Optimization of the logistical model for a large multinational frozen food company


Client Situation

A leading frozen foods FMCG company had to face two linked problems:

  • Significant differences in the distribution and logistics activities between the two main brands of the company required a review to achieve possible synergies
  • The decision to transfer the production of one product to another factory required rationalisation of the logistical network.

Approach

The approach used was based on modelling various logistical and distribution scenarios with the objective of achieving the greatest savings while maintaining an efficient and competitive level of service.

  • Number of warehouses and delivery centres necessary to comply with the distribution requirements
  • Size and location of the warehouses
  • Number and location of the transit terminals
  • Definition of the most efficient transport vectors
  • Plans to increase truck occupation
  • Definition of the part of the capillarity that the Logistics Operator had to assume
  • Optimal organisational structure for the new network
  • Potential of logistical synergy for both businesses.

Results

Rationalization of the logistical structure (with a sole national factory) minimizing the costs

  • Number, location and functions of the warehouses
  • Transport vectors and their management
  • Reduction of fees due to joint negotiation
  • Operational cross-dock selection

Restructuring of the distribution network to optimize its costs

  • Number, coverage, functions, remuneration, dependency
  • Reduction in the number of distributors
  • Structural savings

As a result, savings of 24% were achieved.