global Sourcing to identify, qualify & secure capable and competitive suppliers in emerging markets. Procurement Outsourcing of IPO’s (international procurement offices) to increase productivity, reduce risks and fixed costs and rapidly scale up Procurement Capability Enhancement to Improve the productivity and effectiveness of your procurement function in emerging markets, especially in China © 2018 Dragon Sourcing. All rights reserved. Dragon Sourcing’s Suite of Offerings
  • 4.
    Our suite ofProcurement Intelligence Offerings covers the full information requirements of Procurement Departments © 2018 Dragon Sourcing. All rights reserved. 4 CLIENT BENEFITS Clarifying Supply Chain Risks Discovering Market Opportunities Informed Buying Decisions PROCUREMENT INTELLIGENCE SUITE Supply Market Analysis Supplier Analysis Industry Best Practices Analysis Price Tracking & Forecasting Category Executive Dashboards Dynamic Should-Cost Models Value Chain Analysis Supplier Financial Assessment Supplier Ethics Assessment - Which countries have potential? - Should we buy-in or manufacture? - Who are the top suppliers? - What are the market dynamics? - Should we buy now or later? - Latest category news? - What will the impact of inflation be? - Is the market trending up? - What are the raw materials? - What are the key risks to supply? - Do these suppliers meet our CSR requirements? KEY CLIENT QUESTIONS
  • 5.
    • Analyse spendcategory 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, ADT,..) • Develop Business case and implementation plan • 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 © 2018 Dragon Sourcing. All rights reserved. Our suite of Sourcing Offerings covers the end-to-end sourcing process Value Discovery 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
  • 6.
    © 2018 DragonSourcing. All rights reserved. Capability Assessment: Improve the effectiveness of your procurement organization 6 1. Assessment 2. Implementation 3. Execution To assess the current situation of the procurement organisation and the demand, and identify the improvement opportunities. 1. Data collection through workshops and questionnaires to gain clarity on the current state and demand. 2. Interviews with staff to determine current roles, understanding of mission & capabilities. 3. Analysis & reporting of the current state, the demand, and the areas for improvement. 4. Draft a detailed plan for implementing and communicating the improvements. 5. Review and approval by stakeholders on the improvements and the implementation plan. To develop and implement the organisational improvements. 1. Develop the new org model, processes, tools, roles & policies. 2. Recruiting for capability gaps & training staff in new roles. 3. Defining a 12 month operating plan. 4. Communicating and formalising launch of the new organisation model. To reinforce the improvements and deliver the first cycle targets. 1. Tracking the adoption of the new tools, processes and policies. 2. Supporting behaviour change with side by side support. 3. Augmenting sourcing projects where there are temporary capability or capacity gaps. Deliverables • Analysis report of current situation and recommendations on the opportunities for improvements • Implementation plan • Communication plan Deliverables • Organisational model • Process documents • Tools, templates & policies • Role descriptions • Recruited staff • Trained staff • 12 month operating plan Outcomes • Reduced overheads • Higher productivity • Increased sourcing savings • Reduced contract leakage • Separation of duties • Increased visibility & control • Focus on value add activities
  • 7.
    London Paris Graz Ljubljana Warsaw Budapest Istanbul Tel Aviv Mumbai Shanghai HongKong Ho Chi Min City Bangkok Jakarta Johannesburg Melbourne Sao Paulo Mexico City Houston Addis Ababa Prague Kiev Bucharest Riga Manila Lagos Rosario Nairobi Brussels We can cover global emerging markets through our owned offices and our network of procurement sub-contractors © 2018 Dragon Sourcing. All rights reserved. 7 Geographies covered by DS network of procurement subcontractors Santiago Sales offices Buying offices Novosibirsk Myanmar Cambodia Rome MadridMilan Porto Kuala Lumpur DammamCairo
  • 8.
    Service and Pricing DragonSourcing - Service Offerings Pricing DS Inhouse Outsourced Standard Comment Market Intelligence Procurement Intelligence x Fixed fees according to price list Should Cost Model x Supplier Financial Assessment x Supplier Supply Chain Assessment x Supplier Ethics Assessment x Category Executive Dashboard x Country and Manufacturing Site Evaluation Country Selection x Customized fixed fees based client's needs Country/Region/City Analysis x Factory ramp up support x Global Sourcing Portfolio Analysis & Category Prioritization x Fixed fees according to price list We can offer performance related deals (gain sharing, commissions, trading). Deals are structured on a case by case basis based on (1) spend value, (2) types of categories and (3) nature of the work required by the client; For Long-term Projects / High workload Projects, we move away from our standard pricing approach based on # of categories and # of countries to projects. Identification of potential suppliers (RFI process) x Measuring cost competitiveness of suppliers (RFQ process) x Auditing x x Sample development and testing x x Supplier development x x Contract negotiaton x Procurement Operations QC Management x x Fixed fee based on daily billing rateLogistics Management x Payment / Invoice management x Outsourcing Interim Management x (Buyers) x (SQE, SDE) Fixed fee based on monthly billing rate IPO Management x Fixed fees based on team size Performance related deals are possible to be crafted on a case by case basis © 2018 Dragon Sourcing. All rights reserved.
  • 9.
    © 2018 DragonSourcing. All rights reserved. In summary our key differentiating points are: • Our ability to provide and end-to-end service from Procurement Intelligence through to Procurement Operations • A business model which ensures that we work exclusively for the benefit of the buyer • Total transparency and sharing of information with the client • Deep procurement process and category expertise combining operational and consulting skills allowing us to provide high quality service across a wide range of categories • An engineering and technical background combined with a deep understanding of industrial B2B buying practices and requirements • Global Footprint allowing us to effectively tap into all emerging market opportunities
  • 10.
    © 2018 DragonSourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China
  • 11.
    © 2018 DragonSourcing. All rights reserved. Our clients are medium to large size corporations across a wide range of industries Food & Beverage Construction DIY Industrial Products
  • 12.
    © 2018 DragonSourcing. All rights reserved. Our clients are medium to large size corporations across a wide range of industries Service Retail Heavy Machinery Automotive Packaging Pharma / Medical Energy/Chemicals Consumer Goods Government Mining
  • 13.
