Logistics Case Study: NDC / RDC Strategy Investigation

Client: Ethical Products Distributor

Project Aim: Strategic review of the NDC and RDC approach to expand sales volumes, reduce costs and to enable more direct sales as part of a strategic masterplan

Challenge.

For this established ethical medical products business operating from a single NDC, the challenge was to, 

• reduce the ‘cost per picked item’ to industry-leading values;  
• enable doubling of volumes within 10 years;  
• enable a greater proportion of direct Ecomm sales to the end users.

Lorien Approach

Series of workshops to gather current and trend data:

• obtain the base data of SKU volumes, stocking data, regional sales,
• product storage conditions, product supply method. 

Lorien’s analysis of the provided a clearer picture of the network relationships, cross-docking operations, product category trends, volume flows and automation levels.

The team undertook an on-site review of the current operation of the NDC and satellite warehouses, plus a spatial survey of the buildings to assist with possible remodelling.

Our team comprised: logistics specialists, mechanical handling specialist, building design team.

Outputs.

• The analysis led to a challenge of business assumptions regarding the pattern national distribution, and how the expansion could best be developed.  
• Options were developed to replace or retain /remodel the present NDC, and to supplement with a 2nd large NDC/RDC.
• The cost impact of warehouse automation systems in terms of build cost, operation, and manning efficiencies versus the target cost base.   
• Overall build costs have been provided, with a volume plan, a cost-per-line model, and ROI calculations.

Partner with us

In partnering with Lorien you will find people who understand the your industry, and who can guide your projects from concept design through to an operational, commissioned and validated state.  Investment projects can often come with challenges, such as construction and installation of novel designs and processes; tight cost constraints; construction adjacent to live production plant. 

Whatever the challenge may be, with over £3bn of constructed projects behind us, you can be assured that the team at Lorien is very likely to have met similar challenges and managed through to an effective outcome.

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