5.10.05

Supply Chain Strategies to save costs

Supply Chain Strategies to save costs

Outsourcing supply chain functions can enhance:

• Cost reduction (10-20%)
• Efficiency
• Customer satisfaction
• Revenues and
• Competitiveness.

One manufacturer was able to reduce its inventories by USD 1 billion, cut down on inventory holding costs by USD 124 million and reduce delivery times to dealers by 26%.

Major areas where supply chain costs need to be reduced are:

Order management costs: By combining order management and parcel traceable programs
• Material purchasing costs: Reverse Auctions
Inventory holding costs: Less than 10 percent of total supply chain costs
• Overall supply chain costs including Supply chain planning costs, and supply chain IT savings