Michaels Stores turns to XPO for major Christmas Tree distribution strategy

While many stories focused on the holiday season with a logistics slant tend to focus on things like delivery methods and the e-commerce supply chain, a recent collaboration between third-party logistics and freight transportation services provider XPO Logistics and arts and crafts retail chain Michaels Stores has a bit of a different approach.

This approach centers on a distribution strategy for 500,000 artificial Christmas trees, which are a top seller in the more than 1,200 Michaels stores in North America, a task which Michaels said today it turned to XPO for assistance.

The collaboration was a successful logistics endeavor, with XPO working with Michaels to come up with a strategy, which, the companies said, staged and delivered what it called multiple waves of Christmas trees across Michael’s footprint of stores in less than 25 days, which enabled Michaels to add key capacity to its distribution network during a period of heightened holiday demand.

Rich Markovich, VP of global transportation for Michaels Stores, told LM that heading into its collaboration with XPO, there were three main challenges.

“First was capacity,” he said. “This is one of our largest single product orders annually.  We needed capacity and expertise that could manage and move the trees to the stores outside of our in-house distribution network.  XPO provided that.  We also needed a partner who could orchestrate several thousand deliveries over a short time window, into our stores at specific, scheduled times, so local managers could staff accordingly.  Lastly, we needed visibility throughout the process, end-to-end, to understand the flow of the product.  XPO provide a solution, which addressed all these key challenges and met our deadlines.”

This was different from its approach to Christmas tree distribution in previous years, when it used a variety of resources, which included a combination of Michaels’ dedicated transportation fleet, contract truckload carriers and LTL services.

In order for XPO to put its distribution plan into action, it put together what it called a “SWAT” team of experts from its brokerage, less-than-truckload (LTL), logistics, and technology operations.

This began with a collaborative planning process, with the XPO SWAT team and transportation and distribution personnel from Michaels, according to Ken Zoller, SVP of strategic accounts for XPO.

“We settled on XPO’s control tower solution as the best approach,” Zoller explained. “It allows us to centralize data on our technology platform and give Michaels end-to-end visibility of the shipments.”

The first step required positioning XPO teams at Michaels’ four third-party warehouses to handle the pre-sorting and staging of palletized loads for the stores, at which point XPO then consolidated and dispatched them as full truckloads through its brokerage network, to about 100 XPO LTL service centers.

And at the LTL centers, XPO workers unloaded and separated the shipments for transport to individual Michaels stores. XPO cross-docked them into its LTL network for next-day delivery and alerted each store manager in advance so they could have staff on hand to take receipt.

“In total, XPO handled the logistics for half a million trees, orchestrated over 600 full truckload moves, and made more than 3,200 LTL deliveries to 1,200 Michaels stores in North America – all in less than 25 days,” he said. “Each of Michaels’ 1,200 store locations received multiple individual deliveries from XPO LTL service centers.”