For decades, Covenant customers have remained loyal in large part due to the company’s personalized approach to business and reliable service portfolio. With the recent addition of comprehensive Distribution Center Management (DCM) services, however, customers are finding a new reason to grow and expand their business partnership with Covenant.
A key benefit that customers have realized with Covenant’s DCM solutions has been continuous improvement – which is repeatedly delivering meaningful value to customers’ operations and bottom lines. Covenant’s experienced team of operations, engineering, and technology resources work interactively with the customer’s logistics organization to develop and implement solutions tailored to the specific needs of their organization.
The first area of interest is related to customers’ inventory.
“We assign an engineering team that examines everything from a building’s layout to the product velocities. Then we custom-design the space for facility optimization,” said Matthews.
Next up is inventory accuracy, which Matthews says his team improves using a combination of predictive analytics, historic sales cycles, frequent cross-checks and more.
Using the Warehouse Management Solution (WMS) Körber (formerly HighJump), Covenant can identify the operational areas in which a distribution center excels, as well as areas that warrant greater attention.
“The technology sheds light on any problems in a warehouse, but it’s our relationships with customers that allow us to take the action needed to turn the metrics around,” said Matthews.
Results are driven by a team of leaders trained in programs such as Continuous Process Improvement, 6S, Six Sigma and the Association for Supply Chain Management’s APICS certification program. Covenant has applied this knowledge to distribution centers across the country with eye-opening outcomes.
“By examining how products have historically moved and using the intelligence gained from our technology, we can see future and seasonal patterns that allow us to store goods in an optimized manner, staff appropriately and ensure we have the right items in stock for on-time deliveries.”
Prior to partnering with Covenant, customers reported average inventory accuracy in the low 90 percent range. Following Covenant’s support, those same customers now report a rate of 99 percent and above.
Another pain point customers reported prior to partnering with Covenant involved on-time shipping and shipping accuracy.
“Everything we do to optimize the inventory process primes goods for optimal movement, which helps us reduce shipping delays,” said Matthews.
Now reporting 99-percent overall on-time shipping and shipping accuracy rates – up from 70 percent and 80 percent, respectively – Matthews credits solid outbound processes and technology that prevents errors. The team also conducts “final mile audits” on every load to identify problems before delivery.
“Depending on the situation, we have a variety of early interventions in place to ensure timely and accurate shipping,” Matthews explained.
Dock to Stock
When goods are delivered to a distribution center’s loading bay, the clocks starts ticking until all items are shelved. When time means money, it’s clear that a faster, more efficient re-stocking process is valuable.
“We’ve improved the ‘dock-to-stock’ process significantly. What used to take some customers up to 24 hours, we complete in two hours or less.”
The company also provides significant intangible benefits to customers.
“First and foremost is safety,” said Matthews. “We have mandatory trainings and processes in place to prevent incidents. More than three-quarters of our sites have gone over a year without an incident.”
Next up is the savings on human capital. Because Covenant’s distribution centers are so well managed and advanced automation solutions are incorporated whenever possible, staffing is highly efficient, generating even greater savings.
Beyond these gains, Matthews reports that his team’s relationships with their clients drive further intangible value.
“Clients commonly tell us that they can’t tell the difference between us and them,” Matthews laughed. “We all look forward to our weekly reviews, where we focus on where we are and how we can improve further. Covenant does an excellent job of delivering meaningful outcomes and driving lasting partnerships.”