    For these clientswe have successfully sourced (or are in the process of sourcing) an extensive set of spend categories –Whisks –Cooking items –Bowl –Cast Iron French Oven –Soft Grid Handle –Cast Iron Roster –Oval Plate in Teflon –Water filter –Opal Glassware –Tong –TPE Lasagna Lid –Cast Iron Saucepan –Fondue Set –Elegant plastic plate –Cast Iron Braiser –Vacuum Thermos Bottles • Kitchenware –Melamine dishes –Nylon Spatula –Cast Iron Skillet –Oval Baker –BBQ –Lock Lids –ABS handle/silicon handle Finished goods for retail –Self inflating air mattress –Sleeping bag –Towel / Beach towels –Underwear –White Tshirts –Work wear –Blouse –Padded Jacket –Comber cotton waste –Casual shoes,boots,sandals –Napkin/ Table Cloth –Pillow –PP non woven uniform –PU Boots –Canvas Shoes –Quilt –Coat –Silk Dress –Ladies’ Blazers –Made ups (Linen) –Plaids –Semi finished artificial grass carpet • Textile –Baby wear –Blanket –Carpets –Duvet cover –Socks (Lady, Men) –Jeans –Thermal suit –Egyptian cotton CVC white bleached fabric –Burmuda short – stock lot buy –Shopping Bag –Shopping Basket –Shopping Trolley –Sound Ball –Stones and Marble –Wicker Basket –Stand –Microsign –Baking tray –Plastic trays –Christmas decoration –Deko Spring –Door Sign –Double loop hook –Loop Hook –Magnet –Metal floorstand –Dump bin –Wooden crate –Podium – Fruit liner –Cosmetic display • Goods not for resale －Acrylic Menu Holder －Black hook －Cardboard display －Ceramic products (cup Teapot, Plates) －Counter unit －PVC pocket －Poster stand －Roller scroll －Wire Shelving －Ice cream scoop –Sonic Toothbrush –Tooth Brush –Tooth Floss –Toothpick –Elastic enhanced wrist support –Elastic knee support (4 ways) –Powder free examination glove –Adjustable Medical Chair –Fish Oil –Hand Soap –Hot Water Jar –Moisturizer –Crutch –Ankle support –Neoprene knee support –Electric toothbrush –Deluxe functional lumbar support –Manual toothbrush with blister • Healthcare –Bath Gel –Body care wet wipes –Conditioner –Soft pad elbow brace –Elastic wrist brace –Elastic elbow support –Neoprene waist belt –Elastic ankle support –Knee support –Neoprene ankle brace –Shampoo –Household wet wipes –Humidifier –Luminaries –Misting Lamp –Plastic scoop –Dishwashing brush –Energy saving lamp • Household –Air freshener –Aroma diffuser –Battery Alkaline –Tray –Cloth pegs –Clothes line –Thermos pot –Vase –Wicker basket –Fridge magnet –Tong –Sardines in tomato sauce –Swordfish steak –Tuna steak –Vannamei –Whole Clean Octopus –Red Chilli –Tomatoes –Canned Pineapple –Nut (Peanuts and Cashew) –Pangasius –Whole Clean Squid –Broth Cubes –Wet Noodle/Sauce in Pouch –Noodle/Pasta Cup • Food –Baby Corn –Baby Cucumber –Block of White Sesame Candy –Canned Papaya –Pickled Cherry –High Chair –Toys –Cloud travel cot –Color Book –Diapers –wipes • Baby products –Bottle Sterilizer –Model car –Folding booster •Furniture −Steel Patio Furniture −Rattan Patio Furniture −Outdoor furniture –Vanity –Chair –Wooden furniture －Wicker furniture －Compactus －Office chair • Shoes –Vulcanized shoes –Children EVA sandals –Casual shoes –Rain boots –Surf – lady –UGG boots –GUM boot –Hiking boot –Sauna slipper –Doble pulgger –Surf – man －Outdoor hikers －Children boots －Snow boots －Children beach sandals –Sandwich bag –Soft Tissue Paper –Cardboard Binder –Seafood tray –Trash bag –Touch screen –Tent –iPad stand –Twisted pearl necklace –Bag –Crab pot –PE tarpaulin –Silver drop necklace –Car mat –LED candle –Paper Cup –Plastic Bags –PS Cup –Cup holder –Snap frame –White board markers and clips –Opera house –Black hand bag –Perfume pump –Brass bell with ropes –Shopping basket –Printing postcard, booklets.. –Shoe bag –Kids Bike in aluminium • Consumables –Container bin bag –Deep freezer bag –Book divider –Light box –Light box difital hand tally counter –Yogo mat –Battery –Winter scarf –Sear cover –Satin Wrap –Fixture –Plastic box –Cord bag –Flat bag
  • 14.
    For these clientswe have successfully sourced (or are in the process of sourcing) an extensive set of spend categories Laboratory items Packaging • Consumables –Beakers –Brown glass bottles –Caps bouffant –Conical flask –Corundum crucibles –Coverall –Count Tact Box –Disposable centrifuge tubes –Disposable latex gloves –Disposable nitrile gloves –Disposable plastic dropper –Disposable sterile masks –Disposable syringes –Drip tube –Graduated cylinders –Halfline measuring cups –Hollow glass stopper –Jerricans –Mechanical stopwatches –Mercury thermometer –Micro plates –Paper wiper –Petri dishes –Pipette tips –Plugs –PTFE magnetic stirring bar kit –Shoe Cover –Stainless steel medicine spoons –Testtube brush –Two neck flasks –VIDAS plastic Barrett –VIDAS plastic container –Wash bottles –Wide mouth plastic bottles –Wrist cuff –Tongue depressor –Swab –Irradiation label –Extensive pH indicator paper –Funnels –Gloves –Tongue depressor –Tubes –Ear washing bulb • Equipement –Walk in Fume hood –Wide Fume hood –Racks –Autoclave –Sealing machine –Precise peristaltic pump –Haier freezer for pharmaceutical industry –Water heater –Laminar flow cabinet –Freeze dryer –Stainless steel chair –Marble table for lab –Steel shelf –Cabinet –Vortex mixer • Plastic –Bread bag –CD Box –Film –Freshness box –Innerfoil –Intermediate Bulk Containers –Multilayered and Coextruded Films –Multilayered and Coextruded Plastic Films –Plastic Pallets –Plastic box –Hangsell –Thermal sealable cellophane –Wine Bottle Capsule –LDPE foam –Plastic bags –Plastic bubble wrap –U shape edge protector –Plastic rigid bottles, caps –Plastic rigid tubes –Carton box handle –Woven Plastic Sacks –Shopping bag –Garment bag –Cardboard bin with plastic tray –Strawberry container –Adidas tray –Brochure holder –Menu holder –Printing Film on Reel for Food Industry –Plastic rigid jars • Paper –Carton for Food Industry –Chocolate Boxes –Corrugated Packaging –Cardboard box 7 layers –Labels for electronic devices – Lables and print –Hamburger box –Hot Chip Box/Hot beverage cup –Multilayered Paper Sacks –Filter paper • Wood –Wine Bottle Cork Stopper –Wine Boxes –Wooden biscuits box –Lumber –Fasteners –Stainless steel box • Metal –Beer kegs －Tin Boxes Construction Materials MRO Raw Materials Production Equipment - Cupper - Can bodymaker - Washer - Decorator - Pin Oven - Sprayer - Necker - Empty can palletizer - Hydraulic Press machine - Shell press - Conversion system - Liner - Conveyer - Dryer - Shell balancer - Auto bagger - Vessels - Screen printing equipment - Inverter - Agitator - Pipe line - Rotary dryer -Round seamless steel bar -Cathode Bar -Activated Carbon -Silicon metal -Silicon metal HP -Steel wire cordage -Steel wire -Potassuim Amyl Xanthate -Sodium sulfide -Sodium chlorate -Potassium permanganate -Aluminum fluoride -Benzoin Gum -Ammonium sulfate –Haz Mat Shoe Boot –PVC industrial gloves –Nitrile industrial gloves –Safety glasses –Coverall –Protective glove –Welding Helmet –Headband –Tear away mesh –Beach hats –Cooling bandanas –Boot steals –Sunscreen Lotion –Earplug –Anti fatigue Mat –Work wear –Cool Cap –Baseball Bump Cap –Protective Clothing –Duct tape –Helmet Lens –Respirator –Protective Eyewear –Cut resistant glove -Wire Mesh - Aluminum laminate - Fiberglass tissue - Tack strip - Concrete Accessory -Agriculture Product -Metal Lath -Wood flooring -Organic fiber -Zamak handle -Wire rods -Steel Wire -Cable Ladder - Plywood - MDF (medium density fiberboard) - PTB (Particle board) - Nail - Moulding -Laminate flooring -Drawer side -ABS handle with aluminum finishing -Plywood -Steel -Cable Channel -Resin Basin -Deformed steel rebar in coil & Straight length -Southern yellow pine -DWI Aluminum Can Raw Materials: inks, Ultra premium® exterior paint, Basecoat, Premium spray paint, Sealant compound -T6 6060 Aluminum extruded profiles -Steel Angle -Cable Tray • Glass –Alcohol bottles –Beverage bottles –Food Jars –Pharmaceutical bottles & vials –Cosmetic bottles –Wine bottle and outer carton
  • 15.
