Sourcing and Procurement can be just as important a business strategy as product line and market decisions. How you source your components, assemblies and manufacturing services can sometimes be the difference between success and failure.
Through intelligent sourcing you can reduce your costs, improve your process, quality and reliability. And yet, procurement isn’t only about reducing or controlling costs. It’s also about managing supply chain risk in the short and long term. If you have ever experienced the unexpected EOL (end of life) of a component or OEM assembly you know exactly just how destructive such events can be.
Years ago we helped a client who’s entire product like was taken off the market through exactly this issue. When a critical assembly went EOL our client, quite literally, was out of business. They could not manufacture a single unit of their multi-SKU product line.
We got involved and quickly brought in expertise and access to a global network that allowed them to continue manufacturing their product until we could help them redesign the product to eliminate the problematic assembly.
Put simply, sourcing and procurement is mission critical. Be it consumer, medical, commercial, industrial or aerospace products, the supply-chain has to be engineered just as critically as the product itself. Without reliable sourcing there is no product.
When approaching a new project (ideally at the early design stage) we will typically maintain and drive awareness of at least the following
- Cost-aware component and assembly engineering design
- Optimize specifications based on sourcing knowledge
- Manage timelines based on lead-time knowledge
- Explore global geographical sourcing based on a wholistic cost model
- Explore opportunities for insourcing vs. local and offshore outsourcing options
- If requires, setup systems to generate and track deep sourcing and manufacturing analytics
- Defensive multi-sourcing for critical components and assemblies
- Defensive multi-sourcing for turn-key finished product manufacturing
- Awareness of regulatory, transport and duty cost structures
- Logistics