C A SE STUDY
C A S E
S T U D Y
Circuit City Stores, Inc. is a leading national retailer of
brand-name consumer electronics, personal computers and
entertainment software. Circuit City operates more than 600
Circuit City Superstores and a small number of mall-based
stores in 158 markets. The company’s transportation and
logistics team oversees 10 distribution centers, which service
the company’s stores throughout the United States.
“We wanted a proven leader,
someone to provide vision and strategies
for our entire supply chain.”
— Rich Burke, vice president of logistics services
THE PROBLEM
As one of the most successful suppliers of high-demand products, Circuit City’s transportation team tackled the complex challenge
of stocking stores several times a week to meet growing customer demand. The company’s biggest challenge came annually during the
holiday peak season, which strained the company’s existing multiple-carrier system. During the 2000 holiday surge, freight was at an
all-time high and the company had difficulty securing carriers’ commitment to deliver. Service failures resulted, and poor on-time
delivery convinced Rich Burke, Circuit City vice president of logistics services, that it was time to consider alternatives. “We wanted a
proven leader, someone to provide vision and strategies for our entire supply chain,” said Burke.
The company’s immediate needs focused on capacity and service issues, but also included a desire to increase efficiency and cut costs
over the long-run through technology. “We were also looking for someone who could provide visibility to our supply chain and optimize
our routing,” said Burke. Previously, Circuit City team members created routes manually, depending on that night’s deliveries and the
available carriers. “We wanted a more efficient overall process that would also allow us to deliver loads on time, track them through the
shipping process and keep our stores informed about their deliveries,” he said.
THE SOLUTION
Circuit City selected J.B. Hunt Dedicated Contract Services (DCS) in 2001 because of its proven service track record, reliable capacity and cutting-edge technology. “They were very focused on improving our on-time service to our stores and driving costs out of our
system,” added Burke. J.B. Hunt also knew it could help integrate movements among multiple distribution centers and streamline operations. It was also eager to bring proprietary optimization software to the company’s overnight routing process.
THE RESULTS
The relationship began at the company’s Orlando, Fla., area distribution center in August 2001. A smooth start-up there led to
additional dedicated business in Maryland, California and Pennsylvania. Currently J.B. Hunt provides more than 80 dedicated tractors
and drivers servicing more than 380 Circuit City stores, handling inbound from vendors and outbound to the stores. The company also
provides backhaul for returned or serviced merchandise. In addition, J.B. Hunt provides dynamic routing for an additional 160 Circuit
City stores in Illinois and Oklahoma. Results have been significant. “Hunt has done everything they said they would do,” said Burke.
On-time performance – Product is arriving when it’s supposed to with fewer damage claims, according to Burke. Service jumped at least
five percentage points, which Burke says is now electronically tracked. “Our facility managers tell us they get calls from stores requesting Hunt
trucks and drivers make their deliveries. This says a lot about J.B. Hunt’s performance and how they handle the entire delivery process.”
Visibility – Once loads are secured and on the way, J.B. Hunt’s satellite tracking and website allow Circuit City to monitor them and
be certain they arrive safely. Since drivers carry high value products, visibility is extremely important, said Burke. J.B. Hunt’s on-board
computer system ensures continuous communication with drivers that provide early warning for stores should a shipment run behind.
Route optimization – What once used to take up to seven hours on delivery nights now takes less than two, according to Nick Hobbs,
senior vice president, operations, J.B. Hunt DCS. “Our proprietary optimization software has increased their efficiency significantly by
identifying, in a matter of minutes, the best routes for that night’s delivery and allowing the pulling and loading process to begin and
end much earlier. We’ve also been able to cut costs by maximizing cube-per-trailer for store shipments, reducing the number of loads
and employees needed and identifying the low-cost provider for each lane.” J.B. Hunt also searches for shared tractor utilization with
other J.B. Hunt customers when possible to help reduce everyone’s costs.
Collaborative relationship – Weekly meetings are held between J.B. Hunt and Circuit City to review customized reports with
specific measurements — Key Performance Indicators — that align with Circuit City’s financial goals. “The key is good communication,”
said Burke. “We are very customer-service driven, and so is J.B. Hunt. We have made a conscious effort to make them feel a part of our
team and know what we expect. Their results for us are very good.”
www.jbhunt.com
www.jbhunt.com
J.B. HUNT TRANSPORT SERVICES, INC. ■ DEDICATED CONTRACT SERVICES
615 J.B. HUNT CORPORATE DRIVE ■ LOWELL, ARKANSAS 72745
800-643-3622 ■ www.jbhunt.com
All contents of this publication are copyright 2004 J.B. Hunt Transport, Inc. Cover and contents cannot be reproduced in part or in whole without prior written permission from J.B. Hunt Transport, Inc.