Consolidate your supply chain footprint
Consolidate your supply chain footprint

Supply Chain Consolidation

A "supply chain footprint" is another expression to describe your entire supply chain network, from inbound inventory receipting through final outbound customer order despatch. As inventory flows through a matrix of warehouses, distribution centres, manufacturing facilities or external 3PL providers, your supply chain manager is tasked with understanding the end to end supply chain, its capability, constraints and total cost.

Whether your organisation is pursuing growth through acquisition, launching into new markets, or looking to increase service levels across the supply chain network, this strategic direction must be supported by the right sized supply chain network. We discuss a number of important factors that you must consider when you consolidate your supply chain footprint in-line with your supply chain strategy.

Customer Service Level

  • What customer service level do we need to set as an organisational target to satisfy all of our customers?
  • Is the established customer service level achievable for all customers or some?
  • Do we need to differentiate our customer service level for remote or regional customers?
  • How do we strengthen our supply chain network to reach our customer service level targets?
  • What is the cost to our business for maintaining a high customer service level?

Warehouses

  • How many warehouses are required within supply chain network to operate efficiently?
  • Do we understand the total cost of running a warehouse within our supply chain network?
  • Do we continue to lease warehouses in remote locations to achieve high service level targets?
  • What size warehouse do we really require to support our inventory requirements?
  • How can our fixed costs be managed better to reduce our supply chain cost to serve?

Inventory

  • In a multi-vendor supply chain, how much inventory should be held in every warehouse?
  • How do we range our inventory for each warehouse to provide high customer service levels?
  • What is the right mix of inventory investment for each facility within our supply chain network?
  • Do we implement a centralised or decentralised inventory management policy?
  • Do we underestimate the cost of moving inventory between warehouses to fill customer orders?

3PL Warehouses

  • What is the real cost to move to a 3PL business model for our supply chain network?
  • How do we manage the performance of a 3PL provider and are we getting real value?
  • How to we determine which 3PL provider is the right partner for our business?
  • What is the right 3PL cost model for our organisation and can we share the benefits?
  • Outsourcing to a 3PL requires specific knowledge and skills, do we have the knowledge in house?
  • Relationship management and loss of direct customer interaction needs to be carefully considered.

Systems

  • What is the impact on our ERP and WMS systems when we consolidate our supply chain footprint?
  • Migrating different ERP systems requires specialist systems knowledge and understanding
  • Do we migrate different systems or standardise to a single ERP platform?
  • What is the impact on business reporting systems and data integrity?
  • Functional changes with WMS will require a change management program for smooth implementation
  • What is the true cost of running multiple supply chain technology platforms within our organisation?

Next Steps:

A Turn Key Solution offers your organisation the same opportunities to improve the health and direction of your supply chain, logistics function or warehouse operations.We provide supply chain assessment modules, process simulation, warehouse automation, business integration and quality supply chain resources for project management or interim support to build a sustainable supply chain for your organisation.