Far East RelationshipsFar East Relationships

Consulting to the Metal Consulting to the Metal Forming IndustryForming Industry

22

Hugh Ruffing BiographyHugh Ruffing BiographyExecutive SummaryExecutive Summary Over 30 years experience in Metal Forming Over 30 years experience in Metal Forming

Management.Management.

Employment HistoryEmployment History President, Masterbuilt Tool & Die 2007 – 2008President, Masterbuilt Tool & Die 2007 – 2008

CEO, Red Rock Stamping Co. 1990 – 2007CEO, Red Rock Stamping Co. 1990 – 2007

VP Manufacturing and VP SalesVP Manufacturing and VP Sales The Dickey-Grabler Co. 1970 - 1990The Dickey-Grabler Co. 1970 - 1990

33

What do I do?What do I do?

I consult with the Metal Forming I consult with the Metal Forming Industry, so that your company can Industry, so that your company can own the process of off-shoring the own the process of off-shoring the design and build of tooling and gages.design and build of tooling and gages.

My goal is to work with you so you can My goal is to work with you so you can lower your costs and shorten your lower your costs and shorten your lead-times.lead-times.

I help remove your fears concerning I help remove your fears concerning this process changethis process change

44

What is off-shoring?What is off-shoring?

Off-Shoring is moving an activity Off-Shoring is moving an activity from the United States to the Far from the United States to the Far East. In this case, I am talking East. In this case, I am talking about the design and build of about the design and build of metal stamping dies and gages. metal stamping dies and gages. In most cases this activity is In most cases this activity is already being outsourced at your already being outsourced at your company.company.

55

Am I a sales representative?Am I a sales representative?

NoNo This process is too important to This process is too important to

farm out to someone outside of farm out to someone outside of your company. I work with your your company. I work with your employees, with the final goal of employees, with the final goal of turning the entire process over turning the entire process over to your company for long-term to your company for long-term success and control.success and control.

66

How to accomplish this task?How to accomplish this task?

• Through training and development of Through training and development of key personnel within your company.key personnel within your company.

• Through introducing you to proven Through introducing you to proven sources in the Far East.sources in the Far East.

• Through being involved with your Through being involved with your company until a die is approved at company until a die is approved at your chosen source.your chosen source.

77

Choices That You Must MakeChoices That You Must Make

Do nothingDo nothing Use a Sales or Engineering Use a Sales or Engineering

Representative firmRepresentative firm Own the off shoring process Own the off shoring process

yourselvesyourselves

88

Do NothingDo Nothing

Starting position of every companyStarting position of every company Fear of distance to a supplierFear of distance to a supplier Fear of traveling to a new countryFear of traveling to a new country Fear of a new business cultureFear of a new business culture Fear of a new languageFear of a new language Fear of new relationshipsFear of new relationships They really can’t do that !!!!They really can’t do that !!!! All the tools are junk !!!!All the tools are junk !!!! Too much effort for the returnToo much effort for the return

99

Do NothingDo Nothing You’re not becoming globalYou’re not becoming global You’re not learning what’s happening in You’re not learning what’s happening in

other parts of the worldother parts of the world You’re not being cost effectiveYou’re not being cost effective You’re not helping your customer You’re not helping your customer

improveimprove You’re not helping your company You’re not helping your company

improveimprove You’re ignoring an entire market that You’re ignoring an entire market that

your competitors aren’t ignoring.your competitors aren’t ignoring.

1010

Use a Sales or Engineering Use a Sales or Engineering Representative FirmRepresentative Firm

You’re giving your ongoing profits to a You’re giving your ongoing profits to a sales representative.sales representative.

You’re not becoming global, the sales You’re not becoming global, the sales representative is becoming global.representative is becoming global.

The relationships aren’t yours, they’re the The relationships aren’t yours, they’re the sales representative’s relationships.sales representative’s relationships.

You normally don’t control where a tool is You normally don’t control where a tool is placed.placed.

A middle man has been added in the A middle man has been added in the communication stream.communication stream.

1111

OwnOwn the Off-Shoring Process the Off-Shoring Process

Your company works with the suppliers Your company works with the suppliers directly. The relationships are yoursdirectly. The relationships are yours

Your company becomes global.Your company becomes global. Your company realizes lower tooling costs.Your company realizes lower tooling costs. Your company realizes shorter lead times Your company realizes shorter lead times

for design and build.for design and build. The process is too important to pass onto The process is too important to pass onto

a sales representative firm.a sales representative firm.

1212

Results of owning the off-Results of owning the off-shoring processshoring process

Tool costs averaged 40% to 60% of Tool costs averaged 40% to 60% of U.S.U.S.

Lead-times, for parts running on Lead-times, for parts running on automatic, were averaging 6 to 8 automatic, were averaging 6 to 8 weeks for dies that were 2 to 3 weeks for dies that were 2 to 3 meters in length.meters in length.

Tooling became a solid profit center.Tooling became a solid profit center. Profits increasedProfits increased Sales increasedSales increased

13

Lead-Time detail for Far East tooling

200 and 300 ton dies - normally 50 days for good parts on automatic (smaller dies around 2.0meters

400 and 600 ton dies - normally 60 days for good parts on automatic (longer dies around 3.0meters)

50 Day Lead-Time 60 Day Lead-Time

Description Days Total Description Days Total

Strip Design 3 3 Strip Design 4 4

Die Design 7 10 Die Design 11 15

Build / Parts Ready to Run on Automatic 40 50

Build / Parts Ready to Run on Automatic 45 60

Automatic Tryout - Approval 7 57Automatic Tryout - Approval 7 67

This is the key number of days when parts can be flown back to U.S. for our customers

Move Die to Hong Kong Port of Debarkation 7 64

Move Die to Hong Kong Port of Debarkation 7 74

Ocean time to port of Entry - Long Beach 21 85

Ocean time to port of Entry - Long Beach 21 95

Customs clearance and delivery to Client 5 90

Customs clearance and delivery to Client 5 100

PPAP to follow PPAP to follow

1414

1515

1616

1717

1818

1919

2020

2121

2222

2323

2424

2525

2626

Closing ThoughtsClosing Thoughts• Use LCC suppliers in the structure of Use LCC suppliers in the structure of

your business.your business.• Increase your company’s sales.Increase your company’s sales.• Improve your financial position.Improve your financial position.• Your company needs to be global.Your company needs to be global.• Your company must champion this Your company must champion this

process change internally.process change internally.• Your company must be proactiveYour company must be proactive• Your company must do it right.Your company must do it right.

Far East RelationshipsFar East Relationships

Consulting to the Metal Consulting to the Metal Forming IndustryForming Industry