MorrisAnderson Operations Turnaround Improves Profitability
Bradley Caldwell, Hazelton Pennsylvania
Pet and Garden Product Distributor. $175 million sales. $25 million debt. Distributing to companies in 24 states from 2 distribution facilities. Over 30,000 SKUs.
- Family owned company that had recently seen margins squeezed and profitability reduced.
- Company had relocated part of the warehouse to a new facility to improve operations. Unfortunately, the change had the opposite effect and delays had become frequent.
- Deliveries were delayed or cancelled as a result of the warehouse issues. Inventory replenishment shuttle transferring product between the two distribution facilities inefficient and expensive.
- Delivery routes were not optimal due to customer demands and the expansive network of customers in multiple states.
- Owner was looking for a strong management team but had struggled to find the right people.
- Team met with management to fully understand past decisions that were affecting profitability.
- Hired as Interim COO to address operational issues and help implement change.
- The warehouse layout was revamped moving high velocity items closer to the staging area to improve efficiency.
- Recommended adding 25% of additional racking to minimize new facility difficulties and to rearrange inventory at new facility.
- Reviewed operations of the warehouse, sales department and processes as well as trucking and logistics operations.
- Analyzed customer and item profitability.
- Recommended implementation of new delivery routing software to handle complexity of distribution to multiple states with a large customer base.
- $5 million of cost savings were identified by MorrisAnderson.
- Our team oversaw a layout change in the warehouse to ensure improved picking operations to reduce delays and improve efficiency.
- Identified unprofitable customers and set up minimum requirements including delivery size and minimum margin.
- Identified obsolete SKUs and worked with client to eliminate SKUs to increase inventory turns, improve cash flow and improve warehouse efficiency.
- Determined trucking improvements that condensed routes, reduced the number of units needed and improved efficiency in delivery.