Produce Platform Standardization Drives Cost-Savings
In 1949, the average grocery store carried less than 4,000 products. Today, an average grocery store carries nearly 40,000 products and consumers benefit from year-round access to fresh produce thanks to the wonder that is the modern, truly global food supply. In fact, nearly 20% of all food consumed in North America is imported, including 35% of all produce.
Metro, Inc. is the third largest retailer in Canada, with annual sales of $11 billion and nearly 600 store locations in Quebec and Ontario. The company is a leading purveyor and importer of fresh produce. Metro was experiencing delays, inefficiency and higher costs for fresh produce it sourced from American, Mexican and South American growers because the growers utilized a type and size of pallet to move their goods that was not completely compatible with the company’s supply chain operation. So, the produce had to be transferred from the originating platform to another pallet at the retailer’s distribution centers, leading to longer shipping timelines and higher labor costs.
"Standardization for our fresh produce is key to our supply chain. CHEP was able to work with us to identify a solution that saved time and money. It was a perfect solution and is a perfect partnership"
Director, Quality Assurance, Produce
CHEP moves goods in countries with 90% of the world’s GDP and 70% of its population and knows how to navigate a smoother passage through the global supply chain – from farm to retail. CHEP’s local experts worked with Metro’s Retailer Quality Assurance team to evaluate Metro’s fresh food supply chain with the goal of developing a standardized approach for getting fresh produce to market. CHEP analyzed each step of Metro’s fresh food supply chain to determine a new approach that would streamline the company’s fresh food operation.
CHEP worked with Metro and its grower suppliers to find a single platform solution that could be used effectively from fields in the U.S., Mexico and South America, all the way to the store level, eliminating the inefficiencies caused by a multiple platform solution.
The single platform solution developed by CHEP and Metro resulted in both greater efficiency and cost savings. A sharp increase in the percentage of standard North American pallets arriving at Metro distribution centers minimized handling and operational costs because significantly more product arriving from American, South American and Mexican growers did not have to be transferred from the platform utilized at the farm to one compatible with Metro’s distribution centers and retail locations. In fact, the standard North American platform solution resulted in a reduction in Metro’s labor costs because it requires less handling time per pallet.
For More Information:
Learn more about CHEP supply chain solutions, including:
+ Pooled Pallets - http://solutions.chep.com/platforms/pallets?pallets=pooled
+ International Pallets - http://solutions.chep.com/platforms/pallets?pallets=international
CHEP and Metro develop a single platform solution for use internationally resulting in greater efficiency and cost savings.