Bacardi's marketing slogan to its customers is "party all night." For its own logistics team, the new message is "third-party all the time." Within the last year, Bacardi U.S.A. has outsourced an increasing amount of its transportation management to Ryder Systems' Supply Chain and Transportation Management Solutions division. Ryder now handles all outbound transportation management from Bacardi's Florida distribution center to distributors and other intermediaries around the country.
According to Robert E. Damon, logistics manager for Bacardi U.S.A., the outsourcing deal has already made tremendous improvements in its service levels and in its shipping productivity. Before bringing in Ryder, Bacardi controlled only a small portion of its outbound traffic. Consignees controlled the vast majority of the outbound traffic. Product was sold FOB at the Jacksonville DC, and Bacardi was at the mercy of customers to arrange for carrier pickups. Unfortunately, pickup appointments frequently were missed. Loadings were delayed. Trucks constantly clogged the loading areas. Drivers wasted many hours waiting to be loaded.
"Our first priority has been to regain control and efficiency of our outbound movements," says Damon, who adds that this goal has just about been achieved. "Our next goal is to focus on cost savings."
The first step Bacardi took was to change sales terms to CPT [carriage paid to] customer's location, so customers took title at the DC, but Bacardi paid and controlled the transportation. The next step was to bring in Ryder Systems to manage the entire outbound transportation process.
Ryder selected carriers that offered the best service and rates to customer delivery points around the country. Where consignees had deep relationships with carriers, Damon says that Ryder tried to use truckers or intermodal marketing companies that the consignee had previously used, but the focus was clearly on dramatically improving outbound performance. Ryder substantially reduced the number of carriers, negotiated rates and set up dispatching procedures. It also has set up a trailer pool at the Bacardi DC, so orders can be preloaded and ready for truck tractors according to tightly scheduled appointments.
"Carriers have told us that this system is very beneficial to them because no driver time is lost at the loading dock," says Damon.
As part of the transportation management operation for Bacardi, Ryder uses RyderTrac, a web-based solution that is available via a portal to Bacardi personnel, its carriers and its customers. The portal allows all authorized parties to view or manage status updates for all loads and shipments down to the smallest details. Carriers can view information on their loads en route, as well as information on their entire day's loads plan and future loads already tendered. Bacardi customer service reps and customers can track individual orders and monitor estimated delivery times that are constantly updated in real-time.
While Bacardi U.S.A. is just getting started with Ryder, Damon says that he is already impressed by their comprehensive and collaborative team approach to integrating supply-chain processes and requirements.
"Their ability to make mid-course corrections for our shipments ensures our brands are delivered within the expectations of Bacardi and our distributors," he says.
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