FedEx SupplyChain

Customer Success Story

Global Tests and Supplies Developer and

Manufacturer
This customer is a global leader in the development, manufacture and
marketing of rapid, accurate and cost-effective tests used primarily to
diagnose human diseases.

Getting Ahead of Business Growth

With a primary distribution operation located on the West Coast and a
demand center on the East Coast, this company was experiencing
rising transportation costs and extended transit times to get
consumable products to their nal destinations. Combine this situation
with rapid company growth and quickly this issue became a signicant
risk with the potential to inhibit future growth. This companys
inventory also included temperature-sensitive products with specic
handling and storage requirements, so no ordinary off the shelf
solution would work.
There was also an opportunity to improve their service parts division.
Because the customer also manufactures critical test equipment, they
were looking for a service parts solution that could provide more timely
and accurate access to information that could ultimately help them
improve customer service and effectively manage service costs.

No Ordinary Solution
FedEx SupplyChain worked extensively with the customer to
understand their current business and future strategies. After extensive
nancial analysis, FedEx SupplyChain proposed moving distribution of
the companys compounds and consumables to the FedEx ISO 13485certied Global Distribution Center (GDC) in Memphis, Tenn. Since the

customers primary demand center was on the East Coast, centralizing

distribution operations could improve the average transit time from 3.5
to 2.4 days, lower costs and boost exibility.
To address the needs of the service parts division, a solution including
FedEx Critical Inventory Logistics was proposed. This solution could
address the global requirements of the service parts division through
full integration with the companys existing ERP system. FedEx Critical
Inventory Logistics provided location, route and transportation
optimization, smart cost calculations and time-denite delivery
alternatives for their most critical service parts.

2009 FedEx. All rights reserved.

Customer Opportunities

FedEx Solution

Value Derived

Manage rising transportation costs and

extended transit times.

Distribute compounds and consumables

from the FedEx SupplyChain Memphis
Global Distribution Center.

Estimated $1.4 million a year in

transportation savings.

Support rapid growth.

Maintain temperature-sensitive products
with specific handling and storage
requirements.
Gain access to timely and accurate
information to support service parts
division.

Custom-build a solution to accommodate

specific needs of temperature-sensitive
products.
Integration with customers ERP system
Utilize FedEx Critical Inventory Logistics to
optimize service parts division.

Greatly improved service levels and

reduced average transit times from 3.5 to
2.4 days.
Made capital available to support
future growth by moving from a fixed to
variable cost structure.
Compliance with customers Good
Manufacturing Processes standards for
temperature-sensitive products.
Real-time access to data and reports that
help manage inventory, control costs and
improve customer service levels.

Positioned for Continued Success

Centralized distribution at the FedEx SupplyChain GDC has translated
into $1.4 million a year in transportation savings, greatly improved
service levels and reduced average transit times from 3.5 to 2.4 days.
Centralizing operations to a multi-client facility supports future growth
by moving from a xed to variable cost structure, which frees up
capital. FedEx SupplyChain also meets or exceeds the customers Good
Manufacturing Processes (GMP) standards for their temperaturesensitive products through temperature and environmental controls,
monitoring, data capture and retrieval capabilities.
The service parts division now has full visibility of service parts
inventory via the FedEx Critical Inventory Logistics Web portal to
optimize parts deployment and planning and automate previously laborintensive activities. Now, with FedEx Critical Inventory Logistics, the
customer has real time access to data and reports that help manage
inventory, control costs and improve customer service levels.