Westrom intro v13

WESTROM Group

China SourcingManufacturingEngineeringSupply ChainChina Services

© 2010, WESTROM-DTB, Ltd.© 2010, WESTROM, LLC

China ● Hong Kong ● USAwww.westrom.net


© 2013, WESTROM-DTB, Ltd.© 2013, WESTROM, LLC


WESTROM Group

Introduction and Capability Overview

WESTROM Group Introduction

Our Vision To provide our customers innovative design, engineering and product developmentTo protect and provide small and medium sized western companies a low cost and quality Chinese supply – supply that is normally only available to large companies

Key Points

WESTROM is not a “Trade-Show-and-Go” China broker or trader, it is an engineering, manufacturing and China sourcing compa ny

© 2013, WESTROM-DTB, Ltd. © 2013, WESTROM, LLC 2

Key Points • WESTROM leverages our core competencies for our customers:

– US design engineering and prototype development, plus engineering and design preparation for China sourcing

– US and China quality, tooling and manufacturing engineering

– China supplier selection, sourcing and management

– International logistics, banking and order management

• WESTROM gives small and medium sized US manufactures access to the low cost China supply market, with the delivery and quality achieved by large companies

• WESTROM also provides professional services to assist with your China projects

WESTROM Group has China operations focused on manuf acturing & supply management and US operations focused on engineering & sales

WESTROM, LLC

o WESTROM, LLC is the group’s US engineering and sales company delivering design engineering, manufacturing

engineering, marketing, sales, order management, US imports and domestic logistics, plus manufacturing

engineering for China

o COWBOY TRADER is the consumer goods trading division of WESTROM, LLC with headquarters and

warehousing in Hot Springs, SD USA

o WESTROM, LLC was established in 2002 and is a LLC registered company in South Dakota, USA

About WESTROM


WESTROM-DTB, Ltd.

o WESTROM-DTB, Ltd. is the group’s China operations company. It manages China manufacturing, provides China

supplier management, sourcing, China exports, international logistics and China business services

o WESTROM-DTB, Ltd. is a limited corporation chartered in Hong Kong with registered offices in Hong Kong, and

wholly owned registered offices in Guangzhou, China. It was formed in 2003

WESTROM leverages our competencies to source & mana ge supply from China, plus provide engineering and manufacturing s ervices in the US & China

WESTROM Group Offerings

Engineering Manufacturing China Sourcing China Service s

Customer Needs

Product Design & Development

US Manufacturing Services

Quality Low Cost China Supply

China Supply Improvement

WESTROM, LLC USA

● Electrical and mechanical design engineering

● Prototype & tooling development and

● Manufacturing and quality engineering

● Manufacturing process characterization

● China supply preparation:

– Design for China manufacturing

– China quality specification

● US design engineering for China manufacture

● US-China manufacturing strategy development


LLC USA development and manufacture

● Design characterization

characterization

● Quality & specification development

development

– Design & manufacturing process characterization

strategy development

● China supply crisis mitigation

WESTROM-DTB, Ltd.

Hong Kong & China

● Tool sourcing and manufacture in China

● Turn-key China supply:

– Supplier selection

– Sample part production & quotation

– Supplier development & management

– International trade, order & logistics management

● China manufacturing engineering & quality

● Supplier capability & quality improvement

● Outsourced China supplier management

● Green & brown-field plant development

WESTROM specializes in industrial electronics, the r elated electro-mechanical and plastics sub-sectors, plus light industrial mec hanical products

Industrial Components, Assemblies & Products

o Membrane keypad switches & touch screens

o Power & signal transformers and inductors

o Overload motor protection modules & controls

o Character and graphic LCD panels/modules, CTN-LCD modules, TAB modules, COG modules

Light Mechanical Components, Assemblies &

WESTROM Industrial Sectors


Light Mechanical Components, Assemblies & Products

Assembly Machines

Plastics & Molding

Specialty Consumer Durables

Textile Cloth, Cut & Sew

Tooling Design, China Tool Manufacturing and China Tool Prove – all tooling types

Retail Package Design and Retail Package Production

For small and medium enterprises there are a number of options for China sourcing. Some approaches are appropriate, others a re not

China Brokers & Traders

In this approach, a number of brokers and traders a re used as intermediaries to purchase parts from Ch ina.

