Supplier Right Sizing: Building Your Product Where it Makes the Most Sense

Hello All,
The EastBridge team of manufacturing engineers, international trade professionals and logistics specialists manage a portfolio of more than six hundred supply partners around the world. We’re constantly identifying, auditing and qualifying new vendors to compliment and diversify our supply base.
In many cases, we have relationships with vendors that are in identical product segments. In the case of deep drawn formed metal, we have more than fifteen vendor relationships. For cable & wire harnesses, we work with twenty-two suppliers. For blown, injection molded and thermo-formed plastics, we have dozens and dozens of suppliers.

Why do we have redundant suppliers in all product segments? Beyond the obvious factors of mitigating manufacturing risk and providing support in multiple geographies, part of our strategy is driven by the vendors’ requirements.

As essential as it is to match the factory’s capabilities to your product’s certification, specification and technical requirements, it’s just as critical to pair your and the supplier’s commercial goals and standards. While we may know the world’s best supplier of hard anodized aluminum extrusions, if their MOQ is 25,000 KG per month and you need 200 meters per quarter, the technical fit is meaningless.

Take a look at a typical “customer fit” checklist used by a “Tier III” ECM provider:

    1. How many employees does the company employ? How many are in R&D?
    2. What is the customer’s annual sales volume? What is their annual growth rate?
    3. Is the customer a public company? If not, please share their financials.
    4. What is the specific path to project approval? Quotation generation, on-site audit, specification confirmation, etc.?
    5. What date can we begin production?
    6. What is the supplier development strategy? One or more suppliers? If you cannot commit to $3.0M in annual revenue by the conclusion of Year Two, you should initiate production with a different supplier and transfer the program after it reaches maturity.
    7. How price sensitive is the program?
    8. Are there any special international certification requirements?
    9. What is the delivery frequency? Weekly, monthly, something else?
    10.How long is their requested warranty period?

Intrusive and painful? You bet. Logical on the part of the supplier? Absolutely.

A major value add at EastBridge is the guidance of this customer-supplier matching process. Regardless of your company’s size, technical know-how and the experience of your team, Right Sizing the relationship is an essential requirement for manufacturing success.

Jack Daniels

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