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John Deere’s Global Parts Distribution Network Strategy

John Deere’s Global Parts Distribution Network Strategy

It all started with an innovative answer to a farmer’s complaint which led to a blacksmith’s revolutionary invention of the farmer’s plow in 1837.  That blacksmith was John Deere and soon he was turning out hayforks, horseshoes, and other essentials for life on the prairie. 

Fast forward to the current day and the John Deere Company continues to design and manufacture advanced equipment for those who work the land.  John Deere (NYSE: DE) is a publicly traded company with annual worldwide sales in 2011 of $US 29.5 Billion (note that parts make up 15% of revenues).  The company is headquartered in Moline, IL where John Deere relocated in 1848 in order to have access to the railroad and the Mississippi River.

John Deere provides its customers with the highest levels of customer support for aftermarket sales through an international parts distribution network that is intelligently designed to provide high speed order turnaround time balanced against the need to minimize logistics operating expenses and inventory assets.  This is a particularly difficult challenge for any company that supplies a global dealer network with upwards of 800,000 parts. Within the North American parts network, John Deere dealers have access to the complete catalog of unique stock parts, which support all product lines, including agriculture, turf, construction and forestry products. For John Deere, the goal is to service most of these parts to dealer locations within 48 hours and to maintain a 99% order fill rate.

John Deere has done an excellent job of figuring out how to optimize its logistics strategy through what we call a rear / forward inventory deployment strategy. In simplistic terms, this stocking strategy calls for the centralized distribution of the vast variety of parts that are slow moving and obsolete SKUs; and the regional distribution of parts that are fast velocity.  This strategy ensures that the SKUs that account for the majority of sales revenue are closest to key market demand points to minimize order turnaround time which is an important competitive advantage.  In other words, if 80+% of the sales revenue is derived from a small subset of SKUs then position these SKUs closest to their demand points so that customers can be serviced as quickly as possible.  For the balance of slow moving parts, centralize the inventory in one distribution center to minimize inventory assets and space requirements. Of course there are nuances on this theme whereby slow moving parts that are expensive to transport may be stocked regionally; or very high value parts with medium velocity may be stocked centrally;  but the rear / forward deployment strategy is highly suited to the parts distribution industry.

John Deere Parts Distribution Network in North America

John Deere’s parts distribution centers in North America exceed 4.6 Million square feet of space and are listed below.  All figures provided are approximate estimates.








Description of Operation

North American Parts Distribution Center

1600 1st Ave E

Milan, IL, USA, 61264

United States of America



  • Centralized full-line distribution center stocking slower moving and obsolete parts to support depots, independent dealers, and customers around the world.
  • Services customers in the mid-west of the U.S. as well as export markets
  • Facility was most recently expanded by 381,920 sq ft @ 32' in 2009. Original building is approx. 22’ clear height. A large yard is also used to store inventory.
  • 12 AS/RS machines operate in the original building.
  • Ships 80,000 order lines/day or 450,000 lines/week.
  • Over 500,000 parts in stock, Slotting tool is from Optricity
  • Facility operates 24x7
  • Approximately 550 warehouse associates (UAW)

Regional Parts Depot

10650 Harry Hines Blvd.,

Dallas, TX, USA< 75220-2635

United States of America


March, 1999


Regional Parts Depot

6101 Stapleton Drive North, Denver, CO, USA,80216-3338

United States of America




Regional Parts Distribution Center

2100 NE 181st Avenue, Portland, OR, USA, 97230-6994

United States of America



  • Applied in June, 2011 to expand DC by 22,000 sq ft

Regional Parts Distribution Center

1740 Shideler Parkway, Lathrop, CA, USA, 95330

United States of America



  • Relocated in 2009 from Stockton, CA

Regional Parts Distribution Center

180 Westridge Parkway, McDonough, GA, 30253

United States of America


March, 2010

  • Services customers in the SouthEast
  • Replaced the DC in Conyers, GA in March, 2010

Regional Parts Distribution Center

9832 12TH Avenue S.W. Bldg. 3, Edmonton, AB, Canada, T6X 0J5



June, 2011

  • Serves 92 John Deere dealer locations in Alberta and British Columbia 
  • Contains ~ 90,000 different, unique aftermarket parts
  • 32 warehouse associates

Regional Parts Distribution Center

455 Park Street, Regina, SK, Canada, S4N 5B2




  • Serves customers in Western Canada including the area in Ontario west of The Great Lakes.

