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Why we must have PLAN B in purchasing function?

Views : 105
Author : Jeffrey.Yang
Update time : 2021-05-29 18:31:56
What's the plan B of ECOBAGS?
No matter what project you execute now, no matter what company you manage, no matter who you are. When you do something,, you have your original planning, means Plan A,  but to reduce the fail risk, you need to have the plan B

Beause we are in ecobags business, let's discuss by the purchasing of supply chain function.

We know that the major KPIs for purchasing department is including but not limited : Qulaity, On Time and Cost. 
  • Qulaity : If you meet qulaity problem from your current sole supplier, it may affects your products, sales and even more brand repution.  If the qulaity cannot solved in short time,  is to urgently purchase qualified products from your alternative suppliers, this is your Plan B for qulaity problem. 
  • On Time Arrive:When your supplier has inevitable factors (political, natural disasters, etc.) and cannot ensure the delivery period. Your B plan is an emergency purchase from youralternative supplier;
  • Cost Down:As your procurement costs increase, you face challange of company cost reduction indicators; Except negotiate with existing suppliers, your B plan is purchasing from youralternative suppliers with competitive price. 

To summary:  It's necessary to setup  alternative suppliers and do regular assessment.

52ECOBAGS as the professional Paper Bags, Non-woven Bags and Cotton Bags  wholesale suppliler, give our customer Hight quality, Competitive price and On Time Delivery is our Responsibilities and Mission. How to do this? We also have our Plan B. 
  • RM Purchasing : I have to be said that the current supply of the RM market is very tight, the prices are rising and the RM is shortage. Sometimes even you have cash, but still cannot purchase RM. To ensure our customer orders are not affected, we actively communicate with customers for future demand and also comunnication for market price trend, we also implemented our plan B in purchasing RM. We aready  added 4 plus alternative suppliers and  do regularly evaluate suppliers; In year 2021, our alternative suppliers played a key role in our timely delivery;
  • High Sea Freight; It is known to all, due to covid-19, the sea freight is increasing everyday and still very shortage for the space. Current to USA /Canada shipping line, the sea price is up to 14000USD. For not urgent goods, we will recommend customers to delay shipment, but for urgent goods. Our plan B is to share the rising sea freight with customer and  also we  already added 15 forwarders so that we have more chance to get compettive quotation and container space. 
Therefore, to reduce various risks, ECOBAGS'S plan B is also: Alternative Suppliers;

So now we know the importance of Plan B, if you are looking for some backup supplier of ecobags, we are very appreciating to be your Plan B. 

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