Once the manufacturing costs are broken down, it is easy to see where the savings can be achieved. But some aspects of manufacturing in India adds to the costs that can negate the savings. These need to be identified and quantified in order to arrive at the real savings. The rule of thumb is that for a low weight, high value part, these additional costs are not significant compared to the savings.

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Identified savings could also easily vanish if anything goes wrong in a whole range of areas. It is essential to understand what can go wrong and how serious its impact could be on the cost, quality and delivery performance of the supply chain. We have developed many checklists - based on hands-on experience of supplying parts to UK customers from India. This allows realistic assessment of supplier capabilities.

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And of course, there is more to India than sourcing parts to increase margins. A low cost location that also has low cost engineering skills as well as white-collar skills can become a very important source of competitive advantage. We have a wide network of offices and can can assemble an team of experienced executives to undertake anything from a sourcing project through to joint ventures, acquisitions and green-field setups. (more on outsourcing)

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