A-4-Supplier Management

An automotive consisted of thousands of parts such as engine, transmission system, steel frame, and many plastic parts……etc. These parts could not be manufactured by a single company, but hundreds of suppliers.

If a party generates trouble, everybody would be in trouble, good supplier management is really mattering to the project and industry. The major purpose of supplier management is to ensure the product of each supplier could be produced within the required quality specification and cost in time.

As a mold manufacturer, the project of mine contents development of the molds and relevant equipment which required to produce plastic part my customer need. On the other hand, I always had more than 1 project and mold development running. If a new project to be launched, the arrangement was usually started from 2 questions:

  • What is the current in-house capacity and capability??
    • We have our own manufacturing machine (including CNC machining, EDM, wire cut…etc.) and workers. My team needed to ensure the company loading had no too much gap in different time period, and manufactures molds which are appropriate according to company’s capability.
  • What is the time and cost margin of the project??
    • It is an evaluation to see how the project/mold could be proceed, see table below for consideration concept.
There are too much more to be considered before making the decision of taking or leaving the order. We can discuss more in the future post.

The supplier management is all about finding the balance between customer/in-house/supplier/quality/lead time ……etc.

After took the order, I started work with the customer, my team regarding design CAD, drawing, mold specification……etc. I started approaching to the suppliers as well. Generally, I divided suppliers into:

  • Material suppliers
    • Including: steel, hot runner, standard mold components (screw, lifting ring, ejector pin…etc.)
  • Services suppliers
    • Including: mold design, CNC machining, EDM, wire cut…etc.
  • Mold suppliers
    • Other mold manufacturer could provide completed mold.

For in-house manufactured molds. After checked with my team regarding the assistant which required outsource, I started approaching material and services suppliers to fulfill the in-house mold manufacturing requirement.

  • Normally, I could place order for a completed mold part.
    • CNC machining supplier provides manufactured mold steel part (including steel and machining).
  • Sometimes, I could place order to each supplier for their product, and then I get the mold part I need
    • If the mold is too big (such as mold for automotive bumper part) and the steel block is big as well. CNC supplier does not have enough cash flow to cover the steel, then I had to approach steel supplier and place the order. CNC supplier only provides the machining service.

If the molds are decided to be made from outsource, I started approaching the mold suppliers.

  • Normally, I place the order only, the mold would be done the supplier.
  • Sometimes, the mold supplier was also very busy, they may place the order to another mold supplier.
    • One of my mold suppliers place the order to another mold supplier, but my mold supplier did not take his responsibility to supervise his mold supplier to make the mold right. In the end, I took the responsibility to collaborate my team, my supplier, my supplier’s supplier. And finally, I still submitted good sample and mold to my customer. But it was a very terrible experience that I would never want to face again.

Here are 3 suggestions regarding supplier management:

  • Mange your resources according to priority of time and cost margin.
    • Ensure you spend most of resource to work on the most important area, and don’t hesitate to outsource the rest.
  • Do enough survey and research before place order to your supplier, ensure they are on the same boat with you.
  • Do take care of your good suppliers and leave the rest.

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