Asia Express - Consumer Electronics
Sony to Reduce Suppliers by 50%, Shed Procurement Costs by 20%
May 22, 2009
Following its plan to cut fixed costs by over 300 billion Yen (US$3.2 billion; US$1 = 94.7 Yen), Sony announced on May 21 that it plans to reduce the number of its parts and materials suppliers by 50% during 2010-2011 as part of its efforts to restructure its business, Reuters reported on May 21. At present, the company has a total of 2,500 suppliers, to be reduced to 1,200 by March 2011.

 

Additionally, the company also stated that it will slash procurement costs by 500 billion Yen (US$5.3 billion), or 20%, in the fiscal year 2009, which runs from April 1, 2009 to March 31, 2010. In order to reduce costs, the company will increase the volume of procurement from individual suppliers. Sony's procurement costs currently are valued at about 2.5 trillion Yen (US$26.4 billion).