A client came to us with a spring-loaded “Bottle Filler” assembly made up of five different components. They could get it for 80 cents from one of their existing suppliers in Shanghai, but needed the price to be in the 50 to 60-cent range to expand distribution and potentially corner the market.
In our extensive research, of all the suppliers in China that already make this type of assembly, 80 cents per unit was the rock-bottom price. But that’s only if you use traditional means.
By putting each individual component in the assembly through an aggressive cost savings plan, we were able to find better suppliers for the components they didn’t make in-house. The result? We were able to get the price down to 36 cents per unit from the client’s existing supplier.
Additionally, when the client is ready, we’ve already built a plan to cut out the original supplier completely and drop the cost-per-unit to 19 cents.