HutchinsonMedical Case Study

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UK versus far East supply

Background

Having provided over 1 million components to the medical industry over the past 5 years, we know exactly the tolerances required. Quality is at the heart of everything we do and its no more crucial than in the medical industry. A customer within the medical industry was sub-contracting the majority of their components to the Far East, however they were having quality issues, as well as long lead times, not to mention the capital that was tied up with large minimum order requirements. We wanted to help.

The Issue

The main issue for the company was the fact they required revisions to components, and when purchasing in the Far East the lead time to initiate the new revisions could be up to 16 weeks as there was a large volume of stock in stores, and on the sea. Flexibility is a key requirement in todays market but cost is always an issue. We knew we could deliver the flexibility but could we match the Far East on price, would our location and reduced delivery costs, no import duties and the time savings all factor in to balance the price?

Our Solution

Initially the company was unsure as to the competitiveness that could be achieved by a UK company versus the Far East. Hutchinson Engineering put forward a business case which included competitive part price costs, reduced the minimum order requirements, and most importantly with a higher quality than the far East offering. When the medical customer added the value of this together the cost of UK supply was actually more competitive than the landed cost from the far East. The added bonus was the fact that new revisions could be implemented within 4 weeks, hence allowing designers to be much more reactive to what their customer base required.

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