Case Study
Commercial Vehicle Spare Parts Distribution
Universal Components are leading distributors of truck and trailer spare parts. They were part of RAC plc (formerly Lex Group) and, for 5 years previously, enjoyed the benefits of the group's very effective inventory optimisation system. However, a management buy-out meant they needed to implement their own IT systems. Unwilling to forgo the benefits of an inventory optimisation solution, but unable to stretch to the six-figure cost of the system used by RAC in their new guise as a SME, Universal Components selected Inventory Strategy Manager to complement their new ERP system.
Order Fill Rate Increases by 15%, Stockholding Reduces by 18%
Inventory Strategy Manager went live in April 2005 with the aim of simply matching the performance of the previous system; the achieved results are listed below:
| Date | Stockholding | Notes | |
| - | - | Inventory Strategy Manager goes live | |
| +10% | +5% | In the short term, extra stock to meet new service levels arrives before excess stock of other products is sold | |
| +15% | same | Extra stock of long lead-time products arrives; sales of excess stock now balance stock increases | |
| +15% | -10% | Order fill rate maintained, excess stock continues to decrease | |
| +15% | -18% | As above | |
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Universal Components have grown strongly since their management buy-out, acquiring European Truck & Trailer and OSL (seal division) in 2005, Pollard Beaumont in 2008, and Abal in 2009 to become the market leaders.
With each acquisition, Inventory Strategy Manager was first integrated with the incumbent ERP system to realise immediate service level increases and stock value reductions before the acquisition was fully integrated and Universal Components' main ERP system (which already utilises Inventory Strategy Manager) rolled out. On average, each acquisition's service levels have improved by 7 percentage points while stock value has decreased by 44%. |
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Logistics Manager Magazine published a case study on the Universal Components implementation, which was based on the performance to July 2005 (published in the October 2005 edition).
Read the Universal Components case study
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