CA Distributors Company is a global distribution company for wire and cable products. In 2017 for the first time, started operations with an Asian company named China Telecom. The program objective is to store power cable sourced from an Asian vendor (Shenzhen Products) in local warehouses located Latin America (Guadalajara, Mexico & Colon, Panama). The product is shipped from Shenzhen China via ocean freight with an average transit time from six to seven weeks to both warehouses. CA Distributors Company and China Telecom agreed to store eight weeks forecast worth material in each of their warehouses in order to meet China Telecom’s demand. Every week China Telecom sends an updated forecast which will show up to twelve weeks expected usage, based on a simple addition of the first eight weeks CA Distributors Company will place an order to the Chinese vendor.
The purpose of this document is to explain the reasons why choosing a 3PL at Manzanillo Port, is the most suitable options for better inventory management, rather than using a consignment program, or increasing inventory quantity in local warehouses. In addition to that, CA Distributors Company will implement new service cost to China Telecom in order to satisfy customer demand and keep business profitability in all additional services offered.
