unloading predictability. agenda objectives approach landscape challenges open discussion

Unloading Predictability

Agenda

• Objectives• Approach• Landscape• Challenges• Open Discussion

Objectives

• Document recommended unloading practices and evolve a whitepaper that can be used as a tool to approach a more efficient unloading process in a fair and equitable manner, inclusive of fair cost sharing recommendation

Approach

• Survey of retailers, wholesalers and manufacturers exploring current processes and initiatives

• Interviews with retailers, wholesalers, manufacturers and service providers

Landscape

Landscape

• History• Current State• Future Challenges• Key Initiatives & Challenges

Landscape

History• Delivered terms include “sort &

segregate”• Deregulation in 80’s eliminated ICC

maintained “store door delivery charges”

• Increased incentive for driver to “outsource unload”

• Spawned unloading service concept and need to manage unloading costs

LandscapeCurrent State• CPU is increasing but Pre-Paid still

predominant• Pre-paid load cost includes COGS,

Transportation and unload allowance• “Rebates” absorbing retailer support

costs add complexity• Retailer retained unload service

creates independent cost calculation and reconciliation process

Landscape

Future Challenges• Increasing load complexity as

retailers – Expand channels – “Localize” assortments– Introduce tailored product flows

• Impact of increasing “efficiency” programs bundling incentives & blurring visibility

• Evolution of “collaborative profitability management” supported by CTS solutions

Landscape

Retailer Intiatives• Demand forecasting• Collaborative planning• Enhanced flows

Retailer Challenges• Increasing SKU count• Increasing breakdown• On-time delivery

Supplier Intiatives• S & OP• Store based demand

planning• Inventory optimization

Supplier Challenges• Unloading cost

variability• Timely unloading• Increasing load

complexity

Challenges

Challenges

Unloading Cost Calculation• Unloading labor– Precisely calculable– Impacted by “exceptions”• Environmental• Business driven

• Overhead absorption– Tougher to calculate– Highly variable

Challenges

Issues impacting unload productivity

• Program driven procurement decisions

• Appointment scheduling• Drop-trailer programs• Flow requirements• DC configuration

Open Discussion

Discussion Topics

• Can we agree on industry wide processes for identifying and then calculating labor expense associated with unloading different load types?

• Can we Agree on a way to reflect “exceptions” and decide whether exceptions are a valid expense to be shared between trading partners?

• Can we agree on what fixed cost elements are fair to be included as part of a “rebate” component of the unloading allowance?

Discussion Topics

• How is unloading cost & effectiveness impacted by broader efficiency programs and are there suggestions for enhancing programs to drive mutual benefit?

• What process, system, organization and/or infrastructure enhancements would drive increased unloading efficiency?