Page 287 - Onboarding May 2017

Logistics

Freight Management

In 2015, CSCS freight initiatives generated $2.4M in savings to Apple Co-Op Members. Transportation costs are
reduced by leveraging third-party logistics providers (3PL’s), distributor shared savings programs, redistribution
services (ReD), and retarget analysis. Each program requires a comprehensive evaluation of freight cost, where
CSCS coordinates lane transitions that result in overall savings to the Apple Co-op Members.

3PL RFP
During the first quarter of 2015, the 3PL RFP strategy was introduced as a new freight savings initiative. A total of
1,200 freight lanes were analyzed as potential opportunities for freight cost reduction. By the end of 2015, CSCS
identified 40 lanes that contributed to $550K in freight savings for Apple Co-op Members.

Shared Savings Programs

CSCS collaborates with Applebee’s distributors to maximize the number of backhauls and distributor managed
lanes for the shared savings program. A total of $800K was generated through distributor freight programs and
returned to Co-op Members in the form of a rebate.

18 18 M
Redistribution 16 16 Å B J

Redistribution enables CSCS to consolidate less than truckload (LTL) shipments to distributors. Slow moving 14 14 H
products are reviewed periodically and redirected to ReD where applicable. By consolidating slow moving items, 12 12 Ç F
CSCS reduced freight costs to Apple Co-op Members by $900K. 10 10 É Ñ

Program Savings 8 8 Ñ É
6 6 F Ç
Retarget Analysis 6% 4 4 H Å
The retarget analysis is used as a way to maximize distributor 2 2 J M
purchase order size and to lower freight costs. In 2015, the 23% Redistribution 0 0 B
retarget analysis delivered a total of $150K in savings. 38% Shared Savings
3PL RFP
33% Retarget Analysis
$18.00
Produce $16.00

Compliance is an ongoing initiative for the produce program. CSCS monitors each produce distribution center to $14.00
ensure all mandated items sold to Applebee’s restaurants are purchased from approved suppliers. In 2016, we are $12.00
monitoring inventory and pricing monthly. Quarterly progress updates are sent to all distributors and Members. $10.00
$8.00
Distribution consolidation will allow us to further manage costs throughout the supply chain by targeting freight $6.00
lanes managed by distributors and aligning the suppliers and distributors to improve services levels. In the past $4.00
12 months, the number of produce distributors was consolidated from 106 to 95.
$2.00
$0
Q1 Q2 Q3 Q4
10