Sourcing steel for a construction project in Malaysia.
Despite Malaysia undergoing rapid economic development over the past five decades, high-grade steel is difficult to source locally. Another obstacle we found was that importing high-grade steel from China came with a 15% MFN and 6% sales tax additional charge.
We then sought economic advice and discovered that the global price of steel was at an all-time high and the significant increases were partially unsupported by market fundamentals. Foreseeing a drop in steel prices, we achieved a profitable outcome by forecasting the right time to purchase.
The extended lead time allowed us to hire a Malaysian representative that worked with us to import primary materials from China which attracted low import duty. We then fabricated the specified steel grade within Malaysia at a lower price than importing from China.
To further reduce our clients material cost, we connected with other local construction companies that wanted to piggy back off of our wholesale order on primary materials which unlocked greater wholesale prices, resulting in a reduction in all parties’ cost per Kg.
Here at Fratsy, we pride our knowledge in sourcing in parallel with our innovative group purchasing ability. The project above is one of many, although this project has now ended due to the completion of the construction. You can find other products you can piggyback on yourself here. Or you can request for us to reduce your unit costs with our community of group buyers here.
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