Goodyear Engineered Products Taps 3PL to Run DC

Auto industry supplier uses Exel to handle shipping of parts from new distribution center in Moberly, Mo.

Auto industry supplier uses Exel to handle shipping of parts from new distribution center in Moberly, Mo.

Columbus, OH  June 15, 2005  Goodyear Engineered Products has tapped third-party logistics provider Exel to handle shipping of power transmission belts and hoses from a new distribution center in Moberly, Mo.

The new 286,545 sq ft facility in Moberly, intended to improve customer service and accelerate product deliveries, is part of a strategy to improve order turn-around cycles, according to Susan O'Keefe, Goodyear's director of supply chain.

"It's all about meeting our customers' needs by reducing their inventory investments without jeopardizing service to their customers," O'Keefe said. "The new distribution center positions our products closer to the center of our industrial and automotive power transmission belt customer base, shortens shipping times and uses order-processing systems that improve on-time deliveries and fill rates."

Cutting Order Cycle Times

Exel's network analysis team determined that Moberly would be the best location to ensure delivery reliability. After working with local officials to secure the land and tax incentives associated with the new operations, Exel customized the facility in a manner that would increase productivity.

In what once was a 48-hour delivery window, Exel's operations at Moberly have reduced the order cycle time by half for the majority of shipments, according to Dale Wellman, Exel's general manager at Moberly.

"Our day-to-day operations are built so that they can adjust to changing market conditions and customer needs, which provides Goodyear with service flexibility," Wellman said. "The shorter delivery windows from Moberly allow Goodyear's dealers to have fewer inventories on hand. This reduces their costs while providing them with the confidence that they can meet the service expectations of the end customer."

Improving Inventory Forecasting

At its current capacity, the center carries more than 14,000 sizes and specifications of Goodyear industrial and automotive belt and hose inventory, including Goodyear Gatorback, the same automotive belt used by every NASCAR Nextel Cup Series race team. Goodyear had been shipping belt products from a distribution center in Lincoln, Neb.

"The relocation to Moberly coincides with steps we are taking to improve forecasting inventory demands, provide better customer service response time and deliver information accuracy to all customers," O'Keefe noted.

In addition, O'Keefe said that Exel's global presence and capabilities were important in choosing it for the Moberly operation as Goodyear Engineered Products looks to expand its services.

Goodyear plants in Lincoln; Collingwood, Ont., and Chihuahua, Mexico, make products distributed by the Moberly facility. Goodyear Engineered Products has distribution centers in California and Texas, as well as in Mexico and Canada.

Exel also manages logistics for industrial hoses and hydraulics at a Goodyear facility near Columbus, Ohio.

A U.K.-listed company, Exel has an annual turnover of $11.5 billion and employs more than 111,000 people in 2,000 locations in 135-plus countries.

Additional Articles of Interest

 In order to perform on a world-class level, companies must redesign the supply and service chains to meet market demands. Dramatic changes are in order. Read more in the article "Leveraging Supply Chain Logistics: Get Physical and Agile."

 How can you beat the trends and lower your less-than-truckload costs, even in a seller's market? For a guide to help you get started, read the article "LTL Sourcing: Success for Buyers In A Seller's Market."

 For more information on the latest trends in the logistics space, see the article "The Analyst Corner: Fulfillment & Logistics" in the October/November 2004 issue of Supply & Demand Chain Executive.

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