Case Study: Distribution Strategy

Case New Holland

• CNH, a global agricultural and construction equipment manufacturer, has 39 manufacturing facilities in Europe, North America, Latin America, China, India and Uzbekistan. With 28,100 employees, the company has more than 11,000 dealers in 160 countries.
• It brings together four Case and New Holland brand families -- all backed by the strength and resources of its worldwide commercial, industrial, product support and finance organizations.

The Challenge

• CNH's logistics service provider (LSP) had many operational issues and was delivering poor service to its dealer network.
• The company needed to determine whether it is best to stimulate its relationship with the existing LSP operator, select a new LSP, or manage its distribution centers' (DCs) operations internally.

Tompkins' Role

• Tompkins conducted an LSP selection process to identify and select a provider that is able to manage CNH's complexities, multiple order profiles, level of service, and cost requirements.
• The process involved a qualitative and quantitative analysis of three to five providers, including an internal analysis for CNH, with a recommendation of the best path forward.

The Results

• The bid selection and following analysis showed that the best way to service the customer was for CNH to take over the main receiving and packing facility and to outsource the remaining US and Canadian facilities to the selected provider.
• As a result of controlling its operations internally, CNH expects an improvement in customer service. The company also plans to have better continuous improvement initiatives that will yield superior results and increase cost savings.