A Single Corporate TMS Implementation is Key for Chiquita Express

Client Profile

In addition to being one of the world’s leading producers and distributors of bananas, Chiquita is a leading international marketer and distributor of many other fresh and processed food products. They offer a variety of fruits and vegetables, juices, beverages, packaged foods, salads, and fruit ingredients. Their bananas and other fresh produce are grown primarily in Central and South America. Chiquita-branded products are found in grocery stores in more than 60 countries, making Chiquita one of the world’s most recognized brands.

Their company’s commercial operation is a backhaul business developed to increase asset utilization for more than 9,000 Chiquita-owned containers, which need to get back to the port after the delivery of bananas to the customer. Chiquita’s Fresh Select business, distributing non-banana fresh produce such as melons and pineapples, moves in mostly LTL shipments.

In 2005, Chiquita acquired Fresh Express, the number one seller of packaged salads in the United States, with 40% retail market share and approximately $1 billion in revenues. Fresh Express is dedicated to providing healthy, convenient, and ready-to-eat spinach, salads, and vegetables. Fresh Express has brought fresh and nutritious salads to America’s tables for over 80 years. Fresh Express was the creator of the retail packaged salad category and the first to make ready-to-eat salads available to consumers nationwide. The combined transportation network is referred to as Chiquita Express.

Business Process and Problem Definition

Initially, Chiquita needed to consolidate three disparate legacy systems into centralized transportation command and control. Sourcing both strategically and for specific lanes was time-consuming and didn’t leverage the large annual transportation spend. They also wanted to maximize the use of the Chiquita-owned containers. With the acquisition of Fresh Express, Chiquita faced a series of issues relative to their TMS implementation. First, Fresh Express had a legacy-installed TMS package. Chiquita and Fresh Express needed to be converted to LeanTMS. At the same time, Chiquita decided to re-implement the entire company under one corporate structure. (Three corporate divisions had been implemented separately and as different companies with LeanTMS.)

LeanTMS® PROVIDED SCALABILITY FOR THE ENTIRE CHIQUITA CORPORATION AND FOR ITS TRADING PARTNERS

Process Improvement – SaaS Solution

Using LeanTMS®, Chiquita implemented four business divisions onto one system, supporting centralized planning and decentralized execution. This automated the RFP process and directly linked strategic procurement with tactical execution. Chiquita Express was able to automate routing guides for both the company and its customers, increasing efficiency.

With a single corporate implementation, LeanTMS provides visibility of all shipments for the entire Chiquita corporation and for its trading partners. There is also a single integration point for the entire company, simplifying inter-system communications. Asset utilization of the Chiquita-owned containers was increased through planning and managing container backhauls in the banana and commercial and other LeanLogistics customers for increased asset utilization. Chiquita achieved cost reductions in the Fresh Select business by utilizing the Private Transportation Market functionality to obtain capacity.

The Fresh Express division utilizes a forecasting system employing a two-stage commitment with their carriers. They commit to the shipment before the specific inventory is ordered, because quantities are unknown. When the inventory is allocated, a refinement of the shipment is sent to the carrier, providing them with specific details. LeanTMS provides them with the tools to manage this short lead time process.

Chiquita optimizes their shipment plan to create multi-stop consolidations across divisions for LTL shipments moving to the same destination and in the same direction. Chiquita implemented WebSettle® and consolidates payments to carriers from their multiple divisions. This means the carrier receives a single payment from the corporation (with an advice of which bills are being paid).

Value Delivered

The entire Chiquita corporation gained significant operational efficiencies by bringing all divisions onto a single transportation management platform and implementing common ways-of-working throughout all divisions.