Potential for enhanced transport logistics at Whirlpool Sweden AB
Whirlpool’s transport costs on inbound materials from Europe and Asia have increased significantly in recent years. Some causes of this problem are increased oil prices and the fact that Whirlpool has gained a number of suppliers sited in China. As transportation costs are added on to every produced oven, it is imperative that these costs are reduced so that Whirlpool can retain its role as the leader in the market of microwave ovens. The purpose of this assignment is to analyze possible solutions to reduce the transport cost. The following solutions are suggested:
• Ascertaining the optimal amount of safety stock for each article in order to reduce the number of air transports (which are costly).
• The costs associated with keeping stock in the warehouse are identified so that the entire logistics cost can be evaluated. This information is vital when writing new contracts.
• Information related to logistics such as means of transport and delivery condition should be included in the contract and kept in the system. The information should also be available to logistical personnel, which helps to take fast actions.
• Articles which are dispatched by suppliers sited in Northern and Western Europe and weigh more than approximately 100 kg should be collected by the existing carrier, Ewals. With that, the load capacity is maximized and the articles are transported economically.
• Articles dispatched from Hong Kong at the same point as another supplier which dispatches FCL (Full Container Load) should be loaded into the same container if at all possible. Consequently the articles are transported free of charge and Whirlpool could see significant savings.
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