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Case Study: Coca-Cola Bottler’s Japan Inc (CCBJI)

“Our supply chain has become complex through restructuring and we want to consolidate and simplify.”

The Situation:

  • A major global beverage manufacturer and distributor
  • Multiple mergers over a short period of time had led to a complex supply chain
  • An ageing population in Japan was creating challenges
  • Increasing customer demands were impacting company margins

The Outcome:

  • Operating costs reduced by an estimated 12% through effective program management.
  • A safer and simpler network model
  • Plans in place to address the forecasted labour shortage in Japan through the introduction of Automation
  • An ongoing relationship with the client to manage the implementation of the program as well as lead the improvement of Distribution Centre and Transport operations.

The Client:

Coca-Cola Bottler’s Japan Inc (CCBJI) is the world’s third largest and Asia’s largest independent Bottler in the Coca-Cola network

The Situation:

The client sought our help with a number of challenges and we succeeded in finding effective warehouse solutions. After multiple mergers over a short period of time, they were left with a complex supply chain. They also needed to address the demographic challenges of an ageing population in Japan. Meanwhile, increasing customer demands were impacting company margins.

The Process:

To begin with, we conducted a situation analysis for the business, which identified core drivers of opex, capex, service and safety. We then determined approximately thirty potential network designs suitable for the client, for the purpose of completing a thorough quantitative analysis. Together with the client, we worked to determine the optimal network design based on detailed quantitative and qualitative modelling. From there, we were able to prepare the recommendation with supporting implementation plans and a business case for board submission, which was subsequently approved.

The strategy we designed consolidated many DC sites into fewer fit for purpose sites, lowering fixed costs as well as creating a critical mass to support the introduction of state of the art automation and robotics. We took advantage of available land at owned plant sites for the purpose of building fully automated Mega DC’s, which enabled the inventory model to transition from a three-echelon model to two echelons, rationalising transport lanes and reducing distance travelled, transitioning service nodes downstream from stocked locations to cross-docking sites and improving the use of expensive industrial property in Japan.

The Outcome:

CCBJI is forecasting its operating costs to reduce by an estimated 12% as a result of our work with them. Together, we put strategy solution plans in place to address the forecasted labour shortage and designed a safer and simpler network model. We forged an ongoing relationship with the client to manage the implementation of the program and see it through to success over the next three years. The client referred to the scale of the transformation as a “once in a generation opportunity for the company”.