Case Studies

Featured Case

Establishment of Chinese Manufacturing Plant

Key Takeaway:
U.S. Multinational needed to establish a Chinese plant to remain competitive and retain customer base for those Western customers with an Asian Pacific presence.

Background:
Western Manufacturer of automotive replacement parts serviced the China/Asia Pacific market by exporting from its U.S. and European operations. The Company's China-based customers were Western companies with Chinese plants, and some local domestic Chinese companies. The manufacturer serviced the China market for approximately 9 years and had positive sales projections for the foreseeable future.

Challenge:
The Company was under pressure from its China-based customers to provide on-time delivery and great cost efficiency as well as eliminate Chinese import duties and tariffs.

The Company had two options:
  1. Establish a manufacturing plant
  2. Acquire a Chinese company.
Solution:
East West Associates (EWA) provided a strategic evaluation leading the Company to open its first Chinese manufacturing plant.

Having established more than 22 manufacturing plants in China, EWA was able to leverage our experience to support the Company's efforts to develop a comprehensive Business Plan, Project Management Plan and Project Execution.

Responsibilities included, but were not limited to the following:
  • Worked with the senior executives and Board of Directors as the China Operational experts
  • Developed an in depth Business Plan that included site, start-up and operational costs
  • Qualified 11 sites within identified cost perimeters
  • Visited and evaluated the sites, culling to 3 for senior executive selection.
  • Developed and executed a comprehensive Project Management Plan that addressed all areas of operations: Human Resources, Business Formation, Environmental Health & Safety, Plant Security, Supply Chain and Procurement, Quality Control, Manufacturing Operations, Facility/Utilities, Information Technology, Finance & Accounting, Operational Procedures, Sales & Marketing and Intellectual Property Strategy
  • Identified renovation and fit-up contractors
  • Coordinated the set-up of the manufacturing operations
  • Finalized negotiations with the government officials, business park representatives and building owner for preferential consideration in lease price, lease lengths, building security upgrades, HVAC provision and obtained all government approvals (fire bureau, environmental protection bureau and others)
Result:
The Company's manufacturing plant was successfully established on time and within budget in Ningbo, China.


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