Supply Chain Setup and Vendor Coordination

Supply Chain Setup and Vendor Coordination by Sigma Solutions

Introduction

A prominent automobile parts manufacturer struggled with raw material delays, inefficient procurement, and rising logistics expenses. Facing mounting pressure to streamline production and reduce costs, the company engaged Sigma Solutions to overhaul its supply chain setup and vendor coordination system for greater resilience and scalability.

Challenges Faced

1. Unstructured Supplier Network & Material Delays

Lack of centralized vendor management resulted in inconsistent deliveries and frequent production halts.

2. High Procurement & Transportation Costs

Poor price negotiation and inefficient routing significantly inflated the cost of raw material sourcing.

3. Inventory Planning & Warehousing Issues

Frequent stockouts and overstocking occurred due to the absence of demand forecasting tools.

4. Compliance Risks from Unverified Vendors

Several suppliers failed to meet ISO, BIS, and environmental safety standards, putting operations at regulatory risk.

5. No Real-Time Tracking Systems

The lack of digital monitoring caused disruptions, poor visibility, and delayed decision-making in material flow.

Solution Provided by Sigma Solutions

Sigma Solutions introduced a strategic, technology-driven supply chain model, built on vendor audits, digital systems, and smart logistics planning.

Implementation Process

1. Vendor Assessment & Network Optimization

Conducted full vendor audits to evaluate quality, reliability, and certification status.
Segmented vendors into tiered categories based on performance and criticality.

2. Procurement Negotiation & Cost Optimization

Negotiated bulk purchase discounts and established long-term framework agreements.
Deployed a multi-vendor sourcing model to avoid single-supplier dependency.

3. Transportation & Logistics Enhancement

Designed multi-modal routes combining road, rail, and air to lower transit time and cost.
Partnered with third-party logistics (3PL) providers for efficient JIT deliveries.

4. Digital Inventory Tracking & Forecasting

Implemented RFID and IoT-enabled warehouse systems to enable real-time visibility.
Integrated AI-powered demand forecasting tools to manage seasonal and bulk order needs.

5. Compliance & Vendor Training

Ensured complete adherence to ISO, BIS, and industrial safety standards.
Conducted training sessions for vendors to align with compliance expectations and safe handling protocols.

Results Achieved

30% Reduction in Procurement & Logistics Costs
40% Improvement in On-Time Deliveries
100% Supplier Compliance with Quality & Safety Standards
98% Inventory Accuracy with real-time digital visibility
Future-Ready Procurement Ecosystem that supports scale and automation

Conclusion & Key Takeaways

An optimized supply chain drives cost efficiency, supplier reliability, and production continuity. Sigma Solutions enabled the client to transform its end-to-end operations by leveraging strategic sourcing, logistics optimization, and digital inventory systems—ensuring greater resilience, speed, and scalability.