Sherbourne Consulting

Sourcing in Low-Cost Countries

  1. Planning
  2. Data Collection
  3. In-Country Intelligence
  4. Analysis & Decision Making
  5. Integrated Implementation
  6. Maintenance

Why Source Overseas?

Competitive pressures, aspirations to enter developing markets overseas, and globalisation — together with the growth of the internet — have driven a greatly increased level of sourcing of products from low-cost countries at lower costs than from existing local suppliers.

Photograph of Graham Barker, sourcing consultant

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

Sourcing directly (where volumes provide viability) can provide a sustainable competitive advantage when compared to purchasing from import distributors.

Our Process for LCC Sourcing

Stage 1 — Evaluation of Product Portfolio

The scope and scale of the opportunity needs to be assessed, and priorities established among the product categories that are to be sourced.

This stage may include rapid testing of specific products in a region to validate likely savings.

“Our approach to sourcing in Asia works and can be sustained because of our ability to research, locate, and evaluate sources objectively” Graham Barker, Consultant

Stage 2 — Research & RFI/RFQ

An initial sourcing round will identify potential vendors. It should match vendor capabilities against customer’s technical, quality, and intellectual property requirements.

Requests for information and quotation form part of this detailed process — designed to establish a recommended list of potential suppliers, and a range of pricing responses.

Stage 3 — Visits to Evaluate Total Cost

Visits to selected suppliers with the customer will build a full picture of suppliersʼ capabilities and their match to the product requirements.

This leads to a second round of specification and pricing review — with a full evaluation of the TCA. including freight, duties and third party costs. Options and overall strategy can be re-evaluated at this point.

“One of the methodology’s key benefits is that it reduces the risks that can be associated with outsourcing from low-cost countries.” Jeremy Waller, Sourcing Consultant

Stage 4 — Develop Findings & Recommendations

Final supplier shortlists are developed using price mapping, location reviews, and risk analysis.

Stage 5 — Implementation

The final steps of supplier implementation include sampling, testing of samples, contract negotiation, and scaling up of product supply.

Stage 6 — Supplier Management

It is critical to maintain regular contact with suppliers to ensure that relationships are consolidated, while conformance and pricing issues are raised at the earliest opportunity.

Delivering the Benefits of LCC Sourcing

Low-Cost Sourcing in China

We can provide long-term support in China to ensure sustainable supply:

  • assisting with new products, quality, and pricing issues;
  • maintaining close relationships so that issues can be managed quickly and cost-effectively.

Our approach is tailored to the individual product and customer requirements, and managed from a wholly independent perspective.

This enables speeding up the identification of opportunities, and realisation of savings compared with the use of internal resources — delivering tangible savings well within a fiscal year (and sometimes within 6 months).

It does this by enabling the process to be brought up to speed and maintained at that speed without being delayed by other priorities that management might face.

For the sourcing of existing, purchased products, we work toward ensuring that the whole cost of the process is self-financing with a significant payback in the short term.

As an additional benefit, our clients frequently build a knowledge of LCCs that can be utilised for further development of offshore sourcing, and for expansion of sales in these emerging territories.

Our sourcing process usually provides a detailed understanding of competitor activity — delivering very important strategic insights.

We also ensure knowledge of the overall process and best practice techniques is transferred to the customer throughout the sourcing exercise — making it sustainable for the future.

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