[ Solution Finder ] Retail & CPG High Tech Aftermarket Service

 

Introduction

The Kroger Company is a $54 Billion retailer with 330,000 employees in grocery and other retail divisions. They are currently the 4th largest global retailer and 2nd largest grocery retailer with over 29 manufacturing facilities and 30 distribution centers managing both dry and refrigerated goods. Kroger grocery banners include Kroger, Ralphs, Fred Meyer, King Sooper, Peyton, and Frys.

 

The Challenge

De-Centralized Operational Environment created through years of company acquisition

Through years of growth via acquisition, Kroger's supply chain had become fragmented and de-centralized. This structure did not enable Kroger to take advantage of economies of scale across their organization. Starting in 2000, Kroger management decided to centralized several of their operations including transportation. They recognized a centralized transportation operation would enable:

• Greater productivity from their workforce through streamlined and synchronous processes
• Provide volume advantages when negotiated carrier contractual rates
• Improved inbound visibility with their vendors
• Better identification of lanes where Kroger could take over control of vendor-controlled freight where it was economically feasible
• Improved private fleet asset utilization for back-haul lanes

 

The Solution

Used One Network’s Retail Solution to centralize transportation management and automate appointment scheduling across Kroger’s divisions

• Automation of routing, carrier selection, and contract management processes
• On-line appointment scheduling at distribution centers requiring all vendors and carriers to schedule appointments, via the Internet, instead of through the phone
• Provided shipment visibility within transportation organization and beyond to Kroger procurement and distribution and vendors.
• Lane by lane vendor allowance and profitability analysis
• Integrated carrier base eliminating reliance on phone and fax communication
• Creation of standard transportation measurements including on-time delivery, carrier acceptance / rejection rates, and vendor target delivery date compliance
• Utilized One Network "hosted" solution enabling a rapid deployment across Kroger's supply chain network.

The Results

Improved supply chain visibility, increased supply chain metrics, and centralized transportation management

• Provided a single systemic platform across Kroger's Manufacturing and Retail Transportation Centers
• Captured 100% of transportation relevant data systemically in a central database repository for analysis and long-term planning. Examples of data captured include load tenders, load tender responses, freight costs, on-time deliveries, and vendor allowance costs.
• Reduced the annual inbound freight expenditures across Regional Transportation Centers and Manufacturing plants through centralized shipment planning and systemic routing guide compliance
• Reduced the inefficiencies inherent in a phone and fax shipment-tendering and appointment scheduling process allowing Kroger to eliminate overhead and redeploy resources to more value-added, strategic tasks.
• Provided product delivery visibility to procurement organization within their buying application. Previously procurement phone calls were required to transportation and vendors, in order to identify if delivered freight was scheduled to arrive on time.
• Improved Supply Chain Metrics
  • Vendor delivery date versus requested delivery date compliance
  • Carrier turnaround time at Distribution Centers
  • Number of orders re-scheduled by commodity code
  • On-time delivery
• Improved contract management control. Previously Kroger could not audit whether divisions were utilized approved core carriers. Additionally, divisions were negotiating one off carrier contracts, which created increased costs and audit nightmares.
• On-line appointment scheduling provided a unique advantage because it enabled Kroger 100% of inbound freight. Traditional transportation solutions provided visibility to controlled freight, which represented only 30% of their total volume. Appointment scheduling captures the remaining 70% of vendor controlled freight and enables 100% visibility of inbound freight.
• Deployed and integrated with existing procurement system within 90-days of contract signature

About One Network Enterprises

One Network provides the value network infrastructure and Web applications as hosted networked services. Demand signals reach all parties on the network simultaneously, faster than traditional point-to-point EDI or batch communications. ONE's Intelligent Execution Manager creates and adjusts orders automatically at any “echelon” in the network - stores, distribution centers and suppliers - based on real-time demand and available supply at all echelons. Users improve service levels and same-store sales by accelerating the movement of inventory and data through the value network. One Network created and hosts internet-based value networks with many-to-many connectivity, built on next-generation technology delivered in a flexible on-demand model. Rather than simply accelerating point-to-point data exchange along a traditional linear supply chain, the One Network is a highly distributed value network where any participant can see and react to what is happening at any point in the network. Beyond visibility, the solution integrates transaction management with execution and real-time planning. Network participants create and share multi-company business processes, and can quickly adapt them in response to changing conditions. Incremental decision support allows partners to resolve issues as they arise in real-time, and automatically guides operations towards business objectives.

For more information, please call +1 866-302-1936 or visit www.onenetwork.com.

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