Polaris Case Study
Roseau Main Plant
301 5th Ave SW
Roseau, MN 56751
218.463.2312
MEMO
Date: 3/2/2015
To: Supply Chain Department Polaris Industries
From: SCM 520 Consultant
Siddarth Gupta
RE: Supply Chain Optimization Analysis
Current Situation
The economic landscape of the United States is currently changing. The demand for our products has been declining since the year 2008 and is forecasted to remain low for the foreseeable future. In order to proactively approach this changing economic landscape Polaris Industries needs to look into reducing manufacturing expense by shifting some manufacturing to lower cost nations. We have identified Mexico and China as two viable options and have analyzed the total cost of ownership for running each operation. There are unique benefits to both locations however it is immediately clear that cost savings is the immediate gain. This is the number 1 priority is the reason that we are choosing to take an in depth look at outsourcing our manufacturing to these two international locations. The amount of skilled manufacturing labor in the United States is becoming increasingly difficult to find as trade schools and community colleges loose funding. Furthermore, the locations that Polaris Industries conducts our final assembly operations are not located near the talent that we require. This makes hiring effective skilled labor more expensive for us. Polaris Industries also must realize that future demand from the LCCs that are being considered is on the rise. Establishing a worldwide footprint will accomplish multiple goals. It will make future demand fulfillment in emerging markets much cheaper and establishing a presence in an emerging market will increase our brand recognition so when the demand for off road vehicles arises in these countries Polaris will be a name that comes to mind for the consumer. Lastly, Polaris Industries has had a long time strategy that communication lines to manufacturing operations are a cornerstone of product
301 5th Ave SW
Roseau, MN 56751
218.463.2312
MEMO
Date: 3/2/2015
To: Supply Chain Department Polaris Industries
From: SCM 520 Consultant
Siddarth Gupta
RE: Supply Chain Optimization Analysis
Current Situation
The economic landscape of the United States is currently changing. The demand for our products has been declining since the year 2008 and is forecasted to remain low for the foreseeable future. In order to proactively approach this changing economic landscape Polaris Industries needs to look into reducing manufacturing expense by shifting some manufacturing to lower cost nations. We have identified Mexico and China as two viable options and have analyzed the total cost of ownership for running each operation. There are unique benefits to both locations however it is immediately clear that cost savings is the immediate gain. This is the number 1 priority is the reason that we are choosing to take an in depth look at outsourcing our manufacturing to these two international locations. The amount of skilled manufacturing labor in the United States is becoming increasingly difficult to find as trade schools and community colleges loose funding. Furthermore, the locations that Polaris Industries conducts our final assembly operations are not located near the talent that we require. This makes hiring effective skilled labor more expensive for us. Polaris Industries also must realize that future demand from the LCCs that are being considered is on the rise. Establishing a worldwide footprint will accomplish multiple goals. It will make future demand fulfillment in emerging markets much cheaper and establishing a presence in an emerging market will increase our brand recognition so when the demand for off road vehicles arises in these countries Polaris will be a name that comes to mind for the consumer. Lastly, Polaris Industries has had a long time strategy that communication lines to manufacturing operations are a cornerstone of product