Large UK Soft Drink Manufacturer
Supply Chain Network Transformation
When this soft drinks manufacturer approached us, significant growth had been met by upgrading legacy infrastructure in a focused way but with a relatively short term outlook. An ambitious strategy projected further substantial growth: yet this would be unachievable without significant investment. Sequoia's well-honed approach to Network Design enabled the client to evaluate, scenario test, determine and ultimately implement the best investment approach to manage that growth, knowing the £XXmillion investment was the best path.
Problem
- Existing infrastructure included outdated inefficient production lines which not only impacted productivity but also raised operational financial and strategic challenges.
- The logistical constraints of one site and the limited expansion opportunities of two manufacturing sites further complicated the picture.
- With a strong forecast of future growth, the company faced a critical need to rethink its operations and supply chain strategies, aligning them with long-term goals, managing risks, and ensuring adequate capital investment for infrastructure overhaul.
Solution
To address these challenges, Sequoia supported a new, comprehensive operations strategy project, which incorporated a network investment and rationalisation program. This process included multiple stages, such as:
- Infrastructure Evaluation: Current sites were assessed and an independent summary delivered. A shared site's location and constraints required careful evaluation of whether exiting the shared arrangement was feasible or would result in long-term costs.
- Supply Chain Digitisation & Optimisation: The business wanted to assess both Greenfield and Brownfield sites, optimising production capacities and locations to best support future growth. To answer these questions, the Sequoia digital twin considered structural optimisation, operational improvements and logistics consequences in depth. The models incorporated machine learning techniques (Genetic Algorithms), to evaluate a wide range of infrastructure options and identify the most cost-effective solutions.
- Investment Routes & Risk Analysis: Extensive financial analysis was included in the delivery, with multiple investment routes developed for consideration. Analysis included risk assessments, identifying critical uncertainties against which the proposed network design was tested and future-proofed. The Sequoia approach provided a framework to model various timelines and scenarios, considering different investment operational impact and ensuring alignment with the company’s strategic business objectives.
Impact
The result of this in-depth, strategic manufacturing and distribution Network Design analysis was the creation of a detailed, implementable transformation strategy. The key outcomes included:
- Comprehensive Network Strategy: Clarity of long-term infrastructure needs, with a defined roadmap for the next 20 to 40 years. This included investments in new facilities and the rationalisation of existing ones to support growth efficiently.
- Optimised Network Design: The most effective configurations of production sites, distribution centres, and warehouses was identified and widely understood. This design supported both cost efficiency and business performance objectives, ensuring future scalability aligned with growth.
- Financial & Risk Management: The Sequoia approach enabled capital and operating costs to be forecast alongside key risks and priorities for mitigation. The financial analysis provided insight into the optimal investment routes and timescales, aligning capital expenditure with business objectives and ensuring manageable, long-term financial commitment.
- Future-Proofing the Supply Chain: By focusing on long-term flexibility and aligning the supply chain with both business trends and evolving retail and distribution models, the company ensured the infrastructure was equipped to handle unprecedented changes in the industry.
This comprehensive approach delivered a robust, risk-mitigated strategy that not only supported immediate growth but was sustainable, providing the business with a competitive edge in an evolving market.
In fact, the project was so successful, the business returned to Sequoia 10 years later, to update the strategy for the new commercial and operational landscape.
