Supply Chain C onsulting Supply Chain and Distribution

Supply Chain C onsulting Supply Chain and Distribution Integration Global Pizza Retailer, Manufacturer & Distributor Designing the optimal network strategy for current and future operations to reduce cost and complexity, improve service and accommodate rapid growth Client Objectives The Client, a global pizza chain was considering various scenarios across its business, including: (1) whether or not to consolidate or relocate certain facilities and operations locally, while also determining (2) where to locate a new food manufacturing facility in the U. S. Recent M&A activity, high growth business segments (e. g. frozen foods for retail & international store growth), and unique supplier relationships required a comprehensive review across food production, storage (REFR and dry) and distribution operations. Our Approach Our approach to developing a comprehensive network optimization strategy for the client included the following steps: First, we defined in-scope operations & facilities and aligned leadership around the most viable scenarios for potential modeling, Next, we captured baseline and future state space requirements and costs for each business unit and analyzed the as-is distribution network design, mileage and costs. Following this, in order to develop a full picture of the pros and cons for each scenario and geography under consideration, the Honour team analyzed labor availability, cost & competition and provided real estate market research and de novo facility identification. Finally, Honour determined capital outlay estimates related to expansion, construction and potential relocation costs Results Our assessment was reviewed with chief executives, and it provided a framework for final decisions made related to the following: A new geography for the company’s second major food production facility was identified resulting in ~$1. 3 M annual cost savings in transportation, labor & real estate costs. Identified warehousing space utilization opportunities allowing for a 40% increase in REFR storage space while avoiding a significant capital investment Identified ~$500, 000 in annual transportation savings through a location centroid analysis based on optimizing costs, mileage & service levels for the equipment replenishment operation. Savings Identified $1. 3 MM annual savings in transportation, labor and real estate costs Identified $500 k in annual transportation savings for the equipment replenishment operation Space Identified 40% increase in REFR space without significant capital investment