Supply chain strategies befuddle manufacturer
Case Studies
Supply chain strategies befuddle manufacturer
Our client is in the business of assembling durable commercial goods that contained both purchased and engineered components. The client owned the business for many years and as a result, there were numerous strategies for procuring many of its engineered components. At first, the strategy was to outsource everything possible for cost reductions and lower overheads. Then the strategy was changed to insourcing to gain control. Next, cellular manufacturing was going to cure all the problems. After that, it was investing in new technology. After more than 10 years of wrestling with the issue of procuring the lowest cost, the client called us for an unbiased, data-driven assessment of identifying and implementing the least cost strategy for each component.
In short, a new systemic approach to determine the best long-term, lowest cost combination of purchasing and manufacturing components was used. The initial pilot provided over $5 million of annual ongoing cost reductions. The capital investment was approximately $260,000 to accommodate new fixtures and tooling for purchased components.
Activities in this case study include:
- Analysis
- Supply Chain
- Cellular Manufacturing
