Table of Contents

Introduction: .......................................................................................................................................... 3 Theoretical analysis: ................................................................................................................................ 4 The Swot Analysis ................................................................................................................................ 5 Cost opportunity: ................................................................................................................................ 5 The Vernons life cycle Model: ............................................................................................................ 6 Kanban and Just-in-time Theory ......................................................................................................... 7 MRP and ERP system: .......................................................................................................................... 8 The Business transformation before and after 1992: ........................................................................... 10 1992 The European market openness and the supply chain process ............................................... 10 The European commission and 1992: A significant turn:.................................................................. 11 Implications of the European Union green policy and the logistic-supply chain process:................ 14 The supply chain of the Future:............................................................................................................. 17 New trends in Supply Chain Technology ........................................................................................... 18 RFID (Radio Frequency Identification)........................................................................................... 19 The Business Process Management (BPM .................................................................................... 20 The Business Intelligence: (BI) ....................................................................................................... 20 The Simulation Modelling: ............................................................................................................ 20 Differentiated table of Bar code and RFID .................................................................................... 21 The Aqualux Company:.......................................................................................................................... 22 History of the company: .................................................................................................................... 22 The Logistic and Supply Chain Process of Aqualux :.............................................................................. 25 The Shipping Process ......................................................................................................................... 25 Aqualux and logistic and supply chain Theories.................................................................................... 26 The Aqualux Value Chain: .................................................................................................................. 26 The Aqualux Just-In Time and Kanban method................................................................................. 28 Aqualux and Porters generic: ............................................................................................................ 29 The Implication of the SEM for Aqualux: .......................................................................................... 29 The ERP system of Aqualux ................................................................................................................... 29 SWOT Analysis of the company:........................................................................................................ 32 The Aqualux Supply chain Process and its future evolutions: ............................................................... 33 The Supply Chain Process of Aqualux:........................................................................................... 33

Conclusion: ............................................................................................................................................ 36 Appendix2: Aqualux: An international designer and manufacturer for swimming pool, spas and water equipment. ............................................................................................................................................ 39 References: ............................................................................................................................................ 50

Introduction:
Supply chain management is a system, which involves people, new technology and information with the resources and activities of the company in order to move a product or a service from supplier to customer. Nowadays, companies are taking into account this process seriously because logistics and supply chain management allows firms to correct specific values, eliminate wasteful steps of the former process, flow where you can and Pull where you cant. Indeed, the aim of the supply chain process is for companies to have a management system toward the perfection. Thus, the Supply chain is driven by 5Rs in order to deliver the right product at the right time with the right quality and the right price in the right place. Supply chain management goes hand in hand with the logistic concept. Logistics has existed since the beginning of the 2Oth century. First and foremost Logistics is associated with military management, in order to ensure the availability of required material at the right place and on right time. The real take off of this process into company production process accelerated in the 1980s with the Rules of 3D and the Single European Market in 1992. Indeed, in the 1980s companies realized the necessity of evolving their logistic and supply activity into one management process which will be more efficient: The Supply chain Management. Nowadays the logistic and supply chain management is totally integrated into the organization of the company. Its even the cornerstone of the company production process. In order to apply this concept to the real world, we will use the example of Aqualux, one of the leading companies in the French and European Market. On further explanation, an analysis will be drawn on the impact of the European green policy in the logistic and supply chain management.

Theoretical analysis: Porter Value chain:

Source : Ghemawhat , Strayegy and the Business landscape, 2002.

The value chain developed by Porter can help us to analyze deeply how a company succeeded in its supply chain management in order to create value and competitive advantage. Indeed, we can see above that logistics and supply chain management are primary activities in order to reduce cost and create value for the firm. A firm can create a cost advantage by 2 ways: Reducing the cost of its main value chain activity or by reconfiguring all the value chain. This theoretical analysis emphasizes well on the fact that the supply chain management is one of the main important tools for a company to have significant competitive advantage because it allows the firm to reduce cost due to its ability in reducing waste and using the best shipping service for the company. Furthermore, managing logistics and supply chain requires the company to take into account opportunity cost between one product and another in its production and transportation process.

The Swot Analysis: It is a powerful tool for companies to scan the internal and external environment of the company, the product and the market. The four components of this Theory are Strength (resources and capabilities of the company), Weaknesses (absence of some strength), Opportunity (external opportunities allowing profits and growth), Threat (External threats for the company). This analysis will be used for studying how the Logistics and Supply chain network of the company is.

Swot analysis

Internal analysis

External analysis

Strengths

Weaknesses

Opportunities

Cost opportunity: Indeed, proceeding to an opportunity cost it is for a company to balance what is the main benefit strategy in order to make many profits and reduce at the maximum its wastes. The opportunity cost can be highlighted by consumer choice, production possibilities, cost of capital, time management, and career choice and obviously the analysis of comparative advantage. An opportunity cost is designed by this kind of curve.

The Vernons life cycle Model: The aim of most companies is innovation, the Vernons life cycle is quite interesting in the case of logistics and supply chain network because it shows how companies incorporate the importation of a product which was product before by the company. Schumpeter analyzed capitalism and said that when a country changes, the innovations change. He emphasized on the importance of the innovation process pulsed by the entrepreneur innovator and ruled by a phenomenon called: Creative Destruction. There is an emphasis on the importance of the innovation for the growth of a country and consequently for a firm. Hence, we can see the significant role of the innovation in the international business environment which procures a serious drawback to companies. Indeed, as, technology is a public sector shared by all countries, the innovation procures to firms a real but temporary competitive advantage. The first man who analyzed this was Posner. The innovation is born in a modern country because he has a competitive advantage in the technology sector. So, first the product is developed for the national market and then it is exported to countries which are structurally the same. Once diffused to these countries, the diffusion is slower and then it is extended all around the world. Additionally, few years later Vernon made a deeper analysis of Posners theory in elaborating the Product lifecycle into 4 steps: 1- Elaboration and test of the product. 2- Sales boom of the product. 3- Standardization of the product and its diffusion in the world. 4- Decline. First, the product is born into a dominant country. Then, the firm diffuses it for its national market and exports it in countries where the demand is structurally close. After this diffusion, the product is standardized and generates price competitiveness. Finally, the dominant country produces less and less and prefers import the initial product in order to focus into a new innovation product, source of competitive advantage

