European Retailer Diversify – A Case Study

Introduction

Amid rising geopolitical risks, inflationary pressures, and an urgent need to build resilient supply chains, a major European multinational retail group turned to Dragon Sourcing to reduce its reliance on China for air conditioning system components. With around 700 stores across Europe, the client needed a strategic sourcing partner who could deliver reliable suppliers outside China—without compromising on quality or lead time.

Project Objectives

The client’s goal was clear:

• Identify qualified manufacturers of air conditioning systems outside China

• Diversify the supplier base, focusing on Italy and Turkey

• Receive a comprehensive sourcing package including supplier profiles, market analysis, and sourcing recommendations

Dragon Sourcing’s Two-Stage Approach

Stage 1: Supplier Pre-Qualification

1. Demand Analysis
   Shortlisted 8 SKUs, representing a total annual spend of €4.78 million.

2. Supply Market Analysis
   Built a long list of 50 potential suppliers across Italy and Turkey using:

   • B2B platforms

   • Dragon Sourcing’s internal supplier database

   • Chamber of commerce data and trade magazines

3. Telephone Pre-Screening
   Filtered suppliers based on essential criteria like:

   • Production capability

   • ISO 9001 certification

   • Social compliance

4. RFI/RFQ Development & Distribution
   Created and sent customized RFI/RFQ documents, including:

   • Product and company capability questionnaires

   • Balanced scorecard for objective evaluation

5. Supplier Evaluation
   Collected and scored supplier responses using a weighted evaluation system.

6. Supplier Recommendation
   Provided a detailed analysis report with supplier rankings, profiles, and a shortlist for potential sampling and audits.

Stage 2: (Optional)

• Sample collection

• On-site factory audits

• Contract negotiation

Key Findings and Results

• 50 suppliers identified, 37 approved by the client for screening.

• Only 2 suppliers, both based in Turkey, fully completed the RFI-RFQ process.

• Both offered catalog-based products that aligned with client specifications.

Why Many Suppliers Were Disqualified

• Focus on domestic markets only

• Already at capacity or under long-term contracts

• Only producing industrial systems, not consumer air conditioning units

• Some companies were traders or had shut down

Supplier Response Summary

Both suppliers offered competitive FOB and DDP pricing for quantities based on 20-ft container loads, and both were willing to provide free samples within 10–15 days.

Conclusion and Next Steps

Thanks to Dragon Sourcing’s rigorous qualification process, the client successfully:

• Identified credible alternatives to Chinese suppliers

• Shortlisted Turkish suppliers with high compatibility for their product range

• Planned the next steps including sample testing and factory audits

This case demonstrates the effectiveness of strategic sourcing in mitigating regional risks and building a more resilient, diversified supply chain.

Why Choose Dragon Sourcing?

At Dragon Sourcing, we specialize in connecting global buyers with qualified suppliers from emerging markets, using a proven methodology, advanced e-sourcing tools, and regional expertise. If your organization seeks to reduce dependency on any single country, we are here to help.

Contact us to learn how we can help you build a smarter, stronger global supply chain.

Download the case study: https://cloud.dragonsourcing.com/index.php/s/etxXz8uLqOdjrhw/download.