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Case - Reverse logistics process improvement
Challenge
For a top-tier computer manufacturer, Norbridge staff was asked to develop a new returns business design in order to:

  • Cut costs, assets and time involved in shipping, handling, processing, testing and repair of products returning from the field
  • Quantify the business case for change
  • Recommend an implementation plan


Approach
  • Processes were mapped, cycle times were determined and costs were fully modeled across transportation, operations, assets and warehouses
  • Multiple potential returns business models and flow paths were identified and analyzed using the costing and cycle time model developed
  • Intermediate findings were carefully validated with key client executives to build buy-in to ultimate recommendations
Value Added
A streamlined / partial direct returns model was proposed
  • Partial direct-to-vendor returns
  • Reduced inter-site transportation
  • Outsourced testing
  • Reduced staff and facility requirements
$19 million annual cost savings
  • New business model: $12 million (returns processing, scrap, facilities, partial direct return, cycle time reductions)
  • Related initiatives: $7 million (finished goods inventory reduction, freight negotiations)
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