Four Steps to Executing a Seamless Transition of Service at Your Distribution Center

An underperforming warehouse services provider can cost your business a small fortune in lost revenue. Yet so many businesses stay with mediocre providers for years, simply to avoid the dreaded transition of service operation. On the surface, these fears are understandable. Transitioning from one provider to another involves a lot of moving parts, requiring a rock-solid transition plan and heaps of experience to pull it off successfully.

With the right provider, however, there is absolutely no reason you can’t have a painless and seamless transition. And with the amount of potential revenue at stake over the long term, you can’t afford to not make the switch once it becomes obvious that your current provider is a bad fit.

Merit Logistics has perfected the transition of service operation, having successfully executed transitions at over 200 locations nationwide. There are a handful of factors that will determine your success in transitioning to a new provider. Here are the most important.

1. Make Sure You’re Transitioning to the Right Service Provider

Choosing the right company as your new provider starts with getting a clear sense of why your current provider is producing subpar results.

Too often, businesses fail to identify the specific points of failure or underlying problems that are causing their current service providers to fall short. Simply saying “they’re not getting it done” isn’t good enough. Without a more detailed understanding of the problem, you risk contracting with a new provider that is similarly ill-equipped to meet your needs.

There are many reasons why your current provider may be underperforming, but here are a few of the most common:

• Bad hiring and/or training practices
• Lack of employee incentives to encourage productivity
• Use of a “temp” workforce
• Lack of onsite supervision
• Inability to adjust quickly to changing demands
• Making decisions that benefit the provider’s parent company to the detriment of your business

The bottom line is that a successful transition starts with identifying the underlying problems with your current provider and ensuring your new provider is planning to rectify them.

2. Personnel Support

Transitioning to a new provider involves a lot of moving parts. Pulling it off safely and successfully requires a large team of experienced managers, supervisors, trainers, and other team members who are experts in various aspects of changeover management.

Make sure your new provider is not trying to cut costs by going light on management and supervisory personnel during the transition period. Too much is at stake during a changeover to leave anything to chance. Saving money by trying to “go lean” on the implementation team should be considered a red flag. Companies that do this are likely to cut corners in the future as well.

Here is a list of the minimum team that Merit Logistics’ uses to support any transition of service:

• Dedicated Project Manager
• Dedicated Senior Supervisor
• Director of Operations
• Director of Travel
• Director of Operational Excellence
• Director of Risk and Safety
• Site Manager
• Full recruiting team (multiple onsite and remote recruiters)
• Full Training Team

3. Established Training Program

Executing a transition of service means a lot of new faces at your facility. How does your new provider plan to bring these people up to speed quickly, to be effective from day one, while maintaining the highest level of safety for everyone involved?

One thing that Merit Logistics has learned over the years is how important it is to have a highly formalized training program — one that has been optimized over many iterations to the point where the incoming provider can get everyone (including new hires) up to speed as efficiently as possible, thereby minimizing or eliminating short-term production lags and preventing injuries and accidents.

One of the keys to executing a changeover safely and successfully is understanding how to “Move quickly, but don’t rush.” It’s a delicate line, and it takes a great deal of experience to manage it effectively.

4. Experience

Supply chain logistics is a fluid business. In order to succeed, you must be able to adapt at a moment’s notice. When challenges arise — and they always do — there is precious little time to figure out how to react. Wasted time means lost revenue.

This issue is amplified when it comes to a transition of service, due to the abundance of opportunities for things to go wrong.

In the end, there is no substitute for experience. An experienced provider can quickly react to challenges as they arise (or head them off by anticipating problems), saving your organization from potential production interruptions and lost revenue. Ask about your incoming provider’s history with transitions of service to ensure they have the know-how to get it done effectively.

Learn more about Merit Logistics

Interested in learning more about how Merit can raise productivity and boost profit margins at your warehouse or distribution center – and also deliver a seamless transition of service? Drop us a line today on our Contact page or call us at 888-311-3909.