Study On Supplier Localization For FDI Companies

More and more international companies are excited and interested in the strength ofChinese raw material (RM) suppliers. On the other hand, FDIs are afraid of making largescale strategic cooperation for fear of the risks from Chinese local suppliers’ poormanagement and quality performance. Nevertheless, localization of raw material supply isimperative. The main purpose of this thesis is to show a flexible management system throughthe analysis of actual cases in foreign companies. Furthermore, supporting and developing thelocal suppliers’ competence continuously is to realize the localization of raw material supply.Firstly, this thesis classifies suppliers according to the supplier’s performance evaluationto avoid "one size fits all" management mode. It purposes the ideas of changing the thinkinghabit of neglecting the local suppliers’ problems such as weak management foundation,weakness of quality awareness and lack of knowledge. It helps company to achieve a betterdistribution of resource and time based on local suppliers’ practical situation to avoidimpacting RM suppliers’ localization.Secondly, this thesis introduces to develop and manage suppliers’ localization andquality for “win-win” goal in FDIs by traditional methods of diagnosis: observation, listening,interrogation, and pulse-taking. It purposes to help and monitor supplier improvementpatiently with Global support.“Tailor-made” suggestions are necessary and required tosupport poor-performance suppliers which are lack of creative thinking and managementtools.Thirdly, there are many different categories for the supplier’s quality managementbecause of different purposes, such as supplier introduction, supplier daily management,complain management and supplier development. This leads to different integrationapplication for management method and monitor mode to realize company’s requirementwith the supplier cooperation.Finally, an information database is created to monitor the quality status of raw materialsupply preventively. It helps to share quality information to local suppliers timely and givetechnical support to ensure company raw material supply system’s security and stability.In conclusion,“cheaper and faster can still be better” is the target of supplier qualitymanagement on local raw material suppliers.