    For these clientswe have successfully sourced (or are in the process of sourcing) an extensive set of spend categories Industrial items –PVOH (Polyvinyle Alcohol)Fully hydrolysed –DINP di-isononyl phthalate • Industrial Plastic –PVB film for automotive glass –PVB film for Construction, building glassPVB resin for PVB film manufacturing • Tools –Hand saw –Scrapers –Steel Wire brush –Tool Case –Utility knife –Wall brush –Tapes –Staples • Supporting range –DIN Rail –Perforated strips –S Hooks –Steel chains –Suspension Hooks –Threaded rod • Grounding range –Brass connector –Cloverleaf rod closed clamp –Cloverleaf rod flat clamp –Connecting bolt –Cross shape rod with bolt –Derivation connector –Earthing clamp –Isolation bar –Round rod closed clamp –Round rod flat clamp –Striking head –Threaded copper round rod –Cable terminal –Cable tie –Cable attachment • Connecting range –Christa’l terminal –Heat Sink –Low current connectors –Peltier element –Power cord –Terminal for lamps –Terminal strip black Do it Yourself items • Electrical –AWG wire –Cable sleeve –PCBA –EMT straps / Couplings –Electric racking –Electric switches –Electric protection –Electric cable –Electric lighting –Electric ground rod –Electric general －Plastic Injection: Wheel joint for Baby trolley, ABS and PP , Luggage wheels, Coffee Machine parts, winddeflector, front beam, Black hook, Curved shelf, Plastic number, Rota vials, HIV vials, FOB vials, Fasteners & Springs • Processed Technologies –Castings: exhaust, In queue product parts, Axle Housing Assembly, Coffee Machine parts; Hollow Steel Structure; Steel structure for solar panel; Counter weight filler bit, Meat mincer, Heating block, Die casting assy axle, insert, Cast PU components, Cast AI components –Extrusion: Aluminum extrusion parts, Baby trolley parts, Alu-alloy part , Data strip, Railshaped ruler –Metal Cutting and Melding: Hollow steel structure, Steel structures for solar panel –Stampings: Bread Pans for Automated Ovens, Steel Containers, Steel Containers Coffee Jug, In queue product parts, Industrial Boiler Components, Lamp armature, Stainless steel display tower, glass reinforcement, spring wind deflector, Safety bar -Forging Lower tube sheet, Gears, Shaft Axle, Custom hot rolled steel profiles –Hot Rolled Wire –Mud Stay –Plastic Bread Trays –Stainless Steel products –Tractor –U bolts –UTube –Water tank –Ductile Iron Pipe and fittings –Car window channel –Wire fence –Carcass Light Box –Electric and gasoline generator –Solor motor –Invertor –Brass roller buckle –Steel basic frame –Solenoid –Speaker –Transformer –Filter –Electro-magnets –Pump –Ni Magnet –Ball Valve –Surge Protector • Finished products –Bread tins –Bus bumpers –Car batteries –Coffee Machine –Cutting knives –Electric aerosol dispenser –Fasteners –Fifth Wheel –Flame detector –Tungsten wire –Grinding media –Magnet –Double loop hook –Wind Turbine Permanent Magnet Generator/Alternator –Brass lock –Twist lock with fixed hinge –Engraved padlock –Full zipper puller –Brass rivet –Zinc alloy hook –Plumbing –Membrane keyboard –Gauge –Neck Printing Machine –Metal Bracket –Handbag/Luggage lock&puller –Composite tube –Motor assembly –Universal AC motor for Food Processing Machine –Sheet metal – ATB reader –Machining – ATB reader –Turned parts – ATB reader –Conduits –Battery charger –Battery –Brass padlock with two keys –Twistlock –Padlock –Buzzer –Electric motor –Electric motor for water filtration system and GE appliance –Flanges & Fittings –HVAC –Printed circuit board –Aluminum sheets –Fin Stock real • Road Transportation • Travel agencies • Airlines • Warehousing • Creative agencies • Legal Service Services
  • 16.
