Yeo Hiap Seng Limited (a Singapore F&B company) has outsourced management of its warehousing and delivery of its products in Singapore to YCH Group (a supply chain solutions/logistics management company), allowing them to concentrate on their core business competencies such as product development, branding, marketing and sales.
The multi-million dollar partnership between YHS and YCH also establishes a new logistics model for the highly competitive F&B industry, achieved through a multi-channel pricing solution.
This model generates significant cost efficiency via accurate tracking of channel costs and a variable pricing formula, which adjusts itself according to the performance of the respective distribution channels. Currently, most players in the industry pay the same price for distributing products across all channels.
With the new mechanism, Yeo Hiap Seng is able to develop each of their trade channels, vary its prices based on the efficiencies of the channels and better allocate resources to bring benefits to customers.
Founded on YCH’s supply-chain solution – Intrabulation, the mechanism is also fully interfaced with all of Yeo Hiap Seng’s internal IT and business platforms, providing a seamless flow of information and measurement simultaneously to both companies.
This arrangement between the two Singapore companies reflects the growing trend among brand marketers like Yeo Hiap Seng, to outsource certain business functions, such as logistics, without losing their core business strengths.
Yeo Hiap Seng requires logistics support that is driven by high levels of customer service across diverse trade channels. It has to manage movement of millions of F&B items to over 8,000 points around the island effectively and efficiently. Some of the products that YCH will manage for Yeo Hiap Seng include Yeo’s range of beverage products, Pepsi, Evian, Volvic and Berri.
YCH is currently a supply chain solutions partner to other MNCs such as Compaq, Motorola, Solectron, Moet Henessy, Roche and Telecom Equipment.