Scope

The scope covers the footprint and flows for distribution of finished goods from manufacturing and suppliers to customers. In other words; where to locate your intended facilities, whether it's distribution centers, fulfillment centers, or warehouses, and which customers should be served with which products from each location.


Objectives

To establish the distribution network that:

  • Maximizes the customer service

  • Minimizes the logistical costs

  • Maximizes flexibility

  • Maximizes robustness to minimize the risks when the conditions change


Deliverables

1. Best Distribution Network 

A recommendation of the overall best distribution network, based on cost and service level, from warehouse to customers.

2. Alternative Networks

At forecast volume, various conceptual alternative networks evaluated based on transportation costs, warehousing costs, inventory carrying costs and service performance levels.

3. Supporting Analysis

All supporting analysis, including planning factors, demand factors, supply/demand maps, risk analyses, market analysis, local opportunities and others as identified or required.

4. Noted Improvements

As data is parsed and the project progresses, any observed opportunities for improvement in the distribution network will be relayed as they are identified.

5. Implementation of the recommended distribution network

We plan and manage the implementation to ensure no business interruption. Tasks include:

Project Detail Planning

Creating and agreeing on an implementation plan that minimizes business disruption, generally in Gantt chart format.

Bid Management

Handling all aspects of bid management, including: developing RFPs, soliciting RFPs responses, evaluating supplier responses, assisting contract negotiations.

Implementation Management

Managing physical implementation: coordinating vendor scheduling, maintaining implementation plan, managing any unforeseen issues, verifying installation quality.

 

Methodology

The Establish Way

The four main criteria, quantitative and qualitative, of each concept are:

 

Transportation

Analyzing transportation costs and service levels based on modes and requirements.

Warehousing

Determining the sizing and staffing levels, while identifying the lowest cost for each required facility.

Inventory

Calculating the effects of each concept on inventory and service levels.

Sensitivity

What-if analysis to determine the robustness of each alternative.

Planning Factors

 

Pools/ Consolidations

Route Optimizations

Mode Optimizations

Other

Outsourcing to 3PL

Warehouse Efficiencies

Economies of Scale

Regional Opportunities

Deployment by Facility

Vendor-Managed

Customer-Specific

Other

Risk Analysis for Unwanted Factors

Assumption Evaluation

Forecast Validation


Why establish?

  • Establish has experience from hundreds of supply chain network optimization projects.

  • We are supply chain management consultants, which means that the qualitative and practical aspects are included in the evaluation besides the mathematical algorithms.

  • Establish is totally unbiased, which guarantees that the solution is optimized for your operation.

  • To optimize a distribution network it takes skills and experience in transportation, warehousing and inventory management. We have it.

Contact us for more information on our services.