The customer wishes to remain anonymous in this case study; therefore, it is referred as The Lighting Manufacturer.
At A Glance
- Customer is a producer of indoor/outdoor lighting devices and emergency lighting
- Chainlogix proved itself with an initial BPO on four custom passive components used for an LED driver
- Chainlogix now oversees 300 active SKU, from magnetic components to IM plastic, finished goods, cables, flex conduits, and metal casing
- Expansion of AVL on key parts for better cost, quality, and availability
- Custom supply chain with JIT delivery, safety stock, warehousing, and coordination with Lighting Manufacturer’s 3PL and freight forwarding partners
- Single point of contact to provide project management and reduce complexity
- Flexible production runs for each part - from just 50 parts per month to 100’s of thousands of parts per month
- Lower manufacturing costs and more cash flow
- Assurance of supply: faster reliability and reaction time to variations in quantity
- Avoidance of additional overhead costs and better utilization of internal resources
- A superior rate on Lighting Manufacturer’s quarterly scorecard while providing white glove customer service
The Lighting Manufacturer is a multi-billion-dollar manufacturer of various lighting devices such as controllers, sensors, panels, switches, LED drivers, gateways, converters, etc. It operates on an international scale and delivers its products to contractors, distributors and large retailers.
The Challenge: Don't put all your eggs in one basket
The challenges of sole sourcing and supplier diversification
The Lighting Manufacturer previously relied on a single supplier for some magnetic components utilized in the light production process. The company sought to diversify its reliance on a single supplier to achieve an increase in gross profit margin and a reduction in cost per part. The high dependency on a single supplier for multiple critical components eliminated negotiating power with the supplier and had an increased risk of business interruption in the case of supplier problems.
Its procurement process is also profoundly complex due to the sourcing and inventory management control required. The overreliance that had been placed on suppliers for its supply chain was not efficient nor cost-effective in achieving a lean operating strategy. The manufacturer needed to deploy a dynamic supply chain strategy to minimize the total cost of supply.
The Solution: Your Supply Chain Issues Are Our Supply Chain Issues
Chainlogix Provides Supply Chain Stewardship
The Lighting Manufacturer was able to leverage its supply chain by collaborating with Chainlogix. Chainlogix provides custom supply chain solutions to eliminate complex and overdependent supply chains. Chainlogix was able to partner with the manufacturer to simplify the procurement process while obtaining sustainable cost reduction. For example, it had only one provider on its AVL for 4 magnetic components. Chainlogix was able to identify a more reliable source to manufacture these components for the manufacturer while realizing a cost reduction of 12%. By managing the manufacturing and assembly process, Chainlogix provided recommendations to stabilize its overreliance on production inputs, by identifying new sources for improved cost, quality, and availability. Chainlogix was also able to leverage its warehouse for some components to help simplify the process while guaranteeing JIT, where it made strategic sense.
By managing these supply chain activities, The Lighting Manufacturer has been able to free up cash flow while preventing line-down risks. The favorable terms Chainlogix was able to source drastically improved its mobility in operational cost-efficiency. Since the improvements have been implemented, Chainlogix has maintained a high rate on the manufacturer’s quarterly scorecard while providing white glove customer service.
The Results: a Partnership That Stands The Test of Time
By simplifying and managing the entire in-house assembly, Chainlogix helped its client avoid additional overhead costs. It also simplified the design for manufacturing process, including assembling and packaging, so that the manufacturer could focus on its core capabilities and deliver maximum value to its customers.
The Lighting Manufacturer received top of the line customer care, with a designated account manager, routine headquarter visits and reliable and constantly available assistance.
Eight years later, the Lighting Manufacturer continues to leverage Chainlogix to provide positive PPV for its business and supply chain stewardship.
Chainlogix services varying types of commodities such as IM plastic, finished goods, glass, cables, flex conduits, and metal casings. Chainlogix manages over 300 active SKUs on the Lighting Manufacturer’s supply chain. All its SKUs, including coordination with their 3PL, have been handled via Chainlogix’s state-of-the-art ERP system. This integration enables faster reliability and reaction time to variations in quantity.
Chainlogix regularly coordinates with the Lighting Manufacturer to stay fully up to date on their current needs and pain points. Regular on-site visits are conducted with over 20 stakeholders including engineers, sales managers, and supply chain leaders. In providing top-quality customer service, Chainlogix also appointed a dedicated customer service representative to cater to the manufacturer’s needs, ensuring constant accessibility for urgent matters that need to be addressed. Chainlogix aims to serve as an advocate to complex supply chains and demonstrates its dedication through its genuine, long-lasting partnerships.
Chainlogix Solves Supply Chain Challenges With Impactful Solutions
Since 1998, we have provided supply chain management solutions that help manufacturers design and build cost-effective, high-quality products and improve their bottom lines. We strive to deeply understand our customers’ businesses and tailor supply chain solutions to their unique needs. Our team of solution-driven engineers has decades of experience in global logistics and a passion for results. With broad capabilities, global supply chain connections, and a dedication to customer care, we are a trusted partner for demanding customers.
Our team of experts can manage:
- Planning and procurement with preferential access to a broad supplier base and AVL optimization
- Cost-optimized inventory warehousing and fulfillment
- End-to-end supply chain tracking and communication
- Product innovation through design and re-design through its partners
Serving the industry for 23 years, we have established nearly 200 supplier partner contracts. Headquartered in Charlottesville, Virginia, we operate worldwide with global strategic sourcing offices based in the USA and Zhuhai, China.
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