Navigating Supplier Risks in China's Evolving Market
In recent years, Chinese manufacturers have demonstrated remarkable resilience in the face of major disruptions—from the Covid-19 pandemic and Suez Canal blockages to trade conflicts and the current economic slowdown in China. However, as businesses adapt to these challenges, many suppliers are shifting their focus, exploring new opportunities far outside their traditional expertise.
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This presents two key risks to your supply chain:
- Business Scope Change: Your supplier may shift focus, ceasing production of your product.
- Talent Loss: Key personnel may leave, leaving behind a less competent team, which can result in quality issues.
To mitigate these risks, it's essential to maintain regular engagement with your suppliers to stay informed of any potential changes. Additionally, now may be the right time to evaluate your current suppliers’ performance and explore alternative options within China. One proven risk mitigation strategy is to implement a dual or multi-sourcing approach.
Scandic Sourcing: Supplier Search and Evaluation Experts
Since 2006, Scandic Sourcing has helped clients identify and evaluate suppliers in China. Our process begins with an in-depth analysis of your requirements, followed by the development of an ideal supplier search profile. Leveraging our extensive network and research capabilities, we thoroughly scan the market for suppliers capable of meeting your needs.
Through a systematic process of evaluations and audits, we narrow the field to a handful of “best fit” candidates. In most cases, suppliers will meet 70-90% of your requirements, and we work closely with your engineering team to determine which gaps are easiest to address. Joint visits and discussions allow us to select one or two suppliers to produce a sample, after which we conduct final evaluations of work instructions, quality control methods, and overall capabilities.
Why It’s Worth Investing in a New Supplier
Developing a new supplier for your supply chain requires time and resources, but the investment pays off in times of crisis or market shifts. Moreover, it offers the opportunity to enhance your supply chain and improve overall quality.
To learn more about how Scandic Sourcing can help you secure the best suppliers in China, contact us today.
Please contact: sourcing@scandicsourcing.com