Outsourcing Case Study, Bisham Logistics

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Client: Generac Power Products

The Project:
To lead a project to outsource all European logistics and component assembly. To identify possible third party operators. To draw up an ITT and assist in the final choice.

This operating division of a major US based manufacturer was seeking to outsource all its global logistics. Additionally it was seeking to subcontract the component assembly to a third party. Components were imported from a number of destinations in the Far East, Europe and N. America. Assembly was undertaken in a single UK plant and finished product exported throughout Europe in varying drop sizes.
A decision had been made to sell the UK plant and thus it was necessary to implement an agreed solution rapidly. We were asked to lead the project to identify possible logistics partners, draw up an invitation to tender, analyse responses and recommend the correct choice of partner. Additionally it was necessary to seek a company who could provide both a global logistics solution and the assembly operations.

A detailed analysis of the present supply chain and component assembly operations was undertaken. Detailed costings were established. A five year forecast of sales and geographic growth assumptions were factored in. A comprehensive Invitation to Tender was sent to a number of pre-selected companies, responses were obtained and the successful company chosen.

· Final contract negotiations were completed
· A new assembly and distribution centre was established in the Netherlands, with a satellite warehouse in the UK.
· A professional logistics partner has been found, enabling Generac to concentrate on its core competencies · Transport costs have been substantially reduced, particularly in the area of component shipping
· Assembly productivity has grown and costs per unit fallen
· As the operation developed, Generac felt confident enough to allow the Logistics Service Provider to manage component ordering and negotiate directly with the suppliers
· Customer service has improved
· Generac has reduced overhead costs and now concentrates on R&D and commercial activities