Kanban and Just-in-time Theory: It is a Japanese method associated to lean production and just in time process in order to trigger action through a signalling system. Traditionally, it used cards to indicate the necessity for an item. Company use this tool because it is a helpful tool to support the production process as an entire process. Kanban is effective because it is driven by a pull system. Due to the pull system, Kanban allows to firms to respond quickly to the demand forecasted. Indeed, it is like a demand signal, which is instantaneously reported to the supply chain network. Therefore, Kanban is similar to the Just in time process as it permits firms to ensure the management of their intermediate stock efficiently. Indeed, just in time is also a pull system of production. The specificity of this system is that companies are producing only what consumers are requiring in the right quantity and at the right time. This system maintains a minimum of stock and raw level in order to avoid waste. However, in order to become efficient, this system needs to be carefully implemented in scheduling and the planning production process. Therefore, a company involved into a just in time process can deliver directly the customer from its supply chain. This increases a faster delivery process and reduces the number of intermediaries. Furthermore, information between supplier and customer can be shared with electronic data interchange for better information sharing and security.

Just in time advantages Reduction of storage space Saving waste and insurance cost Not much use of capital Few perishing stocks or obsolete stocks. Avoid over stock production.

Just in time disadvantages Minimum stock levels therefore few mistakes are authorised. This process is too dependant on the right time delivery. No spare finished product available.

MRP and ERP system:

The MRP is a system for forecasting or projecting component part & material requirements. It permits Connection between the purchasing and the manufacturing activities. MRP plans out: Type of material and the quantity of purchasing. Type of material manufactured internally. At what time to place the order. The Aim of MRP: Based on an endless of production capacity. Mathematical planning tool driven by Master Production Schedule ( MPS).

Answer to this burning questions: What items are required? How many are required? When are they required? The MRP system has been complemented in the 1980s by The DRP system which is a method for forecasting, calculating and summarizing the order requirements within a distribution network. It allows companies to Ensure the product at a right location, a right date and a right quantity, define the amount of stock needed for near future demand and minimise or maintain safety stock.

Nowadays, most of companies manage their stock with the ERP system. Indeed, the ERP system is an enterprise-wide information system to coordinate all your resources, information and technologies in order to be as efficient as possible. First, ERP was an extension of MRP but nowadays, ERP is covering all core functions of the company such as product lifecycle management, supply chain management, logistic, warehouse management. To conclude, the ERP is powerful to efficiently manage your production process.

The Business transformation before and after 1992: As mentioned above, the new rules of the competition are driven by flexibly and rapidity. This fosters a shift from high supplier power to high buyer power. The consumer power is highlighted by the 4R which are: responsiveness, reliability, resilience and relationship. Due to this change, the globalization of industry has generated shorter product life cycles and the supply chain has become vital. Thus, to enable the potential benefits of global network to be fully realized, a wider supply chain perspective must be adopted. Moreover, the learning and experience effect generated a decrease of costs but also an overcapacity of stock in many industries.

1992 The European market openness and the supply chain process :
Over the past two decades, our business landscape has turned into a new globalised world. In 2006, world good exports reached around $12 trillion, which represents almost 30% of the world GDP. This increase of marketing development is due to the awareness of companies, who realize that building worldwide relationships is vital for growth. In a global market, companies have to understand that they are not competing solely as an individual, but as a whole supply chain activity. See below the two factors which underlie the increase of globalization: Global reaching is very important to a firms survival (H.Lee and C.Lee, Building supply chain excellence in emerging economies,2006) The growth of Multinational firms.

The increase of globalization can be explained through four major driving forces, these are:

Global Market forces Technological forces Global cost forces Political or macro economical forces.

The latest force is a very significant one, as it shows that the fluctuation in currency rates can be an opportunity as well as a threat for a company entering the globalization process. The interesting thing is the fact that regional trade agreements such as NAFTA and EU highly influence decisions made regarding the globalization process.

EU and NAFTA generate serious implications for the way firms will structure or rationalize their global manufacturing network.

(H.Lee and C.Lee, Building supply chain excellence in emerging economies, 2006). Regionalization allowed cutting down tariffs, duties, and non-tariff Barriers to create better free trade. This created multiple opportunities for MNEs. However, non-tariff barriers are still used by some local governments in order to favour domestic producers. This doesnt apply to Europe, where since the single market creation in 1992, all non-tariff barriers were abolished. Consequently, operations across borders became easier for the logistic and supply chain management of MNEs. Since the creation of the unique act approved in 1986 and the Maastricht treaty in 1992, firms could develop and expand their business all around Europe easier than ever before. This change in the European policy has permitted companies to better their unionization of the logistic and supply chain network, mainly due to the free policy of trade and non-trade barriers.

In the past, Europe was a vast market for logistic, services, transport and warehousing. In the last decade Europe has changed a lot from freight transport deregulation, logistic needs of manufacturers and retailers to planning controls on infrastructure development. These changes were made possible due to the integrated European market.

The European commission and 1992: A significant turn:

The Cecchini report stated a rise between 2.5 and 6.5% in output within the European Union. The Single European Market allowed an increase in the demand for logistic services (transport and warehousing). Besides this there is the expected growth in GDP, which could open new opportunities for user and providers of logistic services. For this reason, the European commission sponsored numerous of research programs in order to make the European industry more competitive and promote the cooperation between European countries with a North-South Vision. Furthermore, the Single European market is planning two projects in order to develop a more efficient logistic process: Fleet (cab technology for Lories) and Eurofret (Freight exchange system, customer clearance, vehicle routing and scheduling).

