Bandages and Dressing Sourcing Project – Case Study

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Bandages and Dressing sourcing project

Case Study © 2021 Dragon Sourcing. All rights reserved.

Agenda

1.

Sourcing Project Introduction

2.

Sourcing Approach

3.

Conclusions

© 2021 Dragon Sourcing. All rights reserved.

2

Objectives and approach Context Client Introduction: • Client with headquarters in USA is a manufacture of world-famous insect bite repellents, first aids, survival products, burn remedy products and others.

Project Objectives: • Identify and recommend new potential competitive supplies manufacturing Bandages and Dressing.

Geographical scope: India and Vietnam Deliverables: • Supplier database • RFI-RFQ template • RFI-RFQ analysis report • Supplier profiles with rankings • DS Recommendation on next steps

© 2021 Dragon Sourcing. All rights reserved.

Dragon Sourcing approach Stage 1: Supplier Pre-Qualification 1. Demand Analysis 2. Supply Market Analysis 3. Telephone Pre-screening 4. Develop RFI/RFQ 5. Administer RFI/RFQ 6. Analyse RFI/RFQ Responses Stage 2: Do the qualification work for the shortlisted bandage suppliers: 1. Auditing the shortlisted suppliers and sample testing in order to select the company to partner with.

2. Investigating all the other first aid kit items to see what could be sourced locally at what costs.

3. Finalising the economics of the deal with the selected/qualified supplier to include all items and the kitting of all the items.

4. Finalising the contract with the selected supplier

- Total 12 SKUs for Bandages and Dressing were selected to run in the RFQ process.

#

1

2

Category

Product picture

Item#

Product name

XX

Bandages 1" x 3"

XX

Knuckle Adhesive Bandages 1-1/2"x3"

Fabric Adhesive Bandage

Premium Elastic Bandage w/SelfClosures

XX

#

Category

5

6

7

3

4

Non-Sterile Conforming Bandage

Non-Woven Triangular Bandage

© 2021 Dragon Sourcing. All rights reserved.

XX

XX

Item#

Product name

Sterile NonAdherent Pads

XX

Non adherent dressing, 3"x4"

Sterile Hydrogel Burn Dressing

XX

Burn Dressing 4"x4"

XX

Nonwoven dressing 2"x2", 4 Ply

XX

Nonwoven dressing 2"x2", 4 Ply

XX

Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply

XX

Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply

XX

Glacier Gel Blister & Burning Dressing (

Elastic Bandage 3” x 5yard Sterile Non-Woven Sponges

Conforming Bandage 3” x 4.1yard

Triangular Bandage

8

Product picture

Gel Blister & Burning Dressing

Agenda

1.

Sourcing Project Introduction

2.

Sourcing Approach

3.

Conclusions

© 2021 Dragon Sourcing. All rights reserved.

5

- Following steps were covered in Stage 1: Supplier Pre-Qualification No. 1.

2.

3.

4.

Steps in stage 1 Demand Analysis Work with client to define and understand the products and requirements (specs, volumes, materials, production technology requirements) Supply Market Analysis Identify long list of potential suppliers in India and Vietnam by leveraging B2B Websites, DS Database, Fair catalogues, Chamber of Commerce, Magazines, Network, References.

Telephone Pre-screening Selection of suppliers to be included in the RFI-RFQ process by telephone pre-screening based on agreed simple criteria (e.g., capability to make the product, minimum company size, quality certifications, interest in participating) Develop RFI/RFQ document Prepare an RFI-RFQ document, with an aligned Balanced Scorecard that has the objective to prequalify the competitiveness and capabilities of the suppliers, including Background, Financials, Client references and Product experience, Quality certification & processes, Social Responsibility, Manufacturing/technology capability, R&D capability

Deliverables • Kick-Off Report

• Supplier list

• Shortlist for RFI-RFQ process

• RFI-RFQ Template

5.

Administer RFI/RFQ: The RFI-RFQ is translated in relevant languages and distributed to the suppliers, with telephone followup to push for maximum participation.

• Complete RFI-RFQ’s

6.

