Case Study: Distribution Strategy

The Challenge

• An international manufacturer of aerospace, automation, power and transportation products sought recommendations regarding a pan-European network for after-market product distribution.
• The company’s logistics network for after-market goods was developed by acquisition and actions that were fundamental to the business. The change to the strategic business unit (SBU) approach meant that the benefits of leveraging volume through a logistics network should not be lost in the process.

Tompkins' Role

• Visited more than 20 locations to better understand each facility’s individual requirements and ensure that the needs of each SBU would be supported by the recommended network solution.
• Performed a network analysis using CAPS modeling software to determine the optimal locations for each facility. Consideration was also given to utilizing a third-party logistics provider.
• Provided three options for possible locations and recommended the company seek a third-party provider.
  

The Results

• With implementation, fulfillment rates will increase, while inventory levels will be minimized through reduced safety stock.
• Savings opportunities in excess of 30 percent of total logistics costs were identified, and manufacturing efficiencies were projected to improve by balancing the demand on each plant.