Brazilian Post Office Transforms Logistics and Gains a Competitive Edge

Correios, the Brazilian Post Office (BPO), found itself facing mounting competition as it vied for business with privatesector logistics firms.

Many of the smaller firms it was bidding against had more flexibility to allocate and de-allocate assets, greater agility when responding to customer demands, and lower costs.

BPO was now constrained by some of the same policies and processes that had made it a trusted brand and an important public institution - yet it consistently provided exceptional service and kept pace with technological, economic and social changes.

Goals

• Modernize logistics services while reducing costs
• Adopt an international common process language for logistics across the organization
• Reduce the number of warehouses used by internal logistics operations

Approach

• Enact process improvements, modernize technologies and provide training for the labor force
• Apply the Supply Chain Operations Reference (SCOR) model to optimize logistics operations
• Use SCOR supply chain modeling software to improve performance and process quality

Results

• Cost savings of approximately $60 million annually in internal logistics services
• Order fulfillment cycle time reduced by 25 percent; cost of goods sold reduced by 12 percent
• Delivery accuracy increased 25 percent
• Direct labor costs decreased 79 percent over 12 months
• Return on supply chain fixed assets increased 62 percent over one year