    For these clientswe have successfully sourced (or are in the process of sourcing) an extensive set of spend categories Chemicals and Food Ingredients –Acetonitrile 99.9+% 0.782g/mL (Methyl cyanide) for HPLC gradient analysis CertiFied HPLC –Acetone (Propanone) –Metanol grad. Hplc –Methylene Chloride Optima –Dichloromethane 99+% (GLC) stabilised with 0.005% amylene SpeciFied –Heptan-n 99,5% pa –Ethyl acetate cert acs/hplc –Acetonitril –"Blood Agar" –Tetrahydrofuran 99.5+% (GLC) stabilised with 0.025% 2,6-di-tert- butyl-p-cresol –iso-Hexane contains < 5% n- hexane for HPLC CertiFied –Hexane optima grade –Hexane cert acs/hplc –Xylene –Tryptic Soy Broth • Pharmaceutical –Water 0.1% tfa –Dodecyl Sulfate Sodium –Ethanol 99.8+% (GLC) 0.7897g/mL absolute (Ethyl alcohol) for analysis CertiFied AR –Dimetylsulfoxid –Human Serum –Horse Serum –Sulfuric acid –Brucite –Turpentine- Myrcene –Turpentine- Citronellene –Turpentine-Alpha-Pinene –Turpentine- Beta-Pinene • Industry –Calcined bauxite –Vitamin A 1000 IU Retinol –Vitamin B1 –Vitamin B12 –Vitamin B2 –Vitamin B3 –Vitamin B5 –Vitamin B6 –Vitamin B9 –Vitamin C Acid Ascorbic Dried –Vitamin C Stabilised 35% –Sorbitol esters –Soya Protein –Tartaric acid –Taurine –Tetra Potassium Pyrophosphate (TKPP) –Tetra Sodium Pyrophosphate (TSPP) –Titanium dioxide (TiO2) –Tri calcium Phosphate –Trilon A92 (Chelating agent) –Trilon B (Chelating agent) –Vitamin A - All-trans-retinyl acetate –Glycine –L-cysteine –Lecithin –Liquid Caustic Soda –Milk –Mono calcium Phosphate –Phosphoric Acid (75%) FCC –Phosphoric Acid: 80%, –Potassium Sorbate –Propionic acid –Sodium Stearoyl lactylate –Sodium Tripolyphosphate (STPP) –Sorbic acid –Vitamin E (VE) • Food and Animal Nutrition –80% Sulphur DF and 20% Mancozeb WP –Benzoic acid –C8 10L Fatty Acid –Calcium Propionate –Caustic Potash –Caustic Potash (Liquid) –Caustic Soda Pearl –Citric acid –Di calcium Phosphate –Dicalcium Phosphate (DCP) –Glycerine (Palm/Coconut derived) –Xylose –Sodium Phosphatemonobasic –Sodium Thiocyanate –Sucrose –Tartrazine Acidyellow 23 –Thimerosal –TMB . 2HCl . 1H2O –Trans-Cinnamaldehyde –Trishydroxymethylamino methane –Triton X-100 –Urea HydrogenPeroxide –Variquat 56 –Zwittergent 3-14 –Mops(morphol.Prop.Sulf onic Acid) –White/vory Beeswax –Antimony Oxide –RBD LLP –Poly ethylene Glycol (Macrogol 8000) –Polysorbate 20 –Potassium dihydrogenphosphate –SERMUL EN 9 –Sodium Hydroxide –Sodium Carbonate –Sodium ChlorideType A –Sodium citratedihydrate –Sodium Hydrogen Carbonate –Sodium Iodacetate –Sodium phophatemonobasic monohydrate –Sodium phosphate dibasic dihydrate –Goat anti rabbit antibody & goat anti mouse antibody –Coconut Oil –Emdex –Eryoglaucine –Erythrosin B –Ethanol 96% denatured (5%Methanol) –Ethanol Type A (96% v/v) –Gentamicin sulfate salt –Glycine –GuanidineThiocyanate –HEPES free acidULTROL Grade –Horse Radiche Peroxidase Grade II –Hydrochloricacid 37% –Iron(III) chloride Hexahydrate –Kathon CG Biocide –Linalool –Bile salts –Albumin prepared from Human plasma • Biological –2-Chloroacetamide –2-Chloro-N- (hydroxymethyl)acetamide –alpha,alpha-TrehaloseDihydrate –Amaranth –BromocresolPurple –Calcium Chloride dihydrate –Citric acid Monohydrate –CTAB –Dextran Blue –Dextran T40 –Disodium EDTA dihydrate reagent (ACS) –DL-Dithiothreitol –NASBA Lysis buffer 500 ML –Mannitol reagent (ACS) –Sheep blood –Organic Stearic Acid Promotional items • Gifts –Electronic gadget: Photo frame, USB Key, Flashlight…. –Premium:Lighter, key ring, money clip… –Umbrella and parasols –Wine related gifts: cooler wine bottle ring, bottle opener, parkling cork, wine standee, wine bucket, Vacuum stopper… –Writing instruments: Notebook, ball pens… –Plastic diffuser and LED • Display –Cardboard display –Light box –Metal display –Plastic display • Glasses –Bar accessories: Decanter, Jug, Water carafe, Ice bucket… –Glasses: Cognac glasses, Wine glasses, Whisky glasses, Cocktail glasses, Champaign glasses… • Luggage and Textile –Backpack –Bags –Luggage –Textile: Uniform, Apron, Towel set, Jacket • Printing & Boxes –Brochures –Christmas cards –Gift boxes –Shopping bag –High temperature resistant spray paint
  • 17.
    © 2018 DragonSourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China
  • 18.
    © 2018 DragonSourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
  • 19.
    © 2018 DragonSourcing. All rights reserved. Context • Major global FMCG company producer – Presence in over 70 countries, including Europe, Asia and America – 18,000 employees worldwide – Approx $8 billion turnover – 15 key brands accounting for 70% of total turnover • Effective management of marketing spend requires to overcome several challenges: – Double digit growth in BTL marketing budget (approximately RMB120M/year) – Communication within a complex decentralised organisation (brand driven) – Collaboration between employees with very different backgrounds – Relationship with creative agencies for product design – Peak demand and short time to market – Reactivity to frequent design change requests • Decision to outsource BTL marketing/promotional procurement in 2005 to Dragon Sourcing
  • 20.
    © 2018 DragonSourcing. All rights reserved. Major trends in marketing services in China • Use rigorous sourcing methodology as in the industry to manage creativity profusion, short time to market and non recurrent purchasing • De-aggregate supply chain between creative agencies and manufacturers • Set up IPO or use PSP in China instead of traders in Europe to buy directly from manufacturers • Look for value-added suppliers providing innovative solutions vs standard catalogue items • Increasingly focus on CSR and environmental issues in supplier selection process • Sourcing diversification outside China (e.g.: Vietnam) to leverage even lower cost suppliers
  • 21.
    © 2018 DragonSourcing. All rights reserved. Marketing spend includes all goods typically designed by creative agencies, such as gifts, boxes or glasses GiftsStandees Boxes Glasses
  • 22.
    © 2018 DragonSourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
  • 23.
    Dragon Sourcing manages,for all BTL categories, the whole sourcing process… • Negotiate contract with supplier • Facilitate supplier and customer signatures • Monitor down-payments • Follow production quality • Organize delivery • Manage quantity variation effects • Organize final payment • Measure supplier performance • Collect product design proposals from creative agencies • Forecast future volumes and consolidate requirements • Manage RFQ process with all qualified suppliers • Collect supplier samples and refine final product design • Update supplier quotations • Negotiate and select supplier © 2018 Dragon Sourcing. All rights reserved. Contracting, Production & Delivery Product design & Supplier selection Supplier qualification & Supply base management • Monitor supply markets • Qualify potential new suppliers through an RFI and « theoretical » RFP process • Analyse responses and « identical » samples • Audit suppliers • Follow current supplier performance • Set up list of qualified suppliers – Introduce new supplier in base – Eliminate poor performing current supplier
  • 24.
    © 2018 DragonSourcing. All rights reserved. … for approximately 350 discrete sourcing projects driven by 2 major annual events: Mid-Automn Festival and Chinese New Year Monthly spend evolution M ay-05June-05July-05 August-05 Septem ber-05 O ctober-05 N ovem ber-05 D ecem ber-05 January-06 February-06M arch-06April-06M ay-06June-06July-06 August-06 Septem ber-06 O ctober-06 N ovem ber-06 D ecem ber-06 January-07 February-07 Mid-automnfestival ChineseNewYear Mid-automnfestival ChineseNewYear
  • 25.
