Production and Stores

This area of the business in a typical OEM is where we can have significant impact. If we get our logistics model right then our OEM customer should not have to stock anything except service spares and machine build consumables.

This would normally cause increased order traffic but this is negated by our single line kit ordering process and single shipment delivery, direct to build cell.

Typical Issues

  • Current workload generated by volume of individual deliveries received
  • Incomplete shipments from multiple suppliers delaying build
  • Multiple handling of goods prior to being delivered to manufacturing cell
  • Time taken to kit and sub assembly of products
  • Inventory cost
  • Floor space issues due to machine build delays

Example Objectives

  • Improved flow of materials
  • 1 order, 1 kit, 1 delivery
  • Investigate sub assembly viability to increase build capacity
  • Bonded stock or vendor managed inventory
  • Major administration time savings
  • Significant reduction in inventory value

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Single kit deliveries direct to shop floor

Routeco kitting operations can have a major impact on all aspects of an OEMs supply chain but most quantifiable benefits are achieved in the production and stores area. All kitting operations are designed around a customer`s specific requirement in terms of build schedule, lead times and even available space. Instead of the usual mode of; quote it, buy it, receive it, book it to stores, book out of stores and finally move to point of use. Our kits (and sub-kits if required) and booked in as a single line item and moved to point of use.

Jit deliveries from local service centre    

The bulk of Routeco`s shipments today are made from our Milton Keynes hub that may contain in excess of £10m of stock at any point in time. Today`s logistics mean that it is quite simple to ship to most areas in the UK next day or 2 days at worst. Our local branches are service centres that cater for the requirements of local customers and have specific stock accordingly. This stock may be reserved for a specific customer with an agreed delivery time to ensure JIT deliveries if required.

Sub-assembly of electrical components  

The Routeco Assembly Unit is available to our OEM Solutions customers. As your production will vary through the year you may be in need of an overspill facility or some sub-assembly functions or any repetitive product assembly on an ongoing basis. From the initial concept to full test, we work with our customers to ensure that the design and functionality meet their requirements.

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Bonded stock, VMI or kanban for machine build consumables              

Routeco will commit if required to providing on-site stock of machine build consumables for our customers. These are the items that are typically high volume, low cost components and need careful management to ensure continuity of supply. Evaluation of usage and rate of replenishment will allow us to recommend the best solution to manage these components often using a separate account to allow the cost to be separated from the higher value machine build components.

Major reduction in on-site stores inventory      

On-site inventory can have a major impact financially on any business and the balance between ever changing lead times, cost of stocking and achieving machine delivery dates is difficult to achieve. Our engagement process with an OEM includes evaluation and agreement of recommended stock levels at the local service centre to ensure immediate availability without cost impact on the customer.

Reduction in accounts management time             

A vendor reduction exercise will significantly reduce the number of accounts to be managed by an OEM and all of the issues caused by varying levels of credit limits and payment terms. Some supplier accounts will be transacted by account facilities, some by pro-forma and others by credit card. These can impact severely on supply chain when issues inevitably arise. Routeco can provide a tailored credit limit and negotiated terms that provide consistency and clarity to financial planning.