Typically:

o Brokers receive payment or a % of the purchase cost

o The identity of the Chinese suppliers (often multiple) are held confidentially by the broker

o Chinese supplier management is minimal and transaction reversals, e.g. returns, are very difficult or impossible

o Quality and delivery performance is highly variable and difficult (or impossible) to manage & improve

o Approach is best suited for sourcing of standard commodity or China catalogue parts & products

China Sourcing Options


o Approach is best suited for sourcing of standard commodity or China catalogue parts & products

China Supplier Direct (do-it-yourself)

In this approach, the US manufacture identifies and starts a relationship with a number of Chinese sup pliers. It

is a trial-and-error approach to finding the right suppliers. Typically:

o US companies identify Chinese suppliers through tradeshows in China and Hong Kong, “trade-show-and-go”

o Parts and products are purchased directly from China suppliers, typically through escrow and trade letters of credit

o Finding quality Chinese suppliers that support small & medium sized business volumes is a difficult process that is highly time

and cost intensive. It can take years

o Development of trust and relationship (e.g. guanxi) by personnel dedicated to the task can take substantial time

o To be successful; executives, managers, and engineers will incur costly, regular and extended China travel

o This approach is often used by large companies with purchasing volumes that are considered significant by Chinese

suppliers and large enough to justify the cost of US based China supply management

A China engineering & purchasing office provides th e key capabilities, but is rarely establish by small and medium sized business due to cost

China Purchasing Office (do-it-yourself)

Establishing a China Purchasing Office (a “wholly ow ned foreign enterprise”) in China is a significant

investment in time, cost and effort:

o A business is incorporated in Hong Kong. The Hong Kong office must operate for a minimum of year, then

formation of a wholly owned foreign enterprise can begin

o An aggressive duration is 2-3 years, from start to achieving a wholly owned China purchasing & engineering office

o The China operation is staffed with a combination of Chinese and expatriates that provide sourcing, purchasing

China Sourcing Options (con’t)


o The China operation is staffed with a combination of Chinese and expatriates that provide sourcing, purchasing

manufacturing, quality and engineering

o Establishing the Hong Kong and China operation typically requires significant US management and US engineering

focus and time

o It also usually involves employment of ex-patriot resources or US resources with meaningful China experience, i.e.

have worked in China for more than 5 years

o This approach is used by large companies with the capability to manage and govern international operations

o China spend must be a minimum of $5M USD per annum to break even, i.e. cost saving from China supply equals

the cost of running your own China purchasing and engineering office

Regardless of the China sourcing option employed, t o be successful there are four key business functions that must be well manag ed

China Supplier Management

o Selection & qualification

o Supplier capability development

o Schedules and purchase order priority management

o Development and management of relationship, guanxi

Engineering (for China Mfg)

o Design and engineering documentation to the “China Standard”

o Design engineering and specification characterization

Either managed well or poorly, these areas will be addressed by:

• Your company, or

• The Chinese supplier, or

• The external China sourcing provider

Key Business Functions


o Design engineering and specification characterization

China Manufacturing

o Manufacturing process characterization

o Tooling design, build and qualification

o Quality assurance and specifications

International Trade and Logistics

o Export and China customs

o International logistics; China – Hong Kong and Hong Kong –US

o Imports and US customs

o Trade finance, China supplier payment and international banking

The trade partners will collectively have or develop the necessary skills to satisfy these requirements

WESTROM has the necessary people, experience, resources and business processes to successfully source and manufacture in China for your company

WESTROM gives small and medium sized US companies ac cess to the China supply market, with the delivery and quality achiev ed by large companies

WESTROM OEM/ODM Sourcing

WESTROM combines our China and US capabilities to a chieve your project objectives:

o Engineering designs are completed or existing designs are reworked for China sourcing and the designs are characterized to establish the critical quality specifications

o WESTROM selects qualified subcontractors from a pool of Chinese suppliers, with an intimate knowledge of those supplier's real capabilities, capacities and constraints

o WESTROM characterizes the China manufacturing processes to ensure the critical specification are met

o China supplier quality and mfg capabilities are reviewed, and improved if necessary, to meet quality and cost requirements

o WESTROM organizes and manages the international banking, international logistics and domestic delivery

o WESTROM manages the China manufacturing, the China supply chain and the risks from China sourcing

