Improving the vehicle fill rate for Procter & Gamble, by Tugce Tali (with Procter & Gamble)
June 7, 2013
This thesis aimed to improve the Vehicle Fill Rate (VFR) of P&G outbound deliveries in order to achieve a win/win/win solution for the manufacturer/retailer/consumer. For this purpose, processes of P&G outbound deliveries were analyzed and the impacts of increased VFR on service level and logistics costs were assessed. It was found that increasing VFR without any other changes in the supplier-retailer chain has negative impacts in most cases, specifically on the inventory level. Afterwards, it was shown that reducing Minimum Order Quantities (MOQs) while increasing the VFR changes the direction of the impact to positive. This provides an opportunity to increase the VFR while keeping the balance with service level and logistics costs; and even improving them in most cases.