$300+ Million Risk Averted: How FHI Helped AMS Osram Sylvania Create Stability and Avoid Losing Business

In February 2022, countless companies were still reeling from the effects of the COVID-19 pandemic. Supply chain businesses in every industry were trying to catch up on almost two years’ worth of backlogged orders. Many of these were also facing a potentially devastating future: millions of dollars in revenue losses due to fines or lost business.

Among these companies was AMS Osram Sylvania — a major after-market lighting fixture company that caters to auto parts retailers across the country. They were facing significant challenges keeping up with customer demand with a diminished workforce. Given the scale of their business and customer contracts, these challenges put significant business at-risk,  to the tune of $300 million.

The Problem

Osram Sylvania faced significant labor shortages and trouble managing their inventory in their fulfillment facilities. They were struggling to keep up with demand as their workforce dwindled, which led to empty shelves in retail stores and angry customers. 

In addition to their customer service problems, they were also facing fines of more than $1 million per month for their inventory discrepancies. Finally, there was $300+ million of long-term business on the line due to unreliable order fulfillment and inconsistent customer service. 

In short, Osram Sylvania was bleeding money each month and stood to lose a whole lot more if they didn’t find a way to get themselves back on track and reliably fulfill orders.

The Solution

Osram knew they couldn’t handle this sizable problem on their own, so they reached out to FHI and employed our FHI Now on-demand labor service. In this service, we deploy a team of experienced associates who can make a positive impact from day one. We also send an on-site manager with an average of 5 years of experience to coordinate our team and ensure they meet customer expectations.

Within 72 hours, we assembled a full-trained 12-person crew and sent them to Osram’s facilities. The team included:

• Order picker operators
• Order selectors
• Warehouse material handlers
• On-site managers

Our goal was to create stability in the business by improving facility processes and enhancing efficiency throughout the warehouse. The team partnered with Osram leadership to evaluate and propose changes to their operations. 

After eight weeks of working together, Osram’s systems were back on track, deliveries were going out on time, retailers’ shelves were restocked and the company had dodged a $300+ million bullet.

The Results

All of the long-term business previously at risk was stabilized after the eight-week engagement. Additionally, they saw a $1 million per month revenue increase because they eliminated fines and inventory discrepancies. 

“Without the help of FHI, the progress we’ve seen would not have been realistic, or even possible,” said Todd Craig, Logistics Senior Manager for Osram Sylvania. “The contingency crew provided the boost we needed to get moving in the right direction, helping us stabilize a major portion of our North American Automotive business.”

Sometimes you need a helping hand to get your business back on track. Get in touch with us to learn more about FHI Now and how on-demand labor services can help your supply chain business.