WESTROM China Supply


o WESTROM manages the China manufacturing, the China supply chain and the risks from China sourcing

You order and WESTROM delivers quality low cost par ts/products to your shipping dock from China, on ti me

WESTROM has the critical experience, relationships and capabilities in the US and in China

o Key personnel have extensive experience1:

– 15 – 18 years experience in China manufacturing and operations management

– 15 – 20 years experience in design engineering, manufacturing engineering and manufacturing

– Experience starting and running over 20 sales and manufacturing operations across the US, Mexico and China

o WESTROM has dedicated US and China based operations and personnel

o Deep understanding of the China supply base; WESTROM or its key personnel have been working in China since 1994

o Long-term relationships with dozens of Chinese manufactures and an extensive guanxi network

o Extensive knowledge of China business practices, business law and a network of Chinese business resources

WESTROM has the necessary people, experience, resou rces, business processes and China suppliers to successfully supply your company from China

Note: 1. Reference the appendix for key personnel profiles

WESTROM also provides professional services to assi st with your China engineering, sourcing and manufacturing projects

China Supplier Development, Qualification & Quality

o How do you really know if your supplier has the capability to reliably deliver your order?

o Do you have the ability and personnel to assist and support your China suppliers to develop capabilities

and resolve quality issues? And, can it be executed quickly?

o Does the supplier have an adequate quality system? Are the specification and processes correct for

your parts, products or project?

WESTROM provides supplier development, mfg engineer ing, testing and quality services

Outsourced China Supplier Management

WESTROM China Services


Outsourced China Supplier Management

o What types of skills and how many people are needed to manage the China suppliers on an on-going

basis? And, Can all the requirements be met by a single resources?

o How will the suppliers be managed remotely?

WESTROM provides China supplier management services

China Sourcing Crisis Mitigation

o China supplier issues occur regularly; some are crises:

o Have a container locked up in China Customs? Catastrophic quality problems? Has your sub-

contractor’s General Manager walk-off the job or worse is in jail?

o WESTROM personnel have been in China 18+ years, have seen it before and can fix it

WESTROM’s engineering, manufacturing and operations people can resolve your China

problems or crisis

Additionally, WESTROM provides professional design engineering, prototypes, quality and mfg engineering services for US and Chi na projects

Mechanical Design & Engineering

Product Design – internal combustion engines, security services, consumer hand tools, NEMA certified enclosures

Machine Design – Mechanical assembly machines, automated assembly lines & work cells, material handling systems and machines

Tooling Design – injection molds, punch die sets, welding fixtures, weld and assembly fixtures & jigs

Packaging – store ready packaging & branding materials for consumer durables

Electrical Design & Engineering

Product Design – LCD integrated panels, membrane keypad switches, inverters, power supplies, circuit boards,

WESTROM Engineering Services


Product Design – LCD integrated panels, membrane keypad switches, inverters, power supplies, circuit boards, controllers, control sub-assemblies, transformers, coils and wound magnetic products of all types

Tooling Design – Electrical assembly machines, wave soldering, automated assembly lines & work cells, material handling systems and machines, coil winding machines

Engineering Control

Control – WESTROM has the process and tools to maintain US and China engineering controls over the full lifecycle, prototyping and new product introduction (NPI) to product end-of-life (EOL)

Design for Manufacturing – WESTROM designs for manufacturing in the US and in China, to reduce the total cost of ownership

Prototyping, Quality & Validation

Specifications – WESTROM has the experience and capability to characterize process and designs to ensure the correct specifications and standards have been established

Quality & Integration – We ensure that our testing, specifications and quality systems integrate to your system

It’s 11PM in the US. Do you know where the parts ar e, who is making them, what their quality is, when they will be delivered and if they have lead paint?

