In today’s fast-paced supply chain environment, efficiency, accuracy, and cost-effectiveness are crucial. TBL8 Logistics recently partnered with a Fortune 250 client to turn around their distribution center operations. This case study dives into the challenges they faced, the innovative solutions they implemented, and the impressive outcomes achieved.

Background: Challenges at the Distribution Center

The client’s distribution center was struggling with several significant issues:

• Inefficient Picking and Loading: These processes were causing costly delays.
• Poor Inventory Visibility: Frequent stockouts and overages made inventory management challenging.
• Lack of Auditing: Without robust audit procedures, loading and receiving inaccuracies were common.
• Inadequate Quality Controls: Product damage was on the rise due to inconsistent handling practices.

With these issues directly impacting productivity and profitability, the client looked to TBL8 Logistics for solutions to streamline operations and improve quality.

Solutions Implemented by TBL8 Logistics

TBL8 approached the project with a mix of innovative pay structure changes and process optimizations to address the center’s key pain points.

1. Base + Pay Model: TBL8 introduced a new pay model that incentivized productivity:

   • Employees received a base of $100 per day, with added bonuses of $20 per truck loaded, $10 per truck unloaded, and $0.06 per case picked.
   • This model fostered a more motivated workforce, directly linking pay to performance.

2. Process Optimization:

   • Enhanced Auditing: Supervisors and forklift operators now reviewed all product codes and quantities before loading, minimizing errors.
   • Receiving Quality Standards: Implementing a 360-degree inspection on all pallets improved the quality of received goods.
   • Standard Operating Procedure (SOP) Reviews: Whenever mistakes were detected, operators were retrained or SOPs were updated to prevent future issues.

Key Outcomes Achieved

TBL8’s strategy delivered substantial improvements across several key performance indicators:

• Cycle Time: Reduced by 35%, from 2.19 hours to 1.42 hours, allowing for quicker order processing.
• In-Transit Damage: Improved by 74%, reducing damage rates from 2.63% to 0.66%.
• Throughput: Increased by 30%, with throughput jumping from 71.56% to 92.9%.
• Shipment Accuracy: Achieved a 95% reduction in misshipments, boosting accuracy from 87.06% to 99.42%.
• Volume: Saw a 37% increase, from 15.4 million units to 21.1 million units.

These improvements also led to significant cost savings:

• Cost Per Case: Reduced by 15%, dropping from $0.20 to $0.17.
• Overage Product Loss: Reduced by 88%, from $29,000 to $3,500.
• Product Breakage: Lowered by 44%, from $73,000 to $41,000.

Conclusion

Through innovative compensation, targeted process improvements, and meticulous quality control, TBL8 Logistics transformed the distribution center’s operations. The results? Enhanced efficiency, reduced costs, and a noticeable boost in customer satisfaction. For companies facing similar challenges, TBL8’s approach provides a proven roadmap for sustainable growth in warehouse and distribution management.

For more information or to discuss how TBL8 can help your organization, schedule a call with us today.