Case Study- Look for suppliers in India, China etc. Food Sourcing

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  1. 1. Food Sourcing Case Study Shanghai, Mar 2016 Dragon Sourcing - Delivering sustainable sourcing value from emerging markets
  2. 2. 2016 Dragon Sourcing. All rights reserved. 222222222 Agenda 1. Introduction 2. Sourcing Approach RFI step RFQ step - Mushrooms : Quotations & potential savings - Beans : Quotations & potential savings 3. Results 4. Appendix : suppliers location
  3. 3. 3 2016 Dragon Sourcing. All rights reserved. 3333333 Introduction Project Objectives Look for suppliers in India, China, Thailand and Turkey with secure savings through Dragon Sourcing professional sourcing steps for Food categories Geographical scope China India Thailand Turkey (Turkey is not part of the contract scope but Dragon Sourcing team identified potential suppliers for both categories in Turkey ) Deliverables: RFI / RFQ and Score Card Supplier profiles
  4. 4. 2016 Dragon Sourcing. All rights reserved. 444444444 Agenda 1. Introduction 2. Sourcing Approach RFI step RFQ step - Mushrooms : Quotations & potential savings - Beans : Quotations & potential savings 3. Conclusions
  5. 5. 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 For this case, only step one value discovery is required by the client 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 2016 Dragon Sourcing. All rights reserved.
  6. 6. 2016 Dragon Sourcing. All rights reserved. 666666666 Agenda 1. Introduction 2. Sourcing Approach RFI step RFQ step - Mushrooms : Quotations & potential savings - Beans : Quotations & potential savings 3. Results 4. Appendix : suppliers location
  7. 7. 2016 Dragon Sourcing. All rights reserved. 777777777 The first step of value discovery was to develop a comprehensive understanding of the requirements: below specifications table are received from client including 16 product references: canned mushrooms (11), canned beans (5) Category Sub-cat. Specs Product name Ref art work PIC Samples received Y Qtity Current FOB (USD) Target price (USD) Pack SKU Questions Food Mushrooms C 1 Mushrooms whole, 400g 7340011341789 Y 18,480 0.715 can 1 H 2 Mushrooms, sliced, 185/115 g 7340011340294 Y 155,965 0.43 can 1 Specs same as H J 2 Mushrooms, pieces and stems, 170 g. 7340011438885 Y =H 673,920 0.52 jar 1 ? Y =H 745,920 0.52 can 1 G 5 Mushrooms, sliced, 280/170g 7340011351146 Y 76,923 0.6 jar 1 E 6 Mushroom sliced, 185/115g 7340011432449 Y 164,640 1.33 can ? 3 B 7 Mushrooms , whole 390g 6415712600655 Y 134,784 1.05 can 1 F 8 Mushrooms, sliced, 390g/185g 6415719429914 Y 426,384 0.65 can ? 2 D 9 Mushrooms, whole, 185/115g 7340011432432 Y 42,336 2.03 can ? 3 Specs same as D K 9 Mushrooms whole, 170 g. 7340011351139 Y =D 45,792 0.78 jar 1 I 10 Canned whole mushrooms MINIS, 185g 6415712600235 Y Yes, 6 151,200 0.7 can 1 A 11 Canned mushrooms, sliced, marinated/sauted in vegetable oil, 180/115g 6415712600129 Y Yes, 6 128,520 0.8 can 1 Beans L 13 kidney beans 7340011436829 Y 130,896 0.59 can 1 M 15 Mixed beans 7340011436867 Y 90,720 0.55 can 1 N 14 Kidney beans in chili sauce 7340011436836 7340011442271 Y 54,432 0.63 can 2 O 12 brown beans 420g/240g 7340011364214 Y 6,480 0.51 can 1 P 16 Brown beans, 420g 6415719415368 Y 250,000 0.53 can 1
  8. 8. 2016 Dragon Sourcing. All rights reserved. 88888 11 references of canned mushrooms (12 specs)... A B C D E F 6415712600129 6415712600655 7340011341789 7340011432432 7340011432449 6415719429914 6415719429907 mushroom Sliced in marinade can mushroom whole can X-tra mushrooms whole can Mushroom Whole can mushroom slices can mushroom Pieces & Stems can G H I K 7340011351146 7340011340294 6415712600235 7340011351139 Mushroom slices 2nd choice glass jar mushrooms pieces & stems, can mushroom whole small can mushrooms Pieces & stems glass jar Fakta mushrooms Pieces & stems glass jar Mushroom whole glass jar (= H) Packaging glass Jarr (= H) Packaging glass Jarr ( = D) Packaging glass Jar J 7340011438885
  9. 9. 9 2016 Dragon Sourcing. All rights reserved. 9999 ...and 5 references of canned beans L M N 7340011436829 7340011436867 7340011436836 7340011442271 canned Kidney beans Canned Bean Mix canned Kidney beans in chilli O P 7340011364214 6415719415368 Canned Brown beans canned brown beans
