Executive Summary
This longtime partner looked to TTI to reduce costs and accelerate inventory turns to reduce on-hand inventory as their part number count with TTI increased by 2,000 SKUs annually. A supply chain analysis recommended expanding an existing consignment program to align with the customer’s improvement goals.
The Company
A nearly $1B leading supplier of warehouse automation, electric vehicle assemblies, seating systems, and more to diverse industries. With a commitment to innovation, excellence and continuous improvement, the customer's solutions cater to the evolving needs of the transportation, warehousing, construction equipment, industrial and recreational vehicle markets.
The Challenge
TTI’s long-term relationship with the customer enabled the investigation of innovative ways to address opportunities along the path of continuous improvement. Specific areas were analyzed to address performance goals, including inventory turns velocity and management of costs associated with on-hand components.
Solution
Based on a long-term relationship, TTI processed a detailed analysis of the existing processes and cost. The focus was set on constraints along the process and buffer inventory. In a strong collaboration improvement could be facilitated by the implementation of a consigned inventory model. Also new controls, the definition of key performance indicators and regular reviews resulted in excellent performance increases.
Results
- Increased turns velocity removed over $250,000 inventory from the customer’s balance sheet
- Proactive collaboration to add new part numbers to the program quarterly
- Proactive maintenance reporting identifies aging parts and velocity slowdown