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Sourcing in Asia

Distributors and industrial companies that have so far procured products of Asian origin via intermediaries in Europe should check whether direct procurement from East Asian suppliers is an option for them. INVERTO provides support based on a TCO analysis (“Total Cost of Ownership”) of the previous procurement model. If it makes sense to involve Asian suppliers, we advise and support you in the selection and qualification of suitable suppliers.

Our experts at the Shanghai location are familiar with the conditions in Asia, know the procurement markets and support you in establishing successful supplier relationships.

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Special challenges of supplier management in Asia

When sourcing in China, India, Bangladesh or their neighbouring countries, for all the advantages these countries offer, there are also some special features that European clients should be prepared for. For example, East Asian procurement markets are characterised by volatility and speed. Processes at suppliers sometimes change without the customers being informed. The result is changes in quality or delivery conditions. Another challenge is different cultures and thus a different understanding of processes and liabilities. This can lead to requirements being misunderstood. This is the experience of both trading and manufacturing companies.

In addition, legislation in China is constantly evolving. In recent years, for example, new environmental laws have led to Chinese suppliers having to close down and only being allowed to reopen after an audit in which compliance with the new rules was checked. In some cases, the closures came as a surprise even to the companies concerned, so that European customers could not be informed in time about the resulting delivery failures.

The product is decisive for the right approach

Basically, the degree of product complexity is decisive for the course of action. In the case of technically trivial products with a low quality risk, it is sufficient to define production and quality standards at the beginning, which the supplier bindingly agrees to comply with. In the case of complex products with a high degree of technological added value, however, it is necessary to accompany the suppliers continuously and, if necessary, to intervene in a controlling manner.

This applies all the more when sustainability criteria are involved in production. Since it can be assumed that European companies will be legally obliged to comply with and monitor human rights and environmental standards, companies should address risks in the supply chain at an early stage. Buyers should develop criteria and standards and support their suppliers in setting up appropriate structures in this regard as well.

Trusting partnership through cultural understanding

When communicating with suppliers in Asian countries, it is important to use experts who also know the respective cultural framework conditions. Only then can a trusting and long-term partnership be established that guarantees sustainable quality.

Thanks to many years of experience with sourcing activities in East and Southeast Asia and our location in Shanghai, we have trustworthy contacts. Our Chinese employees, in turn, know the needs of European customers and support our project teams very reliably.

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    Maryne Lemvik, CEO Skanem AS

    „In an interactive sales training with a high degree of practical relevance, our sales staff learned how to approach negotiations like buyers. This change of perspective has decisively changed our sales negotiations. Thanks to INVERTO, our employees now feel better prepared and can draw on professional methods and tactics to achieve better negotiation results - a decisive step in the further development of our sales.“

    Ole Anton Gulsvik, CEO, Seven Seas

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    Patrick Juhl, Head of Procurement, Seven Seas

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    Thomas Pfeiffer, Head of Product Development at

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    Dr. Jürgen Wickl, Managing Director of Styria Media IT

    „By preparing a functional specification, we managed to advertise requirements in a tailored way. INVERTO’s orientation towards precise customer requirements and benchmarks as well as professional negotiations has contributed significantly to the success of this project. The close involvement of employees in this structured tender process is an additional bonus, and something which will benefit us in years to come.“

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    Siniša Mitrović, mag.oec., Managing director, Styria Tiskara Zagreb

    „Due to the flexibility of the team, we managed to receive additional offers from suppliers and hence increase competition between existing suppliers. Through centralization of our former pick-up locations in Croatia and Bosnia-Herzegovina we managed to reduce the operational work for our employees. Furthermore, this centralization led to a huge additional revenue from our waste paper business. The project work with INVERTO was very professional and made this great result possible.“

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    Marc Lamure, Director, Montagu Private Equity Associates LLP

    „INVERTO has helped D.O.R.C. with the professionalization of the procurement organization and accompanied the supplier negotiations for various products and services. By implementing new processes and working with procurement staff, the achieved savings enhance sustainability and will result in a more profitable organization.“

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    Erwan Quemener, Purchasing Director, Chassis Brakes International

    „INVERTO helped us in raising undreamed-of sources of savings in both direct material and indirect material areas. They did not only identify these potentials but they supported us in the implementation phase with a great professionalism.“

    Nick Gerrard, CFO, MID Essex Hospital Services NHS Trust

    „INVERTO’s market and product knowledge have been invaluable in helping the Trust deliver substantial cost savings in a short space of time. They have the ability to talk the clinicians language, optimise the procurement process and deliver a result the trust could not have achieved itself.“

    Bart Stubbe, Vice President of Purchasing LINPAC Group

    „INVERTO are assisting LINPAC since early 2008 in transitioning from a decentralised to a category purchasing structure, bringing sourcing expertise, skilled resources, technology and methodology to recognise, create and release value to the company.“

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