How a PE-owned consumer goods company concentrated in China across two dozen product categories activated qualified suppliers in Vietnam and India — avoiding ~75% of the cost of opening new foreign offices, and unlocking design and production capabilities its legacy China supply base could not support.
A sizable PE-owned consumer goods company recognized the need to safeguard its supply chain in light of escalating risk concerns. With China home to 30 suppliers across two dozen product categories, the concentration of suppliers in a single country posed a significant threat to the client's ability to operate and fulfill demand should a disruption occur in the region.
The client did have existing staff based in China — a team of 20 individuals performing largely back-office support functions. But the team's capabilities raised real concerns about its ability to qualify, develop, and manage foreign suppliers outside of China. The work was different in kind, not just in geography.
To further complicate matters, the client was unsure which markets were viable for their products and had yet to determine which specific SKUs should be included or prioritized in this diversification program. The strategic ambition was clear; the operational plan was not.
After a comprehensive evaluation of alternatives — leveraging the China team to qualify new suppliers outside of China, establishing new foreign offices in emerging markets, or engaging The ABC Group — the client chose to work with us to develop a turnkey diversification and management strategy tailored to their specific requirements.
Given the client's desire to enter new geographies without capital expenditure while still requiring in-market staff to manage suppliers after onboarding, the client was a strong fit for The ABC Group's Asset-Light Supply Chain Management model — a Supply Chain Management as a Service (SCMaaS) approach that provides clients access to a broad base of shared and scalable staffing resources across multiple foreign countries, delivering immediate in-market support without the cost or commitment of opening and staffing a new foreign office.
Recognizing the client faced significant and meaningful single-country risk, The ABC Group moved quickly to develop and implement a diversification program. We worked closely with key supply chain personnel at the client to identify high-risk and high-potential SKUs, and identified alternative markets leveraging our existing knowledge of manufacturing capabilities and export activity across the region.
Having created a list of targeted SKUs, our firm built a single unified sourcing dashboard linking the client with our staff in Vietnam and India. At this point, The ABC Group's foreign teams began building the business case on behalf of the client with qualified OEM candidates in both markets.
Through the strategic utilization of our overseas teams, the client achieved an immediate boost in credibility when engaging with potential foreign suppliers — setting them apart from less experienced importers lacking an established in-country presence or familiarity with the local market.
This differentiation in a highly competitive market ultimately led to significantly shorter time to market and improved production lead times, as The ABC Group facilitated a direct channel for engaging with critical personnel at potential suppliers — including both management and engineering teams.
Through this process, our firm verified supplier management, production capabilities, certifications, and the client-specific datapoints required by their retail partners. This degree of transparency helped ensure proper fit within the client's supply chain and instilled confidence in these nascent markets, while also signaling to prospective suppliers that the client was serious about building long-term business relationships.
At the conclusion of this qualification process, the client had the opportunity to choose from several prospective production-ready suppliers across both markets. Additionally, by already conducting a comprehensive review of the client's global processes and product lines at the program's inception, ABC's teams in Vietnam and India were fully equipped to provide continuous support for vendor management after onboarding.
By applying an Asset-Light Supply Chain Management model to the challenge of market entry, the client successfully mitigated single-country risk through the onboarding of qualified and production-ready alternative sources in two new markets.
Over the course of the initial diversification program, the client avoided approximately 75% of the costs traditionally associated with opening and staffing new foreign offices — along with foregoing the multi-year setup time that approach would have required to deliver the same outcomes.
As a result, the client achieved a more resilient global supply chain — and did so with greater speed and cost-efficiency than peers who choose a less agile organizational structure. The PE ownership context here is worth naming: the speed-to-outcome and cap-ex avoidance materially compressed the timeline to value creation in a way that supports portfolio-level objectives.
The client achieved a global supply chain that was more resilient to risks — and did so with greater speed and cost-efficiency than peers who chose a less agile organizational structure.
Additionally, the client enjoyed long-term operational advantages — including newfound design and production capabilities that were previously absent from their legacy Chinese supply base. This opened up new avenues for product line expansion, sales, and revenue growth that the original concentrated supply base could not have supported.
To further magnify these benefits, The ABC Group integrated into the client's existing business processes, creating universal SOPs extending across borders for efficient supply chain operations. This meant the client's domestic supply chain team was able to rapidly and fully tap into the benefits of these new markets without a substantial learning curve or operational disruption.
Ultimately, with the adoption of an Asset-Light Supply Chain Management model complete, the client was better positioned for accelerated growth, better positioned to control supply chain expenses, and better positioned to sustain operations in the face of natural disasters, macroeconomic disruption, or geopolitical tension. Capability stays. Cost structure flexes. Strategic optionality is the durable outcome.
A 30-minute working session with one of our principals. Bring the supplier concentration you're worried about and the markets you've been evaluating — we'll give you an honest read on what diversification would actually look like for your business, including timeline, cost, and what's feasible without opening a new foreign office. No RFP process required.