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Consumer Electronics – Overview PowerPoint Presentation
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Consumer Electronics – Overview

Consumer Electronics – Overview

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Consumer Electronics – Overview

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Presentation Transcript

  1. Perspectives from Freight Transportation Users US Department of Transportation – Federal Highway Administration

  2. Consumer Electronics – Overview • High Value commodities • Profitability challenges due to price erosion, operating costs, and Customer requirements • Small, Medium and Large boxes utilizes a multitude of shipping modes • Highly competitive and growing in competition • 5 years ago major Electronics vendors were: Sony, Philips, Thompson (RCA), Zenith, Sharp, and Panasonic • Today major Electronics vendors are: Sony, Philips, Thompson, Panasonic, Samsung, APEX, Audiovox, Sharp, and Sanyo.

  3. Consumer Electronics – Overview • New Competitors in 2004: Dell, Gateway, and Virgin Companies launch new products in the CE sector. • Forecasting, Order, and Shipping migration from Monthly Cycle to Weekly cycle • Customer Requirements • Radio Frequency Identity (RFID) • Vendor Compliance

  4. Philips - Overview • Philips Consumer Electronics balances Customer demand and requirements with 300 model variations to ensure timely delivery of our product. • Product sizes vary from the size of a disposable razor to a 60” projection television. • The customer mix ranges from small to large companies. • 3 Outbound Distribution points in the US • Greeneville, TN • Roanoke, TX • Riverside, CA • Products are manufactured in Europe, Asia, and Mexico.

  5. Philips - Overview • Inbound shipments • Port of Entry (Asia and Europe) • Moving product from Port to Warehouse • US/Mexico Boarder crossing • Third Party Logistics Provider involvement (3PL)

  6. Philips – Overview Transportation • Restructured the Supply Chain (3PL) • Modes of Transportation • Air (Next Day, 2nd Day, 3 Day) • Ground (Parcel Ground ie. Fed Ex, UPS) • Less Than Truckload (LTL) • Truckload • Intermodal (Rail) • Transition from LTL and Ground (150lbs+ shipments) • LTL Expedited service vs. Traditional “Air” service

  7. Philips – Overview Transportation • Hours of Service – Challenge in 2004 • Multiple Stops (More than one customer on a trailer) • Increased charges from Carriers for Detention and Multi-Stops • Equipment Demand moves from Moderate to Severe • Driver retention and expansion • Will force more equipment on the road vs. less • Capacity battle transforms to a capacity war • LTL shipments will increase as will costs of operations (Carriers, Shipper, and Customers) • 2001, 10% of all truckloads shipped by Philips were multi-stop shipments • 2003, 46% were multi-stop shipments.

  8. Philips – Improvement Opportunities • “Being an attractive fish, in a Big fish pond” • Carrier relationships • Equipment utilization • Equal profitability • Automating Truckload “tender” process • Rail congestion • Utilization can increase if transit time improved • Factory Direct • Customer’s Freight Forwarder • Mexico Direct

  9. Transportation Statistics

  10. Transportation Statistics

  11. Transportation Statistics

  12. Transportation Statistics

  13. Transportation Statistics

  14. Transportation StatisticsAverage Cubic feet utilized (Truckload volume)