How network modelling supports Supply Chain Design decisions · How network modelling supports Supply Chain Design decisions Nissan Case Study Nick Jordaan DSV Supply Chain Innovation,

How network modelling supports Supply Chain Design decisions

Nissan Case Study

Nick JordaanDSV Supply Chain Innovation,

Supply Chain Advisor, Sub-Saharan Africa

Flip EngelbrechtNissan SA, Senior Manager of Procurement,

Inventory and Systems

NISSAN GROUP

OF AFRICA

1

123 Dealers throughout SAF

42 NSC in SSA Market

22 000 m³ of Warehouse Space

41 000 Active SKU

Nissan SA Aftermarket Network Study

Network Modelling

Approach

Customers Need

Strategy Alignment

Scenario Selection

Data Analytics

Selecting software

Run the “What If” Scenarios

Analyze Results

Implement

Need for Network Design and Optimization

WHY DO COMPANIES DO NETWORK DESIGN AND OPTIMIZATION STUDIES?

576337

Nissan’s Need for Network Study

GLOBAL COMPETITION FUTURE GROWTH

NEW STRATEGY REDUCE COST

Customers Need

StrategyStrategy

Alignment

Typical Aftermarket Network Variations in SAScenario Selection

With Main DC

• Cost effective

• Long lead times

Normal DC with Regional DC(s)

• Close to market

• High warehouse cost

National DC with Super / Wholesaler Dealer

• Stock close to end user

• Loss of control

Cross Dock with Inventory at Dealer

• Quick to Dealer

• High redistribution cost

Sourcing

SOURCE : INBOUND FLOW

Local vs International

Air vs Ocean

Port of Entry FCL vs LCL

Scenario Selection

Delivery Requirements

( SLA)

Routing

Road vs Air vs Ocean

Exports

OUTBOUND LOGISTICS

DELIVER : OUTBOUND LOGISTICS

Scenario Selection

Costs

Locations

Local and

International

Number

of DCs

Inventory

Racking

MHE

Warehouse

Layout

Process Flows

Value Add

Services

Outsource vs Insource

Warehouse

SizeStrategic Tactical

Operational

Product Group Level

Data Analytics

SKU Level

Current Sales Future Sales

41K SKU 47K SKU

New Vehicles

Old Vehicles

Life time Buy

Normal Growth

Modelling Outcome

Data AnalyticsImportance of Forecasting – Sustainable Solution

Modelling in 3PL Environment in SASelecting Software

Air & Sea Solutions DistributionIO

Port of Entry Warehouse Size Safety StockNumber of Vehicles

/ Routing

Network OptimizationTransport

Optimization

Various Systems and Inputs

Outsource vs Insource vs Hybrid

Nissan Scenarios

12

1 2

3 4

Run the “What if” Scenarios

Network Flow per Scenario for NissanAnalyze Results

1 DC

Rosslyn, GP

2 DC

Midrand, GP

Berea, KZN

3 DC

Berea, KZN

Kuilsriver, WC

Meadowview, GP

SSA RDC

Alberton, GP

Scenario Results…

14

Analyse Results

Cost Availability

Compared to Baseline 1 DC (Future)

Year 1 DC 2 DC 3 DC1 PDC

Africa 2 RDC

Total Supply Chain Cost - 1% 2% 3%

% Demand Serviced Same Day - 11% 20% 1%

Executive Supply Chain Decisions

• Where in my supply chain network can I optimize for savings?

• Does my network have optimal Fleet?

• Do I outsource or insource operations?

• What is my most profitable market?

• What is the optimal location to open a New DC?

• Is my stock holding accurate to serve demand?

• What is my optimal number of DC’s and size for 2025?

• Does my network design fit the Business Strategy?

Conclusion

Align business

strategies

Best practice

approach Continuously

evaluate network

Determine the

Need

Questions & Answers