Client:
A growth-stage food manufacturer producing plant-based meat products
Challenge:
The company was preparing to launch a new product line from a newly constructed facility, and their operations required precise planning around refrigerated storage for both raw materials and finished goods.
They faced a critical capital expenditure decision regarding the size, capacity, and build of the refrigerated storage area in the new facility. The original estimates were based on rough assumptions and conservative planning, which led to an overbuilt, overbudget facility design.
As storage assumptions became more aggressive, capital requirements increased exponentially. Leadership feared they were about to spend heavily on refrigeration capacity that might sit underutilized. They lacked the modeling tools or data frameworks needed to accurately determine inventory storage requirements, which would allow them to right-size the facility design before committing millions in build-out costs.
Strategic Objectives:
Company leadership engaged Waypost to help them avoid over-investment by grounding their refrigeration space planning in data and inventory science. Their goals included:
- Create a dynamic, data-driven inventory model aligned to projected demand and operational constraints.
- Assess variability in production, shelf-life limitations, and supply assumptions to define true storage needs.
- Explore cost-effective alternatives for overflow storage scenarios.
- Use inventory modeling to drive confident, cost-efficient capex decisions for the new facility.
Approach:
Waypost initiated the project with stakeholder interviews to understand the full supply chain—forecasted demand, batch production strategies, shelf-life of raw and finished goods, and operational constraints on throughput.
Then, an inventory planning model was developed that allowed the team to simulate demand, production, and storage requirements under various realistic scenarios. This tool accounted for:
Shelf-life constraints on raw materials and finished goods
- Service level expectations and production variability
- Expected peaks and troughs in demand and supply
- Overflow contingency planning using mobile cold storage solutions
Instead of defaulting to a 14-day inventory assumption (which had driven the oversized refrigeration specs), the model showed that the company could operate effectively with just 10 days of on-hand inventory—even accounting for variance and risk.
Waypost also helped the team model the cost-benefit of temporary refrigerated trailers for occasional overflow, showing that over a five-year period, this solution would cost far less than the $900,000 in capex savings it enabled.
Key Steps:
- Stakeholder interviews to map process flows and planning logic
- Build of inventory scenario model for variable demand and supply conditions
- Identification of shelf-life and production cycle constraints
- Development of alternate storage options for exception handling
- Translation of model outcomes into facility design recommendations
Assessment Areas:
- Inventory turnover assumptions and shelf-life boundaries
- Demand variability and forecast accuracy
- Production cadence vs. storage capacity
- Facility cost vs. overflow storage cost models
- Supply chain risk management via buffer strategies
Tools and Methodologies:
- Demand and inventory modeling framework
- Capacity-constrained production simulation
- Capex vs. Opex scenario cost modeling
- Service-level and risk-adjusted buffer analysis
Deliverables:
- Inventory optimization model for facility planning
- Final recommendations for refrigeration capacity
- Decision framework for temporary vs. permanent cold storage
- Scenario analyses to support stakeholder alignment
- Financial impact summary showing capex avoidance
Conclusion
Thanks to the Waypost analytics-driven approach, the company was able to confidently reduce refrigeration design assumptions from 14 to 10 days of inventory. This adjustment enabled a $900,000 reduction in capital requirements—without compromising operational readiness or supply chain continuity.
By leveraging mobile refrigeration only when needed, the company avoided sunk costs and preserved flexibility. The result was a final facility design that was leaner, smarter, and better aligned with actual operating needs.
“Our discussions with Waypost prompted our thinking in the right direction, which subsequently led to a 45–50% reduction in cost for the final design assumption vs. the proposed design.”— Engineering Project Manager