Picard GmbH & Co. KG

Description

The largest bearing distributor in Europe for spare parts serves their orders in less than 24 hours from a small location, Bochum, in Germany to 95% of its customers, located as far away as the United States. In its value proposition, a clear transition from "sale of products" to "offer of services" is observed, since there are several unique services offered to its customers; among them, speed and assortment (45,000 SKUs and 50 million euros of inventory for a company that sells 100 million). The company is considering whether it should open an additional warehouse in the United States to serve the Americas and increase its sales.

Learning Objective

The case can be taught in two ways: 1) with an operations management focus, the case offers the possibility of assessing the cost of decentralizing inventory, which in the specific decision presented is "make or break". Thus, it can be used to explain the "pooling effect"; and 2) with an operations strategy focus, to understanding if the steps in the area of servitization (i.e. a transition from selling products to rendering various services) are appropriate and well aligned with the strategy of the company.

Keywords

bearings Distribution Germany Picard Supply Chain wholesaler