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I & J Trading in partnership with Samduk Tongsang CO., LTD specializes in OEM/ODM to satisfy all levels of costumer demands through a thorough observance.

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Presentation on theme: "I & J Trading in partnership with Samduk Tongsang CO., LTD specializes in OEM/ODM to satisfy all levels of costumer demands through a thorough observance."— Presentation transcript:

1 I & J Trading in partnership with Samduk Tongsang CO., LTD specializes in OEM/ODM to satisfy all levels of costumer demands through a thorough observance of deadlines and outstanding quality control. I & J Trading Company and Samduk Tongsan’s Partnership and Strategy for Innovative Production in Outsourcing Topper

2 INDEX

3 PUSAN MAIN FACTORYEXTERNAL FACTORY PUSAN, KOREAKOREAN INDUSTRIAL COMPLEX NameSAMDUK TONGSANG CO., LTD.SAMDUK STAFILD CO., LTD. Employees Management : 80 Production : 100PERSONS Management : 20PERSONS Production : 2,700PERSONS Scale Land : 6,600 m 2 Structure : 5,600 m 2 Land : 26,400 m 2 Structure : 20,000 m 2 Production Capacity ASSEMBLY : 75,000PRS/MONTH SEWING : 200,000PRS/MONTH ASSEMBLY : 130,000PRS/MONTH Item Casual Shoes, Semi Athletic/Athletic Shoes, Walking Shoes, Sports Shoes, Safety Shoes, Trekking Function Shoes, Military Boots, Law Enforcement Footwear, Utility Boots, Hiking Boots,

4 FACTORY PRESIDENT Vice President Planning & Coordination Executives Production/Planning Q.C Management R&D Institute Marketing MANAGEMENT DEPT. Production Team Management Team Quality Team (Inspection, Quality) Quality Team (Inspection, Quality) Management (Planning) Management (Planning) Research Team (Analysis) Tailoring Team Tailoring Team Sewing Team Sewing Team Manufacture Team (Preparation) Manufacture Team (Preparation) Technology Team (Press) Technology Team (Press) Tailoring Team Tailoring Team Materials

5 1999. OCT Superb Small Businessmen Award(Exports) NOV 36 th Trade Day, 5 Million Dollars Exports award NOV37 th Trade Day, 10 Million Dollars Exports award DEC ISO 14001(Environmental Management System Certification) APR Appointed as a Quality Assured Company, Achieved the ‘Q’ Mark OCT Presidential Award (Industrial Technology Development Merit) JUN INNO-BIZ Certification OCT Establishment of Samduk Tongsang’s Research Institute NOV 2 nd External Industrial Complex relocated after expansion JUL Appointed as a Venture Firm (Technology Rating Star Company) SEP  CERTTIFIED AND AWARDED (IMS) NOV New Art of Shoe Technology Competition – Grand Prize in Functionality SEP  CERTIFICATED BEST HRD SEP  AWARDED FIRST S-OJT SEP  SET UP EXT. FACTORY IN INDONESIA

6 We are manufacturing/supplying products under OEM/ODM manufacturing alliances with numerous firms such as NEW BALANCE, OTB FOOTWEAR, PRO-SPECS, ASICS, K2, Z- COIL, and CHUNG-SI. Not only high-functionality sports, lifestyle and casual footwear icorporating Gore-tex technology, but also military and industrial/utility footwear. We manufacture/supply high quality products with R&D Technology as our base. We strive to reduce overhead and supplementary costs and to meet production and delivery deadlines. OEM ODM

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8 OTB ABYSS Boots were designed and engineered at the request of the U.S. Navy SEALS. A maritime boot for use in any rocky or muddy situation, the sole unit also works well in dry conditions. With its superior fit and drainage features this boot also works great with a pair of waders. M AIN P RODUCT : OTB BOOTS

