Distribution network optimization:Heineken Mexico

Abstract

This report gives an overview of a project conducted at Heineken. The overall project objective is to determine the long term distribution that minimizes operational expenses, given the required level of service. The model reflects distribution network with its four areas: primary warehousing, primary transport, secondary warehousing and secondary transport. After the model is developed different scenarios are introduced and tested in order to decrease the total costs. Different opportunities are tested in scenarios, better customer allocation, increase of warehouse space, improvement of efficiencies and productivities in different areas of the network. Analysis of scenarios provided insights in behavior and sensitivity of the network to different limitations and changes but also gave clear directions how to optimize distribution in a long term. The Greenfield scenario showed that savings of 12% are possible