Dive Brief:
- Newell Brands will favor full truckload shipments over LTL shipments as the company looks to integrate its 23 business units into a single supply chain, CFO Chris Peterson said during a Feb. 11 earnings call.
- The Sharpie, Rubbermaid and Elmer's glue maker is testing a move toward full load deliveries, which Peterson said have been easier to secure in a constrained trucking environment.
- The move comes as the company unifies its distribution networks and plans to integrate product shipments from different business units. The plan "will allow us to accept one order, send one invoice and receive one payment from customers, while shipping our products on one truck," Peterson said.
Dive Insight:
Combining product shipments from Newell's different business units will unify its "very fragmented" distribution networks, president and CEO Ravi Saligram said during the earnings call.
The company, which also produces Yankee Candle products and Oster kitchen appliances, is focusing instead on improving operations through its accelerated supply chain strategy, Project Ovid, announced last year.
"We acted like eight — not seven, but eight — sort of $1 billion-plus companies instead of being a $10 billion company," Saligram said.
Integrating supply chains will allow the company to consolidate shipments. Newell expects a 40% reduction in miles driven once it adopts the new operating model.
A move to full load shipments is also expected to save costs as trucking rates remain elevated. The company expects the savings from its integration plan to be higher than initially expected due to "a significant amount of savings in transportation," Peterson said.
The company's writing business, which includes Sharpie, avoided some supply chain snarls last year due to its U.S.-based manufacturing operations. The writing business almost doubled the growth rate of the overall company in 2021, Saligram said on the Q4 earnings call.
Newell is further bolstering its U.S. presence with a distribution center in Newville, Pennsylvania. The facility is on track this month to begin receiving product shipments, which are already on the water en route from China, Peterson said.
