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    E-Commerce Division of Major Retailer Saves $2.7 Million with Relogistics Total Pallet Management

    See how we helped this retailer overcome challenges with accurate pallet sorting and repair, program training, sufficient laborers, and more. 

    Background

    • The Customer: One of the nation's largest retailers with over 25 dedicated e-commerce fulfillment centers across the country, generating over $45 billion in revenue. 
    • The Problem: Operational challenges while self-performing pallet management.
    • Our Findings: The retailer was experiencing setbacks in sufficient laborers, management oversight, repairing onsite pallets program training, accurate pallet sorting, and data and reporting. 
    • Our Solutions: Our team of onsite program experts worked with the customer's leadership team to develop total pallet management programs including pallet sorting, removal, and onsite repair. 
    • The Results: By implementing our onsite pallet management program, this retailer was able to save $2.7 million and focus more on their core business.

    In 2013, one of the nation's largest retailers recognized that the e-commerce market was expanding and that consumer trends were shifting from the traditional retail store model. Their plan to introduce their e-commerce division was implemented in 2016 and has expanded to over 25 dedicated e-commerce fulfillment centers across the country, generating over $45 billion in revenue with continued growth plans.

    Relogistics, a 48forty Solutions company, has been partnering with this retailer for almost 20 years, handling their pallet and asset management needs and helping them to achieve their growth goals.

    Problem

    During the initial phase of the e-commerce fulfillment rollout in 2016, they approached our supply chain team with operational concerns regarding their new divisions' pallet management program.

    Before partnering with Relogistics, the customer attempted to self-perform their pallet management program and processes.

    stacks of pallets in warehouse

    Companies may choose to self-perform their pallet and asset management to reduce costs. When deciding to self-perform, it is essential to keep in mind the following associated costs and responsibilities:

    • Labor
    • Quality Control
    • Reporting
    • Insurance
    • Equipment
    • Transportation
    • Training
    • Compliance
    • Documentation
    • Human Resources

    Findings

    Merchandise arrives from suppliers on wooden pallets of various sizes, which are stored at the distribution center until an online order is placed. When the product is purchased, these items are removed from the pallet and sent out for delivery to the consumer. In addition, items arrive floor stacked and must be palletized for transport. 

    While trying to self-perform all aspects of their pallet management program, the customer was experiencing setbacks in the following areas:

    1. Sufficient Laborers

    2. Management Oversight
    3. Repairing Onsite Pallets
    4. Program Training
    5. Accurate Pallet Sorting
    6. Data and Reporting
    forklift operator moving stack of pallets

    Solutions

    This retailer recognized that attempting to manage their pallet program was hindering their goal of achieving the maximum operational efficiency required to be a leader in the e-commerce space.

    Our team of onsite program experts worked hand-in-hand with the customer's leadership team to do what we do best - develop total pallet management programs that include pallet sorting, removal, and onsite pallet repair.

    By implementing our onsite pallet management program this retailer was able to save $2.7 million and focus more on their core business. 

     

    Their Customized Program

    • Six Sigma Process Reviews
    • Space Utilization & Equipment
    • Onsite Pallet Sorting & Repair
    • Detailed & Accurate Reporting
    • Labor Optimization
    • Program Management
    • Efficient Pallet Removal

    Results

    3.4 million pallets sorted
    181,000 pallets repaired onsite
    128,000 Hours saved
    $4.2 Million pallet purchase savings
    $2.7 Million Net Cost Savings

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