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Management of manufacturer's factory relocation

发布时间:2015-07-12 点击数:1068

Carl Li audited a shock absorber manufacturer in Mar 2015 for a oversea customer,  which is part of our sourcing and supply chain service.  In the audit report, we highlighted the risk related to the factory move , which is scheduled in May 2015, from Wenzhou to a new factory in AnHui province.  Based on our experience,  factory move has lots of uncertainties as of schedule and quality management, so we proposed the customer to slow down his ramping up and better approve the new factory, then kick off the order and mass production.  We do not follow up this as customer just buy the service for one time audit.

 

In Jun, this customer contacted us again as the manufacturer consistently delays the shipment, even can't commit a formal shipping date for the 2nd and 3rd container products.  Customer asked Carl Li to help them to push the manufacturer.  We did a long phone call with the manufacturer, and got the move is delayed due to government motivation policy changed etc. Finally they gave us a new plan to ship by end of Aug 2015.  Even we do this phone call with the manufacturer for free due to friendship with the customer, when feedback  to the customer, we still highlighted our finding that this Aug schedule is of high risk to delay again. The manufacturer needs close his old factory, send out equipment to refurbish in his supplier site then reinsatll in new plant, test them, hire new operators, train them, set up the supply base in new region etc, It also have quality risk due to production relocation which normally need a PPAP approval again.  So we propose the customer better to consider postpone the shipping schedule or cancel  the order and move to other 2nd source etc.   Now the situation get worse due to the Typhoons impact.

 

We have lots of  factory move management experience as we managed such situations many times when worked in WAI and other MNCs. Anyway the factory location move is very critical, need have a good project schdule with milestone check, pay more attention, and the customer better have  a contingency plan too.

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