70%Reduction in redundant stock returns and write-offs
While the company’s client base is principally European, they achieve worldwide sales.
Their complex product range continually innovates and their market ranges from individual hobbyists to boat builders. They also had a legacy network of subsidiary company warehouses.
The above factors were creating significant logistics management problems. Specific issues included difficulties in inventory management, with high write-offs, poor availability of stock, administrative complexity and excessive supply chain costs.
There were also challenges with their poor visibility of service levels and cost structures. It was our role to make things easier and more efficient.
How we delivered
We offer expert personalised solutions to help your business succeed. We delivered the following services to help this client's growth.
Our supply chain solutions team mapped all our client’s processes and their associated costs. We were provided with data downloads from their computer system and supplemented this information with visits to subsidiary companies, empirical data collection and high level meetings.
This information helped us to establish specific customer services needs with both central and regional management. Our objective was to establish a holistic picture of the client’s supply chain, including:
- Inventories in warehouses, in transit, rework and write-off, together with all associated costs.
- Material flows and transportation networks – performance levels and costs.
- Management responsibilities and methodologies for inventory management at central and local level.
- Administrative processes interacting with the supply chain.
- The achieved and required customer service levels by market sector.
- Constraints imposed by manufacturing technologies and central warehousing operations.
Our data analysis and modelling indicated that simplifying legacy structures, and providing a new forecasting model and central control of stocks, would benefit their inventory management substantially.
Our solution included removal of most inventories from their European subsidiaries (except 'Trade Counter' stock) and direct supply to all third parties. We re-engineered their transportation network to preserve or improve on lead times and introduced real time tracking & tracing and PODs.
The solutions we put in place helped our client to reduce their inventories by 45%, and their redundant stock returns and write-offs by over 70%. We also removed double handling and warehousing costs in mainland Europe and reduced European supply chain costs by 19%.
- Introduced fixed lead times and made major improvements in customer service.
- Ex-stock availability increased from under 60% to over 85%.
- Enabled transparency of costs/service levels by management reporting against KPIs.