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Exhibitions, Courses, Conferences and Training
News Release from: Subcon
Edited by the Electronicstalk Editorial
Team on 16 March 2007
Masterclass to illustrate offshore
successes
Lambda Europe will explain how it has succeeded in sourcing from China in a special masterclass presentation at Subcon 2007 on Wednesday 2nd May.
Lambda Europe, a subsidiary of TDK and one of the world's leading manufacturers of switched mode power supplies, is one of the true pioneers of sourcing from China It took its first steps 15 years ago sending out kits from the UK for assembly - and for the last eight years has been using suppliers with full manufacturing responsibility
This article was originally published on Electronicstalk on 8 Nov 2004 at 8.00am (UK)
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The story of its success and the lessons it learnt on the way will be the subject of a special masterclass presentation at Subcon 2007 on Wednesday 2nd May.
As the seminar presenter Richard Kenshole of Lambda explains: "You can't just push it to China and hope for the best".
Lambda's approach includes a strong element of supplier development - with training in lean techniques and six sigma, quality, quarterly reviews of costs, and a continuous improvement programme on processes and labour times.
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"We have now been working with two of the companies for eight years and one of them is a leading supplier in China - it is a very good partnership".
"A lot of our suppliers are reaping the benefits of the improvements we have helped them put in place and gaining work from other European companies".
China represents just one aspect of Lambda's sourcing; it also uses UK suppliers and plans to expand its own manufacturing facility in Ilfracombe.
One of the important factors in making sourcing from China effective has been a robust make or buy strategy.
"If you can make it as cost-effectively in the UK as it could be made in China then you should", adds Kenshole.
"We have very strict criteria on make or buy".
"On some of our products we can show, for example, that if it takes more than 20 minutes to make it should go to China, and if it takes less it should stay here because when you add in the China overhead you wipe out the cheaper labour cost right away".
The other element of the make or buy strategy is how Lambda manages the life cycle of a product.
During the introduction phase when modifications are being made and the processes are being optimised the work is done in the UK.
Once the product is defined and the processes are robust the work goes to China.
Finally, end-of-life production comes back to the UK where it can be more effectively managed.
Lambda also puts safeguards in place to make sure it has a fallback option if anything goes wrong.
"Too many companies have sent all their work to China without any contingency plan - what if it goes wrong and you need to make it in the UK?".
"We have the capability in the UK to make the parts if there is any kind of problem".
"It is only a skeleton line, but if there is any delay to the boat, or the parts are held up in customs we know we can make 50 here rather than going to the expense of flying them in".
Overall, says Kenshole, outsourcing to China has been very positive for Lambda.
"Once we found the right companies to deal with we have had a very good working relationship with them".
"Because of the work we have done in the background, the quality we are getting out of China is much higher than we ever imagined - and we are giving them more and more complex work too". Request free introductory details about products from Subcon ...
Subcon, the international show for buyers of contract manufacturing services, takes place from 1st to 3rd May 2007 at the UK NEC, Birmingham, and covers everything from machined parts, electronic assemblies, castings, plastic mouldings and metal fabrications,.
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