food logistics may 2013
DESCRIPTION
Food newsLogistics newsWarehouse newsSupply Chain newsTRANSCRIPT
Food Logistics
Warehousing and Transportation Solutions for the Food and Beverage Supply Chain
E-commerce and the Supply Chain
Pg. 24
W E B E X C L U S I V E S
New videos, podcasts and audio blogs
Industry insights from Food Logistics’ staff and others
▼▼
W W W . F O O D L O G I S T I C S . C O M
More Perishables,More Supply Chain
Keeping fresh food in optimal condition is an ongoing challenge. Pg. 18
Complexity
Issue No. 146 May 2013
PLUS: SECTOR REPORTS
• Sustainable Pallets & Packages
• Liquid Bulk Logistics
• Load Planning With a JIT Mindset
The Big Thaw in Cold Chain
StoragePg. 30
* National Cash Back Incentives: Take new retail delivery from dealer stock by 7/8/13. Restrictions apply. See dealer for qualif cations, complete details and possible program extension. Offer correct at time of printing; program rules subject to change. **F-350 – F-550 Chassis Cabs: Available on upf ts costing $1,200 or more. Not available on factory-installed options. Units receiving any form of CPA (56A), GPC, Long-Term Rental (56K) or other concessions are ineligible. $4,620 in total savings options for eligible 2013 F-350 – F-550 Super Duty® Chassis Cabs equipped with diesel engines. Eligible vehicles receive $3,000 cash back, $750 in upf t cash allowance and $870 MSRP on maintenance package coverage. For upf t offers on listed vehicles: Take new vehicle delivery by 7/31/13. Restrictions apply. See dealership for details. †Maintenance Plan: $870 MSRP on complete and incomplete vehicles equipped with diesel engines. $375 MSRP on complete and incomplete vehicles equipped with gas engines. Coverage begins at the signature date and current mileage. Coverage expires upon reaching the selected time or mileage or completion of all the maintenance services, whichever comes f rst. Prices and plans are subject to change without notice. Plan availability, benef ts, coverage and provider may vary by state. For more information, please see your dealer or reference the Terms and Conditions on your plan agreement. Take new vehicle delivery from dealer stock between 4/18/13 and 7/1/13.
BUILD YOUR TRUCK.Build your savings.During Commercial Truck Season, when you pick your perfect truck, you’ll start putting together some
serious savings.* Like up to $4,620** on F-350 through F-550 Super Duty® Chassis Cabs. You’ll also get
great savings on E-Series and Transit Connect Vans and Wagons. Hurry in today because Commercial
Truck Season ends July 1. For more details, visit ford.com/CTS.
CASHBACK*
BIG SAVINGS
Upf t
CASH Allowance**
Maintenance†
2-Yr/30K
4 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
MAY 2013 • ISSUE NO. 146
Food Logistics (USPS 015-667; ISSN 1094-7450 print; ISSN 1930-7527 online) is published eight times per year in Jan/Feb, March, April, May, June, July, August, September, October and Nov/Dec by Cygnus Business Media, Inc., 1233 Janesville Avenue, Fort Atkinson, WI 53538, (920) 563-6388. Copyright 2013, Cygnus Business Media, Inc. All rights reserved. Editorial and sales offices: Cygnus Business Media, Inc., 3 Huntington Quadrangle, Suite 301N, Melville, NY 11747, (631) 845-2700, Fax (631) 845-2723. For change of address or subscription information, call (920) 568-3783 or fax (920) 563-1704. Periodicals postage paid at Fort Atkinson, WI 53538 and additional mailing offices. POSTMASTER: Send change of address forms to Food Logistics, Cygnus Business Media, P. O. Box 3257, Northbrook, IL 60065-3257. Canada Post PM40612608. Return Undeliverable Canadian Addresses to: Food Logistics, Station A, PO Box 25542, London, ON N6C 6B2. Subscriptions: US, one year $35, two years $65; Canada & Mexico, one year $50, two years $95; International, one year $75, two years $145. All subscriptions must be paid in U.S. funds, drawn on U.S. bank. Canadian GST #131910168. Printed in the USA.
18
30
34
More Perishables, More Supply Chain ComplexityGlobal consumption of fresh food is rising, and getting it from farm to fork in optimal condition is the ongoing challenge. By Lara L. Sowinski
E-commerce and the Supply ChainThe impact is affecting sourcing, transportation, fulfillment and more.By Lara L. Sowinski
The Big Thaw in Cold Chain StoragePost-recession expansion of the refrigerated warehouse network shows no sign of cooling down. By Lara L. Sowinski
18
30
SECTOR REPORTS
WAREHOUSING: Sustainable Pallets, Packages & MoreGreen products are better for the earth and better for the bottom dollar.By Lauren Levy
TRANSPORTATION: The Logistics of Liquid BulkWine shippers see a value proposition that’s hard to beat. By Lauren Levy
TECHNOLOGY: Can We Apply JIT Thinking to the Outbound Problem?Advanced load planning reduces lead time and lowers labor costs.By Matthew D. Bent
COLUMNS
FOR STARTERS: Keeping Up With Fresh DemandsConsumers want fresh food, a lot of it, and they want it now. By Lara L. Sowinski
COOL INSIGHTS: Cold Chain Management Tools: Assessments and AuditsThese two tools are necessary for comprehensive cold chain management.By David M. Sterling
FOOD (AND MORE) FOR THOUGHT: Protecting Your Supply Chain From Foodborne PathogensExpert tips on how to manage risk in the food supply chain. By Mike Rozembajgier
DEPARTMENTS
8 Supply Scan • 12 Food on the Move • 41 Marketplace • 41 Ad Index
6
16
42
34
38
ON THE MENUCOVER STORY
FEATURES
24
40
Photo © Cynthia Y. McCann
Automated Pallet Delivery in a KitMaterial Flow Made Easy
Introducing FlexTruck easy – a simple, confgurable and cost efectve way to move pallets in your
operaton. The Flex Truck easy kit comes with everything you need to create your own tailored
pallet delivery system and includes:
• FlexTruck easy pallet vehicles - automatcally moves pallets
• Control Center - reportng, trafc control
• Guide path laser targets - guide vehicles along path
• Wireless call/dispatch statons - to direct pallet delivery destnatons
The kit is portable and re-usable and can be moved or reconfgured as your
requirements change.
