Reduced 50% Transportation Cost and over 90% Warehouse Overtime for a Multinational FMCG-Pharma Giant
Published on: May 2021
The FMCG-Pharma companies often cater to a large geographical area, serving a wide network of customers, retailers and healthcare providers. While operating across such large areas, it becomes even more important to optimise distribution networks, establish robust transportation infrastructure, and implement advanced inventory management system for timely and cost-effective deliveries.
The challenge of two distribution centres serving similar areas
The client, an FMCG-Pharma company, had been operating out of two distributions centres serving similar regions. The warehousing operation was managed by a local carrying and forwarding agent (CFA) and another vendor handled parcel distribution providing limited visibility into the distribution process. Even though operating in multiple shifts, the distribution centres had less than expected throughput and low distribution visibility.
Revitalising Distribution Operations with Our Integrated Warehousing & Distribution Solutions
Implementing our integrated warehousing and distribution solutions (IWD), we established one Central Distribution Centre to serve the entire Telangana and Andhra Pradesh region, and effectively managing their end-to-end transportation. We meticulously planned and designed optimal routes for milk-runs, ensuring they can accommodate delivery Turnaround Times (TATs) efficiently. Additionally, we prioritised outbound deliveries over inbound to free up docking space. By implementing a robust tracking system, we provided 100% visibility on vehicle placement to the warehouse, allowing for daily picking plans that effectively minimise resource bottlenecks.
Igniting Success: Driving Profitability and Cost Savings
- 50% reduction in transportation cost due to implementation of optimised milk runs
- Over 90% reduction in warehouse overtime due to single shift streamlined operations
- Throughput increased to more than 20,000 cases, surpassing the client’s target of 14,000 cases
- Reduction of complaints from 150, in the first 6 months, to less than 10 in 12 months
The successful implementation of various strategies and processes resulted in significant improvements in efficiency and cost savings. The key factors that contributed to igniting success included optimal route design, prioritisation of outbound deliveries, load consolidation and effective coordination. The positive impact on throughput and the reduction in complaints are clear indicators of the success of these efforts.
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