Here is a case study by Dragon Sourcing on Door Hardware Sourcing from the Consumer Goods sector for the year 2018 covering China and India. For details contact: www.dragonsourcing.com

1. Door Hardware Sourcing Case Study
Dragon Sourcing - 龙 源
Delivering sustainable sourcing value from emerging markets

2. 2
Agenda
1. Objectives, Approach & Schedule
2. Demand Analysis
3. Results

3. Objectives and Approach
Context
Sourcing Project Objectives
• Identify and prequalify suppliers for the following
Hardware categories:
• Patch fittings
• Mortise Locks
• Profile Cylinders
• Handles
• Hinges
• Panic Hardware
• Accessories
Geographical scope:
• China
• India
Deliverables:
• RFI/RFQ analysis report
• Supplier profiles
• Audit reports
• Suppliers audit profiles
3
DS Strategic Sourcing Approach
Demand Analysis:
Work with client to define and understand the products and
requirements (specs, volumes, materials etc.).
Supply Analysis:
Identify longlist of potential suppliers both in China and India for pre-
screen process by leveraging the web, external databases and various
networks of experts.
Telephone Pre-screening
Selection of suppliers to be included in the RFI/RFP process by
telephone pre-screening based on agreed simple criteria (e.g.
capability to make the product, minimum company size, interest in
participating)
Administer the NDA
Administration and chasing for completion of the NDA with suppliers
that have been preselected
Develop RFI/RFQ
Develop the RFI/RFQ – jointly with client – to include all key supplier
qualification criteria (e.g.: financial, technology, manufacturing etc.) and
quotation requirements.
Administer the RFI/RFQ
Ensure as high return rate as possible including quotation.
Analyze responses
Use balance score card developed together with client management
team to rank
Recommend suppliers which client needs to take through a formal
qualification process factory audit.

4. Approach & Schedule (1/3)
4
Project Activity Jan-16 Feb-16 Mar-16 Apr-16
Week No. W1 W2 W3 W4 W5 W6 W7 W8 W9 W10 W11 W12 W13
18-Jan 25-Jan 1-Feb 8-Feb 15-Feb 22-Feb 29-Feb 7-Mar 14-Mar 21-Mar 28-Mar 4-Apr 11-Apr
1. Demand Analysis
2. Supply Analysis
3. Telephone Pre-screening
4. Develop RFI/RFQ
5. Conduct NDA Administration
6. Conduct RFI/RFQ Administration and
Develop Scorecard
7. Analyze RFI /RFQ
Responses
8. Recommend supplier for Audit
ChineseNewYear
1
RFI/RFQ
Approved
RFI/RFQ Analysis
Report Finished 2

5. Approach & Schedule (2/3)
Stage 1: Supplier Identification
No. Step Deliverables
1.
Demand Analysis
Work with client to define and understand the categories and requirements (specs, volumes, materials,
standards, production technology requirements).
 Project Requirement
Questionnaire
 Kick-Off Report
2.
Supply Analysis
Identify longlist of potential suppliers in selected Asian markets(China and India) by leveraging B2B
Websites, DS Database, Fair catalogues, Magazines, Network, References.
 Supplier Long List
3.
Telephone Pre-screening - Selection of suppliers to be included in the RFI/RFP process by telephone
pre-screening based on agreed simple
 Shortlist for RFI/RFQ
Administration
4.
Develop RFI/RFQ
Prepare an RFI/RFQ document, with an aligned Balanced Scorecard that has the objective to pre-
qualify the competitiveness and capabilities of the suppliers, including: Background, financial, Client
and product experience, Quality certification & processes, Social Responsibility, Etc.,
 RFI/RFQ Template
 Balanced Scorecard
Milestone 1: RFI/RFQ Approved by client
NDA Administration
Send NDA document to suppliers who are approved by client for RFI/RFQ process. To sign the NDA
and send original back to DS on time. So that we can go to the step of RFI/RFQ administration
 NDA signed by
suppliers
5.
Conduct RFI/RFQ Administration
The RFI/RFQ is translated to the local languages as relevant, and distributed to the relevant suppliers,
with telephone follow-up to push for maximum participation.
 Completed RFI/RFQs
6.
Analyze RFI/RFQ Responses
Analysis of RFI/RFQ responses, estimation of logistics costs, and preparation of a report, which
profiles & objectively ranks the suppliers by capability and competitiveness, including a
recommendation for those to be audited.
 RFI/RFQ Analysis
Report
 Supplier Profiles
 Proposed Shortlist for
Audit and/or sample
5

