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Delivering Value Beyond A Traditional DefinitionPaolo Montrone ‐ SVP Sea Logistics 

TPM, Long Beach Convention CenterMarch 03, 2013

04/03/2013 p. 2

Market Position• Global No. 1 in Seafreight Growth rates multiple of Market, +6% in 2012 Leading the industry with IT-based solutions Strong partnerships with preferred carriers

• Global Top 2 in Airfreight Well positioned in the top league Cargo 2000 certified (first mover!) Strong partnerships with preferred airlines

• Global Top 4 in Contract Logistics Global infrastructure for global contract logistics coverage Dedicated and shared warehousing & distribution management Transportation management solutions

• Top 6 in European Road & Rail Logistics Focus on network services, LTL & FTL business Pan-European coverage of 38 countries Innovative intermodal solutions

04/03/2013 p. 3

3PL’s have gained significance over the last thirty years

3PL vs Direct (All Trades)1980ies 2012

40% 3PL’sDirect60%

10 % 3PL’sDirect90%

• Asset Intensive / High Capital• Supply / Demand Driven• Focus on providing efficient                                                                            and “green” transport

• People, Process & Technology • Visibility / Flexibility• Focus on Supply Chain optimization

Carriers NVOs/3PLs

04/03/2013 p. 5

Other Costs

TransportCosts

Total International Supply Chain Costs

Working Capital Costs

Sales Effectiveness Loss

Handling & Processing Cost

Emergency Airfreight

Demurrage/Detention

Storage Costs

Administrative CostsCargo value depreciation

FMCG Industry case study

04/03/2013 p. 6

Challenges to  Supply Chains

• Constant changes of vessel network

Maximize supply chain flexibility and responsiveness

• Diverse schedule reliability

Robust Carrier Management and Carrier Selection

• Lack of industry standards

• Data quality/lack of information

Push the Boundary for Data Availability and Accuracy

Specialists Tracking Shipment Status with Carriers for Our Clients

• Disruption from natural events/ strikes

• Proactive Information Sharing• Effective Risk Management

• Full Visibility• Flexibility (Divert in Transit)• IT Infrastructure in 3 Severs

04/03/2013 p. 7

Delivering Value Beyond A Traditional DefinitionSupply Chain as a Competitive Advantage

Source – KN Insight, The State of Logistics Outsourcing – Capgemini Consulting, and 23rd Annual State of Logistics Report – CSCMP

• End-to-end visibility

• SC Value Roadmap

• Supply chain design

• Dem/detention reduction

• Inventory rationalization

• Sourcing support

Shippers Realized Measurable Benefits through 3PL’s partnerships

Case Study: Global Supply Chain Optimization

About the

Client

Fortune 50 US Manufacturer & Marketer with global footprint in the FMCG industry

Challenge• Intense competition• Decline in sales of key trade customers/retailers• Increasing cost of raw material• Drive cost productivity improvement• Insufficient supply chain visibility

The Solution

• Consult, Collaborate & Implement

• Dedicated teams from both Orgs

• Robust framework & methodology

• Identified +USD20 mio savings

04/03/2013 p. 10

Case Study: Last Mile Logistics & Cost Control

About the Client

Challenge

The Solution

Leading automobile manufacturer operating more than 100 production plants globally

• 10,000+ containers, USD1.5 mio demurrage and detention charges• Inefficient delivery communication processes• Inability to identify ETA of a specific part to the Regional DC• Visibility solution consisted of manual spreadsheets & outdated info

• Defined the critical milestone path and accountable parties• Implement Interactive Delivery Planner, enabling planning, approval of appointments and capture milestones by customer’s DCs & appointed truckers

The Result

• Eliminated +98% of demurrage and detention costs• Eliminated overtime shifts (Mon-Fri) at the DC’s• Provided detailed visibility of inventory in-transit