Parbury Building Products

Best Supply Chain Project Award from SAP

Parbury acquired Furniture Hardware Supplies (FHS) to extend its range of building products and to develop a one-stop supply capability within its market. After the acquisition of FHS, it became obvious that Parbury FHS would not be able to exploit the potential benefits of this acquisition without a comprehensive review and redesign of the supply chains of both organizations.

The Solution

The two entities were consolidated, redundant warehouses and processes in the supply chain were identified and eliminated, and the information systems were merged.

The supply chain management review process was conceptually guided by the SCOR model and SMT Consulting’s constraint management model. The constraint management model is based on the theory of constraints and focuses on capacity management and the optimization of the flow of products. The key objective is to achieve lower inventory levels, higher throughput, and shorter lead times through the improvement of the production flow by optimizing the utilization of bottlenecks.

The key goals associated with the supply chain management project included enhancing the ability to respond to customer requirements, improving market share, and reducing costs throughout the operation. This meant reducing order-to-shipment cycle times, improving product availability, and enhancing on-time and in-full delivery performance. With regard to costs, the following changes were paramount: reducing inventory (25%), reducing warehouse rental, labour, and freight costs, and improving factory utilization and throughput.

The Bottom Line

Pabury FHS set rigorous performance targets and has clearly achieved them through its supply chain project and the implementation of mySAP SCM.

“The results speak for themselves in the sense that the implementation has brought a real improvement to the way the business operates. Customer service levels are up, the inventory has been reduced, and significant costs have been stripped out of the business.”Neil Freeland, CEO of Parbury FHS and the main project champion.

Results achieved:


  • Inventory was reduced by 33% within 1.5 years, while stock availability increased significantly.
  • The application of the theory of constraints has resulted in better capacity utilization and an increase in manufacturing throughput by 20%. In certain cases, production lead time has been brought down by 40% and make-to-stock products can usually be delivered one day after the order is taken.
  • Forecast accuracy improved significantly, over time this reached 98%
  • Parbury FHS reduced overall supply chain operating costs by 10% within 1.5 years

For more information please download the Case Study pdf Parbury Building Products

Also available is the University of Tecnology full report> Download pdf