Background
B&M
Retail is a fast-growing discount retailer based in the
North of England. The company offers consumers a fast-changing
range of 8,000 food and non-food lines with many seasonal
products and opportunity buys. The company was planning
to double the number of stores and wanted to understand
the impact of these changes on the logistics operations
and to ensure they were capable of supporting the business
in the future.
An existing logistics strategy had recommended spending
over £3m on developing new facilities and the company
was concerned that this did not represent good value for
money. We were asked to undertake a fresh review to ensure
a cost effective result and one which could be implemented
without disruption to existing operations.
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Activities
Bisham
Consulting analysed the service and cost performance of
the current logistics operations including transport,
warehousing, inventory and systems. A Cost-to-Serve model
was developed to provide a benchmark against which to
review future alternative options. Using software tools,
we modelled the future forecast volumes, store locations,
inventory levels and warehousing requirements to determine
the optimum network configuration.
During the course of the analysis, a number of areas for
improvement were identified; in particular, inventory
and order management, warehouse management systems and
productivity. A key finding of the study was a recommendation
to re-develop the existing 220k sq. ft. Distribution Centre.
This involved relaying the concrete floor and re-equipping
the facility over a period of 2 years to minimise costs
and avoid disrupting continuity of service to stores.
We helped to plan and project manage the successful implementation.
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Outputs
· A 5 Year
fully-costed logistics development plan to improve performance
and profitability
· Warehouse Management Systems specification and development
Recommendations of improving capacity and productivity
· A Distribution Centre refurbishment and implementation
plan
· Project management to assist in implementing our joint
recommendations |
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Results
·
New 5 year flexible logistics development strategy to
handle planned growth.
· An operating plan to reduce costs by 25% with
an improvement in net margins by 1.5%
· A £2m capital project to refurbish a 220k
sq. ft. Distribution Centre delivered on time, on budget
· Additional storage capacity of 28% and improved
warehouse productivity of 26%
· Improved warehouse and order management systems
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