REGIONAL SPOTLIGHT: SOUTHWEST
Challenged by Capacity and Labor Shortages and Pandemic Supply Chain Bottlenecks, the
US Southwest is a Microcosm of Pandemic Supply Chain Challenges
Logistics and supply chain management dominate media coverage in the United States. And most of it is bad news. Typically invisible, logistics management has become daily news of labor and capacity shortages in all aspects of the supply chain, from materials and parts to equipment, warehouses, trucks, and drivers. Southwestern US DCA member company, States Logistics, has emerged to lead the 3PL sector in responding to these challenges, with a highly successful consolidation program branded as S.C.O.R.E.
Following is a recap of the program and its benefits for the CPG logistics ecosystem in the Southwest, with final commentary by the States Logistics’ executive team.
Predominantly serving the Consumer-Packaged Goods (CPG) industry, States Logistics manages inventory and delivers product to our nation’s largest retailers, grocery stores, drug stores, and mass merchants. As consumer demands soar, shipment volumes are up and logistics challenges for this sector may well exceed those of any other.
Because of service product planning and development underway well before the pandemic began, States has been able to deliver for its customer and emerge to lead the 3PL sector in addressing these unprecedented challenges.
The Southern California headquartered 3PL recently launched an exciting new initiative called Shipping Consolidated Orders for Replenishment Efficiencies, or SCORE. This program involves consolidating less than truckload (LTL) orders into a full truckload (TL) rather than multiple LTL loads going to the same destination.
The benefits are many:
Improved operational efficiency. While other retailers must deal with five different LTL carriers on any given day, States can deliver for five customers in one truckload for a given grocery, drug, or big box store, translating to less receiving time and paperwork, with simultaneous improvements in handling efficiency and reduced risk of damages.
‘Critical mass’ volumes translate to operations efficiency by lane. States created a dedicated customer service team for the SCORE service product and leveraging volumes across a base of ‘similar’ CPG customers moving to single retail destination, achieved essential ‘critical mass’ volume and efficiency levels, translating to new operational efficiencies and cost reductions by transportation lane managed.
Consolidated Loads by States, Carrier Partners Handle TL nationwide. In fact, the growth in consolidated shipment volumes has allowed States Logistics to shift management of these consolidated loads to their own drivers, at improved pay scales effective for the entire team and volumes that create operational efficiencies. Carrier partners now oversee the truckload (TL) freight, serving as ‘single stop’ providers for nationwide transportation and logistics. For CPG customers, this allocation of transportation management results in unparalleled ‘regional best’ service by States Logistics in its home markets of the US southwest and west coast.
Cost savings for CPG customers. By consolidating LTL shipments, States not only avoids the profound difficulties brought by the pandemic but can capture cost savings, which clients greatly appreciate in these challenging times.
“The consolidation process reduces damages, increases handling efficiency, and allows us to streamline our operation by establishing standing appointments with our clients. The net result of the SCORE program is that it enables us to move more consumer product goods to storefronts than any of our competition – at reduced prices for our customers and improved efficiencies for everyone.”
– Kirk Hellofs, VP Operations, States Logistics
Sustainability: fewer loads on the road. It is also important to note that shifting the same amount of volume to one single destination also reduces the number of trucks on the highway. For States Logistics, the SCORE program has proven that innovation and sustainability can easily go hand in hand.