Second largest third-party logistics company greatly improves accuracy, efficiency and customer efficiency with Honeywell Logistics Solutions

With operations in over 178 key cities in more than 60 countries and regions worldwide, one of Honeywell Logistics Solutions largest third-party logistics (3PL) customers provides their customers with professional transportation, warehouse, freight forwarding and other general logistics services.

This 3PL is now the second-largest logistics company in Japan and also a Global 500 company. They provide quality logistics services to hundreds of foreign enterprises including HP, Sharp, Toshiba, Intel, Panasonic, 3M, Epson and other Global 500 companies.

What were our customer’s requirements?

As its business continued to expand, there was a need to establish a uniform and standardised operating procedures. This extended to eliminating manual operations where possible to increase efficiency and standards of output.

Improving work efficiency and data accuracy also became a key priority for them as customer service managers spent a significant amount of time on spreadsheets processing operational data. Statements provided to customers were manually compiled and were in different shapes and sizes. This not only created inefficiencies but also presented an unprofessional image.

Finally, our customer manages multiple cargo owners, with warehouses carrying up to 10,000 kinds of products. However, the management of the warehouses and operations such as put away and picking relied on the experience of senior workers, with little assurance for the precision of its inventory level. There was also no meticulous management of transportation resources and costs, resulting in high operational costs. These issues resulted in management staff based at their headquarters being unable to understand inventory and transportation status.

How did we meet our customer’s order?

To improve the efficiency for its logistics management and service capability, our customer initiated the development and promotions of its nationwide logistics information system and chose Honeywell Logistics Solutions as its strategic partner.

For a logistics company which operates as a group with a wide-ranging network, it needed to manage every single aspect of its logistics operations through a Warehouse Management System (WMS) and Transportation Management System (TMS). This is why we recommended the integration of HLS WMS and HLS TMS into their operations as it would help drive operational efficiency, as well as establish complete management of its logistics centre.

We began with a trial deployment of HLS WMS in the Shanghai warehouses, with the deployment of WMS to logistics centres nationwide within the following two years. The system enhanced operational efficiency and accuracy of inventory at logistics centres at various locations, thereby achieving transparency of dynamic inventory status and end customers.

With HLS WMS, our customer experienced smooth and systematic receiving, put away, picking, shipping and inventory management within all regional distribution centres (RDC). For key operations, the use of barcodes and radio frequencies were used, which further improved operational efficiency and accuracy of inventory as well as automatic settlement of warehousing costs.

HLS WMS also met our customer’s operational requirements by providing support for multi-owner management, as it is capable to meet the individual needs of several hundred cargo owners. The system also supported management of multiple networked, warehouses configured operational rules and processes, and defined inventory structure, delivering a precise verification of costs.

With HLS TMS, it enabled our customer to achieve full-process deployment and tracking during transportation and established a performance appraisal system for external contractors. The new system allowed for acceptance of transportation assignments, deployment, and status tracking to manage the implementation status. It also provided a statistical analysis of expenses incurred and gross profit for each assignment via the verification of receipts corresponding to the transportation assignment and management of accounts receivable and payable.

Last but not least, the implementation of an order tracking system and establishment of an order tracking platform provided their customers with more transparency on information regarding their orders. Logistics monitoring and tracking were conducted in the data centre of the head office. Data on inventory in the respective Distribution Centres and status of orders in transit were all centralised to allow the head office to have full visibility of the supply chain.

What was the end result?

By establishing a complete logistics information system with HLS WMS and HLS TMS for our customer, we were able to solve the problems of front-line operations and enabled accurate data resources. Logistics monitoring reinforced the head office’s management responsibility and deployment capability. Through collaboration, they were able to achieve synergy for upstream and downstream enterprises in the supply chain and especially for end customers. Meanwhile, they enabled value-added information services, increased service quality, and increased satisfaction of end customers.

With the implementation of the new logistics solutions, our customer experienced an inventory accuracy rate of over 99.98%. It has also managed to significantly reduce operating and management costs and improved synergy with customers and partners. Customer satisfaction also received an increased improvement with complaint rates decreasing to less than 0.1% for wrong orders.