Scoring the suppliers: Work with client to draft a balance score card to evaluate suppliers based on the RFI-RFQ.

• Score card

7.

Analyze RFI/RFQ Responses: Analysis of RFI-RFQ responses and preparation of a report which profiles & objectively ranks the suppliers by capability, including a recommendation for those to be included in the qualification process (auditing and sampling).

• RFI-RFQ Report • Supplier Profiles • Proposed Shortlist for Audit.

© 2021 Dragon Sourcing. All rights reserved.

Ongoing Completed

- Stage 1: Supplier Pre-Qualification timeframe.

- Project completed in 7 weeks as per scheduled

Delayed

Week 0

Week 1

Week 2

Week 3

Week 4

Week 5

Week 6

Week 7

July 15 –16

July 19 –23

July 26 –30

Aug 2--6

Aug 9--13

Aug 16--20

Aug 23--27

Aug 30 – Sept 03

STEPS

1. Demand Analysis

2. Supply Market Analysis

3. Telephone Pre-screening

4. Develop RFI/RFQ

RFI/RFQ validated

5. Administer RFI/RFQ

6. Analyze RFI/RFQ responses & send RFQ report.

•

Supplier profiles with recommendations.

Weekly progress report was sent every Friday Finished

© 2021 Dragon Sourcing. All rights reserved.

Milestones

‒ Extensive supplier data base was built in India and Vietnam leveraging multiple sources of information & from existing DS database.

•

Full sourcing process including building long list of supplier database was done online on the DS e-sourcing tool GSP

© 2021 Dragon Sourcing. All rights reserved.

‒ Pre-screening process was initiated after receiving client validation, ‒ This process was to filter the long list of identified suppliers prior moving them to the RFI-RFQ step

Suppliers “Must have” criteria to pass pre-screening.

•

Full sourcing process including building long list of supplier database was done online on the DS e-sourcing tool GSP

© 2021 Dragon Sourcing. All rights reserved.

Post pre-screening the suppliers, RFI-RFQ process was administered to filter out most capable suppliers.

© 2021 Dragon Sourcing. All rights reserved.

RFI Score

80%

RFI Ranking

1

Post pre-screening the suppliers, RFI-RFQ process was administered to filter out most capable suppliers.

© 2021 Dragon Sourcing. All rights reserved.

‒ Category specific technical questions were added in the RFI to understand supplier production capability and capacity.

© 2021 Dragon Sourcing. All rights reserved.

− Supply market analysis was shared in the weekly progress and final RFQ report.

Process

Supplier Identification (Completed)

Pre-screening Process (Completed)

RFI/RFQ Administration (completed)

Steps

India

Vietnam

Total

• Suppliers identified

62

15

77

• Supplier passed pre-screening

XX

XX

25

• Suppliers failed Pre- screening

XX

XX

52

• Number of RFI/RFQ sent

XX

XX

25

• Don't intend to respond

XX

XX

16

• Number of RFI/RFQ received

XX

XX

9

© 2021 Dragon Sourcing. All rights reserved.

Supplier rejection analysis was shared with client for each step,

Certified with ISO 13485, but not willing to apply for US FDA 15

Traders/distributors or Importers only Not willing to apply for US FDA and not holding ISO 13485 or equivalent certification

12

Producing other items such as medical and surgical instruments, etc..

13 Not interested in direct export or via agent Pre-screening Rejection

Machines are not capable to produce bandages with same/similar dimensions and packaging Producing other type of dressings in cotton only 6 Only producing 1 SKU elastic bandage and their capacity is full for domestic sales Company shutdown for 30 days due to shortage of raw material and lock down RFI/RFQ Rejection © 2021 Dragon Sourcing. All rights reserved.