6. Approach & Schedule (3/3)
6
No. Step Deliverables
7.
Develop overview of GEZE product packages
- which suppliers can supply which SKUs
- which product package pricing can be achieved
- including packaging of product packages
- including logistics cost
 Project Requirement
Questionnaire
 Kick-Off Report
Milestone 2: Shortlist for Audit Agreed
8.
Prepare for Audits:
Planning the audit schedule, travel budget, and drafting the audit questionnaire that will be used for the
manufacturer’s self-assessment and on-site audits.
 Audit Plan
 Audit Questionnaire
9.
Conduct audits jointly with GEZE:
Distribution of the audit questionnaire to manufacturers for their self-assessment followed by onsite
audits of all the manufacturers. Focus is management, logistics, production, quality and includes photos
& videos where allowed.
 Completed Audit
 Questionnaires
10.
Analyze Audit Results:
Analysis of the audit results together with RFI/RFQ results and preparation of a report that ranks the
manufacturers, including a recommendation for those for sample development
 Audit Report
 Supplier Audit Profiles
 Proposed Shortlist for
Sampling
Milestone 3: Shortlist for Sampling Agreed
11.
Sample Development & Testing:
Managing the sample development and testing iterations to determine which manufacturers can meet
the quality.
 Samples
12.
Negotiation & Contracting:
Conducting final negotiations with the shortlisted Manufacturers
 Contract
Milestone 4: Contracts Secured
Phase 2: Selection & Contracting

7. 7
Agenda
1. Objectives, Approach & Schedule
2. Demand Analysis
3. Results

8. Demand Analysis
Category – Door Hardware
total 7 product sub-categories, 116 SKUs, USD 2.7M yearly spend
8
Other Requirements:
• Packaging, Fire Rate, Fixing Fasteners, Logo etc.. must meet client requirement
• Partial SKU Missing sales quantity and target price
Product No of SKU
Sales quantity total Yearly Spend
Product Pictures
(Pieces) (USD)
Patch fittings 19 127,300 990,851
Mortise Locks 9 50,450 262,925
Profil Cylinders 13 37,350 151,388
Handles 14 51,150 197202
Hinges 6 123,000 436,959
Panic Hardware 17 9,700 358,066
Accessories 38 49,650 318,677
Total: 116 448,600 2,716,103

9. 9
Agenda
1. Objectives, Approach & Schedule
2. Demand Analysis
3. Results

10. From an initial list of 295 suppliers, we have shortlisted 11 for auditing
3 out of these 12 come from client’s original supplier list
10
220
162
56
42
23
10
75
57
14
11
6
1
0
50
100
150
200
250
300
350
Suppliers Identified Supplier include in
Phone interview
Passed Phone
Interview
NDA received RFI/RFQ received Supplier Shortlisted
Door Hardware Sourcing project progress review
India China
11
70
219
295
29
53

11. In total, 219 suppliers have been identified and called.
70 suppliers have passed the phone screening and have been included in NDA
process.
11
Phone Screening rejected reason Total % China India
Not certified under ISO 9001 50 34% 39 11
They don't manufacture door hardwares 23 15% 16 7
Trader 23 15% 11 12
No export experience to USA &EU 22 15% 15 7
They cannot export 17 11% 14 3
Not interested in this project 7 5% 6 1
Not responding to any of the contact number 7 5% 5 2
Total Rejected 149 62% 106 43
162
57
56
14
0
40
80
120
160
200
China India
Phone Screening Review
Supplier include in
Phone interview
Passed Phone Interview
34%
15%15%
15%
11%
5%
5%
Phone Screening Rejected Reason

12. 53 out of 70 suppliers signed NDA, 17 failed
12
56
14
42
11
0
20
40
60
80
China India
NDA progress Review
Passed Phone
Interview
NDA received
35%
30%
35%
NDA Rejection Reason
NDA Rejection Reason Total % China India
Not interested 6 35% 6
Not agree NDA term 5 29% 5
Too busy to sign NDA 6 35% 3 3
Total Rejected 17 100% 14 3

