A regional director of sourcing for Jakel has been known to check the quality of key materials by traveling to suppliers’ operations by plane, train, off-road vehicle and maybe even a yak. Yes, a yak. That’s what happens when the sourcing manager for the company’s motor and motor coil manufacturing plant in Shanghai, China, is purchasing commodities, parts and components from local suppliers—some of which may be quite some distance away in rural China.

And that’s OK with the vice president of global sourcing for the subfractional motor maker some 7,000 air miles away in Aurora, Mo. “Purchasing for our plants has become a quality control issue because we buy everything near the manufacturing plants,” says Dennis Ledgerwood, Jakel’s top buyer. “That’s why our people on the ground are expected to become experts at materials specification and parts fabrication management. To do that, site visits to insure quality are just as important as lowest-cost purchasing efforts.”

That’s also why Jakel’s commodity manager in Piedras Negras, Mexico, some 700 air miles away from the corporate offices, has to identify local quality suppliers and coordinate sourcing and delivery to the motor and blower assembly plant across the U.S. border southwest of San Antonio, Texas. “Our in-country sourcing professionals are always looking—and have had quite some success—in sourcing cost-effective parts, components and materials that meet our engineering requirements,” says Ledgerwood. “But it’s hard and time-consuming work” since Jakel doesn’t have the financial resources to operate heavily staffed offshore buying offices.

Jakel is an $80 million/year manufacturer of sub-fractional c-frame motors and blowers for major original equipment manufacturers (OEMs). In addition to small motors used in household appliances, office equipment, and consumer products, the company customizes products used in heating, ventilating and air conditioning (HVAC) equipment, pumps and water heaters to specific customer requirements.

Previously, Ledgerwood worked for Fasco Motors Group in St. Clair, Mo., a manufacturer of fractional horsepower motors, blowers and gear motors, for 25 years in various materials management and procurement roles. He then served as corporate director of materials for commercial and architectural aluminum windows maker EFCO Corp. in Monett, Mo., before joining Jakel in 2004. He points out that “running offices overseas is a financial burden for small companies; staff is tough to support, it’s a highly leveraged benefit.”

So, to help Ledgerwood and his two supply managers, the company uses Alaris Consulting of Chicago to assist in finding new suppliers of stamped metal and injected molded plastics parts in China, the Pacific Rim and Mexico and to coordinate reverse auctions of needed materials. Alaris also makes office space available in China for the Jakel sourcing manager.

Jakel’s use of low-cost country sourcing in regions near the offshore manufacturing plants came about after a skull session in 2005 between Ledgerwood and new CEO Mark  Steele, who has an extensive background in managing global manufacturing and international supply chain operations. The owners had decided to close manufacturing plants in Illinois and Kentucky in favor off offshore production. Actually, Allied Capital, a private business development corporation, made a $5 million investment in Jakel to expand the international factory operations.

Dennis Ledgerwood, left, and Mark Steele coordinate global purchasing for small-motor maker’s overseas plants.

At present, 80% of the company’s end products--mostly motors and blowers--are fabricated in Mexico while the rest, mostly motor coils and motors, are manufactured in China. The buyers’ biggest buys at both plants are coated copper wire, motor lamination steels, cold-rolled and aluminized steel sheets, zinc die castings and molded plastics parts. These days, the offshore buyers also are looking for quality sources of wiring harnesses and fasteners.

“It’s always quality; that’s what drives our supply efforts,” says Steele, who is the former vice president and director of global purchasing and supply management at the Kennametal metalworking and tool production company in Latrobe, Pa., where he led sourcing of goods and services to serve 45 factories in 16 countries. He also served as general manager of the Kennametal Electronics Products Group and president of a building products operation owned by a private equity firm.

“The whole point of what we have been doing since the start of 2006 has been speed,” says Steele, “since we are accountable to our investors to make this changeover quickly, and, in fact, purchasing costs and labor costs are down—down  enough to marginalize commodity cost increases of the past two years.” And, he adds, “we also have seen improved quality and our suppliers have improved delivery by 20%.