With multiple companies working with us in China, we are constantly working on cost saving solutions for our clients their supply chains. Optimizations to gain more profits. When discussing with each company the cost saving opportunities in their supply chain, we always emphasize that “control” is key to implement structures and solutions to gain major profits within existing supply chains.
The machine of the supply chain
The supply chain works similar like industrial machinery does. A machine has multiple controls to let the machine run and preform. If you are able to control the controls of the machine, you are also able to adjust the settings of these controls. By adjusting these controls you can let the machine run based on your settings. Every control of the machine is then a tool to adjust settings and let the machine preform in a certain way. How more controls you can set, how more you are able to optimize every control and its settings to create the best performance and eventually the best result.
Supply chain in China
A supply chain in China is very comparable to a machine described above. From the purchase of the raw-material to the production of the product till the shipping. Many companies and people are involved within your supply chain processes. These people and companies involved have direct influence on processes and your supply chain results. Controlling these processes means you can control the people and companies involved. In this way you can control your supply chain.
Hidden supply chains you can’t control
When buying at a trading company or at a classic sourcing company, the actual supply chain is covered and hidden. You have no access to resources, opportunities or influence like factories or agreements made between the companies. You will have no influence on the optimization of the supply chain behind the trading or sourcing company you buy at.
The controls/tools of the supply chain
Controlling the supply chain means you are able to control the tools to optimize the settings of your supply chain. Which tools are needed to control a supply chain is for every company different. Working ways, business cope, company policies etc. will all have some influence on which tools are able to be used to control your supply chain.
Gain tools, gain control and gain profits
By gaining a tool you will be able to gain profit with the right settings. How more tools you will gain, the more you can control, the more profit you will be able to gain. It is therefore not only 1 tool which will earn you the profit. It is the collective of everything you do to control your supply chain that earns the major profit gains.
Tools: Yourself
Based on our interpretation, tools are 1. you and your own working way, 2. other local people/employees or services which can control a supply chain. For example, when you are doing the communication with factories by yourself, you are in control. Then you are the tool. Your working way and performance in the communication has direct influence on the performance of this process and whole supply chain. You can negotiate a prices, discuss agreements, propose solutions or anything that will improve the result of a factory or related to the factories result. However, mistakes made in these processes have direct bad influence on the process and further in your supply chain.
Tools: People / employees at location
The supply chain is extensive and is more often not able or profitable to be executed by 1 person. By hiring employees (people) you can outsource different processes, tasks and work within the supply chain. By controlling these people, processes and the way of working you will be able to have a direct influence on the performance of these processes and employees.
Tools: Services
In addition, you will always have services from companies like us to provide you solutions, knowledge and more control within your supply chain. However, important is that the services of third parties which you use are able to be influenced. Some companies have fixed working ways and structures which are not flexible. Static structured services are limited. More often these services don’t suit your supply chain well. We offer flexible services instead. With our services you have the opportunity to change the working way to a way that suits fully your supply chain and needs. Examples of services;
China consulting – Controls the insurance of knowledge when needed
Company verification/investigation – Control’s the truth about a company
Price negotiations – Controlling the best result in price
Communication via CIL team – Controlling communications and agreements
Production analysis – Controls your knowledge about where in the production it can go wrong
Production contracting – Controls and optimizing agreements and results
QC quality control – Controlling product quality
Loading check – controls a correct loading of goods of a container shipment
EU/USA Certificate verification – Controls conformity of the product
Warehousing – Controls the shipment before going out of China
Labeling – Controls a correct and scannable label
All these services named above are general examples are services which can be used as a tool. A tool to gain control on your supply chain and create settings to let your purchasing processes preform in the most cost saving and profit gaining way.