In the dynamic and challenging landscape of the startup world, we were presented with the formidable task of transforming the supply chain operations at Gorillas, a rapidly expanding company. Amidst a backdrop of dwindling venture capital funding and escalating cash burn rates, the company's reliance on a Direct Store Delivery (DSD) model was proving increasingly untenable. This model was plagued by inefficiencies, leading to elevated waste levels and suboptimal stock availability.

Confronting these challenges head-on, we initiated the development of a Self-Distribution Center (SDC) in Upper Manhattan. This strategic move was a significant pivot from Gorillas' existing operational model and was pivotal in transitioning control of their supply chain away from external vendors, thereby enhancing operational efficiency. The SDC served as a crucial stepping stone, significantly improving key performance indicators. We witnessed a reduction in the inventory to sales ratio, dropping from 6.5 to 4.1 days, a decrease in waste from 18% to 12% of revenue, and an elevation of in-stock rates from 88% to 91%.

However, the SDC was just the initial phase of a broader, more ambitious plan. With a clear vision for a sustainable and scalable solution, we meticulously planned the transition to the Gorillas Distribution Center (GDC) in Long Island City. Over a year, our team reviewed over 500 commercial real estate listings in New Jersey and New York, visiting about 50 in person with the help of a CRE broker. When the right property presented itself on the market, we were experts and ready to act. We had the building under LOI, leased, and then occupied within four months.

This new facility, significantly larger and more technologically advanced than its predecessor, was equipped with features such as walk-in coolers and freezers and an enlarged picking area. This strategic upgrade significantly enhanced the capacity to manage a larger inventory and cater to the company's growth projections. Additionally, we implemented a WMS within an accelerated time frame, further improving labor efficiency and throughput.

The results following the implementation of the GDC were nothing short of extraordinary. We achieved a remarkable reduction in the inventory to sales ratio, bringing it down to an impressive 1.8 days. Waste was curtailed to just 8% of sales, and the in-stock rate soared to an impressive 95%. Moreover, the project consistently stayed under budget throughout most of its operational phase, underscoring the financial prudence and efficacy of this initiative. The success of the GDC was a testament to the power of strategic foresight, innovative problem-solving, and meticulous execution in transforming and modernizing supply chain operations.

This case study is a prime example of the transformative impact that expert consultancy can have within the startup ecosystem. It demonstrates how strategic consulting, underpinned by a profound understanding of operational challenges and industry dynamics, can catalyze significant improvements in efficiency, operational excellence, and financial performance. The journey from SDC to GDC at Gorillas is a compelling narrative of turning operational challenges into opportunities for growth and innovation, setting a new benchmark in supply chain management.