Delivering regional logistics from the world’s most complex Automotive market
For many western organisations the centre of gravity has shifted in recent years. Not only does an increasing percentage of supply originate in the east but demand patterns are also shifting eastwards – and this is having a significant impact on supply chains.
Successful supply chain management often requires the alignment of contradictory needs. Examples include, the need to have inventory close to the customer but to avoid duplicating inventory in multiple locations. Additionally, to provide localised solutions whilst delivering the economic benefits of a centralised solution. These are some of the challenges that faced Jaguar Land Rover in 2008 prior to its entry into the China market in 2009.
After securing the business from Jaguar Land Rover the challenge to Unipart was tough but clear - develop a means of supplying and rapidly growing China and other Asian markets from a single site.
The benefits would be huge:
- Shared centralised inventory
- Consolidated shipments from the UK to a central hub – lower in transit inventory costs
- Reduced lead times from Asia Pacific suppliers into a central hub
- Reduced lead times and freight costs from a hub location closer to markets
- Reduced space requirements in destination markets due to reduced lead times
The solution was the development of an initial 10,000m2 bonded hub in Suzhou, near Shanghai.
In 2008 Unipart quickly relocated a limited number of experienced supply chain professionals to China and commenced the supply chain architecture – the process of designing a new supply chain that is grounded in experience but market specific and local. With any new business or supply chain the use of existing business know how to undertake new activity is a critical success factor – and the use of 20 years of group wide automotive experience to rapidly develop a level of experience in China at a local market cost was a key element in the delivery of the Jaguar Land Rover China supply chain.
Uniparts 2009 China development covered the recruitment and training of a wide range of new staff, systems design and implementation in addition to the physical warehouse development. This was in addition to starting a long term working relationship with China customs that delivers stability and clarity for Uniparts client.
Time moves quickly in China. Not only did Unipart rapidly launch the original bonded and non bonded warehouses in Suzhou in 2009 the growth for JLR in the following years has been exponential.
- 2010 Launch of the first Beijing warehouse
- 2011 launch of the Guangzhou warehouse
- 2011 Commencement of supply to Japan and Korea
- 2011 Launch of the second Beijing warehouse
- 2012 Launch of the Chongqing Warehouse
- 2013 Launch of the warranty core and tyre supply warehouse
- 2014 the doubling of warehouse space in Suzhou to 20,000m2
The physical warehouses are only part of the story though – the delivery of results through these warehouses to a rapidly expanding Jaguar Land Rover Dealer network, that now tops 140 dealers in China, has also been electrifying. Line volumes through the sites have increased by over 45% each year leading to a rapid growth in headcount that now stretches over 300 Unipart staff in China.
And whilst Uniparts development of the Jaguar Land Rover China supply chain is far from over the core principles of developing engaged employee’s, delivering financially and operationally lean solutions via innovative supply chain planning remain at the core of all of Uniparts work in China.