Identifying sustainable cost reductions
As part of its yearly planning process, our client, a building products manufacturer with annual revenue of $100m, determined that value was being lost to the business due to inefficiencies in the logistics network.
A business initiative was instigated to review the current logistics framework with the primary objective of identifying the optimal logistics framework to deliver the client sustainable reductions in logistics expenditure.
Current and future state
The Prological team completed a current state assessment through operational observation, data analysis, internal freight capability, third-party freight capability, demand profile by customer and delivery option modes.
Opportunities to reduce cost and improve service were derived from understanding the proportion of freight that could travel via specific vehicles.
Optimisation and right-sizing
Approximately $420k of annual freight savings were derived from this process through, run/route consolidation and optimisation, right-sizing the transport fleet and introducing new design principles for vehicles.
