BACKGROUND
TomTom is the world’s leading navigation solutions provider with market shares of approximately 50 percent in Europe and 25 percent in the United States.

The company was founded in 1991 in Amsterdam and publicly listed in 2005.  TomTom defined the personal navigation category and has experienced phenomenal growth since its inception. Annual revenue has grown from €8 million in 2002 to €1.7 billion in 2007.  In 2007, annual profit increased by 43 percent to €317 million.  The company has an install base of approximately 20 million units worldwide.

REMARKABLE U.S. GROWTH
After a stellar U.S. launch, the demand for TomTom’s advanced GPS devices quickly expanded.  To meet forecasted consumer demand, they sought a partner that could provide scalable, flexible logistics solutions to manage this surge. 

After an extensive third party logistics (3PL) review process, TomTom selected ATC Logistics & Electronics (ATCLE), for their established capabilities in closed-loop supply chain services and technological expertise.  Once the partnership began, ATCLE expeditiously implemented a new supply chain process to prepare for the critical fourth quarter holiday season.  North American operations were transitioned in phases to ATCLE in the fall of 2006, beginning with same-day fulfillment orders, with volumes rapidly increasing to more than several hundred thousand units during the holiday season.

TEST and REPAIR: THE OVERSEAS CHALLENGE
With hundreds of thousands of devices in the marketplace, TomTom also sought a partner to help manage test and repair of its returned devices to maintain and increase revenue generation.  Prior to ATCLE, TomTom utilized an approach common among many overseas companies: the company shipped a new unit to customers while stockpiling used devices until enough were accumulated to justify the sizable shipment expense to send them back to the European test and repair center.  This caused significant inventory issues, prevented inoperable devices from being repaired and refurbished in a timely manner and was a very costly process.

To alleviate this, TomTom decided to take advantage of ATCLE’s advanced Texas-based test and repair facility, which could more efficiently manage their rapidly growing return volumes.  ATLCE assumed responsibility for all retail and consumer returns as well as device testing and repair.  This allowed TomTom to recoup a significant investment in pre-owned units to capitalize on an important secondary market for high quality refurbished GPS devices.  To ensure quality, ATCLE tests and repairs TomTom’s "road-tested" units for resale in North America, which further increases the company’s domestic market share. ATCLE’s repair and testing services have been so successful that TomTom has plans to integrate them into upcoming expansion into Mexico.

QUICK RESPONSE CAPABILITIES IN NORTH AMERICA
In late 2006, a year after its successful North American launch, TomTom released a significantly upgraded map application that needed to be distributed to more than 150,000 customers.  ATCLE was ready for this sizable challenge and worked closely with TomTom to implement a Web-based solution to facilitate high-velocity forward fulfillment of more than 100,000 upgrades in only a few weeks.

PACKAGING: FLEXIBILITY AND FREIGHT
TomTom’s original equipment manufacturer suppliers are China-based, which presented a myriad of challenges including:

1. Difficulties when there is a need to change or upgrade software
2. Delays in meeting retail requirements for exclusive packaging or special offers

When these changes were necessary, TomTom was forced to unpack, modify, and repack the device, which created inefficiencies and extended lead times to key retailers.

ATCLE offered solutions that would dramatically decrease these costs and streamline TomTom’s supply chain.  Recommendations included the shipment of unpackaged devices via bulk freight to ATCLE’s strategically located facility.  Previously, approximately 200 devices were shipped per pallet.  Upon implementation of a bulk import strategy, TomTom now ships 800 to 900 devices per pallet, resulting in a significant reduction in shipping expense.  ATCLE also assumed responsibility for the procurement of packaging materials and accessory items, further streamlining the supply chain, reducing costs and expediting the delivery of finished goods to the retail channel.  The concentration of value-added services in the "last mile" of the supply chain provides greater flexibility and dramatically improved delivery times allowing TomTom to better meet the needs of their large retail customers.

PROVEN RESULTS
ATCLE’s proven capabilities, flexibility and exceptional operational and technical infrastructure have helped TomTom fulfill business objectives and continue their stellar growth.

Results include:

• Significant reduction of freight expenses
• Tangible profitability improvement attributed to North American supply chain efficiencies
• Improved flexibility to offer promotional concepts that differentiate TomTom from its competitors
• Increased outbound shipments more than ten-fold during peak demand
• Increased repair volumes by a factor of 12 since January. 2007
• Achieved a 99.9 percent quality rating for outbound fulfillment and test & repair since January 2007