OshKosh B'Gosh: An Overall Inbound Success
OshKosh B'Gosh tries on a 3PL partner to better manage its global inbound flow.
The Global Marketplace. It is a phrase that has become increasingly important in business and specifically in logistics. However, in 1895, in the small town of OshKosh, Wisc., the global marketplace was the farthest thing from one clothing manufacturer's mind.
More than 100 years ago, OshKosh B'Gosh started producing rugged bib overalls for men. It wasn't until the early 1900s that the company began making the pint-size version so children could dress like their fathers.
Now with operations including apparel manufacturing in the United States and overseas, licensing, wholesale distribution of children's wear through department and specialty stores as well as OshKosh's own retail stores, and international sales in more than 50 countries, OshKosh B'Gosh is most certainly a global retailer. With that growth comes supply chain needs the company could never have fathomed back in 1895.
As global operations began to strengthen in importance, OshKosh B'Gosh began manufacturing offshore, creating the need to clear customs and bring products in through the ports. This developed into a logistical challenge: getting product to the distribution centers more quickly.
In the past, OshKosh relied on its ocean carrier and third-party logistics provider to move product to the distribution centers. But this was clearly not the optimum method, says Dennis Defnet, corporate transportation manager for OshKosh B'Gosh.
"Back then, we experienced delays in moving containers from the port, getting them cleared through customs, then moving them to a site where they could be loaded into trailers and shipped to the distribution centers," he recalls.
Little Fish in a Big Pond
OshKosh was also working with a large 3PL partner at the time. "We had chosen this company because it was large and had many large clients," says Defnet. Because OshKosh's business was not as big, however, the 3PL did not provide the level of service OshKosh required.
There is one example that Defnet will never forget. It was the day after Thanksgiving and the 3PL was not working because of the holiday. OshKosh's freight sat at the port that Friday, Saturday and Sunday until someone was available to work on it Monday.
"It is very important in the latter half of the year and the peak season for retailers to keep freight moving as fast as possible to maintain a high percentage of on-time customer deliveries," says Defnet.
With these types of shipping and delivery delays, and freight and logistics costs becoming a concern, Defnet questioned OshKosh's logistics strategy: why was it paying for a service it was not receiving?
A need to automate communication, combined with a lack of urgency in getting to the port to work on the containers, prompted Defnet to make a significant change in the way OshKosh manages logistics.
In With The New
That change came in the form of a new partnership with the Supply Chain Solution division of Cookeville, Tenn.-based Averitt Express. OshKosh had used Averitt for LTL, TL, and expedited services in the past and was familiar with its level of service. When Defnet decided to change gears and begin working with Averitt, he met first with Chuck Odom, vice president of sales for Averitt Supply Chain Solutions.
According to Odom, he and Defnet immediately hit it off at their first meeting 16 months ago. "During that first conversation, Dennis Defnet laid it on the line: 'We need to change what we have been doing. We need to eliminate some partners that have not been working hard enough for us, and we need to increase velocity, improve transit times, and reduce costs,'" recalls Odom.
It didn't take long before Averitt was handling all inbound product for OshKosh from the ports of Charleston, S.C.; Gulfport, Miss; and Long Beach, Calif. But implementing the new system was not without its challenges. The 3PL encountered major hurdles at the ports. "The sheer volume coming in during fixed hours—Monday through Friday, 9 a.m. to 5 p.m.—was definitely a big challenge for us," Odom says.
Averitt took an unconventional approach to this issue by shifting the paradigm of working during fixed hours.
"First we went to each steamship line and asked the crew if they had hoot hours (night hours) and skeleton crews. We wanted to find out if we could come in on Saturday, Sunday and during the night to pull containers rather than wait until Monday and stand in line with the crowds at the port. We found out that although they did not publish this information, they did have skeleton crews and hoot hours and were willing to work with us," says Odom.
The "flex days" and "flex hours" Averitt offers OshKosh as part of its logistics solution are key to speeding the inbound flow. By allowing OshKosh to choose the days of the week it wants Averitt to be available, the company can reap the benefits of a time-efficient schedule tailored to the port arrival times of containers. For example, with OshKosh's Thursday-to-Sunday work week, Averitt is there to work on containers as soon as they come in.
"Containers typically come in on Thursday and it takes a day or two to offload them," notes Defnet. "They used to just sit there over the weekend until someone would be available to work on them Monday."
With Averitt's system, the containers are offloaded as soon as they arrive. Averitt works on them Friday, Friday night and even through the weekend if needed, which allows containers to be offloaded and shipped on Monday. This shaves about three to five days off the entire process, according to Defnet.
What's more, Averitt builds direct loads right to the distribution centers rather than transporting the containers with mixed loads to each center. Instead of moving 40-foot ocean containers by rail across the country, Averitt sorts and offloads the product in 53-foot trailers, consolidating space and cutting freight expenses.
"We load three containers into two trailers," says Odom. "Some providers might not pack the product like this because they could charge more for sending out the three containers without consolidating."
The process has yet another benefit. By emptying the containers at the port as soon as they come in, OshKosh can give those assets back to the ocean carrier immediately.
"This helps reduce rates in ocean contracts because the carrier no longer has the responsibility of getting the container back to port," notes Defnet.
Since Averitt came onboard, OshKosh has reduced its cycle time from 30 days to 24 days, from the time the container is loaded at the port overseas to the time it gets offloaded into a 53-foot trailer and shipped to the distribution centers, according to Odom.
A major part of that success is the communication between Averitt and OshKosh's ocean carrier, brokerage company, and motor freight carrier. All four partners communicate daily through a log that is sent to each member of the team. With this method, everyone knows exactly when the containers arrive at port, and if they are moved or cleared. Every step of the process is shared so that each partner can see and understand every link of the supply chain.
This group effort at the ports depends on all parties working together and that means collaborating with OshKosh's partners who are, in some cases, Averitt's competitors. "We work with a number of companies to facilitate this communication and sometimes we do work with our competitors in different areas," notes Odom.
This "one size does not fit all" approach has increased OshKosh's efficiency at the ports and throughout the supply chain. In choosing a partner that could handle its unique inbound needs, and meet demanding global delivery schedules, OshKosh finally found the perfect fit.