Learn more about FlexTruck easy - the affordable replacement for manually
operated fork trucks. Visit www.dematic.com/AGV or contact us at
[email protected] or 1-877-725-7500.
F R O M T H E E D I T O R ’ S D E S K
FOR STARTERS
Consumers want fresh food, a lot of it, and they want it now. Our cover story this month looks at perishables in the supply chain. Sufce it to say that despite tighter food budgets for many American households, spending on fresh food is actually rising as many people incorporate fresh fruits and vegetables
into their diets.Grocery retailers know that fresh food ranks high when it comes to where consumers
choose to shop, and they’re putting time and resources into better merchandising and selection at the store level, while the transportation and distribution needed to keep fresh food flowing through the supply chain is also tasked to perform at its highest level.
On the sourcing side, it’s getting more complex. More grocers are incorporating locally-sourced fresh foods into their overall product mix, along with fresh food that has traveled thousands of miles, thanks to advancements in refrigerated and controlled atmosphere technology.
For example, just last month California-based Global Fresh Foods announced that it would begin shipping fresh salmon via ocean container from Chile to the U.S. West Coast. A new technology they developed makes it possible to manipulate oxygen levels inside the container so that deterioration of the fish, and growth of bacteria, are essentially stalled during transit.
Previously, fresh salmon from Chile to the U.S. West Coast moved via airfreight, typi-cally through Miami. Putting fresh salmon in an ocean container for a 40-day voyage was unheard of until recently, and there are similar trade-changing developments popping up more frequently these days.
E-commerce is also responsible for driving new realities in today’s supply chains, even ones for fresh food. During my research for the e-commerce article this month, I was surprised to learn just how many new online food and grocery sites are out there. All the big guys are scrambling to figure out how to make large-scale e-com grocery work—Amazon.com, Google, Walmart, Target—everyone’s got their eye on the prize, even the smaller, local players. This is one story we’ll undoubtedly be covering more in-depth going forward.
The rest of our editorial this month also complements the topics of perishables and e-commerce. Inside you’ll find an update on the public refrigerated warehouse sector, along with reports on liquid bulk transportation trends in the wine industry, a by-lined article from Syntelic Solutions’ Matt Bent on load planning software, and coverage on pallets, packages and containers in our warehousing sector report. Our Cool Insights col-umn this month is an “encore presentation” from Georgia Tech’s Integrated Food Chain Center on cold chain management tools—it was popular with our readers when first published and deserves some extra exposure.
We’ve been hitting Twitter hard in recent weeks after a temporary hiatus and will soon roll out some much needed Web site improvements too.
We’ll keep you posted.Enjoy the read.
LARA L. SOWINSKI,
EDITOR-IN-CHIEF
S O W I N S K I
W W W . F O O D L O G I S T I C S . C O M
Gloria Cosby, Executive Vice President,
Agriculture, Technology and Transportation Group
Jolene Gulley, Publisher
EDITORIAL
Lara L. Sowinski, Editor-in-Chief
262-443-5919; [email protected]
Lauren Levy, Assistant Editor
920-568-8680 x1680; [email protected]
John Sidor, Art Director
631-963-6362; [email protected]
Editorial office: 3 Huntington Quadrangle, Suite 301N,
Melville, NY 11747 Fax: 631-845-2723
EDITORIAL ADVISORY BOARD
Jaymie Forrest, managing director, Georgia Tech’s
Integrated Food Chain Center
Peter Mehring, CEO, Intelleflex
Kam Quarles, director, legislative affairs, McDermott
Will & Emery LLP
Pamela Erb, vice president of supply chain, Wegmans
ADVERTISING SALES
Judy Welp, East Coast Sales Manager
480-821-1093; Fax: 480-240-4897
Sharon Cordina, West Coast Sales Manager
847-454-2728;
Sara-Emily Steadman, Classified Sales Manager
800-547-7377, ext. 1344
PRODUCTION
Suzette Schear, Production Director
631-963-6260 Fax: 631-845-4069;
REPRINT SERVICES
For reprints and licensing please contact Nick
Iademarco at Wright’s Media 877-652-5295 ext. 102
CIRCULATION
Tammy Steller, Audience Development Manager
For change of address or subscription information:
Toll Free — 877-382-9187, Local — 847-559-7598,
Email — [email protected]
LIST RENTALS
Elizabeth Jackson, List Rental Manager
847-492-1350 ext. 18; Fax: 866-596-0280
John French, CEO
Paul Bonaiuto, CFO
Gloria Cosby, E.V.P., Agriculture, Technology and
Transportation Group
Julie Nachtigal, V.P., Audience Development
Eric Kammerzelt, V.P., Technology
Rob Brice, S.V.P., Cygnus Expo
Curt Pordes, V.P., Production Operations
Ed Wood, V.P., Human Resources
6 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Keeping Up With Fresh Demands
Johnson Refrigerated Truck Bodies | 800.922.8360 | www.johnsontruckbodies.com
With the industry’s most thermally effcient temperature-controlled truck body equipment.
