CHEP and Convoy: A Partnership for Sustainable Supply Chain Efficiency
Technology Category
- Functional Applications - Fleet Management Systems (FMS)
- Functional Applications - Transportation Management Systems (TMS)
Applicable Industries
- Automotive
- Transportation
Applicable Functions
- Facility Management
- Logistics & Transportation
Use Cases
- Automatic Palletizing & Depalletizing Systems
- Supply Chain Visibility
About The Customer
CHEP is an Australian pallet, crate, and container pooling company that began U.S. operations in 1990. It now has more than 110 million pallets circulating in North America. The company works in more than 500 supply chain points in North America, including its own facilities as well as operations set up in customer locations. It supplies pallets to approximately 14,000 manufacturing locations in the United States. These pallets are then shipped to more than 19,000 retail locations. CHEP collects pallets from these locations and refurbishes them to be used again. The company is committed to sustainability and uses its visibility into its customers’ networks to identify lanes of opportunity, where the shipper’s private fleet has an empty backhaul.
The Challenge
CHEP, an Australian pallet, crate, and container pooling company, faced a significant challenge in managing the relocation of its pallets from surplus markets to deficit markets. This process resulted in a considerable amount of carbon waste in the form of empty miles. The company, which operates in more than 500 supply chain points in North America and supplies pallets to approximately 14,000 manufacturing locations in the United States, found the management of these pallets to be an incredibly complex task. The pallets are taken in by customers, loaded with freight, shipped to distribution centers and warehouses, deconsolidated, reconsolidated, and then sent further downstream to more than 19,000 retail locations. CHEP collects pallets from these locations and refurbishes them to be used again. The imbalance in freight flows in the United States, due to uneven distribution of production and consumption, necessitated the relocation of pallets, resulting in longer lengths of haul between CHEP's own supply chain points.
The Solution
To address this challenge, CHEP partnered with Convoy, a digital freight network. Convoy sourced reliable capacity to run optimized routes that helped CHEP balance their pallet relocation and eliminate empty miles, thereby lowering transportation costs. Convoy's batching program established optimized loops for carriers to run in, efficiently utilizing carrier assets and reducing CHEP's transportation costs. In addition, Convoy used its drop trailer program, Convoy Go, to increase fluidity and build a virtual dedicated fleet servicing CHEP's freight. Convoy also provided facility feedback from carriers, identifying opportunities to improve the efficiency of CHEP facilities. This solution not only addressed the challenge of empty miles but also contributed to CHEP's mission of eliminating physical waste and driving out other inefficiencies in the supply chain.
Operational Impact
Quantitative Benefit
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