Outsourcing its transportation and logistics function is allowing snack manufacturer Lenny & Larry's to better manage growth and focus on its core competency: making cookies.
Victoria Kickham started her career as a newspaper reporter in the Boston area before moving into B2B journalism. She has covered manufacturing, distribution and supply chain issues for a variety of publications in the industrial and electronics sectors, and now writes about everything from forklift batteries to omnichannel business trends for DC Velocity.
Snack manufacturer Lenny & Larry's faced a classic "good news, bad news" scenario just a few years ago. The good news was that demand was skyrocketing among the health and wellness set for its flagship protein-packed cookie, opening new markets for the product nationwide. The bad news was that the Southern California-based company was crumbling under the weight of transportation and logistics challenges as it worked to get cookie orders out the door faster than ever before.
That's when leaders at Lenny & Larry's turned to third-party logistics service provider (3PL) BlueGrace Logistics, which now manages all of the manufacturer's transportation planning and execution, allowing Lenny & Larry's to focus on product development and expansion—all while reducing costs and enhancing on-time performance rates.
"BlueGrace [has] allowed Lenny & Larry's to focus on making the best protein cookies and improving internal operations while providing a consistent and stable platform for managing all outbound logistics," says Andrew Klucznik, sales and operations planning director for Lenny & Larry's. "[It has] also very effectively reduced logistics costs and pushed on-time performance to world-class levels."
One measure of success: Lenny & Larry's is now a nationwide distributor to Target, having been considered an "at-risk vendor" by the retail giant just a few years ago.
THE PROBLEM: LOW VISIBILITY, OUTDATED SYSTEMS
Bodybuilder and former American Gladiator competitor Benny "Cyclone" Turner founded Lenny & Larry's in 1993 with the goal of introducing a tasty, healthy protein-based snack to the health and wellness market. Over the next several years, the snack maker experienced what company leaders describe as "explosive growth" that left it bursting at the seams in 2013. During that period, Lenny & Larry's went from handling just a few shipments a day to local West Coast markets, to coordinating upward of 20 shipments a day for delivery nationwide.
Company leaders quickly realized that their distribution infrastructure wasn't up to snuff and that handling logistics processes manually was too much of a burden for the small but fast-growing business. The firm's on-time and must-arrive-by-date (MABD) performance rates were low, keeping it from meeting the stringent demands of many major retailers. Managing its logistics challenges was distracting the company from its main focus: making cookies.
THE SOLUTION: NEW SOFTWARE AND A PROCESS OVERHAUL
Lenny & Larry's now uses BlueGrace Logistics to manage all of its transportation planning and execution, allowing the manufacturer to focus on product development and expansion.
Riverview, Fla.-based BlueGrace entered the picture around 2016, first implementing its standalone transportation management platform, BlueShip, which provided Lenny & Larry's employees with a more streamlined system for booking shipments. The partnership grew from there, as BlueGrace uncovered deeper problems that were keeping the manufacturer from meeting some of its production and delivery goals. As BlueGrace Regional Vice President Christopher Kupillas explains, Lenny & Larry's needed to get a better handle on the data in its IT (information technology) system as a way to provide a fuller picture and more forward-looking view of orders and delivery requirements. That is to say, the firm needed to do more than just automate the shipping process in order to keep up with its growth.
"A lot of the things they did as a smaller business, moving two to three shipments a day, just wouldn't work anymore," Kupillas says. "When you start moving 20, 30, 40 shipments a day, you have to do some things to adjust to that."
BlueGrace took on a larger role by automating its client's entire logistics function. The 3PL started by eliminating cumbersome paperwork and introducing best practices and continuous-improvement processes for transportation and logistics. Its team of logistics experts drilled down to the on-time performance rates of specific customer locations and compared them with carrier-performance ratings to create an optimal carrier mix. They then developed new ship-date logic that matched the Lenny & Larry's production schedule, helping the firm reach on-time rates of more than 95 percent with big-box retailers and grocers—an impressive jump from rates that hovered around 50 percent prior to working with BlueGrace, leaders from both companies say.
"Their support immediately alleviated the workload on our warehouse team, who could now focus on improving the order-fulfillment processes, accuracy of orders, and fill rates," Klucznik explains. "Aside from small parcels, which are still booked internally, BlueGrace manages the booking of all outbound transportation for our two distribution centers—one on the West Coast and one on the East Coast. Once a week, we meet with BlueGrace to review the on-time performance to our customers as well as the cost performance of our distribution network."
THE OUTLOOK: MORE GROWTH AHEAD
Lenny & Larry's ships about a half-million pounds of product every week to more than 100 retailers and is more focused on growth than ever before, thanks to its new logistics partnership. Klucznik says BlueGrace acts as an extension of Lenny & Larry's, and that the two partners are working together to grow the business. Kupillas agrees, and says the opening of the company's East Coast distribution center in late 2018 perfectly illustrates the point.
BlueGrace was instrumental in the decision to open the East Coast facility, thanks to a cost-analysis study that grew out of its routine analysis of its client's data. More than a year ago, BlueGrace's logistics experts saw that the manufacturer was planning a new-product launch that would affect the weight, class, and mileage of its shipments—ultimately increasing shipping costs—Kupillas explains. That led the BlueGrace team to run some numbers to see whether adding an East Coast facility would mitigate the cost increases that were coming down the pike. Kupillas says the team found that a new facility would dramatically reduce costs for Lenny & Larry's on a cost-per-cookie basis; more importantly, it would help get the product to the customer faster, improving on-time delivery rates.
"Lenny & Larry's is a very future-focused company that is always looking on the horizon and focused on continuous improvement," he says, emphasizing the value to BlueGrace of knowing ahead of time how the new-product launch would affect shipping and logistics. Essentially, it allowed the two companies to develop a longer-term strategy for the snack maker's growth.
"If you can have those strategic conversations from a high level, as well as conversations at the tactical level ... it's the best possible scenario," Kupillas adds.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.