When a Tennessee-based manufacturer of industrial-grade tools and equipment decided to close its Canadian Distribution Center (DC), it thought it had a workable solution in place to ensure adequate inventory levels to meet the needs of its growing customer base. However, the manufacturer soon learned that it had misjudged the volume of inventory that would be needed. Rather than reestablish the DC, the company turned to Purolator for help in finding a solution. Purolator came through with a unique LTL solution that ensures adequate inventory levels to warehouses across Canada. Today, the company enjoys a highly efficient, streamlined distribution process and the peace of mind of having sufficient inventory in place to satisfy customers.
The challenge
This manufacturer has built a global reputation for producing high-quality, durable products. When the company introduced its portfolio of brands to the Canadian market, the response was very strong. The manufacturer developed what it felt was an appropriate transportation and distribution plan, but as it quickly learned, without a solid plan to keep its network of warehouses stocked, that goal seemed beyond its grasp.
The manufacturer soon faced the problem of chronic inventory shortages. Inventory never seemed to be in the right warehouse at the right time, nor could it keep up with demand. The company was sending nearly full truckloads from its Nashville warehouse, but more than half was going directly to satisfy back orders. In other words, there was an ongoing inventory shortage, and the manufacturer couldn’t seem to find a way to get ahead of its inventory needs.
This is certainly a nice problem to have, but the manufacturer was concerned that customers would soon lose patience. The manufacturer realized a change needed to be made but needed help finding the right solution.
Products leave the Nashville warehouse each day via an LTL (Less-than-truckload) freight pickup. On these trips, shipments share truck space with products from other companies, which significantly reduces freight costs.
At our processing center, larger combined shipments are created to clear customs as a single unit. This smart consolidation reduces clearance costs, border wait times, and administrative complexity.
Products are brought to Purolator’s Distribution Center in Ontario. From there, shipments are sent to the manufacturer's warehouses as needed, while a reserve supply of inventory is held back, acting as a virtual DC for the client.
Our unique Beacon portal system allows the manufacturer's data systems to integrate directly with ours. This provides seamless visibility into where inventory is located and when it's needed, allowing for precise and timely deliveries.
The results
Purolator’s freight solution, along with use of its Martin Grove DC, solved this manufacturer’s inventory management problem. The company no longer faces a perennial backlog, and talk of reopening its Canadian DC has fallen by the wayside.
The company recognizes, though, that Purolator’s solution was only possible because of its deep entrenchment within the Canadian market. Few, if any other, U.S.-based carriers could provide access to a Canadian DC or courier services to seamlessly transport inventory across Canada.
The manufacturer is pleased by its highly efficient Canadian operations and very satisfied to have successfully eliminated its own Canadian DC.
“We knew pretty much right away that we could provide a better solution,” says Betty Jo Rodey, Purolator International’s Strategic Account Executive. “No one else has the access to the Canadian market that Purolator does, so we went to work to deliver the solution this company wanted in the first place.”
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Chronic inventory shortages can damage your brand’s reputation. We can help you design a custom distribution strategy that keeps your Canadian warehouses stocked and eliminates back orders for good.
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