Supply chain network optimization plays a key role in controlling costs, managing complexity and increasing profit margins, but it can do even more for your business. An optimized network can reduce your carbon footprint, help you meet broad sustainability goals, increase the delivery quality of your products and ultimately result in added value, differentiation and a better customer experience.
Tompkins goes beyond the fundamentals to develop strategically robust and responsive networks for our clients. The configuration, equipment, capacities and placement of your facilities are planned with consideration of cost fluctuations in inputs, product lifecycles, changing distribution channels, market segmentation (and new opportunities), regulatory changes, demographic shifts and economic events. We also offer organizational design & change management, site selection and coordination of construction, equipment, installations and material handling systems integration to deploy your optimized network.
As a full-service consulting and implementation firm, we will be with you every step of the way, from the initial planning and design to transition and training for your new network.
Don’t just take it from us. Learn how our projects deliver on our promise of high impact, high value and high confidence in the client examples below.
Chemical & Consumer Goods Company
Network Design & Transportation Study
Redesigning the network to streamline and optimize the company’s manufacturing and distribution operations
- Detailed analysis of current network and validation of potential cost savings
- Custom data model with multiple network scenarios
- Achieved $4M in annual savings
- Provided valuable insight into network dynamics and the advantages of integration to minimize transportation costs
Children’s Apparel Company
Supply Chain Strategy & Network Design
Developing an overall supply chain strategy and optimal North American distribution network to accommodate growth across family of brands
- Redesigned logistics operations capable of supporting multiple brands and sales channels
- Network strategy optimized for cost reduction, operational efficiency, customer satisfaction and future growth
- Increased capacity by 28%
- Reduced costs by eliminating the need to engage a third-party logistics (3PL) provider
Food & Uniform Services Corporation
Network Optimization & Labor Analysis
Multiple understaffed facilities and a network design unable to accommodate increased capacity and drive long-term value
- Automated facilities capable of offsetting labor shortages, supporting projected growth and reducing costs
- Optimal network design based on proximity to carrier services
- Increased capacity by 39%
- Reduced annual operating costs by $800K
International Power Management Company
A massive and highly decentralized network with varying capacity and customer service requirements
- Logistics network strategy capable of meeting growth and service goals
- Centralized distribution network focused on optimizing inventory, operating and freight costs
- Designed a cost-effective distribution network that reduced the number of facilities by 25%
- Developed a centralized strategy that enabled the client to consolidate shipments to customers across multiple business units
Outdoor Power Equipment Manufacturer
Logistics Study & Network Optimization
Identifying and implementing service improvements across the manufacturer’s multichannel distribution network
- Cohesive improvement plan for multiple sales channels and a diverse product line
- Network design and strategies focused on reducing service times and costs
- Expanded three-day service coverage to an additional 25% of customers
- Reduced costs by $3M over a five-year growth horizon
One of the key tasks at the start of most any assessment or design project is to determine the storage and throughput capacity of the current facility or facilities. A root cause analysis will uncover systematic issues and lead to gap identification between current capacities and the requirements.
Factors that can impact a facility’s capacity are storage and material handling systems, labor availability, facility size or characteristics, information systems, order management and processing. As opportunities are discovered, alternatives to close the gap will be evaluated and recommended, including:
- Maximizing throughput of current equipment and processes
- Optimizing all available storage cube of facilities
- Streamlining information flow between systems
- A physical expansion of the facility
- Additional distribution/fulfillment nodes in the network
- Outsourcing capacity
Designing distribution networks requires an understanding of the organization’s objectives, goals and strategies. Traditionally, cost has been a very important factor in designing distribution networks but in today’s world, it is not enough to just be the low-cost supplier—consumer expectations are also a driving factor in these designs. Inventory positioning, order cycle time and proximity to the customer all need to be considered when discussing order lead times.
At Tompkins, we believe that a successful network design project is predicated on understanding the nuances of the client’s business model. Our network design services attempt to answer important questions specific to your distribution strategy, including:
- How many distribution and/or fulfillment nodes should you have?
- Where should they be located?
- What is the configuration and purpose of each node in the network?
- Which customers should be serviced by which node(s)?
- How are customer orders processed?
- How will each node be replenished?
- How should shipments be scheduled?
- What service levels should be offered?
- Which transportation methods should be used?
- Should all or part of the network be outsourced?
Tompkins utilizes several modeling tools for our network designs. We design flexibility and robustness into our models, allowing quick adjustments and “what if” analysis in many aspects of the network model. These tools are deployed based on the volume and complexity of the distribution network and if the client may want to learn the modeling tool themselves for future use.
Our network modeling helps organizations optimize their distribution networks and also prepare for market volatility and risk mitigation. Flexibility is key and organizations must plan for changing market conditions, such as:
- Geographic and demographic shifts in production and consumption
- Market segmentation and new markets
- Changing distribution channels
- Changing customer service requirements
- Cost fluctuations in energy, transportation, taxes, leases, labor, etc.
- Government policy, regulation or deregulation
- Product proliferation and life cycle
- Competitor adjustments
- Acts of God or force majeure
- Private or public sector disruptions
- New global market opportunities