13. 53 suppliers have been included in the RFI/RFQ process
29 RFI/RFQs received
13
32%
20%16%
12%
12%
8%
RFI-RFQ rejection Reason
42
11
23
6
0
15
30
45
60
China India
RFI-RFQ progress Review
NDA received
RFI/RFQ received
Rejection Reason: All Steps Total % China India
They cannot meet client specification 8 32% 8
They cannot produce as per the client specification 5 20% 3 2
Not interested in RFIRFQ 4 16% 3 1
Material not match 3 12% 3
Can’t meet Fireproof rate 3 12% 3
Not responding to any of the contact details 1 8% 1
Total Rejected 24 100% 20 4

14. Suppliers location – China
24 Chinese suppliers responded to the RFI-RFQ
22 RFI/RFQs received, 1 RFQ only, 1 RFI only received (1/2)
Xinjiang
Gansu
Jiangx
i
Zhejiang
BEIJING
Jiangsu
Guangxi
Hunan
Hubei
Qinghai
Ningxia
Shanxi
Anhui
Fujian
Neimongu
Shanxi Shandong
Xizang
Sichuan
Yunan
Guizhou
Henan
Jilin
Liaoning
Hebe
i
Guangdong
Gansu
SHANGHAI
Hong Kong
Taiwan
Heilongjiang
Tianjin
Sichuan
Client in Tianjin
Supplier # Province RFI RFQ
1 Hebei Y Y
2 Guangdong Y Y
3 Guangdong Y Y
4 Zhejiang Y Y
5 Guangdong Y Y
6 Guangdong Y Y
7 Guangdong Y Y
8 Guangdong Y Y
9 Jiangsu Y Y
10 Guangdong Y Y
11 Guangdong Y Y
12 Zhejiang N Y
13 Beijing Y N
14 Guangdong Y Y
15 Beijing Y Y
16 Jiangsu Y Y
17 Guangdong Y Y
18 Shanghai Y Y
19 Guangdong Y Y
20 Guangdong Y Y
21 Guangdong Y Y
22 Shanghai N Y
23 Guangdong Y Y
24 Guangdong Y Y
14

15. 15
Suppliers location – India
6 Indian suppliers responded to the RFI/RFQ
3 in Gujarat, 2 in Uttar Pradesh, 1 in Punjab (2/2)
Supplier # Province RFI RFQ
1 Punjab Y Y
2 Gujarat Y Y
3 Uttar Pradesh Y Y
4 Gujarat Y Y
5 Uttar Pradesh Y Y
6 Gujarat Y Y

16. 16
29 suppliers quoted, supplier 1 quoted 74 out of 116 SKUs,
None of the suppliers quoted all SKUs
Product
#SK
U
Number of quotes per supplier
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
Patch fittings 19 11 16 4 9 15 10 19 18
Mortise Locks 9 5 9 4 4 6 9 8 5 9 6 9
Profil Cylinders 13 13 13 13 10 13 13 6 10 13 8 13 10 13 13 8
Handles 14 12 10 11 11 13 14 10 5 7 8 9 4 6 3 6 3
Hinges 6 4 4 4 4 2 2 2 3
Panic Hardware 17 1 1 1 1 1 1 1 1
Accessories 38 29 8 21 17 12 16 11 13 16 15 4 11 16 9 13 8 6 3 2
Total SKU 116 74 56 53 47 45 40 39 36 28 26 26 24 24 23 22 30 19 18 16 15 14 13 13 11 9 8 6 3 2
EN Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes
ANSI Yes Yes
UL Yes Yes Yes
CCC Yes Yes Yes Yes
Suppliers from client’s original list of 15

17. 17
Patch fittings, total spend $0.99M
7 suppliers have a total spend lower than client target
Current
spend
Suppliers without
saving
Suppliers with
saving
990851
604236 606560 621013
723840
788889
816177
923361
1006374
0
200000
400000
600000
800000
1000000
1200000
Patch fittings Total spend comparison
If supplier didn’t quote SKU, we used client’s current target price to calculate

