EOQ & Route to Market strategy – MediaMarktSaturn (MMS)

 Overview

Company Description

European Electrical retailer

Project Description

MediaMarkt is centralizing its Supply Chain and has built a central warehouse in Etten-Leur which is the heart of the operation. MediaMarkt uses 2 different route-to-market strategies to deliver products to our sales channels, and a third that is in development:
1. Bulk: Stock received is put into storage, outbound orders are picked from storage
2. BBXD: Break Bulk Cross Dock – stock that is processed within 72H for delivery to store
3. PAXD: Pre-Allocated Cross Dock – stock that is delivered already sorted per store.
To improve efficiency & costs of the ordering and delivering processes, we would like to determine & implement the Economic Order Quantity (EOQ) per product category & re-evaluate our route-to-market for our suppliers.
We want to investigate by how much the operating cost can be reduced, while targeted service levels are met without targeted stock increase, which criteria should be leading, suppliers/ groups that qualify, and the implications (cost vs. savings) of switching multiple suppliers/groups. The solution should take business requirements into consideration, such as promotional & seasonal influences, system constraints, supplier reliability and agreed service levels.

Goals of the Project

Determine and implement EOQ per product category & define the most efficient route to market strategy per product group/supplier to improve supply chain cost whilst maintaining product availability and not exceeding stock targets.

Deliverables

• Activity based costing on current Supply Chain
• Definition of an EOQ that works in practice
• Insight in development of KPI’s by implementation
• Develop the optimal / improved goods flow settings
• Determine the potential savings
• Provide a roadmap how to come to this optimum
• Provide an instruction / tool to maintain the optimal route to market strategy

Essential Student Knowledge

Inventory Planning knowledge

Ability to handle large dataset

More information: escf@tue.nl