As many companies move supply chains out of China in response to the uncertainties of geopolitical tensions and Beijing’s “zero COVID” policy, Fictiv is consolidating its outpost in the country.

Fictiv, based in San Francisco, operates a platform that aims to simplify the hardware procurement process and connects hardware companies to suppliers around the world. When it comes to buying high-end parts for products like medical equipment, surgical devices, and even rockets, there is probably no better place than China. That is why Fictiv has set up an office there to be closer to its supplier network. In five years, the team has grown to 60 people in Guangzhou’s Southern Industrial Center.

Despite challenges related to COVID restrictions and geopolitics, “China’s manufacturing base is not disappearing,” Fictiv founder and CEO Dave Evans said in an interview with TechCrunch. “Thirty years ago Shenzhen was a fishing village and is now the center of the world for manufacturing. It will take some time for the other third-party ecosystems to really catch up, ”he said, adding that Apple and its contract manufacturer Foxconn have offered a viable playbook for a generation of factory owners in the country.

Digital sourcing proves particularly useful in the days of COVID. The conventional way, according to Evans, is a manual process that relies on face-to-face encounters: in China, you’ll need to find a shifu – a skilled craftsman in Chinese – to sit down, sip some tea and then slowly tell you from his 30s. of experience in molding to change this and that on your 3D design. Fictiv is using artificial intelligence to replace that arbitrary human interaction by allowing product developers to run simulations on 3D designs and get a quote and estimated time to production.

Despite its focus on digitization, Fictiv emphasizes the importance of field teams in its sourcing destinations. Evans traveled to China every quarter or so, but hasn’t been since the COVID epidemic, which introduced tight restrictions on inbound travel. Huaqiangbei, the world’s largest e-commerce market located in the heart of Shenzhen, attracted floods of foreign hardware manufacturers. Now foreigners are a rare sight.

“Because China has been so difficult to access in recent years, the value we have in combining software, technology and all the AI ​​we have built with the boots in the field right next to our manufacturing partners has created a truly compelling offering for everyone. customers because they can’t fly to China, ”said the CEO.

While China remains an integral part of Fictiv, the company is also diversifying. “When the next big thing happens, how will your business change? And that’s what I’d say to all founders who are thinking about this: Are you building a truly resilient supply chain? ”Evans asked.

This is partly why Fictiv recently opened an office in India, which “is very strong and getting stronger by the month” thanks to “a large population, relatively low costs and growing talent there”.

The company has built a global network of 250 controlled manufacturing partners, a third of which are located in China, where production capacity is often greater. The rest of its suppliers come from India and the United States. To date, Fictiv has produced approximately 20 million parts for thousands of customers. He manages a team of just over 300 employees around the world.

An operating system for product developers

Nine years after its launch, Fictiv is carving out a new business line. The company’s strength has been to allow early-stage product development, which is the volume of the long tail that Foxconn would deem too small. Instead of outsourcing factories to produce tens of thousands of units, work with companies looking to get 10 to 1,000.

The company’s new service is a business collaboration platform for everyone involved in the product development lifecycle. Unlike its procurement platform, which has its own profit margin built into the production model, the service charges an annual membership fee. Using the software, the engineer can upload a product design with specifications on the material used and so on. Then the supply chain specialist can come in to estimate the delivery time and target price, followed by the QA person who makes further comments. Finally, the manager will approve the price before the buyer makes the purchase.

The idea is to capture the conversation and quality control process of product development in an integrated platform instead of having them scattered across emails and spreadsheets, as communication did in the past.

“For engineers who have a team, it’s almost like a 3x improvement [on productivity] due to all the tasks you are eliminating. For design firms or people who manage many clients, [the software] it helps them organize a lot of their workflows and this gives them an easier way to fill and keep track of all the different projects in progress, ”Evans noted.

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