Challenge

3PL Value Delivery Evaluation in Aerospace - A $100B aircraft manufacturer requested support to evaluate a 3PL providing manufacturing replenishment to feed components for wide-body, twin-engine commercial airplane assembly.

Approach & Actions

The evaluation focused on analysis of actual performance in comparison to Service Level Agreements (SLAs) and actual invoiced costs in comparison to pricing for storage, handling and accessorial charges listed in the 3PL service contract. Extensive on-site evaluation of operations and data analysis revealed bad news. The 3PL dramatically increased service costs, nearly doubling over 3 years, while underperforming to service delivery targets despite exaggerated performance reports with 80% average on-time delivery versus 98% reported.

Results

Results caused the client to renegotiate the 3PL service contract and seek recovery of excess billing

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