For the Purchasing Manager, success in supplier onboarding most often comes down to four important areas:
- ramp-up time
- product quality
- the potential for long-term supplier partnership
For the first two critical aspects of supplier onboarding, i.e. ramp-up time and product quality, please read the first half of this blog, Quick and efficient supplier onboarding, part 1.
The right price
In addition to ramp-up time and product quality discussed in Part 1 of this blog, another critical element on every supplier onboarding checklist is price.
An important part of our NPI process is formed by production decisions which ensure serial production at the right price. Starting from the early-phase product specifications with the customer, our NPI process will find the optimal balance between the production aspects, product quality and price. This enables the right production volumes at the right quality and price.
Over Norrhydro’s long history, we have successfully completed hundreds of compliance processes with industry-leading manufacturers in various fields of application. Based on our track record, our price/quality ratio is quite optimal in relation to the market prices.
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Ongoing supplier partnership
Onboarding a new hydraulic cylinder supplier is not only about ramp-up. More than anything, finding the right supplier is about ongoing smooth deliveries and supplier partnership that continues to support your business in an optimal manner even when your products and needs change, even when you need to migrate to new technologies, such as digital hydraulics or electrification. At Norrhydro, we build our customer relationships to last, as our motto Your Partner in Success suggests. We offer our Partnership Model to all of our customers, and as a result, our customer relationships are long and stable. If you look at 10 of our largest customers, all of these partnerships have lasted over 15 years, some of them as long as we have been around.
Partnership enables flexible delivery options
With the majority of our customers, we agree to maintain a buffer of ready-to-deliver end products, to enable exceptionally fast deliveries. This ensures there is always a predefined number of correct inventory items in stock, should there be a need. This storage may be located at our premises or the customer’s. Consignment stock is also an option. We can also deliver production phase-specific kits which provide pre-grouped sets of cylinders for a specific phase on the customer’s assembly line.
When we make a contract with a new partner, the contract most commonly defines the stocked product items, delivery times and redemption obligations.
Continuous lifecycle management
Ongoing partnership is also about efficiently managing product lifecycles, in seamless cooperation between the supplier and the buyer. At Norrhydro, we take care of our customers, as times and needs change.
As time passes, it may be that the customer needs modifications to specific product items or to the product order and delivery process. Over time, it will be necessary to also ramp down certain delivery items due to changes in the buyer’s product line. In these cases, it is in everyone’s mutual interest to perform a controlled ramp-down, where deliveries continue exactly as long as the need continues. At the same time, the production volume can be gradually cut down based on the predicted volumes. This reduces financial risk for all involved, the buyer, the supplier and the supplier’s supplier, as there will be no costly surplus left in the pipeline.
For change management, we use an electronic change management process for any modifications needed to existing product items. As part of the partnership and our expert role, we may occasionally suggest changes to the products, either to improve the reliability of the product or to optimize the costs.
We also provide our partners with a service for spare parts. In this way, we can support the products in use all the way to the end of the product lifecycle. In some cases, the entire hydraulic cylinder is replaced. In other cases, we will replace hydraulic pipes, rods or hydraulic seals. In some cases, we will even replace individual hydraulic controllers or pistons. This entirely depends on our partner’s needs.
Would you like to know more?
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