Swedes Gained Insight on Sourcing Strategies

On Thursday 10 May the Swedish Chamber of Commerce Shanghai organized a sponsored event featured Swedish-American strategy management consulting firm, Applied Value. 54 members of the Swedish Chamber gathered for the lunch seminar at Le Royal Meridien Hotel in downtown Shanghai.

The speaker, Mr Magnus Ellström Partner at Applied Value has more than 15 years of experience in leading global supply chain engagements for clients in Europe, America and Asia. The Swede shared his outlook on China sourcing, as well as best practices in the sourcing process.

Many see the rising wages in China and conclude that sourcing should be moved abroad. Mr Ellström, however, did not paint as bleak a picture, saying that many current costs can be cut with proper procedures.

He mentioned that many companies came to China from expensive sourcing markets elsewhere, and for many years they have been content with sourcing costs that were well beneath levels in Europe or America. However, as costs are rising there are many possibilities to find better sourcing options without having to move abroad. He gave an example of a supplier that demanded an increase in price of 10%, but after a thorough investigation and negotiation by the customer, the supplier actually agreed to a 16% decrease instead.

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