Overview
A well-known British bakery chain, recognised for its nationwide presence and fast-moving retail model, was managing high volumes of packaged goods across multiple distribution centres. With limited storage capacity and the pressure of daily replenishment cycles, their supply chain relied heavily on third-party logistics (3PL) support to maintain continuity.
The Challenge
While outsourcing to 3PL providers offered flexibility in the past, it came at a significant ongoing cost, particularly with bulky packaging items that consumed valuable space. Storage fees of £2.50 to £3.50 per pallet per week added up quickly across large volumes, despite the bakery chain being on a fixed-price supply contract. With an average stockholding of six weeks and a £2 million packaging contract, this translated into substantial unnecessary overhead. Notably, the client hadn’t identified this as a pressing issue, it was GM Packaging’s insight that brought the hidden cost to light.
The Solution
GM Packaging proposed a shift to a just-in-time delivery model, streamlining packaging flow directly into the client’s distribution centres. By aligning deliveries with real-time demand, the approach would remove the need for 3PL storage entirely, eliminating hidden fees and reducing stockholding levels without compromising service. Although the fixed pricing agreement prevented immediate implementation, the business case demonstrated a clear opportunity to unlock value through smarter demand management, reinforcing GM Packaging’s role not just as a supplier, but as a strategic partner committed to new efficiencies and driving bottom-line impact.
