A French manufacturer with a factory in Shenzhen , China , had initially come to us to confirm whether they were paying a fair price for round copper wire. During a review of their usage and logistics we identified that they were paying VAT for the wire.

White Horse focuses on ‘total cost', including unit price, cost of quality, and logistics. The VAT (Value-Added Tax) is a surcharge, which currently stands at 17.5%, on domestic sales levied by the China Customs Bureau. For factories that export their products, after proof-of-export documentation is provided this tax will be refunded, which can take anywhere from 6-12 mo nths.

White Horse's logistics team worked with our client and supplier logistics managers, in cooperation with local Customs, to arrange a “factory transfer” agreement; whereby the VAT surcharge was ceased. This improved their cash flow by 17% on annual purchase of 3.4 tonnes of wire. In addition, we qualified a new supplier at a 5% lower unit cost, eliminated shipping charges, and established a JIT stocking system with the supplier, reducing inventory carrying cost by 75%.