A NEW STRATEGY TO IMPROVE SUPPLY CHAIN EFFICIENCY
Duke&Kay was involved in a challenging project in a family-owned Italian Group in the consumer goods sector. After the acquisition of a Spanish company from an American private equity fund the Group reached in 2019 a turnover of 700mil. € thanks to a complementary product catalogue covering an international presence on the global market.
But afterwards, the Italian Multinational has suffered poor performances in 2020, not only due to the Covid crisis, but also because of the execution of wrong strategic choices. In fact, they have lost a significant partner (a US manufacturer) that was exclusively distributed in Europe (accounting for one third of their European sales). Additionally, they refused to sell through Amazon, relying purely on their own websites, missing the e-commerce growth in 2020. In summary the company suffered a sharp decline in sales and this caused major losses to the Group P/L.
Meanwhile, the Spanish acquired company maintained its EBITDA level in 2020 despite lower sales thanks to a successfully growth in the e-commerce business, thanks to Amazon partnership in particular.
At the beginning of 2021, decision was taken by the owner to appoint a Spanish governance of the Group with the aim of improving Operations profitability. As part of the Operations reorganization process Duke&Kay was asked to identify an Executive in charge for the implementation of a new global supply chain strategy.
A Duke&Kay Supply Chain Director started to:
- Take over immediately the management of the Supply Chain teams in all countries and work with them to deliver current business objectives
- Review all processes and costs in order to optimize them
- Challenge all logistics service provider to negotiate their costs and processes
- Rethink the Supply Chain strategy and propose a new scheme and footprint
- Implement the action plan with the team
The 8 months mission was really successful improving supply chain efficiency, reducing logistics costs and supporting future sales strategy. All the indexes applied to monitor the performances have been reached and most of them exceeded the expectations.