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Situation:

  • Client is one of the fastest growing MNC chocolate manufacturer. Though one of the late entrants, it has been able to have significant in-roads owing to its product quality and innovation. The company was launching a new product and wanted to have a cold-chain partner that can help in rapid market access while ensuring zero-defect in temperature management
  • India is one of the fastest growing chocolate markets in the world. Valued at Rs 7000Cr it is growing at nearly 20%. Rising affluence, growing youth population and a gradual shift from traditional sweets to Chocolates is fueling the growth.
  • Chocolates need to be stored and transported in 15-20 degree temperature range right through the supply chain to ensure the shape and quality of product is maintained. Client was facing following business challenges as hindrances to growth. 
    • Demand volatility – Chocolate demand is highly volatile depending upon season and occasions. In gifting season, winter demand shoots up. Client was finding the supply chain not responsive enough to adapt to the demand changes. Transit times are a big challenge with products taking 8-10 days to reach key markets from the factory. 
    • Product quality – Ensuring temperature integrity was one of the biggest challenges in ensure the product in right taste and form reaches the consumer. In long-distance reefer transportation, there are wide-spread incidences of drivers switching off the reefer units to save on diesel cost. From the distributor to the retail shelf temperature management was a bigger challenge
    • Untapped market for fine-chocolates – Client has been very hesitant to bring the high quality fine-chocolates from the global product basket and they require even more stringent management of cold chain network. There is a unfulfilled market remaining unaddressed primarily owing to supply chain constraints.
    • Cold chain storage costs – As client started penetrating into tier-II and tier-III markets cold store costs started eating into the profit margin. High lead time coupled with variability in demand means client had to take large cold store spaces in multiple locations which was adding to cost. 

Rivigo’s solution

Rivigo started 1.5 years back is causing disruption in cold chain management. It serves more than 40 clients spread across Pharma, Chocolates, Frozen foods, Ice-Creams, Dairy and Fresh Fruits. Rivigo’s innovative approach to cold-chain management offers 2 distinct advantages - 

  • A physically responsive supply chain to cater to Seasonality and demand volatility –Rivigo offers unique competitive advantage. Rivigo operates trucks reefer and ambient with a unique “Driver Relay concept” that ensures ~1000km of run/ day (3x that of typical operators). In traditional model transit time from Mumbai to Guwahati takes 10-12 days. With Rivigo's unique driver relay model this transit time has been brought down to 4 days. This enables manufacturers to respond quickly to sudden changes in demand pattern.
  • Temperature integrity across the product supply chain – Rivigo has deployed a comprehensive “closed loop temperature integrity model” to address cold chain break-down risks. It consists of 3 building blocks 
    • Technology for real-time monitoring of temperature – Rivigo has deployed state-of-the-art remote temperature monitoring systems and along with that has developed proprietary algorithms to generate product wise alerts for temperature going out of range.  
    • 24x7 Control tower to monitor alerts on temperature violation – It is not enough to have remote monitoring. Rivigo’s control tower ensures timely action is taken in case of any temperature violation, vehicle break-down and issues with reefer unit. 
    • On-ground service eco-system – This is the most critical component of the model. Rivigo has “pit-stops” every 200-250km spread across the country. A service eco-system comprising of vehicle maintenance team, reefer maintenance team and standby cold storage has been identified near each of these “pit-stop”. Any vehicle requiring physical help can be reached within 2-3 hours and addressed to.  
    • Remote temperature management – the latest advancement is allowing 2-way communication between the AC control unit and central monitoring desk. It is possible to control the temperature of all vehicles and storages from a central desk rather than being left at the hand of drivers and store attendants. Years of abuse in the temperature management has created a deep dis-trust between the Dairy manufacturers and the logistics service providers. This remote management technology gives the power in the hand of the Dairy manufacturer to ensure 100% adherence to temperature norms.
  • Direct to retail cold-chain management – Currently manufacturers have no visibility of temperature management between distributors and retail where the probability of temperature abuse is the highest. Rivigo delivers unique customized solution to store and distribute to retail stores on behalf of customer. This ensures dual advantage a) Distributors save on storage and energy cost; b) Manufacturers get assurance of temperature management. 

Impact

  • Client had a very successful new product launch on the back of our support. We cut-down delivery time by 3-4 days across locations and our robust temperature integrity system ensured high product acceptance. 
  • Client was positively surprised with our delivery lead times. They’re quite confident of bringing global product range without worrying about supply chain capability.
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