Warehouse Turnaround | Case Study 1

Distribution Center Turnaround - A large supplements division of a $53B global CPG company found itself in big trouble entering Q4 with an under-performing central DC, which was backlogged, missing shipping schedules, messing up orders to major retailers, and creating a huge risk of missing the year-end revenue target by 35%. The DC was shipping 25% of expected daily volume with low inventory accuracy at arrival. The client needed to turn around the failing DC, clear up the backlog, and hit the revenue goal within 2 months.

Senior leaders were engaged to review plans, set expectations, and add labor to start untangling the DC, such as by implementing process controls, conducting a physical inventory, reconfiguring the receiving and shipping docks and selection locations for improved picking accuracy, and setting up a piece-pick zone for small pack orders. Meanwhile, new procedures were created for order planning, labor planning, and routing and truck scheduling. All associates and supervisors were retrained.

The DC quickly shifted from chaos to control. The client was thrilled to see shipping volume ramp up with increasing accuracy and on-time shipment. More importantly, the client hit its revenue target by year-end. During the next 2 months, processes stabilized.