When Woolworths Limited and CHEP Australia partnered on an initiative to identify equipment control process improvements, the outcomes stretched beyond the walls of any one store. Improvement opportunities spanned across the retailer, trading partners and could potentially benefit the wider FMCG sector.
Quite simply, Woolworths realised the key to more effective equipment control lay in identifying gaps in procedures and implementing best practice.
Given the magnitude of Woolworths’ operations, CHEP Australia process improvement specialist, Lesley Oppy, was invited to work with Woolworths’ national unit load device (ULD) manager Belinda Field to come up with a national solution. Lesley led the project, first conducting an audit of equipment control processes at 13 Woolworths grocery warehouse distribution centres nationally.
The project aimed to embed best practice for the management of hire equipment, delivering loss mitigation initiatives and develop reports to assist with the ongoing monitoring of equipment control. The project focused on seven key areas: receiving, dispatch, salvage, transport, security, stores and the account reconciliation process.
Belinda Field said, “The project provided us with greater visibility over what we were doing in the ULD space throughout our network. The process review gave us the opportunity to see the best practice areas and where the opportunities for improvement were. From this we were able to make recommendations for both operational and business divisions to achieve effective equipment control.”
The recommendations included the removal of hard copy Pallet Transfer Authorities (PTAs) which has been universally well-received. Removing PTAs means that Woolworths trading partners now have greater control and visibility of their pallet flows. The sender can now raise a transfer docket to accompany a load, it is checked on receipt of the goods and given back to the driver. Senders no longer wait for a docket to be sent back to them before reconciling accounts. The process also saves costs by eliminating docket books.
The removal of PTAs was a big step forward in pallet administration. It has been well received by our trading partners. It’s a simpler process and our trading partners have more control. They are now able to raise the documentation and have it readily available for drivers," Field said.
“Woolworths has streamlined the process of delivering into distribution centres adopting one procedure for all sites. It means there’s only one rule and it’s beneficial for the sender. The third party logistics partners and transporters have said they’d like to see it adopted across the entire retail sector.”
Standardisation is a hallmark of this initiative. Oppy documented and analysed the process at several grocery warehouse distribution centres and made recommendations that would see standardised best practice implemented. The distribution centres were reviewed individually to ensure that the recommendations were specific and relevant, resulting in across the board best practice equipment control being implemented.
The initiative identified many examples of control excellence throughout Woolworths sites. The challenge was to embed these processes across all the distribution centres to make sure all sites were operating consistently to best practice.
Key to the recommendations was an increase in training, to help change perceptions of the process.
“Perception is the biggest hurdle in getting businesses to take pallet control seriously as a cost line. Pallets are not just a piece of wood, they are necessary to move product efficiently throughout our network,” Field said.
“Once people begin to understand the need for equipment and its associated cost, you tend to get more clarity and traction.
“There is now better clarity across the business regarding what ULD is – [hired equipment] this is part of our inventory and needs to be managed. It’s now a focal point; it’s being spoken about instead of not noticed.”
At the conclusion of the initiative each site received individual reports and recommendations as well as an overall final report to assist with embedding the changes.
“The process has provided good insight and learnings for all of us regarding the requirements for optimal equipment control and will be of substantial benefit assisting with identifying process gaps across all retail distribution centres,” Oppy said.