Rail Freight solution delivers CNY 2.8 million in the first year of implementation
Our client, a furniture manufacturer in China, was facing significant cargo delays using an ocean freight service. They had difficulty planning inventory and were holding significant buffer stock to compensate for any late shipment arrivals from their ocean freight services. After experiencing fluctuating ocean freight charges and high customs brokerage costs, the client reached out to Crane Worldwide Logistics in the Asia Pacific for a better logistics solution.
Each quarter our client held CNY 10.8 million in buffer stuck, had a total warehouse requirement of 19,376 sq, ft. And ocean freight charges per container cost over CNY 20k. Through a referral from an existing client, Crane Worldwide Logistics partnered with the manufacturing organization to understand the exact warehouse turnaround times. From the data gathered, the team at Crane Worldwide recognized the potential to make adjustments to improve upon the existing challenges.
Our team identified Rail Freight as the ideal logistics solution for our client utilizing Germany to Shanghai Door to Door service. With this mode of transportation, Crane Worldwide Logistics was able to reduce the delivery lead time considerably by thirty days. With predictable arrival times using Rail Freight, the team produced a timeline that identified how long cargo could be held back prior to the purchase order release date. Optimizing the purchase order release date ensured a faster turnaround and reduced buffer stock as well as overall supply chain efficiency.
“Finding the optimal logistics solution to our client's supply chain challenges is critical to building trust. Rail Freight is a great option to consider for China to Europe's transportation needs.”
As a result, our client saved CNY 2.8m in the first year of utilizing the Rail Freight proposed solution. Following the transfer to a reliable Rail Freight service, lead times were reduced and scaled excess inventory down to a minimum. The increase in transportation efficiency as well as improved cash flow and lowering advance duty outlay charges provided the client with significant cost savings.
At Crane Worldwide, we believe in innovation and possibilities, not limitations.