Papa John's Scores a Supply Chain Touchdown

A look at how the nationwide pizza chain gears up its supply chain system for Super Bowl Sunday


The numbers for 2010 point out the efficiencies enabled by the supply chain solutions. For example, Papa John’s enjoyed a 66.4 percent reduction in outside storage costs; a 15.7 percent reduction in inventory levels; an 83.7 percent reduction in inventory investments; and an internal rate of return of 72.3 percent, Kinder says. “All of these projects have exceeded our ROI projections,” she adds.

“On inbound, we used to be 100 percent prepaid,” she says. “We’ve converted around 60 percent of the vendors to collect. Our freight cost savings after the conversion were 9.7 percent, with an 83.4 percent ROI. The WMS has yielded a 9 percent increase in productivity.”

On the outbound side, there was an increase in tractor fill of roughly 16 percent.

Begin with the Vision

The company is not standing still, Kinder adds. “We are going to take our transportation management system to the next level by implementing fleet dispatch. We’re going to integrate with a company called Isotrak out of the U.K. [a partner of Manhattan Associates]. It gives real-time visibility of the drivers — miles per hour, driving styles and more. Then we’ll do supply chain intelligence. We’ll have scorecards from the driver level to the distribution level. When there’s a snowstorm [or any other event that requires an alteration in plans], instead of the driver having to call in, they’ll know about it at the center” via an onboard computer that tracks the drivers’ ETA. The route can be reevaluated and restaurants contacted as necessary.

Kinder also advises organizations looking for a way to streamline supply chain operations. It begins with vision.

“I think one of the most important things is that you have to align the organization vision with the systems vision,” she says. “If you have multiple business problems, you need to find a vendor with the capacity to solve them all. It is a much broader decision than buying software. It’s about forming a long-term partnership to meet your business objectives. Know your vision and then find a partner.”

She says cost savings also should be part of the strategy. “For example, we purchased more modules [from Manhattan] than we could implement right away, but the solutions aligned with our long-term vision, and by implementing the highest-ROI project first, we were able to fund future projects. Grab the lowest hanging fruit first.”

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