Sourcing services can be more effective to start a new company in China. It helps in all the aspects to start a new company. Here you will learn different facts how does sourcing services to start a new company in China? To know more visit: http://www.dragonsourcing.com/china-sourcing-company/

1. Dragon Sourcing case study
Supporting New Factory launch
Shanghai, Aug 2015
Dragon Sourcing - 龙 源
Your Tailored Sourcing Approach to LCC Sourcing

2. 22
Introduction
 client – one of the biggest chocolate producer in the world with +10 billion EUR in revenues
 Project Objectives
Dragon Sourcing was selected to carry sourcing services to support the launch of a new factory in China by
selecting world class competitive suppliers in China to cover all needs of the new factory
© 2015 Dragon Sourcing. All rights reserved.

3. 33
The programme was managed in 3 stages
All other Purchasing requirements
• Equipments/instruments
• MRO
• Service
• Others
Capex Sourcing
• Pipelines
• Utilities
• Automation
• Tanks and silos
• Part of production line
• Packaging machine
• IT
Pilot projects
• Engineering service
• Construction service
May 2014 – now
August 2013
July 2013
© 2015 Dragon Sourcing. All rights reserved.

4. Agenda
© 2015 Dragon Sourcing. All rights reserved. 4
1. Introduction
2. Projects – July 2013 to May 2014
3. Projects – May 2014 to Sept 2015

5. © 2015 Dragon Sourcing. All rights reserved.
Context
Objectives:
• Focused on below capex 9 categories to build a new plant in China,
 Pipelines
 Tanks and Silos
 Utilities
 Part of a Production Line
 Packaging Machine
Engineering service
Construction service
Automation/Installation
IT
Geographical scope:
• China
Deliverables:
• RFI / RFQ and Score Card
• Supplier profiles
• Audit reports
5
Gansu
Jiangxi
Zhejiang
BEIJING
Jiangsu
Guangxi
Hunan
Hubei
Qinghai
Ningxia
Shaanxi
Anhui
Fujian
Neimongu
Shanxi
Shandong
Sichuan
Yunan
Guizhou
Henan
Jilin
Liaoning
Hebei
Guangdong
Gansu
SHANGHAI
TAIWAN
Heilongjiang
Location of identified suppliersLocation of client’s plant

6. © 2015 Dragon Sourcing. All rights reserved. 6
Process for New Plant Building
9 important categories in the process for the new plant building
DS Scouting Out of DS scope
New plant
Location
selection
6.Engineering
Service
(design)
Trial production
Formal
production
Commission
Feasibility
report
Construction
Management
Procurement
7.Construction
service
3. Utilities
Process area
Production area
Packaging area
Electrical parts
8. Automation
Mechanical parts
5.Packaging machine
1. Pipelines
2. Tanks and Silos
4. Part of production line
Others
9. IT

7. • 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
Dragon Sourcing Approach
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
© 2015 Dragon Sourcing. All rights reserved.

8. © 2015 Dragon Sourcing. All rights reserved. 8
• Steering Committees weekly (conference
call) to review overall progress on all
categories
• Categories follow-up meetings on an ad-
hoc basis to review category issues
• Meeting minutes record main decisions,
planned actions and project status
Dragon SourcingClient
DS CEO
DS Account Manager
CPO
Strategic Sourcing
Manager
Buyer
Buyer
Buyer
Buyer
Buying Engineer
Buying Engineer
Buying Analyst
The 9 categories sourcing is managed via a series of frequent conference
call meetings
Buying Analyst
Buying Analyst
Buyer

9. 9 categories-5 categories for equipments
-1. Pipelines, 2. Tanks&Silos
© 2014 Dragon Sourcing. All rights reserved. 9
1. Pipelines 2. Tanks and Silos

10. 9 categories-5 categories for equipments
-3. Utilities-electrical parts and mechanical parts
© 2014 Dragon Sourcing. All rights reserved. 10
Electrical parts-Switchgear
&Switchboard
Electrical parts-Transformer Electrical parts-UPS Electrical parts- Diesel Generator
Mechanical parts-AHU Mechanical parts-Chiller Mechanical parts-Cooling Tower Mechanical parts-Air compressor

