Supply Chain Management
SINO TRADING were brought in when a UK client faced an unexpected increase of 22% on the cost of electrical earthing equipment.
The company had dealt with the same manufacturing plant for four years, believing it had a direct deal with the factory. But when we undertook an independent audit, we discovered that three additional companies had inserted themselves into the supply chain – an export house and two outsourcing agents – each adding their own commission to the actual production costs.
By renegotiating the contract and stripping the supply chain to its correct size, we reduced the actual manufacturing increase to just 5% – the amount the factory actually needed to maintain supply of the product. Result: a happy client who can still supply its onward customers at a profitable price. And a happy supplier who kept the manufacturing contract without loss of margin in the process.