Independence Day and Your China Supply Chain
July 1, 2022
On this Fourth of July we have been thinking about the value of independence in the China supply chain. Great buyers like to be in control. By “independence” we mean that buyers are “not dependent” on the whim of any particular supplier but are firmly in control of their own supply chain. Such buyers get value for their money, receive the quality they expect, and get their goods on time. In our experience, such independence from un-wanted factors usually translates into greater market share and better profits.
Dependence, on the other hand, often means accepting less-than-ideal pricing, making compromises on quality, and putting up with slow, late and unreliable deliveries.
In the spirit of Independence Day we put together the top five ways a good China sourcing team delivers independence:
– Escape the “captive buyer” trap: We previously discussed this topic in a blog post, Beware of Captive Buyer Syndrome – The Risks to Your China Buying Program. Through benchmarking and frequent communications with a range of competitive suppliers you can ensure that your favorite factory will not take you for granted.
– Get the quality you need: Using good management processes to ensure your quality requirements are clear, understood by the manufacturer and signed off on. Procedures ensure conformity are in place from molds and samples to full production. Your China team is on top of every detail and updates you regularly on the progress.
– Get your goods on time: No surprises. Your China team is an integral part of your USA operations and knows in advance when you need the goods. Flow charts, systems, and procedures ensure you know where bottle necks are so you avoid them and get your goods on time.
– Time: As Peter Drucker said, this is the unique, irreplaceable and necessary resource that all executives care about. A good team on the ground in China will save you lots of it. And, you will not be required to travel as much to ensure your supply chain is running smoothly. Your ability to delegate important missions will get you better execution, and your vision will be shared by your team, who will anticipate your needs.
– Corporate Social Responsibility: This is an increasingly important element of the supply chain, and here too, careful and rigorous procedures greatly facilitate audits and compliance.
It is a great feeling to be independent. And we hope that your supply chain already delivers much of that. Of course, we all know that the supply chain, by definition, is a mutually dependent process. And complete independence is therefore neither possible nor, when you think of it, really desirable. But good management can greatly reduce your dependence.
We hope you have a great Independence Day and, as always, we welcome your feedback in the comments below!
By Jocelyn Trigueros & Laura Dow
Editor’s note: This blog was originally published in July 2018.