Ahold, a leading international retail group, partnered with eSourcing Solution to optimize its global sourcing strategy. The objective: reduce procurement costs and streamline supplier management, with a focus on China’s manufacturing ecosystem.
Define the Challenge
Ahold faced escalating raw material costs and inefficiencies scattered across multiple regions. They needed a trusted partner who could uncover high-quality, cost-competitive suppliers in China, while ensuring production reliability and compliance.
Strategy & Approach
Clear Requirement Definition
The eSourcing team worked closely with Ahold to create detailed sourcing profiles, including precise product specs, quality standards (e.g., food-grade and packaging safety), target volumes, and logistics constraints.
Targeted Supplier Search
Leveraging eSourcing’s procurement intelligence platform, the team filtered suppliers by certifications, production capacity, and historical on-time delivery performance.
Thorough Supplier Evaluation
Ahold and eSourcing conducted virtual factory tours and remote audits, validated ISO and food safety certifications, and compared manufacturer vs. trading company offers.
Mitigating Risks
Key warning signs—such as factory images that didn’t align with stated capacity—were flagged early. Suppliers who couldn’t produce sample batches according to spec or whose communication was inconsistent were eliminated, ensuring only reliable partners remained.
Negotiation & Onboarding
Negotiations focused on achievable Minimum Order Quantities (MOQs) and structured payments (e.g., 30% upfront, 70% on delivery). Penalty clauses for quality variance were embedded into contracts, ensuring accountability.
Building Long-Term Relationships
By maintaining clear communication, performing scheduled audits, and rewarding supplier performance, Ahold fostered ongoing partnerships with two high-volume Chinese manufacturers. This collaboration led to prioritized production slots and mutual trust.
Results & Impact
- 15–20% reduction in unit cost, with more predictable supply
- 80% on-time delivery rate, thanks to improved supplier transparency
- Secured dual-certified suppliers (ISO + food safety), ensuring product compliance
- Scalable sourcing strategy now being extended to new product categories and regions
Summary
Ahold’s experience underscores eSourcing Solution’s ability to deliver cost savings, reliable supplier relationships, and process efficiencies—all vital in today’s complex sourcing landscape.