Facilitating Business Growth

Details

CJ Logistics helped one CPG/Beverage customer combine its newly acquired business units, creating an optimized distribution network, enabling its continued growth. The new network reduces complexity, lowers costs, achieves load consolidation across the customer’s combined units as well as optimizes the cost and service benefits of multi-customer consolidation.

Situation

CJ Logistics serves as a Lead Logistics Partner (LLP) for a CPG/Beverage customer, managing the company’s entire supply chain in the US. Prior to working with CJ Logistics, the customer’s acquisitions had resulted in a US supply chain network with overlapping distribution channels and multiple distribution centers in the same city. Operating in silos, buying on an individual unit’s purchasing power rather than leveraging the power of the whole organization, the customer asked CJ Logistics to help solve the problem through a network redesign.

Solution

CJ Logistics started the process of helping make the customer’s supply chain more efficient by using industry-leading modeling software to baseline their existing network. As a result of the customer’s growth through acquisition, they had four unique business units operating as four disparate supply chains. Three of the business units served a variety of major grocery retailers while one of the business units shipped to food service customers.

After establishing the baseline, the Solutions Team moved to the optimization phase, collaborating with the customer to run several scenarios and then determine the recommended solution: one fixed site connected to a production facility plus five CJ Logistics multi-customer facilities, a solution that reduced the total number of US distribution centers. Using CJ Logistics’ transportation optimization tool, the team built an optimized transportation network by creating consolidation across multiple business units, identifying transportation opportunities for this customer to leverage our multi-customer consolidation capability with service into major retailers.

Result

The CJ Logistics-designed network achieves efficiency in combining this customer’s US business units. The new network reduces complexity, lowers costs and optimizes transportation, leveraging consolidation within the four business units as well as with current CJ Logistics customers. Leveraging CJ Logistics’ multi-customer consolidation program enables further cost reduction, and, most importantly, increases service levels to key customers.