Improving Inventory Visibility & Orchestration
The Spares Business Unit (SBU) at Mahindra & Mahindra Farm Equipment provides genuine vehicle and tractor spare parts. The team was challenged to profitably manage its high inventory investments.
Mahindra & Mahindra Farm Equipment is the world's number-one tractor company by volume, and its automative business competes in almost every segment of the industry.
With Blue Yonder's Luminate Planning platform, Mahindra & Mahindra increased visibility to over 100,000 SKUs and 21 distribution centers.
The SBU was losing sales revenue due to stockouts and tight working capital as a result of its high inventory investments. The business was relying on manual analysis and Excel spreadsheets to create demand and supply plans, but they were not adequate for the complexity and scale of the challenge. Mahindra & Mahindra was challenged with:
- Warehouse space constraints led to stock availability gaps and turnaround time delays
- Supply capacity constraints that lead to supply quantity shortages and excessive lead times
- Sales push for month-end targets resulted in demand and supply mismatches
- Missed sales targets due to unavailability of required parts; stock pushed from available inventory
- High inventory investments, high stock obsolescence and low customer service
Blue Yonder's Luminate Platform helps Mahindra & Mahindra transform its spare parts supply chain into a source of competitive advantage despite enormous demand variability, elongated lead times, and constantly shifting logistics cost scenarios.
As a result of more accurate forecasting and replenishment, fueled by automation and machine learning, the SBU has been able to eliminate excess inventory and reduce obsolescence costs, while maintain high customer service levels.