In if 4 Yuan in the product price, the raw material cost accounts for only 1 Yuan, but it is difficult to further save, so, this link is no high value? Product design and production, it turns out, such as the materials together, 75% of the value creation ability is falling on the product development; Instead, depend on the value of the raw material cost savings can be created only 25%.That is to say, the promotion enterprise's technical level, optimize the product structure, product research and development design and production decision, in particular, can get rid of the constraint of raw material costs, create a higher value. This is what we want to say the IPD (Integrated Product Development), manufacturing enterprises need to make the whole system is a constant efficiency and Product improvement, so as to create a higher value in the global competition. The Mattel (Mattel) to strengthen the IPD, a year spend a lot of resources research and development, and specialized laboratories and cross-department team specialize in product design and development work.
China's enterprises are not only on the raw material production by multinational firms, the lack of product innovation ability, on other higher value link, is also a lack of voice, in the weak side of the competition. The Mattel (Mattel) held on all levels of procurement, storage and transportation, order processing, wholesale sales and so on each link, and at the retail end with wal-mart (Wal - Mart), and other large chain alliance, is only the minimum value of production outsourcing manufacturing enterprise production to China. It is larger than those links of the raw material to produce "hard one Yuan", is a $4 retail prices of the other three yuan "soft", because they have greater value and a higher value mining potential.
Even simple comparison, the manufacturing enterprises on existing technical level and product structure, also need to control, and tighten the whole supply chain system, optimizes the allocation of resources in each link, to obtain high value, rather than scattered, isolated to each link. This is what we call of ISC (Integrated Supply Chain).
