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AGCO Smart Logistics Closes Digital Gap

Receives European Gold Medal in Logistics and Supply Chain

AGCO’s Smart Logistics initiative received the ‘European Gold Medal in Logistics and Supply Chain’ from The European Logistics Association (ELA) in Brussels. AGCO and 4flow were recognized for their efforts in digitalization and end-to-end integration of partners within AGCO’s international inbound supply chain. Late last year, AGCO and 4flow also won the renowned German Supply Chain Management award by the German BVL organization for their Smart Logistics initiative.

The ELA, a federation of 30 national organizations from across Europe, awards the most innovative logistics and supply chain transformation projects each year. The contest, which is often described as the Champions League of Logistics and Supply Chain Management, is played out amongst 30 award-winning projects from national competitions The ELA jury selected the AGCO and 4flow initiative as the best this year. The agricultural equipment company along with its fourth-party logistics service provider (4PL) were able to win the competition amongst incumbents to various industrial sectors.  This award underlines AGCO’s chosen path to not only provide market-leading products, but to support these products with the best and most innovative processes. It also shows that joint forces are key in making a difference in today's marketplace. The AGCO and 4flow supply chain team is incredibly proud of being recognized with the ELA award. The integration of the European supply network with the 4PL concept was a recognized achievement by the AGCO team and its partner 4flow. The AGCO Smart Logistics initiative consists of innovative and collaborative processes building on an integrated Supply Chain Management IT solution and by joining forces with 4flow as its neutral 4PL partner. A dedicated team at 4flow supports AGCO with continuous planning, management, and optimization of the inbound networks in Europe.

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The collaboration by AGCO and 4flow includes strategic network planning and inbound optimization as well as cost monitoring and reporting. The approach is based upon the principle of combining an intelligent transportation management system, a standardized supplier development process, and risk management into a central cloud-based IT solution. The innovative approach utilizes smart algorithms that dynamically optimize the network requirements holistically, including capacities, supplier shipping requirements, lead-times, as well as monitoring a wide range of geopolitical, weather, and economic factors on a real-time basis in order to optimize the material flow. Defined as one of the strategic corner stones in its Supply Chain Strategy the three essential drivers of innovation for AGCO were based in its heritage of bringing the best of different brands together. Key drivers are:

1. The integration of the company’s production and aftermarket sites while continuing to maintain its multi-brand strategies.

2. The implementation of a globally standardized and integrated freight network delivering a sustainable performance level of excellence while providing the agility and adaptability to support global product development, manufacturing, and aftermarket requirements in a digitized environment.

3. The ability to proactively detect and mitigate potential risk factors occurring within the company’s global supply network The innovative collaborative approach of inbound supply chain planning and control was rolled out in 20 manufacturing and aftermarket sites worldwide. AGCO worked closely with its partner and 4PL service provider 4flow. Together, the partners integrated more than 1,500 material suppliers and more than 70 logistics service providers as part of this initiative.

This level of integration enables an unprecedented dynamic planning of the inbound network in order to optimize costs and risks on a daily basis. By using its AGCO Smart Logistics solution the company has increased the synergies as well as reduced global supply chain risk. With this, AGCO enabled the change towards a highly integrated value added network, which not ends at the factory gates but extends towards its supply chain partners. For AGCO, big data becomes a driver for adding value. The solution enabled AGCO to reduce cost of the inbound supply chain by more than 25 percent during the past years. Furthermore, on time delivery performance increased by 10 percent while process conformance has increased by 15 percent. Paired with significant improvements in Supply Chain agility, the company generates a competitive advantage in the marketplace. In addition to the significant improvements in costs, performance and quality, the initiative is reducing the CO2 footprint through improved capacity utilization and therefore it not only benefits AGCO but the environment as well.

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About AGCO

AGCO (NYSE: AGCO) is a global leader in the design, manufacture and distribution of agricultural solutions and supports more productive farming through its full line of equipment and related services. AGCO products are sold through five core brands, Challenger®, Fendt®, GSI®, Massey Ferguson® and Valtra®, supported by Fuse® precision technologies and farm optimization services, and are distributed globally through a combination of over 3,000 independent dealers and distributors in more than 150 countries. Founded in 1990, AGCO is headquartered in Duluth, GA, USA. In 2016, AGCO had net sales of $7.4 billion. For more information, visit http://www.AGCOcorp.com. For company news, information and events, please follow us on Twitter: @AGCOCorp. For financial news on Twitter, please follow the hashtag #AGCOIR.

About 4flow

4flow provides consulting, software and services for logistics and supply chain management. 4flow consulting offers one-stop management consulting, concept development, and implementation support for logistics and supply chain management. 4flow vista® is the standard software for supply chain and transportation optimization. As a neutral 4PL, 4flow management handles the continuous planning, optimization, and operation of customers’ supply chain networks. 4flow research develops practical innovations and conducts supply chain research relevant to the industry. 4flow is a recipient of the German Award for Supply Chain Management 2016. For more information, please visit www.4flow.com.

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