EnsuringProductIntegritythroughCost Effective, EfficientandReliableFoodSupply Chain

Vishal Sharma VP Operations RKFoodlandPvt Ltd

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Preview
AboutRadhakrishnaFoodlandPvtLtd DriversofSupplyChain SupplyChainManagementBenefits SupplyChainChallenges CaseStudiesQSR&Retail

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RadhakrishnaFoodlandPvtLtd (RFPL)

30Oct12

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AboutRFPL
30+ yearsexperienceinsupplychainbusiness
NationalWholesaleBroadlineDistribution(NWBD) RetailChainofConvenienceStore FoodlandFresh FreshCategory FFV,NonVeg,Bakery Staples

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AboutRFPL
ColdChainExpertise Pioneeredeffortsintransitioninginstitutionalfoodservices industryfromunorganizedtoorganizedsector Managedover30000 peopleatmultiplesitesPanIndia IndustryandSectorExperience Learningbydoing Longtermstrategiccollaborativerelationships PANIndiapresence
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PanIndiapresence
TotalFleetSize 275(owned/leased) TemperatureControlled 137 Reachingoutto66 majorcities Nearly1000 distributionpoints Approx.800 vehiclesoperated Owned/leased Vendormanaged

Foodland TheBrandBehindSuperBrands

SupplyChain Solutions

Warehousing

Transportation &Logistic Services

ValueAdded Services

Project Management

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SomeofOurClients
FMCG

Retail QSR FoodService Pharma

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FMCGSUPPLYCHAINEXPERIENCE
MotherWH Depots

SubContract Unit

Distributors

Factory

Retailers

RawMaterial

Consumers

RETAIL&QSRSUPPLYCHAIN EXPERIENCE
SUPPLIERI SUPPLIERII SUPPLIERIII

DISTRIBUTION CENTRE

STORES

STORES

STORES

RFPL WAREHOUSEMANAGEMENT

Kalamboli DC

Noida DC

RFPL WAREHOUSEMANAGEMENT

Kalamboli DC

Noida DC

FoodlandsWarehouseManagement
ProvideShared/Dedicatedfacilities ManageMultiTemperatureproducts Optimizeefficiency inventorycontrol Safety&SecurityofStockandAssets Forecasting&Scheduling

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FoodlandsTransportManagement
FleetDevelopment&Management Routing&Optimization ShipmentTracking FreightPaymentAccounting Inspection&Reportingonreceipt

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FoodlandsValueAddedServices
InventoryManagement ReverseLogistics CoPacking/PackingDesign RetailSolutions ITImplementationandIntegration PromotionalSupport

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FoodlandsProjectManagement
SolutionDesign TechnologyImplementationandSupport PropertyManagement Material/MachineryProcurement IndustrialRelations

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FoodlandsUnitManagementSystem
MOBILISATION AUDITS

TRAINING

Brand Protection

TECHNOLOGY

PEOPLE

COMMERCIALS

S
REVIEWS
S
E

TOOLS

CUSTOMER DELIGHT

ITC

OPERATIONS

M
Business Continuity

KRA / KPIs

REPORTS

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FoodSupplyChainDrivers

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DriversofSupplyChainPerformance Inventory Facilities

Transportation

Information

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DriversofSupplyChainPerformance
CompetitiveStrategy

SupplyChainStrategy Efficiency Responsiveness

SupplyChainStructure

Inventory

Transportation

Facilities

Information

Drivers

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DriversofSupplyChainPerformance Inventory
RoleofinventoryintheFoodSupplyChain: o Anticipationoffuturedemand
o Productionanddistributioncostsreduction
Economies ofscale

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DriversofSupplyChainPerformance Transportation
RoleoftransportationintheFoodSupplyChain: o Transportationmovestheproduct betweendifferent
stagesinaSupplyChain
Transportationchoicesimpacttheresponsivenessandthe efficiencyoftheSupplyChain

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Transportation Efficiency
ImproveRouting
EnsureFulltruckloads Driveshorter,safer&smarterroutes Reduceoutofrouteexcessmileage

ReduceEmptyMileage
Increasevendorbackhauls Optimizenetworkdesign

DeployInnovativeTechnology
Enhancedispatchingtools Visibilitythroughdashboards

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Transportation Efficiency
TrucksFillProcess:
Adjustpallet&truckcapacities Clubdeliverydaystogether AdjustDeliveryFrequency AdjustTruckconfigurations ImproveSystems Educatelocalrouters