  10. 10. 2016 Dragon Sourcing. All rights reserved. 10 then an extensive supplier data base is built leveraging multiple sources of information Company and contact information No. Product category Supplier name Province City Website Source Contact Person Email Telephone Mobile 1 Mushrooms Supplier 1 Fujian 2 Mushrooms Supplier 2 Hubei 3 Mushrooms Supplier 3 Fujian 4 Mushrooms Supplier 4 Fujian 5 Mushrooms Supplier 5 Fujian Sources of Information - China Website name websites Remark Alibaba www.alibaba.com B2B for all over the world Global Sources www.globalsources. com B2B for all over the world Gongchang www.gongchang.co m B2B for all over the world Tradekey www1.tradekey.com B2B for all over the world ECVV www.ecvv.com B2B for all over the world EC21 www.ec21.com B2B for all over the world Hellotrade www.hellotrade.com B2B for all over the world Trade Asia www.etradeasia.com B2B for Asia Asian Products www.asianproducts. com B2B for Asia made in china www.made-in- china.com BSB for China Alibaba China china.alibaba.com BSB for China CHINA.CN www.china.cn BSB for China CCCME www.cccme.org.cn China Chamber of Commerce for electrical & mechanical products Baidu www.baidu.com TOP 1 source engine in China
  11. 11. Next step is to administer the RFI/RFQ process 2014 Dragon Sourcing. All rights reserved. 11 Production Capacity Company Profile Quality and certificate Contact detail information
  12. 12. Company and contact information RFI/RFQ Process follow up Product category Supplier name Province RFI/RFQ sent Intend to respond Last call follow up RFI received RFQ received Y/N Date Y/N If no, reason Date Comment Y/N Date If no, reason Y/N Date If no, reason Mushrooms Supplier 1 Fujian Mushrooms Supplier 2 Hubei Mushrooms Supplier 3 Fujian Mushrooms Supplier 4 Fujian Mushrooms Supplier 5 Fujian During the RFI/RFQ process, an RFI/RFQ control sheet is used to follow up the whole process 2014 Dragon Sourcing. All rights reserved. 12
  13. 13. 2016 Dragon Sourcing. All rights reserved. Based on the RFI/RFQ, company profiles are developed - Company and business information 13 GENERAL INFORMATION Company Name Supplier 1 Address N/A Town Chengxi Zip code 363112 Province Fujian Country China Company Website N/A CONTACT INFORMATION Contact Person N/A Title Trading manager Email N/A Tel N/A Fax N/A Mobile phone N/A BUSINESS INFORMATION Found Year 2009 Nationality China Production location Fujian Ownership Private Capital in USD 7 Million Work floor size (m) 533,360 Years in canned food business 30 years License for self import/export (Y/N) Yes Years of export experience 30 years Deliver to retailers in Europe (Y/N) Yes Current EUR retailers supplied Yes TURNOVER IN USD 2010 2011 2012 2013 10,000,000 15,000,000 16,000,000 20,000,000 % SALES EXPORT TO MAIN MARKETS IN 2013 EU (%) US (%) Others (%) Total (%) export 25% 5% 60% 90% MAIN CUSTOMERS Customers Industry Product category Country Percentage of sales MARUHA NICHIRO CORPORATION canned mushroom/lychee JAPAN 15% S.ISHIMITSU & CO., LTD. canned mushroom/bamboo shoot JAPAN 10% LOVERING FOODS LTD water chestnut UK 10% SUN YIK FOOD LTD. mixed mushroom HK,CHINA 5% CANEAST FOOD mushroom CANADA 5% EXPERIENCE - CANNED BEANS AND MUSHROOMS PRODUCT CATEGORY Canned Mushrooms Canned Beans YEAR 2012 2013 2012 2013 % of total sales revenue 60 60 60 60 % exportation 100 100 100 100 Exporting to Europe Yes Yes Deliver to lead retailers in Europe Yes No Producer or reseller Producer Producer Experience Y/N - Volume Yes Yes TOP 5 CUSTOMER CANNED MUSHROOMS Customers Industry Country % total turnover MARUHA NICHIRO Canned mushroom JAPAN 20 S.ISHIMITSU Canned mushroom JAPAN 10 SUN YIK FOOD Canned mushroom CHINA 10 CANEAST FOOD Canned mushroom CANADA 5 PAK SHINE Canned mushroom CHINA 5 TOP 5 CUSTOMER CANNED BEANS Customers Industry Country % total turnover TIGER Canned bean SOUTH AFRICA 25 ETECO Canned bean NIGERIA 20 LOVERING Canned bean UK 10 ALMA Canned bean LEBANON 5 PT Canned bean INDONESIA 5 HUMAN RESSOURCES Total # employees 200 Good English speakers (Y/N, #) 2 Production Quality R&D Admin 56 15 10 19 TOP 5 MANUFACTURED PRODUCTS Product name Yearly Volume produced 2013 MUSHROOM 10,000 LYCHEE 2,000 BAMBOO SHOOT 1,500 MUNG BEAN SPROUT 1,500 BEANS/PEAS 1,500
  14. 14. 2016 Dragon Sourcing. All rights reserved. Based on the RFI/RFQ, company profiles are developed - Production 14 PRODUCTION CAPACITY Volume 2013 (tons) Max. prod. capacity 2013 (tons) % occupation 2013 Planned prod. capacity 2014 (tons) Canned Mushrooms 8,000 12,000 67% 8,000 Canned Beans 1,500 2,000 75% 1,000 EQUIPMENT Equipment name Year purchased Brand/ country Main characteristics blanching machine 2010 CHINA 2PCS Vacuum machine 2014 CHINA 1PCS Grading machine 2010 CHINA 2PCS can wa

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