Our customer designs and manufacturers highly complex test and measurement equipment to a global customer base. The firm has operations in the USA, Germany and the UK – where it has turnover of £9bn.
The firm’s core strengths are around the development of sensitive, specialist mechanical components, but lacked knowledge within assembly of electronics based products, such as electronic components and PCB’s. The manufacturer’s smaller buying team were also struggling to keep up with the larger quantities of electronics parts, with hundreds of items needing to be managed. Being an R&D-led business, the firm was working with poor planning systems and an inability to successfully forecast. Due to these issues, the company had high inventories and obsolescence, and regular stock-outs.
We presented our client with a staged supply chain strategy, launching with our consolidation of vendors and material, as well as supplying components in kit form. As we began by purchasing all customer stock, there was an immediate reduction in customer inventory. Early wins were also found in stock accuracy and quality of delivered kit to their production floor.
The next stage was to convert many of the piece parts into built sub-assemblies, reducing time in customer production with only the final assembly to conduct.
Further improvements needed to be made as turnover improved Our customer was restricted in employing further head count by their German parent company – they needed to outsource more of their operations. We sent over a team of operators to document the final electronics build process and within two months we were supplying fully assembled products straight to the customer’s manufacturing facility.
The staged project was initially outlined over a two-year period but was accelerated to just six months. The customer benefitted from reduced inventory and internal cost base, exceeding quality and increased sales, as well as unexpected improvements in documentation and build control.
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