- Price analysis was shared with the client, #

1

Category

No. of Maximum Saving Maximum Saving Max saving from quotes % in each SKU $ in each SKU supplier received

Item#

Product name

XX

Bandages 1" x 3"

4

41%

$ XX

Supplier 6

India

XX

Knuckle Adhesive Bandages 1-1/2"x3"

8

55%

$ XX

Supplier 3

India

Fabric Adhesive Bandage

Country

2

Premium Elastic Bandage w/Self- Closures

XX

Elastic Bandage 3” x 5yard

5

4%

$ XX

Supplier 1

India

3

Non-Sterile Conforming Bandage

XX

Conforming Bandage 3” x 4.1yard

6

9%

$ XX

Supplier 2

Vietnam

4

Non-Woven Triangular Bandage

XX

Triangular Bandage

7

62%

$ XX

Supplier 2

Vietnam

5

Sterile Non-Adherent Pads

XX

Non adherent dressing, 3"x4"

6

27%

$ XX

Supplier 2

Vietnam

6

Sterile Hydrogel Burn Dressing

XX

Burn Dressing 4"x4"

5

53%

$ XX

Supplier 3

India

XX

Nonwoven dressing 2"x2", 4 Ply

8

57%

$ XX

Supplier 2

Vietnam

8

67%

$ XX

Supplier 2

Vietnam

8

64%

$ XX

Supplier 2

Vietnam

7

70%

$ XX

Supplier 2

Vietnam

2

76%

$ XX

Supplier 1

India

XX 7

Sterile Non-Woven Sponges

XX

XX

8

Gel Blister & Burning Dressing

XX

Nonwoven dressing 2"x2", 4 Ply Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply Glacier Gel Blister & Burning Dressing

$ XX © 2021 Dragon Sourcing. All rights reserved.

Maximum Saving Savings No savings

- Price analysis was shared with the client, - FOB price comparison.

Maximum Saving Savings

Category

1

Fabric Adhesive Bandage

Premium Elastic 2 Bandage w/SelfClosures Non-Sterile 3 Conforming Bandage Non-Woven 4 Triangular Bandage Sterile Non5 Adherent Pads Sterile Hydrogel 6 Burn Dressing

Item # XX

Bandages 1" x 3"

4

$ XX

-XX %

-

-

$ XX

XX %

-

-

-

-

$ XX

-XX %

$ XX

- XX %

-

-

-

-

XX

Knuckle Adhesive Bandages 11/2"x3"

3

$ XX

-XX %

-

-

$ XX

XX %

-

-

-

-

-

-

$ XX

- XX %

-

-

-

-

XX

Elastic Bandage 3” x 5yard

XX

$ XX

-XX %

$ XX

- XX %

-

-

$ XX

-XX %

$ XX

-XX %

-

$ XX

- XX %

$ XX

- XX %

-

-

XX

Conforming Bandage 3” x 4.1yard

XX

$ XX

-XX %

$ XX

- XX %

-

-

-

-

$ XX

-XX %

$ XX

- XX %

$ XX

- XX %

$ XX

- XX %

-

-

XX

Triangular Bandage

XX

$ XX

-XX %

$ XX

- XX %

$ XX

XX %

-

-

$ XX

-XX %

-

-

$ XX

- XX %

$ XX

- XX %

$ XX

- XX %

XX

$ XX

-XX %

$ XX

- XX %

$ XX

-XX %

-

-

$ XX

-XX %

-

-

$ XX

- XX %

-

-

-

-

XX

$ XX

-XX %

-

-

$ XX

- XX %

-

-

-

-

-

-

$ XX

-XX %

-

-

-

-

XX

$ XX

-XX %

$ XX

- XX %

$ XX

XX %

$ XX

-XX %

$ XX

-XX %

-

-

$ XX

- XX %

$ XX

- XX %

$ XX

- XX %

XX

$ XX

-XX %

$ XX

- XX %

$ XX

XX %

$ XX

-XX %

$ XX

-XX %

-

-

$ XX

- XX %

$ XX

- XX %

$ XX

- XX %

XX

$ XX

-XX %

$ XX

- XX %

$ XX

XX %

$ XX

-XX %

$ XX

40%

-

-

$ XX

- XX %

$ XX

- XX %

$ XX

- XX %

XX

$ XX

-XX %

$ XX

- XX %

$ XX

XX %

-

-

$ XX

42%

-

-

$ XX

- XX %

$ XX

- XX %

$ XX

- XX %

2

$ XX

-XX %

-

-

-

-

-

-

-

-

-

-

$ XX

- XX %

-

-

-

-

XX XX XX

XX 7

Sterile NonWoven Sponges

XX

XX

8

Gel Blister & Burning Dressing

Product name

XX

Non adherent dressing, 3"x4" Burn Dressing 4"x4" Nonwoven dressing 2"x2", 4 Ply Nonwoven dressing 2"x2", 4 Ply Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply Glacier Gel Blister & Burning Dressing

