Diageo Needed a Way to Keep High Logistics Spends in Check

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ABOUT Diageo

Company Profile: One of the largest alcohol manufacturer in the world.

Supply Chain Type: Regular Outbound 3PLMarket Vehicles

Visibility Resolution: Shipment-level

Parameters Monitored: Location, ETA, Route

Diageo's Challenges

Market vehicles (3PLs) used to cut freight costs, but they couldn’t be tracked to improve predictability or reduce shipping delays.

GPS vehicle tracking systems weren’t a viable option for 3PL tracking.

Rising detention cost at depots due to late unloading or inaccurate billing by drivers/transporters.

Government mandate to track shipments in order to prove product safety and counter rising incidents of shipment thefts in the liquor industry.

The Roambee Solution

Roambee provided Diageo with the ability to monitor shipments across market vehicles and get alerts when a route deviation occurs.

Multiple approved routes could be created in the system with ease.

Detailed time-stamped location reports to identify the root cause of detention costs by depot.

The Impact

Reduction in detention costs through the identification of problem depots and billing discrepancies.

Safer cargo transit owing to the ability to react instantly in the event of a route deviation.

Ability to comply with Excise (government) policies while continuing to derive the cost benefits of using 3PL-run market vehicles.

Founded in 1826, United Spirits Limited (USL), now a Diageo group company, is the largest liquor manufacturing company in India.

It sells over 140 brands of alcoholic beverages across India, 14 of which sell more than a million cases each year, and 4 of which each sell over 10 million cases annually.

Diageo has 78+ manufacturing facilities across 23 states and 3 union territories in India, and it manages a distribution network that covers 81,000 major outlets across the country. DIAGEO doesn’t maintain its own transport fleet. Instead, it uses leased market vehicles — also known as 3PLs — for product distribution to its regional depots in order to keep logistics costs low.

Although 3PLs were more cost-efficient overall, DIAGEO became wary of prevailing inefficiencies in how day-to-day operations would play out.

Besides inconsistent transit times, DIAGEO was particularly concerned about inaccurate billing by their 3PLs (and independent transport contractors) as well as rising detention costs at their depots due to late unloading.

Diageo's Ask



3PL Tracking

Pattern Analytics

Identify Detention Bottlenecks

Detailed Route Reports

Chain of Custody Proof

Tamper & Pilferage Prevention

What Diageo Needed was Reliable Tracking & Analytics

Shipment Tracking to Improve Both Supply Chain Efficiency and Auditability


Diageo wanted to deploy a shipment tracking system the likes of which it never attempted before. The system had to work on market vehicles (vehicles that are seldom used more than once), be able to track patterns in shipment data to identify areas for improvement, as well as generate detailed reports that could help them plug inefficiencies and cargo theft.

Diageo tried to limit unpredictable shipment ETAs, seemingly inflated cargo loading/unloading times, and their associated overheads like higher shipping and detention cost by pushing their 3PLs to pull it together.

It wasn’t working.

Besides these concerns, DIAGEO also had another, more important reason to track their transporters.

Diageo Was Also Dealing with a Cargo Theft Problem


Cargo theft is a growing problem in some of the northern states of India; it’s not uncommon for complete truckloads to be stolen. Electronic goods, medical & pharmaceutical products, as well as premium alcohol — they’re all very lucrative shipments for enterprising cargo thieves.

With alcoholic beverages, there’s also the issue of pilferage and adulterated or spurious products mixing with the good stuff before shipments hit the markets.

Transporters plying the remote corridors of northern India often pull over for the night at remote areas or at offbeat roadside truck stops where the food’s probably safer than the parking. Liquor shipments could easily be tampered with at such secluded locations, diluted, or outright swapped out with counterfeit bottles.

In fact, to counter the possibility of genuine products being swapped out with counterfeit liquor, the government introduced new policies to improve the security and auditability of alcoholic beverage supply chains in India. All liquor manufacturers and distributors would have to establish a reliable system to track beverage shipments in order to:

  • Improve auditability in the movement of liquor in the country.
  • Deter and detect incidents of cargo theft, pilferage, adulteration, or the infusion of counterfeit products in shipments en route.
  • Guarantee complete transparency in the shipment chain of custody, from the distillery to last-mile delivery.

Diageo wanted to minimize the risk of theft or pilferage in its alcoholic beverage supply chain because it had serious repercussions for customer safety; the consumption of counterfeit alcoholic beverages can and often is, life-threatening.

