A few weeks ago, I spoke with Keli Sanford, Logistics Manager at Ocean Spray. In that role, Keli is responsible for inbound raw materials going into the plant and finished goods leaving the plant, as well as overseeing Canadian warehousing and transportation. In her years at Ocean Spray, Keli has had a lot of first-hand experience with their business relationship with CH Robinson.
Ocean Spray has a two-fold relationship with CH Robinson. First, the company uses CH Robinson as a carrier. CH Robinson has been a top volume carrier for Ocean Spray for over 15 years and the relationship has developed into a partnership. Additionally, Ocean Spray uses TMC (CH Robinson’s transportation management system [TMS]) as managed TMS in house.
Prior to partnering with TMC for a managed freight solution, Ocean Spray’s transportation management was a decentralized system. This meant that it was managed at individual distribution centers. Under this plan, each region was working with local carriers with little corporate oversight. To better succeed as a company, it moved to a 3PL relationship (company unnamed) to manage its transportation. This strategy consisted of a 3PL managing Ocean Spray’s carrier relationships. The 3PL worked remotely from its headquarters and had little interaction with Ocean Spray’s operations, customer service, or supply chain teams. However, Ocean Spray was still looking for a more efficient and productive system.
In deciding the best course of action, Ocean Spray initially looked at purchasing software to handle its transportation management needs but couldn’t find the right fit. Ocean Spray also looked at web-based solutions for inbound, but these solutions still didn’t work well for all of its needs. In the end, the company decided on TMC; the key piece was an onsite team and the ability to work together side-by-side with Ocean Spray’s transportation employees.
The implementation process was easier than expected, mostly due to the fact that the TMC team was in the building. Once the solution was up and running, Ocean Spray began to see the benefits. On-time delivery is clearly one of the most important metrics for any company that is shipping goods. After the implementation, Ocean Spray saw its on-time delivery rates increase to around 95 percent. This had two major impacts. First, it made the sales team happy because it drove better collaboration with customers and ensured reliable deliveries. Additionally, it improved customer loyalty.
The second benefit the company saw was an increase in first carrier acceptance rate. When looking at a scorecard of shippers and carriers, first-time acceptance rate can be crucial. Ocean spray has seen acceptance rates increase which has resulted in cost savings on its transportation spend.
TMC has managed about 70 percent of Ocean Spray’s freight volume historically. The remaining 30 percent of business is vendor managed raw materials, retail customer pick-up, or business that just doesn’t make sense to run through TMC. Ocean Spray has done a phased approach to integrate through TMC, whether that is transportation modes or business units. For example, the company needs a business case to integrate (if there is 1 mode and only 1 carrier, it probably won’t migrate over). In 2018, TMC managed 80,000 loads for Ocean Spray. And, over the last two years, TMC business with Ocean Spray has grown by over 9% (attributed to new business) and now TMC manages over $55 million of Ocean Spray’s spend. The majority of the growth has come from TMC adapting to Ocean Spray’s needs with innovative solutions, including sustainability efforts.
One of the main benefits of working with a trusted partner for 15+ years is communication. For Ocean Spray, working with TMC has been a great relationship. As Keli pointed out, because of the length of the relationship, Ocean Spray still talks to most of the same people in management for every project. Additionally, Ocean Spray gets an instant response to inquiries. The depth of the relationship has resulted in a joint effort to build the transportation department over the years. Working side by side, day in and day out, infuses a sense of trust for both Ocean Spray and TMC.
Looking ahead, the relationship between the two companies shows signs of growth. TMC has shown a track of record of success with Ocean Spray. According to Ocean Spray, the people part of the relationship has been a huge factor; they are dedicated to their account and have a dedicated team for Ocean Spray. This ensures that they know who to reach out to for immediate answers.
On the TMC side, technology and the pace of change are key for continued success with Ocean Spray. The relationship helps the Ocean Spray supply chain get ready for what is next. Working side by side, the two companies will be able to become more efficient and do more to drive business results.
