DC placement decisions and mode selection strategies are revisited every 3-5 years in formal network studies, but the competitive and cost landscape shifts continuously. Most organizations lack the analytical infrastructure to evaluate cost-to-serve by lane and customer segment, leaving them unable to determine whether adding a DC, shifting volume to intermodal, or renegotiating FTL contracts would generate the most meaningful reduction in total delivered cost per unit.
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VP of Supply Chain Strategy evaluating a 3-DC consolidation vs 5-DC regional expansion decision for a $2B omnichannel retailer
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Network Design Analyst
Models DC placement scenarios, cost-to-serve by segment, and mode selection tradeoffs across the distribution network.
Transportation Analyst
Evaluates lane-level mode selection between LTL, FTL, and intermodal based on transit time, cost, and volume thresholds.
Operations Planner
Assesses operational feasibility of network restructuring scenarios, including DC staffing ramp-up and throughput capacity constraints.
Network optimization modeling that evaluates DC placement scenarios, LTL vs FTL vs intermodal mode tradeoffs, and cost-to-serve by customer segment to identify the highest-impact network restructuring moves.
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Consolidating to 3 DCs lowers total delivered cost about 8% (roughly $14M a year) by collapsing fixed facility and labor overhead, but average transit time rises from 1.8 to 2.6 days and SLA attainment on your premium segment drops from 96% to about 91%. The swing factor is the West region, which loses next-day coverage. Keeping the Reno DC and consolidating only the three eastern sites captures most of the savings while protecting the premium-segment SLA.