Efficient transport drives retail success
With nearly half a million employees and stores in more than 10 countries, Tesco is a leading global retailer. The company traces its origins to a small grocery stall in 1920s London. They have come a long way since. Tesco sees yearly revenues of £51 billion. They serve millions of customers every week. In the UK, the retailer serves a customer every 66 seconds and boasts a market share of 30%. To remain ahead of the game in a highly competitive retail space, Tesco was looking to improve its transport plan.
A need for efficiency in logistics
In retail, transport and logistics provide a high point of tension. On the one hand, retailers must run a lean logistics operation at the lowest possible cost. On the other, they need to ensure punctuality and reliability and put the customer first at all times. Tesco was no stranger to this challenge. They lacked a scalable solution to plan transport efficiently and track whether they delivered according to plan. When we first made contact with Tesco, their vehicles travelled 288 million kilometers, emitting 216 tons of CO₂ – roughly 5% of Tesco’s total CO₂ footprint. They seized the opportunity to improve their logistics plan and reduce these carbon emissions.
Better Routing and Dispatch
ORTEC was selected among 13 vendors, based on our team’s experience, our ability to provide the functionalities needed and proven results in similar optimization projects. After a successful pilot with ORTEC Routing & Dispatch in Slovakia, the solution was rolled out in Tesco Poland, Czech Republic, Slovakia, Hungary, Thailand and Malaysia. Tesco’s team uses ORTEC’s solution to model and create the daily delivery routes from the warehouses to the stores. We implemented an integration with Tesco’s warehouse management system (running on Oracle) and a third-party track & trace system (Microlise) to facilitate data transfer and accuracy.
Since the initial implementation in 2010, TESCO cooperation with ORTEC has only increased year by year. ORTEC solution has become an essential part of TESCO logistics operations in Central Europe and South-East Asia.
Lower costs and lower emissions
With ORTEC Routing & Dispatch, Tesco can boost cost effectiveness in a highly competitive industry. They enjoyed a 10% reduction in cost per case. Tesco has also been able to strengthen collaboration between business units and within the supply chain. Quick simulation of planning scenarios and improved data visualization have allowed them to react with ease and agility to their industry’s changing conditions.
