Overview
Company B, a subsidiary of Company A, intends to sell networking accessories along with a new Company B gaming system. They plan to sell these products into the Retail channel worldwide.
Target shipment date: Sept. 1st 20XX
Estimated Annual Volume: 50,000 units
Company A Worldwide Hubs: Dubai, Nashville, Poland, Indian, Brazil
Language Requirements: English, French, German, Italian, Spanish, Portuguese, Dutch, Japanese, Korean, Chinese-Simplified, Chinese-Traditional, Russian
Payment Terms: Net80 (pending negotiation)
Warranty: 2 years
RFQ Requirements and Responses
| Requirement | Response | |
|---|---|---|
| Tooling Changes | Only branded products | UNIT-5500 is embossed with COMPANY K on the router and the current tooling is still being used for other SKUs. We included potential costs to create a new tooling. Any additional changes are pending Company B specifications. |
| Distribution | Make available for shipment in 30 worldwide countries at 8 hubs in 11 local languages. | Company A is allowing COMPANY K to propose a Phase 1 US only launch, Company A believes 70% of forecasted sales will be in the US. For Phase 2 (Worldwide), we are recommending a new router to be launched around March 20XX |
| Inventory | Make available for sale September 1 , 20XX with at least 2 weeks of inventory in the hubs | Qty – Company A to provide 6 month forecast to COMPANY K. – COMPANY K to provide a minimum of 2 weeks of inventory in the hubs Ownership Company A to take responsibility of Company B Finished Goods in Factory, in Transit, and at Hub. Company A also to take responsibility of Company B-specific lead time component purchases. |
| Certification | Make available for shipment in 30 worldwide countries: Regulatory/ENV certification (Required) USB-IF Certification (Recommended) WHQL Certification (Optional) | UNIT-5500 is certified for FCC and CE. For Phase 2 (Worldwide), we are recommending a new router to be launched around March 20XX which will have additional certifications. |
| Retail Packaging | Make retail packaging and documentation for 11 local languages with Company B branding. | Phase 1: English only launch. Phase 2: Worldwide. Company A to provide translated packaging to COMPANY K. Documentation (QIG, Guides, etc.) to be provided by COMPANY K. |
| Support | Local Support Required. | Company A to provide Level 1 and Level 2 tech support in local country. Company A will contact COMPANY K for level 3 support. COMPANY K to provide training to Company A |
| RMA | Supplier shall provide block RMAs to ensure timely and efficient return process. Company A will return defective parts under warranty for full credit with no buy back obligation. Company A will not perform failure verification (Direct Return) Supplier shall perform failure analysis within 48 hours if deemed critical by Company A. Otherwise, failure analysis must be completed in one week. | COMPANY K to support bulk returns from Company A hubs to Rework Factory in China. Shipping costs to and from hub to be paid by COMPANY K Company A has offered a 3rd party testing/sorting facility to “sort” returned units for open/unopened status with opened units being sent to rework factory. Refurb units to be returned to Company A service hubs to act as replacement warranty units. Note: Some initial units must be provided to Company A service hubs at initial launch to serve as replacement units. Est. 50 units each of router and powerline. Defective, unrepairable units to be credited to Company A |
Risk Summary
Technology Risk
Software S
Inventory Risk
6 month float
Returns Risk
Higher Returns? 23%
International Risk
Costs are higher than expected. Returns are higher than expected. WW implementation more difficult and/or expensive than expected.
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