Source: SupplyChain Management Review
Annually, the Automotive Industry alone loses billions of dollars due to supply chain mismanagement. For most, the deficit is credited to losing between 16 and 18 percent of reusable packaging assets.
The multi-billion-dollar problem in the Automotive Industry is indicative of an issue with the current state of supply chain management across all industries. Simply stated — the status quo of supply chain management has been outgrown.
For Honda of America Manufacturing, Inc., the status quo became too costly and inefficient to sustain. As their supply chain grew, they faced new problems — lost containers, a general lack of visible assets and the financial burden of the earlier-mentioned.
Like many others, Honda of America’s supply chain was threated due to inefficient handling of returns to the supplier. When a returnable pack was unavailable, the supplier would resort to using corrugated boxes, which cannot be reused, efficiently stored or loaded into trucks.
On some occasions, the supplier would have to expedite the shipment of reusables back to the supplier. These practices —which are congruent across all supply chains — were costly and unsustainable.
Surgere — the developer of the web-based community AutoSphere — was the innovative solution for Honda. “The benefit is going to be obvious. As this digital age continues to mature,” Roger McIntyre, department manager of material service with Honda of America said, “our suppliers are going to see the benefit and start driving up into the Tier 2’s and 3’s.” Continue reading.