When a large, national bakery and snack food manufacturer turned to Penske Logistics to optimize their middle mile logistics across a sprawling network, we delivered.

The Challenge

The middle mile can be complex. Products move from manufacturing facilities to distribution centers and cross-docks, then flow through depots to fulfill orders with precise timing.

The stakes were high: late deliveries disrupted operations, poor visibility left customers in the dark and order inaccuracies – overages, shortages and damages (OS&D) – frustrated independent delivery providers (IDPs), who handle the final mile to retailers and grocers.

The Solution

Penske launched an integrated approach combining dedicated transportation, managed transportation services and technology that results in thousands of weekly deliveries flowing smoothly from manufacturing plants and warehouses to pick up depots, all with the visibility, accuracy and reliability the manufacturer needs. Here’s how we did it.

Designing a Smarter Middle Mile

Network design and planning are fundamental to middle mile efficiency and cost control. Penske’s engineering team and operational experts analyzed the manufacturer’s data, collaborated to identify pain points and implemented technology to build a more responsive, efficient and resilient supply chain.

Value Stream Mapping

The first step in design and planning is Value Stream Mapping (VSM), a comprehensive visualization of product and information flows to uncover inefficiencies. Through detailed process audits across each location and service area, the team evaluated end-to-end operations and discovered opportunities to streamline processes and improve productivity.

The team conducted audits and evaluated each of their location service areas to find cost-saving opportunities in their operations. This exercise helped the team identify areas of improvement in the operation.

Route Planning and Resource Allocation

Managing routes across a multi-facility network requires a comprehensive, data-driven approach. Our engineers worked closely with the manufacturer’s operational team to optimize routes while balancing priorities, including preferred delivery schedules, production timelines and available resources.

The team developed customized strategies based on product types and mapping business rules for every delivery site. They factored in ready time for products, delivery windows, curfew limitations and expected dock times.

In addition, they analyzed traffic patterns, typical capacity, shipment forecasts, driver availability, toll costs and safety requirements. The result: improved routing efficiency, better equipment utilization and higher on-time delivery rates.

Delivery Tracking and Visibility

On-time delivery is the most critical middle mile metric. Delays at distribution centers ripple through the supply chain and has a profound impact: when outbound shipments miss delivery windows, products do not reach stores and revenue suffers.

Penske implemented an electronic proof-of-delivery solution that increased accountability and visibility. Drivers now photograph and count every load, uploading the information to a shared portal accessible to both the manufacturer and IDP. When issues arise, the manufacturer can immediately assess the situation and resolve problems faster.

For outbound operations, Penske empowered IDPs with SMS text alerts providing real-time updates on inbound delivery status. This visibility reduces depot wait times and improves coordination. Drivers know exactly when their loads will arrive, transforming uncertainty into predictability.

Distribution and Fulfillment

Distribution center productivity and order accuracy directly determine supply chain performance. Beyond meeting on-time, in-full delivery commitments, facilities must flex operations and staffing to meet production schedules and seasonal demand swings. Technology and automation are unlocking new levels of efficiency in both areas.

Productivity and Accuracy

Efficient distribution center design is paramount to an efficient supply chain. Penske redesigned the picking areas from a horseshoe layout to a straight line and replaced product numbers with photos and names. These steps resulted in pick accuracy jumping to 99.3%, inventory adjustments dropped off nearly by half and productivity increased by 17%.

Technology and Automation

Distribution centers relied on manual picking and sorting. Penske eliminated this constraint through Automated Storage and Retrieval System (ASRS) implementation. This technology optimizes order fulfillment, preserves product freshness, and removes manual process errors. Changes made a big impact: 40% efficiency gains, near-perfect order accuracy and enhanced proof-of-delivery and tracking capabilities that take visibility to the next level.

Labor Management

As the largest warehouse operating expense, labor demands strategic management. Penske implemented dynamic staffing models that flex with weekly and seasonal demand, ensuring the right capacity at the right time without overstaffing during slower periods.

Beyond scheduling optimization, Penske built a culture that retains talent. Restructured schedules, streamlined onboarding and targeted engagement initiatives have reduced costly turnover while creating a more stable, experienced workforce.

Reverse Logistics

The manufacturer’s reusable trays and carts do more than protect products and reduce costs – they are critical assets. Without trays, production stops. Effective reverse logistics ensure these containers flow continuously from delivery points back to manufacturing facilities.

Penske implemented electronic tracking where drivers record deliveries and pickups, giving the manufacturer instant visibility into container quantities and locations. The team coordinates routing to return empties to the correct facilities at the right time. Pilot programs are currently testing full automation to eliminate manual data entry.

Creating Supply Chain Continuity

Delivering fresh products on time across a complex network requires perfect synchronization. Penske eliminated silos between transportation and warehousing, creating integrated operations where communication flows instantly and teams work as one.

The impact is visibility at every step. When bakery production runs late or transit issues arise, drivers communicate delays immediately, giving warehouse teams time to adjust staffing, dock schedules and downstream commitments. This visibility creates end-to-end accountability: drivers and loaders own product quality from the manufacturing floor to final delivery.

Integration That Delivers Results

By integrating transportation, warehousing and technology, Penske transformed the manufacturer’s middle mile from a complexity challenge into a competitive advantage.

The results speak for themselves: 99.3% picking accuracy, 17% productivity gains, reduced inventory adjustments and measurably improved on-time delivery performance.

More importantly, the manufacturer gained complete supply chain visibility and agility to respond to disruptions before they impact customers.

Ready to transform your middle mile into a competitive advantage? Contact us.