Xylan Corp. is a small company on the verge of becoming big. For Catherine McCallum, traffic manager of worldwide logistics, that has meant forging a supply chain that can handle rapid growth in an industry with near-unlimited potential.
Tucked away in Calabasas, just over the mountains north of Los Angeles, Xylan makes network switching equipment that allows for the digital transfer of data, voice and video. Major customers include phone companies, cable companies and banks.
Xylan faces stiff competition from rivals such as Cisco Systems and 3Com Corp., but it's growing fast. Founded in 1993, it has seen revenue climb from $30m to last year's total of $350m. This year, the company expects to do between $600m and $700m worth of business, McCallum said. Even so, that pales in comparison with the overall size of the worldwide switching market, estimated at $5.7bn.
In coping with its dizzying rate of growth, Xylan faced the dual challenge of selecting a third-party logistics (3PL) provider to help manage its expanding global supply chain, and a software package that could automate key functions and documentation in its export program. McCallum turned to Danzas Corp. for the first need, and Syntra Ltd. for the second.
Danzas, a Basel, Switzerland-based forwarder that has recently branched into third-party logistics in the U.S. and elsewhere, had to prove itself to Xylan before getting a substantial piece of the business. Early last year, McCallum found herself needing to move product between the San Francisco Bay Area and Los Angeles on a daily basis. Pickups had to be late at night to allow for early-morning delivery.
Primarily an international forwarder, Danzas jumped at the chance to handle an ostensibly small piece of domestic over-the-road business. For Xylan, it designed a dedicated truck service that could make the run in eight hours. It began by shipping between two and three pallets a day, but volumes soon increased. So did the variety of business that Xylan was willing to hand over to Danzas.
In May of 1998, Xylan appointed Danzas its exclusive handler of heavyweight domestic and international shipments. Services under the new arrangement included warehousing, trucking, air export, customs brokerage, and pick-and-pack activities. Xylan's other freight-forwarding partner is Federal Express Corp., which handles small packages.
|An effective software package "has to offer a program that's going to do all my logistics needs today... and come up with input as to what I can't visualize."|
- Catherine McCallum of Xylan Corp.
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