Turn Your Perishable LTL from “Necessary Evil” to “Supply Chain Enabler”.Transportfolio
Every day, we talk to shippers and retailers about shipping produce and other perishable commodities in LTL quantities. Frankly, most see these shipments as a painful, yet necessary, evil in selling their products, but they don’t have to be. I’ve found that customers who shift their perishable LTL thought process from transactional to planned discover eye-opening improvements throughout their supply chain. Here are a few examples of how the industry has and continues to evolve, and how companies found success when making this crucial shift in thinking and behavior.
Today’s supply chains are changing—they are becoming increasingly complex. There are many reasons behind this, but consumer buying influences and multi-channel sales seem to be driving more change than others. The Millennial generation’s buying behavior is highly based on brand, health, and convenience. We’re seeing healthier, more convenient products sold through new channels as a result, which is driving average order size down, frequency of delivery up, and, naturally, greater scrutiny on supply chains.
So what do these changes have to do with the perishable supply chain? Quite a bit, actually.
In yesterday’s supply chain, the average order size was larger and offered greater flexibility, from a delivery perspective. With that, traditional rolling consolidation methods proved to be a successful way to execute perishable LTL deliveries. A shipper could either self-consolidate across multiple orders to make the necessary deliveries, or hire a transportation provider to execute the deliveries, consolidating across multiple shippers. Through this method, perishable LTL transportation was typically viewed as an independent variable in the supply chain, primarily only enabling one component of the supply chain as you can see below.
Fast-forward to today. Traditional LTL transportation methods typically require additional delivery flexibility, but with smaller order sizes, this often results in erratic ordering behavior. Order quantities will vary a great deal from one order to the next and volume and frequency can be unpredictable, which can also have direct impact on freight spend. Shippers may have a difficult time forecasting how much product or inbound materials are needed, transportation providers lose the ability to consolidate with consistent volume, customers receive less consistency in service, and consumers don’t know why their favorite product isn’t on the shelf.
So how do you manage these issues to enable your supply chain?
- Analyze and leverage all of your LTL volumes, not just what is viewed as “painful.”
- Create a planned environment through forward distribution and traditional rolling consolidation where applicable—with aligned sailing schedules and capacity strategies.
- Aggregate volume from origin region(s) into destination regions.
- Utilize consolidation points for forward distribution, all on a regular cadence.
As you can see below, with the right model to support your perishable LTL orders, you can achieve greater efficiency across your entire supply chain. The net result is an enabled supply chain offering a way to manage freight spend, change, and risk, all while improving efficiency.
Ultimately, results can vary by situation. But I’ve seen many companies make a similar transformation, creating a more efficient supply chain, and allowing them to do what they do best—selling and marketing their great products.
To learn more about optimizing your perishable LTL supply chain, reach out to your transportation provider and explore your options. Also, discover six supply chain best practices for temperature sensitive freight in this whitepaper: Maintain the Cold Chain: Six Supply Chain Best Practices for Temperature Sensitive Freight.