An assembly company has enhanced its efficiency with the implementation of a supplier network delivery management service

Proactive and responsive delivery management as a service enhances overall customer efficiency and service performance. The service oversees the customer’s overall productivity and service performance, rather than individual logistics costs. The service has achieved benefits that exceed the overall logistics costs, despite an increase in individual costs. By optimizing the material flow and eliminating unnecessary buffers, the plant’s throughput was doubled.

Starting point

The network supplier company, a pioneer in its field, recognized the importance of maintaining service and supply continuity with its supplier network as a key factor in improving the competitiveness of its own production. A thorough examination of the supply chain revealed that the use of inexpensive, readily available services resulted in significant additional costs. These included the time and resources required to clear deliveries and rearrange production, accommodate peaks in demand, maintain large inventories, and overcome the challenges of long distances in production. At the same time, the objective is to eliminate redundancies in the supply chain and to leverage the strengths of suppliers.

The initial objective was to identify a partner capable of providing a dependable delivery management solution and associated services through the use of e-solutions as a comprehensive offering. Furthermore, the supplier was required to assume responsibility for the management and development of the services. The solution had to provide certainty and predictability of supply in order to reduce inventories, lead times, steps in production, and risks in assembly and supply chain.

Solution

The solution was developed in accordance with the customer’s demanding requirements and the capabilities of the supply chain. Logate conducted a thorough analysis of the supplier network’s capabilities, current situation, and potential solutions, all with the customer’s needs in mind. The client’s transport concepts were revised, transport management and control were initiated, transport orders were electronically managed, and Logate identified suitable carriers for the solution.

Logate managed the entire delivery process, from the supplier to the customer’s assembly point. The solution made use of routing where appropriate, and other services were provided as required.  Logate also assumed responsibility for the day-to-day operations and development of the service. The service is managed from the customer’s perspective. The solution is based on proactive customer care.

Benefits of the solution

• Achieved over 99.9% reliability of supply
• Significant reduction in transport damage as handling of goods was minimized
• Transport lead times close to courier class and synchronized with the production rhythm
• Reduced workload in goods receiving
• Suppliers’ delays and delivery errors were caught at the supplier level
• Reduced time spent on tracking deliveries
• Substantial reduction in production reorganization
• Savings of more than 20% in total internal logistics costs