NewStream's Commercial Packaging Solutions Achieve Rapid 75% Backlog Redution for Agricultural OEM
Background
A leading agricultural original equipment manufacturer (OEM) faced peak season challenges that required support from a commercial packaging solutions provider. Their newly-built Midwest parts distribution center (PDC) was struggling with capacity constraints, resulting in a significant backlog of packaging work orders and stalled customer order fulfillment.
This case study explores how NewStream Enterprises transformed this burden into a substantial win for the original equipment manufacturer. Our single part packaging solutions showcase the power of strategic partnerships and innovative solutions in supply chain management.
Why Choose NewStream?
NewStream Enterprises is a third-party logistics company based in Springfield, Missouri. Our central location and decades of experience provide us unique insights into the pain points of original equipment manufacturers. From part shortages to shipment delays, we bring both solutions and empathy to the table for our business partners.
Agricultural OEMs face significant challenges during peak seasons, particularly in managing order fulfillment and inventory. The seasonal nature of agricultural operations intensifies the demand for equipment repairs and maintenance, straining dealership resources. During these critical periods, every hour counts for farmers, and any delays in parts delivery or incorrect shipments can be costly and damage the OEM’s reputation.
Common Pain Points for Agricultural OEMs
- Significant spikes in order volume, overwhelming fulfillment operations
- Increased shipping demands, putting pressure on delivery timelines
- Limited warehouse space, constraining inventory management
- Potential for mishandling and mispicking of parts, leading to operational inefficiencies
NewStream emerged as the ideal partner for the agricultural OEM. We’re renowned for our flexibility and scalability, vital for adapting to fluctuating demand during peak seasons. Our expertise in warehouse utilization and overall supply chain efficiency allows us to reduce packaging turn time from two weeks to just three days.
By partnering with NewStream, the agricultural OEM had the opportunity to alleviate capacity issues, reduce backlog, and focus on core operations. Keep reading to explore how we achieved this operational win for our customer.
The Challenge
The original equipment manufacturer’s primary distribution center was unable to keep pace with the demands of their busy season. This bottleneck resulted in:
- Mounting backlog of unresolved packaging work orders
- Delays in customer order fulfillment, impacting satisfaction
- Strains on the distribution center’s resources and staff
The Solution
NewStream took a comprehensive approach to our client’s concerns. We thoroughly reviewed the issues at hand and communicated with the agricultural OEM to develop a strategy.
Initial Assessment and Planning
After on-site discussions at the OEM’s PDC, the warehouse team visited NewStream’s kitting and packaging operations in Springfield, Missouri. Impressed by the processes, flexibility, technology, and culture within NewStream’s warehouse, a plan was devised to reroute backlogged packaging work orders to NewStream.
Rapid Implementation
Within two weeks of the Springfield meeting, NewStream began receiving trucks from the original equipment manufacturer. The operation quickly scaled from one truck per week to one per day, with NewStream establishing a dedicated carrier to maintain optimal material flow.
Expanding Services
As the partnership progressed, NewStream’s role expanded to address additional challenges.
- Kitting for Sales Promotion: When the OEM needed specialized kits for a North American sales promotion, NewStream’s kitting and packaging team delivered with a remarkable two-day turnaround.
- Packaging Engineering: NewStream’s in-house team took on the task of writing packaging specifications for the majority of the OEM’s products, leading to improved warehouse utilization at the Midwest distribution center.
The Results
The partnership with NewStream led to rapid improvements despite ongoing vendor fill rate challenges. Here’s what we achieved.
- A 75% decrease in the backlog over a 60-day period.
- A 4X increase in volume in the first two weeks.
Efficiency Gains
- Volume Increase: NewStream quadrupled processing volume within the first two weeks, significantly easing backlog issues during the peak season.
- Turnaround Time: Packaging turn time was reduced from over two weeks at the OEM’s location to just three days at NewStream.
- Labor Optimization: The original equipment manufacturer eliminated its third shift at the Midwest PDC, reducing labor costs.
NewStream is a vital component to our daily performance. I sleep at night knowing NewStream is taking care of my business.”
Key Success Factors
- Flexibility and Scalability: NewStream’s ability to rapidly scale operations from one truck per week to one per day demonstrated exceptional adaptability.
- Comprehensive Service Offering: NewStream provided valuable kitting and engineering services, offering a one-stop solution for the client’s needs.
- Expertise and Technology: NewStream’s advanced processes, technology, and experienced team were crucial in delivering high-quality results.
- Dedicated Logistics: Establishing a dedicated carrier ensured smooth material flow between facilities despite supply chain challenges.
- Rapid Response: NewStream’s quick turnaround on both packaging and kitting projects was instrumental in alleviating the OEM’s backlog.
Long-term Impact and Future Opportunities
The success of this partnership opens doors for future collaboration and continuous improvement. By diversifying its packaging and kitting operations, the original equipment manufacturer solidified their supply chain resilience.
Our established relationship also allows for easy scaling of services during future peak seasons or expansion initiatives. While the agricultural sector always faces unexpected challenges and market changes, we’re committed to the ongoing success of our customers.
Conclusion
This case study demonstrates how a strategic partnership with a specialized service provider like NewStream can transform a significant operational challenge into a major win.
By leveraging NewStream’s expertise, the agricultural OEM resolved its immediate capacity issues and gained long-term benefits in efficiency, cost savings, operational focus, and customer satisfaction.
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