Over, Short and Damaged Data to Manage Unsaleables

Understanding a structured Over, Short & Damaged (OS&D) program can drive value though process

controls and data analysis. Learn how Heinz is using data to make changes within their supply chain to be

more efficient in the future.

Heinz MUDA Reduction Road Map

• Unsaleables management 2004

– Reclaim

– Swell Allowances

– Markdown Program

– Liquidation

• Added internal waste streams in 2007

– Disposals, Raw Material and Finished Goods

– Warehouse Damage and Cycle Count Adjustments

• Final piece of puzzle: OS&D program 2009

– Delivery exceptions

– Customer convenience returns

3rd Party Selection Criteria

• Industry ranking

• OS&D experience

• Carrier network range

• Infrastructure, systems and processes

• Value

• Professionalism and Credibility

• Internal efficiencies

• Adaptability

C.H. Robinson Overview

• More than 36,000 active customers

• Over 9.2 Million shipments handled annually

• More than 1 million shipments annually in the Food & Beverage Industry

• Grocery Manufacturer Member

• Executive member of key Food & Beverage associations/organizations

– Produce Marketing Association - Center for Produce Safety

– Food Marketers (FMI) - Produce for Better Health

– Food Shipper Association - United Fresh

– Sustainable Food Lab

Solution Heinz was Seeking

Event Coordination

• Immediate and consistent control of order exceptions

• Synchronized communication to all pertinent parties

• Visibility to all exceptions and resulting disposition

• Single chain of control for food products

Measurement & Improvement

• Metrics for logistic related delivery exceptions

• Reduced cycle return times

• Gathering and reporting program compliance

• Assistance in gaining measurable order fill rates

Road Map

• Development and optimization of practical disposition rules

and thresholds based on item value

• Centralized communication platform established

• Return processes to deliver lowest cost scenario and cycle

time goals

• External education of carriers

• Internal education of Heinz Customer Service, Customer

Accounting, and Supply Chain teams

• Baseline reporting suite developed

• Continuous review of data to drive efficiency at both DC and

customer facilities.

OS&D Best Practices

• Consistent processes

• Reduction in transportation accessorial charges

• Immediate visibility to OS&D events

• Centralized web interface

• OS&D trend reporting drives:

– Distribution center accuracy

– SKU/packaging awareness

– Carrier compliance

– Consistent delivery exception execution

How Heinz Obtains Data

• On-going exchange of item information

• Detailed tickets are input by CHR Customer Service

• OS&D events are communicated via email

• Ad-Hoc and Automated reports sent on regular schedule

• Perpetual data availability

• Systems compatibility

How Heinz Utilizes the Data

• Benchmark OS&D occurrence rates by location

• Returns by event type

• Return transportation expense tracking

• Foodservice channel

• Low reclaim items

• Determining customer behavior

• Evaluating packaging and/or product alternatives

• Common denominators

Questions