The client, one of the most successful international tobacco companies, owns six of the top 15 international cigarette brands in the world. The products are sold in over 180 markets worldwide and hold the biggest market share.
The challenges
The company needed a reliable logistics provider to act as its extended arm In order to streamline business functions, the client looked at defining their markets into clusters. The company specifically needed a reliable logistics provider to act as its extended arm within its North Latin America Cluster. This was a challenge because this was the largest of the client’ clusters, and hence needed the logistics partner to have:
- Global presence and geographic scope
- Extensive knowledge of the clients' operational needs
- Experience handling FMCG operations
- State-of-the-art solutions that could scale to suit large needs
This company also needed to work with local (Customs) providers, so their logistics partner would have to be responsible for clearing the goods and performing 4PL/Logistics tasks, but with fragmented sources in a 'manual' environment.
The Maersk solution
After careful consideration and multiple talks with Maersk, the client decided that Maersk would handle its logistics for the North Latin American Cluster (also called the North LatAm Cluster). The cluster consists of Canada, Mexico, Costa Rica, and the Dominican Republic, and decisions are made from its base in Guadalajara (Mexico).
Maersk was awarded a 3 years’ service contract as a sign of trust in their processes As part of its services, Maersk offered to set up processes for purchase orders management, forecast/allocation, bookings with carriers, E2E follow up and visibility, as well as freight audits for the client company’s production sites in Canada and Mexico. As a part of these operations, Maersk had to take into consideration that the client’s business deals with volumes of 5900 containers/year in import and exports within the North LatAm Cluster.
While this client usually gives service contracts that last about a year, Maersk was awarded a 3 years’ service contract as a sign of trust in their processes.
The outcome
- Implementing logistical solutions and plans during a pandemic for one of the largest companies in the world is a task, but one that Maersk was equipped to deal with.
- Maersk had less than 2 months to deploy an important structure – (and activate a contingency plan in case shipments got delayed as a result of the pandemic).
- Maersk even received an award in early June 2019 for the excellent work for this client.
- Maersk aims to work closely with the client to try and understand their needs and expand the service portfolio accordingly.
- Because Maersk followed this approach and was able to include Maersk Customs Services as part of the solution, just after 2 months of implementing it for the client.
Maersk value-added services
Some of the business’ needs that Maersk fulfilled for the client included:
- Implementing the split per category: The client needed one person who would oversee whole product categories. (For example, one single point of contact for LEAF TOBACCO for all the North Cluster, positively impacting stakeholder management & product specialisation, regulations, etc.)
- Implementing the best practices: With the support of the Customer integrated team, Maersk implemented best practices such as integrated dashboards that are now used across all of Latin America, not just the North Cluster.
- Standardising the Invoice approval data: Maersk performed freight audits and reporting for the whole North Cluster.
- Supporting changes in operations: Maersk offered operational support in full capacity when the client chose to undergo a warehouse supplier change in Costa Rica.
“For us it has been an enormous learning process and a very pleasant journey with Maersk. Hopefully, we will continue along this path of collaboration,” said Supply Chain Director in Latin America.
