2 Speed Supply - Case Study
Thursday 24th May 2018

The 'two speed supply chain' had been talked about, but not realised.

In essence too many supply chains concentrate more on planning than reaction.
It's a pretty robust balance - nobody minds (or would even notice) if it's 'slightly wrong'.

Too often, it's not even in the right ballpark.


What has changed?

I don't know if this is associated with the supplier base shifting to Low Cost Countries, with associated long lead times. If it is, the old tools won't work.

Too many things change while the goods are in transit. What was thought to be urgent when it was ordered no longer is. And vice versa.

It's worth stressing that this has nothing to do with the accuracy or inaccuracy of the demand forecast.

Or supplier quality; or manufacturing batch size (unless either of those change). It's just the way that luck works over long lead times.

It turned out to be possible to:-

  1. Fast track all urgent goods. 'Today's urgent goods today' should be the catchword.
  2. Launch new products 'range complete'
    • New products are assumed urgent unless flagged otherwise
  3. Still get non-urgent goods there on time.

There is a small increase in stock, essential to 'clear the decks' when a slug of urgent goods land.
It turns out to be a much smaller increase than some had predicted. But an increase it most certainly is.

In passing we couldn't help but realise what a stupid place Felixtowe is for our prime port. Container ships pass Plymouth - with good rail links - and steam at the speed of a milk float past the UK population.

Very interesting. Please contact us

Trying to reduce stock often fails. Increasing Service Level usually reduces stock and increases profit. Go figure.
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