Business Processes Streamlined and Warehouse Management Improved

Client: Loudon Bros. Ltd.

Loudon Bros. Ltd. was founded in the 1930’s. They have been operating in Ontario’s rural Thunder Bay area since 1985. Owned and operated by four family members, Loudon boasts over 100 years combined experience in the food distribution industry.

Since it was founded, the leaders at Loudon have fine tuned their business and mastered the craft of broadline food distribution. With over 30 employees and 29,000 square feet of warehouse space, Loudon has been a thriving confectionary, tobacco, and foodservice item distributor for over 60 years. Loudon Bros. has been a customer of Food Decision Software Inc. since 1997. They were the first customer to employ web order entry and they continue to be innovators in their industry as they increase their use of information technology to achieve supply chain efficiency.

Loudon’s rural northern location means that the business faces some unique geographical challenges that are not experienced by distributors located closer to urban city centres. The high cost of bringing product to their Thunder Bay distribution area means that elements of efficiency and accuracy are paramount to their success. The long distance and poor road conditions of Loudon Bros. and their customers create a supply chain with long lead times and little flexibility. While Loudon’s target is to provide next day delivery for all local customers, the 3 day lead time from their suppliers makes this a difficult feat for the distributor. Using demand forecasting features available in their WinFDS Software suite helps them resolve this issue by allowing them to predict their inventory needs based on demands from past years.

Loudon’s geographic location also presents issues when it comes to seasonal demands. This lightly populated area of Northern Ontario sees its population more than double in the summer months. This drastically affects buying patterns making it crucial for Loudon to accurately plan their orders and to maintain inventory levels. They use information from WinFDS to balance supply and demand. Loudon’s operating of extended supply chain differences and extreme seasonality leads to very high operational costs. For this distributor, supply chain efficiencies make the difference between profit and loss in the business. “You either get efficient or you go out of business” said Murray Gleeson, Director of Marketing and Finance at Loudon. Loudon increased supply chain efficiency by synchronizing their activities based on historical demand trends and cooperation with suppliers and customers. While these forecasts push them in the right direction, they have also undertaken projects to increase internal efficiencies in terms of warehouse operations.

Loudon undertook a warehouse revitalization project that included the implementation of the WinFDS warehouse management module. Since completing the project, Loudon has noticed a 300% productivity improvement in picking efficiencies. They have also improved warehouse space utilization, reduced dead stock, and improved inventory accuracy.

In addition to surmounting challenges presented by geography, Loudon has used technological capabilities to increase real time visibility. Through WinFDS features like web order entry, fill rate inquiries, and short shipment reports, Loudon has managed to improve customer service while increasing supply chain efficiency.  Loudon uses web order entry as well as off line laptop ordering and electronic data transfer to take the heat off the order desk and to connect buyers with fulfillment information in real time. These order processing features mean that more than 25% of their total numbers of orders enter the system untouched. Automating order processing has also reduced order lead time and allowed fill rates to improve.

For Loudon, supply chain efficiency is enabled by smart planning, accurate forecasting, and the technology that makes this possible. Their geographic location has presented some obstacles for the business, however, for 60 years Loudon has continued to overcome those challenges and have emerged today as a thought leader in the food distribution industry.

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