Sponsor:

Leggett & Platt

Research Team:

Wooseung Jang, James S. Noble, Kristin Ehlers, Cerry Klein, Sean Carr

Universities Involved:

University of Missouri

Start Date:

06/01/07

End Date:

05/31/08

Summary:

This project analyzes current LTL network, redesigns logistics network, identifies cost savings, and develops practical implementation strategy for potential transportation cost savings
Leggett & Platt currently has approximately 220 branches in the USA (approximately 340 worldwide) that are served by both 9 LTL (less-than-truck-load) carriers at a cost of approximately $50M and 500 Leggett & Platt leased trailers. The annual freight flow for Leggett & Platt is approximately 220,000 LTL shipments and 140,000 TL (truck-load) shipments. Due to the complexity and extent of the logistics network there are several potential modifications that can be explored in order to reduce overall logistics costs, while both improving shipping visibility and customer service. The objective of this project is to develop and apply an approach to assess Leggett & Platt’s distribution network and operating practices. This analysis will be conducted with respect to maximizing customer service such that overall logistics cost is minimized.
With little initial capital investment and some re-allocation of existing transportation resources, Leggett and Platt can benefit from less-than-truckload consolidation to realize transportation cost savings. Implementing a hub-and-spoke model with several extended approaches such as multiple stops and expanded local service regions, has been shown, through support of the scenarios tested in this study, to effectively lower the cost of shipping Leggett and Platt products throughout the United States.