XPO's supply chain aggregation strategy works well in situations ... Using Oracle-based Advanced Planning Systems, XPO C
SUPPLY CHAIN | SOLUTION CONCEPT
XPO.COM
AGGREGATED DEMAND NETWORK
Providing a self-regulating, consumption-based process that ensures optimal inventory levels at all points of the supply chain
XPO’s Supply Chain Aggregation Strategy transforms complexity into opportunity We align with manufacturers and tiered suppliers, funneling data and simplifying material flow to provide a total supply chain solution which consolidates and aggregates the global demand and distribution of the managed commodity. This solution provides a single buying entity, a managed manufacturing base, and managed transportation to drive further value through milk runs and consolidated shipments. This system provides a selfregulating, consumption-based process that ensures optimal inventory levels at all points of the supply chain. Our centralized solution encompasses demand planning, procurement, customer service, and transportation management—all driven by data flow via XPO’s IT systems.
Our solution is flexible and scalable, and is applicable to a wide range of commodities in a wide range of industries
XPO’s Supplier Portal provides complete inventory visibility to all members of the supply chain, including comprehensive inventory position for each part managed. The Portal also serves as a mechanism for entering and receiving actionable data including forecast updates, engineering change notices, advanced shipping notices, and transportation updates. XPO’s supply chain aggregation strategy works well in situations where multiple manufacturing plants are using a common commodity. The results are further enhanced by including Tier I and Tier II suppliers using a common commodity.
CONCEPT OF OPERATIONS | Aggregated Standards Network
Fully integrated supply chain End-to-end management of information and product flow
Aggregated demand forecasts Single, long-term forecast representing demand for all participants
As shown in the Concept of Operations diagram, XPO’s Aggregated Network Stragety integrates data from all touch points of the supply chain, driving sophisticated decision making and automating replenishment.
SC.DOC.112116
Single buying entity One customer, one ship-to adress, one relationship
Managed manufacturing base Measured, accountable, responsive
End-to-end inventory visibility Highly available ISO 27001 compliant environment
Manufacturing Plants and Tiered Suppliers As manufacturing plants and tiered suppliers consume parts, XPO takes a daily snapshot of on-hand inventory levels. Using the daily consumption information along with forwardlooking forecasts, replenishment orders are automatically generated and shipped. Consuming entities are freed from the responsibility of monitoring part consumption and placing replenishment orders. XPO Central Logistics Using Oracle-based Advanced Planning Systems, XPO Central Logistics builds a long-term forecast that is sent to the component part suppliers. This single forecast represents the total demand for the entire supply chain. Component Part Manufacturers Component part manufacturers use this forecast to plan capacity, raw material, and human resources. Product is only shipped to fulfill a replenishment signal, but the forecast is used as a long-term plan to optimally position the company for the coming demand. DC and Transportation As component parts are shipped from the Distribution Center to the consuming entities, replenishment signals are sent to the part manufacturer. Shipments are readied by the manufacturer and staged on their dock for pick up by XPO-managed transportation carriers.
©2016 XPO Logistics, Inc. CONFIDENTIAL AND PROPRIETARY MATERIAL
