Quantzig’s Inventory Optimization Helps a Wholesale Food Distributor to Increase Profit Margins by 35%

Jun 15, 2018

What the Client Wanted

Efficiently track inventory levels with improved visibility into the incoming and outbound deliveries.

The Outcome

Simplified the end-to-end tracking of the products from order to delivery.

Summary of the Wholesale Food Distribution Industry

The global wholesale food distribution industry comprises over 35,000 establishments that aim at distributing food and related products on a wholesale basis. The industry is witnessing promising growth, characterized by the rising global population and the growing demand for food due to the rising disposable income. The growth of the wholesale food distribution space can also be attributed to the four I-engines; including internationalization, integration, innovation, and implication.

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Industry Challenges

Increasing labor and transportation costs: The recent economic slowdown has greatly affected the transportation and labor space in terms of the fluctuations in fuel prices. As a result, organizations in the wholesale food distribution space are facing relentless pressures to cope with increasing labor charges while maintaining consistency in the products being offered. Besides, organizations should also ensure the need to maintain compliance requirements with the utmost quality in the products. 

Increasing demand for organic products: In the wholesale food distribution space, the food products are sold on a wholesale basis, but when it comes to organic products, the shelf life of the products is affected. With the increasing demand for organic products, it becomes crucial for organizations to maintain better packaging techniques to retain the shelf life of organic products.

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About the Client

The client is a leading wholesale food distributor based out of India with over 100 business bases spread over 15 countries.

Client’s Challenge

The client was facing challenges in maximizing the ROI as the distribution and retail markets are volatile. Additionally, over 35% of their inventory was stuck in non-performing stock-keeping units, which contributed to less than 5% of their overall sales. As a result, the client wanted to devise effective strategies that would help them handle and better manage their inventory levels.

Summary of our Inventory Optimization Engagement

Request more information to know more about how our inventory optimization engagement helped the wholesale food distributor to gain insights into the latest food and beverage industry trends.

Business Impact

The inventory optimization solutions offered by Quantzig helped the wholesale food distributor to augment their inventory by supporting them in identifying and decommissioning the non-productive stock. The inventory optimization experts also helped the client develop business cases including the estimated savings associated with each opportunity. Additionally, implementing SKU rationalization techniques for inventory management helped the client increase their profit margins by 35%.

Inventory Optimization Solution Insights

Today, it is essential for wholesale food distributors to identify and devise effective strategies that help re-deploy unbalanced inventories. Adopting Quantzig’s inventory optimization solution brings about improvements in cost efficiency by maximizing profit margins. Inventory optimization coupled with predictive analytics capabilities can better manage logistics to gain in-depth insights into the supply chain network.

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