The European industry and SEM:

Serie 1
Uk Portugal Netherlands Luxembourg Italy Eire France Spain Greece Germany denmark Belgium 0% 500% 1000% 1500% 2000% 2500% 3000%

Srie 1

Figure1: The European Industry in the SEM, Cooper,J European logistics Second edition. The SEM gave companies significant opportunities regarding freight and movement of goods. This is a result of technological harmonization, standardisation of laws and deregulation of road freight transport (deregulation of international haulage). All these changes generated eased functioning of the market and increased the competition within the domestic market. It accommodated the change to open procurement and a better awareness of the logistic process in business strategy. Because of the SEM, companies can progress from an integration of logistic networks, to an important reduction of its logistic costs, enabling cost efficiency and better productivity.

The SEM stimulated trade between European Union members and third countries, in particular reducing production differentiation, production complexity, increasing the European Brand and Market, and reducing the cost of production and Research and development process. Finally, for European companies, SEM has reduced outsourcing across the European Union and created traffic inside the Union, eg: Traffic creation and destruction. (J. Viner.) Driving forces in manufacturing logistics.

Manufacturing

Trends to global scale in manufacturing

Logistics as the corporate edge

Growth of outsourcing.

Focus on core business

Rationalize production and distribution

New manufacturing and logistics techniques

Better Use of inventory

increased importance of logistics.

Figure2: Driving forces in manufacturing process, Harris European Business (1999)

Implications of the European Union green policy and the logistic-supply chain process:

Since the ONU conference in Rio de Janeiro in 1992, countries and regionalisation have to take into consideration this burning issue. The European policy has influenced companies a lot in their logistic process. The European directive, based on green policies, is changing the rules regarding the logistics of companies. The main issues are: Transport Waste disposal Raw material supplies Packaging Site Locations Hazardous cargoes

Indeed, gas emissions, noise pollution (airport, roads), waste disposal (packaging), water/marine pollution (oil slick, cleaning out) and biodiversity pollution (the importation of pests) are the most common logistic and supply chain issues, which are difficult to bridge for companies. However, in order to protect our planet, the European Union implemented a green policy for companies and imposed the restrictions shown below: 1. Green paper Towards fair and efficient pricing in transport (CEC, 1995) 2. In 1996, the Commission published the Green Paper Future Noise Policy 3. White paper Fair payment for infrastructure use (CEC, 1998) 4. White paper on Transport Policy (CEC, 2001) 5. Directive on Rail Infrastructure charges (2001/14) 6. Proposal to amend Directive 1999/62/EC on the charging of heavy goods vehicles 7. The EAP 2004: the Common Transport Policy, Sustainable Mobility; Promotion of intermodal and combined transport and environmentally less harmful means (nonmotorised transport, railways, inland waterways and maritime transport). However, this policy has some negative effects on the international transportation process of companies:

It Increases cost, delays and provoke customer dissatisfaction (problems with on time delivery performance/ lead times/ JIT), If it is a perishable good some customer can lose their capital and profits, and If it is an urgent good like chemicals/ medicine companies can lose their prestige or potential contracts. Finally, due to regulations, companies have to adapt themselves including their transport strategies in order to manage their transportation system in an effective way to remain competitive and become efficient for as long as possible. Legal and environmental aspects of Transport are more and more on the agenda because on the one hand it affects the transportation system of international firms whereas on the other hand the competitive edge of firms do not have to destroy the environment. This is why companies have to take into account the environment and apply this to their international transport strategies in order not to lose market shares. For this reason, the economic motor, which has driven transport policy for so long, is no longer appropriate in the context of sustainable development. The green European policy paves the way to a future of sustainable and green logistics and supply chain. Table of some significant treaty and measure for the Union and its impact on the logistic Air 27/09/2005 reducing (Reunion for Reducing climate change

climate

change impact of the aviation. Aim = sophisticate the air traffic control with a fuel tax system.

increased by the aviation)

Rail

2004/49/EC (treaty for the Allocation

of

Railway

safety on the community infrastructure capacity and railway council. and amending the levying of charges for the use of railway infrastructures and safety certification. Water 2002/762/EC (treaty which To ensure adequate prompt authorise in the interest of and effective compensation the community ti sign,ratify of or accede to persons who suffer

the damage caused by spills of oil as fuel in ships

international convention on carrier civil liability for bunker oil bunker.

pollution damage Road 8877EEC (Measure need to be taken against emission of gaseous pollutants.) Lay down limit values for gas emission Reduce on a long term these emission . Find a better solution with manufacturing

of diesel production

However, this policy has some negative effects on the international transportation process of companies: It Increases cost, delays and provoke customer dissatisfaction (problems with on time delivery performance/ lead times/ JIT), If it is a perishable good some customer can lost their capital and profits, If it is an urgent good like chemicals/ medicine companies can lost prestige or potential contracts. Finally, due to regulations, companies have to adapt themselves their transport strategies in order to manage their transportation system in a very effective way to remain competitive and become efficient as long as possible. Legal and environmental aspects of Transport are more and more on the agenda because on the one hand it affects the transportation system of any international firms whereas on the other hand the competitively of firms does not have to destroy the environment. This is why companies have to take into account the environmental and apply them to their international transport strategies in order not to lose market shares. Therefore, the economic motor, which has driven transport policy for so long, is no longer appropriate in the context of sustainable development. The green European policy paves the way to a future sustainable and green logistics and supply chain.

