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| Client: | A global leader
in the pharmaceutical industry with worldwide product distribution.
Division of a leading multinational pharmaceutical company. |
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| Problem: | Assess
the optimal number of distribution centers for Europe and the U.S. markets in
order to maintain an optimal inventory level, and evaluate impact on customer
service and cost. | |||||
| Approach: | Use CAPS Supply
Chain Designer to analyze the distribution network and Extend software
to simulate variations on inventory levels. Create baseline scenarios
for Europe and the U.S. with current levels of inventory, transportation
modes and sites. Develop optimization scenarios for each evaluated
market. In the U.S. and Europe, both multiple and single DC scenarios
were developed and evaluated. Level loading and postponement strategies
were also analyzed. A comparative analysis of operations savings was
conducted. | |||||
| Results: | Implementation
of the optimal distribution network and inventory levels will lead to: • Inventory reduction of up to 40% in the U.S. and a reduction of up to 33% in Europe • 99.9% customer fulfillment in the U.S. and dramatic improvement in fulfillment in Europe • Reduction in DC network from five to two DCs in the U.S. and from seven to three in Europe • Total transportation costs reduced up to 34% compared with baseline | |||||
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