    © 2018 DragonSourcing. All rights reserved. The RFI/RFP and “identical sample” process result in a short-list of potential new qualified suppliers Pre-qualified suppliers Potential new qualified suppliers Potential suppliers Qualification of suppliers through RFI/RFP RFI/RFP process Sampling process Analysis of offers and samples Potential Supplier 1 Potential Supplier 2 Potential Supplier 3 Current Supplier Price Prod. 1 26.4 23.8 24.9 24.6 Prod. 2 36.1 33.8 34.9 33.7 Prod. 3 13.4 15.1 12.2 12.8 Prod. 4 40.2 38.1 41.3 38.4 Region Jiangsu Zhejiang Shanghai Shanghai Turnover (M€) 6 14 8 19 Staff 350 700 430 880 Capabilities 100/day 120/day 75/day 140/day Cooperation Good Good Average Good Samples
  • 26.
    Objectives • Meet topmanagement and sales management teams • Present product requirement and order details • Understand organisation and processes • Refine offer understanding • Validate manufacturing capabilities • Visit factory and check work conditions Topics • General Management • Order management • Shipping / packaging • Planning process • Goods flow • Procurement • Purchasing • Production • Quality © 2018 Dragon Sourcing. All rights reserved. This shortlist is then audited in order to finalise the qualification process Audit questionnaire Audit report Audit summary
  • 27.
    CONTACT INFORMATION 联系资料 B+ Response评分 Comment 附加 评语 Response 评分 Comment 附加评 语 Yes/No 被取录/ 不取录/ Comment 附 加评语 V019 estate catalogue Jul-06 Not needed, known supplier 常用供应商 Yes, on time 守时收到 Yes 有 Yes 有 V020 shopping bag Jul-06 Not needed, known supplier 常用供应商 Yes, with delay 迟受到 No 没有 No 没有 V021-V050 mini brochures Jul-06 Not needed, known supplier 常用供应商 Yes, on time 守时收到 Yes 有 Yes 有 A Required 计划时间 Actual 实际时间 V019 estate catalogue Jul-06 10 11 1 Low 低 V020 shopping bag Jul-06 20 23 3 Low 低 V021-V050 mini brochures Jul-06 20 20 0 Low 低 A Contract number Items Date (mm/yy) 日 Proposed alternative (yes/no) 有否提供建议 Impact of proposal 建议重要 V019 estate catalogue Jul-06 Yes 有 High 高 V020-V039 shopping bag Jul-06 No 没有 N/A 不应用 V021-V050 mini brochures Jul-06 No 没有 N/A 不应用 A+ Contract number Items Date (mm/yy) 日 Quality issues (yes/no) 质量 Issue Criticality/ Impact 质量重要性 V019 estate catalogue Jul-06 No 没有 Low 低 V020 shopping bag Jul-06 No 没有 Low 低 V021-V050 mini brochures Jul-06 No 没有 Low 低 INDUSTRY 行业 QUALITY PERFORMANCE (Other issues than delay) 服务性质量评分 （不包括送货延误事情） PROACTIVENESS 前摄能力 (Good supplier should constantly propose alternative technology or cost-cutting options without jeopardizing quality and appearance / 好供应商应经常事先提出新的生产法案和改良方法) Contract number Contract number RESPONSIVENESS IN PARTICIPATION TO RFx / COMPETITIVENESS 回应效率 / 竞争力 Shanghai xxxxxxxxxxx Co Ltd Paper No 2,Lane xxx, Xxxxx Road Shanghai Address 地址 City / Town 城市 SUPPLIER PERFORMANCE TRACKING 供应商项目评分 SECTOR 分类 Printing COMPANY NAME 公司名字 General Manager Manager Assistant Mobile phone 手机号码 cd@xxxx.comab@xxx.comEmail 电子邮址 RFQ stage 报价阶段 139xxxxxxxxx 131xxxxxxxxxxx Recommended to the client 已推荐 给客户 Date (mm/yy) 日 期 （月/年） Comment 附加评语 Delivery lead-time (days) 生产期 （天） Selected for negotiation after RFQ 报价后，已被取录 ON-TIME DELIVERY PERFORMANCE 发货守时评分 Comments on issue, impact and supplier explanation / 请解释服务性质量和它们的重要性 On-Time Delivery Criticity 准时重要 性 RFI stage 要求资料阶段 First Name 名字 ALTERNATIVE CONTACT 其他联络人 C MAIN CONTACT 主要联络人 A Title 职位 If yes, please describe alternative and comment impact / 如果“有”，请解释他们的提议和重要 性 Give advice on paper to use in order to save cost Date (mm/yy) 日 期 （月/年） Products # # of days delay 延误 （天） The current suppliers’ performance is assessed on an on-going basis A+ Supplier Scorecard Competitiveness Q1 Q2 Q3 Q4 On-time delivery Quality Proactiveness B+ B+ B+ A A A+ B A B B+ A A B+ B B B+ A B+ B+Performance Overall performance Q1 Q2 Q3 Q4
  • 28.
    © 2018 DragonSourcing. All rights reserved. Introduction of new suppliers into the sourcing pool contributes to driving cost and quality improvements while challenging incumbent suppliers Alternative sourcing opportunities monitoring Current supplier performance management List of qualified suppliers • Supplier name • City, web site, contact • Turnover, #employees • Price structure • Capacities • Audit report • Samples • New supplier 1 • New supplier 2 • New supplier 3 • … • New supplier n • Current supplier 1 • Current supplier 2 • Current supplier 3 • … • Current supplier n Supplier pool structure 0 5 10 15 20 25 30 35 40 45 50 New suppliers (< 1 year) New suppliers (1-2 years) Historic suppliers (> 2 years) > 2 years 1-2 years <1 year
  • 29.
    © 2018 DragonSourcing. All rights reserved. Creative agencies provide initial specifications for each product Item Material Size Process requirement Product Picture Cardboard 4mm board, 157 paper 400*120*125 shape, paperhanging Plastic bed & Flocking PS plastic with flocking Subject to real size shape Printing - 174 gram silver paper - Ink DIC - - Color 5 C - - Surface protection Plastic film Subject to real size Outside Package Triple wall corrugated fiber box 8 units / package Mark: SKU Test Method Strength test
  • 30.
    © 2018 DragonSourcing. All rights reserved. Cross-brand quantitative requirements are consolidated by product categories to leverage negotiation with suppliers Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Fore- c ast Ac tual Var. Product 1 63,548 64,993 10,560 6,744 14,175 13,823 7,484 12,207 Product 2 45,592 48,739 12,997 7,945 7,354 6,092 7,412 6,939 Product 3 46,886 50,750 9,489 7,225 13,598 8,610 5,302 6,525 Product 4 50,736 52,358 9,133 7,388 11,200 12,431 5,965 6,241 Product 5 47,616 47,833 11,542 5,819 5,796 10,704 5,896 8,075 Product 6 44,016 45,626 11,169 5,647 8,981 5,109 6,330 8,390 Product 7 47,030 48,779 10,134 5,305 9,058 9,306 6,291 8,685 Product 8 46,948 48,666 8,373 5,954 7,366 9,890 7,345 9,738 Product 9 51,204 53,550 11,104 7,424 12,723 7,770 5,057 9,471 Product 10 47,674 50,052 12,832 6,699 7,582 9,148 7,593 6,197 Product 11 59,735 64,437 11,648 6,731 14,498 13,442 6,637 11,481 Product 12 40,135 44,001 5,136 7,563 6,148 8,971 6,853 9,330 Product 13 43,453 47,023 10,732 6,967 5,852 8,930 5,839 8,703 Product 14 46,570 48,411 8,827 6,655 11,949 9,258 5,112 6,610 Total 681,142 715,217 143,676 94,067 136,280 133,485 89,116 118,593 Fore- cast Actual produc- tion Brand 2 Var. Brand 6Brand 5Brand 4Brand 3 Unit: pcs Brand 12006 CNY Actual
  • 31.