The supply chain of the Future:

Since its creation, Logistic and supply chain are in a constant dynamic. Suppliers had the power due to their ownership of resources, technologies and brands. In contrast, nowadays the reverse situation has operated especially with the reverse logistic. Reverse logistic exist when the product comes from the consumption point to its creation point. This highlights a switch from marketing philosophy to mass marketing served by mass production. Hence, the importance of the reverse logistic for success of companies cannot be denied in the future. Traditionally, the supply chain goal was to maximize firms efficiency and increase economies of scales. Usually, firms are driven by producing large volume and maximize capacity. Basically, in the past the supply chain was ruled by: independent entities, inventory based and low cost production. Currently and in the future, companies focus more on virtual network Information which is customer value oriented. This change occurred due to the necessity of companies to be more agile and cope with rapid change due to a shorter time of reaction this is recommended in order to not lose profits. Harris (1999) emphasized on seven major business transformations explaining the evolution of logistic and supply chain management. 1- From Supplier centric to customer centric: In the past, the factory process were designed by cost reduction and companies were not taking care of customers rather than today, the agility is the key point of logistic and supply chain management.

2- From push to pull: The production push philosophy is replaced by the pull philosophy. A significant example is the Japanese Kanban system that emphasises on demand dependency and it increases the level of flexibility.

3- From inventory to information: Traditionally, logistic and supply chain was focus on planning horizontally the demand prediction and then building inventory. As the evolution of the market has turned into more volatile generates harder predictions, the risk of over or under stocking capacity has been

increased. The future challenge for companies is to enable to become demand driver with an increase of visibility.

4- From transactional to relational: Today, the way is to sustainability throughout long term relationship and in few years ago companies were focused on volume and market share into a transactional orientation whereas in the future, companies need to focus more on customer retention by delivering superior customer services and in reinforcing connection between logistics and customer retention.

5- From trucks to end to end pipeline management: Over the last 2 decades, business logistic and supply chain management were viewed as a concern for transportation and warehousing. The real task of supply chain is for the future to coordinate the wider end to end pipeline emphasized on time compression.

6- From functional to process: At the beginning of the supply chain management, vertical process with multi layered hierarchical decision making was the rule, whereas nowadays, and for the future the issue at stake is the ability for firm to respond quickly to fast changes. Therefore, the new way will be turned into more organisational and management process in order to create much more values for customers.

7- From stand alone competition to network rivalry: In the past firms saw the competition as a single firm whereas nowadays it is not only the firm but all its logistic and supply chain process. According to him, this change should expect a significant growth for the future.

New trends in Supply Chain Technology:

Due to the globalization, companies need to have a more flexible supply chain. The aim of new technologies is not to replace the current system but for a better efficiency. These new kinds of technologies are developed in order to collect data from existing systems, to share and make data visible and meaningful to people who are interested in it. Nowadays the main future technologies are RFID, BPM, BI, SM;

RFID (Radio Frequency Identification) The RFID is a supply chain management tool. Using this technology, you can track pallets, cases and individual items. It is a tag, which contains a microchip and antenna. As the technology is not recent, its cost is attractive for companies. There are two aspects of RFID: The RFID technology (composed of hardware such as RFID tags, Radio frequency scanners and Antennas) and The RFID information (composed of descriptive data about the product itself and tracking data that traces the movement of the product through the supply chain). Therefore, according to these two definitions, we can know that the RFID information is a powerful tool for companies. Benefits of RFID are significant because it can offer a much lower cost way to capture data through the supply chain process. Moreover, the data is more accurate than other systems and gives the company the opportunity to obtain a great level of detail. This system increases the visibility of the inventory; using RFID, it is easier to share data with other parties in the supply chain. However, as the technology was invented a few years ago, companies are not yet mastering it. As a result, they are taking too much time using it in order to track their supply chain activity. Furthermore, the EPC global network is still improving and does not always correspond with the reality of the network.

Figure3: Dr N.Fraser lecture E-commerce and RFID in BLSCM

The Business Process Management (BPM): The BPM is a process based on a sequence of steps that leads the delivery of a specified product or service. Companies can use the BPM in order to carry out a continuous incremental process of their operational performance (Hugos, 2006). The BPM is able to collect and display a continuous stream of data. This can permit to the company to follow each steps of the transaction process. Moreover it can detect certain error conditions in the supply chain during the supply chain.

The Business Intelligence: (BI) The Business intelligence is a guide for the company because BI helps companies to understand what is happening into its own organization and its market. BI systems collects, store and analyze data. Once data are collected by RFID, BPM or ERP, people are using the BI software for displaying the results of the first analysis.

The Simulation Modelling:

It is another category of software used by a large number of companies because it can help companies to make important decisions in their goal of profitability. For example, it is relevant to build a new factory or a new distribution centre? This software can help them to make the appropriate decision in allowing them to create a model of what they would like to build and simulate many different situations. Moreover, this software can be added to software to the precedent technologies. For example, a company which is using BPM software for work processes can use BPM for creating model but after have the necessity to use Simulation Modelling system for simulating the provider of their inputs. By using simulation models, companies are able to test out new business models before they actually commit to them. (Hugos, 2006). Consequently, this system is created for doing right decisions and reduces the risk of the investment because it was firstly tested and analysed.

Differentiated table of Bar code and RFID RFID Wireless YES Bar Code YES

Digital Data

YES

YES

Carry Variable Data

YES

NO

Multi-Label Readable

YES

NO

Security (encryption)

YES

NO

Data Acquisition

FAST

SLOW

Cost

ACCEPTABLE

LOW

Figure 4: Dr N.Fraser lecture E-commerce and RFID in BLSCM

Case Study: The Aqualux Company

The Aqualux Company: Aqualux is an international designer and producer of swimming pools, spa and water treatment equipment. Over the last 10 years, the company has turned into one of the markets leader in the domain of swimming pool quality and variety products. Multi-specialist, Aqualux manufactures and distributes to professionals the first range of products covering all the needs in swimming pool building, periphery and treatment.

(http://www.aqualux.com) The company is localized in the centre of southern France in Saint-Remy de Provence between Marseille and Montpellier. The company is in the heart of the swimming pool market and benefits from the economic supply chain infrastructures forces in this region. History of the company: First, the trademark Aqualux was created in 1987 but the company was really created in 1993 by Liliane and Francis Guillot. The company has been created at the same time as the Single European Union market emerged. There is no denying that the growth of the company was supported by this event. Indeed, since 1993 the Aqualux Company keep increasing its power all around the world. This is why it is interesting to study the case of this company throughout its Business logistics and supply chain network. Nowadays the company has crossed national and European border in order to be recognised in the whole world. For instance, some dates which show the international processes of the company: 2000 : Installation of a chemical products factory.