Over eighty years of experience and innovation has made Johnson the leader in insulated composite truck bodies that
are cost-effcient and lighter in weight than ever before. Choose from four standard models pre-engineered at competitive
prices…or from a wide range of custom options including emission-free all-electric refrigeration.
Whichever model you choose, you can be sure that it offers the industry’s highest levels of strength and durability,
backed by FleetWise™ authorized service repair at Great Dane locations nationwide.
keepmoving
& never lose your
cool
b e v e r a g e | d a i r y | f r o z e n f o o d | f o o d s e r v i c e | i c e | i c e c r e a m
m e a t a n d s e a f o o d | p r o d u c e | v e n d i n g p r o d u c t s | l i v e p o u l t r y
NEWS FROM ACROSS THE FOOD SUPPLY CHAIN
SUPPLY SCAN
8 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Bee Decline Linked To
Pesticide Use
A class of pesticides called neo-
nicotinoids have been linked to
a decline in bees, butterflies and
other pollinators. These pesticides
were developed to be less harmful
to beneficial insects and mammals,
but have impacted the ecosystem,
resulting in what scientists call
Colony Collapse Disorder.
Neonicotinoids have been used
since the late 1990’s in crop seeds.
The pesticide binds to receptors in
an insect’s nervous system killing
them and keeping corn and soya
bean crops safe. Unfortunately, it
appears that collateral damage has
occurred in bees and other pol-
linators who have come in contact
with the plants.
European food safety regulators
determined that the use of clo-
thianidin, imidacloprid and thia-
methoxam—the three most com-
mon neonicotinoids—should be
minimized for use in certain crops.
It was followed by a proposed two-
year ban on these chemicals by the
European Union.
Meanwhile, UK grocery chain
Waitrose is taking action to avoid
stocking shelves with products that
have used these pesticides.
Food Hackathon &
the Future of Food
Technology
Recently, bloggers, foodies, and
software developers gathered in San
Francisco for the Food Hackathon
to discuss the future of food tech-
nology. The event’s creator, Matt
Wise, said the goal is “to harness
intellectual and creative capital to
focus on innovative ways to solve
problems that affect the entire food
ecosystem.”
The winner from this year’s
event was an iPhone app called
Vibrantly. The app helps a user
make positive food choices
according to a food’s color. Color
is important, according to the
developer, because studies indicate
that it “stimulate[s] your right
brain” and will motivate a positive
behavioral change. Food color is
also linked to nutritional quality
and this helps the user make wiser,
more health-conscious decisions.
The link between food and
technology is growing with $350
million invested in related fields
during 2012.
Venture Capitalists Bet
Big on Food Start-Ups
Venture capitalists in Silicon
Valley have begun making signifi-
cant investments in food start-ups.
The emerging sector offers a lot in
terms of investment opportunity.
Investors are excited about fields
that have a sustainable or environ-
mental appeal, while others are
attracted to the health and fitness
angle. Still others see food start-ups
as good places to grow technology
and advertising related investments.
“There are pretty significant
environmental consequences
and health issues associated with
sodium or high-fructose corn syrup
or eating too much red-meat,”
explained Samir Kaul, a partner at
GMO Labeling Bill Intro-
duced Into Congress
Sen. Barbra Boxer (D-Calif.)
and Rep. Peter DeFazio
(D-Oregon) have introduced
legislation that would require
genetically modified foods to
be labeled. Otherwise known
as the “Genetically Engineered
Food Right-To-Know Act”
this federal legislation would
mandate that foods made from
genetically modified seeds or
other ingredients would need to
be labeled.
© T
ravis
S.
Pra
tt
Fresh is always
in fashion.
© 2
01
3 C
.H. R
ob
inso
n W
orld
wid
e, In
c. A
ll Rig
hts
Reserve
d. w
ww
.ch
rob
inso
n.c
om
Scan this code to download a FREE copy of our food & beverage white paper.
Impeccable taste.
Your products have it. Your customers want it. Satisfy their cravings by
working with a trendsetter in food and beverage shipping. Some of the
biggest names in the world already trust us to get their products to market
on time. We can do the same for you.
Call to learn how you can consistently deliver products to your customer
at the pinnacle of freshness.
[email protected] | 800.323.7587
SUPPLY SCAN
10 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
NEWS FROM ACROSS THE FOOD SUPPLY CHAIN
Khosla Venture, to the New York
Times. “I wouldn’t bet my money
that Cargill or ConAgra are going
to innovate here. I think it’s going
to take start-ups to do that.”
Iowa Judge Moves to
Block Pink Slime Study
Iowa State University recently
conducted a study on ‘pink slime’
in hopes of shedding light on
the controversial beef additive.
