Integration Case Studies

Integration engagement focuses on an integrated relationship of procurement and supply chain functions yielding higher productivity, efficiencies, and reduction of costs attributed to inventory, facilities, labor, and indirect costs of operations.

Aerospace Manufacturer

A major manufacturer of aircraft components worked with DistributionNOW’s machine tools supply and manufacturing service group to implement point-of-use vending systems, leading to a 60% downsizing of the on-site tool crib. Inventories were reduced by 40% by repackaging in economic use quantities. Inventory accuracy and availability increased to 99.98%, reducing stock outs and spot buys. For manufacturing, productivity increased 30% through advanced cutter technology and machining methods, while improved cutting fluid technology increased tool life by 30%. Tool costs were reduced by 30% by implementing a proactive tool reconditioning and use process.

Independent Exploration and Production (E&P) Company

Goal

Lower total cost of ownership, including product, labor, and administrative costs. Manage and reduce customer-owned inventories. Reduce construction times for new projects.

Solution

Operate 8 customer-dedicated facilities and 20+ remote storage locations to support day-to-day activities. Manage dedicated customer inventories within DNOW's enterprise resource planning (ERP) system, including 3rd party consignments and customer-owned materials. Reduce total cost of ownership by standardizing to DNOW core products and leveraging supplier relationships. Use mobile scanner devices to track issued materials and replenishment of remote storage units.

Result

New customer-dedicated facilities reduced customer-owned inventories by $75 million since implementation, and closed more than 100 customer service yards. Reduced the number of suppliers by 66% through product standardization, and reduced costs on those suppliers through negotiations and volume purchases. Reduced construction times with hook-up packages that ensure order accuracy and include all parts with their associated equipment.