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10 PARTSCOL 1THICKNESSMATERIALS BACK WEBBING REINF,BLK NY 210D/A+ADHESIVE(W/12MM) TONGUE REINF," " TOE BOX REINF," CAMBRELLA+ADHESIVE(W/23M/M) EYELET OVERLAYBLK 1 COLOR WEBBING TAPE(W/12MM) COLLAR TAPE" 1 COLOR WEBBING TAPE(W/35MM) HEEL TAPE" 1 COLOR WEBBING TAPE(W/20MM) EYELET TOP" INJECTED NYLON 66 (HOOK) EYELET BOTTOM" INJECTED NYLON 66(ROUND SHAPE) VAMP MEDIAL PATCH" synthetic leather(toppicol) TONGUE LOGOBLK 1 COLOR EMBROIDERY EYESTAY(LATERAL)LOGO --- HEAT PRESS THREAD NY 210D/4P ZIGZAG THREAD --- P 30S/4P ARIANCE THREADBLK NY840D/4P SHOE LACEBLK 1 COLOR (NEW ROUND LACE) INSOLEBLK GUAGE MESH+CUP INSOLE INSOLE LOGOWHT HEAT TRANSFER INSOLE BOARD --- JV170 PG-031H FROM J&V MIDSOLEBLK 1 COLOR PHYLON M/SOLE(HARDNESS:63+-2) OUTSOLEBLK 1 COLOR RUB SOLE(sticky) SIZE LABEL WHT HEAT TRANSFER

11 Production Capacity Busan : Land 6,600 m 2, Structure 5,600 m 2, 2 manufacture lines(75,000pairs/m) Total Number of workers 185 ( 50 management, 35 R&D, Production 100) R&D Samduk Research Institute : Within Samduk Tongsang CO., LTD. (Officially Approved) PATTERN, PRE-PRODUCTION, PU SCREEN, NO SEWING, ETC TOTAL 35PERSONS ADDVANTAGE HIGH LEVEL OF TECHNICAL WITH USE IN GORE-TEX & OUTDOOR CAD/CAM PU SCREEN/HIGH FREQUCNCY/NO/SEWING FACILITIES IN R&D A/S SYSTEM FOCUSING ON Q.C

12 Samduk(Busan) Buyer Order Placed(Order sheet) Order sheet placed Delivery Delivery after fixation Depending on difficulty and time constraints, direct production/delivery Shipment Purchase domestic subsidiary materials Sorting/Inspection/ Sampling/transferring 1. Subsidiary Materials Stocked 2. Prototypes created (Dyed, processed) 3. Partly-manufactured Goods Stocked 4. Processing/Needlework/Completion 5. Quality Management/Sampling/ Packaging/ By establishing a collaboration of factories, an in house production system and a dramatic reduction of distribution terms are achieved Transportation to External Factory for A/S purposes only takes 1 day By establishing a collaboration of factories, an in house production system and a dramatic reduction of distribution terms are achieved Transportation to External Factory for A/S purposes only takes 1 day ONE STOP TOTAL ONE STOP TOTAL A/S request Samduk(External Factory)

13 We are the proud producer of Gore-tex. As a licensed factory we strive for excellence in all areas of footwear production. We will continue to improve Gore-tex with utmost attention to detail new application of emerging technology. We are the proud producer of Gore-tex. As a licensed factory we strive for excellence in all areas of footwear production. We will continue to improve Gore-tex with utmost attention to detail new application of emerging technology.

14 PersonsEquipment CAPA( 月 ) Cutting ,000 Saw105022lines200,000 Prepare ,000 Press ,000 PersonsEquipment CAPA( 月 ) Pyron ,000 Prepare2504lines200,000 Make2504lines130,000 ETC290 FROM RAW MATERIAL, CUTTING TO ASSEMBLY, In-House System

15 PROCESSFACILITYQ’TIESCAPA/DAYHOUR/DAYPERSONS EXAMNINAT ION LEATHER METER15,00084 TEXTILE METER15,00084 CUTTING OIL PRESSURE MACHINE 758, TOTAL77160 PROCESSFACILITYQ’TIES CAPA/DAYHOUR/DAYPERSONS LINE PREPARATION LINE48, ASSEMBLY LINE45, TOTAL8500  ASSEMBLY & PREPARATION FOR ASSEMBLY  CUTTING

16 PROCESSFACILITYQ’TIESCAPA/DAYHOUR/DAYPERSONS SEWING LINE2 8, MACHINE650 STRAWBELL GATHERING36, MACHINE147,00020 EYELET D-RING115, AUTO RIVET105,000 AUTO D-RING42,000 INNER SOCKER SEAMSEALING62, TESTER22,000 SEW. MACHINE202,000 PARTS HOT MELT6014 MAMMER30 MOLDING(C/H)10 COMPUTER(G)4 30 COMPUTER(N)30 TOTAL  SEWING

17 PROCESSFACILITYQ’TIESCAPA/DAYHOUR/DAYPERSONS EMBROIDERYMACHINE25, HIGH FREQENCY CUT.PRESS(G)4 5, CUT. H.FRE WINSEAL NO SEWING PRESS105,00026 HOT MELTPRESS MACHINE28,50014 SCREEN20M TABLE65,00029 SHARPENINGMACHINE248,50043 TOTAL99250  PREPARATION FOR SEWING

