Facing skyrocketing material prices in China, see how CJCHT seizes the chance for better 2017.
How CJCHT maintains competitive strengths as China Manufacturing faces extreme challenges from high cost burdens by prices of skyrocketing raw materials?
(2016 Analysis on Paper Prices for Corrugated Cardboards in China)
Background: 2016 to 2017 is not a smooth transition. New political guidelines, less transparent forecast and skyrocketing materials like the above graph which shows paper packaging cost that rose 75% just in the last 3 months of 2016.
Companies like CJCHT are facing the most difficult business dilemma in front of 2017: Cost-Down or Cost-Up in future forecast on quotations? How to make a winning strategy to guide the business and our partners?
There is no easy answer for that. And CJCHT has been working on sustainability and CJCHT 2.0 for years to implement a more solid and long-term corporate culture to handle various challenges to come in this upending 2016 to 2017 new era.
Here comes to what we have done and achieved for our partners to follow through and work together to tinker the skyrocketing material cost issues in front of us in 2017.
Risks will bring opportunities. We are confident in Saving for Better in 2017 based on our strategies below.
Our Strategies:
1.Plan Ahead to Cost Down:
(1.1) Facing climate and industry changes has become very critical for companies to survive, and shall be seriously addressed by more careful and adequate planning to avoid ever-demanding challenges and cost burdens therefrom.
(1.2) Correct information and big data is KEY to adequate planning for ahead-of-time adjustment of implementation and production, and it’s the most crucial effort that makes CJCHT’s Cost Down strategy so prominent to face recent China and US’s political/environmental changes and sky-rocketing material costs.
(1.3) Based on statistics showing average 75% cost increase on raw materials like paper packaging, rubber and plastics in 3rd and 4th Quarter of 2016 till now, CJCHT is able to control overall cost substantially unchanged and to maintain cost forecast in slightly lower than previous two quarters ahead for reallocation process to take actions.
2.Technology First: Strong technical and implementation team based on Innovation and Technology emphasis is the core in the following CJCHT’s major efforts in climate and industry changes:
(2.1) Redesign to find alternate product solutions;
(2.2) Re-sourcing to find cheaper and competent materials; and
(2.3) Re-allocation of orders based on redesign and new material specs to find better suppliers or factories who can survive and handle challenges; it’s the time to CHANGE FOR BETTER.
3.Flexible and Transparent Purchase: CJCHT have been working on building friendly ECO-Systems based on mutual beneficial business relationships which are deep-rooted with green initiatives and integrities. Those ECO-Systems can establish a solid and endurable Sourcing Pool for low-cost manufacturing and competitive suppliers to come without hurting by lack of materials and skyrocketing costs. The essential part of the ECO-systems is centralized planning ahead and transparent purchase with high integrity requirements in all aspects, ranging from innovation, consolidated purchasing power and sustainability issues, etc.
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