Are you familiar with these symptoms?
- Late customer deliveries, repeated expedites, lost sales
- High inventory levels, obsolescence, excessive operating costs
- Lack of control and excessive overhead to plan and buy material
Costs related to poor supply chain planning and execution
- Cost of capital
- Obsolescence
- Deterioration and loss
- Devaluation risk
- Overtime
- Unplanned changeovers
- Product returns
- Expedited transport
- Handling and storage
- Taxes and insurance
Typical results
Our clients typically experience the following improvements:
- Reduction in Inventory of 10% to 40%
- Increased Service Level by 5% to 15%
Payback time is usually less than 6 months
Benefits to our clients
- Complete a full supply chain segmentation for demand, supply, materials, and constraints
- Evaluate and clean up your ERP system configuration
- Define and implement an improvement process and software in as little as 6 weeks
- Align your operating plans and execution to your business model and goals
- Minimize the inventory investment while maximizing customer service levels and productivity
Improved service levels and productivity
Revenue growth due to increased customer service levels. Reduction of lost sales due to improved material availability and backorders
Productivity improvements and reduction of costs directly related to product availability: Expedited freight, overtime, costly changeovers, supplier expedite fees
Reduction of inventory
Reduction of the cost of holding inventory:
Cost of capital, obsolescence, deterioration and loss, devaluation, returns, transportation, handling, storage, taxes, insurance
Reduction of working capital requirements (one time free cash)
How do I quantify the benefits of an integrated supply chain planning and execution process?
Operating expenses
- Reduction of expedited freight and unplanned changeovers / setups
- Minimization of overhead costs required to plan and execute across all functions
- Optimization of warehouse space and material handling
Inventory and working capital
- One time cash inflow for the total value of the reduction. This cash can be used to buy equipment, invest in product development, acquisitions or dividends to owners
- A recurring cost savings for the amount of inventory reduced multiplied by the inventory holding cost rate (usually 20% to 25%)
Customer service and material availability
- Increase in delivery performance protects/increases sales and therefore market share
- Improve raw material and component availability
Contact us
Dr. James Rappold, President
Pedro Rodriguez, Managing Director