As an airline and traveling service provider, KLM wanted to develop an innovative product that resonates with every business traveler‘s family–a night light that counts down the days until the traveler is home again. KLM approached a design studio with this idea, so an unique electronics product design was created:
A small airplane-shaped lamp with a light shining trough each window for representing the days the traveler is away from home. One lighted window extinguishes every night, and when all of them are off, the traveler is home again. The sophisticated functionality stands out in comparison to other nightlights.
The Challenge
Once the design files were completed, KLM needed the night lights to be mass produced. The challenge was that they wanted them quickly, at a reasonable price and in good quality. The novelty of the product and the necessary PCB (microchip) development required dedicated effort. Furthermore, the custom plastic parts had to be produced from scratch.
The Story
As an airline and traveling service provider, finding suitable suppliers, communicating the ideas to them, and maintaining product quality is a lengthy process, and the cost can be high for a novel product like this. The distance to the manufacturing location and little experience in this field makes own supervision inefficient and risky, while other electronics production services companies charge very high fees for product development.
The Solution
The First Step
We performed a detailed product costing for both the standard and custom parts from original equipment manufacturers (OEMs). This considered what materials to use for the product components, then compared and analyzed suppliers for each part and material to get the most accurate product costing to bring down costs while maintaining quality. Intrepid Sourcing also helped with designing packaging that tells the story of the night light and their brand.
The Second Step
We created a lead time assessment. This determined how to arrange and organize the suppliers for printed circuit boards (PCB), plastics, adapter, and assembly. All was done with an eye toward increasing efficiency and reducing lead times. Coordinating the numerous suppliers and the final assembly is key to this efficiency.
The Last Step
We provided intermediary services, managing all payments and financial transactions directly with their suppliers. This saved time for KLM, and avoided international and other transaction fees so that they could focus on their core business.
The Outcome
KLM doesn’t need to worry about product development, packaging, finding, communicating with, and making payments to suppliers. Instead, they can focus on their business’s core competency, such as providing airline services and offering corresponding merchandise, marketing, and others. Third party manufacturing solutions give the full flexibility needed.
Also An International-Renowned Airline Company Like KLM needs help setting up OEM production lines. Although the night light is a relatively simple product, realization of the design at an affordable cost under consideration of good quality can be challenging. With Intrepid Sourcing’s help, KLM was able to find reliable suppliers so that they were able to have the night lights produced quickly by solely providing the design files, saving them time and costs.
