Everyone loves a good find.
Now that Game of Thrones is over, fans rewatching the series and savoring all its details are discovering a treasure trove of tantalizing tidbits that they may have overlooked the first time around. Such as John Snow’s parents’ initials carved into the backdrop of a scene in episode 4 of season 1; Coldplay’s drummer, Will Champion, cameoing in the “Red Wedding” episode; the former president whose head rests on a spike next to Ned Stark’s; and, of course, the now-famous plastic water bottle that was mistakenly left in sight during filming of the series finale.
Yes, GoT fans have their finds, and companies with international service supply chains have their own in the form of No Trouble Found (NTF). These are purportedly defective products that have been returned for hopeful repair, but test-and-screen services find nothing wrong with them. In such cases, these products can be placed back into usable inventory immediately, ready to be deployed at a moment’s notice. Finding NTF parts in region, so that you can get them back into stock fast, is a golden ticket that’s waiting to be discovered in your global service supply chain. Identifying NTF products can save your company big money and that’s only the beginning of the benefits that include supporting an excellent customer experience (CX), protecting and bolstering your brand, and enabling successful expansion into new territories.
Read on to learn how to sharpen your test-and-screen processes to find the hidden gems in your returns program faster and win in the game of NTF.
Returns Models Hide Inefficiencies (and Hidden Treasure)
The tremendous waste of time and money in the traditional returns model provides a fantastic opportunity to save time and money. Global tech companies fulfilling service level and warranty agreements around the world tend to operate a slow and costly process for dealing with their defective returns. It involves collecting their returns at a distribution center where they sit until a sufficient scale is reached to ship the product back to a contract manufacturer — often in China or Mexico. There, it goes through a test-and-screen process and is repaired if necessary. When NTF product is found, it just gets shipped back to the country it came from.
10-50% of Returns are NTF and Ready to be Restocked
Relying on a faraway contract manufacturer to rescue your NTF products is hugely expensive, especially when multiple legs of transportation are involved. In addition to the freight and potential customs charges associated with the move, the contract manufacturer likely charges a fee. And don’t forget the opportunity cost of having that perfectly good part out of service for weeks on end. Oh, and there’s another biggie, the potential of letting your customers down with unnecessary downtime.
There’s Big Money to be saved by Finding NTF Locally
Just being able to do a diagnostic Go/No-Go test at an in-country or in-region return location would enable you to filter out your NTF and reduce your total freight to and from the contract manufacturer, as well as well as all the related costs for returns, by up to half.
In the case of one manufacturer of enterprise mobile equipment, Flash was able to add a test-and-screen process at the distribution center and found 25% were NTF.
Early Detection Reduces Direct Labor Costs and Inventory Carrying Costs
By identifying NTF and getting it directly back into your usable inventory, you eliminate all of the “touches” during every leg of transportation that it otherwise would have been subjected to on its journey back to the manufacturer or contract manufacturer. Plus, there’s the labor of the contract manufacturer’s techs who are typically pulled from making new products to do repairs, which ultimately eats away at revenue.
Fast-tracking NTF parts back into your stock that’s available for fulfilling on warranties and service level agreements helps you manage your inventory more efficiently and cost-effectively. With an increased flow of good parts coming into stocking locations from NTF, you can hold less inventory to mitigate the risk of running out. That reduces your holding costs as well as your operating expenses related to managing supplies.
Replace with NTF Stock, not Expensive New Parts
With good NTF stock being added back to your shelves quickly and consistently, you reduce the chances that you’ll have to buy new parts to meet your service level agreements (SLAs). As the economy shifts, play close attention to how this can keep your bottom line from plunging. This alone is a game-changing benefit; having to send out new parts is an expensive solution that can beat down your bottom line and make your CFO crazier than the mad king. For example, replacing a server that has been returned with a new unit is 60% more expensive than replacing with refurbished inventory, according to Marty Walsh, Flash Global’s Sr. Director of Business Development for Technical Services.
Finding NTF Fast Benefits Your Brand and So Much More
Successfully expanding internationally and building brand reputation is largely contingent on how you perform on your SLAs. Turnaround time (TAT) is the most visible measure of how your returns strategy is working. To perform, you need to minimize stock-out situations. Having NTF stock ready to replace defective returns helps you fulfill on the promises you made to customers. It also enables you to support feats like 2-hour TAT for mission-critical parts.
As companies move into new regions, promoting and protecting the brand is how you win the throne. Your reputation is built through CX, i.e.: goodwill and consistency. Implementing local test and screen to identify NTF fast is a strong pillar of any global returns program. Not having to ship back to a contract manufacturer reduces your exposure to delays caused by loss, damage and theft, too. And having a ready supply of inventory also makes you better prepared to react quickly to changes in demand — and that reflects positively on your brand.
Implementing Local Test–and-Screen Processes doesn’t have to be a Battle
Essentially, you need to be in-country or in-region in order to shorten the distance of your service supply chain and minimize the transportation legs your returns travel. You also need expert personnel who can perform test and screen.
Setting up shop from scratch in every country where you sell isn’t practical for most global manufacturers, but if you already have stocking locations in your customer-countries, you could begin performing test and screen with the addition of a technical staff.
This is in contrast to what most manufacturers — especially in tech — believe. You in no way need to partner with a technical services company, and you don’t need a clean room with highly-trained Level 4 techs. Level 1 or 2 technicians can often be taught to do inspections and operate diagnostic equipment in a modified warehouse environment. For this role, a logistics partner who can staff for the technical aspects is usually all you need to find NTF and get it back into inventory as soon as possible.
Considering the potential savings and benefits, the only question isn’t if you should move your test–and-screen operations closer to your customers; it’s how.
Talk to Flash Global about how we can put our global network and expertise to work for you. We provide in-region test-and-screen services, service logistics and trade compliance expertise to some of the world’s largest high-tech manufacturers in a wide range of industry verticals. By partnering with us, you’ll discover that finding the hidden gems in your returns strategy (NTF) can become a money-saving, time-saving, reputation-boosting game you’re quite good at.