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The P ooling

The P ooling. A tough equation to be solved. Reduce the Stock. Improve delivery reliability. Reduce carbon footprint. Increase service level. Keep Logistics costs under control. H istor y & Origins of Pooling Solution. Pooling Concept & Solutions presentation to customers.

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The P ooling

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  1. The Pooling

  2. A tough equation to be solved... Reduce the Stock Improve delivery reliability Reduce carbon footprint Increase service level Keep Logistics costs under control

  3. History & Origins of Pooling Solution Pooling Concept & Solutions presentation to customers July 2003 - Oct 2004 2005 SITL Conference Award for Innovation Pilote Implementation + VMI Dpt Creation + Set-up of Flows Coordination Tools + Multiple contacts with Retailers Creation of a Supply Chain Mgt Expertise >> Definition of high value services 2005 to date... June 2003 June 2002 Development of new pools & deployment of existing ones End of 2001 2014 Pooling Conception following requests from customers & prospects to massify their flows Pooling becomes real thanks to 2 pilote producers „Supply-Chain King” Award for SPHINX Pool Oct 2004 2001 Start-up of 1st VMI Pilote + Investment in more powerful tools

  4. Producer B Definition of Pooling in FM Logistic Consolidation of producers logistics flows in order to increase delivery frequency & dropsize towards retailers Distribution Centers Producer A 30 pallets 26 +7 pallets 14 pallets 1 delivery every 4 days 1 delivery every 5 days 1 delivery every 8 days Retailer Distibution Center

  5. Requirements for Pooling set-up : multi-producers platforms Multi-producers Strategy >>Pooling solution might be implemented only with common Inbound & Outbound points for producers. >>FM Logistic multi-producers platforms are essential assets and lever of performance for Pooling implementation, thanks to mutualisation & resources optimization under one single roof.

  6. Flows Piloting • From easiest… • Implementation of deliveries in combined loading in agreement with retailers • Agreement with each retailer on days & time of combined deliveries for all involved producers in the same vehicles • Possibility for some retailers to manage group of suppliers and optimize their Inbound Transport • …to most advanced solutions • Mutualized Vendor Managed Inventory Process • Mutualized VMI (FM Logistic) allowing a dynamic allocation of quantities proposed by producer, depending on real needs (no fixed lot size) • Each producer gets access to its data (confidentiality management in the tool), manages parametrization and remains responsible for orders proposal in regards to its own conditions with the retailers • VMI Tools used : OCS & EWR MP

  7. FM Logistic Role : Facilitator Retailers Producers

  8. Retailers Expectations : Answers from the Pooling • Flows massification is a collaborative approach between producers supported by retailers : • Improve the on-shelf availability • Improved reactivity thanks to increased frequency • Securing transport thanks to flows balancing and vehicles optimization • Piloting of the stock level by suppliers (VMI) • Improve the cashflow • Stock reduction due to increased frequency • Reduce Carbon Footprint • Through better vehicles optimization

  9. A win-Win Solution ENVIRONMENT Improvement of on-shelf availability Increase transportation reliability Decrease on stock level Contribution to reduction of CO2 emissions Global Supply Chain added-value creation

  10. The POOLING Feedback on the 5 existing Pools +0,2 à +1,5 points Service rate 15 to 30% Decrease depending on producers/retailers +5 to 10 points - 30 to 35 % CO2 emissions

  11. FM Logistic Pooling in France Grocery Home Care Since 2013 Personal Care Multipickprocess Since 2011 Cosmetics Since 2005 Grocery No VMI, multipick Pool

  12. ‘SPHINX’ : The partners Sara Lee Maison du Café Heinz Nutrimaine Kimberly Kellogg’s Intersnack SPHINX X K P H I N K S 1.500 SKU 1,4 billion € Sales 1 million pallets delivered / year

  13. Situation at project Start : Beginning of 2012 1 multi-pickPool Since 2009,North of Paris 1 Grocery Pool Since 2004,North of Paris (with FM Logistic) 1 „single” producer North of Paris (with FM Logistic) 1 Coffee Pool + Cadbury Since 2004 near Orleans 1 single producer Lyon area SPHINX

  14. Situation : End of 2012 Pool SPHINX with 7 producers from North of Paris (Longueil Sainte-Marie) : SPHINX

  15. Physical process Pooled orders Pooled orders Pooled orders Pool Pooled orders Entry Gate Pooled orders “Pooling” docks area Delivery Notes Pooled pallets Pool Control Tower SPHINX

  16. Organization • Mutualization of storage for the producers : • 7 producers under one single roof : 100 000 sqm warehouse dedicated to pooling • 1 million pallets flow per year • A migration plan from December 2011 to Mid September 2012 • Transport Control Tower : • Delegated to IPS • Process of mutualized Vendor Management Inventory : • Mutualized VMI (FM Logistic) allowing a dynamic allocation of quantities proposed by producer, depending on real needs (no fixed lot size) • Each producer gets access only to its own data (confidentiality management), manages parametrization and remains responsible for orders proposal in regards to its own conditions with the retailers • VMI Tool selected by the pool : OCS • Data confidentiality management • Groundfloor pallets algortyhm SPHINX

  17. Results in line with expectations one year after start-up SPHINX

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