Page 33 - Case Study Annual 2015

LAA 2015 Gold

Imperial Cold Logistics /
Resolve Solution Partners

Enabling successful cold logistics

Due to a combination of macro- and micro-economic factors, the South African

retail and FMCG markets have been under significant financial pressure for a

number of years. Imperial Cold Logistics (ICL) was no different, having to deal very

quickly with a number of challenges.
Imperial Cold Logistics (ICL) is a specialised logistics
and supply chain service provider for frozen and The supply chain assessment showed there was
chilled products in the FMCG sector. Previously significant value to be realised, both in efficiency
known as The Cold Chain, ICL has been part of the and in customer service. A number of initiatives and
improvement projects were mapped out with a detailed

Imperial Logistics’ group of companies since 2000. operations implementation calendar and project plan.

ICL’s core services include warehousing, inventory The improvement initiatives were grouped,

management and distribution solutions for a unique prioritised, sequenced and planned into projects.

product category with very stringent logistics

requirements. To create the most cost-effective offering

for the market, the business model offers a shared

infrastructure solution, whereby an optimised and

practical service can be offered to manufacturers of

these products and their distribution into the retail

footprint.

The business problem The implementation

ICL was faced with a number of serious challenges: The recommendations were implemented by:
margins were under strain; network and facility costs • Reducing the ‘customer tail’. ICL previously had
were debilitating; charge methodology didn’t encourage
correct behaviour; and many more. Central to ICL’s delivered to a customer universe of around 6 500
concerns was the extensive supply chain network, customers per week. This was reduced by closing
operating through 11 facilities nationally, utilising a the accounts of the 1 300 smallest customers in the
large fleet of trucks. delivery universe. A reduction of nearly 20% in the
delivery fleet was achieved with a loss of only 1% of
ICL contracted its peer company, Resolve Solution distribution volumes.
Partners, to assist in re-defining an operating model that • Implementing a minimum order quantity of R6 000
would improve the business’s financial situation and per delivery per customer for a period of 2-3 months
improve its service offering to customers. Resolve, also after the initial review of the ‘tail’.
an Imperial Logistics company, is a professional services • C losing remote distribution centres such as Klerksdorp,
company, focusing on advisory and outsourced services Dundee, East London and George with customers
in the supply chain arena. being serviced from the adjacent distribution centres.
Far country delivery fees were recovered from
The analysis principals for deliveries in these closed regions.
• Implementation of a state-of-the-art Transportation
Resolve performed an overall supply chain assessment on Management System managed by Resolve whereby
the current ICL network and operations, identifying the
key drivers of performance and associated improvement
opportunities and the company’s challenges.

The analysis focused on structuring the most efficient
network; improving ICL’s ability to differentiate itself in
terms of customer service; and considering scenarios to
free up capacity in the network for a suitable principal.

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