The Challenge
Shipping perishable foods is a delicate business. Temperature-sensitivity, short shelf-life and seasonal unpredictability all contribute to capacity and pricing volatility in the produce supply chain. For produce shippers, it is imperative that products arrive to the end consumer undamaged and in a timely manner. The reality, however, is that long wait times and rejections are common.
Many produce carriers say that the problem stems from inaccurate projections on the grower side. In hopes of maximizing their sales, produce sellers tend to oversell their commodities. Pickup appointments are scheduled based on these projections and, if the growers cannot provide product on time and in full, the trucks are loaded anywhere from several hours to several days late (if at all). The unfortunate repercussions from there are potential missed delivery appointments, rejected product, and, worst of all, claims.
For our customer, long wait times at their facilities were a big challenge. Many of their locations were dealing with a staggering 3-day wait time for carriers to be loaded. In addition to that, our customer faced a large number of rejections at the receiver due to product quality. This resulted in huge losses as they had to resell the product to other receivers for a fraction of the initial cost
Partner Profile:
A produce marketing company based in Los Angeles, California providing a variety of fresh products to stores across the U.S.
Project Snapshot:
As their Managed Transportation Partner, Capstone worked with a produce shipper to reduce wait times and manage rejections at the receiver. The reduction in wait times and rejections resulted in better relationships between carrier, shipper, and receiver.
Before Partnering with Capstone
of total costs were rejections
of rejections led to an extra two days on the truck
of all rejection were brought back to the shipper
added costs due to rejections
When shipping produce freight, carriers are generally looking for: commodities that yield low claims, consistent volume, quick turn time, and a generous accessorial schedule. In the case of our customer, their carriers continually lost revenue because the accessorial policy did not properly recompense wait times and rejections. As a result, our customer could not build strong relationships with their carriers and many were no longer interested in their freight.
The Solution
Capstone is a produce shipping expert, and as our customer’s Managed Transportation Partner, we were able to take a consultative approach to their issues. After an in-depth analysis of their supply chain, we implemented a number of changes and initiatives that helped our customer become a Shipper of Choice.
- Implemented a dedicated Resolutions Manager to handle all inbound rejections. This created a central point of contact for all carriers with issues relating to inbound rejections. The Resolutions Manager was responsible for communicating with drivers, providing customer service and giving disposition. This increased transparency and improved communication, which ultimately enhanced the drivers’ experience.
- Created internal “Rejection Key Performance Indicators.” These standardized metrics kept us accountable and helped reduce the time from notification of rejection to disposition, while minimizing the number of extra days on the truck and the overall added miles. It also provided us with metrics that we could implement across our customer’s carrier network and actionable data to leverage with their buyers to improve acceptance rates, reduce rejections, and increase sales.
- Solidified “Plan B” delivery locations for highest rejection points. We tapped our nationwide network of warehouses to create “Plan B” locations (within 50 miles of the original delivery location) before the season started to ensure the backup plans run smoothly. We also worked with our customer to create dedicated rejection receiving plans with each of the “Plan B” locations so they are prepared. That way, if a trailer is rejected, our drivers can deliver to the “Plan B” locations instead of waiting for hours for further instruction.
- Implemented an appointment & prioritization system at the shipper. Before partnering with Capstone, our customer utilized a First Come First Served method with no structure around load prioritization. There was also a lack of cross-departmental communication which caused breakdowns throughout their supply chain.After implementing the appointment & prioritization systems, we saw an improvement in facility congestion, a reduction in staging and loading times, and a reduction in accessorial charges.
- Established an accessorial policy that would compensate drivers for delays. This helped our customer become a shipper of choice and retain valuable, reliable carriers in their network.
The Results
After implementing Capstone’s recommendations and services, our customer reduced wait times in the next season from 3 days to a maximum of 1 day. This improvement helped make them a more attractive partner for their carrier network. It has also motivated them to onboard more new customers; they know they can trust Capstone to handle their freight, so they feel comfortable taking on more business. Read about more improvements in the boxed section below:
After Partnering with Capstone
In addition reducing wait times by 2 full days, Capstone enabled our partner to see real, measurable improvements.
Reduction in claims ratio
Increase in recurring carriers
Reduction in number of rejections brought back to shipper
Saved by decrease in rejections at shipper
THE BENEFIT OF HAVING BROKERS IN YOUR NETWORK
Produce shipping can be a challenge. To ensure that you are maintaining low wait times and managing rejections properly, you need a carrier partner who has proven experience.
Advantages Include:
- Agility when dealing with last-minute changes
- Regional or niche areas of focus
- A consultative approach to your supply chain
Unrivaled Transportation and Brokerage
It starts with a commitment to you. Show us your freight management problems, and we’ll show you tangible solutions.
