Asian Paints: Supply Chain Efficiency
Introduction: Asian Paints is India's largest paint company and ranked among the top ten Decorative coatings companies in the world with a turnover of INR 66.80 billion. Asian Paints along with its subsidiaries have operations in 17 countries across the world with 23 paint manufacturing facilities, servicing consumers in 65 countries through Berger International, SCIB Paints – Egypt, Asian Paints, Apco Coatings and Taubmans.
Asian Paints sells through some 25,000 local retailers, who resell its products to home users, contractors and painters. The company also sells paints and colours to original equipment manufacturers (OEM) and to large contractors serving the OEM marketplace. To serve those demanding market segments, Asian Paints produces more than 1,200 standard paint product SKUs and many made-to-order formulations, and operates about 80 sales offices to support its marketing and distribution efforts.
Challenges: This dynamic marketing and production environment requires a sophisticated and robust supply chain. In its search for a true competitive edge, Asian Paints' executives set two key objectives for its supply chain. 1. They sought to deliver product efficiently to customers without holding a large amount of inventory. 2. They wanted to manage their cash cycle to free up funding for an aggressive growth-by-acquisition strategy.
Solution: Asian Paints applied advanced master planning technique to decide which products should be produced at which manufacturing plants, incorporating variables such as cost and demand volume, capacity, current inventory levels, environmental requirements and other factors, optimizing across multiple objective levels like capacity, demand satisfaction, safety stock requirements, inventory optimization and transportation costs.
Asian Paints sources raw materials from both domestic suppliers and a set of international vendors from various parts of the world, and the...
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