CIP Services AG renewed a long-term contract for new supply chain services for a global player. CIPs advanced service modules and Vendor Managed Inventory (VMI) concept, re-imagines the restocking process for Diehl Controls. One out of five major household appliances in Europe contains technologies developed by the German based company.
For 70% of its products of electronic display and control systems, networking solutions or energy management system, Diehl Control focuses on sourcing parts and components from Greater China. For more than 5 years, CIP is managing supply chain businesses for Diehl Control in the economic zones between Asia and Europe. The supply chain experts of CIP are the central point of contact. CIP takes over the complete responsibility and management processes for all order flows from supplier to customer plants.
Over the years of strong strategic partnership and continuous developing, CIP achieves a 100% delivery performance. “Since implementing CIP’s supply chain services, Diehl has significantly reduced inventories by 38%, which has moved funds from inventory to cash on the balance sheet” said CIP’s Vice President Supply Chain Management. “In addition, this initiative has helped to reduce delivery times and freight costs for our customer.”
The supply chain experts of CIP analyses workflows and offer tailored made modules to optimize working capital KPI’s as well as the classical supply chain management KPI’s like delivery performance or lead time performance. Diehl profits to have less working capital mainly driven by reduction of inventories which results in more free cash flow. Consequently, the customer drives a higher return on capital employed (ROCE). That realizes the potential for material supplier discounts (in average 6-15% depending on the material). Beside to these numbers, CIP Services set up an automated electronic data exchange connection to its partners with fully automated robust processes. This, coupled with CIP’s sophisticated warehouse management, enables suppliers to manage product replenishment and improve in-stock performance on behalf of end customers. “Our customized supply chain services makes it possible to Diehl Control to focus on its core business, retain existing business and grow market share, while outsourcing the operative processes to CIP” said Dimitrios Bachadakis, CEO of CIP Services AG. He adds: “We are glad that we achieved the next step in our strong alliance with Diehl Controls, and we are looking forward into a flourish future”.
Diehl Stiftung & Co. KG is an industrial group based in Nuremberg (Germany) with global operations. With over eighty sites in around twenty countries on four continents, Diehl employs approximately 18,000 people. The company has been in family ownership since it was established in 1902. Today the Diehl Group has forty subsidiaries that are divided into five divisions, selling a broad range of products and services. Diehl Controls is one of these divisions and the company with more than 50 million produced units per year is among the world‘s leading developers and manufacturers of control systems.
CIP SUPPLY CHAIN SERVICES
CIP Services AG is part of the global operating CIP Group and offers most complex supply chain services to deliver key components from manufacturing facilities in Asia to costumer sites worldwide. Founded as a Management Buy-Out from SIEMENS Head Quarter Division Purchasing & Logistics in 2004, CIP SERVICES AG started as a key automotive and industrial supplier for components from Asian markets throughout the world. In the past decades CIP continued independently to be a supplier, paired with global supply chain services and innovative digital solutions of tomorrow. Long-lasting operative supply chain expertise for complex processes, has allowed us to flourish in performing in the global economic zones between Greater China to the European Union and across the globe.