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Knowledge Center

KOM International Case Studies

Please click on the title to access the case study.

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A large South American retail grocery company with over 70 stores and some centralized distribution operations.

Scope of KOM International's Mandate

The client was experiencing high distribution costs and poor store service levels as a result of inventory being held across 3 partial-line distribution centers. KOM International recommended the consolidation of these facilities into a single 21,800 square meter full-line distribution center. KOM International designed and implemented the state-of-the-art facility.

Critical Issues

  • High warehouse operations costs
  • High transportation operations costs
  • Product freshness issues
  • Store service levels were below objectives

Objectives

  • Introduce a new full-line grocery and perishables distribution center to service all 70 stores
  • Reduce logistics costs to improve profitability and net working capital
  • Improve perishables product quality at retail

KOM International's Recommendations

  • Multi-temperature loading, shipping and delivery
  • Assured the cold chain for fruits and vegetables throughout the distribution process
  • Shipment of selected orders on pallets to eliminate the use of trolleys
  • Adjusted dock heights to comply with inbound and outbound trucks
  • Flow-through process for 13 degrees Celsius fruits and vegetables
  • Receipt of supplier goods on pallets to reduce the number of required truck doors
  • Slotted the products for increased picking efficiency
  • Restructured process flows in the General Merchandise area
  • Introduced double-deep reach trucks and double pallet jacks to improve labor productivity
  • Conducted order selector training and productivity monitoring

Benefits

  • Improved storage capacity using double deep racking and the full building height of the existing distribution center enabling the consolidation of all three facilities into a single distribution center
  • A planned 2,000 square meter facility expansion was canceled resulting in a capital investment avoidance of $1,000,000 U.S.
  • By receiving goods on pallets, a projected purchase of 30 truck doors was canceled resulting in a capital investment avoidance of $500,000 U.S.
  • A manpower saving of $200,000 U.S./year was achieved by using pallets for shipping to the stores rather than using trolleys

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A full line self-distributing grocery retailer serving over 150 company-owned stores.

Scope of KOM International's Mandate

The client's dry grocery distribution center needed to be reconfigured to handle increased growth in product variety, throughput volumes and inventory levels. KOM International was hired to perform a study of the dry grocery operation to recommend the most suitable distribution layout and operating method changes.

Critical Issues

  • Shortage of storage capacity for products, throughput volumes and inventory
  • Labor productivity
  • Long truck loading times
  • Transportation inefficiency

Objectives

  • Reset the grocery distribution center
  • Improve operating procedures at distribution
  • Reduce transportation operating costs
  • Provide stores with improved store-friendly pallets

KOM International's Recommendations

  • Improved inventory turns through changes to the existing purchasing software system
  • Recommended the selection/implementation of a warehouse management system
  • Implemented new slotting of all grocery products to improve picking efficiency
  • Implemented a new facility configuration to handle new items and more storage capacity
  • Changed order picking process from tuggers to double pallet jacks in a cross-aisle picking pattern to improve picking productivity
  • Implemented a new plastic pallet system to reduce pallet repair costs.
  • Implemented an automatic battery charging/mechanical changing system
  • Changed overall delivery system improving driver and store unloading and stocking productivity.

Benefits

  • Existing storage capacity was increased by 14% and capacity to handle new items increased by 26%
  • Warehouse productivity increase of 17% through reduced travel time and improved pallet building
  • Increased delivery frequencies provided for significant retail store back-room inventory reduction
  • Improved store service levels through store-friendly pallets by family grouping and reduced top-loading
  • Pallet repair costs were reduced by 70%

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A grocery distributor servicing retail and wholesale accounts across Canada.

Scope of KOM International's Mandate

The client's infrastructure was comprised of five distinct operating divisions with eighteen distribution facilities delivering to customers in overlapping service areas. Due to rapid growth through acquisition, the client recognized that significant changes to its distribution infrastructure were required to remain competitive. Working with the client's national logistics team, KOM International developed an optimal national distribution network strategy to improve the company's competitive position in the Canadian market.

