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1、 Andersen Consulting 1999Electrolux China “Network Strategy” ProjectFinal Report PresentationBeijing, March 10, 1999Page 2n Project Introduction and Backgroundn Customer Survey - Survey Approach - Survey Results - Findings and Opportunitiesn Logistics Network - EOQ inventory modeling - Logistics net
2、work modelingn Recommendations and next stepsn Appendices- Process flow- Cost analysisContentsPage 3Major Brands Market Share in 1999Page 4Electrolux ObjectivesElectrolux ObjectivesReduce working capitalIncrease turnover (through greater product availability)Reduce operating costsElectrolux China ha
3、s committed to achieve Best Practice Service and Cost, as basis for rapid business growthhigh inventory carrying cost in-store stock-outs too many warehouses: limited inventory and service control: SOP systems and procedures for inventory control are not systematically in place/applied limited know-
4、how and support unclear responsibilities and performance criteriaElectroluxs supply chain objectives. are to improve current performance. to deliver real bottom line benefitsElectrolux China has identified supply chain improvements as one of its corporate priorities to improve customer satisfaction
5、and cost performance.Satisfy requirements of target customers (better than competition)Achieve full control of the entire logistics processLimited visibility and control, appropriate perforrmance criteria not in placeLikely gaps in service satisfaction. Required Service Levels and competitors positi
6、on are not measuredPage 5The overall objective of Electrolux China Network Strategy Project is to optimize the distribution network configuration in terms of: - Meeting customer service requirements;- Achieving minimum costs; and- Controlling the entire outbound logistics process. Increased Revenue
7、- Improved product availability and promising capabilities - Scalability to meet future business requirements. - Improved responsiveness to market conditions. - Optimized fill rate capability. - More flexible, responsive delivery options - More value-added services. Reduced logistics costs - Improve
8、d end to end supply chain visibility - Lower cost-to-serve in transportation and distribution Improved asset productivity - Fewer stock locations through rationalization to achieve higher network productivity Reduced working capital - Lower LDC stocks through more flow-throughs, smaller more frequen
9、t orders, centralized slow movers, better use of supplier stocks etc.EXPECTED RESULTSPROJECT OBJECTIVE:Page 6The overall objective of Electrolux Network Strategy Project is to determine the least cost distribution network configuration to satisfy the specific service level requirements of its curren
10、t and future target customers Project Objective and ScopeProject Objective and ScopeThe scope of the Network Strategy Project is to answer the following questions:The scope of the Network Strategy Project is to answer the following questions: What are the customer service requirements which impact c
11、hannel design, logistic process and infrastructure? What is the current performance (performance measure and customer satisfaction) of Electrolux in meeting these requirements and what is the GAP versus the competitors as well as against the “Best Practice” achievable in China? Should Electrolux pro
12、vide inventory carrying and transportation services to our clients (with appropriate price increase)? What other additional logistic services can provide competitive advantage to Electrolux in the market place? Should Electrolux change the structure of its distribution channels in China (e.g. sales
13、to retailers, vs to distributors?) Can Electrolux gain by plant direct shipping? How many distribution centers (DCs) should Electrolux have? How many RDCs and LDCs? Where should the DCs be located? Which types/location of customers and which branch should be served by each DC? Which customers should
14、 be served directly? Should all DCs carry all products or should they be specialized by product line? Should Electrolux contract for warehousing services or operate its own DCs? What impact do different transportation modes have on Electrolux logistics network requirements? What inventory control pr
15、ocedures (high level) should Electrolux establish in order to satisfy customers, minimize cost and maintain control? What are the systems and human competencies requirements to achieve these objectives?Page 7In developing the optimum supply chain capability for Electrolux China we are utilizing a th
16、ree-phased approach to developing and rolling-out the new distribution network - This project covers only Phase IOverall Approach towards Network OptimizationOverall Approach towards Network OptimizationPage 8Build Logistics ModelTask 5Assess AlternativesTask 6Conduct Review SessionsTask 7Present Results, Recommen- dationsthe service skills and attitude of after-sales personnel which nee
