Supply chain management for a lighting manufacturer
Nelson Miller Group has taken the stress out of supply chain management for a major lighting manufacturer, providing eight years of white-glove service. NMG manages 300 active SKUs, ranging from magnetic components to IM plastics, finished goods, cables, flex conduits, and metal casing. Our custom supply chain solution has reduced costs and freed up internal resources for the manufacturer to focus on their core competencies.
The company
A multi-billion-dollar lighting manufacturer that produces various lighting devices such as controllers, sensors, panels, switches, LED drivers, gateways, and converters. It operates on an international scale and delivers its products to contractors, distributors, and large retailers.
The product
A customized supply chain including everything from sourcing, design, and manufacturing to assembly, inventory management, and warehousing.
The industry
Lighting
Manufactured components
LED driver
Magnetic components
IM plastics
Cables
Flex conduits
Metal casing
Results at a glance
Cost reduction
Access to manufacturing capabilities
Supply chain reliability and continuity
Strategic sourcing on a global scale
Complexity reduction
High quality performance and consistency
Improved lead time
The challenge
Single sourced and lack of supplier diversification
- Relied on a single supplier for some magnetic components utilized in the light production process.
- Wanted to diversify its reliance on a single supplier to achieve an increase in gross profit margin and a reduction in cost per part.
- Limited negotiating power due to being sole-sourced.
- Increased risk of business interruption related to supplier problems.
- Profoundly complex procurement process due to sourcing and inventory management control required.
- Inefficient and cost-prohibitive supply chain because of overreliance on small number of suppliers.
The solution
NMG provided supply chain stewardship and a lean operating strategy.
Reduced complexity
- Created custom supply chain solution with JIT delivery, safety stock, warehousing, and coordination with customer’s 3PL and freight forwarding partners.
- Reduced overdependency on suppliers.
- Simplified the procurement process while obtaining sustainable cost reduction.
- Leveraged NMG warehouse for some components to help simplify the process while guaranteeing JIT.
- Provided single point of contact for project management.
- Implemented flexible production runs for each part - from just 50 parts per month to 100’s of thousands of parts per month.
Expansion of AVL
- Expanded AVL on key parts for better cost, quality, and availability.
- Identified a more reliable source to manufacture 4 magnetic components, eliminating a sole-sourcing situation and realizing a 12% cost reduction.
End-to-end support
- Provided top-of-the-line customer care, with a dedicated Account Manager and Customer Service Representative, routine headquarters visits, and reliable assistance.
Cost optimization
- Freed up cash flow and prevented line-down risks.
- Sourced favorable terms to improve mobility and operational cost-efficiency.
The results
A streamlined supply chain, reduced costs, and operational efficiency
Eight years later, NMG manages over 300 active SKUs on our customer’s supply chain and the customer continues to leverage NMG to provide positive PPV for its business and supply chain stewardship:
- Overhead costs reduced by simplifying and managing the entire in-house assembly.
- Assurance of supply has improved: all SKUs, as well as coordination with their 3PL, are handled via Nelson Miller Group’s state-of-the-art ERP system, enabling faster reliability and reaction time to variations in quantity.
- Time and cash flow freed up for customer to focus on its core capabilities and deliver maximum value to its customers.
- DFM process simplified, including assembly and packaging.
- A superior rate achieved on the manufacturer’s quarterly scorecard while providing white glove customer service.
- Regular on-site visits from with stakeholders including engineers, sales managers, and supply chain leaders to stay up to date on our customer’s current needs and pain points.
About NMG
NMG has more than 85 years of experience partnering with organizations to bring their industrial, IoT, lighting, medical, telecommunications, consumer, and aerospace products to life. We solve your most complex challenges in engineering design, manufacturing, and supply chain management.
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