Horizon Hobby flies into new supply chain strategy one model plane at a time

Horizon Hobby built the groundwork for its success in a basement in 1985 and grew into the leading international developer of radio-controlled (RC) hobby products. Specializing in model aircraft, vehicles, boats, trains—you name it—Horizon Hobby brings world-class technology, convenience, and of course, fun to their customers.

The RC company runs two e-commerce distribution facilities in the United States, one in the Midwest and one on the West Coast. Initially, Horizon Hobby focused on business-to-business channels and later integrated into the expanding business-to-consumer segment. Horizon Hobby's headquarters in Champaign, IL, retains legacy staffing and warehousing, and as e-commerce progressed, their customer base stretched across the country. As the company continued to grow, it needed to improve its speed-to-market while providing rapid and affordable delivery to its customers.

The solution? Horizon Hobby decided to reevaluate its long-term supply chain network plan in order to alleviate capacity and fulfillment issues in its existing warehouses.

Horizon Hobby achieved tremendous sales growth due to increased demand during the pandemic, and the firm projects to double in three years. But the company lacked the industrial space needed to keep pace with fluctuations in sales to reach anticipated growth goals.

Improving the firm’s supply chain efficiency without sacrificing customer service required a supply chain consulting partner that could explore and assess network alternatives—including industrial facility location, size and incorporation of a hub-and-spoke operation model. To ensure the successful handling of product delivery and returns, and to reduce supply chain risks, everything from port options to manufacturing adjustments were on the table.

Horizon Hobby turned to JLL to help strategize and execute a major upgrade of its supply chain network. Together, they focused on three key areas:

• Data collection and baseline development. JLL provided the project team and other functional experts across the company (including transportation, distribution operations, and finance team) with a structured data request outlining the specific information needed to understand Horizon Hobby’s core business objectives.

• Operating model and scenario analysis. Using sophisticated operation modeling tools and data provided by Horizon Hobby's supply chain leadership, JLL analyzed various "what-if" scenarios and measured the cost and service performance relative to the current baseline. Experts also looked at warehouse locations on the East coast to service a significant group of regional customers.

• Recommendations and high-level planning. Once the project results were final, JLL provided recommendations to Horizon Hobby in a series of working sessions that outlined various operating scenarios, along with a complete execution plan.

After the successful outcomes of its supply chain consulting assessment, Horizon Hobby is now exploring JLL’s real estate-related advisory and brokerage services to support the company's future growth aspirations.

“JLL’s hands-on approach resulted in clear recommendations on how to optimize our current and future distribution footprint,” says Michael Ritter, senior vice president of supply chain management with Horizon Hobby. “All project objectives were met, and we were very pleased with the methods of execution and results delivered by the JLL team.”

Want to secure industrial real estate that aligns your logistics and supply chain requirements with your company’s unique business goals? Learn how JLL can help here.