Shared Services
The Logistics & IT Department – Shared Services – is responsible for the national and international supply chain processes. In 2012 it was honoured with the prestigious «Swiss Logistics Award» for its innovative transport logistics.
Shared Services combine the competence centres in the areas of logistics, IT, transport, sustainable development/ecology, planning/expansion and quality assurance. In addition to operations, the competence centres are responsible for the strategic orientation of these areas.
Activities in the logistics sector in 2012 focused on increasing efficiency by reducing costs along the whole supply chain. Rising raw material prices, a weak euro and higher production costs necessitated optimisation along the whole value-added chain.
Distribution centres: consolidation of facilities
Automation at the Migros Distribution Centre Suhr (food) and Migros Distribution Centre Neuendorf (non- and near-food products, textiles and frozen produce) has been stepped up. In the year under review, the state-of-the-art, fully automated picking facilities, which commenced operations in 2011, were consolidated. The investments in automation made in recent years have resulted in marked increases in productivity and cost savings. There has also been an expansion of capacities, in reaction to the rising demand for frozen products. The goal of bringing additional and more cost-effective goods to the market has been achieved.
East Asia: successful pilot project
In the procurement logistics sector, Shared Services successfully conducted a pilot project in East Asia in 2012: the transport of single containers by rail from China to Switzerland. Volatile prices for sea transport, piracy and the relocation of China’s established industrial sites into the interior of the country call for the trialling of alternative means of transport, especially of overland routes to Europe. In the medium term, Migros is anticipating a partial switching of transport that has previously been effected by ship onto the railway system. The overland route will lead above all to marked time savings of up to 50%.
IT: integration complete
Following the pooling of IT competence and services under a single management structure as Migros IT Services in 2011, the integration was consolidated in the year under review. IT continues to operate on a decentralised basis, but now has a compact management structure. This enables processes and developments to be standardised and quality to be optimised. Centralisation means that resources can be deployed more efficiently and costs reduced. The second stage of the consolidation provides for the pooling of the IT infrastructure and computer centres.
Sustainable development: optimised services
In 2012 the Logistics & IT Department, in partnership with the other Migros strategic business units, committed itself to the sustainable organisation of its services. Within Shared Services, certain aspects of sustainable development have been more strongly incorporated into the individual management divisions.
Within the Commerce SBU, a start was made on extending the environmental control system, together with the integration into the 2020 Climate and Energy Strategy to both Denner and Globus. Initial discussions have taken place on target setting.
As in the previous year, the bulk of Migros’ goods transport was carried by rail, and Migros is therefore still the largest customer of SBB Cargo for national goods traffic. The proportion of goods transported by rail as opposed to that carried by road between the national and regional distribution centres is 75%. In the year under review, Migros successfully switched deliveries to a number of regional Cooperatives to the railway network. This made it possible to reduce the number of kilometres travelled by road and, linked to this, to reduce CO2 emissions by 131 tonnes.
Progress has also been made in the corporate environmental protection area. In the year under review, Migros introduced the recycling of CDs and took the decision to become the first Swiss retailer to recover and recycle all types of household plastic bottles from the end of the year 2013. Migros has once again made huge efforts to remain a benchmark for recycling products.
Logistics «Oscar» winner
In 2012 Migros received the Swiss Logistics Award for its innovation project «Transport planning with ant-based logic», which enables trips for heavy goods vehicles to be planned dynamically, thereby reducing costs and saving energy. The prize is regarded as the logistics industry «Oscar». In the previous year Migros had already won the National Energy Globe Award for Switzerland and the Energy Globe Award in the Air category, the so-called sustainable development «Oscars».
Goals and outlook
Shared Services are anticipating a further increase in efficiency in the current year. Efforts will be made to transport similar or slightly higher volumes of goods at lower cost and at the same time with less damage to the environment, to optimise the supply chain processes in the intermediary trade area, and to further increase energy efficiency. Further progress and adjustments will be made to the pilot project «Rail Transport China – Switzerland» in procurement logistics.