Improving Productivity in Warehousing and Delivery Logistics

The Challenge:

Premier Beverage is a tier 2 distributor serving the wine and spirits needs of customers throughout Florida from two separate distribution facilities on opposite sides of the state in  Tampa and Miramar.

The task that the project team was assigned with was twofold:

  1. Improve the productivity of the warehouse, which consisted of a 30% untrained, temporary workforce.
  2. Increase truck utilization and optimize the fleet of 150+ delivery trucks that are dispatched state-wide to service both on-premise licensed restaurants and off-premise accounts ranging in size from corner stores to large retail grocery chains.

The Results:

Overall results across both distribution sites yielded an approximate 4% improvement in warehouse and distribution expenses, generating an approximate 2 to1  annualized return on investment. The key focus and highlights in each of the operational areas of focus were as follows:

Warehouse:

Generated a 15% improvement in warehouse productivity through the implementation of process changes while balancing workload requirements through better overall management of temporary labor with varying daily order volume.

Method Changes included:

  • Moved broken bottle processing to driver check-in staff for completion earlier in shift, eliminating waiting time for drivers to return.
  • Re-aligned the replenishment volume triggers to reduce the replenishment frequency for slower moving items.
  • Re-assigned returns processing to the beginning of the night shift, helping to eliminate downtime while waiting for lines to start.
  • Implemented use of plastic totes for carrying high-breakage items down the conveyors.
  • Developed an activity based budget and resource plan along with scheduling tools to allow for accurate planning for temporary workforce based on anticipated volumes of work.

Distribution:

  • Increased the utilization of trucks by increasing the Cases/Route by 10% allowing for routes to be consolidated across the state, yielding an overall 8% reduction in fleet requirements.

Method Changes included:

  • Developed standard routes to increase consistency of routing and reduce work associated with manually creating routes.
  • Conducted an ABC customer analysis to better align the number of  deliveries per week per account type, thereby eliminating customer stops on smaller accounts where viable.
  • Implemented Last In First Out system for choosing trucks to expedite truck movement in the yard.
  • Developed approval process for submitting orders on off-scheduled  delivery days to reduce overall number of stops for recurring offenders.
  • Developed a labeling system for ensuring bins delivered to cross-dock locations did not end up on the wrong truck.

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