This case study may leave you stumped
Did you know? A tree survives and thrives by extracting the nutrients in the soil. Yet, when a tree is harvested for lumber the stump is often left behind. Our client has developed a way to harvest nutrients from unused or discarded tree stumps. These chemicals are used to make products that range from solvents and turpentines all the way to cosmetics, depending on how many times the liquid is run through their filtration system.
When we were asked to help them with their supply-chain, we quickly identified two challenges. The first was to reduce expenses. The second was to ensure that their carriers were delivering their products more carefully. Safety is of the utmost importance in a chemical environment and can often be overlooked by carriers.
As we began our diagnosis process, we uncovered the third challenge two of their chemical plants that were 70 miles apart. The client would run specialized tanker trailers with chemicals between the two plants. Frequently, the chemical was then transported back to the originating plant to run through multiple filtration processes. One of the biggest challenges they faced in this process was the loading and unloading time.
This time-frame to fill and drain the tankers ranged from 90 minutes to 2.5 hours. Because their current process involved hiring outside common carriers, drivers would wait countless hours for loading and unloading to occur. This created tremendous inefficiencies and resulted in higher costs, with each load taking more than 7 hours to complete a full cycle.
RedStone Logistics Solution
Our solution included the elimination of outside common carriers and transitioning the client to a “Dedicated Contract Carrier (DCC)” environment. This DCC solution included increasing the number of trailers and securing spotting equipment to move trailers in and around the chemical plant. By having their own personnel move the trailers in and around the plant they significantly reduced the risk of new, inexperienced drivers trying to maneuver around tight spaces within the chemical plants. The additional trailers also enabled the long load and unload processes to be performed faster with the elimination of outside driver waiting time.
Creating a solution that involved a Dedicated Contract Carrier not only made things easier operationally, it also cut costs. This solved our first and third challenges. We were able to solve their second problem by utilizing experienced drivers moving products back-and-forth
When you have shipments that only travel 70 miles in each direction and are loaded in each direction more than 85% of the time, it is almost always more cost-effective to do this either with a private fleet or a DCC solution. The client did not want to be in the trucking business, so ultimately the DCC solution was the right choice.
Finishing On Top
The DCC solution created tremendous efficiencies, including delivering the product at a much lower cost in a much safer environment. As a result the savings generated were in excess of 17%, leaving our customer very satisfied with the improved flow in the cycle of chemicals and savings.
MORE ABOUT OUR CUSTOMER
Our client is a chemical company in the southeastern United States that extracts chemicals from tree stumps after the tree has been harvested for lumber. They are an industry leader in high performance rosin and polyterpene resins and have been in business for over 100 years.