Regional Parts Distribution Center

South Service Road at Hunter, P.O. Box 1000




  • 130,000 Parts in stock.
  • Facility last expanded by 96,000 sq ft in Oct, 2011
  • Services 479 American dealerships & 191 Canadian dealerships
  • 115 warehouse associates
  • Facility absorbed a smaller Syracuse, NY warehouse which was closed in March, 2010

Regional Parts Distribution Center

Boulevard Diaz Ordaz No. 500,Garza Garcia, Nuevo Leon, Mexico, 66210





John Deere's North America Distribution Network

John Deere Parts Distribution Network Outside of North America

The John Deere parts distribution center network outside of North America exceeds 3.1 Million square feet of space and all distribution centers are listed below.  All figures provided are approximate estimates.








Description of Operation

European Parts Parts Distribution Center (EPDC)

John Deere Strasse 2, Bruchsal, Germany, D 76646




  • 200,000 parts centrally distributed to sales partners in Europe, the Middle East, and Africa from a 667,400 sq. ft. EPDC
  • Facility was last expanded by 172,200 sq. ft. in November, 2011 with the addition of a new parts deconsolidation and packaging facility (DECON) to streamline and facilitate the flow of incoming parts from John Deere factories and outside suppliers.

Regional Parts Depot

Harby Road, Langar, Nottingham

Nottinghamshire England, NG13 9HT




Regional Parts Distribution Center

Fyrgatan 8-14, Box 503

S-195 25, Marsta, Sweden



November, 2011

  • Facility is north of Stockholm and serves the Scandinavian and Baltic markets.

EurAsian Parts Distribution Center

Domodedovo Branch of John Deere Rus, LLC

Building 2, Estate Sklady 104, Belye Stolby Microdistrict,Domodedovo,142050 Russia



April, 2010

  • Manufacturing / assembly plant for large tractors, combine harvesters, backhoe loaders, wheel loaders, timber harvesters in a 215,000 sq. ft. area.
  • A  290,600 sq. ft. parts distribution facility supplies customers direct in Russia and surrounding markets.

South American Parts Distribution Center

Rua SÚrgio Fernandes Borges Soares, 1000

Distrito Industrial

13054-709 Campinas, Sao Paulo, Brazil



March, 2009

  • 3PL-operated by CEVA Logistics
  • Over 60,000 parts serviced to John Deere dealerships throughout South America.
  • Poor modal connectivity between inland points and Brazil's productive port complexes led to this facility being positioned close to the coast and the country's more developed transportation links
  • Facility expanded by 400,000 SF in Sep., 2013

Regional Parts Distribution Depot

J. Orsetti 481,

Granadero Baigorria, 2152, Rosario, Santa Fe, Argentina





Australian and New Zealand Distribution Centre (ANZDC)

John Deere Court — Parkwest Estate

Derrimut, Victoria, 3030, Australia




  • 75,000 parts serviced to John Deere dealerships throughout South America.
  • Ship ~3,000 order lines daily
  • Last expanded in 2005

Regional Parts Depot (Brisbane)

166-170 Magnesium Drive, Crestmead, Queensland, 4132, Australia





Regional Parts Distribution Depot

260 Main Rd, State Highway 1, Tokoroa Waikato, 2392, New Zealand

New Zealand



  • Manufacturing plant for forestry harvesting equipment & regional parts depot for New Zealand and Pacific Islands.

