Takes Giant Step, Takes Giant Step,
and the Top Prize and the Top Prize
For this year’s Supply Chain Innovation Award, first place goes to Ahold USA and its partners —
ES3 and Del Monte Foods—for a distribution system that streamlines order-to-store deliveries from
days to hours.
hen you’ve got a problem or
challenge, you can tinker
with it, massage it, slap a
Band-aid on it—or you can
go back to the drawing
board, determine where you went wrong
and start over from scratch. Ahold USA, Del
Monte Foods and ES3 did just that. They figured that the traditional method of distributing manufacturer’s product to grocery
stores was a tried-and-failed process. Wasteful of time, money and resources, there had
to be a better way, and indeed there is.
Just off Interstate 83 in York, Pa., stands
what is said to be the world’s largest grocery
warehouse. Through it passes food products destined for Ahold’s supermarkets—
and from it come this year’s Supply Chain
Innovation Award winners.
The direct-to-store vision was to create a
streamlined supply solution for the grocery
industry that eliminated a distribution cen-
ter and leg of transportation. By leveraging
ES3’s scale, manufacturers like Del Monte
Foods (and others) and Ahold USA—whose
supermarket portfolio includes Giant Food
Stores—combined their mixing centers and
distribution centers into one large facility.
This streamlining of the supply chain
requires scale, automation, information
technology, and collaboration. Calling their
initiative unprecedented, this year’s winners
say it has resulted in a synchronized, efficient, end-to-end supply chain solution that
is faster, cheaper and greener than the current supply chain models.
The impact? Combining multiple manu-
facturers’ mixing centers and a retail distri-
bution center into a single facility has
resulted in savings of more than 30 percent
of supply chain costs for both the participat-
ing manufacturers and retailers. Addition-
ally, retailers are seeing savings in store
labor as selected pallets are better organ-
ized to align with store layouts and more
accurately picked due to automation.