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Transportation Efficiency
PerfectTrucks: TruckTrackerArchitecturewithoutput
KmReport TruckloadabilityReportfromfacilities ExceptionReport Routedeviationfrequency ColdChainCompliance Transporterwisevolume&Value

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Transportation EfficiencyMeasurement
No.ofPERFECTTRUCKsinaMonth
OK
>90% Truck Utilization

Not OK

A PERFECT TRUCK
Truck followed the Route

Trucks AC Worked on the Route

Truck reported back within TAT

Truck delivered without Damage/Shortage

A Truck with all parameters Green is a Perfect Truck

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DriversofSupplyChainPerformance Facilities
RoleofFacilities intheSupplyChain: o Whereinventoryistransformed intoanotherstate
ManufacturingFacility o Whereinventoryisstored beforebeingshipped WarehousingFacility
Choicessuchasnumberoffacilitiesorcapacityimpactthe SupplyChain

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FacilityEfficiency
EnergyEfficiency
o Morenaturallighting o Reduceelectricityconsumption

DieselConsumption o Auto Cut o ReduceOverCapacity o ReduceRentals o PreventiveMaintenance:Filtercleaning, Changing,EngineDecarbonizingetc

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FacilityEfficiency
LaborProductivity
o ImproveFacilityLayout o A,B,Cclassification&arrangement o Seasonalstockarrangement

Automation o PalletizationandHOPTsandBOPTs o Lift/ConveyerBelts

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FoodSafety &QualityManagement
QualityAspect
ColdChainManagement BatchLevelTraceability CertificationProgramme ContinualImprovement Programme Compliances

Benefits
Productintegrity&qualityassuredandthus brandprotection AbsolutestockcontrolthusensuringFEFO, reducingthepickingtime,controlsWET Ensuresthatpeopleareaware&havethe relevantknowledgetodeliver Systematicapproachtowardsmeasurable KPIs/SLAs.Thus,Ensuringcontinuous improvementoftheoverallsystem Ensurescompletebrandprotection&business continuity

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FoodSafety &QualityManagement
QualityAspect
ContingencyPlanning Security&AccessControl

Benefits
Ensuresconsistentsuppliesevenincaseof naturaldisastersorothercrisissituations Preventssabotageandtamperingofproducts andcontrolsWETaswell

ForeignMatterControl& CustomerSafetyandthusprotectsbrand image Hygiene PreventiveMaintenance

Ensuresthattheequipmentsareworkingin thebestconditionandtheoperationsarenot hamperedbybreakdown Verifythelevelofexecutionofprocesses, accuracyofdataandlevelofachievementof targetsandpromotesimprovement

InternalAudits

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AUDITS
External3rd PartyAudits ISOAudits DQMPAudits CSRAudit ClientAudits HalfYearly Yearly Yearly Asperschedule

InternalQualityAudit

Quarterly

DriversofSupplyChainPerformance Information
RoleofInformationintheSupplyChain: o Servesastheconnection betweentheSupplyChains
variousstages(allowscoordination ofactions) o AllowsdailyoperationsofeachstageoftheSupply Chain(ex.:aproductionschedulingsystemneeds information)

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ITasanEnabler
Time TemperatureIndicators eSCMbasedoninternet,GPS&GIS DecisionSupportSystems(DSS) eMist(ElectronicMISforTransportation) KPIDasboards

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InformationTechnology
Platforms RAMCOMarshall SAPR3/ISRetail,BIW EPOS(RetailStore) DRIVE(Transportation) IBMLotusMailSolution GPSsolution
CDMA/GSMlinkedtoSatellite

Since1998 Since2006 Since2006 Since2007 Since2008 Since2007

AdoptedtoClientERPSoftware o PepsiCo (SAP) o Bharti WalMart(MGDS)

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RFPLprovidesClientwithSeamlessand RealTimeSupplyChainVisibility
SeamlessandRealTimeSupplyChainVisibility

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FacilityScorecard KPIs
Bucket KPIs KPIBenchmark BucketScore Benchmark RFPLguarantee Attrition% Costofrecruitment PeopleManagement Costoftraining Manpowercost Voiceofemployeesurvey Inventoryaccuracy Manpowerproductivity Warehouse Putaway/pickingefficiency/accuracy Management Warehousingcost WarehouseShrinkage Freightcost TransportationShrinkage Transportation Management Transportationcost Vehicletypeandutilization Customercomplaints IssueresolutionTAT OrderprocessingTAT CustomerManagement OTIF(MT/TT) Voiceofcustomersurvey CRScompliance Delay/ErrorinMIS MISManagement CompletenessofMIS Productavailability and RangeavailabilityatRD integrity Stocksfreshness
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ConsiderationsforSupplyChainDrivers
Driver Efficiency Responsiveness

