Nisa-Today’s has awarded the £500m contract to DHL Supply Chain to manage its distribution requirements.
The contract, which will commence from April 2011 and run for seven years, will see DHL handle all of Nisa-Today’s Central Distribution logistics to its national members.
The news come just a week after the board at Nisa-Today’s rejected a second takeover bid by logistics company Bibby Line Group.
For the past 15 months, Nisa-Today’s has been under-going a tender process with six potential suppliers, to choose one that could provide the best strategy to align its supply chain operations with the future requirements of members and the changing grocery marketplace.
The objective of the tender was to improve member service while reducing costs.
The decision to unite all elements of the group’s distribution logistics under one supplier is expected to greatly enhance service provision to Nisa-Today’s and its members.
Increased efficiency in the supply chain will also result in lower cost of goods.
As part of the agreement Nisa-Today’s and DHL will continue to utilise existing distribution infrastructure providing future stability to the workforce.
As part of the new composite distribution model developed for Nisa-Today’s, DHL will manage ambient, frozen and chilled products through all three warehouses to optimise flow of product across the supply chain network.
This will also support smaller and more frequent deliveries to be made to all stores, which will allow members greater flexibility in ordering and more effective control of stock levels in line with customer demand.
By consolidating deliveries and through better utilisation of the network DHL will not only reduce transport mileage but also provide a significant saving in operational costs for Nisa-Today’s.
“After a period of consideration, taking into account all elements of the tenders, we are delighted to award the future distribution contract for post 2011, to DHL Supply Chain,” said John Sharpe, managing director of central distribution trading and logistics at Nisa-Today’s.
“This is a positive step to secure and enhance Nisa-Today’s supply chain and its workforce, and demonstrates our commitment to independent retailers and wholesalers.”
Chris Sharp, managing director for food retail for DHL Supply Chain, said: “Our key objective has been to increase flexibility across the business while reducing cost.
“The solution we have developed to utilise existing infrastructure through an innovative composite distribution model will not only deliver a more agile supply chain but also reduce risk by providing greater business protection.
“We have worked with Nisa-Today’s for over 20 years and we are hugely excited about the opportunity to extend our partnership by implementing its entire future supply chain strategy.”
Source: Nisa-Today’s
