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The Situation:

A mail order catalog company in the business of servicing the educational markets began to lose customers due to late deliveries and order accuracy and completeness while the cost of operations continued to climb.  The Highland Group was asked to improve the effectiveness of their supply chain.

The Driver Goal:

• Increase the percent of on-time orders from 68% to 95%
• Reduce cost per line shipped by 17% achieving $8,000,000 annualized savings

• Designed and implemented a system to manage the product life of each SKU and to identify and eliminate non-performing SKUs
• Developed methodology and model for determining best location for placement of SKUs across seven distribution centers to attain optimum customer satisfaction and reduce inventory waste
• Reduced freight costs by consolidating same day, same customer, multiple orders into fewer manifested cartons
• Reduced shipping costs by consolidating orders onto larger shipments, reducing bills of lading charges and by optimal alignment of zip codes to Distribution Centers with more favorable regional carrier rates
• Initiated a vendor performance reporting system and established roles and responsibilities for vendor interfacing
• Implemented the best practice of purchasing products in the same configuration in which they are sold, reducing handling costs and miss-picks
• Optimized warehouse operations, improving accuracy of customer orders through pick face realignment; reduced cost per line through process improvements, standardization and labor staffing master scheduling
• Established critical business rules for customer satisfaction and implemented supply chain reporting metrics for improved management control

• Increased the percent of on-time orders from 68% to 95%
• Increased order completeness by 4% while retaining accuracy
• Reduced cost per line shipped by $7,124,000 by project end and on target to exceed plan of $8,000,000