Case Study

Logistics Scenario Planning for a $80M Furniture Manufacturer

"SLKone developed models and scenarios to optimize the distribution footprint that reduced lead time and overall Supply Chain costs."

Industry
Services Performed

Situation

  • The client was a $80M manufacturer of patio furniture
  • Company had leases expiring at two of their primary distribution centers (California and Texas)
  • In response, the management team looked to review their footprint to determine lower cost options with a focus on reducing transportation costs to customer

Bespoke Solutions

  • Conducted a node analysis that identified customer location concentrations after collecting and compiling shipment data to determine customer locations
  • Gathered data in key areas of personnel cost, i.e. utility rates, lease rates, and headcount costs
  • Developed a model that projected shipments next year to each of their customer locations. This was used to determine distribution centers
  • Ran scenario analyses to evaluate combining multiple distribution centers, ability to close expensive centers, and build potential locations

Leading With Results

  • Completed scenario planning review of the various possibilities across lead time, facility costs, and distribution costs, identifying critical improvement opportunities and prioritized by timing and feasibility to complete with the management team
  • Reduced operating expenses by $1.2M annually (i.e. Salaries, Utilities, and Rent), while increasing warehouse capacity through the consolidation of several facilities into a lower cost state
  • Reduction in average lead time to 1.8 days, from 3.2 days, to customers through operational improvements
  • Avoided Supply Chain disruptions with diversified ports of entry
Case studies and expertise may represent projects and engagements performed by SLKone team members prior to their employment at SLKone