Distribution Network assessment for a medical device manufacturer
Strong product demand for the company’s devices and reagents created order fulfillment backlogs, long lead times, and excessive re-handling costs and damages. Given these presenting issues, senior management sought a five-year plan for providing the business with the distribution capacity to meet expected increase in device models, reagent SKUs, inventories and outbound shipments.
- Data collection: Combined historical demand and shipment data by device type and consumable product category with the company’s five-year product rollout and strategic business plans.
- Network model development: Configured the modeling tool and baselined cost and service performance.
- Scenario-based analysis: Working in collaboration with the operating and product management departments, formulated alternative DC location and inventory deployment scenarios and flow paths.
- Action plan: Identification of milestones, resources and investments required to move forward.
- Clear roadmap for re-configuring the distribution center network to match the concrete product plans and growth aspirations in the 5-year strategic plan.
- Optimization of the cost to serve.
- Knowledge transfer to enable the organization to re-rerun scenarios and modify plans as the business evolved.