Due to the rise of home delivery in food retail, Jumbo, an expert in fulfilment, faced new challenges. Together with Pipple, they mastered the finer points of home delivery.
Those who have their groceries delivered to their homes do not want a container full of sprinkles in front of the door one day and one with toilet paper the next. It should be a crate, filled with small units. Nothing should be missing from the shopping list. And the chips should be on top of the carton of milk and not the other way around.
Jumbo was clear early on that delivering orders to consumers is a completely different story than supplying supermarkets. To cope with the growth of e-commerce, they built two e-commerce fulfillment centers (EFCs). Making it function as effectively as a classic distribution centre is a learning process, says Rob Jacobs, Manager Supply Chain Development & Performance at Jumbo. “In food retail, the margins are razor thin and the numbers are large. Ten seconds of waste or profit are already substantial.”
Jumbo therefore wanted to be able to experiment with process adjustments to its heart’s content, without disrupting the actual workflow. For this they asked Pipple to recreate their EFC virtually. Within fourteen weeks there was a perfect model of reality.
Then the simulation could begin: They looked at the effect of separate collection areas for fast and slow-moving goods. And they tested what different replenishment times did to the stocks. Jacobs: “The simulations showed improvements that we hadn’t even thought of.” It brought Jumbo a lot: fewer crates are now needed, the productivity of the EFCs has improved and the warehouse is filled faster and better. With some adjustments, they can also use the simulation model to set up future EFCs.
In addition to the results, Jacobs is particularly pleased with Pipple’s flexible attitude. Because he wanted to work agile, after each intermediate phase, he reviewed what was needed from Pipple to further improve. “Not ideal for a party like Pipple, but that was no problem for them.” Moreover, Jacobs said he was a strict business owner. “I didn’t have anything to do with just a great regression analysis. Each intermediate product had to have immediately applicable value.” Pipple succeeded. Jacobs finds it very special that Pipple mastered Jumbo’s simulation software so quickly. “That showed a huge drive, which was contagious to the rest of the team.” He will call in Pipple more often. “They don’t make it more complex than they need to be. If it can be done on the back of a beer mat, they do. That mentality fits well with Jumbo DNA.”