Critical Issues

  • Ineffective distribution network requiring a more customer-centric approach
  • Customer service

Objectives

  • Optimize the firm's supply chain
  • Reduce inventory levels
  • Improve efficiency to reduce operating costs

KOM International's Recommendations

  • Matched customers to most cost-effective distribution center regardless of operating division
  • Centralized Perishables operations for receipt and handling to reduce costs and increase quality control
  • Introduced Fast/Slow distribution networks where applicable
  • Improved warehouse layouts and standardized warehouse operations to match productivity levels of the client's top performing warehouses
  • Implemented combo-loading (i.e. multiple temperature products on the same refrigerated trailer) to increase trailer utilization and to reduce delivery frequency without sacrificing service levels or product quality
  • Introduced cross docking for Direct Store Delivery items

Benefits

  • 18 distribution centers reduced to 11
  • 32% Reduction in the distribution operations cost per case broken down as follows:
    • Reduced transportation costs 32%
    • Reduced Warehouse Storage and Handling Costs 47%
    • Reduced Space Requirement 14%
    • Reduced Inventory Levels 7%
    • Total 100%
  • KOM's recommendations for distribution network improvements are currently at various stages of implementation and additional

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A foodservice distributor with distribution facilities in over 10 locations across the United States servicing Dry Grocery, Perishables and Frozen Food product lines to restaurant chains, grocery chains, and institutional clients.

Scope of KOM International's Mandate

The client required increased throughput capacity to handle business growth as well as overall labor productivity improvements in its existing distribution facilities. KOM International conducted an audit of each distribution center to assess its strategic location, operating methods, computer systems, building value, equipment value, and growth potential.

Critical Issues

  • Shortage of storage capacity
  • Distribution efficiency

Objectives

  • Optimize the firm's supply chain
  • Implement quick changes to improve efficiency

KOM International's Recommendations

  • KOM International designed and implemented new facilities in two locations, as well as the expansion of and reset in a third
  • Defined equipment specifications and quantities and solicited bids for all material handling equipment, including:
    • Pallet racking (including special ergonomic beams at floor level)
    • Push-back racking
    • Single and double pallet jacks
    • Reach trucks and counterbalance lift trucks
    • Labeling
  • Assisted in the selection and installation of the material handling equipment, as well as dock equipment
  • Slotting of each item to a new pick location
  • Move planning and changeover support
  • Creation of data files to seed the warehouse management system

Benefits

  • Reduced distribution costs by centralizing operations
  • Successful implementation of two new distribution centers and one expanded facility within a ten-month period from study/design to completion of implementation
  • Increased capacity and slots to handle new business
  • Improved ergonomics by using special beam for heavy products

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A large bakery products distributor located in the U.S. Midwest, servicing in-store and independent bakeries.

Scope of KOM International's Mandate

The client required increased throughput capacity. KOM International redesigned the existing facility's storage methods and picking systems resulting in increased storage capacity and overall labor productivity improvements.

Critical Issues

  • Shortage of storage capacity
  • Distribution efficiency

Objectives

  • Improve operational layout and procedural flows

KOM International's Recommendations

  • Elimination of outside storage
  • Introduced double-deep racks for bulk storage and order selection
  • Introduced case flow racks and shelving units for slow moving items
  • Introduced batch picking of multiple orders in one trip through the aisles to reduce operator travel time
  • Optimized the picking sequence to improve pallet stability during transit
  • Renumbering of aisles to force Z-pick travel thereby eliminating two-way travel in pick aisles
  • Increased dock areas to improve staging and loading operations
  • Immediate dock loading of picked orders

Benefits

  • Increased storage capacity of existing building by 38% without any construction
  • Doubled the number of operating aisles creating more pick faces and reducing aisle congestion
  • Labor productivity improved by 48%

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

An U.S. subsidiary of a multinational food manufacturer and distributor requires more freezer storage capacity to store raw materials and finished goods.

Scope of KOM International's Mandate

The client's distribution facilities required expansion and inventory accuracy and date rotation required significant improvements. KOM International was commissioned to evaluate alternative materials handling systems, to design and implement a new facility expansion and to select/implement a new warehouse management system.

