Golden Pallet Award: The Biggest is the Best

Safeway's NorCal distribution center—the size of 33 football fields—boasts a 99.9 percent accuracy rate. Here’s how they do it.


“We’re constantly updating our fleet with more fuel efficient and environmentally-friendly equipment,” says Mixey. “We cover a large geographic area with our average distance per load at 205 miles and we have some stores that are 600 miles from the DC. But the bulk of our store concentration is in Oakland and San Francisco, so we have a lot of city deliveries.”

Urban delivery presents some challenges for the company. “We have more stores with restricted delivery than any other Safeway DC because we service the Bay area and they prefer not having trucks running around in the middle of the night,” says Mixey.

“We can’t deliver between 7 p.m. to 6 a.m. to about 100 of our stores. Plus, it’s not easy navigating a 50-foot trailer down the streets of San Francisco—and still have 99 percent on time delivery, but we manage it.”

NorCal owns its own fleet, which runs 24 hours a day seven days a week, and has 412 drivers. Its fleet consists of 210 tractors, 784 trailers and 16 yard tractors.

The company is using Eden Prairie, MN-based XATA’s onboard system on all of its trucks. “We’re using cellular and GPS,” says Mixey. “It allows us two-way communication and a host of reporting and monitoring capabilities.”

NorCal also serves as Safeway’s beta site, where it tests various initiatives before rolling them out to other DCs. “A lot of companies would use their smallest facility to do beta testing on certain things, but we’re usually the test site because we’re the largest and close to our headquarters in Pleasanton,” says Mixey.

Right now, the company is currently testing proximity reporting with the XATA system. “This allows us to send a message to the store and let them know that the truck will be there in 30 minutes,” says Mixey. “This is more efficient for the driver in unloading and for the stores as well, so their backroom is prepared and ready for the loads. Eventually, it will enable the stores to schedule their employees properly.”

The company is also testing air skirts on five of its trailers. “We’re looking at them not only in terms of how they affect our miles per gallon, but just how applicable they are to us without segregating our fleet,” says Mixey. “We would want to use them both in town and out-of-town, but some of the streets out here have very steep inclines and we want to make sure we won’t have any problems with that.”

In addition, NorCal is investing engine alternatives for its reefer unit engines. “Last year, we had to replace 180 reefer unit engines because they didn’t meet CARB (California Air Resource Board) requirements and this year we had to replace another 90 engines and it’s constantly getting tougher,” says Mixey.

Looking forward, Mixey says that NorCal will continue to look for better ways to serve its employees, like making the work environment more enjoyable. “We have three soccer fields for our employees, horse shoe pits and basketball and handball courts,” says Mixey. “They don’t have a lot of down time, but when they do, it gives them a chance to relax.”

He adds the company will also look for ways to improve customer service.

“In self distribution, you’re always looking to reduce costs because we are a cost center,” says Mixey. “But our customers—our stores—understand that and they look to help us because they know they’ll benefit from that. They’re receptive to changes in order to reduce costs and it makes the job much easier for us. Everybody is in this together.”

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