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SCALA CASE STUDY

UK Logistics ITT Management

Ambient Grocery Supplier

Background & Brief

The client, part of a global food business is a UK supplier of ambient food products to the UK Grocery trade. With two UK factories, the client had outsourced logistics in a shared user arrangement. The client had been experiencing ongoing service issues and felt that its 3rd party logistics provider was significantly “behind the game” in its capability and service offering. As a result the client wanted to undertake a full ITT process for its UK Primary Transport, Warehousing & Distribution activity. SCALA’s role brief was to manage the full ITT process from selection of tendering companies, creation of the ITT to final selection of supplier and creation of a Heads of Terms agreement.

Project Approach

  • The project was managed with full liaison and involvement of the client’s key stakeholders with a clear and strong project plan and review points
  • Stage one represented an initial wide approach to 12 potential suppliers in order to understand the market place and to gain insights and innovation
  • Stage two focussed on three final proposals which included site visits, a series of meetings to fully understand the proposal and capabilities and follow through with supplier provided references
  • Recommendations included fully costed comparisons against current cost base and competitor bids as well as service and capability evaluation
  • Final negotiations were undertaken on a joint basis with the client

    • Benefits & Results

  • The process identified that the client was gaining significant cost advantage vs the market place and despite a loss of volume a new agreement was achieved with a less than inflationary increase
  • More importantly a series of operational capability improvements were agreed significantly improving the suppliers service offering to the client
  • Equally importantly a new relationship was established moving from the previous adversarial relationship to one of CI & shared benefits

    • Final Outcome

    A new contract was agreed providing the client with continued competitive cost advantage, whilst moving to an improved service environment and a new positive CI based relationship
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