Critical Issues

  • Shortage of storage capacity
  • Inventory accuracy and rotation

Objectives

  • Expand frozen food facility
  • Select and implement a WMS with RF / bar coding technology

KOM International's Recommendations

  • A new 24,000 square feet distribution facility expansion with a height of 40 feet was designed and implemented
  • Changed orientation of building site to improve truck access
  • Compared two options - double-deep and four-deep pushback racks
  • Based on the cost of equipment and building, double-deep racking was selected
  • Selection and implementation of a new warehouse management system
  • Implementation of new putaway and picking processes

Benefits

  • 36% sales increase with no increase in warehouse labor expense
  • Optimal use of existing site

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

The South American division of a multinational manufacturer and distributor of food products.

Scope of KOM International's Mandate

The client was experiencing high growth rates and needed to increase overall distribution capacity to handle increased throughput volumes. KOM International designed and implemented an expansion to the firm's finished goods storage facilities for their Vegetable Oil and Oil Seed processing plant.

Critical Issues

  • New storage space required to handle increased storage and throughput

Objectives

  • Expand facility layout and reduce warehouse expenses to enable business growth

KOM International's Recommendations

  • Relocation of the production area to a lower space that would provide improved flow from raw materials to production
  • Introduction of pallets to facilitate handling and to reduce transportation costs
  • Automatic palletizers at the end of production lines
  • Reuse of the existing racking in a more efficient layout configuration
  • Construction of a new dock level with truck heights to enable the use of pallet jacks for the loading/unloading process thereby eliminating manual procedures.
  • Drive-in racks for the storage of fast moving products and single/double-deep racks for slow moving products
  • Site planning - reoriented building on their existing site.

Benefits

  • By increasing existing space and storage equipment, throughput capacity was increased by 41% from 2,900 to 4,100 pallets/day
  • An increase of 80% in warehouse labor productivity due to improved operating procedures
  • By reusing existing racks, no additional capital expenditure in racks was necessary
  • By replacing 2 lift trucks with 2 pallet jacks, a capital savings in equipment was achieved, as well as a reduction in maintenance costs

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A manufacturer/distributor of frozen products servicing retail outlets across the U.S. Midwest with ice cream and sundries product lines.

Scope of KOM International's Mandate

The client's freezer distribution facilities required expansion and a reset to increase flexibility, productivity and loading times. KOM International was commissioned to evaluate alternative materials handling systems, and to design and implement a new facility expansion.

Critical Issues

  • Shortage of storage capacity
  • Labor productivity
  • Long dock loading times

Objectives

  • Expand frozen food facility
  • Select and implement a WMS with RF / bar coding technology

KOM International's Recommendations

  • A new 40-foot clear stacking height freezer expansion was designed and implemented.
  • A mechanized pick-to-belt system was replaced with a conventional pick-to-pallet system to increase flexibility
  • Mix of single and double deep racks
  • Designed a custom plastic pallet to fit in the Frozen trailers
  • Reorganized product sequencing to build better quality pallet loads
  • Changed pallet heights to increase storage capacity
  • Introduced double pallet jacks to pick two orders in one trip

Benefits

  • Facility expansion increased storage capacity by over 2,000 pallets
  • Maximized storage capacity utilization of existing site
  • 15% increase in warehouse labor productivity
  • With the addition of three new truck doors, the overall shipping and receiving capacity increased by 50%
  • Loading speeds increased by enabling the concurrent loading of multiple trucks

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

An operating division of a multinational manufacturer and distributor of food products located in the Southeast United States.

Scope of KOM International's Mandate

The client's vegetable oil and oil seed processing plant required more storage capacity for finished. KOM International designed and implemented a facility expansion to accommodate projected sales growth.

Critical Issues

  • Shortage of storage capacity for finished goods

    Objectives

  • Expand the warehouse facility attached to the firm's processing plant
  • Improve labor productivity

KOM International's Recommendations

  • Introduced new building footprint and clear stacking height
  • Implemented 4-deep pushback racks
  • Justified implementation of a warehouse management system
  • Defined criteria for the selection of a new warehouse management system
  • Defined operating procedures for new building, including lot tracking and use of RF devices
  • Analysis of effect of inventory levels on building size

Benefits

  • 80% increase in warehouse labor productivity
  • Optimal use of existing site
  • Increased storage capacity

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A multinational manufacturer of lighting products.

