Coats turns to SAP to create seamless European supply chain

Integrated global supply chain provides leading industrial sewing thread manufacturer with real time data to help reduce costs, release stock, and improve customer service

LondonCoats Ltd, the global leader in thread for industrial and consumer use and second for zips has implemented mySAP Supply Chain Management (mySAP SCM) to support its new European supply chain across 10 European countries. The new solution implemented by SAP Consulting is providing Coats with real-time updates from apparel manufacturers about customer demand. This will allow for accurate scheduling, production and product forecasting enabling better service for the company with reduced stock. SAP Education is providing training and technical support to the central staff.

As a world leading manufacturer and supplier of industrial sewing and embroidery threads, Coats demands constant visibility of its stock to ensure it can meet customer orders. With 12 European operations in total and more than 900,000 sales order lines per year, the SAP solution will support Coats’ demand planning for more than 30,000 individual products.

The optimiser engine for medium term planning, currently helps determine the optimum supply plan for over 3000 products. Coats also uses the detail production scheduler optimiser engine to produce a schedule of over 250 production orders daily in its bulk supply plant, using a matrix of penalty costs. Both these optimiser engines help improve production efficiency and effectiveness and thereby achieve its lowest conversion costs for Europe.

With the capabilities of mySAP SCM, the company benefits from a real time, integrated and customised view of all relevant data. This allows Coats to position the right product in the right quantity at the right time across the supply chain. The new supply chain consists of customer service units handling unpredictable items produced close to the market on a made to order basis. In addition there is a bulk production unit, handling ‘medium’ predictable items produced in a bulk production factory in Europe and a low cost unit handling ‘highly’ predictable items produced and sourced from Asia. SAP has enabled the company to evolve from the traditional inter group business to a single integrated and streamlined supply chain.

“We need to ensure a responsive and agile European supply chain able, to respond to the highly variable product demand and short lead-times of the apparel industry, delivering excellent value and service to customers locally,”said Hizmy Hassen, European Supply Chain Manager. “SAP has enabled us to move away from a country / order based supply chain to effective pan-European demand planning and integrated supply planning. We are consequently expecting to reduce 30% of our stock”.

SAP Consultancy is working with Coats to ensure a smooth implementation and helping the company transition its supply chain from country based supply to an integrated supply chain, without any loss of sales and disruption to business. The IT project also managed by the supply chain team, will be rolled out to Asian markets by middle of next year. “We run global operations and need to deliver world class quality products on time, at low cost.” said Brian Seifried, Global IT Management Director for Coats. “For such a key project we wanted SAP as a project partner and naturally decided to use SAP Consulting to most cost effectively roll out the new solution”.

“We are delighted to be supporting Coats to heighten its competitive advantage and empower its organisation to continue to deliver exceptional value to its customers and achieve sustainable growth and profitability,” said Paul Eggleton, Business Development Manager, SAP UK.