Tankering Solution Saves Bottler up to $1 Million per Day in Lost Production During Disruptions
SOLUTIONS THAT SHIP
REFRESHING INNOVATION
MODE Global, partners with a $3.8B bottler of well-known spring-fed and purified water brands. The company has 7,000 employees and operates a network of manufacturing facilities and storage warehouses located in all regions of the U.S. and Canada.
The bottler fights it out in the hyper-competitive water aisle and has a unique production risk it must always anticipate When springs dry up or storms contaminate water sources, it can become a $1 million-a-day problem if production is disrupted
Demanding customer service expectations and ever-present production risks test MODE’s processes, resources and problem-solving ability. Our ability to rise to the bottler’s challenges has led to a 10-year relationship and 8,000–10,000 shipments a year.
CHALLENGES
A leading bottler needed a responsive, food-safe process for switching water sources when springs failed
Complying with large retailers’ appointment schedules was difficult for this growing company
The bottler was challenged to scale its operations without sacrificing the personal touch that supports successful retail relationships
SOLUTIONS
Created a program to tanker in water and keep production going when springs failed
Built a roster of drivers trained to respond to tankering needs within 12 hours
Took over inbound delivery of raw materials to control their supply chain and save by switching from freight prepaid to freight collect
Consolidated truckload (TL), tankering, less-than-truckload (LTL) and inbound to one contact and one platform
Expanded capacity through MODE Global’s network of 50,000 active carriers and more than 3,000,000 pieces of equipment
RESULTS
98% on-time performance, up from low 90s pre-MODE Global
10-12 tanker drivers trained and certified to respond to customer’s needs
$1 million per day in potential costs avoided through on-call tankering program
Hundreds of thousands of dollars saved in chargebacks annually
Created KPI goals based on most stringent retail customers’ standards
Supply Chain Challenges
Production disruptions create a $1 million a day risk. When storms contaminate water sources or springs dry up, the risk of idle production lines and truckers as well as fines for late or missed deliveries quickly mount Future business and accounts themselves can also be lost as retailers switch brands to avoid empty water shelves
“We have the systems, the process and the experience to help growing companies navigate large retailers.”
Sean Hizey, Vice President, Business Development, MODE Global
Available options when springs closed down were undesirable. Prior to MODE Global, the company would tap into other production facilities which necessitated longer, more expensive hauls; if other production facilities were not available, the company would often have to dip into emergency inventories held back for natural disasters and humanitarian aid, which depleted their backup stock.
Hauling bottled water has added cost pressures. Beverages create heavy loads, but water has the added burden of being a cheap commodity Experience pays especially when there is a need for special permits and driver certifications in certain states The pressure to maximize pallets in order to reduce the cost of goods can also lead to safety issues and driver resistance
Large retailers have stringent routing guides that vary. Our beverage customer was a growing brand expanding into big box chains. Navigating delivery appointments, pallet configuration rules and more is confusing, and mistakes led to chargebacks and strained retailer relationships.
Lack of control over inbound shipments of raw materials. Deliveries were previously handled by the shippers. This can be risky. Delays in the delivery of plastic preforms, which are heat-formed into bottles on-site, can shut down production. In addition, pre-paid inbound freight was handled by sellers who marked up shipping rates.
Need for a centralized carrier source. The brand was shipping product to leading retailers everywhere in the U.S. and Canada. To streamline visibility and communication, they needed one point of contact for all their shipments, including truckload and LTL as well as their inbound shipments and tanker loads.
Why MODE
Transportation contributes significantly to the cost of goods of bottled water. Consequently, low costs were the initial draw for the customer. After more than 10 years, MODE Global has continued to add value by cutting costs and containing expenses.
Additionally, the bottler has benefitted from MODE’s personal customer service and regimented process-driven operation. As the bottler has grown, technology and skilled team members have enabled MODE to scale the company’s operations without losing their personal touch or business continuity along the way
In every phase of their development, the water company has benefitted from MODE’s range of services and dynamic solutions like MODE’s tankering program
MODE’s Solution Set
Supply chain solution created for serving large retailers. MODE provided the systems, process and experience to create a customer-centric approach that helped the bottler navigate the large retailers they were trying to do business with.
Network of 50,000 carriers provides truckload capacity. MODE draws from its expansive network to find carriers with beverage experience for the bottler. Special care is required, and familiarity with the retailers and sites being delivered to reduces costly mistakes MODE also has the capacity the bottler needs to respond quickly with trucks to haul tankers in emergencies.
Extensive truckload capability enables on-call tankering. MODE created a roster of qualified, experienced truckload drivers for the bottler and arranged for a select number of them to be trained to haul the beverage company’s tankers as well. Certified drivers with suitable tractors are ready to respond in 12 hours.
Dedicated account management drives customer service. The bottler has a dedicated account management team with an intimate knowledge of the water brand’s business needs. This gave MODE the ability to create a regimented process-driven operation with a customer service team providing personal support.
An enterprise account team that leverages experience with large retailers. The bottler is assigned a team familiar with scheduling appointments with major retailers. Their shipments are supported 24/7 by a robust dispatch and tracking process. We use our most stringent retail customers’ performance expectations to set our standard for how we operate for this bottler and every other customer.
