io is designing LIEBHERR's U.S. distribution center
At LIEBHERR, we think big—and it’s a tradition. After all, this company—founded in 1949 in Kirchdorf an der Iller and now employing over 50,000 people across more than 150 subsidiaries—deals in truly heavy-duty equipment. For example, earthmoving machines and tower cranes for the world’s largest construction sites, all the way to mining dump trucks and offshore cranes for drilling platforms. So it’s no wonder that the property recently acquired by LIEBHERR in the Hive Business Park near Tupelo, Mississippi, is quite impressive. It measures 480,000 square meters—48 hectares—on which a state-of-the-art spare parts center is now being built. With this distribution center, LIEBHERR aims to expand its logistics network across North and South America, optimize its growing after-sales business, and strengthen its presence in the American market. It is scheduled to go into operation as early as next year. That’s quite fast, considering that LIEBHERR didn’t turn to io for its design, network study, and a make-or-buy analysis until the summer of 2023…
“The new location is intended to enable LIEBHERR to guarantee its North American customers a late cutoff time with reliable next-day delivery of critical replacement parts,” says Rupert Höcherl, Managing Director and Partner at io. For this reason, the requested concept design also included a center-of-gravity analysis and a recommendation of potential target regions. “In addition, the distribution center was to be set up as a free trade zone, with the inventory remaining the property of the supplying manufacturers,” Höcherl adds.
Find the Perfect Location with io
io handled the project comprehensively—on time, within scope, and on budget—and took a holistic, conceptual look at the needs of the new location to best identify its key characteristics. “First, we consulted with LIEBHERR on fundamental key questions,” Höcherl continues: Which warehousing concept is best suited? In which regions can the cutoff times of the major package delivery services be optimally utilized? Which state offers ideal conditions and, ideally, start-up incentives as well? Will the facility be operated by the company’s own employees or by a 3PL, i.e., an external logistics service provider? As a first step, io addressed the question of location. “We determined the optimal region for the location using a center-of-gravity analysis,” Höcherl explains. “We then calculated the future transportation costs for the inbound and outbound transport volumes at the potential locations, taking into account the determined cutoff times as well as regional cost differences.” Once the Hive Business Park near Tupelo, Mississippi, was identified, LIEBHERR was quickly convinced as well. At the same time, work began on the other tasks. io grouped them into three additional modules so they could be worked on simultaneously—despite the varying dependencies among the individual tasks. Within a few months, the project team developed a modern concept for operating a highly automated spare parts warehouse in-house, which will enable LIEBHERR to efficiently ship spare parts throughout North America in the long term.
Digitally controlled, efficiently implemented
The various disciplines involved in the operational execution were all coordinated by io, in close collaboration with LIEBHERR—including its project team based in Germany. To make communication as efficient and seamless as possible, io created its own project portal, complete with practical features such as unlimited data transfer, a project calendar, and document management. The results are already impressive: the brand-new, highly automated, scalable distribution center in Tupelo, Mississippi, featuring sustainable design elements. It is currently being completed—and will soon provide jobs for around 180 new employees. Incidentally, further investments on the new company grounds are already planned: LIEBHERR intends to build a corporate campus. This vision underscores the forward-looking commitment of this long-established company.
