What did the customer want?
For a large Dutch retailer, the DC (distribution center) is essential. Keeping logistics costs manageable guarantees competitive prices, happy customers, and a competitive position. Our customer’s current DC is no longer sufficient, but which products will we put in the new DC, and how, and why? For the best results, we will make these decisions based on hard facts and data so that we can optimally focus on the DC.
What was our approach?
A dynamic model that determines the optimal allocation in real time, for every situation. We have built an advanced Linear Program that optimally allocates all SKUs within the DC. This optimum is determined on the basis of costs (hourly wages & productivity, return percentages, turnover rate, etc.) but also, for example, capacity and the characteristics of the SKUs. All input is fully customisable so that infinite scenarios can be compared.
What have we achieved?
On the basis of the most recent data and desired adjustments, S & OP can optimally set up the DC. S & OP not only has the tools to optimise the current situation, but can also use it for future changes. Capacity problems are already clear in advance because predictions, in combination with the tool, can determine the ideal DC of the future.
What did the customer think?
Practical logistics experts. Good balance between concepts and practical applications.