Distributor - Process optimization, Postmerger

For a large-scale paint manufacturer and distributor – performance improvement in the purchasing of transport services in the context of a post-merger integration

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The client and context:

· The client is one of the largest paint manufacturer and distributor in the world.

· They grew their network in a market through an aggressive external growth policy.

· The company wanted to integrate better its supply chain and rationalise the purchasing of transport services.

The challenges:

The newly acquired businesses had been poorly integrated and the company had a complex and inefficient distribution network centered around 5 distribution platforms across the territory. The company’s financial performance became poor and the supply chain became the highest area of loss generation.

What we Did:

· We rationalised the client’s supply chain, moving from 5 to 2 warehouses supporting the entire distribution network.

· We reviewed the purchasing of transport services by:

· Analysing the transport pattern to negotiate on what would really impact the service

· Massification and rationalisation, going from over 10 transport providers to just 2

· RFQ and support to the client on the negotiation of new transport contracts

What we achieved:

We reduced the overall spend in transportation cost by 27%, of which 12% was due to warehouse rationalisation and 15% due to better purchasing processes, rationalisation of couriers and renegotiation of transport rates

10% of orders have had their delivery lead time reduced by 1 day or more thanks to better transport performance