Fresh supply chains can be complex, but it is possible to streamline processes and squeeze more savings out of your supply chain. If you’re currently shipping less than truckload (LTL) or underutilized truckload freight, a retail consolidation program is one solution suppliers and retailers alike can use to add strategy and value to fresh supply chains.
Retail consolidation programs at a glance
Simply put, a retail consolidation program combines shipments to make the process simpler and more efficient. It can also help suppliers meet retailers’ compliance programs.
Retailer compliance programs are unique to each company. They specify how suppliers must set appointments, maintain on-time delivery performance, and deliver in full—activities that help the retailer improve efficiency, lower inventories, focus on an omni-channel approach, and respond most effectively to consumers’ demands. These programs rely on having product available when and where consumers want it.
A retail consolidation program helps meet the standards set forth in a compliance program and eliminates unnecessary waste and expense from the supply chain.
How a strategic retail consolidation program works
In retail consolidation, a consolidator has an order level solution for LTL shipments—one that spans across multiple suppliers all delivering to the same retailer. Most programs include a consistent shipping schedule and alignment with lead time and retailer delivery expectations. The program should be fully compliant with the retailer’s expectations—from ordering patterns, to appointment scheduling requirements, to on-time performance measurements.
For example, if dock space is limited, a regular schedule through the consolidation program eliminates the need to accommodate pickups of small order quantities from multiple transportation providers.
Based on consolidation delivery schedules, LTL or partial truckload shipments can be sent. Once ready to move, products are sent to a consolidation center, where they are optimized with deliveries from other shippers and delivered to retailers in time to meet tight delivery windows.
Top benefits of retail consolidation
Retail consolidation programs may improve the speed of delivery, but it’s not the only benefit. Retail consolidation can bring alignment with specific compliance initiatives, improve on-time delivery performance, and add connectivity across supply chain partners (think manufacturing, suppliers, transportation providers, consolidators, and retailers). It’s also a solid cost-saving initiative for LTL/order level business. Many shippers also discover a reduction in total lead time, which in turn can reduce inventory carrying costs.
And, products moving more quickly off the books on a prepaid basis can result in an improved cash-to-cash cycle that leads to profits. These benefits can also increase the ability to precisely address the metrics used to gauge performance, which leads to fewer missed delivery appointments and reduced out of stock incidents.
Is retail consolidation right for your business?
Shippers currently using LTL, partial, or underutilized truckload service stand to gain the most from a retail consolidation program. If you can answer yes to one or more of these questions, a retail consolidation program may be the right opportunity for your business.
- Do you need to improve compliance levels?
- Have your transportation costs been increasing?
- Is your bottom line affected by out of stock items or compliance fines?
- Do you regularly schedule retail deliveries to multiple distribution centers?
- Is a lack of expertise, technology, or visibility negatively affecting communications?
- Do your shipment sizes and purchase orders vary?
- Would preferential appointment status help speed up your deliveries?
- Would you like your providers to have subject matter expertise specific to you?
The key to a successful retail consolidation program is high volumes of shipments, which is why retail consolidation works best when handled by an experienced consolidator that has substantial experience within the retail industry. This knowledge helps your consolidator understand your requirements, initiatives, and behaviors.
Robinson Fresh can help you begin or enhance a retail consolidation program. And, because we operate globally, we have significant volumes to make consolidation efficient for you. Our experts understand compliance requirements, and we can add connectivity between retailers and suppliers—from appointments to business intelligence. Finally, we are able to provide global technology that helps simplify your transportation, reduce dock congestion, and increase visibility into your products in transit.
Contact one of our supply chain experts today to get started on your own retail consolidation program.