Global Logistics and Supply Chain Strategies - October 2008 - (Page 61)

ple, we don’t just have visibility from its vendors to its DC. We’re looking at Wendy’s at the same time. In fact, we’re looking at our entire network at the same time because many of these chain restaurants use the same distributors and same vendors, right. So, in some cases we’re putting Wendy’s product on the same truck with Church’s products. What we strive to do is build full truckloads as efficiently as you can.” Aggregating these multiple networks has resulted in a 20 percent saving or so over the original freight cost, says Mullen. That’s important because, as in all verticals, restaurant supplies have steadily risen in cost, and significantly so in the last year. Still, a balance has to be maintained, Mullen says. While the industry deals with many frozen-food items, many others need to be fresh. The challenge for the industry is to have the right amount of fresh food on hand or in a delivery truck on its way. Success turns on timely and accurate information. “There’s a balance there,” he says. “I want as little inventory as possible, because it’s expensive, but I have to serve my customers with the right product at the right place and time.” Clearly, promotions can skew things, and purchasing, replenishment and distribution all depend on what the procurement department knows and when it knows it. The OnDemand solution has a Limited Time module designed for promotions that are likely to cause sales spikes. Limited Time has real-time visibility into how sales are proceeding. While not a true forecasting tool, nevertheless it collects historical data that can be used in planning. “With it, I can see how much product goes to the back door of the restaurant and understand just how well the promotion is going from day one—oh, it’s not going well in New England, but very well in the Southeast—so, I’m going to manage my inventory and my procurement for this promotion based on how well these sales are going.” The pain points for Church’s Chicken centered on the need to automate its order and receipt entry to put an end to food cost accounting inaccuracies. But the retailer also needed to synchronize information between suppliers and its internal ordering system. OnDemand has integrated all of these links in the network. Mullen says the order management module has reduced invoice error rate at receiving to zero. What does cutting out 500 man-hours a month mean? Mullen estimates Church’s savings at $400,000 a year in productivity. He says another client, Arby’s, has had more than a 300 percent increase in new SKUs, “and the ease with which they’ve done that without adding people is significant.” Applebee’s franchisees are recovering $1m million a year in overcharges “that have the potential to exist in their system, and they’ve done that with pricing audits” made possible via OnDemand. In general, Mullen says, restaurant chains can reduce overall food costs typically by as much as two to three percent. All in real time. No waiting. To access this article online, visit The Digital Edition at www.SupplyChainBrain.com. Resource Link ArrowStream, www.ArrowStream.com www.SupplyChainBrain.com GLOBAL LOGISTICS & SUPPLY CHAIN STRATEGIES 61 http://www.SupplyChainBrain.com http://www.ArrowStream.com http://cratersandfreighters.com http://cratersandfreighters.com http://www.SupplyChainBrain.com

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Global Logistics and Supply Chain Strategies - October 2008 Contents Editorial GL&SCS Exclusive Fastforward Up Front The Top Story In the Driver's Seat Think Inside the Box Recipe for Success NITL Preview Opinion Industry Voices

Global Logistics and Supply Chain Strategies - October 2008

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