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More efficient logistics boost profit for Sainsburys

By: Deborah Bates
17 November 2010

In their half-year financial statement, Sainsbury's has reported an increase in profit by 8.2%, thanks to making its logistics systems more efficient, says Logistics Managers.

Tactics such as optimising trailer space and identifying unnecessary journeys have increased Sainsbury's profit to £360million for the first half of the year. Those in driving work are being shown how to structure their days more efficiently to make the most of their driving time, and the company's annual 'Driver of the Year' competition has also proven to be a motivator in encouraging Sainsbury's drivers to improve efficiencies.

The company is also investing in innovative supply chain technology to improve their logistics services. This technology includes a new system that provides realtime ordered and forecasting, helping Sainsbury's to improve the effectiveness of its services, and also reduce waste - saving a predicted 1400 tonnes of carbon emissions each year. Additionally, chief executive of the company, Justin King, claims "...we have reduced packaging by 8 million kilos in the last year."

By identifying and actioning the required changes in their logistics techniques, Sainsbury's total sales stand at £11.9 billion; a growth of 7%. King is enthusiastic about the changes, and pleased with the development of Sainsbury's services. He said "We are pleased with the growth of our channels and services, as we continue to extend our offer to more customers...the bank has delivered strong profit growth."

Other areas of improvement at Sainsbury's include the introduction of self-scan checkouts, according to Share Cast, helping the company to balance any inflationary pressures during the year. King claims the company is "on track to hit its target space growth of 15% over the 2 years", and is confident the company is "in a position to do well."

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