Unlocking supply chain value

DSV Raceway’s multi-client vision is to foster a knowledgeable culture of cost consciousness across its supply chain, wherein key stakeholders understand cost drivers and collaborate to unlock cost synergy within a sustainable variable cost business model.

DSV is a leading global transport and logistics business that has enjoyed major growth since its establishment in 1976 to the current position as fourth largest global logistics business. DSV Solutions is the warehousing division and is well represented in South Africa.

The challenge

In 2014, the company made the decision to move from dedicated warehousing to shared multi-client facilities to unlock supply chain cost synergy for the mutual benefit of DSV and its supply chain partners. Raceway was founded in Johannesburg in 2015 with 40,000 square metres and three initial clients.

The solution

Through an ongoing process of change management, DSV partnered with its internal and external stakeholders to educate and upskill them on the benefits of collaborating to identify and manage cost out of its shared supply chain, and then reinvest the savings for mutual benefit. This has resulted in a culture of cost consciousness and ownership, underpinned by stringent measurement of costs and the ongoing development and sharing of dynamic resources.

The outcome

In 2018 and 2019, the company will have saved R6.8 million, and reinvested by:

  • Funding lower increases for clients whilst defending a fair margin;
  • Funding supply chain design and inventory optimisation projects for clients;
  • Funding the upskilling and cross-training of its staff and;
  • Acquiring technology that reduces cost, increases operating efficiency and reinforces environmental responsibility (such as solar and LED).

Due to this culture wherein cost synergies are maximised and reinvested, DSV has achieved an extremely high retention of clients, staff and suppliers. And the journey continues.