Sherbourne Consulting

Case Study: Asia Sourcing Challenge for Medical Devices

Asia is becoming an important player in medical devices — particularly for consumables. Capability and quality is on the rise as automation of assembly and packaging is introduced.

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Suppliers can be found in countries such as China, South Korea, Taiwan and Malaysia.

Case Study Summary

Our client was a SME with manufacturing locations in the US and UK: producing and selling branded medical consumables worldwide.

  • Their sales and marketing team wanted to source consumable medical products from Asia at defined target prices for own-brand labeling.
  • One product was already being manufactured by the company, but was not meeting the market’s pricing expectations.
  • We went to considerable lengths to transfer knowledge to the client’s internal teams — ensuring that the process could be replicated internally in the future.
  • Satisfactory vendors were established: offering own-brand labelled products at considerable savings. Stringent international quality standards were met, with vital strategic lessons learnt from the sourcing exercise.
Photograph of Graham Barker, China consultant

For enquiries, please contact: Mr. Graham Barker
Medical Procurement Specialist
+44 (0)1789 731 803
LinkedIn | Email

Sherbourne Consulting has extensive experience in Asia, with specialist consultants based in the UK and China. We are able to provide long-term support across a wide variety of manufacturing sectors.


Approach for Procurement & Sourcing in Asia

One required product type was not being manufactured by the company, while another was exceeding acceptable price points.

Our proven approach to sourcing in low-cost countries was adapted to meet the specific needs of the client and this market sector.

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Stage 1: Where to Source in Asia?

Working with the client, we developed a comprehensive brief covering all aspects of:

The brief should be clear about which elements are essential vs. desirable.

We were very meticulous at this stage so that the search could be fully scoped and information compiled for a detailed RFI.

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RFIs and RFQs must be carefully designed to elicit enough information, but not be too complicated so as to inhibit responses.

Significant time must be allocated to ensure complete responses are received, and that the reasons for non-response are understood.

The latter may be due to caution, lack of understanding, or existing/conflicting distribution arrangements in the destination country.

Stage 2: Compile and Narrow Down Vendors

We identified vendors in the agreed countries in order to develop a “long list” of potential suppliers.

In order to save time and money, we sifted out unsuitable companies in China (via phone/email) prior to the RFI and/or RFQ.

The Medica trade exhibition in Germany was visited to investigate additional sources and to talk directly to companies who had responded to RFI.

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Thereafter, we summarised the data from the potential suppliers, including delivered price mapping against target prices, for review with the client.

During this review, we reached clear agreement about the potentially viable sources — shortlisted before preliminary audit visits.

“It can be helpful to weed out companies that only export to Asia or Africa, since they may not meet medical standards in Europe or the USA.” Dave Roberts, Sherbourne Consulting

It is important to identify trading companies who do not possess manufacturing of the products within their group, as they will usually not disclose the identity of the factory — making audits impossible.

Stage 3: Initial Audit in China & South Korea

Dave Roberts, our procurement consultant based in Xiamen, arranged audit visits to review:

7 companies in China and 2 in South Korea were visited at this stage.

We obtained representative samples in sufficient numbers to permit testing and comparison with appropriate standards.

Audits, sample test results, and the overall potential of suppliers were reviewed in order to agree on their suitability for a visit with the client’s purchasing and quality-assurance staff.

This approach is designed to avoid the additional, substantial costs associated with wasted visits by UK-based client staff.

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The final shortlist was based on an analysis and discussion of:

“The number selected depends on whether suppliers stand out from the rest in terms of the agreed criteria. In other words, if they would be suitable long-term partners for our client.” Graham Barker, Sourcing Consultant

These features were compared with the profile of essential and desirable elements.

Stage 4: Auditing of Final Shortlist

It was agreed that 2 vendors in Korea, and 1 in China would be audited further (as well as 2 sub-suppliers of components in China). Audits were conducted by external quality consultants, accompanied by senior purchasing staff.

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Our work programme included:

Subsequently, Sherbourne Consulting uncovered and resolved an issue that cropped up with a sub-supplier to one of the vendors. Despite the vendor already supplying to the US market, the subcontractor had unacceptable manufacturing and quality processes.


Results: Strategic Issues Identified & Quality Vendors Established

As a result of the careful planning and a thorough, staged approach to the project, the client made a very successful visit to China and Korea and is now implementing supply with two vendors capable of meeting its cost expectations.

We achieved further improvements in pricing through negotiations conducted during the visits — based on the trust and credibility we established for our client.

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In addition, new internal processes were developed to manage future procurement of new products. A project manager was appointed by the client to ensure that they had the dedicated resources available to conclude the implementation steps.

Finally, based on outputs from the purchasing process, Sherbourne Consulting conducted a detailed evaluation of the competitive position and strategic implications for the client in worldwide markets.

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Benefits Provided to Our Client


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