18 PROCESSFACILITYQ’TIESCAPA/DAYHOUR/DAYPERSONS ROLLER KNEADER215, CALENDER1 MIXING ROLLER315,000 CUTTING512,000 PRESS OIL PRESSURE4412, AUTO CUTITNG23,000 TRIMMINGMACHINE1612,00090 BUFFINGGRINDER2012,00060 TOTAL95370  PRESS

19 PROCESSFACILITYQ’TIESCAPA/DAYHOUR/DAYPERSONS PRESSOIL PRESSURE(H/C)163, UV UV LINE18,500 UV MACHINE2 COOLING MAC.1 TOLUENE WASH WASHER15,000 DRYER15,000 TRIMMING107,000 TOTAL3180  PHYLONE MIDSOLE

20 PROCESSFACILITYCAPA/DAYHOUR/DAYPERSONS MODELMACHINE5SET87  MODEL, PATERN, FRAME FACILITYQ’TIES SUN LAMP TESTER1 FORCE CONVECTION OVEN1 WASH TESTER1 UNIVERSAL WEAR TESTER1 DIGITAL BURSTING STERNGTH TESTER1 DENSIMERTER / MD300S1 SHOE FLEXING TESTER1 NBS ABRASION TESTER1 UNIVERSAL TENSILE STRENGTH TESTER 1 TIME SLICE TESTER1 CROCK METER1  LAB.

21 SHORT TERM BASE : SET UP WITHIN DEC INSOLE : 200,000PRS/MONTH IP MIDSOLE : 120,000PRS/MONTH SHORT TERM BASE : SET UP WITHIN DEC INSOLE : 200,000PRS/MONTH IP MIDSOLE : 120,000PRS/MONTH 99% IN HOUSE SYSTEM CUTTING SEWING DECORATION (PU SCREEN, HIGH FREQUENCYNO SEWING, TPR,) INSOLE MIDSOLE OUTSOLE ASSEMBLY MIDDLE TERM BASE : SEP UP WITHIN MAR HO-SKIN : 120,000PRS/MONTH TPR : 100,000PRS/MONTH MIDDLE TERM BASE : SEP UP WITHIN MAR HO-SKIN : 120,000PRS/MONTH TPR : 100,000PRS/MONTH PRODUCTS COMPETITIVE POWER AND TECHNIQUE COMPETITIVE POWER

22  Tianjin, China Factory PROCESSFACILITYQ’TIESCAPA/DAYHOUR/DAYPERSONS SEWINGLINE41,

23 Each year, Samduk’s quality and productivity increases through continuous quality control and educational training. High level intensive management training courses are provided and attendance required by all levels of management

24 Establish a strategic manufacturing system for a more stabilized and efficient production Manufacture Manufacturing in External Factories Sewing Supply for Domestic Demand as a base Maximum 900,000pairs/year Maximum 2,400,000pairs/year Maximum 1,500,000 Pairs/Year

25 Creation of a prepared Manufacture infrastructure for Outsourcing Production Moral Management ▶ ① Employment practice ② Human Rights ③ Environmental Pollution ④ Corruption Determent ⑤ Moral Responsibilities Operation Research Team ▶ Process Analysis, Manufacture Quality Research Technical Support Team ▶ Standards, Technical Support, R&D A/S : Quality Control and Costumer Satisfaction achieved through operating A/S Centers. Establishment of a Gore-tex shoemaking system External Factory Line : Establishment of a manufacturing line for Skechers Establishment one of the world’s best environmental management system

26 Existing Situation Limitations are created as products are produced domestically or produced abroad Utilizing Busan HQ Factory Utilizing External Factory + Country of Origin Problem Solved (100% Made in Korea) Country of Origin Problem Solved (100% Made in Korea) - Delivery Term Reduced - Stabilized distribution system achieved - Delivery Term Reduced - Stabilized distribution system achieved - Cost Competitiveness - Exclusive manufacturing System created Contributes to reputation of high quality and reliability by acquiring Quality Products and Delivery priority using brand’s Exclusive Manufacturing Lines Using Cost Reduction as a foundation, a strategic viewpoint can be implemented through securing core capabilities and competitive superiority. Effect