    © 2018 DragonSourcing. All rights reserved. The RFQ process includes a supplier cost structure breakdown to check consistency and to gain a deep understanding of price drivers Box production TransportationPrinting and effects on the printing C ardboard -纸 板 Flocking -植 绒 Plastic Bed (PS)-吸 塑 O utside Package -外 包 装 Afterprocess & Labor-后 道 &人 工 Paper-纸 张 Ink -油 墨G olden/SilverPrinting -印 金 /印 银 Film C overing -覆 膜 SpotU V Varnishing -过 釉 G olden/SilverStam ping -烫 金 /烫 银 Em bossing /D ebossing -凹 凸 处 理 Price ofextra 4C printing -4色 印 刷 Price ofextra 6C printing -6色 印 刷 Price ofextra 7C printing -7色 印 刷 TO TA L Shanghai-上 海 Beijing -北 京 Xiam en -厦 门 Zhongshan -中 山 W uhan -武 汉 C hengdu -成 都 Supplier 1 4.49 0.32 0.28 1.54 3.87 0.26 0.62 0.04 0.44 4.62 0.28 0.23 0.07 0.55 0.05 17.7 0.21 0.09 0.43 0.67 0.79 2.18 Supplier 2 4.06 0.31 0.26 1.63 3.91 0.24 0.63 0.04 0.48 4.95 0.27 0.24 0.06 0.54 0.04 17.7 0.20 0.08 0.39 0.64 0.81 2.36 Supplier 3 4.54 0.31 0.29 1.44 3.72 0.26 0.66 0.04 0.40 4.56 0.26 0.24 0.07 0.60 0.04 17.4 0.19 0.09 0.44 0.72 0.82 2.14 Supplier 4 4.36 0.34 0.31 1.64 4.17 0.24 0.62 0.04 0.41 4.99 0.28 0.22 0.07 0.58 0.05 18.3 0.20 0.08 0.42 0.68 0.74 2.34 Supplier 5 4.42 0.31 0.26 1.45 4.01 0.24 0.58 0.04 0.43 4.27 0.30 0.25 0.07 0.58 0.05 17.3 0.23 0.08 0.43 0.71 0.79 1.98 Supplier 6 4.57 0.32 0.29 1.58 3.82 0.23 0.64 0.04 0.42 4.29 0.26 0.23 0.07 0.53 0.05 17.4 0.23 0.09 0.40 0.60 0.72 2.02 Supplier 7 4.87 0.33 0.29 1.41 4.00 0.25 0.56 0.05 0.41 4.25 0.26 0.23 0.07 0.54 0.05 17.5 0.21 0.08 0.44 0.65 0.82 2.21
  • 32.
    © 2018 DragonSourcing. All rights reserved. The final supplier selection is based on sample quality and price level Suppliers’ quotation Sample Supplier Name Final Ranking Supplier 1 1 Supplier 2 4 Supplier 3 2 Supplier 4 5 Supplier 5 3 Supplier summary Supplier capabilities Supplier assesment Box production TransportationPrinting and effects on the printing C ardboard -纸 板 Flo ckin g -植 绒 Pla stic Bed (PS)-吸 塑 O utsid e Package -外 包 装 Afterprocess & Labor-后 道 &人 工 Paper-纸 张 Ink -油 墨G old en/SilverPrin tin g -印 金 /印 银 Film C overin g -覆 膜 SpotU V Varnis hin g -过 釉 G old en/SilverStam pin g -烫 金 /烫 银 Em bossin g /D ebossin g -凹 凸 处 理 Pric e ofextra 4C prin tin g -4色 印 刷 Pric e ofextra 6C prin tin g -6色 印 刷 Pric e ofextra 7C prin tin g -7色 印 刷 TO TA L Shanghai-上 海 Beijin g -北 京 Xia m en -厦 门 Zhongshan -中 山 W uhan -武 汉 C hengdu -成 都 Supplier 1 4.49 0.32 0.28 1.54 3.87 0.26 0.62 0.04 0.44 4.62 0.28 0.23 0.07 0.55 0.05 17.7 0.21 0.09 0.43 0.67 0.79 2.18 Supplier 2 4.06 0.31 0.26 1.63 3.91 0.24 0.63 0.04 0.48 4.95 0.27 0.24 0.06 0.54 0.04 17.7 0.20 0.08 0.39 0.64 0.81 2.36 Supplier 3 4.54 0.31 0.29 1.44 3.72 0.26 0.66 0.04 0.40 4.56 0.26 0.24 0.07 0.60 0.04 17.4 0.19 0.09 0.44 0.72 0.82 2.14 Supplier 4 4.36 0.34 0.31 1.64 4.17 0.24 0.62 0.04 0.41 4.99 0.28 0.22 0.07 0.58 0.05 18.3 0.20 0.08 0.42 0.68 0.74 2.34 Supplier 5 4.42 0.31 0.26 1.45 4.01 0.24 0.58 0.04 0.43 4.27 0.30 0.25 0.07 0.58 0.05 17.3 0.23 0.08 0.43 0.71 0.79 1.98 Supplier 6 4.57 0.32 0.29 1.58 3.82 0.23 0.64 0.04 0.42 4.29 0.26 0.23 0.07 0.53 0.05 17.4 0.23 0.09 0.40 0.60 0.72 2.02 Supplier 7 4.87 0.33 0.29 1.41 4.00 0.25 0.56 0.05 0.41 4.25 0.26 0.23 0.07 0.54 0.05 17.5 0.21 0.08 0.44 0.65 0.82 2.21
  • 33.
    © 2018 DragonSourcing. All rights reserved. Very short time to market requires efficient contracting and payment management 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 6-Nov 13-Nov 20-Nov 27-Nov 4-Dec 11-Dec 18-Dec 25-Dec 1-Jan 8-Jan 15-Jan 22-Jan 29-Jan 5-Feb 12-Feb date #contracts signed by supplier signed by customer -17 -12 -18 -29 -29 9-Nov-06 19-Nov-06 29-Nov-06 9-Dec-06 19-Dec-06 29-Dec-06 8-Jan-07 18-Jan-07 28-Jan-07 7-Feb-07 17-Feb-07 1 Theorical date of downpayment Actual date of down payment Down payment tracking Contract signature analysis Order global overview Delivery status 15-Nov-06 22-Nov-06 29-Nov-06 6-Dec-06 13-Dec-06 20-Dec-06 27-Dec-06 3-Jan-07 10-Jan-07 17-Jan-07 24-Jan-07 31-Jan-07 7-Feb-07 Product 14 Product 13 Product 12 Product 11 Product 10 Product 9 Product 8 Product 7 Product 6 Product 5 Product 4 Product 3 Product 2 Product 1 Signature date Start Production 1st batch completed 2nd batch completed 3rd batch completed Batch 1: 25/12 Batch 2: 10/01 Batch 3: 21/01 • Contract preparation in collaboration with Legal • Close interaction with suppliers and customer to have contracts signed rapidly • Monitoring of customer down-payments triggering production start • Follow-up of production progress
  • 34.