Regional Parts Distribution Depot

Pune, India




  • The parts distribution center is adjacent to a manufacturing facility at Sanaswadi-Pune
  • Services parts to 400 dealers across India

Regional Parts Distribution Depot

Plumbago Business Park, Blaauwklippen Avenue, Glen Marais Ext
Kempton Park, Gauteng, South Africa

South Africa


Oct. 2012

  • John Deere launched a new parts distribution center close to Tambo International Airport outside Johannesburg.   The facility has three times more space than its predecessor in Rosslyn.

China National Parts Distribution Center

278 Hong Qi Road,Tianjin, 300190



February, 2010

  • 3PL-Operated by Kuehne + Nagel
  • Facility services parts made in 3 John Deere plants in China to the national Chinese market.
John Deere Global Parts Distribution Network

Discussion on Global Parts Distribution Network Strategy

John Deere’s rear / forward deployment strategy is a critically important concept that is required to support the company's global distribution network of 800,000 parts.  Fast moving SKUS are duplicated in multiple distribution centers positioned closest to the customer demand points. Slow and obsolete parts are centrally stocked in Milan, IL and in Bruchsal, Germany (See Green facilities above).  The company’s stocking locations and inventories are managed by a centralized computer system (SAP) such that every night the computer can map customer orders to the most logical distribution center for rapid and complete fulfillment..

If one had to generalize, the rear / forward deployment strategy works best in markets characterized by:

  1. High revenue opportunity
  2. A large geographical footprint therefore a high transportation expense
  3. High levels of competition where speed to market is a critical competitive advantage

With this in mind, it makes perfect sense for parts distribution companies servicing large national markets to establish a rear / forward deployment strategy to ensure that the highest levels of customer service are achieved and to ensure that this objective is balanced against minimizing logistics operating expenses and inventory assets.  This strategy may not necessarily be applicable to all global markets for several reasons:

  • In Western Europe the smaller geographical footprint combined with the high cost and low availability of land influences the economics of distribution.  For many parts distributors a single centralized distribution center is established to service the entire European continent.  John Deere has gone further by establishing a local presence in England, Sweden and Russia to improve customer support in these regional markets by providing faster order turnaround times.
  • In China, growth opportunities are significant but not without challenges.  For many companies, the solution is to initially establish an arm's length presence by establishing outsourced 3PL distribution centers.  This will be a significant 3PL growth opportunity in the years ahead. 
  • India is an emerging economy that will ultimately require higher levels of support for parts distribution.  Western companies are gradually moving to India but conditions need to become more business-friendly to influence companies to invest in this market.
  • Australia and New Zealand represent a limited market in terms of revenue opportunity spread across a large geographic area hence a regional parts distribution center makes economic sense for this region.  John Deere has followed deployed this strategy and has extended support into New Zealand by operating a local parts depot there.
  • Africa is a massive geographical continent with a large population-base and in theory a rear / forward deployment strategy makes sense for this market.  Many companies establish a beachhead in South Africa because this is a country that is business-friendly and therefore lower in terms of overall supply chain risk management.  Expansion of distribution networks into other parts of Africa remains challenging for many Western companies due to the risk-return proposition.

Marc Wulfraat is the President of MWPVL International Inc.  He can be reached at +(1) (514) 482-3572 Extension 100 or by clicking hereMWPVL International provides supply chain / logistics network strategy consulting services. Our services include: distribution network strategy; distribution center design; material handling and automation design;  supply chain technology consulting; product sourcing; 3PL Outsourcing; and purchasing; transportation consulting; and operational assessments.

Legal disclosure

MWPVL International Inc. does not represent or have a business relationship with John Deere.  This is a research paper for supply chain educational purposes.  The information assembled in this research paper is intended to provide the audience with intelligence on the subject of world class strategies for distribution networks.  In preparing this material, MWPVL International Inc. has not disclosed any private or confidential company information.  MWPVL International Inc. has made every effort to ensure that the information contained within this white paper is as accurate and up to date as possible. However, it is important to note that distribution networks change over time and for this reason there is a possibility that information contained within this paper may be out of date or inaccurate.  If you wish to submit any information to improve the quality of this white paper, please be sure to send us some feedback.

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