31 October 2013 – Pick ‘n Pay has awarded a five-year contract for supply chain management and transport management services (TMS) to Imperial Logistics. This partnership is expected to yield a 20% net saving on transport costs over the contract period; largely from the integrated management of demand and supply of transport services.
Imperial Logistics chief integration officer Cobus Rossouw explains that the new transport management service reduces total distribution cost through planning optimal delivery events and routes and ensuring adherence to these plans. “The service encompasses central planning and proactive execution management, which ensures improved compliance with distribution plans, and the escalation of activity, route and delivery exceptions. Compliance to planned events and routes translates into improved customer satisfaction and reduced cost.” He stresses that “the service to Pick n Pay is advanced in that it also focuses on the demand for transport activity. We work closely with the stores, warehouse, equipment centers and back-haul suppliers to predict and smooth demand for vehicles. The majority of the savings are delivered from the alignment of demand and supply.”
This transport management service has already been implemented at three facilities – Longmeadow in Johannesburg as well as Phillipi and Airport in Cape Town – for Pick ‘n Pay’s perishables and grocery lines. “The plan is to extend it on a national basis to the smaller facilities in KwaZulu-Natal and the Eastern Cape. This integrated service model will optimise all logistics activities in the end-to-end supply chain of Pick ’n Pay, enabling the company to extract maximum benefits from supply chain centralization and distribution centre operations,” he notes. “We believe that practical changes can drive improvement without major investment, and are confident that these will improve service, reduce costs and increase control for Pick ‘n Pay in its supply chain,” Rossouw adds.
The contract also includes inbound logistics activities, performance measurement and continuous improvement initiatives. Rossouw elaborates: “Imperial is managing the operational scheduling of all inbound transport, translating demand planning replenishment requirements into operational reality.”
As part of this engagement, Imperial Logistics provides continuous improvement and performance measurement to support Pick ‘n Pay’s strategic supply chain initiatives and optimise logistics costs and efficiencies. “A critical part of the success of this partnership with Pick ‘n Pay is identifying relevant key performance indicators and thereafter continuously measuring and improving these,” Rossouw states.
To enhance supply chain visibility and synchronisation, Imperial has implemented its One Network technology. Imperial Logistics’ partner One Network Enterprises’ cloud-based platform is the only supply chain solution of its kind in the world. “It makes it easier to respond and adapt to changes in the market, while lowering costs,” Rossouw explains. “For Pick ‘n Pay, One Network technology will bring the benefits of inbound appointment scheduling. We are busy to expand its application to further enhance supply chain visibility as part of the our service to Pick n Pay.”
“Imperial Logistics is confident that, through our partnership, Pick ’n Pay can realise the intended supply chain savings and benefits. The gain-share commercial principles we applied is focusing the attention of all stakeholders on driving towards the desired outcomes”he concludes.