What if you faced a product launch larger than anything your company had previously undertaken? We faced exactly that with the planned launch of our weight-loss product, alli™ (orlistat). It would be a nationwide effort requiring the distribution of nearly 300,000 cases of product during a four-day shipping window, plus 64,500 assembled promotional display cases.
We knew we would need time to prepare a really good plan—and we’d want to have a very reliable logistics partner in place.
GlaxoSmithKline Consumer Healthcare had both for this record-breaking launch. A year-long, cross-functional planning process was designed to bring alli to market from four regional distribution centers. Also, GSK has an effective and scalable product launch process that can be leveraged, even for a launch on the scale of alli.
To put this project in perspective, just consider that if all the trucks loaded with alli were parked bumper-to-bumper, the line would have stretched four miles.
Alli was to be introduced to the US market as the only weight-loss product approved by FDA for purchase without a prescription. More than two-thirds of the US population is overweight or obese, and alli’s launch was certain to generate significant consumer interest. It would be available simultaneously on the shelves of pharmacies, grocery stores and mass merchandisers across the country.
Logistics, packaging, display
So with that we started planning this massive product launch more than one year before its implementation. Though alli is an over-the-counter product, it is still subject to stringent FDA standards. There were many factors that would result in a successful outcome, and among the most critical was logistics. Early in the process we worked with our logistics provider, Kenco Logistic Services. Kenco was already in position as the provider of services at our four regional distribution centers (RDCs), as well as two other facilities that handle assembly, packaging and display for special product promotions.
Of all our many product launches, the scope of the alli project required special attention. Included in our planning were several critical components:
- JIT Strategy. To ensure flawless execution of the promotional display production we developed a Just-in-Time strategy from vendor to deployment. The process had to accommodate space constraints at the floorstand assembly facility, which would build a record number of alli displays.
- Order Management. We established a cut-off date with customers to place firm orders, which provided the accurate quantities we needed to plan for DC and trucking capacity.
- Carrier Selection. We determined that no single carrier could provide all the services required, so we utilized two motor carriers. One handled 300 LTL shipments and the other handled 350 TL shipments. This permitted us to control every step of the planning and execution of the transportation.
- Cargo Security. The size of the order and the number of trucks required made it necessary to engage a security firm to escort trucks from our facilities.
- Distribution Center/Assembly. Despite the critical importance of fulfilling all orders accurately, it was no less important that we accomplish this goal within budget. We worked closely with Kenco to help us plan and manage our RDC activity and to produce and fulfill the promotional displays within our required financial parameters.
Production of the 64,500 display cases was initiated about one month before the launch. Everything had to come together for a four-day shipping window, and no deliveries could occur prior to midnight of the fourth day. Kenco communicated with its associates well ahead of time to set internal expectations for the project including anticipated volumes, overtime requirements and key performance indicators.
We knew the schedule would be tight, and Kenco stood by its commitments, shipping 285,000 cases from our four RDCs, 100 percent on-time, without shortages or overages and only one damaged box at delivery.
Shared management responsibilities
Teamwork was at the core of the launch. Each RDC has a GSK manager who works in tandem with an onsite Kenco general manager. All orders are received by and managed through GSK-owned systems. Kenco is responsible for all operations inside the facilities, while GSK maintains responsibility for contracting and auditing all inbound and outbound transportation. The terms of this relationship are spelled out in contracts that include key performance indicators.
At specific sites the activity was intense. Our GSK/Kenco team at Fountain Inn, SC, shipped 2,299 pallets (58,726 cases) in two days, while the team at the Fresno, Calif. RDC shipped 62 truck loads, working 499 man hours in just two days. At Memphis, Kenco utilized 38 associates who put in more than 1,600 hours. Literally the day after the launch, the distribution process reverted to normal order fulfillment.
The success of our record-breaking alli launch showcased the benefits of developing strong relationships with a select group of dedicated supply chain service providers. PC
ABOUT THE AUTHOR
Anthony D. Williams is Director, Supply Chain Logistics, for GlaxoSmithKline Consumer Healthcare (SA).