Guideline for the Development of Chinese Suppliers

For engineering goods the bought-in part costs represent a big share of theoverall production costs. Facing increasing global competition many Germanengineering companies identify low-cost sourcing from China as one of theremaining levers to reduce costs. But shifting purchasing volume to China requiresin general the development and improvement of new suppliers. In orderto do so what methods do exist? How do they match the specialties inGerman buyer Chinese supplier relationships? And what can be done toboost the results? Based on the state of the art in literature and in concernedcompanies the author Matthias Vodicka analyzes the current approaches andillustrates their strengths and weaknesses regarding their use in China. Anadapted Balanced Scorecard is designed which including the identified driversof success aims for the improvement of the buyer supplier relationshipitself. With this a strategic guideline and an action plan can boost the outcomesfor both parties. This work addresses companies which are (or plan toget) involved in China sourcing activities and those who are generally interestedin the issues occurring for Western companies in China.