Did your China sourcing programme deliver savings?
Compare evidenced results with the approved baseline and forecast, adjusting for changes in demand, specification and market conditions. Deduct implementation costs, assign owners to each benefit and record what remains unproven. Review quality and delivery alongside savings. Request supporting factory records from Cambridge China Bridge.
Use Treasury guidance with its scope clear
HM Treasury’s Green Book is intended for proposals using public money and distinguishes appraisal from evaluation. Its Magenta Book provides guidance on designing evaluations. For a privately funded sourcing programme, use these as methodological references. The review below is a practical buyer process, rather than a statement of government requirements for your business.
Retrieve the approved sourcing business case, including its forecast, assumptions and acceptance criteria. Preserve that version. Record later changes separately so a revised target cannot conceal a missed promise.
Reconstruct a comparable baseline
Collect the purchase ledger, invoices, credits, freight bills, receiving records and defect records behind baseline spend. Define the products, specifications, destinations and period covered. Include the costs of obtaining usable stock, rather than comparing factory prices alone. Use the customs clearance guide to identify relevant clearance cost lines.
Estimate what continuing the previous sourcing arrangement would have cost for the actual demand and product mix. Document the evidence and assumptions behind that comparison. Separate changes caused by volume, specification, exchange rates or freight markets from changes attributable to the programme. If baseline records are missing, label the estimate and its uncertainty.
Reconcile realised savings with the forecast
Maintain a benefits register showing the approved forecast, realised result to date, remaining forecast, evidence, owner and explanation of any gap. Follow the order savings verification guide for transaction checks. Compare the same period and scope; future orders remain forecast until their costs and outcomes are evidenced.
Calculate gross realised savings as the comparable cost of the previous arrangement less actual ongoing sourcing costs. Reconcile invoices, credits and receiving records, and flag unresolved charges. Separate spending reductions, avoided future costs, payment timing and released staff capacity. Do not count the same gain under several headings or treat unused capacity as a cash saving.
Deduct implementation costs and appoint owners
Record samples, tooling, testing, supplier onboarding, travel, systems changes, training, parallel purchasing, obsolete stock and review effort where incurred. Distinguish transition costs from ongoing operating costs. Show gross savings and net benefits separately, deducting costs only where they have not already entered the comparison. Keep cash costs and valued internal staff time visible separately.
Appoint a buyer-side owner for each benefit who can influence its delivery and confirm the evidence. Procurement can reconcile purchase costs, finance can confirm spending effects, and operations can validate quality and delivery. Ask Cambridge China Bridge’s staff in China for factory-side records. The buyer’s owners should sign off the benefit claims.
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Complete the post-implementation review
Set a review date once repeat ordering and receipt provide useful evidence, then revisit benefits that mature later. Have someone outside the original forecast preparation challenge the results. Examine whether the sourcing changes happened as intended, whether promised outcomes followed, and whether the net benefit justified the resources used.
Review defects, returns, delivery reliability, stock availability and unresolved supplier issues alongside savings. Use supplier performance comparison for consistent measures. Record achieved, partly achieved, unproven and missed benefits, explaining attribution limits and unexpected effects. Agree whether to continue, correct or reconsider the programme, with an owner and due date for each action.
Frequently asked questions
How do I prove China sourcing savings?
Compare evidenced actual costs with what the previous arrangement would have cost for the same demand and specification. Reconcile invoices, credits and receipt records, then deduct implementation costs without double counting.
Can I count quoted savings as realised savings?
Keep quoted savings in the forecast until actual purchasing costs and outcomes support them. Show realised results to date separately from expected savings on future orders.
Who should own sourcing programme benefits?
Name a buyer-side owner for each benefit. Finance should validate spending effects, while operations confirms quality and delivery. Factory records support the claim; the buyer signs it off.
When should I review a sourcing programme?
Agree a review date when repeat orders and receipts can support a meaningful comparison. Revisit later benefits and unresolved costs, and assign owners and due dates to corrective actions.