4170 Stillwater Drive, Duluth, Georgia 30096 | 678.576.0562 | carlos@cavazquez.com | cavazquez.com ADM T ags Chainalytics t o P repare their S upply C hain for S ignificant G rowth One of the world’s leading human and animal nutrition companies, ADM expects its flavor business to grow considerably in the coming years. They brought on Chainalytics to help prepare their supply chain for anticipated growth. ADM’s Global Flavors business looks to grow robustly over the next five years. Given that forecast, it’s no surprise they’ll need an equally robust network to serve it. Strategic goals and considerations included leveraging capacity across continents, maximizing load capacity at underutilized locations, and minimizing cost and capital expenditures. So too was raising service levels to help secure market share. P reparing for sales growth require d reducing risks and building supply chain resilience. Testing possible supply chain development options To look at different ways to grow the supply chain, you need to build a digital twin of the ADM business. Using Chainalytics’ proven supply chain design methodology, the twin is an indispensable support for the decision - making process. Global Flavors has a corresponding footprint that affects the entire value chain. Manufacturing on many continents — including Asia, Europe, and the Americas — t he digital twin needed to look beyond the usual costs related to manufacturing and distribution, like labor, transportation, and inventory. These were added to raw material costs and the related effects on tariffs when shipping across international borders and using cheaper raw materials and lower - cost labor strategies. Early engagement with the global leadership team was critical Bringing in the C - suite and other stakeholders in the early stages helped identify opportunities. W hich alternative strategies could bring the most value to the Global Flavors business ? W hich lower - value opportunities should be abandon ed? 4170 Stillwater Drive, Duluth, Georgia 30096 | 678.576.0562 | carlos@cavazquez.com | cavazquez.com The team took both qualitative and quantitative approaches to define the scenarios to pursue. They spent a great deal of time on design data creation, making sure the output aligned with the needs of global leadership. The project team created touchpoints with the global team, getting everyone on the same page on alternative strategic scenarios and design data validation Elements of the core strategy The central strategy focused on a select group of high - volume make - to - stock products This freed up a relatively large piece of manufacturing capacity. Another important element was the global sourcing of raw materials, a substantial share of which comes from China. When imported into the US , these are subjected to tariffs of up to 25 percent These trade - relations - based complexities led to a thorough evaluation of differing flow paths and manufacturing locations. The tradeoffs examined with the digital twin revolved around labor costs, real estate costs, and tariffs. These were compared with higher transportation and inventory costs. Secondary strategies focused on reallocating production volume to manufacturing locations in - market , particularly in Asia - Pacific ( APAC ) and South America R esults and takeaways The tariff - influenced reconsideration of flow paths and manufacturing locations resulted in US$ 10 – 12 M in savings per year , between 12 – 15 percent of costs in play. The local sourcing and reduced labor rate benefits of in - market plants not only led to higher service levels. They amounted to US$ 7 – 9 M in savings per year, or between 7 – 9 percent of costs in play. These results are due to the digital twin. Using a model to identify opportunities is a must - have when quickly evaluat ing different options. Modeling can’t be a one - time exercise; you must embed the application of the digital twin i n the organization. The ability to answer strategic and tactical questions depends on an up - to - date model that deliver s investment - grade information. Like no other tool, a digital twin enables high - confidence decisions quickly enough to matter. Collaborating with skilled consultant s , who work to improve the logistics of some of the biggest companies around the world , can make a big difference. Let Chainalytics help take the kinks out of your fulfillment process and realize your company’s potential.