27 ClassificationCompany ACompany BCompany CSamduk In House system Sewing (Semi- manufactured products) OutsourcingChina / VietnamOutsourcingExt. Factory Shoemaking (Complete Products) BusanChina / VietnamOutsourcingBusan, Ext. Factory Materials and partial processing Outsourcing External Factory Quality of Labor ProsHigh QualityAverage High Quality Cons Wages burden, rapid aging of labor force. Frequent job changes, wage raises, Quality Competitiveness deterioration immeasurableStabilized employment Prime Cost Competitivenes s Relatively LowAverage High Quality PriceReasoning 1. All processes beside completion is done through outsourcing 1. Can’t label as Made in Korea as the product is completed abroad 1. Lack of management due to a lack of an In- house System 1. In House System – Price competitiveness 2. Limitations on domestic production 2. Deindustrialization occurs even Locally, 2. Limitations of Outsourcing Production 2. Stabilized production through Salary Caps (less than 5%) and the fact that it is impossible to change jobs 3. When an outsourcing problem occurs, there isn’t a countermeasure 3. Impossible to reduce delivery term 3. Lack of a sense of ownership (Responsibility ) 3. Through non-price competitiveness, extra competitiveness expected (Delivery, origin of production)

28 Distribution Period, including customs procedures, takes only 1 day (24Hours) Containers 3times/week Delivery Service 6times/week EX) Departure from Ext. Factory at 2pm → Arrival at a distribution center in Seoul at 4pm High-difficulty products or products that are tight on schedule are processed at the head office (Same Price Applied) China (and other Southeast Asian Countries) Excessive Distribution Term Excessive Distribution Term Wages are on a rising Trend Wages are on a rising Trend Korea ↔ China Total Delivery Date : 25~40 Days Busan ↔ External Factory I & J Trading Company and its partner Samduk’s business philosophy is to fulfill customer satisfaction by a thorough observance of delivery deadlines, created by sending orders to adequate sources of supply and setting plausible delivery deadlines. 1day1day Total Delivery Date : 60~70days

29 Early Stage Simple Labor Manpower- focused Quality Enhancement of Productive Capability!! Productivity improvement Task Division Management Skills Safety Education Health/Environment Cost reduction Theory education Skill education Hands-on education Job Duty Understanding Job Duty Completion Job Duty Improvement Utilization of high quality labor force. Implementing Incentives: By implementing a separate incentive system other than the basic paycheck, productivity/quality enhancement is shown Great emphasis is placed on providing extra training to employees to maximize smooth and continuous production Acquire skillful workers by implementing regular employee training sessions and continuous individual training sessions.

30 Our Core Competitiveness is to operate an operational research team, technical support team, and state of the art laboratories. Also, we will operate a separate STAFF team for processing Skechers’ orders. Operation Research Team Technical Support Team Elimination of the source of quality defect → Production Efficiency Enhancement Laboratories Guarantees Credibility through various Experiments of (Material) Properties Creation of A system that can evaluate the R&D and effectiveness of a product in one-stop All details related to experiments are managed systematically Gore-tex exclusive Labs Operation Research Team takes exclusive responsibility of process analysis(production/ quality/research) Technical Support Team supports standards, technological backup, and SPEC Qualitative Quality Enhancement through efficient FEED-BACK activities

31 - The reduction effect increases gradually in proportion to the increase of orders. - Expectations of a self-owned factory creation effect without implementing separate training sessions or tangible/intangible investments. - The reduction effect increases gradually in proportion to the increase of orders. - Expectations of a self-owned factory creation effect without implementing separate training sessions or tangible/intangible investments. - Processing Prices reduced - Completed Product Prices rise as the products are now labeled as Made in Korea - Processing Prices reduced - Completed Product Prices rise as the products are now labeled as Made in Korea - Delivery Costs are reduced by using professional delivery business vehicles. - Cost reduction by minimization of warehouse storage costs due to immediate payment system - Business Travel Costs are reduced by running Shuttle Busses. - Delivery Costs are reduced by using professional delivery business vehicles. - Cost reduction by minimization of warehouse storage costs due to immediate payment system - Business Travel Costs are reduced by running Shuttle Busses. Problems of Diminishing Production rate and Risk reduced Price Competitiveness Increase Cost Reduction

32 CategoryDetail Delivery Term Time/Money saving is possible through shortening of the delivery term. Quality Competitiveness With skilled/educated workers, high quality products are manufactured. Contracted Brands’ Quality Competitiveness is enhanced Outsourcing Effect Fundamental Cost reduction from removing additional personnel management/labor management administration Securing Market Competitiveness Market Competitiveness is secured by labeling Made in Korea ZERO-Defect Effect Defects are returned to Samduk Tongsang’s A/S Center to be fixed and delivered back –> Zero-Defect Effect

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