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Supply Chains The view from the end of the tail

Supply Chains The view from the end of the tail. Waterloo Air Management Product Range. Air Handling Units Attenuators Chilled beams Dampers Damper Control Panels Fan Coil Units. Filters Grilles & diffusers Louvres Perimeter & Trench Heating Radiant Panels VAV & FAT Boxes.

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Supply Chains The view from the end of the tail

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  1. Supply ChainsThe view from theend of the tail

  2. Waterloo Air Management Product Range • Air Handling Units • Attenuators • Chilled beams • Dampers • Damper Control Panels • Fan Coil Units • Filters • Grilles & diffusers • Louvres • Perimeter & Trench Heating • Radiant Panels • VAV & FAT Boxes

  3. Sir John Egan said…… “A fully tendered project cost twice as much as a fully integrated project”

  4. Sir John Egan said…… “Of the savings, 1/3rd comes from integrating the team and 2/3rd from integrating the supply chain”

  5. Sir John Egan Why can he say that?

  6. Team integration Supply chain integration By integrating FULLY &

  7. Team integration brings… Reading Construction Forum Research Cost benefits of partnering

  8. Supply chain integration brings…. • Experience • Continuous improvement • New ideas • Consolidation • Scale • Investment

  9. Team integration Client focus Planning integration Reduced construction time Prefabrication/preassembly Risk planning Site scheduling Pain/gain allocation Whole life decisions Health & safety Supply chain integration Cost reduction/profit improvement Design & cost consistency Target costing Transaction cost reduction Volume efficiency Logistics Product integration Repeatable solutions Innovation introduction Increased investment e-commerce Which leads to…..

  10. What is cost? 2.044kg

  11. What is cost? 2.044kg

  12. What is cost? 2.044kg

  13. What is cost? 2.044kg

  14. 1.877kg What is cost? 2.044kg

  15. The effect of customer behavior Profit Overheads Factory costs Manufacturers’ costs Direct labour Materials

  16. The effect of customer behavior Profit Overheads Factory costs Direct labour • Volume • Forward planning • Fit for purpose design • Standardisation • Waste management Materials

  17. The effect of customer behavior Profit Overheads Forward planning Workload management Full production runs Production investment Automation Factory costs Direct labour Materials

  18. The effect of customer behavior Profit Overheads Volume Forward planning Production investment Automation Factory costs Direct labour Materials

  19. The effect of customer behavior Marketing Selling costs Tendering Logistics & stock control Credit control Insurance Direct effect Profit Overheads Factory costs Direct labour HR Accounting R&D Etc. Indirect effect Materials

  20. Current Average Historic Customer Lean Customer Future Customer

  21. Overhead savings – an example • Wasted tenders • Multiple entry • Invoice matching • Site queries • Invoice clearing • Credit control • Etc

  22. Annual Spend = £900,000 An example - Fixed pricing Competitive Tendering – 20 Separate projects 2,000 Products £400 to £700 (Avge £500) Annual Spend = £1,000,000 Stable Supply Chain – Single negotiation 2,000 Products all at £450 Further opportunities

  23. What’s difficult with integration? • Belief • Trust • Drive the benefits

  24. Everyone’s a winner It’s good for you but why do I want it? • Volume • Ability to invest • Stability of work • Lower risk • Better profit through lower costs • Customer satisfaction • A “fully partnered” business plan • 10-20% more savings for the customer

  25. Which one for you? Integrateor disintegrate

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