11. 9 categories-5 categories for equipments
-4. Part of production line-equipments
© 2014 Dragon Sourcing. All rights reserved. 11
Equipments-Mixer Equipments-Refining System Equipments-Tempering Machine Equipments-Roaster
Equipments-Air Humidifier Equipments-Mills Equipments-Chocolate Pump Equipments-Pumps and Valves

12. 9 categories-5 categories for equipments
-4. Part of production line-lines
© 2014 Dragon Sourcing. All rights reserved. 12
Lines-Moulding line Lines-easy line

13. 9 categories-5 categories for equipments
-5. Packaging Machine
© 2014 Dragon Sourcing. All rights reserved. 13
Flow pack Wrappers
Thermoforming
Machine
Tray Formers Cartoner/Case Packing Shrinker machine
Robot & Tool Checkweigher Ink Jet Laser Marker Hot Transfer

14. 9 categories - 4 services categories
-6. Engineering service, 7. Construction service, 8. Automation, 9. IT
© 2014 Dragon Sourcing. All rights reserved. 14
6. Engineering service 7. Construction service 8. Automation 9. IT
-Working scope for engineering
company
Detailed engineering services
Detailed design
Permitting service
Engineering timing & Permitting
schedule
Manhours and fee for
engineering
If good enough the engineering
company can also be the
management company
Close to client‘s factory
Recommend for piling supplier
Good English skill
-Working scope for construction
company
Construction services
Permitting service
Support for tender for construction
company and supervision for
realisation phase
Constructoin timing & Permitting
schedule
Manhours and fee for construction
List the work for sub-contract
Enough license
Close to client‘s factory and can do
construction work in Xiaoshan,
Hangzhou city (with license)
Good English skill
-Working scope for construction
company
No matter integrator or producer,
supplier must have the capability to
program software and integrate hardware
for different brands, and also cabling
work
Automatioin including 4 areas: utilities
automation, process automation,
production automatoin and packaging
automation
Supplier has the design capablity fo the
packaigng parts
Good english skill
Hardware will be used as below:
• Automation control system (PLC)
• Operator control and monitoring
System (HMI)
• Identification system
• Industrial communication
• Industrial control
• PC based automation
• Sensor system
• Vision system
-Working scope for construction
company
Ferrero would like to identify 2 types of
suppliers for the IT category:
1.One is the equipment supplier who
produce or distribute the equipments
in the scope;
2.The other is the GC supplier who
don’t produce equipments but can
provide:
installation of component
(customized or not)
cables and racks installation
WiFi installation (antenna, ..)
Services (like setup of active
component)
Datacenter Setup

15. 1742 suppliers initially identified leading to 5 Chinese suppliers being selected in
addition to global European suppliers
© 2015 Dragon Sourcing. All rights reserved. 15
Category
No. of
suppliers
identified
No. of suppliers
go to pre-
screening
No. of
suppliers RFI
sent
No. of suppliers
RFI received
No. of
suppliers
audited
No of suppliers
selected for RFP
No of suppliers final selected
Pipelines 284 90 36 21 9 9
0 (client decided to use 1 engineering company
to do the project management and source
products from suppliers selected by DS)
Tanks and Silos 83 51 39 22 5 5
Utilities-electrical 223 87 65 47 10 4
0 (As client decided to use global European
supplier for all electrical utilities)
Utilities-
mechanical
431 104 104 47 12 6
1 for HVAC
1 for Chiller
Part of a
Production Line
394 208 158 77 27 11
0 (Chinese suppliers not capable of matching
European requirements)
Packaging
Machine
69 69 50 34 12 4
0 (Chinese suppliers not capable of matching
European requirements)
Engineering
service
25 25 15 14 6 6 1
Construction
service
34 34 9 9 8 8 1
Automation 72 40 18 11 11 4
0 (Chinese suppliers not capable of matching
European requirements)
IT 127 54 54 37 6 4 1
Total 1742 762 548 319 106 61 5

