Operational Improvement at a Consumer Packaged Goods Manufacturer
A large personal care manufacturer wanted to improve order fulfillment, distribution center productivity, management of seasonality, and customer service levels.
Supply Chain Edge assessed the company’s supply chain and implemented a distribution network reconfiguration, a physical material handling system, and a new order flow management system.
The company improved its throughput by a factor of four, line fulfillment by 135 percent, fulfillment accuracy by 85 percent, and rate of orders filled complete by 10 percent, and it cut its internal order cycle in half — all while reducing fulfillment unit costs as a percentage of sales.
A $1.4 billion North American personal care product manufacturer had a portfolio of 8,000 SKUs, which were distributed to food, drug, and mass merchandise stores and warehouses in the U.S. and Canada from four manufacturing sites. To improve its order fulfillment lead times, distribution center productivity, management of seasonal highs and lows, and overall customer service levels the company’s senior management secured consulting and interim management services from Supply Chain Edge.
Supply Chain Edge led an end-to-end supply chain assessment, from finished product release, to the distribution and customer service organization, to retailer sites. Based on this assessment, Supply Chain Edge implemented a distribution network reconfiguration—reducing distribution sites from four to three, increasing fulfillment capacity by 30 percent, and establishing emergency fulfillment backup processes. Supply Chain Edge also implemented a physical material handling system to optimize line and case fulfillment, transportation planning as well as shipping functions. Finally, Supply Chain Edge implemented a new order flow management system that reduced redundancies in the current process and delivered improved quality and customer service—all at reduced cost.
With Supply Chain Edge’s help, the company successfully improved both internal productivity and customer service. More specifically, throughput was boosted from 65 to 270 cases per hour per facility, line fulfillment improved by 135 percent, fulfillment accuracy increased by 85 percent, orders filled complete grew to 97 percent from 88 percent, and internal order cycle time was cut in half (to 1.3 days from 2.7 days). Perhaps most important, all of these advances came with a cost savings: Fulfillment unit costs moved from 2.3 percent to 1.4 percent of gross sales.