Facilities Consolidation Project (Storage Design/Capacity Analysis)

National Retailer

Situation/Challenge: An auxiliary warehouse was leased to handle the increase of business for a large national retailer. The retailer’s main facility was located two miles from this satellite operation. After one-year of operation the facility was being sub utilized by over 40% and maintenance and operating expenses were $700k per year. Operating and maintenance cost needed to be reduced.

Actions: Performed a space/capacity analysis for both an auxiliary and the main facilities based on future business plans. Through this analysis, we recommended closing the auxiliary facility within a year and consolidating all processing and storage areas into the main facility.

The consolidation was done in two phases. The first phase consisted of the reduction of the auxiliary facility square footage by 35%. The second phase consisted of the consolidation of all remaining areas into the main facility. The entire project was organized into the five groups: Initiation, Planning, Execution, Control, and Closing of the consolidation process.

Result: The fulfillment operation saved over $1 Million in operating, leasing and consulting expenses within the first year of implementation.