Customer
Major Food Customer
Details
As LLP, CJ Logistics worked with a major food customer to develop a supply chain network that maximizes cross-company collaboration, facilitates import container movements and handling, prepares product for market, services the retailers’ needs, and delivers significant cost savings.
Situation
As Lead Logistics Partner (LLP) for a major food company, handling their entire North American supply chain, CJ Logistics oversees five multi-customer Regional Distribution Centers (RDCs) and manages all transportation, from port to delivery to customer. When spun off from their parent company, which had previously performed all domestic supply chain functions, the company decided to outsource all supply chain management to one provider, CJ Logistics.
Solution
CJ Logistics set up the company’s entire supply chain – from the moment the container arrives at the port to the point at which the product is delivered to the customer. Our network analysis optimized geographies, reduced distribution centers from eight to five, established more efficient shipment modes and reduced overall inventory levels. All sites were converted in a simultaneous, “big bang” conversion, with no business disruption.
Our transportation solution included analysis and recommendations for the optimal US ports of entry and the most efficient shipment modes. We redefined their supply chain, helping to optimize their mode selection, load utilization, production planning process and ocean deployment process from their plant overseas. We routed inbound product from overseas direct to all five RDCs, enabling receipts at east coast ports instead of through one port on the West Coast, and establishing new carrier and port relationships.
We helped the customer redesign their overseas warehouse and developed a deployment management tool and process that uses their sales forecast to identify the amount of inventory to be deployed to the RDCs to meet customer demand and ensure sufficient yet efficient inventory levels.
Trust and strong working relationships across the organization developed from day one. Two dedicated resources, one on-site at the company’s headquarters helps deliver the tactical day-to-day support, and a Strategic Partnerships liaison based at CJ Logistics corporate manages projects and resources in support of joint initiatives. Monthly meetings aligning operations and corporate resources rotate among RDCs.
Result
CJ Logistics as LLP provides a consistent source of data, information and process. The seamless transition and execution helped maintain and grow our partner’s customer base. The network now facilitates import container movements and handling, prepares product for market, services the retailers’ needs, and delivers significant cost savings. Optimizing inventory levels and increasing plant-direct shipments has led to significantly reduced inter-RDC transfers and successful postponement strategies. Eliminating pallets from transfer orders reduced 1,500 pounds of pallet weight per load and replaced it with product, resulting in savings of $750,000 per year. Shipping directly to the RDCs from overseas has reduced supply chain costs by $800,000 per year. Moving the company’s US distribution centers closer to their food service customers and reducing transit times has resulted in increased service levels to their food service customers.
