NRF increased control of supply chain

NRF is one of the leading distributors of heat exchangers and spare parts. The entire European market is supplied with radiators, oil coolers, air coolers, heaters and air conditioning parts from stock. The supply chain includes the central distribution centre in Mill, the Netherlands, and eleven subsidiary stocking locations across Europe. At the beginning of 2007, NRF decided to implement Slimstock’s Slim4 solution to support their Sales & Operations Planning (S & OP). Patrick van Hoek, Logistics Manager, was very pleased with the outcome: “We can now control the service levels.”

The Netherlands Radiator Factory (NRF) is much more than a factory, says Patrick van Hoek. “Half of the turnover is generated by ready-made radiators and air conditioning components which are purchased worldwide and distributed across Europe. Most items now manufactured in the Netherlands are either small series or specials.” NRF supplies in the aftermarket environment, where it is critical to be close to the client. That is why there are eleven locations, as well as the central distribution centre in Mill, spread across South, Central and Western Europe, all of them holding their own stock.

To be able to tighten the control of their supply chain, NRF decided to reorganize their S&OP process in 2007. In order to achieve this, Slimstock’s inventory optimisation tool Slim4 was integrated with their Microsoft Dynamics AX ERP system. “Previously, inventory planning was not very well structured, resulting in excess stocks.

Statistically based forecasts

Deciding to go with Slim4 was easy, our inventory managers were used to going through thousands of items every week and placing orders based on experience and gut feeling. We wanted a system that could provide statistically based forecasts and functionality designed to manage by exception. Slim4 is based on these principles.

Within four months Slim4 was delivering results in Mill and we began rolling the implementation out to the subsidiary branches. After that it was a piece of cake. Now the daily sales and inventory data is sent to Slim4 and we are continuously coordinating stock with the local sales organisations on the basis of management by exception. Slim4 automatically calculates the quantity of stock required. The implementation initially caused some suspicion amongst the managers of the branches, but seeing is believing, and now they are all very satisfied. The entire S&OP has become a smooth process.”

Optimised stock

The stock managers now have much less stress and the order advice from Slim4 is now trusted most blindly. In addition, the amount of obsolete stock has substantially declined. Also, if someone is on annual leave for a week, the cover is much easier to arrange. Van Hoek: “The most important advantage is that we have much more visibility over what is happening. We know where the stock is and whether we are performing above or below the norm. Crucially, we now control the service levels. Thanks to Slim4, availability increased from 88 to 95 percent.”

Patrick van Hoek, Logistics Manager, was very pleased with the outcome: “We can now control the service levels.” NRF increases control of supply chain “Thanks to Slim4, availability increased from 88% to 95%”