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The first of what will become a series of seminars was held in Guangzhou on August 13. The event was divided into two parts: the morning session was presented by Raymond Leung and Richard Wong from Hong Kong, and the afternoon session by Michal Spacek from the Czech Republic.
The morning session was tailored to those involved in the supply chain. There were representatives from footwear and handbag manufacturers, design studios and chemical suppliers: such as AIMI, Au Feng, BASF, Datum, Day Timer, Dongguan Zerong, Fujian Footwear among others.
The event examined such topics as:
· simple-to-use methods to improve forecasting accuracy and reduce inventory expenses
· cost reduction factors and key approaches/techniques for reducing overheads and indirect costs.
Messrs. Leung and Wong went through case studies, providing attendees with plenty of examples.
   
Michal Spacek presented the afternoon session. He went into further detail on cost reduction. He offered some surprising examples: for instance, a worker in Europe can produce 40 pairs of shoes per day, as against just 20 pairs per day per worker in China. So, although costs may appear lower in China worker productivity is just half that of Europe.
He explained that Asian manufacturers can increase their returns on orders from Europe by adopting quite simple steps. He demonstrated how simple production techniques could help reduce rejects and claims from the average 10% in China and closer to the standard of less than 1% in Europe.
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He advised footwear producers to develop their own measuring system customised to the needs of European end users.
A further small, but still useful improvement could be made in reductions of the work-in-progress costs. Typically, these are items for which the manufacturer has already paid but not yet used. Using, again, a comparison with European manufacturers he pointed out that the average in Europe was 2-3 days, whereas in China it was 4-6 days.
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Some examples were almost too obvious to mention but....... Mr Spacek told of instances in which the shoe production line came to a complete halt at lunch time. Shoes in the process of having the soles glued on sat there, stopped, with the glue hardening. A rationalisation of steps in the production process should be able to easily prevent such a thing.
Generally, Mr Spacek recommended reducing the number of operations by rationalising the entire process.
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