Taking the first steps on a TVO journey to drive out cost, release cash and regain competitive advantage
This leading designer and manufacturer of solar panels for commercial and residential purposes had been slow to adapt to a dynamic shift in the market which had significantly impacted its profitability. The company had recently been split into two separate entities; make and install. This process had exposed substantial gaps in terms of people and processes in the new stand-alone organizations. Leadership brought in Maine Pointe to help plug these gaps across the supply chain.
In the first step in the client’s Total Value Optimization (TVO)™ supply chain transformation journey, Maine Pointe focused on reengineering the logistics network. Our goal was to reduce working capital, improve visibility and evaluate whether the client’s last-mile logistics strategy was able to meet changing customer expectations.
Our analysis team confirmed that the company was losing money at a worrying rate. The business was an innovation leader in terms of its products but had failed to apply that same innovation to its supply chain. Leadership’s mindset had not adapted to the changes in the market. Put simply, they were still “selling a Mercedes in a Honda market”. Logistics was low priority and was not data driven and the company was paying premium rates to its 3PL provider but receiving a sub-premium service. Warehouse facilities were overcrowded with little operating space, which was impacting the speed of order fulfillment. In response, rather than consolidating, the organization had plans to add new warehousing facilities. The business needed to change its approach to logistics and adapt to the demands of a direct-to-customer business model.
To help meet this challenge, Maine Pointe:
The impact both in terms of working capital reduction and improved time to service customer orders has already been felt across the organization and has helped cement the partnership between the client and Maine Pointe as they move to the next stage of their TVO supply chain transformation journey.
Working closely with the client’s team, Maine Pointe’s logistics and distribution network experts helped deliver the following benefits:
Incorporated advanced negotiations approach with strategic suppliers to optimize P&L impact and mitigate operational risks