LEVERAGING SUPPLY CHAIN DATA PACKAGING IMPROVEMENTS FOR CLUB CEREAL. Chris Dumont. General Mills

Transcription

1 LEVERAGING SUPPLY CHAIN DATA FOR CLUB CEREAL PACKAGING IMPROVEMENTS Chris Dumont General Mills

2 Leveraging Supply Chain Data for Club Cereal Packaging Improvements Chris Dumont Customer Packaging Manager April 7th, 2015

3 About Me U.W. Stout Packaging Engineering 15 Years of CPG Experience Customer Packaging Manager Role R&D Resource within Supply Chain Manage Packaging for the In Store Design Team Industry/Customer Packaging Initiatives Collaborate on Damage Reduction 3

4 Objectives Use Data to Drive Resolution Address Customer Complaints on New Package Structure Clear Up Internal Damage Perception Multiple Processes for Measuring Damage 4

5 Overview New Packaging Structure for Club Cereal Initial damage concerns from Customers Uncertainty around contributing factors Marketing Perception on Damage Confusion around how damage is measured Inconsistent Auditing Practices Competitive Landscape Customized Audit Process Leveraged data to make decisions Enable Apples to Apples Comparison 5

6 New Cereal Package Project Wejack 4+ Year Development Proprietary Densification Method for Cereal Numerous Benefits Cost Savings Material and Logistics Great Sustainability Story Pantry Friendly 6

7 Project Wejack Introduction Challenges High Capital Cost Existing Capabilities Structure Implementation Started with Club Products Introduced Bundling 70% of Cereal Volume across 3 Major Club Customers 3 Production Locations Lodi, CA Cedar Rapids, IA Covington, GA 7

8 Damage Complaints Increased Customer Concern ~40% of Rejected Damage at Peak All Club Customers Affected National, but skewed towards West Coast Long Term Marketing Perception 2008 Study on Twin Pack (Old Structure) Unknown Auditor and Process Damage percentage 3-4x higher than competition 8

9 Different Audit Processes Unknown History Other Inmar 12+ Year Partnership Only audited product visible to shopper Review all Products/Packaging Audit specific to Club and Cereal Only Consistent across all Customer/Channels Artificially high damage percentage Used as an input to ARP Vague Criteria/Subjective Review Five Point Damage Scale 9

10 Initial Study Primary Objectives Establish Damage Baseline on Wejack Sku s Understand Competition Compare Customer Performance East Coast Central U.S. West Coast Boston Chicago Portland Philadelphia Kansas City San Francisco Bay Area Charlotte Dallas Los Angeles 10

11 Products Wejack Sku s Twin Pack 11

12 How We Differ All Competitive Sku s are: Micro-Flute Cartons Two Bags in Carton Material Format General Mills Sku s Paperboard Cartons Most Sku s are in the Wejack Format Two Bundled Boxes 12

13 Five Point Damage Scale Acceptable Borderline Acceptable Rejectable/Unacceptable 13

14 Results Quick turnaround from initial request 60 Days Wejack Sku Damage 2x versus Twin Pack Sku s Wejack Sku s Twin Pack Sku s 2.64% 1.28% Much closer to competition than originally thought Still higher damage levels on average No significant difference between Costco and Sam s 14

15 Leveraging Data Data should be viewed as something tangible to validate instinct and can be used as the tipping point in decision making Material and Process Improvements were inevitable Funds were available from Business Team Strong need to maximize efficiency of spend Audit data confirmed where and emphasized why 15

16 Data Sources Customer Input Internal Reporting Inmar Studies 16

17 Items to Address Top to Bottom Compression (Horizontal Plane) Blossoming Pallets Corner Damage Shifting Individual Layers Entire Load on Pallet 17

18 Packaging Improvements Minimal Cost Easiest to Implement Applicable to All Products Thicker is Better Increase to 26pt on Carton Caliper Tie Sheet Basis Weight from 30# to 50# Customize where it makes sense Specific Tie Sheet Width for Sku s Tops Caps correctly sized for Sku s Added Corner Posts 18

19 Audit Phases Phase 1 Establish Baseline Performance Phase 2 Understand Packaging Material Changes Phase 3 Validate Manufacturing Changes 19

20 Phase II Study and Actions Repeat process 6 months later Across the board noticeable improvements Identified Highest Damage Levels Plant Location Customer Region Sku s Foresight to future changes needed in Manufacturing Continue to monitor tie sheet placement at all locations 20

21 Where to Go Next Western Region has Highest Damage Lucky Charms Highest Damage Sku Only produced at Lodi Only location to produce all sku s Lodi, CA 21

22 Manufacturing Improvements Pallet Inserter Minimize Touches Eliminate Clamping Stretchwrap Load to Pallet 22

23 Phase III Study Repeat process 12 months later 24% reduction in Lucky Charms damage Overall damage was slightly up over Phase II True for: Competition Non-Lodi Sku s Both Club Customers Higher Levels (4-5) Other plant locations considered for pallet inserters 23

24 Current State Projects Catalyst and Century No News is Good News Customer noise has settled Internal data reflects improvement Heightened sense of awareness at Plants and D.C. s Continue to monitor damage levels 24

25 Next Steps Explore Phase IV Study Identify ideal frequency Explore additional parameters and variables Manage as priority amidst current GMI Environment New Business Teams Changing Supply Chain Network Consideration of Wejack Format for any New Products 25

26 Latest News Lodi Cereal Line to move to Albuquerque Plant Pallet Inserter Projects Officially Launched Cedar Rapids Covington 26

27 Summary Data is an excellent supplement Lever in decision making Validates or negates assumptions Quantifies the degree of an issue Tailor your audit processes to your needs Remain objective to enable fair comparison Information at the appropriate level of detail Leverage both new and existing resources 27

28 Questions?

29 Chris Dumont

30 Click the survey button found on the session page.

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