The customer was witnessing exponential growth, but the supply chain and the planning processes were not able to keep up with the change and cope with the new demands. The company was in a competitive market and had to maintain expected service levels of >97% and service time of <4 hours.
The customer realized that the cost increase in the organization was higher than the growth in sales. This reduced the profitability of the business. They also had a large number of SKUs (>50,000) that resulted in high inventory carrying cost and risk of obsolescence.
An optimization model was drawn up to decide the best supply chain structure. This was followed by a detailed study and improvement in the supply chain planning processes.