Optimizing a Distribution Center for a Growing Foodservice Distributor
By Jennifer Hall
February 2020 | 3 min read
Our client is a rapidly growing foodservice distributor offering a wide range of dry, fresh and frozen products to independent and chain restaurants across South Korea. Their operation consists of case picking, substantial split-case picking across three temperature zones, and a cross dock.
They came to LIDD for help re-engineering their operations to boost efficiency and increase capacity & throughput. With limited storage space and capacity issues, they faced shipment delays and excessive labour costs.
Client’s Business Objective
The client expected business growth of 20% in the relatively short-term which would have to come out of the existing facility. To support that, the company needed to increase capacity, improve throughput and optimize their current infrastructure and operations.
LIDD’s Mandate
The client hired LIDD to optimize its facility and operations by:
- Identifying opportunities to immediately improve productivity
- Reviewing slotting and recommend optimal enhancements
- Recommending layout changes that would support the short- to mid-term life of the facility
Executing the Mandate
LIDD started with a detailed operations audit to review the operating methods, information technology support and workforce organization. Following the audit, the team built a model to simulate current and future volumes to define capacity and throughput needs.
The model defined the relevant features and parameters to use in building realistic layout alternatives. Each option was evaluated on:
- Ease of Implementation
- Capital Cost to Implement
- Increase in Capacity (throughput, pick line and/or storage)
- Impact on Productivity
- Qualitative Assessment
LIDD recommended the client reconfigure their racking and picking strategy in both the dry and cooler areas to address their capacity issues. Moreover, LIDD streamlined the facility’s sortation and centralized cross dock activities to improve ergonomics & efficiency. LIDD recommended enhancements to the existing WMS system to improve order picking.
Results
The project immediately improved efficiency and our client has been able to grow their operations within the existing facility while keeping it well-managed and optimized. The company maximized strategic warehouse software features to establish a sustainable and agile distribution center.