A developer, manufacturer and supplier of automotive radiators, climate control products and thermal solutions to businesses worldwide, this European customer prides itself on an ability to address virtually any customer need. Through a longstanding commitment to curiosity – always exploring new paths and never settling for anything but the best – it maintains a strong knowledge of technology and markets.
This knowledge had served the company well over the years, facilitating tremendous growth internally and for its customers. It faced a challenge, however, in rising China transportation costs.
The company had traditionally performed quality-checks of Chinese-made goods after the goods had left China and upon their arrival at the central distribution center in Europe. To optimize transportation costs, diversify its China supplier base and consolidate shipments, the customer recognized the need to improve quality-checks before the goods left China, but did not have the local presence to do so.
- Improving product quality controls
- Reducing costs for returning defective products
- Diversifying and improving its China supplier base
- Consolidating shipments to reduce transportation costs
- Maximizing container utilization
Distribution Center Management (DCM) including:
- On-site quality inspection
- Inbound / outbound shipment management
- Warehouse management / consolidation
- Dedicated staff
- Export processing for shipping products directly to international distribution centers
Penske responded to the customer's needs by designing and providing a warehouse that addressed its needs for quality-check, unloading, labeling and shipping, with a comprehensive Distribution Center Management (DCM) strategy that included a dedicated staff for coordinating suppliers. This strategy enabled the customer to conduct quality-checks closer to the manufacturers and reduce transportation costs by avoiding shipping defective product. Additionally, the customer was able to reduce inventory levels through direct shipping to its international distribution centers.
By optimizing its warehousing and distribution systems, this customer increased its flexibility and dramatically grew its base of China suppliers. With our help, they were able to increase the volume sourced from China by 48%, achieve a 16% improvement of container space utilization and a 22% reduction in cost (per piece shipped.)