Case Studies

hendersonlogistics.com.au/honda-case-study/

HONDA
Honda Australia had established a Melbourne
based, national distribution centre in the late
1970’s. This was fundamental to the Australian
parts and accessories distribution network and since then, Honda had not undertaken a
strategic review and analysis of the supply chain. Parts and accessories for the local
dealer and national customers were no longer being fully sourced from Japan, but are
now being procured from around the world.

The national distribution centre in Melbourne receives imported stocks by sea container
and air freight. Orders are fulfilled to the national customer base consisting of the
dealer network and repairers from this facility. It was time to review the current
strategy in relation to service levels, logistics costs and comparison to other major
automotive parts and accessories suppliers.

Henderson Logistics with their strong retail automotive experience and independent
expertise in supply chain management, provided Honda with the confidence to
investigate the current inbound supply chain plus national distribution of parts and
accessories. This then led to development of the most viable options for improvement.

Various supply chain options were modelled, taking into account:

international shipping and discharge points

warehouse options – centralised vs. decentralised, facility size and function
stock grouping locations
national distribution costs
service levels
impact on CO2 emissions

The current network costs, service levels and CO2 emissions were compared within
each option. Detailed analysis conducted, highlighted a number of financial
opportunities in current sales and distribution processes that were implemented
immediately as the study progressed.

The strategic review and analysis of Honda’s supply chain established key principles
and directions for a lean and flexible, parts and accessories business unit.

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