CONFIDENTIAL

#

# 1 2 3 4 5 6 7 8 9 Supplier name Supplier 1 Supplier 2 Supplier 3 Supplier 4 Supplier 5 Supplier 6 Supplier 7 Supplier 8 Supplier 9 Country India Vietnam India Vietnam India India India India India No. of SKUs offered 12 8 9 4 8 2 12 7 5 Client No. of FOB FOB FOB FOB FOB FOB FOB FOB FOB buying quotes Diff % Diff % Diff % Diff % Diff % Diff % Diff % Diff % Diff % Price/PC Price/PC Price/PC Price/PC Price/PC Price/PC Price/PC Price/PC Price/PC Price/PC received

Revised offer

© 2021 Dragon Sourcing. All rights reserved.

Target price given and waiting

Not willing to revise

Revised offer

Revised offer

Not willing to revise

Revised offer

Revised offer

Not willing to revise

Maximum Saving Savings No savings

- Spend and saving analysis was shared with the client, Maximum Saving Savings

# Supplier name

1 Supplier 1

2 Supplier 2

3 Supplier 3

4 Supplier 4

5 Supplier 5

6 Supplier 6

7 Supplier 7

8 Supplier 8

9 Supplier 9

No savings

Country No. of SKUs offered Total Savings in $US

India

Vietnam

India

Vietnam

India

India

India

India

India

12

8

9

4

8

2

12

7

5

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

No Savings

No Savings

Client Annual Spend Volumes value

Diff %

Savings in $US

Spend value

Diff %

XX

$ XX

XX %

$ XX

-

-

-

$ XX

XX %

$ XX

Knuckle Adhesive Bandages 1-1/2"x3"

XX

$ XX

XX %

$ XX

-

-

-

$ XX

XX %

XX

Elastic Bandage 3” x 5yard

XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

-

3

XX

Conforming Bandage 3” x 4.1yard

XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

4

XX

Triangular Bandage

XX

$ XX

XX %

$ XX

$ XX

XX %

5

XX

Non adherent dressing, 3"x4"

XX

$ XX

XX %

$ XX

$ XX

6

XX

Burn Dressing 4"x4"

XX

$ XX

XX %

$ XX

XX

Nonwoven dressing 2"x2", 4 Ply

$ XX

XX %

$ XX

Item#

Product name

XX

Bandages 1" x 3"

