Client Problem

Increasing Chinese costs makes traditionally outsourced manufacturing more expensive. Our client is also looking to diversify its supplier base to other countries and produce in the same currency where they sell worldwide. Vietnam’s currency is linked to the US dollar with both moving in the same direction compared to other currencies, hedging the currency risk.

Our Solution

Vietnam has become one of the major manufacturing hubs in Asia, particularly where many multinational companies outsource steel structures.

Vietnam has several thousand mechanical engineering workshops in two geographical clusters: in and around Hanoi in the north and around Ho Chi Minh City in south Vietnam. They range from small local workshops to large state-owned companies, operating under the brand name, Lilama. Although these latter work under the same brand, each is an independent company and specialise in their own production technology.

Following our proposal, our client requested us to find qualified factories. Together we created a list of requested supplier qualities and competencies and the ideal profile of their workshop. That profile was applied against a number of workshops to determine a shortlist of ten suitable companies. We then visited each of those companies, to benchmark them on various points such as type of machinery, size, export experience, quality, sustainability etc. We offered them the opportunity to respond to the product schematics to verify their capability to manufacture.

After reporting our processes and findings to our client we jointly selected the six most attractive factories to visit. Asian Insiders/FinnSEA Nordesk arranged the visit program and for three days alongside our client, we met again with the companies for further evaluation discussions and audits. Our client offered quote requests to selected companies.

Successful Result

Following this exhaustive process, our client selected two companies with which to continue. Samples were made and accepted and the pilot production started. In working with us and using our Partner Search service, rather than spending 6-12 months randomly visiting workshops around the country, our client saved several months and gained assured long-term partners.