Network Optimization to Reduce Transportation Costs and Improve Supply Chain Planning

CLIENT

• One of the leading LPG distributors in Brazil. The company serves approximately 10 million households and commercial customers, holds more than 20% market share, and sells over 1.5 million tons annually.

• The company operates a national logistics network with more than 20 production units and more than 40 storage facilities, supporting its presence in Brazil's residential and bulk LPG markets.

CHALLENGES

• The company needed to improve logistics efficiency across a complex national network while respecting supply, capacity, and operational constraints.

• Leadership required a more robust analytical tool to support planning decisions across S&OP processes.

• The objective was to identify the most efficient flows across the network and translate them into measurable cost reduction opportunities.

OUR APPROACH

• Developed a custom optimization model in AIMMS® to represent the client’s LPG network and support decision-making across a highly complex logistics footprint.

• Tailored the AIMMS® model to the company’s specific planning requirements, incorporating supply constraints, capacity limits, and operational rules.

• Used the model to identify the best feasible flows across the network, validate results against the baseline, and enable the client team to embed the solution into its planning routines.

RESULTS

• Mapped opportunities to reduce total logistics costs by up to 10%, improving the quality of S&OP and S&OE decisions.

• Strengthened the client’s planning capabilities through an analytical, scalable, and reusable optimization tool.