Logistics Assessment and Outsourcing(4PL) study for an auto component manufacturer
Title: Study of logistics network including benchmarking, identification of improvement opportunities, logistics process design and assessing outsourcing feasibility and potential
Business Scenario:
- Inbound logistics includes imports and domestic procurement
- Outbound logistics includes exports and domestic distribution
- Self-managed logistics planning processes are inadequate
- Limited visibility of inbound & outbound shipments resulted in overstocking
- Limited visibility of transportation capacities
- Inefficient and sub-optimal load planning
- Little control and visibility on the costs charged by the suppliers and the operations of the logistics partners
- A large number of partners making operations difficult to plan, monitor and control
Our Solution:
- Institutionalization of best in class supply chain planning processes for:
- Demand Planning, Production Planning (Material and Capacity) and organizational level Sales & Operations Planning)
- Multiple cost reduction opportunities identified (eg: renegotiation with transporters)
- Conversion from CIF to FOB/Ex-Works
- Outsourcing of the logistics organization processes in phased manner
Phase 1: Inbound Logistics
Phase 2: Procurement and Outbound Logistics
Phase 3: End to End Supply Chain Strategy, Planning and Execution
- Inventory Management will be an ongoing process spanning all the phases
- Greater emphasis on Quality, Performance Measurement, Technology usage and Document Management
Benefits:
- Projected annual cost reduction through better logistics & supply chain optimization
- Parent Company can concentrate on its core function
- Improved visibility & service levels
- Higher Customer Satisfaction through improved material flow leading to Revenue tapping and loss of Revenue Leakage