About the client
Industry: Home appliance
Product: Milk frother
Company Size: Established medium size company
Location: New Zealand
Challenges
- It took the client too long time to develop the customized milk frother product, therefore losing the market to Sunbeam EM0180, a competitor;
- Even with all the time invested, the customized milk frother was not cost-effective;
- The attempt to find an ideal ODM (original design manufacturing) factory via Google, Alibaba, Global Sources failed after months of trying;
- The attempt to find a right partner to work with by attending home appliance and other electronics & electrical exhibitions in both Europe and Asia also failed;
- Couldn’t get the cost break-down and key spare component suppliers’ information;
- Lacking leverage vis-à-vis price and quality control negotiation with manufacturers.
How we helped
- Communicated with the client on what had been done so as to avoid overlapping work;
- Identified the product specifications, functionalities and reliability, and the critical requirements of the sales market;
- Aligned with the client on the final decision-making matrix;
- Sourced a few renowned milk frother ODM factories;
- Conducted deep technical discussion with the selected manufacturers on manufacturing processes, quality control issues and cost drivers;
- Identified how interested the factories were to customize ODM products, and dug out their sales challenges in the European, New Zealand and Australia markets.
Results
- Identified the manufacturer for Sunbeam EM0180 and the potential strong backup manufacturers that shared similar capabilities and expertise;
- Identified key cost drivers;
- Drew up reasonable cost plan, lead time, quality assurance terms and conditions for the client;
- Saved more than US $120,000 a year;
- The lead time was reduced from 6 weeks to 2 weeks;
- Increased leverage in the supply chain by having backup ODM factories.
More customer stories
Supply Chain Management
Insight Solutions Global helped to improve the overall supply chain performance via reducing lead time, saving about $145,000 packaging costs, and building good supplier relationships.
Supplier Quality Management
Insight Solutions Global helped resolved the gap issue, drove the communication efficiency, guided the supplier to set up measurement system, and finally increased the yield rate to 99.48%.
Product Cost Reduction
By making the most out of the identified cost reduction opportunities, the client saved $857,635 in 3 years, earned the competitive edge on the market, and gained bargaining power in the supply chain.