16. Agenda
© 2015 Dragon Sourcing. All rights reserved. 16
1. Introduction
2. Projects – July 2013 to May 2014
3. Projects – May 2014 to Sept 2015

17. 74
39
27
8
14
8
4
2
8
5
2
1
4
3
1
0
100
55
34
11
0
10
20
30
40
50
60
70
80
90
100
110
Total projects Completed
projects
On going
projects
On hold
projects
Project Overview
Others
Instrument
Service
MRO
1717
From May 2014 to sept 2015, more than a 100 sourcing projects were carried out
© 2015 Dragon Sourcing. All rights reserved.
Category
Total projects
Completed
projects
On going
projects
On hold
projects
No. % No. % No. % No. %
MRO 74 74% 39 71% 27 79% 8 73%
Service 14 14% 8 15% 4 12% 2 18%
Instrument 8 8% 5 9% 2 6% 1 9%
Others 4 4% 3 5% 1 3% 0 0%
Total 100 100% 55 100% 34 100% 11 100%

18. 18
The work covered all of the services and MRO requirements for the plant
MRO
Uniform sourcing Completed
Box sourcing Completed
Drum sourcing Completed
Air shower/air curtain Completed
Stationary-staples Completed
Small tool supplier sourcing Completed
Washing machine Completed
Plastic and wooden pallet Completed
LED lighting Completed
Distributor mechanical material Completed
Workshop list Completed
Metal label Completed
Dust collector Completed
Dry Ice Blasting Completed
Filters bags inlet/outlet sourcing Completed
Locker Completed
Pb ball Completed
Diesel oil Completed
Boiler Completed
Desk for QA Completed
Label printer Completed
Gasket & Oring Completed
Protection products Completed
Nameplate Completed
Cleaner Completed
Oil supplier sourcing Completed
Alcohol supplier sourcing Completed
Vacuum cleaner Completed
Chairs Completed
o3 generator Completed
Trash bag Completed
Aluminum wire mesh Completed
Legend
Completed
On going
On hold
MRO
Welding kit Completed
Safety video Completed
Meters Completed
Canteen POS system Completed
Hazelnuts container Completed
Sparking water Completed
Dozier equipment Completed
Metal label Completed
Stainless table On going
Stairs On going
Container On going
Fridge On going
Aluminum platform On going
Max printer label/ribbon On going
lock system On going
Toilet paper On going
Acoustic panels On going
Doors On going
Deodorizing tower cover On going
Medicine On going
Signage On going
Hydrogen concentratoin
detector and alarm system
On going
Speed sensor and camera On going
Sensory cup & spoon On going
Micro media On going
Sieve On going
Glasses box On going
Patrolling rod On going
Condenser shelf On going
Adhesive tape On going
© 2015 Dragon Sourcing. All rights reserved
MRO
Decoration On going
Clock On going
Video system for meeting room On going
Water shelf On going
Platform for checking
products inside the trucks
On hold
Carton press machine On hold
Lean lift sourcing On hold
Pallet turner On hold
Deep cleaning system On hold
Vacuum machine for
hazelnuts ton bag
On hold
Rubbish bin On hold
Cover for machinery: :Lexan On hold
Service
Cleaning and pest control
service
Completed
Security service Completed
Industrial kitchen products Completed
Hotel Completed
Scouting for wastesupplier Completed
Internet & telephone Completed
EHS consultant company
sourcing
Completed
Household waste Completed
Printer service On going
Occupational Hazard
Assessment
On going
Greenery On going
Waste Oil On going
Doctor service for Ferrero
plant
On hold
Civil maintenance service On hold
Instrument/Equipment
Chocolate melting tank Completed
Vacuum machine for
sampling
Completed
Movable and fixed
wrapping machine sourcing
Completed
Roche cartoner Completed
Chocolate mould Completed
Lab instrument sourcing On going
tackle/crane for plastic film On going
Vacuum machine for
Roche
On hold
Others
Congress or Expo
Investigation
Completed
Computer Completed
Sky tunnel/ skylights
system
Completed
Aluminum sheet On going