AGCO’s Missouri parts distribution center expands
Waiting for a part can make for a stressful situation. The faster you can get your hands on a part, the sooner you can get back in the field.
With the recent expansion of its distribution centers, AGCO Parts is focusing on being able to deliver 900,000 active part numbers faster.
AGCO Parts has eight parts distribution centers (PDCs), located in Batavia, Ill; Dallas, Texas; Harrisburg, Pa.; Stockton, Calif.; Stone Mountain, Ga.; Independence, Mo.; and two locations in Canada—Regina, Saskatchewan, and Kitchener, Ontario.
This past spring, AGCO expanded its Independence facility, making four of the eight PDCs "fully stocking," which means the inventory includes the majority of the parts requested by customers in the area.
"Up until three years ago, we only had one fully stocking PDC. Almost every year, we invest more in our parts systems," says Bob Crain, AGCO Corporation senior vice president and general manager for North America.
Crain says the expansion of PDCs is part of the company’s overall plan to grow its business in North America. "These projects provide the tools to our dealer network to provide best-in-class parts to farmers," he says.
For AGCO’s 230 dealers in Missouri and surrounding states, delivery times will be reduced. Joe DiPietro, director of supply chain for AGCO Parts North America, says 70% of the parts needed by these dealers will be shipped or picked up from the Independence PDC.
Cave of parts. The Independence PDC is unique, to say the least. It is 140' underground and housed in the Carefree Industrial Park, a massive cave that was dug out for concrete and asphalt production in the mid-1960s. AGCO has been in the facility since 1993 and is one of 22 tenants.
In total, the Carefree Industrial Park has 4.2 million square feet of storage and warehouse space, but DiPietro says more is always available. "Any time we need additional space, I just call the landlord and they blast to the left of us, which will allow us to expand indefinitely down here."
DiPietro says one of the challenges of working underground is that cell phones don’t have service, nor do the wireless units that are often used to tag equipment and parts. Instead, employees must use a hard-line management system to catalog the parts and their location.
For the April expansion, the facility wasn’t enlarged but was better organized with more inventory, says Hans Lehmann, vice president of AGCO Parts North America. "We had enough total footprint, we just weren’t using it in the best way," he says.
By changing the layout of the racks in the facility, inventory was increased by 40%, which called for bumping up the work force by a third. The Independence depot now holds more than 100,000 individual parts and $100 million in parts inventory.
Around-the-clock service. DiPietro says there are primarily two types of parts orders: emergency and stock. Stock orders replenish dealership inventory, while emergency orders typically get a machine back in the field.
"We keep the building open from 8:30 a.m. to 8:30 p.m. But we have an after-hours service when parts are needed at other times," DiPietro says.
With the after-hours service, farmers can drive to the facility at almost any hour of the day or night to pick up a part. Additionally, dealers can order parts late in the day and have them delivered early the next morning.