TEAM
ESTRELLA
IIM MUMBAI
Indrajeet Dutta Ishika Padhy Palash Jain
As-Is & Demand Logistics Optimization Cost Optimization & Technology Integration 2030 Roadmap &
Growth Forecast Strategy Efficiency & Sustainability Prioritization
As-Is Analysis
Suppliers 25 Regional Depots
MDLZ Product Portfolio Understanding the Problem The Ask: Goal to attain!
Mondelez Supply Chain
2700+ • Demand Growth Leverage brand equity &
1 Forecast network to inc. biscuit
Distributors market penetration
• Logistics Optimisation
2
4 Manufacturing Modern Trade
Traditional Trade
Modern Trade
Facilities of • Cost Optimisation Penetrate the expanding
Revenue
Outlets 3
Mondelez in India rural market
• Induri, MH E-Commerce • Technology, Innovation
platforms 4
• Malanpur, MP Develop a Route-to-
• Baddi, HP Institutional Biscuits Health Drinks • Sustainability Initiatives
5 market strategy with the
• Sri City, AP Sales (Canteen) Chocolates Cadbury Dairy Milk 2030 Roadmap
Demand Growth Forecast
Forecast of Mondelez Chocolates Input Parameters Python Code Monthly Forecast for Selected SKU
Date (Date of Sale) Model compares
CAGR = 6.9% SARIMAX
2 MAPE across 6
Sales Quantity algorithm & select
1
Linear Regression most accurate
0
Price
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Holt-Winters
Competitor Price
Forecast of Mondelez Biscuits Random Forest
Consumer Confidence Index* Date Month Forecast Value
CAGR = 5.53%
0.5 XG Boost Python code was 31-03-2024 3 14.8318
Advertisement Spent
executed on Sample 30-04-2024 4 16.2488
0 Data. Table shows 30-05-2024 5 14.8534
Festive Season (Yes or No) LSTM o/p for the 4 months
29-06-2024 6 17.1879
*CCI reflects consumer sentiment.
As-Is & Demand Logistics Optimization Cost Optimization & Technology Integration 2030 Roadmap &
Growth Forecast Strategy Efficiency & Sustainability Prioritization
Benchmarking Recommendations
Parameters / Network Optimization done by adding only 1 warehouse between plants and RDCs.
Companies
25 depots across Global and Extensive Strategic depots
Warehouse
India, regional regional DCs; distribution focussed on
Logistics Efficiency
Network distribution highly optimised network in India urban centres
Extensive 3PL, Dynamic
Mix of own, 3 Uses all modes
Transportati dynamic routes, routing, real-
PL, limited of transport;
on Mgmt. urban and rural time tracking,
dynamic routing dynamic routing
reach mixed transport
Depot Centralized
Integrated cold Plant
Advanced cold Cold chain for warehouse
Cold Chain Basic cold chain chain for
chain for dairy, personal care,
Integration for chocolates beverages,
infant nutrition food
snacks By adding only 1 warehouse (Capex only required), cost savings realized = 8.64%.
From the warehouse/plants, the goods will be sent to MT/E-Com/Institutions
Standard ERP, AI, IoT, IoT, AI,
Technology AI, blockchain, (benchmarked with ITC’s supply chain)
limited automation, blockchain, SC
Adoption automation
automation blockchain pilot visibility
Leader in Focus on water Sustainability
Integration Cold & Ambient SC in logistics with
Conventional, our proposed Multi-purpose Vehicle.
Sustainability sustainability, conservation & logistics, EV,
focus on • The cold chamber is kept in the middle and the
Initiatives carbon neutral eco-friendly carbon-neutral
sustainable pkg.
SC Integration
goals logistics initiatives ambient chambers are kept in both the sides.
This is done taking into consideration the
different (weight/volume) ratios.
Insights of Benchmarking • Heat Exchanger for cold chamber is kept
above such that heat exchange doesn’t affect
the condition of biscuits.
• Only one vehicle can be used to transfer both
Cold Chain and Ambient Use of Technology Focus on sustainability types of products. Cold section can be switched
Chain Integration. Innovation & Integration. practices like EV, pkg, etc to ambient chamber whenever needed.
As-Is & Demand Logistics Optimization Cost Optimization & Technology Integration 2030 Roadmap &
Growth Forecast Strategy Efficiency & Sustainability Prioritization
Cost-to-Serve Evaluation Recommendations
Use Multi purpose vehicle i.e., used for both cold as well as ambient products for
transportation from warehouse to regional depot for maximum utilization of vehicle.
Plant Warehouse Regional Hub Mathematical model is built for optimal product mix (Cold +Ambient) to transfer.
Inbound cost and outbound cost: It is about 69% of the total cost , mostly Influenced
by Weight to volume ratio of product and use of dedicated fleet for each category of
Parameters Denotion Objective function:
product resulting in more vehicle trips hence more transportation cost.
Z=Max Utilization of truck
Avg weight of chocolate wc
Warehousing cost: About 23% of total cost , influenced by cold storage requirement of
Avg weight of biscuit wb Subject to:
chocolates , overstocking of different SKUs and inefficient warehousing practices.
Inbound and Outbound
Weight (Biscuit)+weight(Chocolate)<=weighing
Avg volume of chocolate Vc
capacity of truck
Waste: About 8% of total cost primarily because of unavailability of electricity in rural Avg volume of biscuit Vb Volume(Biscuit)+volume(Chocolate)<=Volume
areas leads to more product wastage and cost increment.
capacity of truck
Decision Variable Category
Weight/Volume of
Omnichannel cost is higher than TT or MT because of last mile delivery requirement.
