Deliver and Return The so-called “logistics” of the supply chain, including coordinating orders and facilitating deliveries, as well as creating a process for receiving defective and/or excess products back from customers and supporting customers who have problems with delivered products.
Ideally, when a load goes out the gates, it gets delivered in full, on time, and to the right address. Ideally. “Distribution is the highest cost for a dealer after personnel,” says Kellick-Grubbs. “There’s a lot of stupid stuff we can correct to make it as efficient as possible.”
Among the low-hanging fruit is delivering to the wrong address. “If you’ve got a bad address, you’ve reduced your opportunity cost significantly,” she says. In addition to installing the practice of efficient (and, even better, automated) data transfer regarding orders and delivery addresses as a load makes its way from sales to the truck, Kellick-Grubbs advocates dealers use GPS tracking devices and mobile phones or two-way radios to ensure accurate deliveries.
At Raymond Building Supply, Babb entrusts his sales team to shepherd orders and confirm addresses. “Our goal is always to avoid two shipments for one product and to fill the order completely,” he says. In addition, the dealer stores 95 percent of its stock under cover, maintains a “first in/first out” policy regarding inventory, has installed spider lifts on its fleet to gently and more precisely deliver materials, and provides covers for on-site materials during inclement weather.
At Vassar Building Center, MacKay has struggled on occasion to maintain on-time and accurate deliveries to a mostly new sales territory within a two-hour driving radius of the dealer’s one location, but employs a policy that helps avoid delays and miscues. “The goal is to always start the day ahead of the game,” he says. “Tomorrow’s trucks are loaded today. That gives us at least a chance at providing the service we promise.”
To accurately measure logistics performance, says Kellick-Grubbs, dealers need to report and track whether loads are delivered on time and in full. “You have to measure those together to get the real story,” she says.
If a dealer does all that, as well as the other SCOR-model steps, the chances of materials returns are greatly reduced. Still, smart and strategic operators are prepared for those occasions. “If we get a call about a return, our policy is to pick it up within 48 hours and post it within 72 hours,” says Big C’s Wallace.
At Raymond, meanwhile, “Customers with returns go right to the top of the list,” says Babb. “And we pay attention to it so it doesn’t happen again,” such as circling back to the sales manager and/or associate, as well as the customer, to dissect the problem and its cause, from a rush job to an improper or careless drop to simply not having the right product in stock.
More About SCOR For more information about the SCOR-model for supply chain management, including in-depth matrixes and processes for applying the framework to your business, go online to www.supply-chain.org or call 202.962.0440.