2001: Set up of an office at Canton, China.

2005 : Grouping of the supply chain on the Aqualux Avignon site - le Pontet; Founding of Aqualux Tunisia (manufacture and assembling of swimming pool equipment); Installation of a new automated machine on the Aqualux in Saint Rmy site - la Massane (13) for the manufacture and testing of automatic covers and barred covers.

2006 : Set up of an office at Algiers, Algeria.

2007 : Set up of the Bordeaux agency. Set up of the Belgium agency. Our vocation is to supply swimming pool professionals with a set of innovative and quality products and services meeting the markets expectations, guaranteeing a durable swimming pool for your pleasure and showcasing your home (Francis Guillot Pdg of the Aqualux company,2001).

Holding T.G.P (Socit mre) Turnover : 45 M (: TGP, Aqualux, TechnicEau)

Aqualux S.A. Turnover: 27 M Staff: 160 - Conception, production, sales of swimmingspools, spas raws. - Customer, installators, distributors, swimming pools. - Services: Enquiries, warranty service, formation

EDG S.A. Turnover : 12M Staff: 30 - Commercialisation and Equipment for wholesailers. - Customers: Retailers

TechnicEau S.A.R.L. Turnover : 6M Staff : 30 - Plombing, heating, watering, air conditioning, professionnel and personal electricity raw materials -

The Logistic and Supply Chain Process of Aqualux : As the company is one of the leaders of the swimming pool market in France and Europe, the company needs to increase its internationalization process. Indeed, as the Swimming pool market is a new market, launched in the 70s which has been developed since 1980s, the company has really been started to grow after 1993 and the creation of the single European Market. Thus, the real take off the company started really in 2001 with the Set up of an office at Canton, China. The new globalisation and the new way of the European market allowed the company a remarkable growth underlined by its logistic and supply chain network all around the world from France to Tunisia, China, Belgium... France: Headquarter of the company and main plant (Saint Remy de Provence): industrial technical pole (Planning, flow inventory, manufacture, Research and development and buying process) Logistic warehouse (Avignon-Le Pontet): Stock inventory, command planning, raw material receptions and consignment. Tunisia: Manufacturing, Research, and development plant for Spas, outlet boxes and swimming pools devices. China and USA: Raw material and accessories trade. 2009: New plant in India. Moreover, the company has contract-out for its production all around the globe with Japanese and European countries in addition to these countries mentioned above. Indeed, all the countries, which are trading with the company, are contract-out companies except France and Tunisia. The Shipping Process: According to Mr. Guillot, export has always been a priority for the company. The company is exporting into 80 countries with a turnover of 8.5 millions. In order to do these exports the company uses the maritime transport for its main shipping and by trucks on a national and European scale. The cost of this kind of transport is much lower than planes or trains. Therefore, the Containers is the best shipping way for transporting a massive volume of its products without emitting a lot of

carbon dioxide. Moreover, a fast delivery service to its production units is not to be expected, because most of their commands are prepared 3 months ago. The Chinese subsidiary is controlling all the shipping process of its trade. The containerization process: This process is defined by a shipping of freight in a larger rectangular box, or container subsequently transferred from one carrier to another without handling the commodities each time. The carrier handles the container, not the commodities. As the company has two main plants located in France and in Tunisia, the Containerization process is doing from the South of France and from Tunisia across the entire World. Benefits of the Containerization: Reducing commodity handling cost Ability to reduce damage costs. Avoid theft and pilferage. Reduce time required to complete the modal transfer.

In addition to the Containerization, the company uses road transport: Two regular flows a day are operated between the Warehouse and stores. This fosters the faster delivery system of the company and explains why Aqualux is one of the leaders in the European swimming pool market. As a conclusion, the export provides 50% of the companys turnover. Therefore, in order to understand the development of the company, we need to analyse how the Logistic and Supply chain developed particularly before and after 1993.

Aqualux and logistic and supply chain Theories

The Aqualux Value Chain: Firm Infrastructure: Headquarter and two main offices in France, one in Belgium and then plants in Tunisia and China. Human resource Management: Special training is provided for its employees in several supply chain meetings. These meetings are arranged in order to increase the efficiency of the logistics and to understand how companies can develop more effectively their supply chain processes. The last meeting was in Lyon with many companies involved and concerned by this process. The firm pays attention to its employees feedback.

Technology Management: Project, MRP, ERP and Just-in-Time. Software: Adonix-ERP Customer and state research (Public construction in Marocco, Russia...) RFID.

Procurement: Containers and Road transport way. Specific procurement department in china checking all containers, Significant of supplier and customer feedback. Outsourcing

Supply chain management: Inbound logistic (French Warehouse, Tunisian inputs plant, contract-out which relocate a significant part of its input production to European companies) Operations Outbound (containers, trucks and third distributors.) Marketing and sales (advertising, promotions and pricing policy, strong product information and website)

Product uses: Important Customer Service for return logistic in order to know if the product needs to be returned to the production process or if it could be fixed in the customer department. As we could see in the Value Chain, ERP, Just in time and Kanban methods are important for the efficiency of the Company. In addition to this, the E-commerce technique is an important tool of the company that gives to Aqualux an important reduction of cost by using e-mail inside and outside the company. Another aspect is the opportunity of this service to offer online product in order to improve the revenue of the company with reaching far-out customers.

The Aqualux Just-In Time and Kanban method: As, the company is driven by a pull system, it uses just-in time and Kanban. It allows to Aqualux to respond quickly to the demand forecasted. Indeed, in France, the company produces specific swimming pool on customer demand. To produce this kind of product, the company uses Kanban and Just in time methods. Moreover the Kanban method helps the company to avoid a stock burst and permit to be adapted from an irregular consumption.

