Case Study: Evaluating
depot strategy for imported goods
A company operating on a global level
wished to review its UK warehousing and distribution plans for 16 of its
trading companies whose warehousing and distribution requirements were
dealt with from a single location.
The stockholding of goods at this location had been reduced
substantially. The stock for products manufactured in Western Europe had
been moved to the continent. Customers in the UK for these products were
served direct from the continent or, for small orders, by a break-bulk
process through the old stockholding location. However, for goods
manufactured further away, stockholding in the UK was still required.
There was also a requirement for a steady build up of stock of goods
that were produced throughout the year but had a very high seasonal
demand.
We constructed a supply chain model, using the CAPS Logistics Supply
Chain Designer. We identified that the goods involved in the break-bulk
process should be focussed on a series of UK regional depots, as opposed
to the old stockholding centre, thereby eliminating significant
unnecessary mileage. When we examined regional stockholding, the
transport cost savings did not warrant a multi-site strategy and that
although the existing depot was not located optimally, the investment
cost involved in moving would outweigh the benefits.
