Supply Chain Strategic Review

Client: After-market and OEM four-wheel drive equipment manufacturer
Background

Our client is a business that designs in Australia, manufacturers in Australia and Asia and distributes through an Australian franchise network and into markets across the world.  It is undergoing rapid international growth and has ambitions to significantly increase market share in Australia.  Its supply chain capability is critical to growth. 

Challenges
  • The sales split between Australia and rest of world is shifting significantly
  • Customer service and “closeness to supply” expectations are not being met
  • The management processes used to coordinate planning and operations were not fully integrated and aligned across all functions of the organisation.
Approach

A strategic review of the supply chain was undertaken to understand:

  • Where the business will be and how will it look in 3 years
  • How the supply chain should be designed to meet the expectations of the domestic franchisees and rest of world customers
  • What the financial impact of the supply chain designs would be
  • What inventory investment would be required to support the supply chain model and meet customer needs
  • How the organisational capability (people, processes, systems and data) of the business could be refined to best support the new business model  
Outcomes
  • Quantified current and proposed  models that clearly illustrate the cost and structural benefits of an alternate supply chain strategy and design
  • Opportunities to optimise inventory were highlighted that would support a 100% increase in sales with a 30% increase in inventory
  • A clear roadmap of organisational capability improvements to provide immediate improvements in operational performance and support the future ambitions of the business

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Testimonials

The GRA facilitators really engaged our team well and the facilitation approach ensured that the team saw it as their process. Running “The Beer Game” at the start of the workshop was a great way to make the challenges of integrated planning real for our team.

– Lee Rawstron, Head of Operations ANZ, Sinochem Australia

Typical results

  • 20-40% inventory investment reduction
  • increased service levels ranging up to 99.9%
  • 10%-15% reduction in supply chain operating costs
  • 5%-20% spend management savings
  • the ability to fund business initiatives from operating cash flow (OCF) improvements
  • improved return on capital employed (ROCE)
  • a minimum 3:1 ROI (10:1 to 30:1 typical)