Scope of KOM International's Mandate

The client operated a distribution network of 7 manufacturing plants and 5 full-line distribution centers and with smaller regional storage warehouses across North America. KOM International was mandated to perform a strategic supply chain study of the client's distribution network to optimize service levels and the logistics costs.

Critical Issues

  • 7 manufacturing plants
  • 5 full-line distribution centers
  • High distribution costs
  • High inventory assets / low turns
  • Low service level
  • Low customer satisfaction level (fill rate, lead-time, damage and errors)
  • 60% back orders

    Objectives

  • To increase customer service level to 95%
  • Reduce total supply chain costs by 1.5%
  • Increase total quality of customer service
  • Reduce order handling costs
  • Reduce product damage from the current 2.6% by at least 20%
  • Significantly reduce back orders

KOM International's Recommendations

  • 5 regional distribution centers stocking fast-moving products
  • Centralized national distribution center stocking slow-moving products
  • Market-driven pull system
  • Combination of cross docking of slow movers through regional distribution centers and direct shipments from manufacturing plant to customer
  • Service level objectives stratified by A/B/C customers prioritization

Benefits

  • Significant reductions in distribution expenses
  • Significant reduction in inventory assets
  • Back orders were reduced as a result of major improvements in order fill rates
  • Customer service levels exceed 95%
  • Order turnaround time (i.e. lead time) dropped from 15 days to 2 days for fast movers representing 80% of sales revenue.

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A Canadian metals manufacturer/distributor producing 225,000 tons/year of different products (approximately 65 SKUs) with projected growth rates of 50% per annum over the next 3 to 5 years.

Scope of KOM International's Mandate

The client was experiencing rapid growth rates and needed to handle increased throughput by improving an inefficient warehouse/ plant layout with poor storage capacity utilization and low productivity levels. KOM International was mandated to improve the facility layout, improve operating procedures and introduce new technologies to improve overall efficiency.

Critical Issues

  • New storage space required for production line expansion
  • Existing storage layout was inefficient
  • Lengthy order selection process (re- handling, memory-based processes, etc.)
  • Lack of dock space resulting in congestion
  • Lengthy loading time (up to 4 hours/trailer mainly to secure the load)

    Objectives

  • Improve facility layout and reduce warehouse expenses to enable business growth

KOM International's Recommendations

  • Reset of distribution / plant layout to open the dock and increase storage capacity
  • Tested, selected and implemented new inventory control and bar coding systems

Benefits

  • Increased plant storage capacity by 15% without any expansion
  • Significantly improved productivity and efficiency of distribution operations (order picking, dock activity, product flow, etc.)
  • Enabled real-time inventory control and significantly improved inventory accuracy

The following case study does not include company names or locations to protect the anonymity of our clients. For further information, please contact KOM International.

Client / Industry

A North American manufacturer and distributor of pet supplies with operating divisions in every continent around the world.

Scope of KOM International's Mandate

The client operated multiple distribution centers in one North American city and additional warehousing facilities in another city. The multiple facilities were consolidated into a single 166,000 square foot distribution center designed and implemented by KOM International.

Critical Issues

  • Inventory held in multiple distribution centers and storage warehouses
  • High distribution costs
  • High inventory assets / low turns
  • Service levels below objectives

    Objectives

  • Reduce warehouse operations expenses
  • Improve order fill rates and turnaround times

KOM International's Recommendations

  • Slow moving split case items stored in shelving units
  • Medium velocity split case products picked from 5 horizontal carrousel workstations consisting of 4 carrousels per station
  • Fast moving full case items stored and picked from single and double deep racks
  • Conveyor system with automated sortation by customer shipment for all merchandise picked from the carrousels
  • Implementation of batch picking for small orders
  • Selection of a new warehouse management system to improve labor productivity and inventory accuracy
  • Introduction of radio frequency and bar coding technologies for all warehouse functions

Benefits

  • Significant reductions in warehouse operating expenses
  • Significant reduction in inventory assets
  • Back orders were reduced as a result of major improvements in order fill rates
  • Distribution center storage capacity was increased by 30%
  • Split case order picking rates from the carrousels improved by 500% to 200 order lines/hour (rate includes replenishment labor)
  • Full case order picking productivity increased by 25%
  • Mobile equipment reduction as very narrow aisle cherry-picker trucks were replaced with double deep reach lift trucks

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