Distribution & Logistics
Improving Cost-to-serve at Premium Baked Goods Company
Created a new logistics strategy, including implementing a new DSD network and delivery process, developing a new transportation and warehousing strategy, and re-balancing production among plants. Over 75% of the $2.5MM in savings (from a cost base of $12MM) highlighted in the strategy was saved in the first year of implementation.
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Cleaning Up Distribution as a First Step in Establishing a Growth-supporting Distribution Platform at National Seafood Company
Conducted a diagnostic to reduce distribution costs as a part of an effort to integrate the distribution systems of two companies by identifying and sizing cost levers with savings benefits (quick hits, process changes, and cultural changes). Targeted cost savings of $1.5 to 2MM on a base of $7MM, of which $1MM are estimated to be achieved by quick hits alone.
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Unlocking Truck and Parcel Freight Savings at Portfolio Companies of Middle-market Private Equity Firm Freight
Created fact base for leveraging $11MM of freight spend across 3 portfolio companies of a middle-market private equity firm. Facilitated communication between management of portfolio companies to understand service requirements and the manner in which the individual portfolio companies would conduct freight negotiations. Led RFP process and analyzed new bids based on 2 years of historical freight spend. Created an evaluation matrix based on both cost and service to facilitate vendor selection. Purchasing consolidation led to $1.2MM in savings in the first year and improved freight service.
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Establishing True Cost Picture And Identifying Operations Improvement Opportunities
Conducted a profitability diagnostic study for a promotional mattress manufacturer with nationwide operations and a multi-plant network. To this end, Gotham followed a data-driven approach to dissect and analyze the company’s operations, including: building the true cost picture by analyzing and reconciling multiple large and disparate data sets ranging from company-level accounts to invoice level information; profiling profitability across plants, products, and customer segments; analyzing customer churn impact by profiling profitability across new, retained, and lost customers; developing a comprehensive analytics platform on Excel to help provide the company with a recurring monthly view of cost and profitability; and identifying fact-based improvement opportunities. This data-driven approach helped our client gain clarity over the true cost picture and drivers of profitability and sales decline, and launch a focused operations improvement effort supported by robust facts.
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Rapidly Capturing Manufacturing And Logistics Cost Reduction Opportunities At Ethnic Foodservice Products Manufacturer
Captured $1.2MM in operations run-rate savings in 12 weeks at an ethnic foodservice and retail private label products manufacturer by implementing shop floor management best practices. Gotham worked on the shop floor to: observe operations; identify potential improvement opportunities; provide immediate guidance to client personnel; and troubleshoot and pilot solutions. We improved line through from ~225 cases/shift to ~375 cases/shift, reduced fill weight by 3-7% to minimize overfill, reduce floor scrap by 50%; and eliminated expired rework scrap. To ensure sustainability and further improvements, we: trained client personnel, put in place process changes, tools, KPIs and reporting system; and identified/planned next set of improvement opportunities. Gotham also launched logistics savings capture by developing direct ship pilot and facilitating conversation between company sales teams and foodservice distributors.
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Rapidly Establishing Manufacturing Outsourcing Economics And Requirements At Family-owned Food, Personal, And Home Care Products Manufacturer
Conducted rapid operational due diligence to establish manufacturing outsourcing economics at a family-owned food, personal care, and home care products manufacturer. Gotham quickly: built a bottom-up view of the target’s cost structure, current product costs, co-pack costs, and organization structure; conducted plant walkthrough and interviewed operations management; and interviewed companies in food and personal care products outsourcing. We established that outsourcing economics are slightly favorable as logistics and G&A would generate sufficient savings to more than offset a slight increase in food manufacturing cost. As our assessment indicated higher costs and risks associated with outsourcing food products, our client successfully pursued a restructured transaction of carving out personal and home care brands and products.
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