QSR Successfully Weathers West Coast Ports Slowdown with Help from HAVI

HAVI helped a quick-service restaurant (QSR) chain that risked significant disruption in supply as a result of a U.S. west coast ports slowdown, to leverage existing, former and new supplier relationships and planning technology tools to develop contingency plans for moving supply into the U.S. and mitigate impact of the shutdown.

CASE STUDY FOCUS: NETWORK OPTIMIZATION

QSR Successfully Weathers West Coast Ports Slowdown With Help From HAVI

A quick service restaurant (QSR) chain risked significant disruption in supply of more than 250 million items and an inability to execute several promotions as a result of a U.S. west coast ports slowdown. HAVI leveraged existing, former and new supplier relationships and planning technology tools to develop contingency plans for moving supply into the U.S., including identifying alternate points of entry and shipping options.

Challenge

A west coast ports labor dispute that began in fall 2014 and continued into early 2015 significantly impacted the flow of goods into the United States, disrupting thousands of supply chain operations. As ports slowed to a virtual crawl, goods became stranded in containers on ships and in dockyards. Retailers struggled to restock shelves as imports were delayed and consumers grew increasingly frustrated. The port slowdown could have caused significant disruption in supply for one leading QSR that imports millions of promotional premiums each year. The QSR gives away the premiums with purchases during a series of promotions in its U.S. restaurants and disruption in supply would have negatively impacted sales, disappointed consumers and tarnished the brand’s reputation.

Solution

The QSR sought help navigating this situation and looked to HAVI for assistance. The QSR knew HAVI had deep expertise in the foodservice industry and a proven track record for handling supply chain disruptions .

The QSR had been working with HAVI to coordinate management of thousands of multi-modal international and local freight shipments each year, including alignment of all supply chain partners and contingency planning. When the west coast

ports slowdown began to create bottlenecks for arriving ships, HAVI leveraged its diverse network of carriers and lanes to find alternative routes for the QSR’s cargo to enter the U.S. In some instances, HAVI used a Canadian shipping lane to route shipments to Vancouver and then transport them by truck into the U.S.

HAVI also used network planning technology to identify and plan several alternative routes and modes for incoming shipments and to mitigate the potential for disruption to supply. The company regularly monitored the worsening ports situation and proactively adjusted plans to accommodate likely increases in traffic or changing weather patterns that could further impact and delay shipments. While other businesses struggled to find carriers or capacity and transportation providers battled to keep up with demand, HAVI was able to leverage its strong partner network (and long history of working collaboratively with carriers) to secure trucks and rail cars that could move cargo into and across the U.S.

HAVI acted nimbly, creatively and tenaciously on behalf of the QSR to mitigate impacts of the ports slowdown. HAVI experts maintained strong communication with the QSR throughout the situation and the chain never experienced a break in supply.

During Q4 2014 and Ql 2015 – at the height of the slowdown – HAVI imported more than 250 million premiums for eight promotions and helped the QSR save more than $2.9 million in freight costs (additional costs that would have been incurred if HAVI did not have a diverse supplier base to leverage for moving cargo throughout the U.S.).

Benefits

Reduced costs/ impact of the shutdown – By leveraging its strategic partnerships and utilizing world-class planning

technology, HAVI was able to mitigate product flow disruptions and help the QSR save more than $2.9 million in freight costs.

  • Maintained supply – Despite the massive port slowdown, the QSR was able to import more than 1,200 sea containers (more than 250 million items) into the U.S. and support eight different national promotions from Q4 2014 through Ql 2015.
  • Protected the brand – HAVI enabled the QSR to deliver against its promotional calendar, maintain its reputation for assured supply across thousands of U.S. restaurant locations and deliver on its promise to provide premium giveaways to its customers.