Unit Price vs. Total Cost of Ownership: When Service and Quality Prevail
Muller Load Containment Solutions optimizes pallet wrapping procedures for wholesale grocery distributor
Across the United States, millions of consumers rely on their local supermarkets, specialty and convenience stores for fresh and pre-packaged grocery items. Wholesale grocery distributors ensure those consumers get what they are looking for. But satisfying thousands of stores involves huge warehousing and manufacturing space spread out across various regions.
Recently, a wholesale grocery distributor took its commitment to quality products and service to a new level. While it was evident throughout the company’s supply chain that quality products and unparalleled service were paramount, the company looked for ways to streamline efficiencies and prevent damaged goods throughout its supply chain. In came Muller LCS.
Over the course of four years, Muller would supply machine and hand film to all the company’s distribution centers. While film quality was critical to this expansion, it was the service, implementation and results that sealed the deal. While Muller’s film costs slightly more per roll than competitor’s film, the secret to beating the favored unit cost was simple; Muller proposed a long-term “partnership” and provided consistent and clear results.
“Muller’s film did cost slightly more per roll than competitive film,” says the client. “In addition to cost, the process to switch vendors and train staff can be cumbersome for some DCs. It took some convincing to get all our DCs on board and Muller had to prove itself to get the business and keep it for this long.”
Each of the many distribution centers is responsible for distributing roughly thousands of pallet loads per day – nearly quadruple the loads of stacked groceries are en-route daily throughout the regions served. Each road, driver and weather pattern is different which can gravely affect the condition loads are received in. There is nothing worse for the store or the distributor than opening the back of the semi-trailer only to find product toppled or damaged in transit. At that point, the entire supply chain effort is lost, not to mention countless dollars.
Common practice to prevent damaged goods is to contain loads using stretch film. Whether by hand or machine, stretch wrapping pallet loads has been extremely effective for reducing product damage during transport. Nevertheless, the challenge has become to secure loads in ways that optimizes the entire supply chain operation. The grocery distributer understood this challenge and looked for ways to do just that. “Stretch film is often perceived as a basic consumable and judged solely on price per roll,” says the client. “We knew better and challenged our vendors to show us the true value and total cost of ownership.”
So what was the secret to beating out the favored unit cost? Muller proposed a long-term “partnership” and provided consistent and clear results.
Setting a Standard
The first step to achieving greater total cost of ownership was understanding all the costs involved. For stretch wrapping processes, that means film consumption, labor and product integrity. For example, most companies use excessive film revolutions to ensure a secure load. This results in added waste and money lost. To ensure optimal film use, Muller created a Standard Operating Procedure (SOP) that ensures the distributor maintains the lowest cost per load while maximizing the films effectiveness.
Before the SOP could be created and prove useful, Muller analyzed the distributor’s loads to ensure optimal results. Having already worked with hundreds of DCs to provide proven solutions, Muller could quickly identify and propose the right films for the job. This knowledge not only comes decades of experience but also from the fact Muller is among the small few companies in the world to have a full package testing lab. As part of the Signode Industrial Group (SIG), Muller frequently solves customer load containment challenges in the SIG Application Development and Research Laboratory (commonly referred to as the “SIG Packaging Lab”). The state-of-the-art laboratory is equipped with ISTA certified simulation equipment designed to reproduce the forces that products experience in transit. Though the distributor did not need full lab testing, knowing it was a possibility now or in the future was a clear differentiator of Muller.
The distributor’s loads were manually tested with various film types, wrap patterns and other variables until an optimal result was achieved. For the distributor, it also meant taking into account operations on dry docks, coolers and freezers. In addition, Muller film consultants assessed the distributor’s needs, and benchmarked them against other key grocery players. In fact, a 70g film was proposed as it had already been proven over the years in the first distribution center that the distributor and Muller partnered with one another. More specifically, Muller’s GaleWrap Oriented Hand Film and Cast Machine Film were selected. Both films offer superior quality and excellent cling properties regardless of climate or transportation method. For the common B and C type loads at the distributors, a 2-1-2 wrap pattern was identified. This meant employees could reinforce just the top and bottom film layers as the rest was safely secured by the inherent holding force and contraction available in the Oriented Hand Film.
“Muller offers a quality product, we realized that right away. But more importantly, Muller provides superior service and backs up all its recommendations with real, quantifiable data. It takes the guessing game out of procurement,” says the client. “At the end of the day, determining optimal film product and application was key to our long-term savings and efficiencies.”
Going the Extra Mile(s)
The distributor had data. They had answers. They had an SOP. But now the company had to implement it. Muller representatives supported the distributor with on-site, round the clock service and support for the first week of initial delivery of film to each location. Muller met with the warehouse teams and provided in-service training on the film. This service not only ensures employees know how to properly wrap the loads, but also helps them understand the difference between Muller Oriented Film and conventional film. The partnership agreement with the distributor and Muller also ensures routine visits from Muller experts to any of the distributor’s DCs and requests for visits are completed in a timely fashion.
While hand film was resolved, the distributor also uses stretch wrapping equipment to apply film. For this step, Muller performs complimentary machine audits during routine site visits. As the only manufacturer of both leading film and equipment, Muller is uniquely positioned to identify and resolve any performance issues- regardless of the fact most the equipment at the distributor is not manufactured by Muller.
“Most of the DC’s could not believe Muller reps were actually onsite for every first delivery and how well the training was received by the staff,” says the client. “We were also impressed by the fact that Muller is more interested in our bottom line than whether the machine they audit is their own.”
To ensure the distributors saw Muller as a true partner and not just a vendor, the company set out to make contact as easy as possible. For one, Muller is a manufacturer not a distributor, which means the company had direct access to Muller at all times. In addition, the distributor has a single point of contact within Muller for all locations. This further ensures seamless ordering and delivery.
“How my product is received is just as important as the process it takes to get it there,” says the client. “Muller understands that and the result is that we are better able to better serve our customers, ensure a consistent and secure pallet delivery while simultaneously saving money and reducing waste along the way. It’s really been a fantastic experience and a true partnership from start to finish.”