Changes in store

21 May 2013

An extensive nationwide inventory management project by Brammer has delivered more than £2m in cost savings for Tata Steel Europe (TSE).

With 20 production sites across the UK, including two major manufacturing hubs in Port Talbot and Scunthorpe, TSE felt that standardised stores processes could deliver both time and cost savings. Brammer was appointed to deliver MRO supply, inventory and value creation propositions associated with  bearings and other engineered products. 

TSE’s decentralised UK MRO stores management had inventory levels in excess of 700,000 SKUs, due in part to multiple descriptions being used for the same item at different sites. Employees were not always able to establish whether an item was in stock locally or at another location, leading to unnecessary ordering.

Brammer began with a full audit of each stores operation. Focusing on bearings, the team viewed 26,000 SKUs and validated every item with a clear description, selling or scrapping obsolete bearings, or those no longer fit for purpose. Brammer identified 2500 SKUs as being available within 2-5 working days, so many items did not necessarily have to be kept in stock.

Chris Ditton, programme manager – stores transformation at Tata Steel, explained: "Our partnership with Brammer has so far delivered £2.2m of cost savings opportunities. However, due to the sheer scale of our UK operation, we estimate that in the last two years we’ve extracted only around 20% of potential cost savings.