Technology management at British American Tobacco
REDUCING BRITISH AMERICAN TOBACCO’S LOGISTICAL AND FINANCIAL BURDEN
CHG-MERIDIAN solves complex logistical challenges for companies – including customized finance strategies. In Switzerland, CHG-MERIDIAN has realized an innovative outsourcing idea for British American Tobacco.
A logistical challenge
In Switzerland, British American Tobacco, one of the largest tobacco companies in the world, regularly needs to supply 5,000 vending machines with tobacco products and other consumer goods.
“Managing our base of vending machines was time-consuming. We had to spend administrative time on operational activities that are not part of our core business,” explains Zoltan Hutkai, Corporate Finance Manager at British American Tobacco Switzerland.
Then there was the additional challenge of upgrading all 5,000 vending machines with new readers to cope with the latest Swiss banknotes. This required major capital investment.
“Getting CHG-MERIDIAN to set up an effectively managed base of vending machines has given us more time to devote to our core business.”
Logistics and financing – a solution based on a well-designed concept
In close collaboration with Deutsche Post subsidiary DHL Switzerland, which handles the logistics and upgrading aspects, CHG-MERIDIAN developed a concept for the efficient management of the vending machines. Newly fitted sensors allow DHL drivers to supply the machines with tobacco products as required, i.e. just in time. As a result, the management at British American Tobacco enjoys increased profits and benefits from modernized machine technology – as well as satisfied customers.
CHG-MERIDIAN also acquired all of the tobacco company’s vending machines in Switzerland and leased them back to British American Tobacco, thereby improving their budget position. The agreed monthly service and lease payments include all costs incurred (e.g. installation, storage and delivery, repairs, and upgrades). This has significantly reduced expense and risk for British American Tobacco, while at the same time the regular payments are making costs clearer and more predictable.
