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Thus, the profits margins will decline, which is why creating consolidation and outsourcing the responsibility is the right decision taken by the company.The company has around more than 55 transportation companies and with the contract with DHL, this number will decrease significantly and will become 7.Answer 1: Lego has distribution centers in around 4 countries that include Denmark, France, Germany and Switzerland.Besides that, it also has around 11 warehouses in these countries.Lego Consolidating Distribution Case Solution On the other hand, 10 operations will be reduced and will come under one roof, which will also result in cost savings.Thus, cost saving is the major rationale behind this decision.Students: Tell your instructors about the savings at hbsp.When you place your first order on and enter your credit card information and shipping address, 'Speed-Pay' ordering is enabled.

The company’s focus on creativity, innovation and superior quality had, over time, created high complexity in the supply chain.

December 31, 2008 Two years after joining the LEGO Group as their Logistics Manager for Europe and Asia, Egil Møller Nielsen finds himself fighting several battles at different fronts; the most difficult one on his home turf against his own management team.

He is half-way implementing a bold plan: close down all existing local and regional logistics operations and consolidate all logistics and distribution activities from a central location in the Czech Republic, managed by an external partner - DHL.

The relationship is strained; both companies are under tremendous pressure from their corporate headquarters to show results while there is a general distrust in each others capacity and motivation.

In this first case we learn that building a relationship that is based only on a contractual agreement can be a painful experience.

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