Case Study: Smith Service Supply Chain Strategies
Smith & Associates implements a Supply Chain Strategy to reduce the total cost of inventory ownership for a global consumer electronics manufacturer.
Challenge: A global consumer electronics manufacturer needed to reduce the cost of operating a service and repair hub. The service and repair hub was necessary to fulfill customer service agreements, but it did not generate profit for the manufacturer. This manufacturer sought to find a Supply Chain Strategy that increased overall efficiency and reduced warehousing, procurement, and inventory costs, in short, it sought to reduce its total cost of inventory ownership.
Solution: Smith & Associates evaluated the company's needs and created a customized Supply Chain Strategy. Smith began implementation of the strategy by taking ownership of the customer's on-shelf inventory. Inventory was then hubbed at Smith's ANSI/ESD S20.20.2007 certified warehouses.
Working from the customer's weekly demand reports, Smith procured necessary components on the open market through its global network of trusted suppliers. As a result of Smith's years of experience, market knowledge, and long-standing relationships, the customer was able to secure necessary components including hard-to-find, obsolete, and end-of-life parts.
Smith's internal vendor screening program and in-house quality testing and inspection procedures ensured that parts were functional and met specifications. Following testing and inspection, Smith's global shipping, warehousing and logistics hubs rapidly and securely expedited the parts to the customer's service and repair hubs on three continents in time to meet their customers' needs.
Benefit: Smith's Service Supply Chain Strategies provided this customer with a comprehensive solution that reduced its total cost of inventory ownership by:
- improving service levels
- shortening average lead times
- increasing warehouse capacity
- reducing warehouse and logistics personnel
- increasing inventory turns
- securing a source for obsolete, hard-to-find and end-of-life parts
- ensuring quality through testing and inspection; and
- decreasing capital exposure
Smith's expertise in open market parts procurement, commitment to quality, and customer focused Supply Chain Strategies have helped this customer monitor and control inventory costs. This customer continues to find value in Smith's Supply Chain Strategies and has relied on Smith to advise on new strategies for other business units.