Page 259 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Logistics and Supply Chain Management

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Case Study Total Logistics Adding Value for Premier Farnell

arnell InOne is Premier Farnell's web-based eBusiness, stocking more than 250,000
products. In delivering the full catalogue in Europe while simultaneously cutting
Fcosts, Premier Farnell commissioned Total Logistics supply chain consultancy to
design and implement the required logistics solution for expanding the company's Preston
and Leeds distribution hubs to include Liege in Belgium.
Premier Farnell had successfully expanded its Farnell InOne eBusiness to cover the whole
of Europe using its Leeds distribution hub, but wanted to cut the next-day delivery costs -
particularly the express air carrier charges – required to maintain service levels. In addition,
the company simultaneously wanted to expand its CPC business – currently based in
Preston – into Europe.
With a new European distribution centre strategy in place for delivering cost-effective
international fulfilment from mainland Europe, three preferred sites were subsequently
identified in Liege, Belgium. Moving European operations to Liege would ease pressures
on next-day delivery while allowing a significant volume of goods to be delivered more
cheaply by road.

Several sites were considered: one existing building, one developer building about to be
constructed and one 'Greenfield' purchase and construct site. The initial warehouse design
work identified and optimum building requirement of 23,000 sq m, starting at 14,000 sq m
and then expanding as required. Premier Farnell has a significant amount of in-house
logistics expertise but felt that additional skills were required on the project. Total Logistics
was selected after a lengthy evaluation process. Premier Farnell's key selection criteria
included practicality, cost-effectiveness, on-time delivery and an implementation that
would not impact on existing operations.
Total Logistic's role was six-fold: to develop a good planning base for the Liege centre; to
evaluate alternative technologies for its operation; to develop the centre scheme designs;
to support the design of the site layout and the site searching process; to produce an
overall implementation plan; and to demonstrate the requirements of the inter-site
replenishment operations at all sites - Leeds, Preston and Liege.
In addition, Total Logistics supply chain consultants identified three optional areas that
would add value to the project and increase the effectiveness of the solution. These were to
support Premier Farnell's IT team with Warehouse Management System (WMS)
development; to develop tender specifications for all storage and handling equipment;
and to implement the final solution design. Total Logistic's own analysis methodology-
Insight-was central to the project approach. Insight is a set of proprietary tools, developed
and applied to translate raw and often incomplete data into relevant information that
helps optimise the resulting solution. Modules spanning inventory, warehousing, transport
and process modelling were applied, all linked across a dynamically maintained, common
database platform.
With the strategy established, planning began by gathering detailed data (to order line
level) and overall familiarisation with the operation. This drove the Total Logistics Insight
models which then generated a number of potential design options to ensure that every
relevant factor was taken into account.
Contd...

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