However, Judge Dale Ruigh from
Iowa City, Iowa, decided to block
the university from releasing the
results of the study claiming that
the report could cause “irreparable
harm” to the beef company and
would “damage Beef Products Inc.
by revealing information about its
proprietary food-processing tech-
niques.”
So-called pink slime is added to
lean, finely textured beef product.
During this process the lean beef is
exposed to either ammonia or citric
acid to kill any bacteria in which
the meat may have been exposed to
during this process.
Although this additive is consid-
ered by the meat industry to be safe
for consumption, public concern
has grown considerably.
GAP Questions the Safety
of Chemicals in Poultry
Plants
The Government Account-
ability Project (GAP), a whistle-
blower protection organization, is
investigating the impact of harsh
chemicals used to disinfect poultry
processing plants.
Federal inspectors have agreed
to team up with whistleblowers to
examine the health implications
related to chemical exposure for
employees in these types of plants.
Already, the Government Account-
ability Project has published two
affidavits where FDA inspectors
have stated there is “great concern
over chemical use.”
Indeed, many of the affidavits
collected over two years’ time were
particularly worrisome. Some of
the problems identified included
leaving contaminated carcasses on
the line with other birds; while
employees suffering serious health
problems, such as breathing prob-
lems, were unable to receive treat-
ment.
For their part, inspectors claim
their concerns and safety reports
continue to be ignored or ineffec-
tively addressed.
Many companies, meanwhile,
have allegedly ignored physician’s
warnings that the chemicals used
during poultry processing could
negatively affect employees’ health.
In one case, a company’s
response to poor ventilation was to
install overhead fans, which simply
circulated airborne chemicals rather
than expelling them.
Putting a Number on
Global Food Waste
Each year, two billion tons of
food will end up in the trash. To
put that in perspective, two billion
tons of food is equal to half of all
the food produced in the world
annually. It seems unbelievable that
hundreds of millions of people go
hungry across the globe every year
while half of all food produced will
end up thrown away.
The UK’s Institution of
Mechanical Engineers blames the
high level of food waste on a few
specific factors: “Strict sell-by dates,
buy-one-get-one free promotions,
Western consumers’ demand for
cosmetically perfect food; poor
engineering and agricultural prac-
tices; inadequate infrastructure; and
poor storage facilities.”
In the UK, 30 percent of crops
were not harvested due to their
failure to meet retailers’ exacting
standards on physical appearance,
while up to half the food that is
bought in Europe and the U.S. is
thrown away by consumers.
Arsenic In Chicken Feed?
The San Francisco Federal
Court is hearing a case that claims
lax federal regulators allowed
arsenic-based additives in chicken
and pig feed. Eight groups, includ-
ing the Center for Food Safety, are
suing the federal Department of
Health and Human Services, claim-
ing that arsenic has the potential to
case cancer in humans and needs to
be immediately removed from all
animal feed.
In the 1940’s, arsenic was
approved for use in animal feed.
And “more than 70 years later,
arsenic-containing feed additives—
namely Roxarsone, arsanilic acid,
nitarsone, and carborsone—are still
used in chicken, turkey and swine
production,” states the complain-
ant.
In 2004 and 2005, the plaintiff
tested retail products made from
raw chicken and chicken used in
fast food chains. The results found
that chickens, which were fed food
with no arsenic, had no detectible
arsenic levels in the food. Chicken
that had consumed feed with
arsenic did have testable levels of
arsenic.
According to the plaintiff,
“These results strongly suggest
that the use of arsenic-containing
compounds in poultry feed leads to
arsenic residues in chicken market-
ed and eaten in the United States.”
Most important is the defen-
dants’ claim that the FDA failed
to act on their request to revoke
arsenic-containing feed.
Germany Raises Food
Waste Awareness Through
‘Best-By’ Date
Germany is raising awareness
and reducing food waste by edu-
cating their citizens about how to
properly use the ‘best-by’ dates on
food as guidelines.
The Agriculture and Consumer
Protection Ministry will distribute
pamphlets throughout supermar-
kets as a way to alert the general
population that expiration dates
are not exact dates in which to
trash food. The pamphlets will also
inform German citizens that they
each waste 181 pounds of food a
year. The pamphlets will be circu-
lated in 21,000 markets.
The Risks With Raw Milk
A single vote this month kept
a ban on raw milk illegal in Mon-
tana. House Bill 574 would have
shifted liability should anyone
become ill from ingesting contami-
nated raw milk, from the producer
to the consumer.
In Pennsylvania there had been
an outbreak of campylobacter that
sickened 148 individuals after
ingesting raw milk, which was
published in Clinical Infectious
Disease in January 2012. This dairy
had a permit to sell unpasteurized
milk. They had passed inspections
and were diligent in testing for E.
coli. Even with these protections in
place there still exists a danger of
consuming unpasteurized dairy.
Criminals In China Sell
Rat Meat As Lamb
Chinese authorities in Shanghai
and Jiangsu have wrapped up a
three month long investigation and
detained 63 individuals who were
implicated in a criminal ring selling
fox, rat and mink meat to restau-
rants as lamb.
Reportedly they made more
than $1.6 million dollars (10 mil-
lion yuan) selling this meat to
unsuspecting markets and restau-
rateurs. The men had to treat the
meat with additives and chemicals
to mask its animal original origin.
This incident comes right on
the heels of a number of safety
violations recently making news in
China. In December Yum! Brands
Inc. was accused of feeding mass
amounts of antibiotics and growth
hormones to their chickens. In
March thousands of dead pigs and
chickens were pulled from the
Huangpu River.
