Peapod Digital Labs (Ahold Delhaize USA) : A better home delivery strategy

The challenge: improving home delivery planning on a single platform

As online grocery shopping has increased dramatically the last few years, so have customer expectations and buying habits, with many expecting a quick, reliable delivery service. Peapod Digital Labs (PDL), one of the nation’s largest grocery retail groups and the e-commerce engine of Ahold Delhaize USA, recognized the need to address efficiency and customer loyalty/satisfaction. With more than 85,000 delivery stops a day, PDL wanted to optimize delivery results in a single platform and upgrade its routing system. The company sought a cutting-edge solution to deliver optimal results on one platform and improve customer satisfaction.

Created value: improved KPIs and double the anticipated savings

ORTEC’s Home Delivery solution provides dispatch & execution, daily optimization, appointment scheduling, yield management, cost to serve and planned vs. realized analytics. 

A cutting-edge solution to conquer an evolving delivery scenario

PDL, one of the nation's largest grocery retail groups and the e-commerce engine of Ahold Delhaize USA, recognized an upward digital shift in how Americans were shopping and the growing demand for next-day and same-day delivery. The company’s routing, yield management and time-slotting technology needed a facelift to keep up with the new changes in demand. With 950 trucks that drive approximately 415,000 miles weekly to 29 fulfillment centers, and 85,000 delivery stops a day, it adds up to a lot of routes and deliveries. PDL sought a cutting-edge, cloud-based solution to provide optimal results in one platform. For an online delivery service that operates Stop & Shop, Food Lion, Giant-Landover and other supermarkets, and delivers from that company's stores, it was a big yet necessary task.

The benefits

• Realized 200%+ of the anticipated savings

• Increased orders per hour and decreased miles driven per order, reducing carbon emissions

• Improved customer service due to faster delivery execution and on-time deliveries

• Boosted driver satisfaction with better routes

• Optimized routes across their grocery delivery operations

• Improved ability to monitor and act on disruptions while delivery trucks are on the road

Delivering great results

Seven months after PDL completed its first grocery home delivery routes with OHD, the company earned back 200% of the anticipated savings, a savings on average of $1 per order – double the amount originally expected to save per order. The effectiveness of OHD was measured by KPIs such as orders per hour and miles per order. Both showed significant improvements.

Another benefit was drivers went less miles for the same number of orders, which contributed to the environmental impact area. For the drivers and planners, more efficient routes meant they saved time and felt more comfortable with ‘routes that make sense.’ It added up to a successful new solution with happier customers and employees.