A good relationship with our suppliers

Liebherr values the cooperation with its suppliers in long-term relationships, which are characterized by mutual trust and are based on a common understanding of quality and required performance for the customers’ benefit. Communicating effectively about quality related requirements with suppliers is the responsibility of an experienced system manufacturer such as Liebherr.

Next to innovation and on proper workmanship we focus also on a process-based development collaboration that assures quality in all our activities. In order to evaluate and maintain good supplier relationships, we use performance based quality metrics to identify and evaluate our suppliers.

Our Procurement Supervisor Dan Yu and Quality Manager Peter Gu are responsible for frequent supplier evaluation and auditing. This includes for example factory examining, managing supplier quality performance and the development of potential suppliers. Dan and Peter audit suppliers, document findings, and generate target agreements with our main suppliers to implement improvements. This assures not only a better collaboration with Liebherr but improves also the overall competitiveness of the suppliers.

Dan and Peter give some insight of supplier auditing and supplier development activities at Liebherr-Transportation Systems (China).

Q：Dan, Peter, please tell us something about your work.

Peter: We manage the initial assessment of potential goods and service suppliers through audits and make sure that our suppliers have implemented processes and tools as well as the operational capability to meet our specifications and quality standards.

Furthermore, we consequentially assess and monitor if the workflow and the necessary documentation are done in line with our railway related industry standards.

In case we find discrepancies to our requirements, we actively develop the supplier to meet Liebherr's requirements. We enhance the relevant capabilities of selected suppliers, to ensure a long-term, stable material supply chain. This procedure is applicable to the development and management of suppliers, whose materials are directly related to the company's products, including the suppliers of production and auxiliary materials as well as spare parts.

Dan: Our procurement department is responsible for the development and management of suppliers for external materials, products, outsourcing processing and other services.

Q: Could you give an insight of potential supplier evaluation?

Peter: A potential supplier is evaluated based on the company scale, the industrial delivery performance in the past, the certification status and quality assurance. A Liebherr cross functional team consisting of a procurement supervisor, a quality manager and a research & development manager decides on the individual supplier evaluation measures whether it is necessary to conduct on-site audits in regard of engineering, production and testing or not. Our quality management department performs an on-site audit and fills out the ‘Supplier On-site Audit Form’. Based on the feedback of these audits and evaluations, the supplier is approved by the management of Liebherr-Transportation Systems (China) before being added to our suppliers list.

Q: When does Liebherr need to choose new potential suppliers?

Dan: Our procurement department develops new potential suppliers, in case the existing supplier cannot meet the technical or commercial requirements of a new project or as per our further R&D needs.

Focusing on research and development work, we intensively work together via our procurement team with innovative, reliable suppliers based in China to provide the material in line with the latest technical standards and requirements. We understand our mission not only to improve our Liebherr own cost base but also to work together within our industry sector to provide best quality, best costs and innovation made in China to the global rolling stock market.