Do you ship Less Than Truckload to your client’s warehouses and stores? Are their stores located in the same large retail or business complexes?
If so, then your business is a candidate to participate in the new logistics trend of shared or collaborative distribution. This trend will need the participation of manufacturers, distributors and retailers.
The objective is to reduce the number of less than truckload shipments by combining shipments from multiple manufacturers or distributors into one full truck load going to the same location.
Think of all the various deliveries to the retailers at a shopping mall. Each of the various clothing stores gets a truck shipment weekly. There may be over 10 clothing stores in the mall. What if, instead of 10 trucks arriving during the week, only one truck arrived to deliver shipments to all 10 stores? That would save:
- The retailer and the distributor transportation costs &
- The mall area congestion of 10 trucks and the CO2 emissions they create.
Recent examples of collaborative distribution systems show they can save up to 35% of transportation costs and eliminate x trucks on the road. Participating in a collaborative distribution plan will also improve your sustainability data.
Yes, the products delivered may compete with each other in the mall on the shelves, but they don’t need to compete for sales in the warehouse where they are stored awaiting shipment or in the truck shipment which delivers them.
Your own distribution warehouse may be in an area or campus with many other warehouses full of goods stored in anticipation of a shipment to the retail client. How many trucks a day take goods from the campus where you are located to the same locations?
Better supply chain efficiency for your own business and your competitors may actually come from collaborating on consolidating orders, truckloads and delivery points.
Of course, this type of transformation will take a lot of communication between all of the participants in the supply chain and the ability to share data.
Your Enterprise Resource Planning system will need to be able to rapidly create data feeds and reports which can support the planning and coordination needed to participate in a collaborative distribution infrastructure.
Is your system up to the challenge? If you need help to achieve this goal, please contact Socius for a review of what their Distribution 20/20 platform can do.