18. 18
Patch fittings, total 19 SKUs,
savings potential ranges from 7% - 39% ($67K - $386K)
Suppliers from client’s original list of 15.If supplier didn’t quoted SKU, we used GEZE current target price to calculate
Patch fittings
total Spend
USD
No .of SKU
Quoted
Total Spend USD
Cost
Saving
Cost Saving %
Recommend
Delivery sample
To client990,851
Supplier 1 16 604,236 386,615 39% Yes
Supplier 2 18 606,560 384,291 39% Yes
Supplier 3 10 621,013 369,838 37% Yes
Supplier 4 11 723,840 267,011 27% Yes
Supplier 5 19 788,889 201,962 20% Yes
Supplier 6 9 816,177 174,674 18% Yes
Supplier 7 4 923,361 67,490 7% Yes
Supplier 8 15 1,006,374 -15,523

19. 19
Mortise Locks, total spend $0.26M, 8 out of 11 suppliers total spend lower
than client target
263
121
202
225 227
238 242
250 252
273
300
319
0
50
100
150
200
250
300
350
KUSD
Mortise LocksTotal spend comparison
Current
spend
Suppliers without
saving
Suppliers with
saving
If supplier didn’t quoted SKU, we used client current target price to calculate

20. 20
Mortise Locks,
Potential cost savings range from 4%-54% ($11K-$142K)
Mortise
Locks
Total Spend USD
No .of SKU
Quoted
Total Spend
USD Cost
Saving
USD
Cost
Saving %
Recommend Submit
sample To client
Remark
262,925
Supplier 1 9 121,080 141,845 54% Yes Have EN certificate
Supplier 2 6 201,634 61,291 23%
Didn’t fill RFI, Not sure supplier if
qualified
Supplier 3 8 225,405 37,520 14% Yes Have EN certificate
Supplier 4 6 226,955 35,970 14% Yes
Supplier 5 5 237,525 25,400 9% Yes Have EN certificate
Supplier 6 9 242,477 20,449 8% Yes
Supplier 7 9 249,900 13,025 5% Yes Have EN certificate
Supplier 8 5 251,580 11,345 4% Yes
Supplier 9 9 273,270 -10,345 Yes
Supplier 10 4 299,789 -36,864 Yes Have EN certificate
Supplier 11 4 319,329 -56,404
Suppliers from client’s original list of 15If supplier didn’t quoted SKU, we used client current target price to calculate

21. 21
Profil Cylinders, total spend $151K,
12 out of 15 suppliers have a total spend lower than GEZE target
Current
spend
Suppliers without
saving
Suppliers with
saving
If supplier didn’t quoted SKU, we used client current target price to calculate
151
75
92
106 107
125 127 131 134 137 137 140 144
156
185
193
0
50
100
150
200
250
KUSD
Profil CylindersTotal spend comparison

22. 22
Profil Cylinders, total 13 SKUs,
potential cost savings range from 5 - 51% ($7K-$76K)
Profil
Cylinders
total Spend USD
No .of SKU
Quoted
GEZE Total
Spend USD
Cost Saving
USD
Cost Saving
%
Recommend Submit
sample To client
Remark
151,388
Supplier 1 13 74,821 76,567 51% Yes
Supplier 2 13 91,882 59,507 39% Yes Have EN certificate
Supplier 3 13 106,353 45,035 30% Yes
Supplier 4 10 106,594 44,794 30%
Didn’t fill RFI, Not sure
supplier if qualified
Supplier 5 6 125,390 25,998 17% Yes Have EN certificate
Supplier 6 13 127,025 24,363 16% Yes Have EN certificate
Supplier 7 13 131,230 20,158 13%
Supplier 8 10 134,085 17,304 11% Yes Have EN certificate
Supplier 9 13 137,108 14,281 9% Yes
Supplier 10 13 137,225 14,163 9%
Supplier 11 8 140,196 11,192 7%
Supplier 12 8 143,849 7,539 5% Yes Have EN certificate
Supplier 13 10 156,276 -4,887
Supplier 14 13 185,045 -33,657
Supplier 15 13 192,840 -41,452
If supplier didn’t quoted SKU, we used client current target price to calculate
Suppliers from client’s original list of 15

