How a fertilizer giant doubled outbound shipping volume to win a share of a multimillion-dollar global market
This story is for executives who:
- Want to know how to increase production and avoid CAPEX.
- Need to be confident that they are in full control of transporting their product to market.
- Want to ascertain whether their rail logistics approach is optimized to top quartile for performance.
The Challenge
One of the world’s largest fertilizer companies was planning a major expansion into the global market. This required them to prove their capacity to significantly increase the quantities shipped from their Allan mine in Saskatchewan. Senior management knew that to achieve this, they would need to be fully in control of transporting their product to market.
However, like all too many rail users, the company was not communicating effectively with its rail providers. Senior executives were determined to turn the situation around. They called in their trusted operations improvement partner, Maine Pointe, to analyze the company's rail logistics.
Were they optimized and top quartile for performance? What sustainable measures could they put in place that would ultimately improve efficiency and effectiveness?
Getting back on track
Our team quickly ascertained that, in their current state, rail logistics would not be able to meet the required increase in shipping quantities. Leveraging our deep experience of working alongside North America’s Class 1-rail carriers, we put together an action plan that would:
- Guarantee the capability to ship significantly higher quantities on a reliable and sustainable basis
- Avoid the delays and log jams which challenge the North American rail network by implementing 170 railcar unit trains
- Shift away from manifest shipping meaning that shipment can be pre-arranged, prioritized and sent directly to a single destination
- Introduce a re-designed, optimized rail service across the network
- Gain carrier buy-in for the new network
The Results
As a direct result of Maine Pointe's work, our client and its railroad partner were able to appreciate exactly what they each stood to gain by developing a more collaborative and flexible approach. Our client was able to:
- Regain control of its rail logistics
- Prove its capacity to double outbound shipping volume without CAPEX on infrastructure
- Earn the official endorsement it required to capture a share of a global market worth hundreds of millions of dollars
Lessons learned for other executives
- It is possible to regain management control of taking your product to market via rail
- You can significantly increase your rail logistics capabilities with little or no CAPEX
- You can work with the railroads to overcome system capacity issues
- There is scope for significant improvements to your rail logistics reliability, scheduling and cost