HomePublicationsConsultancyLarge food company reviews its transportation models with support from ILOS consulting firm: project aims to reduce logistics costs.
Large food company reviews its transportation models with support from ILOS consulting firm: project aims to reduce logistics costs.
ILOS provided consulting services to a large company in the food sector. The project's objective was to improve service to the Brazilian market through recommendations on logistics network and transportation strategies.
Due to its highly fragmented logistics network, the company used various types of delivery methods and diverse customer channels. This complexity resulted in difficulties in managing transportation, as well as in managing the portfolio of carriers used to execute this operation.
ILOS suggested reviewing the operating models used, varying by region and service channel. The proposals indicated a reduction of 0.7 percentage points in the logistics cost-to-net-revenue ratio.
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project type
Optimization of the logistics network
transport strategy
Segment
Consumer goods
Potential for a 0,7 percentage point reduction in logistics costs as a percentage of revenue through operational optimization.
Challenge
A global food company, with a distribution network of over 20 delivery points in Brazil, was registering worse-than-desired service and logistics cost indicators. The company faced difficulties in managing its carriers, with manual processes and contracts lacking SLAs.
ILOS solution
Based on market data analysis and detailed information about the company's operations, ILOS recommended actions for each level of the company's logistics network. Strategies for dedicated fleet versus trip-based contracting were reviewed, adapting them to each region and operational profile. In addition, an adjustment to the relationship structure with each carrier was proposed.
Results
ILOS' proposals indicated a 0,7 percentage point reduction in logistics costs as a percentage of revenue for the company, compared to the market average. This reduction would be achieved through adjustments to transportation operations, with specific decisions for each demand segment.