23. 23
Handles, total spend $191K,
4 out of 14 suppliers have total spend lower than client target
197
165
190 192 196 197 199
205 206
215
224 226 227 230 232
253
292
0
50
100
150
200
250
300
350
KSUD
Handles total spend comparison
If supplier didn’t quoted SKU, we used client current target price to calculate

24. 24
Handles, total 14 SKUs,
potential cost savings range from 3% - 16% ($5K-$32K)
Handles
Total Spend USD
No .of SKU
Quoted
Total Spend
USD Cost Saving
USD Cost Saving %
Recommend
Submit sample
To client
Remark
197,202
Supplier 1 13 164,675 32,527 16% Yes
Supplier 2 10 190,328 6,875 3% Yes
Supplier 3 14 191,925 5,277 3% Yes
Supplier 4 8 197,405 -203 Yes Have EN certificate
Supplier 5 6 198,600 -1,398 Yes Have EN certificate
Supplier 6 12 205,165 -7,963 Yes
Supplier 7 11 205,570 -8,368
Supplier 8 5 214,808 -17,606 Have EN certificate
Supplier 9 6 223,585 -26,382
Supplier 10 10 225,560 -28,357 Yes Have EN certificate
Supplier 11 3 226,745 -29,543
Supplier 12 11 229,774 -32,571
Supplier 13 9 232,027 -34,824 Have EN certificate
Supplier 14 7 253,374 -56,171
Supplier 15 3 291,970 -94,768
If supplier didn’t quoted SKU, we used client current target price to calculate
Suppliers from client’s original list of 15

25. 25
Hinges, 1 out of 8 suppliers has a total spend lower than client target
437
338
451
478 479 492 498
554
578
0
100
200
300
400
500
600
700
KUSD
Hinges Total spend comparison
If supplier didn’t quote SKU, we used client current target price to calculate

26. 26
Hinges, total 6 SKUs, 1 supplier has potential cost savings of 23% ($99K)
Hinges
Total Spend USD
No .of SKU
Quoted
Total Spend
USD Cost Saving
USD
Cost Saving
%
Recommend
Submit sample To
client
Remark
436,994
Supplier 1 4 337,814 99,180 23% Yes
Supplier 2 3 450,944 -13,950 Yes Yes
Supplier 3 4 477,634 -40,640 Yes Yes
Supplier 4 2 479,044 -42,050
Supplier 5 2 492,184 -55,190 Have EN certificate
Supplier 6 4 497,884 -60,890
Supplier 7 2 554,444 -117,450
Supplier 8 4 577,886 -140,892
If supplier didn’t quote SKU, we used client current target price to calculate
Suppliers from client’s original list of 15

27. 27
Accessories,
11 out of 19 suppliers have a total spend lower than client target.
319
302 306 309 312 312 314 314 317 318 318 318 319 321 322 323 324 324 326
333
0
100
200
300
400
KSUD
Accessories Total spend comparison
If supplier didn’t quote SKU, we used GEZE current target price to calculate

28. 28
Accessories,
total 29 SKUs, potential cost savings range from 0.3% - 5% ($0.8K-$16K)
Accessori
es
Total Spend USD
No .of SKU
Quoted
Total Spend USD Cost Saving
USD
Cost Saving %
Recommend
Submit sample
To client
Remark
318,677
Supplier 1 8 302,455 16,222 5% Yes
Supplier 2 11 306,009 12,668 4% Yes
Supplier 3 13 308,535 10,142 3% Yes
Supplier 4 13 311,915 6,762 2%
Supplier 5 4 311,940 6,737 2%
Supplier 6 16 313,644 5,033 2% Yes
Supplier 7 16 313,892 4,785 2% Yes
Supplier 8 21 316,538 2,139 1% Yes
Supplier 9 12 317,630 1,048 0.3%
Supplier 10 9 317,775 902 0.3%
Supplier 11 3 317,860 818 0.3%
Supplier 12 16 319,103 -426
Supplier 13 17 320,995 -2,318
Supplier 14 2 321,837 -3,160
Supplier 15 8 322,994 -4,317
Supplier 16 6 323,917 -5,240
Supplier 17 15 324,302 -5,625 Yes Have ALL certificate
Supplier 18 29 326,437 -7,759
Supplier 19 11 332,970 -14,293
Suppliers from client’s original list of 15
If supplier didn’t quote SKU, we used client current target price to calculate

