Rapid Growth Requires Additional Distribution Capacity

A distribution network analysis helped this rapidly growing retailer achieve immediate and long-term storage goals, expand facilities and increase throughput capacity.


Client Overview
  • A  privately owned, highly successful multichannel retailer of discount tools. Established in 1968, the company currently operates more than 400 retail stores across the United States and anticipates fast-paced store growth over the next five years.
  • The retailer was aggressively expanding its store network, with plans for as many as 1,000 stores.

Challenge

  • Aggressive expansion created stress on the existing network, which needed additional capacity.
Tompkins’ Role
  • Perform a best practices review of the South Carolina distribution center (DC) as well as a distribution capacity analysis of both the South Carolina and California DCs.
  • Provide a distribution network analysis to determine the optimal number, location, size, and role of DCs to accomplish their objectives, including meeting defined growth projections.
The Results
  • Provided recommendations to improve productivity, safety, housekeeping, service levels, and storage utilization for the South Carolina DC.
  • Determined that more capacity was required for the DCs in South Carolina and California to achieve immediate and long-term storage goals.
  • Made recommendations that enabled each DC to increase throughput capacity for their full case and broken case picking operations.
  • Analyzed alternative network options, with the final recommendation being a three DC network. This will involve an expansion of the South Carolina and California facilities, along with a third DC to be located in or near Dallas, TX.