L O G I S T I C S T R E N D S I N O U R I N D U S T RY
FOOD ON THE MOVE
12 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Lineage Operating Tennessee Cold Storage Facilities for Rich Products
Lineage Logistics has begun operating two
cold storage facilities in Arlington and Mur-
freesboro, Tennessee. The warehouses are for
its client, Rich Products Corporations, which
specializes in non-dairy frozen foods.
According to Refrigerated Transporter, the
Arlington facility was built in 2005 and is 4.3
million cubic feet. The facility in Murfrees-
boro was built in 2002 and offers 5.3 million
cubic feet of space. Both facilities are located
close to Rich Products’ production plant.
Hong Kong Dockworkers Stage Strike
An estimated 450 “May Day” strikers in
Hong Kong called for better working condi-
tions and higher wages at a protest earlier this
month. Specifically, workers were looking
to secure a 15 to 18 percent pay raise. Previ-
ously, they had rejected a 7 percent pay hike
offered during tense negotiations.
A scheduled pay hike will go in effect
this month, bringing the minimum wage to
HK$30 or US$3.90. That represents a seven
cent pay raise above the current minimum
wage rate.
A representative for Hong Kong Inter-
national Terminals said that workers are
employed by subcontractors and therefore
could not be directly involved in salary nego-
tiations.
U.S. Pushing WTO to Improve Food Safety
During the last WTO meeting, the U.S.
discussed how agricultural policy reform
affects food safety, and are committed to
take a proactive position to examine “the full
range of trade-related government measures”
that can contribute to the goal of enhancing
food safety.
Agricultural policy reform has been a
long-standing controversy within the WTO.
In 2001, the global trade body attempted
to cut farm subsidies and tariffs on agricul-
tural goods, but this goal was never met, in
part because of U.S. insistence that more
advanced developing countries, such as China
and Brazil, offer up better deals in exchange
for proposed cuts to U.S. farm subsidies.
U.S. Ambassador to the WTO Michael
Punke hopes there can be some agreement
when WTO member-nations meet in Bali
this year. In particular, he said the new pro-
posal should “examine the effectiveness of
pubic stockholding and administered prices
in addressing food security concerns, as well
as how to improve food security though
better-functioning markets.”
Maersk Launches Triple E ShipsMaersk’s new “Triple E” vessels will soon
begin navigating the Northern Sea trade lane.
The new generation of vessel is 400 meters
long and 59 meters
wide, making the
Triple E the world’s
largest container
ship and capable
of carrying up to
18,000 TEUs.
Despite its enormous size the vessel is also
incredibly energy efficient. The Maersk Triple
E emits half the CO2 of conventional con-
tainer ships. The vessel is also designed to sail
with a maximum cargo load at a slow steam-
ing pace, which reduces “negative effects on
the environment,” acording to Maersk.
HS Logistics, a UK-based frozen transport operator, has
added two 7.5 ton reefer trucks to its “panic” delivery feet, so-
called because they’re used for last-minute orders. The trucks,
contracted from Ryder Europe, are custom-ftted with sleeper cabs
and single compartment Paneltech bodies with Carrier Xarios direct drive
refrigeration units.
According to a Ryder Europe press release, the new trucks carry up to 7
pallets and can expedite the delivery of last-minute orders or shipments to
regions where it is not economically feasible to deploy a larger truck.
Ryder Europe Trucks Ease “Panic” Delivery Fleet
14 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
L O G I S T I C S T R E N D S I N O U R I N D U S T RY
FOOD ON THE MOVE
The Triple E also has an energy-saving
waste heat recovery system, which captures
and recycles up to 25 percent of energy
released by the ship’s engine.
Maersk’s new target goal is to reduce its
total CO2 emissions by 40 percent by 2020.
Europe Testing New Aerodynamic Trucks
A new aerodynamic truck is being tested
in Europe that would reduce carbon emis-
sions while “giving a boost to the struggling
auto sector,” claim EU officials.
Siim Kallas, European Transport Com-
missioner, explained that, “a brick is the least
aerodynamic shape you can imagine,” when
referring to the current box shape of most
trucks. “That’s why we need to improve the
shape of our trucks on the roads.”
Seventy percent of Europe’s freight is car-
ried by road transport and the new design
has the potential to set a standard in design
stability and ultimately save money.
For example, the trucks feature a uniquely
curved windshield, which not only adds to
the aerodynamics, but improves driver vis-
ibility.
If the EU chooses to adopt these trucks,
they will begin operating by 2018-2020.
Watch Commercials Right From Your Shopping Cart
Washington state-based Yoke’s Fresh Mar-
kets will start using RFID-tagged shopping
carts to promote items in one of their test
stores. As customers walk down an aisle in
Mead, Washington their carts will trigger
advertisements that play on a seven-inch
screen attached to the shelves.
There are currently 18 to 20 RFID read-
ers strategically placed around the test store,
which can track customer movements and
feed data back to Yoke’s cloud-based network.
After the advertising is triggered, the cus-
tomer is prompted to touch the screen. As
the customer goes to purchase that item they
will automatically be given a discount at the
counter.
The RIFD technology allows companies
better access to customers’ purchasing habits
and in-store behavior, which will help retailers
improve the placement of merchandise and
develop more effective marketing techniques.
