One of our customers, a leading European furniture and accessories components supplier, came to us in order to optimize their structure in Asia. With offices in Hong Kong, Taiwan and in 2 locations in China, the company felt that through hasty set ups and non efficient handling of the operations, the China entities could be located better, and more cost saved. After auditing the existing operations and receiving a full overview of the current structure and cost of operations, a study was performed for the customer to identify potential cost savings.

The study included the research objectives of:

• Office location costs for consolidated operations: Existing and new locations were investigated, rent, safety, infrastructure, available labour and further details
• Labour: Cost of labour (according to relevant position and function) at the equivalent locations including gross pay and employers contribution.
• Warehousing: Including differences and possibilities of a warehouse in Hong Kong, Free Trade Zones in China, Bonded Zones in China and locations in the heart of China
• Logistics: Cost comparison outsourcing versus own structures
• Company Structure options

After our research, we assisted our customer successfully to close one office in China, outsource the Hong Kong operation cost effectively to Klako, and set up a warehouse operation for direct consolidated shipments to their worldwide customers for China. This improved not only the customer’s cost structure, but also their delivery times and services that they were able to offer to their clients.