Benchmark Report Reveals Decreasing DC Costs

Supply Chain Consortium: Distribution Improvements Alleviate Financial Strain

RALEIGH, NC, September 22, 2009 -- Supply chains are finding greater savings today from distribution improvement efforts, according to the Supply Chain Consortium's survey of top retail- and manufacturing-related companies.

The Core Benchmarks Report notes that distribution center (DC) costs as a percentage of revenue are trending downward as compared to last year.

"Companies have put a lot of effort into cost savings," says Bruce Tompkins, Executive Director of the Consortium and author of the report. "And with supply chain costs and transportation costs increasing, distribution is an area where companies are able to alleviate some of the financial strain."

The data for the report also shows that there is a higher degree of variability in DC costs as a percentage of revenue than with transportation costs, which indicates that some companies are increasing the costs of distribution in order to significantly reduce transportation costs and improve customer service. However, in general, DC costs are decreasing and many companies are focused on strategies to improve DC productivity. (See table below for the survey respondents' average DC costs as a percentage of revenue by segment.)

Other than financial benchmarks and cost comparisons, the Core Benchmarks Report sheds light on benchmarks for:

• Supply chain planning,
• Sourcing,
• Transportation,
• Distribution operations,
• Manufacturing, and
• Technology.

The full report is available to Consortium members, and "contributing members." For companies that are interested in becoming members, there are several tiers available, including a free contributing membership level. To learn more, visit the Consortium website and choose the "new members" option. The Consortium also has a LinkedIn group for companies that are interested in benchmarking and best practices.

Contact Information 
Keri McManus
Tompkins Associates
919-855-5516
kmcmanus@tompkinsinc.com

About the Supply Chain Consortium 
The Supply Chain Consortium is the premier source for supply chain benchmarking and best practices knowledge. With more than 300 participating retail, manufacturing and wholesale/distribution companies, the Consortium sponsors a comprehensive repository of 17,000-plus benchmarks complemented by search capabilities, online analysis tools, topic forums and peer networking for supply chain executives and practitioners. The Consortium is led by the needs of its membership and an Advisory Board that includes executives from Campbell Soup Company, Hallmark Cards, Hewlett Packard, Ingram Micro, Kraft Foods, Miller-Coors, The Coca-Cola Company, Target, and True Value Hardware. To learn more about how your company can become a member of the Supply Chain Consortium, contact John Foley, 919-855-5461 or learn more here.