Supply Chain Design For Growing Companies
A direct marketer of weight and disease management products had been experiencing double-digit increases in sales for five straight years. Vital to the company’s success is the ability to control its supply chain costs while providing extremely high service levels to their customer sets, which include medical practices, weight loss clinics and individuals. With sales projected to more than double over the next five years, the company needed to understand the capacity limits of its existing network, the point at which the network needed to expand and the best expansion locations to most efficiently handle the growing business. The company also wanted to establish an in-house supply chain design team to model future changes.
The company chose LLamasoft® Supply Chain Guru® as its supply chain design platform. In addition to design technology, LLamasoft also provided a “quick start” solution services option to build the initial baseline model while at the same time training the company’s internal modelers help them establish a solid operational methodology. By working together, modelers from both companies were able to format the company’s data and build a model that could be easily maintained and used in the future.
Initial scenarios were run to analyze the impact of adding additional suppliers and to determine the best locations for additional distribution facilities. Variations on these scenarios were run to see the impacts of various rates of growth on the proposed network changes.
After running over 20 different scenarios through Supply Chain Guru, the company has a solid supply chain network design to support future company growth. They now know when they will need to expand their distribution footprint and sourcing capacity and the best locations to consider for new facilities to support growth. Equally important, the company now has the capacity to do this modeling in-house, making it possible to continuously re-assess their network design.