Started in 1996 as a CFL and ceiling fixture manufacturer in China, Opple Lighting has expanded its business into electrical appliances and large-scale commercial lighting solutions, and is now also planning to manufacture in India. Sneha Ambastha from Electronics Bazaar spoke to Avinash Goel, head, technical and sourcing, Opple Lighting, to understand the company’s purchase and procurement requirements.
EB. How important is it for your business to source the correct components from the right vendor? What is the business impact of not doing so?
Sourcing the correct components from the right vendor is as important as having a good quality product. Without good components, good quality lighting products are not possible. Not sourcing the right components can have an adverse effect on business in the long term.
EB. Do you have any special programmes for ‘Made in India’ suppliers or MSMEs?
As we are growing, we do have plans to make in India, based on local requirements and government initiatives (tenders).
EB. Any plans to invest in capital equipment in the coming year, with regard to electronics manufacturing?
We are growing rapidly and our major focus is on sales and marketing. As we grow, we will certainly invest in local resources.
EB. Which are the types of electronic components that you procure?
We procure electronic components to manufacture LED lighting solutions. This includes LEDs, PCBs, resistors, capacitors, etc.
EB. Do you follow any specific process to let suppliers know about your company’s requirements?
Yes, with suppliers, we do share the requirements related to the specifications, quality and the manufacturing process of the components.
EB. Do you have any specific turnover or quality certification requirements for your vendors? And is there any definite process that you follow prior to signing on with a vendor?
There is a complete process for vendor approval. This includes an audit of the vendor’s technical knowhow, manufacturing capabilities, quality management systems, supply chain and financial strength.
EB. How do you classify and define potential, approved and preferred suppliers?
We have a vendor rating system, in which we give the ratings based on technical knowhow, manufacturing capabilities, quality management systems, supply chain and financial strength.
EB. Do you have any vendor development programme? Please elaborate.
We need to develop vendors for new processes/manufacturing techniques or special quality requirements. In such cases, we provide all the technical support related to the product, process and quality requirements. Also, we impart training to key persons from the vendor’s unit, who are involved in the production and quality processes.
EB. What are the typical ‘hard-to-find’ categories for which you feel vendor development is a challenge?
As such we do not face any challenge in vendor development except in the case of ICs, for which there are very few companies that offer economical, yet good quality products.
EB. How do you find a suitable alternative for a failed (end-of-life) component?
Since we use very good quality components with stringent quality parameters, normally we do not face this type of issue. Also as a practice, we make a provision for alternate components and alternate suppliers from the very beginning of product development.
EB. How do you find a suitable alternative to a component supplier who fails due to bankruptcy or other business pressures?
Normally it doesn’t happen, due to our stringent vendor selection process.
At the product development stage we ensure that, for all critical components, we should have more than one supplier. In case we face any problems with a supplier (related to finance, supply or quality), we switch to the next one on our list and begin the vendor development process with that firm.
EB. How does your company respond when low-profit or low sale product lines are closed by suppliers, resulting in no further customer support being offered by them?
Actually speaking, product line closures do not happen overnight. Since we use components in our products, a component’s sale/profit sale/profit will depend on the sales of our lighting product. If the final product sells well, obviously the sales/profits for the components that go into that product, will also be good.
EB. How do you combat the counterfeit or grey market?
Normally it doesn’t happen. But having said that, we follow stringent quality standards and all incoming material goes through quality tests.
