SCALA CASE STUDY
Transport Operations and Strategy Review
Global Equipment Pooling Business
Background & Brief
The client, a world leading Equipment Pooling Business, engaged SCALA initially to carry out a review of its Transport operations within its UK and Ireland Supply Chain. The client had seen rapidly rising transport costs due to changes of traffic flows within its own supply chain combined with significant changes within the UK transport sector as a result of driver shortage and other inflationary cost pressures. The client’s transport operating model was based on a number of regional haulier partners supplemented by an increasing use of spot hire hauliers. SCALA were then engaged to undertake a strategic review of the client’s transport operations and strategy in order to ensure the client is best placed to address short and long-term service and cost challenges.
Benefits & Results
Working closely with the client SCALA produced a list of short-term recommendations to reduce use of spot hire haulage and increase transport availability for the key Q4 period. This was achieved through increasing rates tactically with key suppliers linked with acceptance of increased volumes thereby reducing use of spot haulage. SCALA also identified areas of focus for the client to address which were perceived by transport providers as barriers of working with the client. SCALA also identified an activity requiring focus which would significantly reduce the volume of loads being spot hired. The key immediate results were that the client achieved Q4 activity with enhanced customer service and Transport gross and unit costs improved by 10%, projected to deliver a £6m annual benefit.
SCALA have been re-engaged by the client to further develop Transport strategy but also take a broader view of the client’s Supply Chain network and structure. The review includes developments in cross functional KPIs and creation of balance scorecard, a review of processes and systems and a review of service centre structures and processes.