APPLE

Change as part of hub implementation

■ After implementation –
 Suppliers were asked to send raw material to supplier hub . From supplier hub freight
forwarder use to deliver to apple centre
 Ownership shifted to supplier as payment mode used was Deliver Duty Unpaid(DDU)
 Freight forwarder for suppliers:
Cork Island- Irish company or choice left to supplier
Fountain, Colorado-Fritz company
 Just In Time(JIT) concept were implemented and inventory was stored outside site after
implementation
 Supplier Hub at Sacremento

■ Yes, supplier hub implementation is required in the case of few components. It

would result in –

 Reduced inventory levels

 Uncertain and growing demand : Incoming materials on the day of usage
 Reduced inventory cost – Holding and Carrying cost
 Reduction in COGS
 Deferral duties
Supplier Hub at Sacremento Considered Parameters

Components flowing through Hub – Hub Non-Hub

 Monitors Lead Time High lead time Low lead time

 PC Assemblies Store More Less

Requirement
 Power Supplies (Pallets)
Duty Rate Applicable Non-Applicable
 Mass storage.
Quantity More Less

Holding and More Less

Carrying Cost
 Supplier Hub at Sacremento

■ Sacremento is different from Fountain and Cork –

Cork Fountain
Bonded warehouse is not required Non-hub materials are not stored
In-house – Field Warehouse
Tracking of physical goods Minimize investment
 Findings
■ Firstly, This case concentrated on the supply chain comprising multisupplier, Supply
Hub, and multidistributor. To the best of our knowledge, this which study on the
multilocation inventory system with Supply Hub For purposes of comparison, They
should take 3PL(supplier hub) that which makes profit model of the inventory system,
respectively, for the cases without and with transfer of materials.
■ Secondly, we verified that the shipment of materials by the use of JIT/KANBAN process
could improve the performance of the multilocation inventory system with Supply
Hub.so, without supplier hub they cant implement
■ Shortage of space in Sacramento, California
■ Inventory problem
■ Payment issues to the suppliers until the material received to the production department
(Fountain, Colorado)
■ In Sacramento they usually prefer more local transportation
■ Apple fountain not having opportunity of “local sources of supply” as apple Sacramento
has
THANK YOU