15% off spare parts distribution in Europe, with service restored

A multi-billion dollar manufacturer of semiconductor equipment, running a European spare parts distribution network of a main Amsterdam hub and 4 smaller depots in Dresden, Milan, Lyon, and Dublin.

Semiconductor. Down tools can cost the customer well over $100K per hour, response time is measured in hours not days, and forward positioning spare parts in local depots to support aggressive service level agreements is critical.

The management structure was analyzed to determine the benefits of an internal and outsourced structure. An outsourced model was confirmed to be the best configuration, driven mainly by the low volume of transactions.

The overall requirements for an outsourced partner were developed and included both tangible and intangible factors: 24/7 access, controlled environment, EDI connectivity, company owned, cross cultural understanding, flexibility. Following extensive discussions to identify and qualify the leading European providers, multiple site visits and contract negotiations were conducted in the selection of a new 3PL partner.

A detailed relocation project plan was developed and all depots were relocated over a two month period, which is the part of a 3PL change where service usually breaks.