Another acquisition took place in early 2004, when TradeBeam, an international global trading solutions provider with over 3,000 customers and users in over 100 countries, acquired SupplySolution. SupplySolution is a Southfield, Michigan-based (US) offers a supply chain execution (SCE) application called i-Supply, which communicates inventory levels and consumption patterns among trading partners. At the time of the acquisition, SupplySolution had in excess of 2,000 paying customers and employed 125 people in offices in the US, Germany, and Australia. TradeBeam acquired SupplySolution to add collaborative inventory management (CIM) capabilities to its GTM product suite.
The acquisition has benefited both companies and their respective customers, given TradeBeam and SupplySolution have similar roadmaps for the management of order, inventory replenishment, compliance, logistics, and payment of the domestic and international movement of goods. Their combined product has helped many common customers avoid deploying multiple point solutions to manage their global supply chains. Effective supply chain management is increasingly vital for global manufacturers' and retailers' success, as enterprises now spend an inordinate amount of time and money managing and directing their suppliers to ensure that critical inventory levels are maintained, and the vital flow of products needed for operation continues. However, the current practice for managing supply chain inventories is still rather reactive and labor intensive, and results in unreliable parts availability, generating typically higher inventory levels or emergency freight. As a result, enterprises are faced with increased inventory carrying costs, higher premium freight charges, decreased customers satisfaction, diminished asset utilization, decreased supplier performance, etc.
To remedy this, TradeBeam offers inventory replenishment products and plans to build and offer other inventory flow management related services over next several months. SupplySolution was a renowned SCE provider, delivering value to manufacturers, distributors, and suppliers through the implementation of the collaborative supply chain application, i-Supply. i-Supply remains one of the most widely used real-time applications for communicating inventory levels and consumption patterns in the automotive industry, in operation at over 2,000 organizations. Under new ownership, i-Supply will be renamed TradeBeam CIM.
The SupplySolution had been highly successful in direct material replenishment applications—a space where many others have failed. Steve Bell, a former general manager of a tier one automotive plant, founded SupplySolution in 1998. The company landed its first pilot customer in July 1999, and in 2001, it contracted some major tier one customers, including Johnson Controls and the largest automotive supplier, Delphi. Since then, it had steadily added other new customers, including the suppliers of its original tier one accounts. All in all, the company landed 35 buyers and 2,000 suppliers in a little more than 3 years since its inception. In 2002, SupplySolution expanded into the life sciences industry, starting with a successful pilot with Stryker Instruments, a manufacturer of specialty surgical and medical products.
TradeBeam's CIM is a collaborative inventory management system, which, in simple terms, provides a means for reducing inventory. It allows an enterprise's suppliers to look inside the inventory database containing information such as stock items, inventory replenishment policies, current stock situation, etc., and replenish its supplies based on predetermined minimum-maximum, or min-max levels. All of this represents outsourcing inventory management in a data processing sense. The product can also enable other processes, such as electronic kanban (to replenish lot size) quantities, since it gives virtually real-time information to suppliers, so that they can deliver as soon as the inventory is consumed instead of shipping against a forecast. In other words, the system provides explicit feedback to the supplier on when and how much inventory to send. One should note that supplier management inefficiencies directly affect tier one manufacturers' bottom lines because purchased parts are possibly the biggest cost driver. On their hand, the biggest complaints of many tier two suppliers are inaccurate forecasts and misleading shipping schedules from their larger trading partners (customers).
Consequently, when user enterprises first implement the TradeBeam CIM system, they would typically start with higher safety stock levels, and then gradually adjust those inventories down, as they build trust with each vendor. Given that production and logistics lead times may vary between parts and suppliers, TradeBeam's CIM is a system that could be configured to provide just-in-time (JIT) replenishment for any part. Further, product life cycles always change. What might make sense this month can be either way too little or way too much the next month; therefore, the system could also help customers maintain appropriate replenishment quantities over time, through its forecasting mechanisms. Over time, some companies have consequently adopted a variety of formulas to best determine lot sizes that are consistent with current rates of demand.
Also, since many current ERP systems do not properly address the establishment of optimal min-max inventory levels, the CIM solution can provide both the buyer and the supplier with a single source of data for actual consumption, average consumption, and forecasted demand. Buyers could download this information into a Microsoft Excel spreadsheet, manipulate it, and come up with formulas to calculate appropriate min-max levels for their companies. Additionally, customers wanting to anticipate transitory changes in demand, can use the product to support temporary kanban lot sizes. Users can change the lot size for one cycle only, so that the supplier only has to deliver a larger or smaller quantity once, and then receive replenishment messages for the original kanban quantity. Conversely, the system can also allow the buyer to put selected kanbans on temporary hold,. In this instance, as kanbans are consumed they are put on hold, so that the supplier does not replenish them.
Other major features of TradeBeam's CIM include real time change visibility; fulfillment with pull-based processing; collaborative inventory management; direct material replenishment; suggested delivery quantity and timing; and in-transit visibility. It also allows forecasting analysis with min-max goals for capacity evaluation and production scheduling; analysis of patterns of consumption; actual material usage visibility; EDI functionality; advanced repetitive replenishment; in-transit goods management, and quality management support. The solution is available in several languages beside English, including Chinese, German, Italian, and Spanish.
The solution is not required to enable suppliers to respond to the buyers' requirements electronically. Advance shipment notices (ASN), purchase order confirmations, or shipment data, do not need to be sent since it is not a permission system, where the supplier needs the go-ahead prompt to send material. By virtue of being invited to participate in the system by the customer, the supplier is presumably given the upfront go-ahead to replenish inventory to predetermined min-max levels, and unless it informs the customer that it is unable or unwilling to meet the needed material requirements, it is authorized to fulfill to min-max levels on a continuous basis. The system also allows for measuring performance against those min-max levels, sso that involved user parties can address any failure to maintain inventory at the predetermined levels.
