Chabot Wallpaper Analysis
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Transcript Chabot Wallpaper Analysis
Chabot Wallpaper Analysis
Cavanaugh, Dunn, Powell
1
Agenda
Introduction
Manufacturing
Transportation/Service
Inventory
Summary
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
2
Major Problems
Long production runs
Poor service from contracted carrier
High inventory levels
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
3
Manufacturing
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
4
Streamline Manufacturing Process
Postponement at the Tennessee
manufacturing plant
Hold inventory earlier in the supply chain
◦ Work in Process vs. Finished Goods
Helps to create a more responsive supply
chain
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
5
Current Manufacturing Process
Introduction
Receive Order
Packaging
(1 day)
Prepare
Substrate
(21-28 days)
Printing
Pattern/Design
(2 days)
Apply Paste
(1 day)
Change Over
Line
(12 hours)
Manufacturing
Transportation/
Service
Inventory
Summary
6
Proposed Manufacturing Process
Introduction
Prepare
Substrate
(21-28 days)
Packaging
(1 day)
Apply Paste
(1 day)
Print
Pattern/Design
(2 days)
Receive Order
Changing Over
Line
(12 hours)
Manufacturing
Transportation/
Service
Inventory
Summary
7
How To Improve Lead Time
Manufacturing Process Lead Time
25.5 days
Current Process
3.5 days
Proposed Process
0
Introduction
Lead Time
Variation in Lead Time
7 days
10
20
30
Time (Days)
Manufacturing
Transportation/
Service
40
Inventory
Summary
8
Transportation/
Service
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
9
How To Improve Transportation
FOB Destination/Freight Prepaid
◦ Change freight terms to FOB Origin/Freight
Collect if customer’s transportation is cheaper
Build relationships with more than one
carrier
◦ Contingency planning
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
10
Inventory
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
11
Inventory Solutions
ABC Analysis on item turnover rates
◦ Reduce case sizes for B and C items
◦ More responsive supply chain enables us to
ship more A items to keep up with demand
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
12
ABC Analysis
Turnover Rates of Items
7
5
4
3
2
1-2 Turns
5-6 Turns
Turns Per Year
6
1
0
Top 20%
Introduction
Next 30%
Items
Manufacturing
Maximum Turnover
Minimum Turnover
<.5 Turns
Bottom 50%
Transportation/
Service
Inventory
Summary
13
Tradeoffs
As case sizes decrease…
◦ Packaging and handling costs increase
◦ Customer service levels increase
◦ Obsolescence costs decrease
◦ Inventory costs increase for Chabot, but
decrease for retailers
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
14
Summary
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
15
Summary
Postponement is key to increasing customer service
◦ Lead times will decrease
Improve carrier strategy to be more responsive to
customer needs
Reduced inventory levels lead to better customer
service
Customer service is at the heart of everything you
do
Introduction
Manufacturing
Transportation/
Service
Inventory
Summary
16
Questions
17