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Realising the real value

01 October 2007
Globalisation and severe competition are increasingly affecting the way businesses operate. As a result, companies across most industries have begun internal projects focusing on optimising the supply chain, securing quality and reducing both various internal costs and transaction costs to expand in their markets. Danfoss is no different and we are constantly exploring ways to help our customers reduce their costs. One such project is our Total Supplier Concept for Marine industry customers.

Driving down costs, driving up efficiency

Using the experience from our own internal optimisation processes, we launched a Total Supplier Concept for selected Marine customers in 2005. Through our comprehensive product range within Industrial Automation – including a wide range of valves, pressure switches and sensors, temperature switches and sensors – we were able to offer significant cost reductions. The Total Supplier Concept proved a success and we are now ready to continue the roll-out.

The savings are not just limited to our products. The Marine trial also demonstrated huge potential for lowering the operating costs of our customers. By reducing the number of suppliers, our customers have experienced a major reduction in costs for order handling, delivery receipts, etc. But costs connected to maintaining a supplier base also have to be taken into account. Fewer suppliers mean less expenditure on supplier visits, negotiations, and account maintenance costs.
Danfoss products in the Marine industry
An integral part of the concept is that we also enter into a close dialogue with the technical/engineering department of the customer to optimise the performance of the application and rationalise the number of variants used. Fewer and dedicated variants mean less costs for component database maintenance, documentation production, and service and warranty costs.

Our target is satisfied customers with whom we can develop a close relationship over time, lowering total cost of ownership, and creating value for both parties.



By Per Sønderriis, Sales Support Manager

Value for customers

Reliability and product quality is a sound basis for delivering best total cost. This, together with strong technical solutions and knowledge of your application and industry, mean Danfoss can be a valuable partner.

To stay ahead, we are applying the principles of Lean Thinking throughout. Through empowered people, eliminating non-value creating processes in all aspects of our business, we are continuously reducing lead times and responding with speed and innovation to customer needs.