Packaging management costs in the supply chain
Iwona Nowakowska
Maciej Kubiak
Supply Chain Director
Country General Manager
About 呕ywiec Zdr贸j S.A. (Danone Waters)
Danone Group Employment - approx. 570 employees
呕ywiec Zdr贸j S.A. is a leader in the sector of bottled water in Poland
Other 43,6%
Polskie Zdroje 8,5% Coca Cola 5,8%
Nestle Waters 9,7%
32,4%
Source: Nielsen, Total Poland+Petrol Stations, 2011, value shares
CHEP is a global leader in pallet pooling services
Bydgoszcz Gądki
Warsaw Kampinos Radom
11 mln
4,500
600
Pallets Issued
Delivery Points
Customers
Świętochłowice
CHEP Service Centres CHEP Office
7 new countries were added to CHEP business in 2011
History of collaboration CHEP - 呕ywiec Zdr贸j S.A.
2010 2009 2008
End of analysing Value Chain
Begin of Value Chain Analysis
2007 Begin of negotiation regarding pallet management
Begin of cooperation (800x600)
2012 Begin of cooperation (1200x800)
Pallet Management at Żywiec Zdrój S.A. Requirements for pallet entry to producer’s factory
Volume
•
Beverage production requires high demand for pallets
•
Seasonality in sales causes fluctuation of pallet demand during the year
•
Production cycle requires just-in-time pallet supply
•
Limited space for pallets storage
•
The use of pallets on automated production lines requires high-quality carriers
Seasonality
Production
Quality
Pallet Management at Żywiec Zdrój S.A. Requirements for pallet entry to retailer’s location •
Pallet acceptance by customers
•
Shortening time of delivery
•
Decrease in responsibility for pallet management by Żywiec Zdrój and cooperating companies (e.g. Transporters, 3PLs)
•
Improvement in business relations with customers and other business partners
Acceptance
Time
Responsibility
Relation
Management of EUR pallets Cost generation at 呕ywiec Zdr贸j S.A.
Pallet Supplier
Distribution Centre Pallet purchese
Pallet Recycling
Pallet Administration
Pallet Acceptance
Pallet losses
Wholesalers
Retailers Increase in pallet balances
Repairs Return transport
Transport
Pallet management cost identification Value Chain Analysis Analysis of the Value Chain allows to estimate the cost of pallet management in the company
Supply Chain Analysis
SWOT Analysis
Cost Analysis
Analysis of the current pallet management system
Presentation of strengths and weaknesses of the current system
Presentation of current and estimated cost of pallet management
Pallet management cost identification Value Chain Analysis Do we have full knowledge about the number of pallets in the system?
How much does the pallet exchange cost?
Is the number of pallets shipped equal to the number of pallets received?
What factors influence the cost of pallet management?
Where are the biggest pallet losses?
Are we sustainable in pallet management?
What factors influence the cost of pallet management?
Transport
Variable pallet price
Pallet losses
Increase in transport costs
Unstable fuel prices
Increase in turnover /Sales
Responsibilities concerning sustainability
Cooperation with CHEP allowed 呕ywiec Zdr贸j S.A. to improve its supply chain ...
Security of supply
Consistent quality
Minimised administration
Safety in manufacturing
Safety in warehouse
Reduced cost
Distribution Centre
Acceptance (lack of complaints)
Faster deliveriy
Retailers
Wholesalers
Limited responsibility
No appointment for collection
Improvement of relations with customers and carriers
Transport Efficiencies
...and to bring transparency concerning the costs of pallet management
Pallets and the Environment
PEFC and FSC CHEP has the PEFC and FSC certificate, which gives Żywiec Zdrój S.A. guarantee, that the use of wood for the production of pallets generates from a legal source
5 700 trees... are saved within 10 years by Żywiec Zdrój S.A. using CHEP pallets
5 tons of CO2... are saved within 10 years by Żywiec Zdrój S.A using CHEP pallets
Żywiec Zdrój S.A. Social Responsibility in the context of Environmental Protection
Climate footprint reduction (reducing CO2 emissions)
Tree Planting and Education Revitalization of green areas, support the liquidation of illegal waste dumps Organization or Co-organization of educational workshops and ecological happenings, such as „Waste collection", "Eco Rally"
Iwona Nowakowska
Maciej Kubiak
Supply Chain Director
Country General Manager