| 1.Choosing the Best Suppliers to Maintain Quality Control |
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From the start, SDI has been very selective in choosing suppliers. “Only quality raw material can be used to produce quality lead frames. We demand that copper be processed under tight control to ensure quality.” Now SDI has formed good strategic relationships with suppliers in Europe and Japan.
With the best raw material, SDI insists on full in-house production. “High precision is required for these products. The specification listed by customers allows for a tolerance of no more than 10μm (about 1/8 of the diameter of a human hair); hence, full in-house production is the best way to ensure quality and cost control.”
SDI lead frames used to be produced exactly according to the specifications provided by customers. In order to help customers cut down the time for development and to enhance production efficiency, SDI has begun to offer professional design recommendations during the development process. Due to the positive recognition of SDI’s performance in this area, certain customers now plan to establish a research and development center close to an SDI plant for convenient cooperative work.
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| 2.Actively Lowering Customers’ Cost and Reserving Safety Stock |
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In order to earn customers’ complete understanding and trust, SDI is glad to share all information with them. For example, it offers transparent prices for non-ferrous metals and would never try to profit off of price fluctuations for raw materials. SDI holds nothing back from the customers in terms of information about its production capacity, investment projects and even production cost.
“We understand that customers are concerned with cost, so we will also actively alert them. In the case of recent soaring prices of copper, which would add millions of US dollars to customers’ cost, we offered free samples of alternative materials for customers to test, so that they might have a choice of alternative materials.”
“Aside from cost, what customers are most concerned about is production interruption.” Once when a customer had to make an extra order to SDI due to probable interruption caused by the delay of another supplier. SDI immediately expanded its production capacity by 25% and made a prompt deliver by air to the customer.
Under normal circumstances, it is hard for a factory to expand production on short notice, but SDI almost always reserves an extra 15% to 20% of its capacity beyond customers’ orders. But would that not lower the utilization of our capacity? Though in general manufacturers seek to operate at full capacity, SDI thinks that meeting our customers’ needs is more important.
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| 3.Establishing Local Supply Mechanisms for Global Customers |
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For customers with factories worldwide, SDI provides a considerate service of local supply by establishing distribution warehouses in the places where customers’ factories are located, in order to ensure prompt delivery and uninterrupted production. Currently there are eight warehouses in North America, Mexico, North Africa and Europe.
As for the protection of products during the shipping process, SDI requires strict reliability of package delivery in addition to delivery simulations and tests to ensure that quality remains intact no matter how complex the shipping conditions may be. For example, according to Chen, some shipments to certain customers have to go through Alaska at -40℃ and through scorching equatorial areas. Therefore SDI pays close attention to package protection to make sure nothing happens to products because of changes in the external environment.
Worldwide service is another stress of SDI, because lead frames are a mature industry with a long life cycle requiring lasting relationships that call for long-term maintenance. “SDI expects not only a pure buy-and-sell relationship with its customers, but a friendship from thriving together, because SDI succeeds when customers succeed.”
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