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Define sourcing strategy and impact on European supply chain

April 06, 2016 6421 Views


Solectron is a leading global provider of electronics manufacturing and integrated supply chain services. On a contract basis it manufactures, distributes and services a variety of electronics products.

With the recent trend of shifting production to low labor-cost countries, Solectron wanted to quantify the business opportunity of relocating production to Asia or Eastern Europe.

Groenewout supported Solectron in this project for one of their strategic product groups, using a combination of a quantitative (modeling) approach and qualitative analyses. The tradeoff was quantified in a number of predefined Supply Chain scenarios for the main cost drivers Manufacturing, Procurement, Transport & Logistics and Import duties and tax.

This strategic analysis revealed that, depending on customer characteristics, considerable cost savings could be realized by relocating manufacturing base to a low labor-cost region. To repeat this project in the future or expand it to other product groups, Groenewout developed a customized toolbox. This toolbox can also be used to assist in the quotation process for new prospects.