Monthly Archives: May 2013

How to Draft Your Production Schedule with Your China Suppliers

Why do you need to develop a production schedule with your suppliers?

People tend to think that they can be assured of a smooth order process and compliance of delivery and quality when there’s a contract agreed upon, which defines the product, the delivery time and the commercial terms. However, they don’t realize that they need more insights of the production plan with the factory to have better control of their orders.

Chinese factories may or may not have a good planning skills. Some factories don’t plan at all. Some of them put the production on for the customer who yells the loudliest.  They may give you a “leadtime” out of their experience that your order is going to take 30 days and they put it on the paperwork, without even verifying if they can source the material within the timeframe required to enable the leadtime he promises.

You need to help them understand that as a customer you care about a clear plan which gives everybody a full picture of what should happen at what time to ensure the timely delivery of the order.

The production schedule gives the parties involve a tool to deal with changes along the way. For example, if the packaging production task is dependent on the completion of artworks by the customer, then when the customer delays due to a internal interruption, the block of timeslot of the packaging production on the side of the factory then must move along resulting from this delay. Everyone can understands visually the impact of such event.

A well devised production plan give both parties a chance to assess by what means the production can be speeded up. For example by overlapping tasks or by investing more resources. This benefit is most apparent when a bar chart is used.

The production plan let the factory rethink if they are really resourceful to complete the order as promised with the current work load of his equipment, workforce and raw materials. The agreement between the customer and the factory may be altered so a more reasonable commitment is made. This is very important especially in the case where the customer himself needs to commit to his customer.

What should a production schedule look like?

A production schedule serving the purpose of a tool to manage the whole process of the order delivery should demonstrate at least the below elements.

  • Tasks that represent the completion of 100% of the overall project. If any task without which the project can not be completed, the product schedule is not adequate.
  • Start Date and End Date of each task.
  • The ownership of the tasks, which means who is responsible for the complete of a certain task.
  • The inter-relationship among the tasks. Such information defines whether two tasks can move along in parallel, whether one task is dependent on another task.

How to develop a good production schedule

Before you set out to forcing your supplier to comply with your need to develop a production schedule, get him convinced and on board that beyond the contractual terms on quality and delivery, the both of you need to attain a mutual understanding of the components of the project and their timed interrelation to manage the process collaboratively.

Providing a concrete live sample or explain in very plain words of what an idea production plan should like like to your factory. You can also ask him to share his format of “planning” he use to manage his production schedule which is very likely to be too simplistic to serve the purpose of mutual management.

Hold a meeting or exchange rich content emails if the situation doesn’t allow a f2f meeting to list all the tasks required to complete the project. Procurement of outsourced materials and components, Production of key parts in House, Logistics are the three first level decomposition that you can break your order up to. Ask your factory what materials and components are out sourced. What parts of the product are manufactured separately, what are the processing steps of the key components. The logistics section is normally pretty standard and straight forward which you can apply a standard task list to although in some cases additional steps may required for example in China some consumer product may require an official inspection by the China Inspection and Quarantined bureau which may takes up to 5 days.

When you are comfortable that the list of tasks are complete, you will need to figure out the time required for them to be completed one after another. Also you need to find out the interrelationship among the tasks so as to reflect them in the tool or format you are using to visualize them.

Resource for Download

Over the next couple of weeks, we will be posting some example production schedule so our reader can download them to use in the projects or learn about how it is done in practice.

This article is brought to you by Sourcing Spectrum, a China based sourcing agency dedicated to help our client find, develop and manage China sources. Visit our website for more information. www.sourcingspectrum.com

Cosmetic Packaging Sourcing Trade Shows in China

We recently received invitations from some partnering packaging manufacturers to visit their booths in an important trade show for cosmetic products in Shanghai, China Beauty Expo.

http://www.cbebaiwen.com/

As one of the key trade shows for cosmetics industry, China Beauty Expo exhibit finished cosmetic products, materials and packaging. Equally important is the Guangdong Beauty Expo held in March every year in alliance with Cosmos.

There are two other similar tradeshows that are worth noting:

http://www.cosmoprof-asia.com/

This show is annually held in Hong Kong in November. They are holding this year’s fair from Nov 13th to Nov 15th. It is a leading cosmetic fair in Asia and has been around for 17 events.  Packaging is one of their sections.

http://www.cantonbeauty.com/

They work with Cosmoprof and annualy have two events in Guangzhou, China. There were quite a lot of options in plastic packaging and a decent list of glass suppliers too.  They have held 35 events since their establishment.

Visitors to these trade shows will see manufacturers around the country of varying sizes and competence. From our experience, some exhibitors even have their business license discontinued right before the trade show. Some important leading companies may not even attend these trade shows as they don’t think the trades shows will bring them more business or the visitors are their targeted prospects.

With luck you can meet with good potential sources that meet your selection criteria. It will require your due diligence after the trade shows to follow up with them, verify their information or paying them a visit.

Sourcing Spectrum has been helping our clients in sourcing of cosmetic packaging for over 3 years. We would be very happy to share our advice and insights. Visit our website for more information: http://www.sourcingspectrum.com/.

Exhibitors of Canton Fair Express Confidence on Export Market

Chinese export reportedly increase 18.4% over the same period of last year. There’s a very apparent feeling on behalf of the exporters that there’s a significant increase of visitors and potential sales agreements, according to a Sohu reporter.

As shown by the statistics as of the end of the first phase of Canton Fair, the total of visitors totaled 100,000, an increase of 10.5 on the same phase of 2012.

Many export enterprises said that they feel the export demand has bounced back. Since February of 2013 they have received more orders than the previous year. However, there’s still very fierce international competition.

“The supply chain of our industry has been improved.”, said a tablet manufacturer, “More components than before are now purchased locally. This significantly reduce our costs.”.

According some of the exporters interviewed at the trade show, the increase of raw materials has slowed down but the labour cost is still having an annual increase rate of 10%. A electric switch factory from Fujian said, China’s export business can no long rely solely on labour cost advantage but we should invest in equipment and train our workers with more advanced skills.

A bicycle manufacturer from Suzhou spoke about the impact of the currency fluctuation on his business, not long ago the exchange rate was 6.22. It has now dropped to 6.17. His profit was reduced resulting from the depreciation of the USD against CYN the Chinese currency.