Pactiv, headquartered in Lake Forest, Illinois, is a leading manufacturer and distributor of food service and food packaging products. The company’s typical warehouse has 300-400 trailers in the yard, with about 50 inbounds and 50 outbounds per day. This case study is a collaboration with Chris Snow, the fleet manager for Pactiv’s Mid-West region, to discuss the company’s recent yard management process improvement project and the benefits Pactiv obtained from implementing the system across 12 facilities.
Legacy Yard Management
Pactiv was utilizing Microsoft Excel, saved on a shared drive, to track trailer inventory in its yards. Although Excel is a ubiquitous tool for data management, its use in this situation had shortcomings. For example, Pactiv had some issues with data entry, workers improperly saving file changes to the shared drive, and other processes that left room for improvements. In particular, the company wanted to better track trailers and more easily identify specific trailer locations in the yard. And from a hard-cost of operations perspective, they wanted to reduce trailer detention times and the $25-$100 daily fee they get charged by carriers after the initial 72 hours.
Selecting a Yard Management System
Pactiv evaluated the yard management systems (YMS) available on the market and chose Kaleris Advanced YMS. The Pactiv team liked Kaleris’ method of GPS coordination of trailer location and the security benefits obtained from a spotter (yard truck) simply driving a loop around the yard to check in the trailers. Also, Kaleris workers came out to the site at the time of implementation and developed a map of the yard that offers an intuitive display of trailers and status. For example, the system’s color-coding capabilities allow the user to set parameters for different criteria such as trailer time since check-in, etc. The system also allowed users to track the spotters and their location in the yard. Overall, the tracking capabilities were exceptional, reporting was robust, and the system was user-friendly.
YMS Deployment and Sources of ROI
Pactiv initially deployed the Kaleris YMS at one of its smaller facilities to learn from the process, then moved on to the larger, more complex facilities. In all, the YMS has been deployed at 12 Pactiv facilities from coast to coast. The YMS system took about 6-8 weeks to get up and running at a facility with the setting up of attributes and system configurations being the most time-consuming parts of the process. Hardware needs were negligible but included Toughbooks in the yard trucks, tags for the permanent trailers, and magnetic tags for the other trailers. Pactiv was able to reduce trailer detention fees from carriers by 75-80 percent with the help of the new YMS.
Pactiv was able to obtain hard savings from an approximate 25 percent reduction in spotter labor. I categorize this as hard savings because Pactiv uses a third-party vendor for spotter trucks and labor, and the demand for spotters went from 24 hours a day to 16-20 hours a day. For example, they may have gone from two twelve-hour spotters down to two eight-hour spotters at a given facility. And at some locations, they reduced one spotter on a given shift. Pactiv also obtained soft savings from the new YMS. In the past, Pactiv would periodically have to reload trailers due to improperly loading a multimodal container for a destination outside of the trailer’s destination zone (for example, loading a west coast container for an east coast destination). The new system allows notes to be added to objects in the system, providing visibility to trailer movement constraints. Finally, there were soft labor savings from reducing the need for warehouse workers to manually track down trailers.
Some Pactiv end-users were initially skeptical of the new YMS. But the users are now happy with the new system and its ease of use. Going forward, Pactiv is evaluating the case for integrating its warehouse management system into its YMS. They are also looking at ways to use the Kaleris YMS to track the productivity of truck movements from the company’s manufacturing facility to the distribution centers and to obtain better estimates of arrival times at the distribution center gates