Supply Chain Network Design = Case Study

By Author: fgs flextronics
Total Articles: 2
Comment this article

Supply chain network design - Business Challenges

A consumer digital brand leader was servicing its European market by distributing all products from Asia into Europe as finished in their retail packaging and then distributing the products amongst the various national distribution centres. This Supply chain network design strategy led to excessively high inventory levels of certain products in some markets. Supply chain network design As consumer digital products have an increasingly short product lifespan there was a considerable amount of obsolescence. Due to fluctuating demand patterns this ‘Push Strategy’ sometimes also led to shortages of certain products across individual markets in the region.

Supply chain network design - Client Requirements

* Minimum order turn-around-time to all major markets within the region

* Flexible capacity management in production and distribution to support fluctuating seasonal demand patterns

* Reduce inventory costs in a market where product life cycles are becoming increasingly short

...
... * Improve balance between supply and regional consumer demand patterns to increase product availability for on-time delivery

* Reduce duty and inventory cost and risk

* Inbound and outbound transportation management with full visibility, KPI reporting and export documentation control

Supply chain network design - the FGS Solution

* Developed an end-to-end Supply chain network design with bulk-packed product planning and manufacturing carried out in Asia, combined with a centralized Product Completion Centre (PCC) and warehouse solution in the EU supporting finished goods inventory and finished goods assembly for the region

* Supply chain network design - Postponement of product completion within supply chain until regional end-customer demand pulls it

* Supply chain network design - Integrated WMS and TMS solutions for optimal order fulfillment service against lowest transportation costs

* Supply chain network design -Management of in-bound and out-bound logistics including VAT and customs clearance with lowest duty costs through bonded inventory replenishment solutions

* Supply chain network design - Improved returns and claims management with transparent reporting

Supply chain network design - FGS Results

* Improved order fulfillment service to 98%

* Reduced inventory carrying costs by 10%

* Reduced transportation costs by 15%

* Reduced outbound claims by 50%

* Increased inventory accuracy to > 99.5%

* Reduced Inventory Shrinkage to < 0.006%

* On-time transport deliveries > 95%

About the Author:-
This Supply chain network design strategy led to excessively high inventory levels of certain products in some markets. Supply chain network design As consumer digital products Supply chain management services have an increasingly short product lifespan there was a considerable amount of obsolescence.