Case Study:

Poor inbound logistics practices were hampering the ability of a major manufacturer of military combat vehicles to meet deadlines for new orders. Among the issues:

• Inventory accuracy levels below 60% resulted in significant inventory increases and a shortage of space and warehousing capacity at the manufacturing site
• Mandatory outside audit results were “unsatisfactory”
• Co-mingling of slow moving and discontinued parts with current product line parts led to inefficient warehouse operations
• Multiple warehouse and overflow facilities for parts resulted in costly expedites and production delays

Strategy

In conjunction with a major consulting firm hired by the client to re-engineer procurement and manufacturing processes, Daryl Flood Logistics implemented the following action plan:

• Secured, outfitted and staffed a 250,000-square-foot inbound logistics hub in 15 working days
• Defined receiving, put away, picking and shipping processes to support the timely flow of parts to manufacturing
• Redesigned warehouse to place fast-moving parts in forward pick areas
• Implemented tight cycle counting procedures to increase inventory accuracy
• Re-engineered overall processes to reduce expedites and costs for the client

Results

• Achieved inventory accuracy of 98.5% in less than 60 days from start up
• 30% cost reduction
• 25% reduction of expedited shipments
• Eliminated manufacturing ‘shutdowns’ due to missing or delayed parts