A French company, world leader in microbiological testing solutions for medical and industrial applications, wanted to implement a new «Hub and Spoke» supply chain model.
Their objective was to refocus their operations on 3 distribution centers, spread across the United States – in the West Coast, MidWest, and Northeast.
This would enable them to strengthen their distribution model, increase their proximity with customers, while reducing transportation costs and carbon footprint.
Supporting a Global Pharmaceutical US Supply Chain transformation
This multi-billion-dollar company is present worldwide and serves more than 160 countries through a large network of distributors. To streamline its operations and deliver customers based on its geographical position, this global leader in the pharmaceutical industry decided to move from three warehouses, each specialized in a specific product, to three distribution centers located across the United States and all managed by UPS.
The deployment of this new supply chain model involved a new demand and planning model and a full interfaces core model deployment (inbound & outbound flows, vendor, material & batch master data, material movements…). One key challenge is that the company interfaced its SAP systems with UPS (warehouse) & FedEx (main carrier), while UPS was deploying a new WMS system in the US for its healthcare activities.
This project was especially strategic because the company – present in America for 30 years – generates 40% of its global sales in the United States.
Moreover, the U.S. supply chain accounts for approximately 50% of total deliveries. To avoid impacting operations, the closure of existing warehouses had to coincide with the opening and start-up of new ones.
A multicultural project, in two countries with 2 companies
The company is a long-time TeamWork customer. With half of the client’s teams located in France and the other half in the United States, the 6–9-hour time difference made collaboration challenging. A few years ago, this client acquired an American diagnostics company with which TeamWork was also to work on this project. To help the client, at the end of 2021, TeamWork set up a full-time IT project manager, based on the West Coast, experienced in supply chain projects and an expert on SAP. Acting as a link between the two countries, with the new company and with UPS, he brought his expertise in logistics, transport, and order entry processes. A developer was also available (based in the US on the East Coast) from time to time, as well as a functional consultant (Business Analyst) based in France.
At the end of 2021, the TeamWork project manager took charge of all the steps, from preparation to production. He was involved in the design, build and testing phases. Interfaces were created to ensure integration between the client’s SAP ECC/ APO and UPS’s 3PL/Carrier systems. UPS being a large company, the presence of the TeamWork team in the United States was crucial in optimizing collaboration and resolving problems.
1 fully operational distribution site and 2 openings in 2024
The initial IT schedule and deadlines were met, with positive feedback from the customer and users. The client’s first warehouse on the West Coast opened in April 2023 and will serve customers and subsidiaries in the APAC and ASEAN regions.
The second warehouse, located in the Midwest, is the only one retained from the previous facilities and will be optimized to distribute the company’s full range of reagents in the future. The final distribution site, located in the Northeast, is set to launch in early 2024 and will serve customers on the East Coast, as well as in India, Canada, LATAM, and France.