Time Figure 5: Aqualux Company. ee Thus, the company uses this theory when it is necessary according to the product availability and the fluctuation of factory prices. Kanban provides a better materials flow through the supply chain process as it supports the pull control process within the company. The company is mainly ruled by MRP. Hence for the swimming pool market it is important to have a strong system for forecasting or projecting component parts and materials requirement. As mentioned above, the MRP plans out: Type of swimming pool material manufactured internally. Type of input and their quantity of purchasing At what time to place the order for the customer supply. The use of MRP is important to avoid waste of time and resources. Moreover it allows the company to connect all its activities around the world. Therefore, in order to compile MRP data which comes from commercial previsions, the company requires to valuable ERP software: ERP sage Adonix x3.

The ERP system of Aqualux

Export data

Application Access

Oracle Data base

ERP Adonix Copy in the access data base

Application Access

Import data Sales planning by the comercial department by E-Mail Application Access

Figure6: Aqualux Company. Finally, In order to maintain among the European leaders in the swimming pool sector, Aqualux shift its strategy from a wholesaler to a swimming pool designer /Producer. It is mainly due to this change that the company is leading nowadays the French market and sooner the European. Aqualux and Porters generic: According to Porters generic the company is in a leadership position mainly due to the diversity of its product such as its production of: Spas (Jacuzzi), hammams, saunas, chemical products, swimming pools, liners, cleaner equipment. This generates Aqualux a significant competitive advantage to the firm as the Appendix 2 put into relevance the projects built by the company all around the world. These projects slant the company not in a leadership cost but in a differentiation position giving to the firm a significant competitive advantage.

The Implication of the SEM for Aqualux: Before 1993, the internationalisation of the company and its Logistic and Supply Chain network was not existent. At this time, all activities of the company were based in France in Saint-Rmy de Provence. This is where headquarters has been settled. The main company was Techniceau

specialised in plumbing. For this company, before 1993, its internationalisation was not really an opportunity due to The start of the swimming pool growth A market too rigid Trade barrier in Europe and in the world were reluctant for exporting items.

Thus, the company started really its activities in 1993 at the same time of the swimming pool market take off and the creation of the Single European Market. These two factors allowed the company an exponential growth. Thanks to the liberalisation of services and capitals in the SEM, the Aqualux Company started quickly to contract-out a significant part of its production and shipment process from European companies. The SEM has allowed the company to develop efficiently its logistic network due to the deregulation of international haulage and the possibility for companies to get free freight for its shipping process. These two factors explain essentially how the company has been developed since 1992 and the SEM. The SEM, allowed the company to insert progressively into a global activity to become a global company with market-shares all around the world. Vernons life cycle highlights the internationalisation of the company. Indeed, the company started to create its product in France. Then with the SEM and globalisation, the company exports its product in countries structurally closes such as European countries. Then, the product has been diffused in the 21st century all around the globe. Therefore, this diffusion was a significant turn because company in developing countries started to create products similar and cheaper than Aqualux. This is why the company is not only producing all items (Figure7). Referring to the third step of the Vernons lifecycle the company imports nowadays from its contract-out companies some inputs and other products in order to be more competitive in the research and development process based on the innovation process eg.: Schumpeter and the innovation cycle. Mainly due to the removal of barriers in Europe, Aqualux was able to reduce its costs in R&D and to expand their European branding. The main contract-out countries of the Company:

AT AU BE CA CH CN DK ES FI FR GB GR HK IL IN IT LU NL PL RU TN TW US

Countries Austria Australie Belgium Canada Switzerland China Denmark Spain Finlande France Great Britain Greece Hong kong Israel India Italy Luxembourg Netherlands Poland Russia Tunisia Tawain USA

Figure 7: Source: Aqualux Company To conclude this part, we can see that the SEM allowed to the company to develop its network inside and outside the European Union.

SWOT Analysis of the company:

Strength Leader in the swimming Pool Market. Quickly internationalised European and World Manufacturing Plant Research and Development process ERP and MRP System Just-in time and Kanban

Weaknesses Begining of the supply chain process. Only two ways of transport. European green Policy

Opportunities SEM and contract-out. Future project in the Russia and Dubai. Creation of an Indian Manufacture. E-Business E-Commerce.

Threat Competition Decrease of the Swimming pool Market.

Figure 8: No sources

The Aqualux Supply chain Process and its future evolutions:

The Supply Chain Process of Aqualux:

Demand Planning

Figure 9: Source Aqualux Company For the Moment, as the company is at the beginning of the supply chain, its main aim is to link these three activities (Figure5) in order to reach an optimal efficiency in its production schedule planning. Some aspect of the Future of logistics and supply chain mentioned above are already integrated into the Company. Indeed, the company is already involved into a Pull system with the Kanban and JustIn-Time Theory. The relational service takes a significant part for its reverse logistic. In addition to this, the Aqualux Company plans to integrate within its activity the RFID Technique. This technique is

one of the keypoint elements for the future item traceability in the logistic and supply chain process. Indeed, the RFID is view by the company as a powerful technology to increase the efficiency and the effectiveness of the Aqualux logistic and supply chain activity. As a. Hugos (2006), the RFID allows to the company to gain time and capacity for the transport of its items. Moreover, it also less inconvenient to check each item rather than bar code because you can verify the item even if you have an obstacle behind the RFID and the product in addition to definition mentioned above. Therefore, the company is constantly reaching the best for its development and as Mr.Baudin (2009) says, the RFID on a long term will be the future of our bar code for the opportunities mentioned above. In addition to this the company will improve soon the B.I technical in order to complement ERP sage adonix x3. Indeed, for Aqualux this kind of software is necessary for an optimal effectiveness of its ERP system. So, the RFID and B.I are the next two steps of the Aqualux company in the future in order to link ADV, flows management and logistic together for developing its supply chain as an entire activity. Finally, as Aqualux is a swimming pool company, the Environment policy is taken into account every day and overall in the Future.