The acquisition has benefited both companies and their respective customers, given TradeBeam and SupplySolution have similar roadmaps for the management of order, inventory replenishment, compliance, logistics, and payment of the domestic and international movement of goods. Their combined product has helped many common customers avoid deploying multiple point solutions to manage their global supply chains. Effective supply chain management is increasingly vital for global manufacturers' and retailers' success, as enterprises now spend an inordinate amount of time and money managing and directing their suppliers to ensure that critical inventory levels are maintained, and the vital flow of products needed for operation continues. However, the current practice for managing supply chain inventories is still rather reactive and labor intensive, and results in unreliable parts availability, generating typically higher inventory levels or emergency freight. As a result, enterprises are faced with increased inventory carrying costs, higher premium freight charges, decreased customers satisfaction, diminished asset utilization, decreased supplier performance, etc.
To remedy this, TradeBeam offers inventory replenishment products and plans to build and offer other inventory flow management related services over next several months. SupplySolution was a renowned SCE provider, delivering value to manufacturers, distributors, and suppliers through the implementation of the collaborative supply chain application, i-Supply. i-Supply remains one of the most widely used real-time applications for communicating inventory levels and consumption patterns in the automotive industry, in operation at over 2,000 organizations. Under new ownership, i-Supply will be renamed TradeBeam CIM.
The SupplySolution had been highly successful in direct material replenishment applications—a space where many others have failed. Steve Bell, a former general manager of a tier one automotive plant, founded SupplySolution in 1998. The company landed its first pilot customer in July 1999, and in 2001, it contracted some major tier one customers, including Johnson Controls and the largest automotive supplier, Delphi. Since then, it had steadily added other new customers, including the suppliers of its original tier one accounts. All in all, the company landed 35 buyers and 2,000 suppliers in a little more than 3 years since its inception. In 2002, SupplySolution expanded into the life sciences industry, starting with a successful pilot with Stryker Instruments, a manufacturer of specialty surgical and medical products.
TradeBeam's CIM is a collaborative inventory management system, which, in simple terms, provides a means for reducing inventory. It allows an enterprise's suppliers to look inside the inventory database containing information such as stock items, inventory replenishment policies, current stock situation, etc., and replenish its supplies based on predetermined minimum-maximum, or min-max levels. All of this represents outsourcing inventory management in a data processing sense. The product can also enable other processes, such as electronic kanban (to replenish lot size) quantities, since it gives virtually real-time information to suppliers, so that they can deliver as soon as the inventory is consumed instead of shipping against a forecast. In other words, the system provides explicit feedback to the supplier on when and how much inventory to send. One should note that supplier management inefficiencies directly affect tier one manufacturers' bottom lines because purchased parts are possibly the biggest cost driver. On their hand, the biggest complaints of many tier two suppliers are inaccurate forecasts and misleading shipping schedules from their larger trading partners (customers).
Consequently, when user enterprises first implement the TradeBeam CIM system, they would typically start with higher safety stock levels, and then gradually adjust those inventories down, as they build trust with each vendor. Given that production and logistics lead times may vary between parts and suppliers, TradeBeam's CIM is a system that could be configured to provide just-in-time (JIT) replenishment for any part. Further, product life cycles always change. What might make sense this month can be either way too little or way too much the next month; therefore, the system could also help customers maintain appropriate replenishment quantities over time, through its forecasting mechanisms. Over time, some companies have consequently adopted a variety of formulas to best determine lot sizes that are consistent with current rates of demand.
Also, since many current ERP systems do not properly address the establishment of optimal min-max inventory levels, the CIM solution can provide both the buyer and the supplier with a single source of data for actual consumption, average consumption, and forecasted demand. Buyers could download this information into a Microsoft Excel spreadsheet, manipulate it, and come up with formulas to calculate appropriate min-max levels for their companies. Additionally, customers wanting to anticipate transitory changes in demand, can use the product to support temporary kanban lot sizes. Users can change the lot size for one cycle only, so that the supplier only has to deliver a larger or smaller quantity once, and then receive replenishment messages for the original kanban quantity. Conversely, the system can also allow the buyer to put selected kanbans on temporary hold,. In this instance, as kanbans are consumed they are put on hold, so that the supplier does not replenish them.
Other major features of TradeBeam's CIM include real time change visibility; fulfillment with pull-based processing; collaborative inventory management; direct material replenishment; suggested delivery quantity and timing; and in-transit visibility. It also allows forecasting analysis with min-max goals for capacity evaluation and production scheduling; analysis of patterns of consumption; actual material usage visibility; EDI functionality; advanced repetitive replenishment; in-transit goods management, and quality management support. The solution is available in several languages beside English, including Chinese, German, Italian, and Spanish.
The solution is not required to enable suppliers to respond to the buyers' requirements electronically. Advance shipment notices (ASN), purchase order confirmations, or shipment data, do not need to be sent since it is not a permission system, where the supplier needs the go-ahead prompt to send material. By virtue of being invited to participate in the system by the customer, the supplier is presumably given the upfront go-ahead to replenish inventory to predetermined min-max levels, and unless it informs the customer that it is unable or unwilling to meet the needed material requirements, it is authorized to fulfill to min-max levels on a continuous basis. The system also allows for measuring performance against those min-max levels, sso that involved user parties can address any failure to maintain inventory at the predetermined levels.
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