A client came to us with a one-piece bracket design for a sheet metal wall mount, and hoped we could cut supply chain-related costs. Spoiler alert: we did it.
They asked us to start our search in the U.S. first, so we focused on metal factories near the client’s warehouse. This strategy leverages the factory’s own delivery trucks for free shipping on an otherwise heavy and expensive material to ship. The range in prices quoted was from $5.45 to $13.70 with an average of $8.61.
At the same time, we also put the bracket through an aggressive cost reduction process. We noticed that the design was a lot more expensive than it had to be, so initiated a redesign. We turned it into a much easier to manufacture bracket with two pieces instead of one, using thinner gauge steel. The new design used less material, stacked far better for shipping, and increased load capacity. Win-win-win.
If the client had sourced this bracket themselves — the way they wanted to — they would have paid about $7.20 per bracket. Thanks to our Aggressive Cost Reduction process, they are now paying $1.22 out of Shanghai, China from one of our easiest suppliers to work with. And since they go through about 25,000 brackets a year, (and climbing) the savings add up quickly.