Warehouse Network Optimization for Rapid Point-of-Care Diagnostics Manufacturer

The client’s Indian subsidiary had a pan Indian presence through 200+ distributors. The subsidiary is currently serviced by three Distribution Centres (DCs). The client engaged a logistics service provider (4PL) to handle supply chain operations from port to customer but wanted to redesign its warehousing distribution network in India to increase efficiency, lower costs, and achieve higher levels of serviceability.

Nexdigm delivered the project by focussing on achieving higher efficiencies in cost and service levels through rebalancing of demand load and adding a warehouse to the network. Other suggestions included reworking the existing transportation lanes, tracking outbound costs, negotiating a penalty clause with the 4PL partner for SLA slippage, and accurate demand planning.

Our high-accuracy demand planning solution and warehouse space utilization technique helped realize cost savings of 16%. Our suggestion to replace current transportation lanes with other recommended partners managed to increase service levels by 7%. We also recommended an addition of a fourth warehouse at a strategic location as well as the relocation of an existing warehouse, which resulted in an additional 27% savings in supply chain costs.