IntroductionBentley motor, which manufactures luxury automobiles, was established in 1919 founded by W.O. Bentley. However since 1998, the company owned by Volkswagen Group and the business located at Crewe, Cheshire, United Kingdom (BentleyMotors, 2012). Bentley motor can be described as traditional craftsmanship, ambitious environmental policies and ultimate luxury. The company currently has employs approximately 3,726 workers and has annual revenue (estimated) of $ 779,792,550 (Manta, 2012).
Vision“We are Bentley Motors – the definitive British luxury car company, dedicated to developing and crafting the world’s most desirable high performance cars ( BentleyMotors, 2012)”.
MissionThe company’s mission is “To build a fast car, a good car, the best in its class ( BentleyMotors, 2012)”.
Bentley’s Logistics OperationsBentley’s logistics operations work with suppliers and third party Logistics to determine optimum supply chain routes and develop suitable packaging to maintain component quality throughout transportation and handling (BentleyMotor, 2012).
Inbound logisticsInbound logistics is the activities of receiving, storing, disseminating incoming inventory parts or material for use (BusinessDictionary, 2012) from suppliers to the manufacturing or assembly plants. Bentley used to collect the inbound material from other suppliers at different countries. 80% of them come from Europe and also Germany (AutomotiveSupplyChain, 2012). Most of the inbound logistics activities were handled by outsourcing.
A material requirements planning system (SAP/R3) is used to plan the daily / weekly inbound delivery schedules of components from the supplier base. Vendor planners are then responsible for ensuring the on time delivery of components, to support production, whilst minimising transportation and inventory holding costs (BentleyMotor, 2012).
Transportation of Inbound MaterialsBentley has found a third party logistics firm to handle the transportation of the components from suppliers/vendors. According to Yusen Logistics (Europe), NYK Logistics has extend a contract between Volkswagen Logistics in order to provide inbound logistics services for delivering the components into Bentley Motor’s production facility located at Crewe. NYK Logistics is responsible to deliver all these components to the Crewe plant from suppliers throughout Europe. Through “collect to manifest” system, Bentley parts will be cross-docked at NYK hubs in Germany and UK before all of it send to Crewe plant. This system can assure Bentley complete control over their inventory and vendor (YusenLogisticsEurope, 2009).
Receiving Process and Movement of MaterialIn the same year which is 2009, Bentley has also invested £13.6 million in Integrated Logistics Centre (ILC). The construction of ILC has dramatically improved the reaction time. The kanban system has been implemented, and there is a picking cycle of every 45 minutes on 8 routes which go to different areas of assembly line. This has contributed to 30% reductions in material movements and £3.5 million annual revenue costs have been saved. The receiving process and movement of material to the factory become more efficient (AutomotiveSupplyChain, 2012).
Automated Material Handling SystemAs the components and parts were stored at Crewe plant, the management of inventory will be more complex. Furthermore, Bentley as a luxury automobiles manufacturer, the uniqueness of the materials and components also contributed to the complexity.
Due to limited space, Bentley has relocated its part centre at Crewe and TGW Logistics Group fit-out this new facility with an automated warehousing solution (HSSSearch, 2012). There is no longer manual order picking of parts that is labour intensive. An automated storage and retrieval system by TGW Logistics has implemented which has significantly improved the speed and accuracy of the order picking system (HSSSearch, 2012). In order to service 5 aisles of warehousing and 60,800 storage location within the new parts centre, 5 automated storage and retrieval (ASR) machines are used (WorksManagement, 2012).
According to TGWGroup (2012), the Mustang mini-load ASR machines which used to store the parts can reach “double deep” into the rack and maximize the use of space, while an automated conveyor system is used to takes parts to workstations (presented in an optimised position for manual packing). TGW’s warehouse management system will control both automated storage system and automated conveyor system. The network of both systems was linked together concerning the goods receiving and product conditioning workstations (TGWGroup, 2012).
Outbound LogisticsAccording to BusinessDictionary (2012), outbound logistics is defined as the movement of material associated with storing, transporting, and distributing goods to its customers. As Bentley’s automobiles are wider, higher and more valuable, prevention of transit damage is important.
Transportation modesThere are 4 modes used by Bentley which are road, sea, air and rail. Road and sea are most commonly used, while air freight is used when there are emergencies or special customer requests. Rail is not used by Bentley to transport cars but containers. Due to the distinct size of the vehicles, space of rail car is not wide enough. The risk of damage in a rail car is too high for Bentley’s cars. However, rail is used to transport containers which consists cars inside from inland container depots to the ports. The cars are loaded into containers by Bentley personnel in a controlled environment (AutomotiveSupplyChain, 2012).