    © 2018 DragonSourcing. All rights reserved. Overall methodology & 7-step process Quality is regularly monitored during production and at pre-shipment • Dragon Sourcing teams are trained to follow a 7-step process to execute Quality inspections • Sampling and criteria requirements are detailed in a specific document for customer approval • On-site data are recorded in a specifically designed Excel table • Inspections are documented in a report submitted to customer • Action plans are defined in order to improve product quality Sampling & Criterias Excel recording tool Checkitem # Box # Marking Inner carton Mug Quantity Mug heigth Mug upper diameter Mug lower diameter Wall thickness Mug weigth Material type Quality 1 OK OK 48 104.3 64.9 3.6 326 OK OK 2 OK OK 48 103.4 64.5 4.2 346 OK OK 3 OK OK 48 104 64.6 3.9 344 OK OK 4 OK OK 48 104.6 64.8 3.8 317 OK OK 5 OK OK 48 104.3 57 3.6 308 OK OK 6 OK OK 48 104.8 61 3.8 317 OK OK 7 OK OK 48 103.7 64.5 3.9 328 OK OK 8 OK NO 48 103.8 62 3.9 345 OK OK 9 OK OK 48 103.3 64.1 3.1 322 OK OK 10 OK OK 48 103.2 63.4 3.7 325 OK OK 11 OK OK 48 104.4 64.8 3.9 317 OK OK 12 OK OK 48 102.3 64.2 3.2 316 OK OK 13 OK OK 48 105.4 63 4 316 MO OK 14 OK OK 45 105.6 65 4 322 OK OK 15 OK OK 48 106.3 65.6 4.1 357 OK OK 16 OK OK 48 103.4 65.5 3.9 311 NO OK 17 OK NO 48 104.7 64.1 3.8 300 OK OK 18 OK OK 48 104 60 3.8 342 OK OK
  • 35.
    © 2018 DragonSourcing. All rights reserved. Upon production completion, daily planning ensures smooth nationwide delivery • Tight integration with supply chain teams • Transportation planning • Stock level monitoring • Anticipated dispatching to regions • Priorization of production outputs • Reactivity to market demand changes • Management of quality issues at delivery Delivery follow-up Due date: Brand Delive- ries Objec- tive Ratio achieved Region 1 Region 2 Region 3 Region 4 Region 5 Region 6 Product 1 17,488 18,022 97% 3,323 2,273 2,448 2,798 2,973 3,673 Product 2 22,138 24,500 90% 4,206 2,878 3,099 3,542 3,763 4,649 Product 3 21,797 24,139 90% 4,141 2,834 3,052 3,488 3,706 4,577 Product 4 14,991 17,789 84% 2,848 1,949 2,099 2,399 2,548 3,148 Product 5 13,010 14,180 92% 2,472 1,691 1,821 2,082 2,212 2,732 Product 6 11,867 12,016 99% 2,255 1,543 1,661 1,899 2,017 2,492 Product 7 16,586 17,525 95% 3,151 2,156 2,322 2,654 2,820 3,483 Product 8 20,106 23,287 86% 3,820 2,614 2,815 3,217 3,418 4,222 Product 9 14,011 16,580 85% 2,662 1,821 1,962 2,242 2,382 2,942 Product 10 11,060 13,228 84% 2,101 1,438 1,548 1,770 1,880 2,322 Product 11 12,895 14,288 90% 2,450 1,676 1,805 2,063 2,192 2,708 Product 12 24,923 25,131 99% 4,735 3,240 3,489 3,988 4,237 5,234 Product 13 9,869 10,058 98% 1,875 1,283 1,382 1,579 1,678 2,072 TOTAL 210,742 230,745 91% 40,041 27,397 29,504 33,719 35,826 44,256 March 10th CHINA
  • 36.
    © 2018 DragonSourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
  • 37.
    © 2018 DragonSourcing. All rights reserved. Supply Chain Finance Coordination of relationships between branding and purchasing teams is essential in order to bridge 2 groups with extremely different backgrounds DS Managing Director DS Account Manager Category Buying Engineer Marketing Director Marketing Services Manager Brand Manager Brand Manager Brand Manager Brand Manager Brand Manager Brand Manager Dragon SourcingCustomer Category Buying Engineer Category Buying Engineer Marketing Dedicated project team Legal Other project team Other project team Other project team Prepare contracts Organize delivery Monitor payments Category 1 Technology Productcategories Category 2 Category n … Creativity Brands …
  • 38.
    © 2018 DragonSourcing. All rights reserved. The product design results from a close collaboration between Creative Agencies, Customer, Dragon Sourcing and Suppliers RFQ and Sample request Creative agencies SuppliersDragon Sourcing Product briefing Customer Quotation Sample Sample assessment Sample modification request Updated sample Final design decision Final quotation Quotation analysis and recommendations Supplier selection Consumer research
  • 39.
    © 2018 DragonSourcing. All rights reserved. A Supplier day is organised once a year to strenghten relationships and communicate key messages to the qualified supply base Attendees: • Suppliers management and sales teams • Customer purchasing team • Dragon Sourcing project team Objectives • Present future purchasing trends and “sell” Customer as a strategic account • Gain suppliers’ commitment to Customer’s Corporate Social Responsibility chart • Remind suppliers of the purchasing rules of engagement • Present main contractual evolutions
  • 40.
    © 2018 DragonSourcing. All rights reserved. A collaborative web tool supports a live communication on project status
  • 41.
