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Efficiency And Social Responsibility Go Together For Shipper Of Choice Kraft Heinz

FreightWaves

The Kraft Heinz Company (NYSE: KHC) is a Shipper of Choice not only because the company strives to create an efficient supply chain through investments in technology, but also because the food producer is dedicated to ensuring its supply chain promotes sustainability and social responsibility.

"We place a high value on an ethical and transparent supply chain. Accordingly, we demand that all business partners demonstrate a clear commitment to protecting the rights of workers worldwide," Kraft Heinz's employee code of conduct states. "We do not tolerate the use of forced labor including human trafficking and slavery."

Kraft Heinz earned eighth place in a survey conducted by FreightWaves and its partner Convoy of the top 25 manufacturers, distributors and retailers that do the best job in removing supply chain inefficiencies. These companies, voted by carrier members of the Truckload Carriers Association and members of the Blockchain in Transport Alliance, take additional steps to ensure good relationships with their partners through efforts such as providing accessible facilities and fighting driver detention.

"It takes an understanding in knowing what to go after to create supply chain efficiencies. Supply chains are complex but Kraft Heinz had a strategy to eliminate waste and identify areas where process can improve," said Mary Long, director of the Supply Chain Forum with the Haslam School of Business at the University of Tennessee – Knoxville. Long was previously vice president of logistics and network planning at Domino's, and she has also had extensive supply chain experience through her work at Campbell's Soup, General Mills, Pillsbury and Quaker Oats/Gatorade.

Kraft Heinz's supply chain spans the sourcing, warehousing and transporting of raw materials and ingredients to the packaging for the manufacture of the company's food and beverage products around the world. Supply chain partners must commit to protecting the rights of workers, while suppliers must adhere to Kraft Heinz's supplier guiding principles.

But besides practicing good ethics, Kraft Heinz is regarded by industry observers as making astute investments in technology as a way to improve supply chain efficiencies. The company has undertaken efforts such as working with price elasticity for its products, coordinating efforts between finance, sales and marketing to determine how to create favorable gross margins from sales promotions, and seeking to lower costs through procurement, according to an analysis in Forbes. Kraft Heinz has also streamlined its production process by looking at physical plant synergies and using computer modeling to find ways to eliminate waste throughout the supply chain, according to an analysis from the Association of Supply Chain Management.

"Kraft Heinz has made investments in process improvements and network design, which is all about efficient flow and designing around the customer," Long said.

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