Possible Dole Deal for Port of Hueneme
Japanese trading house Itochu decided not
to close a vegetable oil deal with the Port of
Hueneme in Ventura County, California.
However, the Port has high hopes that it
can secure business from two units of Dole
Foods, which was recently purchased by
Itochu.
Currently, Dole has a 24 1/2 year lease
with the Port of San Diego, and it’s unclear
whether there is an early escape clause built
into that contract.
Oxnard Harbor Commissioner Jason
Hodge, said, “We are actually in a better
position with Dole now than we have been in
the past…now is the perfect time to try and
bring them on as a future business.” This deal
could potentially make the Port of Hueneme
one of the largest food processing centers in
the world.
11,700 New Trucking Jobs AddedThe total unemployment rate dropped
to 7.5% in April. 114,000 additional jobs
were added in March. This year trucking has
added a total of 11,700 new jobs.
In March the trucking industry had lost
6,300 jobs. This number is still 600 fewer job
losses than February’s total of 6,900.
Within the transportation sector* the total
number of jobs added amounted to 4,200 in
the month of April. March reported a decline
of 2,800.
*Transportation sector employment also fac-
tors in trucking jobs
Illegal West African Tuna Shipments Seized
Tuna shipments imported into the UK
from West Africa were seized recently amid
fears they had been caught illegally. The
Department for Environment, Food and
Rural Affairs warned seafood companies in
February that there were “serious concerns
about the contamination of the EU sup-
ply chain and IUU (Illegal, Unreported &
Unregulated fishing) fisheries products.”
In particular, officials suspect the West
African tuna may have been imported using
false documents. The UK receives approxi-
mately 10 percent of its tuna from Ghana,
which totals £27million annually.
The complaint prompted action from oth-
er EU states. Spain, for example, has become
more vigilant and has rejected shipments of
tuna from Ghana, suspecting it was also pro-
cured illegally.
Air Cargo Germany Forced To Declare Insolvency
Air Cargo Germany declared itself insol-
vent closely following the suspension of its
German operating certificate on April 18th
by the LBA (Luftfahrt-Bundesamt). Airline
debt had many worried that overall safety
might be compromised.
Prior to the declaration of insolvency an
unnamed source discussed the possible future
of Air Cargo Germany in the Loadstar.com,
“I think it won’t come back, the current mar-
ket environment appears to be unfriendly to
all-cargo-airlines, in particular those outside
of niche markets.”
Air Cargo Germany is hoping that there
will be an opportunity for company restruc-
ture. CEO Michael Schaecher wrote, “All
options will be taken into account to restore
customer confidence.”
Panama Canal Loses Out To Suez
Authorities at the Panama Canal antici-
pate a 2.4% decline in cargo volume this
fiscal year. Traffic at the Panama Canal has
dropped off as some ships have decided to
re-route through the Suez Canal citing the
cheaper cost.
Maersk Line, whom once was the Panama
Canal’s top customer, decided to route some
of their ships through the Suez Canal this
March. The trip adds 11 days to the journey
but ultimately will save the company money.
The Panama Canal is still undergoing a
$5.25 billion expansion and should open in
2014-2015.
Scan to see our
3000R® Video
To fi nd out more, call your local dealer or visit www.utilitytrailer.com
by computer or mobile device.
Every Utility® trailer is represented by the most knowledgeable dealers in the transportation business.
: Street Smart
© 2
013
Uti
lity
Tra
ile
r M
an
ufa
ctu
rin
g C
om
pa
ny.
All r
igh
ts r
ese
rve
d.
Whether it’s local,
regional, national
or international
the Utility 3000R®
reefer comes standard
with the industry’s only
comprehensive 360° foam-
in-place insulating solution.
You can trust the 3000R®
to deliver on its promises.
So, if you need to get lobsters from Maine to Manhattan we can design the perfect trailer to meet your delivery challenges.
Utility dealers and product engineers have the
trailer industry knowledge that provides specifi c
solutions to your refrigerated transportation
challenges. And, our 106 dealer locations offer
unparalleled service and support. It’s no wonder
the #1 selling reefer in the Americas is sold exclusively
through the #1 independent dealer network. Together,
we think internationally, but act locally.
V I E W S F R O M G E O R G I A T E C H ’ S I F C C E N T E R
COOL INSIGHTS
16 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Two essential tools used as a part of the
cold chain management process are
assessments and audits. Tese tools
are utilized at diferent points in the
cold chain management process and
have diferent objectives. However, at
times they may be combined to accomplish dual
objectives.
The cold chain assessment is designed to
measure the effectiveness of the cold chain
management process. Through the assessment,
gaps are identified, issues are raised, and risks
are determined. Upon completion of the assess-
ment, management will have a good perspec-
tive on where resources should be deployed in
addressing cold chain risks. Of course, the hard
part comes after the assessment—what must
be put into place to address the risks and issues
identified?
The assessment is actually the first part of the
overall cold chain management process. These
management elements include:
• Assessment
• PolicyDevelopment
• ProcessDevelopment
• ManagementPracticesandControls
• Audit
• PerformanceFeedback/PostAuditResults
Mostcompaniesalreadyhaveatleastsome
portions of the cold chain policy developed and
have implemented specific processes, practices,
and controls as a part of that policy. However,
the assessment focuses on where policy and con-
trolsfallshort.Assessmentresultswillhighlight
areas and process gaps needing special attention.
