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Developing Supply Chain Efficiency and Cost-Effectiveness for a Leading Lift Equipment Manufacturer

By Zetwerk Editorial Team


18 June 2024

A prominent manufacturer of aerial lifts, boom lifts, scissor lifts, telehandlers, and low-level access lifts was facing supplier capacity issues, quality control problems, and logistical inefficiencies that threatened their operations. Seeking to streamline their global supply chain and reduce production costs, they partnered with Zetwerk, to address these supply chain issues.

Identifying the Challenges

Supplier Capacity and Intellectual Property
A key supplier’s inability to meet production demand created substantial bottlenecks. Additionally, this supplier held the intellectual property rights for critical components, complicating transitions to alternative sources.

Quality Control
Ensuring consistent quality across a global supply chain with extended lead times was challenging. Quality issues were leading to production delays and increased costs, adversely impacting the company’s market responsiveness.

Cost Reduction
The manufacturer needed to lower manufacturing costs without compromising product quality and performance, necessitating innovative approaches to redesign and sourcing.

Tariff Mitigation
Anti-dumping duties on imports from certain countries required a strategic shift in sourcing to mitigate additional costs and maintain competitive pricing.

Implementing the Solutions

Reverse Engineering and Supplier Development
Zetwerk reverse-engineered critical hydraulic tanks, developing detailed drawings to identify and qualify new suppliers in India. This ensured these suppliers met the required manufacturing and quality standards. The process included developing “first article” samples and managing the qualification process, transferring necessary intellectual property to new suppliers.

Design Optimization for Cost Reduction
Zetwerk collaborated with the manufacturer to convert fabricated components into cast parts. This involved iterative design work and finite element analysis to ensure the new casting met all performance requirements. The redesign consolidated three individual part numbers into one, simplifying the supply chain and reducing costs.

Global Supply Chain Management
Zetwerk managed a global supply chain involving 60 different part numbers from 7-8 suppliers worldwide. This included all supply chain planning activities, building to forecast, warehousing, and just-in-time delivery to the manufacturer’s facilities. Zetwerk’s management ensured a responsive supply chain capable of adapting to demand fluctuations.

Quality Assurance
Zetwerk implemented stringent quality control measures, developing rework processes and localizing standards. They managed quality issues at the supplier level and developed rework capabilities in the US, ensuring that any affected inventory could be corrected without disrupting the manufacturer’s production lines.

Logistics and Warehousing
Zetwerk established warehousing and distribution practices in the US, with facilities in Pennsylvania, Washington, and Nevada. These practices supported just-in-time delivery, reducing the need for the manufacturer to maintain large inventories and minimizing the risk of production stoppages.

Key Achievements

Cost Savings
The conversion of fabricated components to cast parts and the consolidation of part numbers resulted in annual savings of $700,000 for the manufacturer. This redesign also simplified the supply chain, contributing to overall efficiency.

Supply Chain Resilience
By shifting production to India, Zetwerk helped the manufacturer mitigate the impact of anti-dumping duties, saving millions of dollars annually. This strategic move increased supply chain resilience.

Enhanced Quality Control
Zetwerk’s proactive quality management ensured potential issues were identified and resolved quickly, preventing production line shutdowns and maintaining consistent product quality.

Operational Efficiency
Implementing a just-in-time delivery system and strategic warehousing improved the manufacturer’s operational efficiency, reducing lead times and inventory costs.

Zetwerk’s comprehensive approach to supply chain management, including reverse engineering, supplier development, quality control, and logistical support, provided significant benefits to the lift equipment manufacturer. The partnership resulted in substantial cost savings and enhanced the overall efficiency and resilience of the manufacturer’s supply chain. This case study demonstrates how Zetwerk can deliver tailored manufacturing solutions to meet the complex needs of leading industrial equipment manufacturers, driving operational and financial improvements.