Retail logistics strategy


Supply chain strategy

Challenge

A Swedish retail company with 100+ stores in Scandinavia needed to develop a new logistics strategy to meet expected growth of 100% in five years. The project scope covered the following areas; sourcing and material planning, warehouse capacity & -efficiency, stock availability, transport cost and lead time. The most ambitious field regarded the warehouse where the target was to increase productivity by 30%, with or without automation.

Solution

MYSIGMA developed a new holistic concept for the warehouse operations so that the overall performance would not suffer from sub-optimisation of any specific aspect. To achieve the required performance boost of 30%, through levelling workload over daily- and weekly cycles and eliminating all “waste” activities, a complete new methodology for item classification was introduced together with a new layout of the buffer-, picking- and storage zones.

Impact

After only a short while it was apparent that the new logistics concept realised dramatic results

  • Increased warehouse productivity ~ +35%
  • Reduced cost for “external buffer stock”
  • Reduced throughput time which directly leads to increased flexibility by shorter response time

These results allows the client to postpone investment in new-/ relocation to new facilities for at least another 2 years.