The ability to trust and manage China supply, while achieving the desired cost reduction, is critical:

o Management and control is difficult or impossible with a China broker or trader

o It is a lengthy, high cost, and difficult trial-and-error process to source directly from China suppliers

o Establishing a China purchasing/engineering office is ideal, but it is only cost effective for companies with a China

spend that exceeds $5M USD per annum

Significant experience in China manufacturing & engineering mitigates many of these issues. However, the problem

with 15 years of China experience is that it takes 15 years to get

Working without a Safety Net


How can you build trust if you can not communicate and relay your bottom line needs?

How can you communicate & manage in China, when even US metaphors (let alone US business practices) do not

translate and your experiences in the US do not relate to your suppliers?

Key WESTROM Group personnel have worked

together in the US and in China for many years

WESTROM is technically sound, has the China

relationships and knowledge of the China supplier

and understands how to do business in China.

Work with WESTROM and help ensure that your

China projects do not turn into a flaming pile

Wrap-Up

Joel T. Rickenbach

President

WESTROM, LLC, USA

WESTROM-DTB, Ltd., Hong Kong

US Mobile: +1 605 890 0570

China Office: +86 20 8268 5545

HK Mobile: +852 6054 0397

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美國西河國際管理有限公司

香港西河國際咨詢股份有限公司

美國手機 : +1 605 890 0570

中國電話 : +86 20 8268 5545

香港手機 : +852 6054 0397




WESTROM personnel have deep experience in engineeri ng, manufacturing and supply chain management in the US and in China

Key WESTROM Personnel

Joel T. Rickenbach, Founder & President, WESTROM G roup

● 18+ years of domestic and international experience R&D, and operations and corporate management

● 16+ years of business & engineering experience in China, with a scope of 3,000 to 8,000 personnel

● Over 20 manufacturing, sales & engineering facilities start-ups in the US, Mexico & China

Clayton Jones, Managing Director, WESTROM-DTB

● 18+ years of domestic and international experience in manufacturing and supply chain management across aerospace, industrial machinery & chemicals, soft commodities, defense logistics, consumer


across aerospace, industrial machinery & chemicals, soft commodities, defense logistics, consumer durables, food & consumer packaged goods and wholesale distribution

● 10+ years management consulting experiencing in supply chain transformation programs, business strategy & architecture, supply chain strategy and design and quantitative financial analysis

Mike Leraas, Mechanical Designer & Engineer, WESTRO M, LLC

● 20+ years of design, fabrication and technical experience of prototypes development and limited run production in professional racing (NASCAR, WoO, et al), and in the automotive and industrial products industries

● 12+ years management and supervisory experience in professional racing industry

● Machine Design, Fabrication & Production Mgmt experience in pharmaceutical industry.

● Degrees and qualifications in mechanical design, engineering, machining, welding, computer aided design, and 2D and 3D modeling

WESTROM personnel have deep experience in engineeri ng, manufacturing and supply chain management in the US and in China

Key WESTROM Personnel

Jim Holdahl, Contract Electrical Designer & Enginee r, WESTROM LLC

● Degreed and experienced electrical engineer, with 18 years experience in PCBA, Magnetics Design, general circuit design

● 10+ years experience in electrical and electronics design engineering for China manufacturing

● Experienced electronics laboratory designer, developer and fabricator

Sam Yang, Marketing Manager, WESTROM-DTB

● 8 years experience in industrial design, industrial & consumer packaging & management in consumer electronics manufacturing


● Extensive knowledge of China sales & marketing and Chinese business practices and methods

● Deep and wide supplier contacts and knowledge of suppliers in China’s Pearl River Delta region

Ellen Su, China Office Manager, WESTROM-DTB

● 15+ years of China manufacturing management, export management, china supplier management and engineering in textiles, industrial electronics and consumer electronics industries

● Deep knowledge of the China supply markets, supplier capabilities and capacities

● Holistic and detailed understanding and management of China customs, logistics and trade regulations

Janet Goossen, US Business Manager, WESTROM Group

● 10 years experience in banking & retail management

● 6+ years US accounting and taxation regulations and management

● 6+ years management experience in domestic logistics, importation and US Customs

Documents

Westrom intro v13