Before beginning the assessment, manage-
ment must determine its scope, both in terms
of process and products. How far upstream and
downstream will the assessment cover? What
products or product groups will be included?
These scope decisions will include tradeoffs of
efficiency versus comprehensiveness. The assess-
ment begins with an understanding of product
movement, transactions, information flows, and
process times. This information often provides
insight about the entire cold chain not previ-
ously known by management.
Once the process is detailed and mapped,
critical reviews are made. One of the best meth-
ods to identify risks is a systematic, thermal
mapping of product and ambient temperatures
throughout the end-to-end cold chain. It should
be performed over multiple days, conditions,
carriers, route or trip durations, facilities, et
cetera in order to provide a practical operating
reality. The data should be summarized graphi-
cally to show a single system result across all
testing performed. It is usually very difficult
to understand the behavior of the system when
only multiple, individual snapshots of results
are provided. In other words, a grasp of totality
must be reported in meaningful ways.
Once completed, testing results and reviews
must be correlated to provide a consistent
understanding of the cold chain. In many
cases, this process yields completely unexpected
results.Anexampleoftheunexpectedoccurred
during an assessment involving a multi-delivery
routeofrefrigeratedproductinMinnesota
during a frigid January. Our findings indicated
exceptionally high product temperatures for sev-
eral risky meat products. This was unexpected
becauseofsingledigittemperatures.Further
analysis revealed that because of the cold
weather, refrigerated trailers were being heated
by the driver.
Whereas an assessment is performed to
determine areas at risk and requiring corrective
action, the audit is used to determine if the cold
chain actually operates as intended for those
processes designed by management. The audit
reviews compliance with processes and controls
specifiedandestablishedbymanagement.For
contrast, the assess-
ment is about the
design of the cold
chain and whether
its processes are
adequate versus
compliancewiththoseprocesses.Management
may have designed excellent cold chain manage-
ment processes, but if not executed as intended,
the system will be fraught with risk.
To begin the audit process, scope is deter-
mined, objectives are set, and the process design
isprovidedbymanagement.Audittestsare
then designed to test compliance with the poli-
cies that management has implemented. Ide-
ally, these tests are designed statistically so that
results can be summarized with a confidence
level and precision. In addition, other process
testing is conducted as an additional way to
determine the processes in place are yielding the
results intended. This may include individual
temperature samples and product temperature
tracking over several days, conditions through-
outdistributionareas,andsoon.Asinthe
assessment, if the results of the compliance test-
ing are not consistent with the process testing
results, then further analysis must be done. In
some cases, it may be determined the process is
operating as intended, but the process is ineffec-
tive at controlling product quality.
Assessmentsandauditsarevaluableelements
of the cold chain management toolkit. The
assessment is most effective in gauging the effec-
tiveness of cold chain design, while the audit is
the essential component in evaluating how well
the management oversight process works.
Agreatwaytostayontopofthelatesttrends
in the supply chain sector is to participate in the
professional education courses offered through
GeorgiaTech’sSupplyChainandLogistics
Institute.Formoreinformationonupcoming
courses,visitwww.scl.gatech.edu/professional-
education/calendar/.◆
David M. Sterling is a partner with Sterling
Solutions and is a co-founding member of Georgia
Tech’s Integrated Food Chain Center.
Cold Chain Management Tools: Assessments and Audits
B Y D A V I D
M . S T E R L I N G
The assessment focuses on where
policy and controls fall short.
LINEAGE LOGISTICS:
A new name backed by over a century of heritage and experience.DEDICATION SETS LINEAGE APART
Lineage Logistics is a warehousing and logistics
company built to deliver sophisticated, customized and
dependable cold chain solutions. Lineage has one of the
largest facility networks in the U.S. forged through the
combination of entrepreneurial companies with long
histories and strong reputations. We are a company of
creative people dedicated to getting the job done and
absolutely committed to customer service.
lineagelogistics.com
1 (800) 678 7271COMPLETE COLD CHAIN SOLUTIONS
C O L D S T O R A G E
Washington
Cityice Seattle
Seafreeze Seattle
Oregon
TFL Brooks
TFL Salem
California
Colton 1
Colton 2
Rialto
Riverside
Stockton
TFL Oxnard
California (cont’d.)
TFL Watsonville
Vernon 1
Vernon 2
Texas
Coppell
Ft. Worth
TFL San Antonio
Missouri
St. Louis 1
St. Louis 2
St. Louis 3
Georgia
FRS Albany
FRS Savannah
FRS Unadilla
Macon
Illinois
Decatur
Joliet
University Park
Maryland
Baltimore 1
Baltimore 2
Virginia
RCS Airport
RCS Norfolk
RCS Smithfeld
RCS Southern
North Carolina
RCS Tar Heel
Global consumption of fresh food is rising, and getting it from farm to fork in optimal condition is the ongoing challenge.
B y L A R A L . S O W I N S K I
More Perishables, More Supply Chain
18 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
COMPLEXITY
Consumer trends and regulatory crackdowns
In the U.S., the fresh produce industry is valued at $100 billion and growing. More healthy eating habits along with Americans’ desire for fresh fruits and veg-etables year-round are big drivers.
At the same time, emerging markets in Asia, Latin America, Eastern Europe and the Middle East and Africa are adopting Westernized palates, which means more fresh (and frozen) food is being transported, oftentimes over great distances. The easing of trade restric-tions and the formation of new free trade pacts is also expanding fresh food imports and exports.
