Case Study 1
Situation : The company’s transportation network comprised of nearly 75-80 distribution locations based on a series of acquisitions over two decades. Total distribution costs were more than double the applicable benchmarks.
Problem : The company was in a highly competitive industry, barely making economic profits. High distribution cost was seen as a huge burden on the bottom line.
Solution : A thorough analysis of the customer base, and delivery pattern revealed an opportunity to rationalise network to nearly 5 hubs and 35-50 distribution locations. A combination of direct delivery model (for high volume customers, or high value products) and hub-and-spoke model (for rest of the product base) was created with net savings of nearly USD 2.3 Million p.a.
Time : 2 months for analysis and 6 months for implementation.
Case Study 2
Situation : The company, a large retailer, was planning a national distribution centre in order to reduce it total supply chain costs. A variety of locations were under consideration, each with its own benefits – ranging from low land value to central location in the network to government incentives.
Problem : While some of the locational advantages looked great on paper, a pragmatic approach to envisioning a distribution centre operations was needed.
Solution : A thorough analysis of the proposed retail network, freight rates – front haul and back haul, road infrastructure revealed a counter-intuitive location for the national distribution centre. The decision was primarily based on a very high differential between front haul and backhaul freight rates due to freight market equilibrium. All other decision criteria proved to be low leverage points in this supply chain.
Time : 1 months for analysis and 9 months for implementation.
Case Study 3
Situation : The company had outsourced the supply chain task to third parties in a very complex commodity supply chain. There were frequent service failures with associate high costs of rectification. At the same time, due to very high supply chain costs the company was actually losing money in the market.
Problem : The company was grappling with the question whether they could profitably serve the market, or should they exit the market.
Solution : Field observations, data gathering and analysis revealed a wide gap in third party supply chain management. These consisted of sub-optimal mode choice, sub-optimal rates, supply chain planning and scheduling gaps, and low supplier leverage. It was worked out that even with all the potential supply chain improvements, due to competitive dynamics, this particular market would be barely profitable for the company. This information was fed back into overall corporate strategy development to work out an appropriate market response.
Time : 6 weeks for analysis.
Please contact us for more case studies. There is a good chance that we have experience in your industry, or supply chain area which will reduce the time to solution.
