Eldorado Company, a huge electronics retailer in Russia, with stores in 350 cities, needed to determine the optimal number of warehouses, and where they should be situated, in order to better fulfill customer demand and minimize delivery and storage expenses. The analysis showed that the problem could be solved with introduction of the anyLogistix supply chain optimization system.
Input data provided by the customer described potential warehousing points: rent cost, investments for building new or modernizing old warehouses, average level and cost of storage, overall costs for staffing and security, etc. In addition, the anyLogistix simulation model considered the warehouse and retail store GIS coordinates, and distances between cities.
The introduced system allowed the client to simulate, in detail, several kinds of activities:
Monthly sales numbers conform to average sales numbers, while daily sales are generated stochastically.
Users can carry out several experiments with the model:
The supply chain optimization project allowed the retailer to choose positioning variant of a warehouse network out of 63,000 combinations. The software implementation costs are paid off during the first two months of work when using the distribution network system recommended by the model. The decision support system is expected to operate for a long time, as it allows the users to find new optimal distribution system setups in case the market situation changes (change of transportation tariffs, warehouse parameters, amount of stores and sales, etc.).request a demo
A large European home improvement goods manufacturer was challenged to move one of its factories to another city due to an increase in rent. The supply chain analysts had three possible places for relocation. They had to choose one based on client geography and locations of other factories and warehouses.