Supply chain mapping analysis provides data to support a new production facility

Client background:

A multi-billion dollar, U.S.-based, food and beverage organization with a multi-tiered supply chain serving mostly B2B customers.

Client business challenge:

Our client was working to meet the new product volume needs of a strategic partner, which required the construction of a new production facility. The organization needed to isolate the actual cost impact to their system-wide manufacturing network to determine how, where and when to meet their customers’ needs.

The Baker Tilly approach:

Baker Tilly performed detailed supply chain mapping and analysis to better understand the client’s cost drivers by collating data of all significant material movements throughout the client’s operating system, including the development of a dynamic scenarios-based analysis tool. To establish a holistic understanding of operating costs for a given scenario, the resulting cost drivers were then applied to a new co-plant and location and combined with detailed water, waste water, electricity and natural gas utility information, as well as state, local and federal tax credits/ impacts. Throughout the development process, our team worked side-by-side with the client’s engineering, finance and operating teams to define and measure critical drivers throughout the project’s evolution.

The Baker Tilly impact:

After many modeled reviews, we helped secure the site and supporting infrastructure agreements to construct the new Greenfield project at the defined costs. The new production facility substantially reduced the total supply chain costs by $5M+/year. These estimated savings, along with an additional $7M in state and federal tax credits and $10M+ in tax-exempt bonds secured by Baker Tilly, were used to offset the $50M project cost.

For more information on this topic or to learn how Baker Tilly specialists can help, contact our team.