Figure 10: Source Dr Nuran Fraser Lecture slides 2009

Customer code

ERP Adonix recording

ADV
Delay (48H)

Supplying Delay

CBN

Flows management

Buying suggestion and creation

Buyng order

Fabrication

Logistique

logistic preparation

Customer delivery

Figure 11 : Source Aqualux company. The green policy objectives of the company are: Basically, the company has to be faced with these three parameters for its future logistic and supply chain activity. Mr. Baudin says, As a sustainable logistic is costly and needs to take into account the Economy, the Society and the Environment factors, the aim of the company is to integrate little by little the sustainable kind of thinking in our society if we want to invest and protect our environment. Although, the company is involved into this process with a green packaging service, the R&D service search sustainable product. One of the future challenges is to integrate a Green and sustainable supply chain. Concerning the supply chain, an evolution of our plant has been done since its creation in order to integrate all the time new and environmental technologies. Concerning its logistic process, the company is studying a greener way of transport in reducing truck gas emission and implement the rail-road. Potential return on investment could be gained. Finally the air transport, its always too costly for the company and it is not a solution studied for the future sustainable environment. On a further research, the company should focus on a rail transport development. This kind of transport is more sustainable in comparison of its trucks transportation system.

Impact on the sustainability for companies.

Figure 12: Source: http://www.greenlogistics.org/PageView.aspx?id=97

Conclusion:

As mentioned above, the single European Market has been a significant step for the integration of Logistics and supply chain of European companies. This Unification gave a lot of opportunities for companies. Indeed, due to the SEM, companies can develop a global supply chain in proceeding to contract-out services and relocations. This allows to firms an increase of their efficiency. Indeed, the firm can gain competitive advantage form its logistic and Supply chain process. Due to the new impact of these policies, firm are more able to deliver the right product at the right place, right now. The case in point of the Aqualux Company highlights how the Single European Market gave to the company a significant growth only in 15 years. Since the SEM and the new liberal globalisation, the company has been able to take benefits from these two factors in order to lead the Swimming pool Market and in Europe. Thus SEM and the Globalisation slanted companies toward a significant change. Nowadays, a new challenge has to be drawn and deals with the future of the Supply chain. How companies can increase their trade all around the world in implementing new technologies such as RFID or Business Intelligence while taking into account the environmental sustainability

Appendix1: Questionnaire: Interview with B.Baudin logistic and supply chain director of the company. What is basically the supply chain of the company? Well, as the company is young and started its international growth around 10 years ago, we are just at the beginning of the Entire supply chain process but we definitely are involving into this way. Nowadays, the logistic and supply chain of the company is divided into three areas: ADV, flows management and logistic department. So, can you tell me what the production process of the company is? Basically, we are headquartered in St-Remy as well as the main industrial pole for the research and development process. Then, our Main European warehouse is in Avignon-Le Pontet for and the Production plants are in Tunisia and China. Moreover, our specificity is that the checking department is settled in China for all of our products. In addition to this, the company has a lot of contract-out in Europe overall for our input such as: Scandinavian countries for the wood items. Well in order to understand how is the logistic service of the company, how is your shipping process? First of all, our main ways of transport are the maritime and the road ways. Indeed, the containerization is the best value for cost per volume for our globalised trade. Then, we use trucks from the maritime way to the customer delivery because it is a low cost way allowing flexibility. Furthermore, in order to avoid the length of this kind of transport, we are doing two rounds between the warehouse and our stores per day. Even if the company was created in 1987, what are the implications from the SEM for the logistic and supply chain of the Aqualux company? It is easily to understand that the SEM was a significant turn for the internationalisation and the growth of the company. Indeed since the SEM, the company has not kept to be increased. This is mainly due to the deregulation of the market and the free movement of goods and capitals in Europe. For our company, this allowed us to have beneficial contract-out with a certain amount of European and International companies as I mentioned above. Moreover, the European policy fostered significant change in our Logistic and supply chain network as for example, gas emission restriction or fuel restrictions.

How is the reverse logistic process of the company? Our reverse logistic is principally based on the customer relationships with our after sale service. Indeed, an important feedback is done in order to understand in what consist the product failure and if we can fix on the spot or if we need to send it to Tunisia or China. Finally, Can you tell me how are the future expansion of the company in terms of the logistic and supply chain process? (Manufactures, new trends on the logistic way and the green policy of the company) For this year, we plan to open a new manufacturing plant in India in order to develop more our brand in this region. In addition to this, since many times we are looking how in the future could be more efficient the RFID and the Business intelligence. Indeed these two techniques permit to reduce the waste and save money on a long term vision. Concerning the green policy of the company, as a sustainable logistic is costly and needs to takes into account the Economy, the Society and the Environment factors, the aim of the company is to integrate little by little the sustainable kind of thinking in our society if we want to invest and protect our environment. Therefore, we actually not involved into a green policy because we are at the beginning of an entire supply chain. However, there is no denying that in the future, once the supply chain has been integrated, we will develop the green and sustainable supply chain. For the Moment, European restrictions have only a significant impact into our logistic and European contract-out plants.

Appendix2: Aqualux: An international designer and manufacturer for swimming pool, spas and water equipment.

Aqualux Identity

The AQUALUX group is at the moment one of the leaders on the European swimming-pool equipment market in terms of quality and diversity of its product range. Missions

Commitment to quality : Our vocation is to sell innovative and quality products and services to our customers in accordance with the expectations of the market, in order to facilitate their own performance. We are very concerned by our customers and the final consumers satisfaction. That is the reason why we do focus on designing and marketing reliable equipments and products.

Long-term partnership : We wish to establish long-lasting partnership with our customers, founded on the respect of our commitments, and a continuous listening and sense of service. In order to achieve all these goals, our power is first and foremost human and relies on the ability and the devotion of all the companys employees.

