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Network Rationalization For International Fortune 200 Food and Beverage Company
A leading international food and beverage company with operations in all major continents and countries
Recent changes in local regulation for the country business of interest led to a mandatory reconfiguration of manufacturing and logistics operations. Project involved identifying the extent of the risk and potential damage to operating profits for the major operations across four manufacturing and distribution sites. All products requiring food and drugs administration approval for the local market required careful planning and inventory-ramping to sustain sales during the supply chain rationalization activities.
· Identification of risk to current operations and potential losses
· 4-walls assessment of all sites in the operations network including development of cost, capability and capacity metrics
· Make vs. buy assessment for categories outsourced to third-party manufacturers (TPM)
· Risk mitigation and sustaining quality standards
· Operations network rationalization timeline including project plans for all key individuals
An implementation plan for moving various technologies and supply chain components was devised based on identification, scenario analysis and cost-benefit analysis considering three key scenarios across the four sites. Capability, capacity and cost was attributed to each element requiring relocation and rationalization for each scenario was developed based on projected production and forecast market demand. The highest value and lowest risk scenario was selected based on cost, quality and time factors eliminating the complexity associated with individual relocation efforts. Technology upgrade plans were incorporated into the project to eliminate rework for installation, factory testing and technical/quality qualification procedures.
The project was delivered on time and total losses avoided were calculated at over US$10m with implementation timing and planning accounting for 5 years of variability.