Inventory

Costofholding

Availability

Transportation

Consolidation

Speed

Facilities

Consolidation/Dedicated

Proximity/Flexibility

Information

Whatinformationis bestsuitedforeachobjective

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SupplyChainManagement Benefits

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SupplyChainManagementBenefits
ReductionofSCcosts o Nontransportcosts o Transportcosts Lowerinventories Improveddeliverytime Improvementinservicequality

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SupplyChainChampions: Servicevs.Costs

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Source:McKinney&Institutefor supplychainmanagement

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SupplyChainChampions: Costvs.Performance

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Source:McKinney&Institutefor supplychainmanagement

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Apictureisbetterthan1000words! Howmanywordswouldbebetterthan3pictures?
Asupplychainconsistsof
Supplier Manufacturer Distributor Retailer Customer

Upstream

Downstream

aimstoMatchSupplyandDemand, profitablyforproductsandservices achieves SUPPLY SIDE DEMAND SIDE

The right

Product

+ + + + +
The right The right The right The right

The right

Price

Store

Quantity

Customer

Time

Higher

Profits

SupplyChainChallenges

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Challenges
OperationalChallenges QualityInfrastructure SeasonalImbalance Manualloading/unloading Lowefficiencyreferunitsforvehicles Practiceslikeshuttingoffreferunits

StructuralChallenges Realcostofdoingbusiness

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TotalCostofOwnership
Keyareasthatweimpactasserviceproviderandoutcome ifwefailtodeliver
ONTIME
Lossofsaleformaterialnotreachingontime Additionalovertimeofcrewwaitingtounloadingthematerial Stockoutatstores Lossofsaleanddropinfootfall Lossofopportunitytodelightcustomerandimpactonbrandimage Dropinyieldoftheproduct;morewastagesatstores ChancesofstockgettingHOLDatstoresleadingtolossofsale Dropingrossmarginatstoreandlossofincentiveforteams Coulddelaytimeboundpromotionsplannedatstores Opportunitylosstogeneratehighsalesduringfestivals Lossofsaleandimpactduetoinventorycarryingcosts
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INFULL

Qualityofproduct

Promotions

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Casestudies

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CASESTUDY RETAILDC OPERATIONS

DCserves 104Retail stores 40(3refer+ 50(3refer+ 37dry) 47dry) Dedicated Dedicated vehicles vehicles Average Dispatchesper day: 1200 cases DChandles 8000 SKUs Dedicated Teamof477 People

WorldsLargest RetailersDC: 85000sqft

Pickingefficiency 45linesperhr Fillrate 99.5%

Average Productivityof receivingdock: 4casespermin

KPIimprovements last3~5years
DCcontrollablecostas%ofsales
8 6 4 2 0 2008 2009 2010 2011 2012 500 450 400 350 300 250 2010 2011 2012

DCsales(cr)

Auditscore 96(2012)

86(2010) Fillrate 98.7(2012)

Productivity(cpmh)
13 11 9 7 5 2010 2011 2012 120 100 80 60

Noofstorescovered

93.8(2011)

2010

2011

2012

KPI

shrinkage(%)
0.4 0.3 0.2 0.1 2010 2011 2012 98.5 98 97.5 97 96.5

pickingaccuracy(%)

Cost
2010 2011 2012

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ValueadditionbyRKFoodland(2011vs.2012)
DCsalesincreasedby31% Costtosalesreducedby26% Productivityincreasedby40%(10.8vs.7.7) Averagestockinstoreincreasedto94% AverageDCfillratesincreasedto98.7%from93.8% DCdamagesreducedby50% APauditscore 94%;Externalfoodsafetyaudit 96% Foodlandauditscore 89%(QHHSSEMCC) 51%morethroughputthananyothersimilarDConapersqftbasis
Consolidationcenter operations Startedin2012 13vendors(27more inpipeline) 6stores 97%fillrate

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BirthofConsolidationCentre(CC)
HowwillIsupply suchasmall LoadtoRetail Store? Vendorsnotsupplying ontime!!MyShelvesare emptyandIamloosing onSales.HowwillI resolvethisproblem???