Diageo wanted to make sure its liquor shipments were safer by making sure their 3PLs:

  • Use the safest routes
  • Didn’t deviate from their delivery route or make unscheduled stops

Diageo Explored GPS Vehicle Tracking, But it Did Not Work


Diageo knew the best way to manage both schedules and safety was to keep track of their shipments by tracking the market vehicles they’re on. They believed it waspossible through GPS vehicle trackers. Diageo hoped that tracking the vehicles transporting their shipments would allow them to:

  • Ensure SLAs are being followed — by making sure their 3PLs’ stick to the agreed-upon routes.
  • Identify bottlenecks — on different routes or at loading/unloading points, to help understand delays and manage schedules better.
  • Validate expenditures — like detention time.
  • Ensure shipment safety and integrity — through the enforcement of best-practices.

Easier said than done though.

The first big hurdle was tracking a fleet that wasn’t their own.

DIAGEO uses market vehicles (aka 3PLs) hired on-demand to transport its liquor shipments, giving them the flexibility to easily scale outbound volumes during periods of high demand.

Since DIAGEO weren’t using leased vehicles or dedicated 3PLs, they couldn’t install GPS trackers on them, neither could they rely on their 3PLs to install tracking systems of their own.

Prioritizing 3PLs that tracked their fleets using GPS wasn’t an option either.

Most 3PL fleets or market vehicles don’t have an active GPS tracking system installed, and those that do aren’t always available when needed. Even if DIAGEO managed to hire a GPS-enabled vehicle to transport its shipments, getting access to the tracking data wasn’t easy, assuming, of course, the 3PL agreed to share access in the first place.

It began to dawn on DIAGEO that the simple solution to their problems wasn’t the simplest of solutions to deploy.

The Roambee Solution

Reducing Logistics Costs, Inefficiency, & Cargo Security Risk without 3PL Involvement


Roambee told DIAGEO they shouldn’t track their shipments by tracking vehicles, it doesn’t work.

Instead, Roambee told DIAGEO to track their shipments by, you guessed it, tracking their shipments.

 

Roambee deployed wireless portable monitoring devices — the Bee — to give DIAGEO real-time visibility into the location and movement of their liquor shipments.

ROAMBEE'S ANSWER

Roambee's Solution
Real-time Shipment Location Visibility
Roambee's Solution
Route Compliance
Roambee's Solution
Route Deviation Alerts

DIAGEO used a Bee to track each outbound liquor shipment, giving them the ability to track their product through a dedicated web portal, regardless of the 3PL used.

The web portal could also be used to:

  • Create multiple approved routes with ease.
  • Create dashboards to monitor shipment status and manage logistics.
  • Generate and download detailed shipment location tracking reports.

Roambee’s live shipment tracking solution gave DIAGEO real-time alerts if there were any deviations from the norm such as route changes or unscheduled stops. These alerts gave DIAGEO enough of a heads-up to call drivers to avoid risks or resolve problems.

Diageo's GAINS



Carrier Flexibility

Improved Transit Visibility

Supply Chain Predictability

Shipment Security

Route Deviation Alerts

SLA Enforceability


But Wait … There’s More!


Besides shipment tracking and security, DIAGEO began to leverage Roambee’s real-time location monitoring to improve logistics efficiency as well as make billing and auditability more transparent.

Roambee helped DIAGEO analyze the tracking data it gathered, which allowed them to:

  • Identify faster routes and likely bottlenecks —allowing them to better gauge ETAs and ensure shipments are delivered on before time.
  • Identify depots where shipments idle longer — allowing them to plan faster dispatches and avoid delays.
  • Identify discrepancies in reports and bills — using verifiable tracking data and detailed reports to audit transport bills and detention costs.
  • Track inefficiencies and issues — by individual carrier, distribution route, or depot.
  • Track inventory in transit — enabling complete chain of custody proof and authentication.
  • Manage inventory in transit — which makes it easier to reroute shipments and cope with localized fluctuations in demand.
  • Manage 3PL business relationships better — through operational transparency and mutual performance benchmarking, which lead to fewer arguments that would otherwise arise due to discrepancies.

Diageo's newest advantages



Route Benchmarking

Carrier Benchmarking

Verifiable Spends

In-transit Inventory

Chain of Custody Proof

Easy Auditability

How Diageo Keeps the Drinks Coming


  • DIAGEO tracks about ~1500 full truckload shipments every month from their factories to regional depots across India. The company has maintained growth and is scaling its logistics operations efficiently and with complete transparency.
  • DIAGEO is also more confident of their shipment’s security, and it can now easily prove its products are the genuine article.
  • DIAGEO is now saving more by optimizing dispatch time and through better logistics efficiency.
  • DIAGEO is now spending less on detention costs through verifiable location and time logs.
  • DIAGEO is in control now with Roambee.

It’s Easy to Get Started with Roambee

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