Designing a Cost-Efficient Fulfillment Network for Scale

The Challenge

A fast-growing health and wellness food brand was preparing for its Series B raise. Despite strong demand, distribution costs were consuming nearly 15% of net sales—almost double the brand’s 8% target. Leadership needed to know whether the existing chilled distribution network could scale efficiently or if a structural redesign was required.

The brand’s mix of national distribution and regional fulfillment created fragmented visibility, inconsistent freight costs, and limited leverage with partners—particularly with its national distributor, where unexpected fees were inflating costs.

Our Approach

Izba conducted a comprehensive network analysis, using shipment data, freight invoices, and sales velocity by region to identify cost levers and structural opportunities:

Freight Optimization with National Distributor

• Analyzed freight billing models and uncovered savings potential by switching from case-based to per-pound billing—representing $200K in annual reduction.

Scenario Modeling for Coast-to-Coast Transfers

• Modeled a “Scenario 3” solution, routing inventory directly from manufacturing to a strategically placed distribution center on the opposite coast.
• Reduced transloading steps and improved per-pallet economics.

Accessorial Charge Management

• Flagged recurring detention and delivery appointment costs.
• Implemented a standardized PO tracker and deduction management SOP to proactively manage and dispute fees.

The Outcome

The brand gained a clear roadmap to scale profitably:

• Network redesign options quantifying cost-to-serve across multiple hub configurations.
• Immediate savings via renegotiated freight terms with the national distributor.
• Operational discipline through PO tracking and deduction management tools.
• Path to target: A step-by-step roadmap for achieving 8% distribution cost as volume and efficiency scaled.

By pairing data-backed modeling with operational rigor, Izba helped them move toward a fulfillment network designed for both financial health and future growth.