What if you were offered two jobs: One paid you a decent wage and offered the hope of raises if you improved your company's profits. The other paid you a decent wage but required you to buy your own desk, computer and supplies as well as take a 5 percent pay cut every year but also expected you to improve your company's profits. Which would you choose?
In a recent edition of Plastics News [“Visteon pushes suppliers for upfront fees,” Feb. 24, Page 1], Visteon said they'd like to consolidate their supplier base from 1,500 to 500. Those lucky companies will end up absorbing the tool cost and taking on constant part cost reduction tasks of 5 percent per year.
How do you think this game will be played? Will Visteon get a competitive price or one that is so inflated the supplier can afford these reductions and not be put out of business? Too many people read The Purchasing Machine and didn't understand the supply works only when both parties prosper.
Good luck to those fortunate 500 folks. Visteon will take care of them.