    © 2018 DragonSourcing. All rights reserved. Project status is updated automatically after each meeting Promo type DS Category Contract number Supplier Item Signed & chopped by supplier Signed by Customer Month CNY07 Printed Item V121 Supplier 1 Letter 4-Jan-07 12-Jan-07 Jan-07 POSM Printed Item V056 Supplier 2 Posters 4-Jan-2007 still not Jan-07 MAF06 Gifts J084 Supplier 5 jar 12-Jan-2007 still not Jan-07 MAF06 Gifts J085 Supplier 3 jar 4-Jan-2007 still not Jan-07 flow material Glass J086 Supplier 1 Wine glass 15-Jan-2007 still not Jan-07 flow material Gifts J087 Supplier 4 Watch 10-Jan-2007 still not Jan-07 MAF06 Gifts J091-1 Supplier 3 Camera 2-Jan-2007 9-Jan-07 Jan-07 MAF06 Gifts J091-2 Supplier 4 key ring 11-Jan-2007 9-Jan-07 Jan-07 Gifts V019 Supplier 2 passort holder 2-Jan-2007 Jan-07 MAF06 Gifts V020 Supplier 5 back pack 22-Jan-2007 no Jan-07 MAF06 Gifts V021 Supplier 3 Camera 23-Jan-2007 still not Jan-07 MAF06 Gifts V022 Supplier 1 Gym bag 17-Jan-2007 no Jan-07 MAF06 Gifts V023 Supplier 4 back pack 26-Jan-2007 still not Jan-07 events Gifts V025 Supplier 3 Gym bag 26-Jan-2007 still not Jan-07 events Gifts V026 Supplier 4 key ring 26-Jan-2007 still not Jan-07 MAF06 Gifts V040 Supplier 2 manicure kit 16-Jan-2007 Jan-07 MAF06 Gifts V064 Supplier 5 passort holder 15-Jan-2007 Jan-07 Gifts W095 Supplier 3 plastic pen 23-Jan-2007 19-Jan-07 Jan-07 Gifts W096 Supplier 1 Gym bag 12-Jan-2007 still not Jan-07 Gifts W097 Supplier 4 Travel bag 8-Jan-2007 still not Jan-07 Gifts W098 Supplier 3 back pack 16-Jan-2007 still not Jan-07 Gifts W099 Supplier 4 Ice bucket 16-Jan-2007 no Jan-07 Gifts W100 Supplier 2 key ring 15-Jan-2007 18-Jan-07 Jan-07 Gifts W101 Supplier 5 manicure kit 29-Jan-2007 24-Jan Jan-07 Gifts W102 Supplier 3 passort holder 15-Jan-2007 still not Jan-07 Gifts W103 Supplier 1 plastic pen 23-Jan-2007 still not Jan-07 Gifts W104 Supplier 4 tent card 5-Feb-2007 still not Feb-07 Gifts W105 Supplier 3 plastic pen 5-Feb-2007 17-Jan-07 Feb-07 MAF06 Gifts J088-1 Supplier 4 passort holder 12-Feb-2007 no Feb-07 flow material Gifts J088-2 Supplier 2 Gift box additional order 2-Feb-2007 Feb-07 flow material Gifts J088-3 Supplier 2 standee 6-Mar-2007 Mar-07 Supply Contracts managed by Dragon Sourcing - Starting May 2005
  • 42.
    © 2018 DragonSourcing. All rights reserved. Agenda A. Context and Products B. Sourcing Strategy C. Governance model D. Results & Conclusions
  • 43.
    © 2018 DragonSourcing. All rights reserved. Budget and current spend evolution 0 10 20 30 40 50 60 70 80 90 2004 2005 2006 Budget Actual spend Despite double-digit budget increases and increases in product quality requirements, the actual spend has been maintained below the initial budget Double-digit budget increase Double-digit budget increase-25% -20% Outsourcing to Dragon Sourcing
  • 44.
    © 2018 DragonSourcing. All rights reserved. These results have been achieved by having to sometimes fundamentally change the client’s sourcing strategy, e.g.: Glass products where 40% savings have been achieved Strategy element Current Client strategy Recommendation for the future Rationale Creative agency vs. manufacturer • Creative agency • Direct to Manufacturer • Agency not competent in procurement but in creation • No incentive to optimized total ownership costs • Very high commission fees (over 20%) • Negative taxes impact • Direct link with Manufacturer provides better cost / quality optimization at design stage Technology segmentation • Per Brand • Per technology (Glass, steel wood, leather, etc.) • Consolidated volume to a reduced supplier base Contracting • PO Driven • Annual, frame contracting • Simplify ordering process • Agree key contractual issues (payment terms, tools ownership, etc) • Provide suppliers with better visibility into client requirements • Intellectual property
  • 45.
    © 2018 DragonSourcing. All rights reserved. In addition to these significant savings, other soft benefits have been achieved after nearly two years of collaboration • Total transparency over sourcing process and supplier base • Greatly reduced supply chain risks such as CSR or product availability • Improved Quality of the spec and to the spec • Reduced time to market • Internal Marketing team totally focused on higher value added activities • Customer plans to enlarge scope of work in the future and to extend these benefits to: – Other categories such as logistics or indirect purchases – Other supply markets such as South-East Asia, e.g. Vietnam – Other company subsidiairies to leverage the Chinese supplier base globally
  • 46.
    © 2018 DragonSourcing. All rights reserved. Agenda 1. Our offerings and approach 2. Our clients and category expertise 3. Client case study 4. Successful Sourcing in China 5. Other credentials
  • 47.
    © 2018 DragonSourcing. All rights reserved. Successful Sourcing in China • Adopt strategic approach vs. tactical approach – No leverage back mentality – Follow through with real orders vs. benchmarking only • Sell your « buy » to the Chinese suppliers – High quality suppliers are in high demand – Build credibility in your sourcing program with the suppliers • Enterprise wide approach with top management support vs. Procurement only – Internal change management is often the toughest challenge – Involve Marketing, Quality, Engineering, Manufacturing from the beginning (mix function of categories) • Dedicated professionals vs. User/buyer model – Don’t try using local buyers to manage « export » business • Start with high potential/low risk categories on a pilot basis to generate rapid success – Rigorous analysis of spend portfolio to identify best candidates • In Sourcing cycle per se, use same professional process rigor as in the West – Don’t believe that it’s only a « relationship » game
  • 48.
    © 2018 DragonSourcing. All rights reserved. The following cost framework helps explain, differences in procurement philosophies between Japan and the West Cost Driver Framework Structural Inherent Realized • Cost driven by the selection of the supply base e.g.: – Factor cost – Scale effect • Costs driven by design decisions and by the selection of the manufacturing process • Costs driven by the on- going operational performance of the supplier Castings Example Average cost/kilo by country Mould yield ratio Operational metrics 42,5 44,5 46,5 48,5 50,5 52,5 54,5 56,5 58,5 60,5 C zech R epublic Poland H ungary C anada France U nited Kingdom Sw eden Finland U nited States N etherlands Italy Belgium D enm ark Australia JapanSw itzerlandG erm any Averagecostperkg(measure/kg) The Client average cost 17% 15% 14% 6% 6% 2% 2% 1% 1% 1% 0% 0% 1% 2% 2% 8% 10% 55 Change of: • Labor cost • Energy cost • Transportation cost • Interest rates 0 0,5 1 1,5 2 2,5 3 3,5 4 4,5 0 1000 2000 3000 4000 5000 6000 7000 The weight of the article (grams) Themouldyieldratio Supp. C, Engine Bracket Supp. C, Engine Bracket Supp. A, Camshaft housing Supp. B, Oilsump Averagecostperkg(measure/kg) The Client average cost 42,5 44,5 46,5 48,5 50,5 52,5 54,5 56,5 Improved casting labor productivity Full utilization Reduced burnoff Reduced scrap rate Reduced mould yield ratio 8,9% 9,3% 10,1% 10,6% 12,8% 55 Averagecostperkg(measure/kg) The Client average cost 42,5 44,5 46,5 48,5 50,5 52,5 54,5 56,5 Improved casting labor productivity Full utilization Reduced burnoff Reduced scrap rate Reduced mould yield ratio 8,9% 9,3% 10,1% 10,6% 12,8% 55
  • 49.
    © 2018 DragonSourcing. All rights reserved. Potential China Model Western Japan Competitive pricing Relationshipmanagement Japanese Model (Keiretsu) Western Model Sourcing Model Matrix China’s ambition in procurement can be and must be to leapfrog the West and Japan