X1 Chocolate chocolate=1.5*weight/volume of biscuit
X1, X2 >=0
X2 Biscuits
Recommendations
Use Solar Panels with visi-coolers in rural areas to avoid the high wastage (CTS: rural After solving the model for 1 SKU of chocolate and 1 SKU of biscuit, the optimal
> urban). Solar Panels can be given by the company along with visi-cooler to penetrate. product mix for a 12-wheeler truck is coming out to be:
Visi-Cooler uses 1 unit / Chocolate in KG Biscuit in KG Weight Utilization 0.61082874
Waste
day electricity. 3772.35 7833.396 Volume Utilization 0.98596444
Therefore, Solar Panel of
0.25 kW can be used
By Applying these models, we can utilize Mathematical model
which comes down to
the maximum capacity of truck which can formulation and
Solar Panel of 1kW = Rs 50,000 Rs 15,000. This can lead
significantly reduce the inbound and calculation done in
Produces 3-4 units/day electricity to savings of 8% waste.
outbound cost. Excel (Click on icon).
As-Is & Demand Logistics Optimization Cost Optimization & Technology Integration 2030 Roadmap &
Growth Forecast Strategy Efficiency & Sustainability Prioritization
Technology Integration Sustainability Initiatives
RM contributes the highest
AI Driven Demand forecasting: Use Machine learning and Artificial
%age to Carbon Footprint;
Intelligence techniques to forecast the demand accurately hence result in the
Sourcing
Cocoa and Dairy are the
reduction of overall inventory.
Production
highest. Ethical sourcing
IOT for Predictive Maintenance: Implement IoT in production system using Smart Contracts
to continuously gather the data from different units to analyse the maintenance with Blockchain for Tier-
requirement and reducing downtime. 1/2 supplier transparency.
Ref: Mondelez – Snacking Made Right, 2023 ESG Report
Smart Manufacturing Execution System (MES): Integrate a smart
MES that provides real-time monitoring and control of production processes, • Rainwater Harvesting involves collecting & storing
Operations
improving efficiency and ensuring timely adjustments to production schedules. rainwater for multiple purposes, including groundwater
Dynamic Route Planning: Implement dynamic route planning in logistics recharge.; Implemented by Dabur, HUL, ITC, GCPL, Parle.
to adjust routes in real-time based on weather, traffic, and road conditions,
• LED Lighting with a Power factor of 0.99 across all units
Transportation
ensuring timely deliveries and reducing fuel consumption.
of 4 Mfg. plants; Solar Power plant system in warehouses.
Collaborative Logistics: Partner with other companies for shared
logistics services in rural areas, maximizing capacity utilization and reducing
• Packle Wrapping is not boring like paper. It is glossy!
transportation costs.
• Protects chocolates from moisture and humidity.
Packaging
Telematics for Fleet Management: Use telematics to monitor vehicle • Recyclable, eco-friendly, and plastic-free wrapping.
performance, driver behaviour, and fuel efficiency, optimizing fleet operations
and reducing maintenance costs. • Smile Environment: Through our Sustainability Score
Index and packaging, we tell the impact the customer is
Real-Time Inventory Tracking: Implement a Warehouse Management creating in the environment through each purchase.
System (WMS) to track inventory in real-time and calculate dynamic safety stock,
Warehousing
automatically placing orders when needed. • EV Vehicles for last-mile deliveries can be utilized.
RPA for Task Automation: Deploy Robotic Process Automation (RPA) • Companies like MoEVing are dedicated to last-mile
Logistics
to automate repetitive tasks like order picking, packing, and sorting, increasing delivery; SPOC for E2E services (Fleet +Drivers).
efficiency and accuracy.
Smart Storage Systems: Use automated storage and retrieval systems • For transportation other than last-mile, use software that
(AS/RS) that dynamically organize and retrieve products based on demand, calculates the fleet’s carbon footprint. This data makes
improving space utilization and order fulfilment speed. organizing transport routes and loads easier.
As-Is & Demand Logistics Optimization Cost Optimization & Technology Integration 2030 Roadmap &
Growth Forecast Strategy Efficiency & Sustainability Prioritization
2030 Roadmap
Implementation Phase 1: Foundational Flourish
• Packle & Smile Environment • Network Optimization & Solar Panel for Visi. • EV for last-mile deliveries.
2024 2025 2026
• AI-driven demand forecasting • Multi purpose Vehicle for SC Integration, IoT • Rainwater Harvesting
Implementation Phase 2: Strategic Strengthening
• Telematics for Fleet Management, RPA • Smart Contracts, LED Lighting, Carbon Footprint software
2028 • Smart Manufacturing Execution System (MES) 2027
• Smart Storage Systems, Collaborative Logistics
Implementation Phase 3: Sustained Success
• Replicate model in more target cities/villages. • Scale up all capabilities for expansion, make the plan richer for all derived data.
2029 • Target the Non-consuming variety seeker. 2030 • Drive exponential growth from Brand Equity and extensive distribution network.
R.I.C.E. Prioritization Codes & Excels
Recommendations for Suppliers Reach Impact Confidence Effort Score Implementation
Phase 1 Phase 2 Phase 3
AI-Driven Demand Forecasting 90% 90% 0.27
Network Optimisation 100 % 90% 0.68
As-Is Optimized Forecasting
Multipurpose Vehicle 100 % 80% 0.26 Network Network code
Solar Panel with Visi Cooler 80% 100 % 0.75
Packle Wrapping 90% 90% 0.54 Network optimization
EV for Last Mile Delivery 90% 90% 0.162
Following the R.I.C.E. framework, we will begin with Solar-Powered Visi Coolers, proceed with Network Optimization, which requires Forecasting
capex for one warehouse installation, and then tackle low-hanging fruits like Packle Wrapping, followed by AI-driven Forecasting.