XX 2

1

7

XX

Nonwoven dressing 2"x2", 4 Ply

XX

Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply

XX

Gauze Sterile, Nonwoven dressing 4"x4", 4 Ply

XX

Glacier Gel Blister & Burning Dressing

XX

CONFIDENTIAL

Spend value

#

Savings Spend in $US value

Diff %

Savings in $US

Spend value

Diff %

Spend value

Diff %

-

-

-

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

-

-

-

-

-

-

-

$ XX

$ XX

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

-

$ XX

-

-

-

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

XX %

$ XX

-

-

-

$ XX

$ XX

$ XX

-

-

XX %

$ XX

$ XX

XX %

$ XX

-

-

-

$ XX

$ XX

$ XX

-

-

-

-

$ XX

XX %

$ XX

-

-

-

-

-

-

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

$ XX

$ XX

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

$ XX

XX %

$ XX

-

-

$ XX

XX %

$ XX

-

-

-

-

-

-

$ XX

Diff %

Savings Spend in $US value

Savings Spend Savings Diff % in $US value in $US

Savings Spend in $US value

Diff %

Spend value

Diff %

-

-

-

-

$ XX

-

-

-

-

$ XX

$ XX

$ XX

$ XX

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

$ XX

$ XX

$ XX

-

-

-

-

-

-

-

$ XX

$ XX

$ XX

-

-

-

-

$ XX

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

$ XX

$ XX

$ XX

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

-

-

-

-

-

-

-

-

$ XX

$ XX

$ XX

-

-

-

-

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

$ XX

XX

8

Total Spend value

XX $ XX

$ XX

$ XX

$ XX

Revised offer

Target price given and waiting

Not willing to revise

1000000

© 2021 Dragon Sourcing. All rights reserved.

Revised offer

Revised offer

Not willing to revise

Revised offer

Revised offer

Not willing to revise

Shortlisted

Could be considered Not shortlisted

© 2021 Dragon Sourcing. All rights reserved.

SUPPLIER 9

SUPPLIER 8

SUPPLIER 7

SUPPLIER 6

SUPPLIER 5

SUPPLIER 4

SUPPLIER 3

SUPPLIER 2

SUPPLIER 1

Suppliers Assessment, - Suppliers were assessed and ranked based on their Company profile,

India Suppliers location was shown on the map.

RFI Scoring

Supplier name

City

Province

80

Supplier 1

XX

Delhi

74

Supplier 2

XX

Punjab

62

Supplier 4

XX

XX

53

Supplier 6

XX

XX

46

Supplier 7

XX

XX

45

Supplier 8

XX

XX

41

Supplier 9

XX

XX

Location of the Suppliers Marked © 2021 Dragon Sourcing. All rights reserved.

Shortlisted Could be considered Not shortlisted

-

Executive summary with key information was shared with the client, RFQ

RFI RFI Score Ranking %

Supplier

Years Number Can offer for % of of Bandages Country export export employ & experi sales ees Dressing ence

Major Producing items

Certification

Willing to # of offer a SKU's Total Offered complete offered Savings same as per medical kit from total in $US client specs 12

FDA certified

Quality management & others

1

80

Supplier 1

India

650

25

100%

Both

Medical disposable & wound care items

Yes, already producing medical kit

XX

XX

Yes

Yes

ISO 9001, ISO 13485, GMP, CE & CDSCO

2

74

Supplier 2

India

70

30

50%

Both

Surgical dressings, bandages, plaster etc

Yes

XX

XX

Yes

Yes

ISO 13485 & GMP

3

66

Supplier 3

Vietnam

726

5

15%

Both

Sterile non woven sponges & dressing

Yes

XX

XX

Yes

Yes

ISO 9001, ISO 13485 & CE

4

62

Supplier 4

India

XX

XX

XX

XX

XX

XX

12

XX

XX

XX

XX

5

59

Supplier 5

Vietnam

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

6

53

Supplier 6

India

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

7

46

Supplier 7

India

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

8

45

Supplier 8

India

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

9

41

Supplier 9

India

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

XX

© 2021 Dragon Sourcing. All rights reserved.

20

Agenda

1.

Sourcing Project Introduction

2.

Sourcing Approach

3.

Conclusions

© 2021 Dragon Sourcing. All rights reserved.

21

Conclusions ✓ Whole project was carried out in 7 weeks with total 77 suppliers identified from India and Vietnam. ✓ All the suppliers responded to the RFI-RFQ process were certified with ISO 13485 & other relevant certifications. ✓ All the shortlisted suppliers were FDA certified. ✓ Savings were achieved from several suppliers with highest saving from Indian supplier based on 12 SKU’s about $ 200K. ✓ Potential savings in each of the SKUs with maximum saving of 76% for item Gel Blister & Burning Dressing. ✓ Overall based on stage 1 report, It helped client to identify potential & price competitive suppliers. ✓ Sampling process was initiated with the recommended suppliers. ✓ A plan was framed to audit the recommended suppliers as a next step post sampling.

** Dragon Sourcing has experienced team for performing Technical and Social Corporate Responsibility (CSR) audit or hybrid model combing both.

© 2021 Dragon Sourcing. All rights reserved.