Global sourcing reorganization
Reorganization of global supply chain, diversifying away from China
A leading global furniture brand and retailer was confronted with rising production costs, increased tariffs, and shortage of capacity due to a major uptick and demand. The core challenge was to determine how to deal with the shifting trade dynamics in Asia while keeping the supply lines moving. Said differently, how to begin the move away from dependence solely on China for supply while not missing the strong uptick in demand in North America.
Alaris worked with leadership to assess the current state of the organization, including defining the macro trends in trade flows. We conducted a spend analysis providing leadership with visual and dynamic information on the sourcing and procurement history of the firm. Overlaying this information with trade flows, we quantified the supply chain opportunities and challenges. Alaris combined this quantitative intelligence with the qualitative assessment of the people, processes, and technologies in use. Finally, Alaris facilitated discussions with leadership to articulate and agree upon the desired future state.
The trick and indeed the real value creation was clarifying how to bridge the gap from the current to the future state. Alaris led the team to conduct sourcing events designed to identify new sources of supply and update market prices. For the organization redesign, we assessed the capabilities of the current team, developed job descriptions, and hired additional resources. And finally we worked with incumbents to structure relationship to leverage the benefits and mitigate the risks as the supply chain diversified away from China as a sole source of supply.
Diversified supply chain away from China to include more supply from SE Asia and Central and South America
Hired new leadership in Asia and North America to lead the rollout of new systems and processes to improve accuracy and cost of procurement
Secured supply from incumbents