Distribution Center Farmasa-Schwabe Mxico
Relocation Project
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Objective
Determine the effectiveness and productivity of the Farmasa DCs Location and evaluate whether should relocate, and if so what would be the urgency of this relocation
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Content
Current Location Operational Challenges Density of Distribution Distribution Zone 2011 New Distribution Zone 2013
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Current Location
Tultitlan, State of Mxico
Condominium Don Francisco
Distance
35 km North of Bfalo Office 155 km North from Manufacturing Plant Xochitepec
Transit Time
1.5 hrs from Bfalo Office 3.0 hrs from Manufacturing Plant
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Current Warehouse
Current Warehouse
Current Location Warehouse A
Renting since Dec-03 Total Area, 913 m Warehousing Finished Goods COFEPRIS License GMP Compliance
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Current Location Warehouse H
Renting since Jul-09 Needed because K&N our 3PL closed down Total Area, 873 m Warehousing packing and promotional items Non GMP area
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Current Buildings Specifications
Business Condominium: Building Name: Total Leasable Area: Land Size: Roof System: Clear Height: Bay Size: Drive in doors: Locations: Construction Type: Dock Height: Slab Thickness: Number of Docks: Truck Court: Parking Spaces: Skylights Office Area 5.4 m - 7.00 m 8 m x 16 m 0 733 Concrete Block 1.25 m 10 cm 1 per warehouse 15 m 4+4= 8 "A"-0% , "H"-10% 65+95= 160 m2 Don Francisco "A", "H" 1,786 m2 1,986 m2
Operational Challenges
Logistic Operation
120 m between warehouse Carrying materials from one to the other Additional time and labor intense Double positioning for loading and unloading
H
Access A
120 m
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Operational Challenges
Warehouse
Structure
Irregular Shape Lower Ceilings Unusable space Double office space
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Operational Challenges
Dock Area Layout
Small receiving/shipping area High risk of mixing In (quarantine) and Out (approved) product
Actual Dock Layout
In
Out
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
Operational Challenges
Dock Area Layout
Small receiving/shipping area High risk of mixing In (quarantine) and Out (approved) product
Flooding Issues
Distribution Density
by Zones (Nov 2011)
Zone One 42% Zone Two 28% Zone Three 17% Zone Four 13%
17%
42% 28%
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
13%
14
Metropolitan Area
new zones (April 2013)
Zone 3
Zone 1 39% Zone 2 30%
Zone 1
Zone 3 17%
Zone 4 14%
Zone 2
Zone 4
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
15
Metropolitan Area
new zones (April 2013)
Marzam opens a DC in Ecatepec and closes down two centers Farmacos Especializados moves to north (Naucalpan) Nadro opens DC in Cuautitln Saba stills in Vallejo and Taxquea
Zone 1
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
16
Why Is Everybody Moving North
Building The Northern Industrial Corridor The conditions and structure are serving for industries seeking this northern area. There are many new developments in communication channels including good roads and highways that are facilitating and forming industrial parks and therefore transportation and logistic accommodations are giving in this area.
Francisco Genoves Distribution Center Manager and Oskar MunguiaSupply Chain Director
17
DCs Operational Challenges Summary
Leasing agreement expires on December 2013 Enough meters but in two separate buildings 120 meter between buildings Just one of the two building is GMP compliant None of these is fully in compliance with GWPs Lower ceilings cannot control temperature Roof leaks in building H a no isolation Dock layout inefficient (hectic) Small shipping/receiving area Flooding issues in this area Sanitary concerns Product losses
Relocate is better option
Because of all the operational challenges decided to relocate Associated with real state agent (tenant representative) Conducted a market research Evaluating new leasing agreement as an option Looking for a World Class (A+) warehouse Finding investor willing to build
Defining Needs and Specifications
Locations (space) requirements
Number of pallets according to desire inventory levels Including potential growth for the next ten years Results: about 900 locations 1,200 mts of location space, 200 shunting and 150 office space
Product Line Farmasa-Schwabe LeoPharma (3PL) Returns Quarantine Packaging Materials SNA Promotional Items Medical Samples Totals Full Pallets 183 19 36 108 95 20 100 80 641 Partial Total # of Pallets Pallets 47 8 0 0 0 0 0 0 55 230 27 36 108 95 20 100 80 696 Potential Growth (5 years) 265 30 40 119 114 23 101 88 779 Potential Growth (10 years) 304 33 44 131 137 26 102 97 873
Business Condominium: Building Name: Total Leasable Area: Land Size: Roof System: Clear Height: Bay Size: Drive in doors: Locations: Construction Type: Dock Height: Slab Thickness: Number of Docks: Truck Court: Parking Spaces: Skylights Office Area
Don Francisco "A", "H" 1,500 m2 1,800 m2 10 m-12 m 8 m x 16 m 1 900 Concrete Block 1.25 m 15 cm 2 15 m 8 "A"-0% , "H"-10% 150 m2
Racks
THANK YOU ! ! !
