Foton Motor prepares for business growth with Manhattan Supply Chain Platform

• Functional Applications - Warehouse Management Systems (WMS)
• Application Infrastructure & Middleware - Data Exchange & Integration

• Automotive

• Warehouse & Inventory Management
• Logistics & Transportation

• Inventory Management
• Warehouse Automation
• Supply Chain Visibility

• System Integration
• Software Design & Engineering Services

Foton required a sophisticated warehouse management solution that could manage critical warehouse processes from receipt to dispatch and ensure a consistent level of order accuracy. The company had developed its own IT system in 2005 to replace a previously manual operation, but it was unable to deliver the required levels of inventory accuracy and operational efficiency. Additionally, it lacked the functionality to support key processes such as product packaging and stock allocation. The inability of the old system to scale up to support Foton’s business growth was also an issue. Given the company’s ambitious expansion plans and the increasing requirement for timely and accurate distribution, Foton recognised the need to replace the outdated system with a proven IT systems platform that could provide a strategic advantage over its competitors.

Founded in 1996, Foton Motor Inc. is the largest commercial vehicle manufacturer in China, with a market value of nearly 30 billion yuan ($US 4.7 billion) and 40,000 employees. Headquartered in Beijing, Foton has sales branches across the country. To support its manufacturing business and after-sales service, Foton invested more than 2,000 million yuan ($US 320 million) in building an extensive network of auto parts distribution centres across the country. The company has set up three provincial distribution centres in Beijing, Guangdong, and Shandong, as well as another 60 regional distribution centres in other parts of China. The auto parts distribution network comprises 700 exclusive auto parts retail outlets and franchises in more than 3,500 service stations. Over the last few years, Foton has recorded impressive business growth and has become one of the top commercial vehicle manufacturers in the world. As part of its ten-year strategy, the company aims to expand its operations to emerging markets including India, Russia, Brazil, Mexico, and Indonesia, and achieve market breakthroughs in North America, European Union countries, Japan, and South Korea.

After careful evaluation of various warehouse management solutions available on the market, Foton selected Manhattan SCALE: Supply Chain Architected for Logistics Execution to manage its auto parts distribution centres. Built on Microsoft® technologies, Manhattan SCALE boasts a powerful set of supply chain solution components and sophisticated logistics support capabilities, including Trading Partner Management, Yard Management, Optimisation, Warehouse Management, and Transportation Execution. The platform can quickly scale up or down to match market conditions and seamlessly interfaces with Foton’s existing ERP system, protecting its existing IT investments. The ERP system receives all sales orders and checks for inventory information before passing the relevant data to Manhattan SCALE, which manages the whole order fulfilment process. The Manhattan Associates team conducted an in-depth analysis and assessment of Foton’s overall business, people management processes, and technology standards for auto parts, and successfully deployed the new platform at its distribution centres in Beijing and Shandong. The team will continue to monitor the system’s performance and provide advice for sustainable optimised services after the implementation.

• Improved operational efficiency and automation: With the implementation of Manhattan SCALE, Foton has seen significant improvements in operational efficiency within its distribution centres. The system allows any well-trained employee to handle product allocation by simply following system-directed instructions, reducing reliance on a few experienced employees.
• Streamlined warehouse management: Manhattan SCALE automatically assigns products that need to be wrapped or packaged for shipment, directs products to be put away in the optimum pick location, and optimises the whole put-away, picking, and packing operation to minimise travel time between tasks. This has led to instant improvements in processing increased shipping volumes, achieving higher levels of inventory and order accuracy, and improved labour productivity.
• Optimised labour allocation: The new system provides accurate and clear directions for resource and labour allocation, resulting in a more efficient and less labour-intensive process.

• Total capacity of over 1.08 million sq. ft. (over 100,000 sqm) in auto parts distribution centres.
• Investment of more than 2,000 million yuan ($US 320 million) in building the distribution network.
• Market value of nearly 30 billion yuan ($US 4.7 billion).