Table of Contents
The Insight Session devoted to supply chain optimization at the National Association of Chain Drug Stores’ recent Total Store Expo in Boston epitomizes what the event is all about.
The Insight Session devoted to supply chain optimization at the National Association of Chain Drug Stores’ recent Total Store Expo in Boston epitomizes what the event is all about.
Wilson Lester, Ron Link and Reuben Slone, the senior vice president of supply chain management and logistics at Rite Aid, CVS Caremark and Walgreens, respectively, unveiled an initiative designed to make the chain drug store distribution system more environmentally sustainable and efficient.
The as-yet-unnamed program had its origin when Slone, who joined Walgreens in 2012 after eight years at OfficeMax, learned of the “de-trashing” process that was part of the daily routine at the drug chain’s warehouses. Upon receiving shipments from suppliers of consumer packaged goods, distribution center workers would remove and discard inner pack materials from cases before organizing items to be shipped to stores. He saw the process as wasteful and reached out to his counterparts at CVS Caremark and Rite Aid. Link and Lester concurred, and the three set about developing a chain drug industrywide approach to dealing with the problem.
According to research that was conducted by the Global Footprint Network and WBCSD Vision 2050 that was cited during the Insight Session, the current rate of resource usage will lead to the consumption of the equivalent of 2.3 Earths by the middle of this century, clearly an unsustainable trajectory. The supply chain optimization plan proposed at TSE envisions the top three drug chains and other members of the trade class working with supplier partners to eliminate 100% of inner pack materials and replace them with alternatives that are environmentally friendly, an evolution that Lester, Link and Slone were quick to point out is already under way at many retailers and manufacturers.
Cutting down on inner packs, optimizing case sizes and, ultimately, creating a closed loop delivery system, like the one used in the auto industry, will enable chain drug store operators and suppliers to reduce costs, enhance efficiency and better serve the consumer.
The work done by CVS Caremark, Rite Aid and Walgreens, and the call to other members of the trade class and CPG manufacturers to help address this urgent problem highlights what cooperation among business partners and, where appropriate, even competitors, can do.
