How a leading electronics company is elevating its supply chain by harnessing speed to market.
Introduction
In the hypercompetitive technology industry, time is of the essence. For high-tech companies, speed to market can make all the difference between a good quarter and a great one. An actionable integrated logistics strategy can give businesses more speed to respond to market dynamics than their competitors and positively impact their top-line growth.
The customer
Our customer is a world leader in home electronics with a presence in over 65 countries. The company’s footprint in Asia-Pacific has grown rapidly over the years, and the region serves as a significant manufacturing hub. Along with an annual growth of 15% since 2020, a surge in demand during the United States (US) and Europe holiday season last year created an urgent need to ramp up their delivery capabilities to different target markets.
The challenge
Led by the Christmas and New Year shopping season, there was a spike in demand for home electronics. Prime markets saw a jump in e-commerce sales in the fourth quarter of 2021, with the US alone witnessing a rise in e-commerce shopping by more than 9%. During this period, our customer was one of the most sought-after brands. They saw a surge in need for air freight with a short lead time from their bases across Asia-Pacific to different local markets and faced various issues across the supply chain due to this increase in demand. *
Firstly, the production side was already affected by a lack of raw material. Secondly, our customer had previously worked with multiple logistics partners, who faced significant capacity challenges. Thirdly, they were faced with reliability challenges wherein delivery slots were not honoured. The home electronics company was also hampered by delays caused by capacity and reliability challenges.
*Source: Digital Commerce 360, February 2022
The solution
When the customer approached us for an effective solution, our local and global Maersk teams sprang into action. The substantial export volumes called for a reliable and agile solution executed in a highly synchronised manner. We provided the customer with multi-mode transportation options that allowed them to reach target markets within Asia and get an additional gateway to reach global markets.
Through a combination of intermodal cross-border trucking and air freight, the customer could transport the manufactured goods by flexible allocation of shuttles between manufacturing sites and the airport that also accommodated any last-minute contingency. We could then fly the cargo out to the different worldwide locations for final distribution. Maersk also set up EDI (Electronic Data Interchange) connections, which helped us consistently send the customer various shipment milestones.
Our team helped set up a single point of contact across the various modes of transportation, through a seamless customised solution. More importantly, our customer was able to have complete control and end-to-end visibility over the different routes and overall lead times.
The result
Our team’s prompt implementation enabled our customer to move all their cargo within the desired timeframe. One of the key wins was that we were able to reduce trucking time to under 5 hours (from manufacturing site to their export gateway), while providing greater flexibility for the customer’s transport planning. This allowed for more efficient cargo movement, particularly during air freight capacity crunches.
The intermodal trucking and air solution also helped open a secondary corridor for the customer. Due to the integrator strategy, they are now able to cope with higher order volumes and route extra shipments through a key regional airport with ease. The customer also has complete control over lead times, which led to continued success in the first quarter of 2022. The model is still in use and is predicted to provide additional time savings through the rest of the year.
Move your supply chain to the fast lane
Speed to market has become an essential part of most major value chains. In an age affected by volatility and disruptions, it’s an indispensable asset that adds a much-needed impetus for technology companies looking to stay ahead of the competition and grow loyalty among consumers.
If you’d like more information on how to add resilience and efficiency in your supply chain, please feel free to contact your Maersk sales representative or reach out to us directly. Get in touch.
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