Business BackgroundThe Scotts Company began selling hardware and seeds in Marysville, Ohio in 1868. It specializes in seeds, fertilizers, peat moss, potting soils and other organic materials. In 1995, Scotts was the world's No. 1 retailer of lawn and garden products. European operations were launched in 1993, with headquarters in Lyon, France, and five additional European operations acquired in the United Kingdom, France, Germany, Austria and Benelux. Symptoms and Problems The main symptom and concern is that Scotts' European sales had increased as expected, but margins had decreased and synergies between the acquired companies were not working as expected. Additionally, one of Scotts Europe's largest customers was threatening to leave due to unacceptable service levels which could cause a domino effect to other large customers. The main problem is basically related to supply chain problems, including duplication and inefficiency in sourcing, manufacturing and distribution. . Therefore, task no. 1 is to optimize the supply chain and reduce costs. We would like to delve deeper into the sub-problems and causes:1. Each office has its own supply management function which increases the Group's purchasing, manufacturing, packaging and delivery costs. Scotts Europe has hundreds of suppliers, numerous uncoordinated contacts, even several contacts with the same supplier, but with different prices.2. Products are not standardized and vary by country in terms of type, packaging and specifications. This increases production times, production costs, delivery times… half the paper… 2 – 5 million euros per year.5. Assign special key account managers for large accounts. Introduce discount policies and customer loyalty programs.6. The factory no. 1 in the UK is facing significant losses, due to high fixed and overhead costs. Since the future outlook is in the red, the plant should be closed and the equipment moved to plant no. 2. The planned annual savings are between EUR 500,000 and EUR 750,000.7. A detailed analysis should be carried out on the performance of 13 distribution centers: capacity, inventory rotation, costs, etc. It appears that most centers should be closed as they act as too much of a link in the supply chain, accumulating high levels of inventory. All these improvements will increase profitability by identifying at least the 30 million euros requested by the US headquarters. However, we believe it is unrealistic to manage this entire turnaround in the space of a year. It may take 2 to 3 years.