One of our clients asked Dragon Sourcing to identify new, competitive suppliers for investment castings. The goal was to source 50 items used across Europe and China, weighing between 0.7KG and 113KG. The geographical focus included China, India, Thailand, Czech Republic, and Turkey.
Our Approach
The project followed a structured approach over 12 weeks:
- Demand Analysis: Defined product specifications, volumes, and production technology requirements with the client.
- Supply Market Analysis: Identified a long list of potential suppliers using B2B websites, DS databases, fair catalogues, chambers of commerce, magazines, and networks.
- Telephone Pre-screening: Selected suppliers based on their capability, size, and interest.
- NDA Administration: Distributed NDAs to willing suppliers.
- Developing RFI/RFQ: Prepared documents to pre-qualify suppliers based on competitiveness and capabilities.
- RFI/RFQ Administration: Translated and distributed RFI/RFQ documents, followed by telephone follow-ups.
- Analyzing RFI/RFQ Responses: Analyzed responses, estimated logistics costs, and ranked suppliers.
The analysis identified 305 suppliers, with 290 contacted. After pre-screening, 55 suppliers received NDAs, and 45 returned them. Subsequently, 38 suppliers received RFI/RFQs, and 25 responded.
Key Findings
- Supplier Distribution: The majority were from China (185) and India (56).
- Shortlisted Suppliers: 11 suppliers quoted all 50 items.
- Cost Breakdown: 10 suppliers provided detailed cost breakdowns.
- Savings: Potential savings ranged from €72,000 to €300,000, achieving a 14-58% reduction.
- Top Suppliers: 9 suppliers were recommended for auditing based on their high RFI scores, lower price per kilogram, and ability to produce most items.
- Potential Savings: The total potential savings amounted to €743,000, representing 33%.
Supplier Performance
- Top Supplier: A Chinese supplier using Sodium Silicate and Sand Casting processes, offering the highest potential savings of €743,000.
- Overall Scores: 31 suppliers were ranked, with an average score of 74. Suppliers scoring above average demonstrated better performance in cost and capability metrics.
The project successfully identified and recommended competitive suppliers, highlighting significant cost-saving opportunities. The structured approach and detailed analysis ensured that the client received valuable insights into the global supply market for investment castings.