15%

reduction of total cost of goods sold

$3.2m

cost savings in freight spend

8-Day

reduction in transit time

Solar Manufacturer Logistics Management

A leading solar manufacturer had a complex supplier footprint coming from Asia to the U.S. While still in the early stages, the company utilized a large third-party logistics provider (3PL) to organize shipments, which they did as an LCL (less container load). This proved to be costly, inefficient, and extremely difficult to manage. The company employed Global Sourcing Management to help create and execute a global logistics strategy and manage the 3PL to help ensure stability and scalability during a significant growth period. In the process, we gathered detailed logistic shipping information from each supplier, creating a database for all supplier information. With this information, we designed and optimized an ordering program to help fully utilize shipping containers and consequently reduced shipping cost and increased efficiency.

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Goals

  • Reduce complexity: reduce LCL shipments, reduce shipping origin points, own the process internally
  • Conduct analysis of optimum shipping lanes for cost, speed, and consistency
  • Create optimized shipping specifications
  • Implement a strategy that incorporates consolidation and maximizes logistic spend
  • Design/build a custom tool to fully utilize shipping container space
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Obstacles

  • No current shipping specifications
  • No visibility on shipping and lead times
  • No current forecasting of future ordering needs
  • Long lead-time to ordering (60 days)
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Results

  • Quick execution: cost reduction realized by client within the first 60 days of the project
  • Global RFQ for 3PL, resulting in increased performance in port availability and a stabilization of freight rates
  • Executed a strategic freight consolidation program to facilitate quick and efficient container shipment
  • Created customer tool to develop maximum utilization of containers for ordering
  • Developed custom forecasting/ordering tool to provide demand schedule to the logistics company, securing equipment needed through all seasons
  • Improved tracking and visibility program, ensuring all teams are aware of timing and schedule of inbound materials
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