New Era Cap’s International Supply Chain was fragmented, not controlled at origin and often incurred additional costs. New Era’s significant growth in International markets put additional pressures on their European distribution centre located in The Netherlands. Therefore the speed in which New Era supplied their customers was slow and causing dissatisfaction within the market, this also meant that multiple transportation costs increased significantly and warehouse operatives became unproductive by over handling consignments. New Era had limited visibility of their product movement without consolidation or equipment utilization resulting in high transportation spend.
Following a comprehensive RFQ, involving 10 global logistics providers, Noatum Logistics and its International Supply Chain team was chosen to provide solutions to challenges New Era faced. New Era recognized the need to take a fresh look at its International operations in Asia and Europe to find a robust, scalable solution, which would work for years to come meeting New Era’s significant growth challenges. Following our appointment Noatum Logistics quickly deployed a project team enabling us to facilitate New Era’s requirements with the global Noatum Logistics offices in Asia, our core service provider such as airlines, shipping lines and contracted 3rd party suppliers.
Noatum Logistics identified a ‘drop ship’ solution to quickly speed up time to market, lower transportation costs, reduce warehouse handling allowing the DC to become more efficient in serving the local western European market. With this approach and with support from the Noatum Logistics’ global network direct freight forwarding services between manufacturing locations in China and emerging markets for New Era such as Russia, Africa, Scandinavia and UAE were identified. This allowed Noatum Logistics to focus on delivering an origin solution that allowed vendor managed consolidations to be transported to specific international locations based on New Era’s purchase order information. Noatum Logistics demonstrated the ability to manage New Era’s suppliers and their purchase orders, improving equipment utilization and cost efficiency. This CFS consolidation model also provided an additional cost benefit by removing LCL shipments and loading them together in full containers.
Shipments would have previously moved through the DC in The Netherlands now have a 10-14 day shorter transit time as a result of ‘drop shipping’ directly to final destinations. The implementation of ‘drop shipping’ decreased New Era’s inbound logistics and handling spend by 30%, subsequent savings and business improvements were quickly identified such as improved cash flow, speed to market, lower cost per unit projections with no further investment required. Noatum Logistics solutions reduced air freight dependency to just 10% of the overall inbound volume meaning 90% of volume is shipped by ocean resulting in significant cost savings.