Warehouse and Supply Chain Improvement Project

Overview

In 2018 HRV discovered some challenges in the supply chain. Several key people had left the business following a sale to Vector and it was evident that there were challenges in the warehouse, inventory control and procurement. Henry was engaged by Vector to assess the supply chain and then to provide help to deliver the improvements.

Approach

• Current state assessment and design of future state structure, processes and tools
• Coaching and training to set up cycle counting, root cause analysis and process design for inventory controller
• Introduction of best practice warehouse design and stock take processes
• Network design to consolidate manufacturing and warehouses into 1 facility
• Introduction of basic planning tools and processes to manage purchasing and manufacturing

Results 

• Introduced inventory controls to reduce stock take variances from $1.4 million p.a. to zero for the 2020 Year
• Consolidated manufacturing and warehousing from 2 facilities into 1
• Set up a supply chain structure to manage procurement, warehousing, planning and operations
• Led the recruitment and development of key people in the new structure
• 1 year on the Supply Chain is delivering ongoing savings:
  Procurement > $1 million
  Labour $235,000 p.a
  Warehouse costs $215,000
  While Inventory value has reduced by 20% and service has improved from 100 sku’s out of stock to less than 15 at any one point, (out of 1000+ sku’s)