Penske Logistics, which operates both ambient temperature and dedicated cold storage facilities for fresh channel clients, relies on technology, associate expertise and experience to drive operations for its customers, which include grocers and convenience stores.
Our expertise includes lean supply chain management to streamline processes, reduce costs, and improve productivity. Our core competency includes running warehouses.
Leading grocers see that specialized services and attention from a third-party logistics (3PL) provider like Penske drive value. Outsourcing logistics gives the grocer time to focus on their customers and the products they buy, while the 3PL focuses on getting the product to the store.
Penske has warehouse facilities to serve customers and can implement clean, safe and scalable warehousing solutions at our customers' locations. We use our expertise to drive efficiencies within the warehouse walls and throughout the movement of goods. Here are eight ways Penske streamlines cold storage and the fresh channel:
1. Network Management
Customers increasingly want to get their storage facilities closer to the grocery stores to ensure freshness. Penske helps its customers evaluate their overall distribution network and the role of national vs. regional distribution.
2. Shrink Reduction
Reducing the amount of shrinkage and product loss is crucial in the cold chain. Accurate shipping and receiving are vital to maximizing sales and preventing potential losses and will enhance business success.
To minimize shrinkage, Penske uses a robust warehouse management system (WMS) and can either use its own technology or its customer's.
Penske also leverages checks and balances within the technology to ensure proper product handling. In addition, it provides employees with extensive training to minimize the risk of product damage or contamination.
3. Employee Training
All employees within a Penske-managed cold storage facility undergo training on overall food safety and sanitation. Employees are also educated on the Food Safety Modernization Act (FSMA), which outlines strict record-keeping and safety procedures, so they understand cross-contamination and the risks associated with food.
Within each distribution center, several employees are Hazard Analysis Critical Control Point-certified (HACCP). HACCP, administered by the Food and Drug Administration, is a management system in which food safety is addressed through the analysis and control of biological, chemical and physical hazards. This includes raw material production, procurement and handling, manufacturing, distribution and consumption of the finished product.
By managing the distribution center as well as the dedicated contract carriage, Penske can collaborate better with the cold storage transportation group and increase visibility into the operation. This improves on-time deliveries and provides cost savings.
5. Efficient Slotting Patterns
The layout and slotting of product can drive replenishment rates and the efficient movement of goods within the warehouse. How product is slotted varies by location. For one distribution center, Penske created a system where three pallets could be placed in a rack at one time.
6. Standard Operating Procedures
Penske can create and maintain efficiency through its standard operating procedures, which may cover everything from how products are received, stored and put away to how they are picked, packed and shipped. This maintains quality throughout the supply chain.
For example, Penske creates standardized processes around receiving through its WMS, which is integrated with its enterprise resource planning (ERP) system that gets the orders.
This allows us to know what's on the trailer before it gets to the dock.
That enables Penske to be more efficient when offloading and slotting product. We place the heaviest items on the bottom of the pallet, so when they unload it at the store, they can do it most efficiently.
7. Cross-Docking Operations
Within facilities, Penske Logistics handles cross-docking operations for fresh food and flowers. Cross-docking is the practice of unloading product from an inbound truck and loading it directly onto an outbound truck, reducing the need to store things in a warehouse.
At one location, cross-docking helps bring fresh-baked goods, including donuts, cookies, and brownies, to stores each day. Our warehouse is about two miles from the bakery, which is baking daily.
The bulk-baked goods arrive at the warehouse via shuttle loads and are cross-docked in a temperature-controlled area, with Penske putting together the racks that will be delivered to each individual store.
Then we're consolidating truck routes based on product need for each store.
The building also includes a 30,000-square-foot refrigerator, which stores sandwiches and salads for daily deliveries. We build a store order of the required amount of sandwiches and salads. Each full bin with cable ties to ensure no one can tamper with the food products.
8. Product Thawing
For retail outlets that offer freshly prepared products in the store, Penske can deliver flash-frozen goods, which it thaws before shipping to the stores, so they can be baked on site.
We manage the regional distribution centers, consolidated distribution centers (CDC), and dedicated contract carriage to deliver products to the stores for one customer.
Within each CDC, we are taking the product, such as croissants, that are baked to 70 to 75%, freezing them and sending them to one of our cold storage facilities. Based on demand, we then take them from a freezer to a refrigerated area, then to the trailers to deliver the thawed product to the stores. At that point, they do the final bake at the store.
Taking a Multipronged Approach
By combining various methods to drive efficiency, Penske can provide reliable service and a quality product that meet retailers' demands with low shrinkage levels.
