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Andy Koch Andy DeVries Elizabeth Smith David Reynolds Outline Introduction Suppliers Forecasting Manufacturing Inventory Transportation Manugistics Deere & Company founded in 1837 world’s leading producer of agricultural equipment international, 160 countries 37,000 employees

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Andy Koch Andy DeVries Elizabeth Smith David Reynolds

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Presentation Transcript


  • Andy Koch

  • Andy DeVries

  • Elizabeth Smith

  • David Reynolds


Outline

  • Introduction

  • Suppliers

  • Forecasting

  • Manufacturing

  • Inventory

  • Transportation

  • Manugistics


Deere & Company

  • founded in 1837

  • world’s leading producer of agricultural equipment

  • international, 160 countries

  • 37,000 employees

  • $13 billion in sales last year


5000 Ten Series

  • general utility, agriculture, landscaping, grounds care

  • costs about $24,000, sells for $30,000

  • produced only at Augusta plant


5000 Ten Series

  • majority of orders are custom orders

  • major competitors are Caterpillar and Case-New Holland


Supply Chain


Suppliers

  • 200 different suppliers for one 5000 Ten series

  • 5 from Asia, 10 from Europe, the rest from North America

  • total parts cost is $20,000 divided equally among the three continents


Suppliers

  • all orders from Asia and Europe sent by ship with a 2 week lead time

  • orders from North America arrive exclusively by truck within 1-3 days


Forecasting

  • production forecasting based on last year’s stock sales and customer orders

  • numbers are applied to a forecasting software called Demand Management

  • numbers are constantly updated and an MRP is run every Sunday night

  • final data is automatically sent to suppliers


Manufacturing

  • plant located in Augusta, GA

  • location chosen due to close proximity to Charleston, SC and Savannah, GA

  • 206,000 square feet used only for production of 5000 Ten series

  • an average of 60 tractors produced per day


Inventory

  • only parts inventory, no completed tractors are kept at the plant

  • completed tractors are only held until a full truckload has been produced

  • the safety stock level for overseas parts is 2 weeks, 3 days for North American parts


Inventory

  • completed tractor inventory exists at dealers

  • every stock tractor is financed for 6 months

  • a stock tractor spends an average of 3 months at the dealer before being sold

  • last year’s ending inventory was 5,569

  • last year’s sales 16,003 tractors


Transportation

  • 2 distribution centers located in Rock Island, IL and Camp Hill, PA

  • all completed tractors delivered in North America by truck, all sent overseas by ship

  • a full truckload is 4 to 5 tractors

  • LTL’s make up less than 3% of shipments


Transportation

  • Deliveries within 200 miles are charged a flat rate

  • additional mileage is billed per mile

  • tractor are sent directly to dealers 75% of the time

  • the other 25% are sent to a distribution center and usually combined with other products


Manugistics

  • This proposed system will consolidate trips to dealers and suppliers

  • Manugistics Transportation Management manages planning and load building at remote locations

  • creates a unique network by integrating the inbound/outbound/international logistics network


Proposed logistics situation

Dealers

Units

Suppliers

E-commerce


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