Do cookies or muffins weigh more? It’s a quarter million dollar question
It’s decision time. You’re at your favorite bakery staring through the glass case looking at all the sweet treats waiting for you to enjoy. You ask, “Should I get cookies or muffins?” Well, do you want a soft, flat, gooey cookie, or a round, fluffy, fruity muffin? It’s a tough call. One question you are probably not asking yourself is which one weighs more. It’s a question we recently asked one of our managed services clients when diving into their upstream supply chain. Turns out it was a quarter of a million dollar question.
Looking for Savings One Lane at a Time
Our managed transportation services department recently started working with this food and bakery client to manage its transportation and find savings throughout its supply chain processes. While evaluating inter-plant lanes in their network, we noticed one lane in particular was losing money—despite achieving a substantial reduction in per load rate during a recent procurement event.
The company has a diverse product base so when diving into the raw data, we started looking at the commodity information. There was a shift in the amount of cookies being shipped in favor of more muffins. Muffins weigh less than cookies, so it caused a drop off in per load weight. This was important information to consider because it changed the constraint in the order planning process. Previously, planners filled the truck based on a weight constraint, now they needed to fill based on volume.
The Cost of Moving Air Down the Road
Not adjusting planning methodologies left 30 percent of the truck underutilized, which meant the company was paying $200 per load to move air down the road. Over the course of a year, that adds up to $240,000 lost to empty space. Load planners changed their constraints and filled the trucks by cube volume instead of weight. Not only were trucks moving product at full capacity, but it also lead to a reduction in the number of loads shipped overall which saved even more money.
Muffins Moving More, Company Saving More
It’s been about one full month since the changes were implementing and the results are just as we predicted.
- Cost per load continues to drop
- Average weight has jumped dramatically
- The company has experienced a lower Cost Per Hundred Weight.
- For the first time this year, the lane is in the blue.
This was a big win for our customer and for our team. Our logistics planners and analysts are always searching for savings, digging deep into the data, and in this case, following a trail of crumbs that lead us to the source of the problem. That’s how we are building better supply chains together.
LeanLogistics’ Managed Transportation Services helps companies reduce empty miles, fulfill backhauls, manage inbound shipments, and reduce overall transportation spend through continuous moves and optimization. Want to know more? Watch this video to see a day in the life of a LeanLogistics MTS team, or email questions to firstname.lastname@example.org.
Tagged lane savings, LeanLogistics, managed services, managed transportation services, planning process, product base, Supply Chain, Transportation, upstream supply chain, weight constraint