Aqualux Presentation

Located in the South of France, AQUALUX designs, manufactures, and distributes a very wide and competitive range of equipments for both private and public swimming-pools in the whole world. Aqualux is committed in the design and the manufacturing of these products.
2

The company is set up on a 70 000 m land divided on 7 different sites. There are about 240 employees working for the group. The group has had annual advances since its creation. In 2006 the turnover has reached 55 million Euros.

Aqualux The Research and Development Department

The Research & Development Department designs and elaborates products .The team, composed of 9 engineers and designers, takes information from the different marketing studies and products consumption behaviours. Creation and evolution of the products rely on a permanent analysis of the customers needs and expectations, together with a strong will to innovate. Thus, most of the products of the group bear the Aqualux stamp. With the largest product range on the market,AQUALUX aims at meeting all of its customers needs, with an added value, which is INNOVATION and DESIGN. It may be the reason why we won the DESIGN TROPHY in 2002 for our new pool accessories.

Aqualux Industry

The group has set up a real industrial policy for a few years. Aqualux manufactures most of the products of the catalogue on its own industrial sites (chemicals, electricity, liners, covers, etc.) or sub-contracts (filters, pumps, white goods, etc.). The group spreads a strong Quality policy to all its partners. AQUALUX has open a factory in Tunisia in 2005 (Aqualux Tunisia)

Aqualux The Customer Service

On a very price orientated market,AQUALUX aims at differing from its competitors with SERVICES. The After-Sales Department : In 2006, this department has achieved more than 3000 repairs from all brand names and has given phone advice and directed on-site operations. The Spare Parts Department :This department enjoys an excellent reputation throughout Europe, having the largest stock of spare parts from all brand names on the swimming-pool market. It is an important asset for all our customers. Training : Aqualux organises each year more than 15 training sessions in order to train the swimming-pool professionals to the new techniques and products. Each year, 500 professionals improve their knowledge with us.

Aqualux

The EngineeringDepartment

The AQUALUX Engineering Department elaborates all the hydraulic, electric, heating and chemical studies for any kind of public and private swimming-pools, or water parks. More than 1 500 quotations and studies are made each year for private and public swimming-pools in the whole world. The engineers intervene to help for difficult installation operations with the Technical Assistance Department.

Aqualux International Marketing

Multi-specialist for swimming-pool equipment, AQUALUX markets its products overseas via several distribution circuits : Traditional swimming-pool professionals Traders in sanitary / heating and construction materials Distributors AQUALUX has a dedicated Export Catalogue in English. AQUALUX is present overseas in around 80 countries.

Aqualux The Export Department

Export has always been a priority for the company. From Greece to Mali,from the West Indies to Japan,Aqualux exports towards 80 countries with a turnover of 5,2 million Euros. The Aqualux Export Department won the Export Growth Trophy in 2002.The company has been selected among different companies from the South of France for its exceptional turnover increase. The efforts of a company eager to develop overseas were crowned with success.

A few AQUALUX public realizations abroad :

Aqualux

Recent AQUALUX publicrealizations abroad :

UNITED ARAB EMIRATES (2006) A 450m x 14m canal in Dubai Festival City resort, Dubai, UAE.This canal will be equipped with Aqualux white goods, filters and pumps including 18 Provence 4 bar bobbin wound filters 1600 and 18 Pulsar cast iron pumps 5,5 HP. RUSSIA (2006) The Saint Petersbourg Aquapark, a water park that will include several pools working with Aqualux material. 2 Provence bobbin wound filters 2000, 1 Provence bobbin wound filter 1050, 5 Luberon fibreglass filters 750, 3 Pulsar cast iron pumps 7,5 HP et 3 x 4 HP, 5 Neo pumps 2 HP, 6 regulation panels pH / Redox, 1 regulation panel pH / free chlorine and 12 Suny UV sterilizers. EQUATORIAL GUINEA (2006 on going) Villa Asonga swimming pool, one of the presidential residences. Filtration is incuding 3 Calplas laminated fibreglass filters 900, 3 Firsty pumps 3 HP and one automatic treatment system. ALGERIA (2005) Swimming pool of the General Military Hospital in Oran, Algeria, which is one of the most modern hospitals in Algeria. Olympic size swimming pools equipped with 4 Provence bobbin wound filters 1600 and 7,5 HP Pulsar cast iron pumps. MAURITIUS (2005 and 2004) Marechal Hotel swimming pool in Rodrigues featuring 6 Provence bobbin wound filters 2000 and 25 HP Pulsar cast iron pumps (2004). Mare dAlbert Residence swimming pool featuring 2 Provence bobbin wound filters 2000 and 7,5 HP Pulsar cast iron pumps. KAZAKHSTAN (2004) The Almaty Water Park featuring a 120m3 apple shape swimming pool for the use of children and another 700m3 pool.The filtration includes 3 Provence bobbin wound filters 2000 and 3 Pulsar cast iron pumps 10 HP. BURKINA FASO (2004) Al Fateh Hotel swimming pool in Ouagadougou, Burkina Faso, a 35x18m i.e. 630m2 pool. Al Fateh is one of the most prestigious hotels in the country. Filtration system includes Aqualux Calplas laminated fibreglass filter and Etabloc pumps.

ZA de la Gare - BP 135 - 13533 Saint Rmy de Provence cedex - FRANCE Tl : + 33 4 90 92 75 00 - Fax : + 33 4 90 92 43 99 - info@aqualux.com S.A.S au capital de 1 274 272 euros - RCS TARASCON www.aqualux.com B 390 039 949

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nd

edition), London:Routledge.

Taylor,D.(1997) Global cases in logistics and supply chain management, London: International Thompson Business Press. [Accesed on the 4 of January] : http://www.Aqualux.com [Accesed on the 20th of February] http://www.emeraldinsight.com

[Accesed on the 4 of March] :

http://www.greenlogistics.org/PageView.aspx?id=97 http : //www.logistics-in Europe.com