8 Advantages of Milk Run Style Deliveries
The shipping market today is replete with options. As a small business, you will encounter options like hub-and-spoke, direct shipment, and other logistics jargon which is why it’s fairly reasonable to feel compelled to explore your options.
Today, we’re diving in deep to discuss one of the standout methods, which is the Milk Run Delivery System. This article will teach you the various ways that you can use this to your advantage.
What is a milk run delivery?
First things first, let’s define the concept of milk run delivery. You might be wondering what milk has got to do with logistics. Known to be one of the most perishable goods, handling and shipping milk takes a lot of skill to accomplish.
It all started back in the old days of door-to-door milk bottle delivery. People developed a shipping technique that revolved around this product perfectly. Milk companies used their transport vehicles to their maximum potential to not waste gas and man labour. These companies utilized vehicles that are destined to pick up milk cans from farms to various local dairies for them to process and bottle.
Milk run delivery is a term used for shipping trips that pave the way for more deliveries of materials to assembly areas that require consistent replenishment. It is also a term used in the military for missions that are least likely to encounter friction from enemies.
Today, this method continues to be applied in various industries, including food and automobiles. In fact, airline companies also use this type of model. This particular company for instance, offers tri-weekly island hopper service from Honolulu to Guam through various stops.
This article will tackle the advantages of the old MR delivery and why it can actually improve your operations.
Advantages of milk run delivery
1. Short run times
MR deliveries require rigorous planning. From the delivery routes to the schedules, everything should flow smoothly. The courses taken are the quickest, and enough time is allotted for each supplier to make the exchange. The efficiency of milk run deliveries allows you to get a lot more accomplished in a day or a cycle.
2. Minimal cost for higher efficiency
Instead of having separate trips to purchase materials from different suppliers, MR deliveries only take a single trip to all those suppliers to save time and resources. Fitting numerous materials in one transport vehicle requires the vehicle to be utilized to its fullest extent.
3. Reduced cost per unit
By scheduling the supply of materials, manufacturers can also control their production. Producing just the right amount of finished products can minimize the risks of overproduction thus preventing a surplus and thereby reducing inventory and storage costs.
MR deliveries are an example of a KanBan system. In this setup, empty containers are brought by the consumers to the suppliers in exchange for the materials they need. Instead of supplying a predetermined number of materials, suppliers can know the exact amount their consumers need. Manufacturers who implement MR style deliveries also often do not have big capacity warehouses for inventory. This way, the chances of oversupply in MR deliveries is kept at a minimum.
4. Easily cope with demand fluctuation
As mentioned earlier, MR deliveries allow a way for suppliers to easily have an idea of the amount of products to be delivered. Besides, manually placing orders and negotiating prices can be an exhausting task, that is why with MR deliveries, a set price per piece is established between the supplier and the manufacturer for smoother transactions.
5. Less environmental impact
A big part of greenhouse gas emissions are from the transportation industry. MR deliveries are not only cost-efficient, but they’re also a more environmental-friendly logistics option. Fewer delivery trips means less carbon emissions and petroleum use.
6. Lower malfunction rate
Frequent procurement and delivery trips from suppliers can of course, prevent stock materials from piling up in your warehouse. This not only helps you better manage your inventory, it also ensures that the materials you receive are brand new, which are less likely to malfunction or to have imperfections.
In addition, a quality check is also easier done since a big batch can be difficult to validate but through MR deliveries, it is split into smaller clusters.
7. Easier task delegation
Using third-party logistics significantly reduces in-process inventory, increases capital flows, and reduces investment risks. A fully loaded trip leaves parent companies with fewer tasks on their plate.
8. Reduced vehicle flow
Having a regular delivery schedule allows you to plan and condense the use of vehicles and the workforce needed to discharge materials.
For example, you can schedule the procurement of all the heavy materials you need during a particular day of the week. Knowing this, you can plan and prepare everything ahead of time. So, instead of having your discharge team and equipment on stand-by every day, they can focus their energy on other productive business activities.
Is this the right one for you?
Picking the right delivery system for your company is no easy business so to help steer you to the right path and make an informed decision, here are the questions you need to consider.
- Will it help you drive conversions?
- Will it allow you to improve the average order value?
- Will it help you reduce your overhead costs and become more efficient?
- How will it help you grow your audience and market presence?
Setting it up
Once you’re all set with milk run style deliveries, the next step is to cover your bases. And these steps will help you successfully apply this type of delivery service into your business operations.
This system consists of a four-point process, although it may vary depending on the industry you’re in.
- A central point
- Supplier loading station
- Unloading in the supplier stations, if applicable.
- Going back to the central point as the final unloading point.
As efficient as this delivery system may seem, it still has its own drawbacks.
First, milk run systems need an optimized material handling and transportation processes to function well. You want to polish your route, timing, and communication with your business partners. This means that it takes work and a whole lot of planning to apply this system to your operations. Some companies go the extra mile and even make some adjustments in the floor plan of their factory just to make the whole setup work.
Generally, it’s best to consider the milk run delivery system if you’re in it for the long haul but expect to go through some trial and error as it can take a significant time to streamline this game-changing practice.
On the other hand, companies work around this risk by working with transport experts. Facilitating the system becomes more manageable by getting the help of seasoned transport solution providers like Farlow Transport.
Farlow Transport is a family-owned and operated transport company in Brisbane with years of experience in driving, trade regulations, and standards, among others, in their toolbelt. And for 25 years, Farlow Transport has been providing businesses with flexible and cost-effective solutions for their clients. So, if you’re ready to streamline your operations with a milk run style delivery, call us and have Farlow Transport handle your deliveries for you.