It has been just over a year since the 3T managed transport solution went live at Kraft Heinz’s Wigan NDC and what a year it’s been. After a very long-term, third-party relationship, Kraft Heinz selected 3T to transform their distribution performance using their proprietary digital transport platform, EVENT.
Whilst there was the ever present need to reduce co2, cost and improve service, KH’s objectives for the new contract went far beyond those assumed benefits. The company needed visibility, it needed accurate, real-time data at a granular level to enable better decision-making and the ability to potentially differentiate service at a product and location level. It also needed to ensure a more resilient supply chain was in place. Like most companies using a 3PL operating model during the driver and supply chain crises of 2021/22, KH suffered the impact of over reliance on a single provider’s network and their available resources. Therefore, the new solution also needed to be sustainable because it delivered mutual value to all stakeholders, not just the shipper or the fleet operator.
Some industry observers may have regarded the KH decision as bold and risky, but Dominic Hawkins, Supply Chain Director Northern Europe, Kraft Heinz, was comfortable with the operating model and knew it could work. Plus, 3T’s track record of digitally transforming the logistics operations of customers like JCB and Honda, gave him every confidence it could be achieved.
So, one year on, how has it gone? “It can only be described as a very successful first year,” says Hawkins. “Our Requested Delivery Day (RDD) performance has increased significantly and is now at a consistently high level. We have received praise from our customers on our delivery performance and the reduction in additional administration; ‘best in class’ is one which stood out for me recently.
In addition to our service improvements, we have also reduced the number of vehicles used to distribute Kraft Heinz product to our customers. This has been achieved through better planning and vehicle utilisation courtesy of the 3T EVENT platform and the expert team which oversees it every day. This has had the twin positive impact of directly reducing CO2 – less vehicles equals less CO2 – and less vehicles required means less cost, with a flexible multi-carrier model employed. Vehicle fill efficiency has been increased from 20 pallets to 22 in the last nine months, which is great to see.”
So, how has this been achieved? Matt Garland, Kraft Heinz Account Director at 3T adds, “Of course, the industry leading technology in the form of the 3T EVENT platform is central to optimising the order to pay process, but it is more than that. It is the existence of a single version of the truth, the accurate data! With a transparent view of the operational metrics, agreed by all three parties, Kraft Heinz, Wincanton’s warehouse team and 3T, means we can collaborate and work together to find solutions and exceed the customer’s expectations, after all, we all want to know that bottle of Heinz tomato ketchup, or HP sauce, if that’s your preference, will be there the next time you go to your local supermarket!”
The multi-carrier operating model has also been fundamental to the success of the contract. Rather than adding cost margin and risk as the work exceeds a fleet, the multi-carrier model provides direct access to the carriers best placed to provide the service to THAT customer, at THAT time, on THAT given day. It utilises the backbone of the U.K. transport industry, our regional carriers, the firms operating from 10-250 vehicles, very well, every day. The flexibility of being able to use a virtual network from across the country provides both service and cost flexibility. The complications of managing more providers does not generate more work with 3T’s platform though, instead the automation makes this as simple as using a single provider, so it’s the best of both worlds and it also disaggregates the risk in the supply base.
So, what’s next? “The granular SKU level data available to the teams means we can now start to ask more “why” questions and challenge long held beliefs and parameters. The ability to work far more dynamically and at a much greater level of detail, without a spreadsheet in sight, will enable Kraft Heinz to be more flexible and responsive to both customer, consumer and market demands and changes in the future”, states Dominic.
But it goes further than that. The 3T platform can facilitate wider multi-customer and multi-carrier collaboration, extending the digitalisation further up and down the supply chain, and in turn provides the opportunity to share transport capacity and reduce the amount of empty running and increasing driver productivity, thus going some way to reducing the risk and potential impact of future driver crises and capacity constraints. “We all know there is so much wasted vehicle capacity out there” says Rob Hutton, Chief Sales Officer at 3T. “Until now the isolated nature of data has meant it is hard to make that collaboration opportunity visible to shippers and operators alike. Until now, our EVENT platform can change the industry and make a huge impact on co2 reduction, we just need more forward-thinking organisations like Kraft Heinz to get on board and we can prove our industry can clean up its act!”
