Dive Brief:

• Newell Brands' integration of 23 business units into a single supply chain will better leverage the company's massive scale, Ravi Saligram, president and CEO, said during a Feb. 11 earnings call.
• Combining product shipments from Newell's different business units will unify its "very fragmented" distribution networks, Saligram said during the earnings call. "We acted like eight — not seven, but eight — sort of $1 billion-plus companies instead of being a $10 billion company," Saligram said.
• The Sharpie, Rubbermaid and Elmer's glue maker also slashed SKUs by 65% between 2018 and the end of 2021 — and isn't finished, said Chris Peterson, CFO and president of business operations.

Dive Insight:

Newell does not expect to be able to attain much cost reduction this year from its suppliers because of the inflation they are feeling, Peterson told analysts on the call.

And many of last year's headwinds — including longer lead times, port congestion, limited container availability and labor constraints — will likely continue through the year, he said.

So the company, which also produces Yankee Candle products and Oster kitchen appliances, is focusing instead on improving operations through its accelerated supply chain strategy, Project Ovid, announced last year.

ERP conversions in 2021 consolidated 95% of sales to two platforms, and Newell plans this summer to launch a distribution arm, "which will allow us to accept one order, send one invoice and receive one payment from customers, while shipping our products on one truck," Peterson said.

The company's writing business, which includes Sharpie, avoided some supply chain snarls last year due to its U.S.-based manufacturing operations. The writing business almost doubled the growth rate of the overall company in 2021, Saligram said on the Q4 earnings call.

Newell is further bolstering its U.S. presence with a distribution center in Newville, Pennsylvania. The facility is on track this month to begin receiving product shipments, which are already on the water en route from China, Peterson said.

Newell's simplified portfolio left it with about 36,000 SKUs at the end of the year, and the company expects to further trim its offerings to streamline operations and mitigate disruptions, Peterson said. Hanes and Mondelēz are among other companies using similar playbooks.

As it centralizes its distribution networks, Newell is also adjusting its trucking strategy.

The company will use full truckload shipments, in favor of LTL shipments, because "it is much easier to secure a full truck delivery than a less-than-truckload delivery in the current environment," Peterson said.