CIBER Identifies Supply Chain Cost Savings Opportunities for Largest New York Wine and Spirits Distributor

13/09/07 CIBER, Inc. was selected by Brooklyn-based Empire Merchants LLC -- the largest wine and spirits distributor in metropolitan New York -- to lead a supply chain cost reduction initiative for the firm's two New York metro area distribution centers. CIBER conducted a Logistics Improvement Analysis (LIA) to define requirements and evaluate software and hardware vendors. CIBER also built a "roadmap" to identify specific steps Empire would need to take to achieve its supply chain goals.

Empire Merchants LLC was created in February 2007 through the consolidation of two New York area wine and spirits distributors -- Peerless Importers and Charmer Industries. It currently operates two facilities in Brooklyn and Astoria as a result of the business combination. The order volume and product inventory almost doubled when the companies combined, and this originally did warrant the storage space of the two facilities. However, Empire found that the costs of shipping from both facilities was not economical.

During its initial analysis, CIBER determined that Empire Merchants could reduce overall costs and make the most efficient use of its warehouse space and transportation capabilities by consolidating all shipping operations into one facility, and using the other facility for bulk storage of certain products.

As part of its analysis, CIBER conducted an LIA to identify opportunities for performance improvement, to ascertain specific cost reductions, and to determine key performance indicators to use to measure progress.

CIBER then worked with Empire's project team to identify and document solution requirements, including maximization of current warehouse square footage, while providing the ability to create and process inter-facility transfers efficiently.

Based on the depth of CIBER's analysis, Empire asked CIBER to take on their next project -- assisting in evaluating and selecting software for a warehouse management system. CIBER began by helping Empire generate an RFP. Once RFP responses were received from the vendors, CIBER and Empire formally and critically evaluated each vendor to identify the best functional system to meet Empire's supply chain needs.

Empire asked CIBER to continue with the final project -- implementation and integration of the warehouse management system -- which is currently underway. CIBER is designing and building a custom inter-facility transfer application, as well as leading the implementation and integration of a warehouse management system.

"Because of their experience in our industry, CIBER already had a deep understanding of our business, but they were also quick to learn the uniqueness of our situation," said Anthony Magliocco, Empire Merchants' Chief Operating Officer. "During the software selection process, CIBER's demonstrated knowledge of the wine and spirits industry and supply chain software market assured us that CIBER was the right partner to lead the implementation as well."

At project completion, all of Empire's distribution center data will be on one system, so the firm can efficiently ship consolidated orders from one warehouse. The cost savings are expected to be significant, helping Empire Merchants maintain its competitiveness and leadership role in the industry.

"The cost benefits of having one system that meets our specific needs are considerable," said Terry Arlotta, Empire Merchants' Chief Financial Officer. "We can maximize our value to our customers by sending them one shipment instead of two. In addition, having accurate yet lower inventory levels will enable us to make the best use of our space in our current facilities. We're eager to realize all of the benefits the new solution offers."

"We have been very impressed with Empire Merchants' business success, and we are pleased they have chosen us for this important initiative," said Patrick Verheijen, Vice President of CIBER's Supply Chain Practice. "We have assisted numerous wine and spirits distributors and other food and beverage companies with their supply chain improvements and cost-saving designs. Empire Merchants and CIBER have formed a strong partnership, and we will measure our success by their success."