29. 29
Total cost savings analysis
35% savings are achievable if the total spend is sourced
from the most attractive supplier
Suppliers from client’s original list of 15.
If supplier didn’t quote SKU, we used GEZE current target price to calculate
Product
Per sub-categories supplier savings
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27
Patch
fittings
267,011 386,615 67,490 174,674 0 369,838 201,962 384,291
Mortise
Locks
11,345 20,449 0 0 35,970 0 37,520 25,400 13,025 61,291 141,845
Profil
Cylinders
14,281 45,035 59,507 0 14,163 0 25,998 17,304 0 7,539 24,363 44,794 369,838 76,567 11,192
Handles 0 6,875 0 0 32,527 5,277 0 0 0 0 0 0 6 0
Hinges 0 0 0 99,180 0 0 0 0
Panic
Hardware
0 0 0 0 0 0 0 0
Accessories 0 16,222 2,139 0 1,048 5,033 0 10,142 4,785 0 6,737 12,668 902 6,762 0 0 818
Total
Savings
292,637 475,195 61,646 0 83,708
104,45
7
98,521 191,978 28 379,980 4,785 45,059 49,763 0 208,699 25,683 384,291 106,085 902 6,762 369,838 76,567 11,192 141,845 8 6 818
EN Yes Yes Yes Yes Yes Yes Yes Yes Yes
ANSI Yes Yes
UL Yes Yes Yes
CCC Yes Yes Yes
The biggest savings for per sub-category

30. 30
Suppliers with savings
Total cost savings analysis
Cost savings range from 0.2% - 35%
the highest potential coming from the 1st supplier who quoted 56 out of 116 SKUs
-
100
200
300
400
500
KUSD
Supplier Total savings comparison
If supplier didn’t quote SKU, we used client current target price to calculate

31. Recommendations
We recommend to audit the 11 shortlisted suppliers below
10 in China, 1 in India
31
Suppliers from the original client list of 15
Supplier
Recommend Audit Country of
Origin
RFI Score
PerSKU
savings (USD)
Total
sacings
Sub-categories
Remark
subcategory Saving %
1 Profil Cylinders China 81 25,998 25,998 17% Have EN certificate
2
Mortise Locks
China 77
11,345
70,852
4%
Have EN certificate
Profil Cylinders 59,507 39%
3 Patch fittings China 75 201,962 201,962 20%
Bigger cist savubf ub Oatch
futtings
4
Mortise Locks
China 73
37,520
45,059
14%
Have EN certificate
Profil Cylinders 7,539 5%
5
Patch fittings
China 71
92,592
249,485
29%
The Biggest cost saving in
Patch fittings and accessories
Mortise Locks 54,033 17%
Handles 6,875 3%
Accessories 95,985 30%
6
Patch fittings
India 69
174,674
191,978
18%
Have EN certificate
Profil Cylinders 17,304 11%
7
Hinges
China 66
0
12,668
0
Have EN certificate
Accessories 12,668 4%
8
Patch fittings
China 66
267,011
267,011
27% Quoted the most SKU ,Panic
hardware Have similar
product but not quotedPanic Hardware
9
Handles China
65
5,277
104,457
3% Quoted all SKU
Hinges 99,180 23%
The Biggest cost saving in
Hinges
10 Patch fittings China 61 384,291 384,291 39%
Bigger cost saving in patch
fittings
11 Profil Cylinders China 59 76,567 76,567 51%
The Biggest cost saving in
Profil Cylinders

32. Recommendations
32
We recommend that client / DS jointly audit 11 shortlisted suppliers (10 in China, 1 in India), the next steps
Include：
 Collection of samples, to test in Germany
 On site audit to verify their production capability, quality and management
 Critical sample development and test, make sure supplier can meet client’s requirements
 Collect full spend data to prepare negotiations with current and new suppliers as soon as audits and
tests are finished
 Place trial production orders to verify suppliers’ capabilities regarding production quantities and if
satisfactory, sign contract