Vendors Retailer

WhatisConsolidationCentre?
A Consolidation Centre (CC) is a warehouse dedicated to receiving, staging, and dispatching (or transporting) material to a specific geographic location, development, or district. Its primary mission is to enable combination of discrete shipments into fewer, more efficient deliveries.

HowtheConsolidationCentreworks?

CASESTUDY QSR
Supplychainoperations
InfrastructureCreation
DistributionCenter Refer&DryVehicles Longtermassociation

ValueAddedServices
PurchaseOperations InventoryPlanning OrderManagement HandlingFreshProduce Updatingpricemaster VendorPayments Preparingannualbudget Audits Trainings Handlingpromotionalitems HandlingOPS&MNRitems Newlaunchsupport MonthlyMIS NewStore/routesurveys
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DCOperations
Receiving Storage Stocktransfer/intercompany sale

Transportation
Inbound&Outbound Normal&Dynamicrouting StoreScheduling

CASESTUDY QSR Supplychainoperations

EndtoEndSupplyChainOperations
DemandForecasting,Ordering,warehousing&transport(primary&secondary) Promotion/Eventhandling Supplier&StoreOrderProcessingincludingPayments InventoryManagement

256 stores
121 NE 135 SW

Associated since1996

36 major suppliers

89 Dedicated vehicles Develop& retain talent

WorldsLargest QSR

490SKU
250Food/nonfood 240Ops

13000+ outbound tripsayear

OTIF 87% Fillrate 96%

Lower costs

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Scope ofActivities
DistributionCentre Maintaininventorylevel Racking&storage Handlingequipment Trainedmanpower ISO,DQMP&Statutorycompliance ITsupport Valueaddedservices Delivery Adequatefleet Temperaturecompliance Backupforbreakdown Turnaroundtime ReverseLogistics

AtStores NoStockouts Adequatespace TrainedManpower Zeromachinedowntime

Our objective

100%
Customer Delightat store CustomerService OrderCollection&Processing Storescheduling&routeplanning Reconciliationwithstore Productrecall VendorSupport Sticktoproductionscheduleto honourdeliveryschedules. Maintainadequaterawmaterial inventory Temperaturecompliance Scheduleddowntimefor machines
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ImperativesforBusiness
(ManagementCommitment) BusinessForecast ExpansionNewstores/cities NewSKUlaunch Integratenewvendors&locations Agreedservicelevel Infrastructure(facilitysetup, trucks&equipments) Resourcedeployment Financialcapability/workingcapital Licensesandregistration 56

InventoryPlanning Monitorsalestrend Stockreplenishment TimelyplacePurchaseorders QIP/GRN/SOCPreparation

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QSRSupplyChainEffectiveness Measures
WarehousingManagement
Warehouseproductivity InventoryDaysonhand Value/Quantity Rentalspercase

TransportationManagement
OnTimeDelivery% TruckSpaceUtilization% TransportProductivity FuelEfficiency(Kms /Litre)

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LiveTracking

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Locationwiseinoutreport1

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LogisticsStandards
DQMP(DistributorQualityManagementProcess) OperationsandCustomerRelations(OperationsManual) QualityControl(HACCP/QIP) ColdChainstandards Hygieneregulations Producthandlingstandards Emergencyandcontingencyplans Risk&Crisismanagement Continuousunannouncedinternaland3rd partyauditsforDCsresultin superiorqualityscoresregularly.

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InventoryManagementisakeyenabler

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Synchronizationdeliverssignificantbusiness benefitstoboththecustomerandthesupplychain
Enablers
Onestopshoppingconcept Inventorymanagement Centralfilemanagement Restaurantsimplification

SynchronizingtheperishableSupplyChain
Demandforecasting
Promotional+ContinuousSupply RestaurantandDClevel

SupplyPlanning
RestaurantandDClevel

VisibilityandCollaborationacrossthechain

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Strategyforefficiencies
Cust DC:

integrated

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Powerofonebenefits
Profits Overheads Warehousing Profits Overheads Transportation Profits Overheads People/labor Management Profits Overheads Network Management Profits Overheads IT/MIS Management

COSTSAVINGS

C O S T

D U P L I C A T I O N

Profits

Overheads
Warehousing Transportation People/labour Management Network Management IT/MIS Management

OneManagementTeam Multiskilling Drivesinnovation EliminatesInefficiencies

TRADITIONALSERVICESMODEL
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Thank You

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