Benchmarking Logistics Contract Commercials

Major Distributor in Drinks Industry

Background & Brief

The client, part of a major part of major drinks organisation distributed Wines and other Drinks from a base in South East England. The client was committed to a long term contract with a Logistics Services Provider but with an option for a Benchmarking comparison at it’s mid-point after five years. The client, with the agreement of the LSP, appointed SCALA as the “Trusted Neutral” to undertake that benchmarking.

Project Approach

The Benchmarking incorporated both Open Book and Closed Book activities including :
  • A central warehousing operation
  • Distribution across South east England on Dedicated Vehicles
  • A number of Outbases with Dedicated Vehicles
  • Trunking Operations
  • A “Shared User” service for a wide range of deliveries that could not be undertaken efficiently on dedicated vehicles and benefitted from combining with other clients
  • Benefits & Results

  • SCALA produced a range of quantified comparisons looking at external operational performance comparisons and known commercial comparisons for very similar businesses
  • These were presented to both companies who were given the opportunity to challenge, before a full comparison report was finalised
  • Final Outcome

    The project identified areas where operational improvements could be achieved and additional cost comparisons which indicated the potential for savings in excess of £1m per annum. The client is now in discussions with the LSP to examine how move forward.
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