Snack manufacturer increases EBITDA by more than 5% in year one

The Challenge

A leading private label snack manufacturer, with an annual revenue of over $1 billion that services over 12,000 customer locations across the U.S., Canada, Europe and Asia, needed to optimize its production network to better meet growing demand. It operates 11 plants across the U.S. and Canada, nine of which were acquired over the past decade, creating redundancies in its manufacturing network. The business needed help reconfiguring its production to determine which products to make at each plant, which customers to serve from each facility, and where to add new plants. 

Rapid growth also led to inconsistent product nomenclature across the organization. To analyze and optimize the supply chain effectively, the company first needed to implement universal product identifiers in its ERP system. 

The Solution

With the snack manufacturer already having access to shelfware from Blue Yonder, Highspring recommended using Blue Yonders’s Supply Chain Strategist (SCS) tool to determine the best approach to reconfiguring its manufacturing network. Drawing on years of experience with SCS, Highspring provided training to the business’s supply chain team, including an introduction to SCS and sessions covering all its features and capabilities. Highspring helped design and build their model, then worked with the team to analyze and interpret the model’s results. Because the source data used to build the model can often have data issues or incomplete supply chain information, Highspring provided its Root Cause Analysis tool to help identify and resolve any identified issues during the model build. 

Our Impact

As a result of the partnership, the client reduced costs by $5 million in the first year and is expected to realize $18–$20 million in cost reduction over the next two years. In addition to cost savings, the company had an opportunity to acquire a new plant but faced a limited decision window. A key factor in moving forward was the analysis performed in the newly integrated SCS tool, which showed the acquisition would be profitable by lowering costs across the supply chain. The client also determined the most optimal location for their next plant and used Highspring’s Root Cause Analysis tool to identify and resolve issues encountered during the model-building process.