Pooling or supply pooling comprises grouping goods from several commercial or industrial companies for delivery or storage of products. Pooling empowers superior savings, better service, and optimization of stock levels for a sustainable chain of supply.
Pooling solutions are collaborative solutions that contribute value by grouping transport and logistics processes together. In this, deliveries are pooled from multiple manufacturers of compatible products heading for matching networks of distribution.
Shared Chain of Supply
Pooling amounts to a partnership and all partners play crucial roles. At one end, the company chooses its customers and delivery points and also monitors performance. At the other end, end-clients or distributors submit orders for confirmation and rate the service.
The crucial function of successful pooling begins with selecting partners who manufacture similar products for the same customer with common delivery and starting points. Great relationships must also be enabled with end clients or distributors who can power efficiency.
Also, one will require the best logistics partner who is an expert for overall coordination, such as setting up technology and processes for managing workflow and tracking progress.
The partners will set up a common plan. The pooling will be tested first with a few stakeholders, and once the pool is established, they will proceed further and always try to upgrade services.
Importance of Pooling
Companies of all sizes can benefit from pooling. For SMEs, a shared chain of supply implies that one can control costs of transport and enhance service. For large companies, there is an addition of value through more recurrent deliveries.
The different stages needed for supply pooling must be conducted with pragmatism and the help of a provider of logistics. The latter takes receipt of industrial goods, prepares them, loads them and delivers them. Rotations are designed to avoid shortages in the store or retail facilities, which might impact the end customer.
Through the pooling of logistical resources (materials, humans, trucks and warehouses), more profit can be garnered by stakeholders of supply pooling by reducing costs of storage and ensuring the superior in-store display of goods with high rotation.
How compatible are stakeholders of pooling?
● Pooling companies should ensure the compatibility of logistics with regard to their customers and products.
● Requests should be compatible as per time frame and volume. In some shops and big retail stores, seasonality is highly crucial for the management of volume. Therefore, there exist concepts of fixed distribution (no alterations in delivered volumes) and variable (bigger volumes in rush seasons) distribution pools.
● The organization of logistics will always be compatible when manufacturing companies work together and make use of joint warehouses and production resources.
● It is the responsibility of a project manager to lead a system made of many different partners on different sites. This manager serves as the reference person for selecting the right solution and best provider of logistics for back-office work of IT, transport, and storage. It is a third party that does not belong to any of these partners that will find it easier to arbitrate any conflicts of interest between the partners.
● Projects of supply pooling feature high ROI (Return on Investment) since they have low implementation costs.
Benefits of Pooling
● Superior service
When the flows of packaging and delivery are combined, they are two to five times more frequent. With this, products are readily available when required resulting in a 0.5% to 2% rise in service.
● Optimal stock
Superior reactivity ensures optimization of stock levels that reduce the storage space required as well as the risk of outages. Less inventory needs less expenses for storage and frees much space in warehouses that are crowded.
● Cost-effective and reliable
When trucks that are fully loaded run-on fixed schedules, they result in less cost of transport and more reliable deliveries because of the partnership between manufacturers.
● Less CO2
Pooling benefits the environment by reducing the use of trucks by 30%. This not only lowers congestion of traffic but also cuts emissions by a substantial degree.
Impact of Pooling of Supply
From the point of view of industrial companies, pooling of supply reduces logistics costs substantially, such as those costs of storage of finished products. For example, companies that use 20 platforms in Germany and deliver around 20 pallets in 20 trips would be restricted to one stop in a single trip when pooling is implemented.
The companies can also reduce their carbon footprint substantially. As per statistics, mileage is lowered by 20%, and carbon dioxide emission is also cut by the same percentage.
Management of the supply chain also becomes easier with all stakeholders enjoying better visibility of both stock levels and sales, provided that all things are located in the same point. The distributor knows about levels of stock in real-time with regard to each product, such as rotations and sales.
Pooling also suits small suppliers. Using this, they can better manage the costs of logistics as they are pooled and can deliver to specialized or larger retailers.
With regard to distributors, pooling solutions empower a favourable relationship with partners. In fact, logisticians and suppliers have the responsibility to safeguard any commodities stored within their platform. Even distributors can save much cost on personnel by overseeing pooling operations.
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