This blue-chip PLC had manufacturing plants situated at several sites throughout the UK. The logistics side of the business was based at a central warehousing and distribution facility from which also housed the logistics Management and Administration teams.
Three satellite units supplemented the main "picking" warehouse for the group; unfortunately, they were hundreds of miles apart! In addition to the running costs associated with the warehouses, several other problems had emerged:
Stock had to be transported between the various sites
Products held in storage were often duplicated, leading to over-stocking
The operation was difficult to manage effectively, mainly due to the geographical constraints
Our solution centred on consolidating onto one site, consisting of a main warehouse and a back-up store to handle seasonal products. We also devised a complete working layout and a series of standard operating procedures to accompany the changed conditions.
As a result of the project, two of the warehouses were closed, stock was reduced and the new layout led to more efficient picking and despatch.
Distribution
Our client had a problem within the transport and distribution department. The company is part of a well-known PLC and had a fleet of around 20 vehicles, delivering to all sizes of retail outlets throughout the UK. These ranged from "corner shops" to warehouses.
A new Senior Manager had been recruited who had identified some fundamental flaws in both strategy and operation within the department.
At this point, we were asked to provide him with Consultancy assistance as a means of verifying his initial thoughts, devising an improvement strategy and implementing the plan. Our strategy required making a number of changes:
KPI's were developed, covering; routes, mileage, MPG, driver performance etc.
Use of the KPI's resulted in improvements across virtually every area
The company's rules and regulations covering the Distribution function were tightened
Distribution department staff were re-trained
The project was undertaken on a basis of 2-3 days per week over several months and resulted in some impressive savings, that included:
The fleet was reduced by three vehicles
Mileage was reduced by 11%
MPG was improved by 9%
Overall, savings were in the order of £225k per annum