Transport providerBentley has a very strict and robust loading trial exercise for transport providers before selecting them. Bentley looks for supplier which is innovative, continually improving and working in partnership with Bentley.
Currently, Bentley has extends its contract with Ontime Automotive fordelivery of its prestige vehicles. Ontime is responsible for vehicles movements from Bentley’s site in Crewe to its UK dealerships and managing the movement of all cars for US, Russia and Japanese export to the Port of Grimsby. In addition, a dedicated service is provided for Bentley with 1 Rolfo enclosed transporter being used solely for dealer distribution, while another three transporters is used for exports to the Port of Grimsby (LogisticsManager, 2012).
Competitive AdvantagesEfficiency of Inbound LogisticsBentley has controlled their inbound logistics in a way that is effective and efficient. Firstly, the “collect to manifest” system by NYK Logistics assures Bentley to have a complete control over their inventory and vendors (YusenLogisticsEurope, 2009). And also, automated storage and retrieval system has help Bentley boost up the picking efficiency and improved inventory control (WorksManagement, 2012).
The used of Mustang mini-load ASR machines has reduced the power requirement and lowered the operating costs. Besides, due to the ability of Mustang to reach “double deep” into the rack, it has maximizing the use of space. As whole, the solution not only delivered substantial operational efficiencies and costs savings, but also improved pick accuracy and better inventory control. In addition to that, the kanban system introduced by ILC has improved the reaction times, reduction in material movement and reduces revenue costs of £3.5 million a year (AutomotiveSupplyChain, 2012).
When Bentley outsourced to third party logistics firm their inbound logistics activities, it actually helps Bentley to gain competitive advantages. Due to these logistics firm are expert in handling these activities, they can help Bentley to achieve speed and accuracy. In this way, Bentley can improve in operating cost structure where indirectly has increased the revenue of Bentley. Hence, the efficiency of Bentley’s inbound logistics has gain competitive advantage.
Outsourcing Experienced Logistics Service ProviderIn the luxury car sector in UK alone, there are few brands include Rolls Royce and Aston Martin. To gain competitive advantage, damage-free delivery is essential. To do so, Bentley selects their transport provider carefully. Transport providers of Bentley have to go through a strict and robust loading trial exercise. The providers’ enclosed trucks also need to be able carry all the configurations due to Bentley’s cars are distinct in their sizes and models (AutomotiveSupplyChain, 2012). To become Bentley’s transport provider, these companies need to be able to invest in new assets such as cross docks and facilities.
According to AutomotiveSupplyChain (2012), Bentley was acquired by Volkswagen which allows them to share their internal networking system. Volkswagen is experienced and all the suppliers have to gone through a strict audit process. Every transporter that approaches Bentley for outbound purpose is essential to go through all checking processes. By sharing suppliers with Volkswagen, Bentley was able to receive synergies such as containerisation and the awareness and education of the suppliers.
Collaborate with experienced company were able to help Bentley gain competitive advantage because they were excelled in innovation, trust and security that are vital for successful of outbound logistics programme (LogisticsManager, 2012). Security, on-time and damage-free products will always gain high customer satisfaction level.
ConclusionAs a conclusion, logistics management is important to every company. It can indirectly affect a company’s performance. Although most of the logistics activities of Bentley are outsourcing, but Bentley still gain many benefits that lead them to gain competitive advantages. However, Bentley needs to aware and continuously improve their logistics management in order to gain sustainable future.
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EHow, 2012, Kanban System Definition, retrieved 20 November 2012, <http://www.ehow.com/facts_6932710_kanban-system-definition.html>
AppendicesOverview of Bentley Facility located at CreweBentley Motor Factory
Internal view of Bentley Motor Factory
Bentley emphasize on craftsmanship
Bentley Heritage Vehicles
Bentley MulsanneBentley Supersports
——————————————–[ 2 ]. Kanban is Japanese for “card” or “ticket.” It is a business term that refers to the process of tracking inventory through a production line. A kanban system helps monitor inventory so companies can keep track of stock and maintain appropriate quantities of merchandise. [ 3 ]. The Mustang mini-load ASR machine is 9-metre high which have rigid masts and telescopic handlers. Extremely energy efficient and with a lightweight construction and