Not surprisingly, longer transit time and distance puts more pressure on fresh food shippers and transportation provid-ers. Profit margins in the food sector in general are already relatively thin, which means it’s imperative to avoid any com-promises to temperature or proper han-dling that can lead to shorter shelf life or complete spoilage altogether.
More advanced refrigerated equip-ment, storage, and software and tech-nology tools that continually monitor temperature and environment make it possible to support a global supply chain for fresh food. However, there are some glaring weak links in this chain, which are mostly related to cutting corners as opposed to lack of adequate equipment.
Last year, Indiana’s state police began cracking down on hot trucks—refrig-erated trucks that transport food in trailers whose temperature exceeds safe limits. The crackdown made national headlines because of the sheer number of refrigerated shipments that were non-compliant. An unusually warm summer exacerbated by steep fuel prices were partly to blame for the high number of hot trucks snagged in the crackdown, according to the state’s law enforcement and public safety officials.
Recently, Indiana implemented stiffer laws that give state police authority to impound trucks that transport food in unsafe conditions and levy steep fines
on drivers. The state now boasts some of the strictest food transportation laws in the nation.
In California, tougher rules govern-ing refrigerated trailers, which came into effect on January 1, also have steep fines attached for non-compliance. For example, soon after the new regulation was implemented, the California Air Resources Board (CARB) fined Ontario, California-based Foster Enterprises $300,000 for failing to upgrade its diesel engines on its refrigerated trailer fleet to meet the new emissions standards.
Meanwhile, the Food Safety Modern-ization Act (FSMA) is also ratcheting up regulations—and fines—surrounding refrigerated transportation of food as it continues its phase-in.
Advances in equipment and technology
For shippers not willing to sacrifice food safety, the good news is that the latest equipment and technology is mak-ing it easier, safer, more environmentally friendly, and even cheaper in some cases to transport fresh and frozen food.
Manufacturers of refrigeration units along with manufacturers of refrigerated containers and trailers are constantly improving their products, from the design and engineering of the cooling units to the insulating ability and per-formance of the containers and trailers. In addition, other companies are intro-ducing new software and technology to monitor and control temperature and environment.
Indeed, the market for cold chain monitoring tools has plenty of room to grow, according to Tom Chicoine, vice president of business development for Cooltrax.
“Approximately 500,000 trailer refrig-eration units operate across the United States, but only an estimated 15 percent of these vehicles operate with on-board telematics technology,” he states in a recent white paper. “Companies operat-ing trucks without this technology deny their fleet managers the ability to moni-
C O V E R S T O R Y
www.foodlogistics.com FOOD LOGISTICS • MAY 2013 19
he recession has forced grocery shoppers in the U.S. to place an even greater emphasis on price and value. There-fore, private label brands have become more popular
over the past four years, as have discount grocers and club stores. Yet, access to high quality produce and a great selection of fresh food continue to rank high on consumer surveys.
T
© iS
tockp
ho
to/T
hin
ksto
ck
20 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
tor reefer unit and refrigerated box temperatures, or to be alerted to truck locations and open-door durations. Fleet managers also lack the ability to remotely change reefer settings when necessary. Having these capabilities allows transportation firms to react when tempera-tures fall outside of accepted ranges—whether based on government regulations or internal requirements. More importantly, having these capabilities can help companies avoid catastrophic consequences.”
While remote monitoring devices have been available for years, telematics technology that allows for remote management of tempera-ture and environment is still relatively new, notes Chicoine.
Telematics technology can zero in on other problems in the cold chain, he says. “One food transportation company discovered that some drivers left the doors open from their arrival until their depar-ture at each delivery location—often for 20 minutes or more. The company instituted a policy requiring drivers to close their trailer doors immediately after removing products. Not only did this new SOP (standard operating procedure) ensure product temperatures remained consistent, with telematics, the company was able to moni-tor drivers.”
For companies looking to invest in telematics technology, Chicoine advises considering solutions “that extract as much data as possible through alerts, fault codes, temperature set points, door open/close statuses, and geo-zone tracking. The data can serve as the ultimate proof of your company’s ability to properly care for food and adhere to regulations.”
In the meantime, containerized ocean carriers are transporting more refrigerated cargo while the specialized reefer carriers are losing market share, and they’re investing in equipment and technology to support this key business segment.
C O V E R S T O R Y
BY JEFF STOUT
he advance ship notice (ASN) is essentially an electronic com-
munication from a vendor or supplier to its customer advising
them that a shipment has been created against a purchase
order (P.O.) with specific item(s) and quantities. At shipment level,
an ASN can provide basic information about the order. More advanced ASNs
can offer detailed information via case/pallet level license plate identification,
which can be imbedded to include data elements such as end customer/
store, lot numbers, expiration dates, catch weight and even country of origin/
pedigree information. This visibility can be extremely valuable and provides
the key to unlock the handcuffs on your supply chain. In order to fully under-
stand the power of the ASN, let’s take a look back.
Many retailers have been utilizing ASNs and ASN compliance with their
vendors for more than 20 years and they have come to fully appreciate their
value. For example, a large department store will require an apparel supplier
to do a “ship to/mark for”, meaning that the ASN label on that carton already
earmarks the contents for a specific store location. Once it arrives at the dis-
tribution center that carton will be cross-docked directly to the targeted store
without being opened, reducing handling and transit time to the selling floor.
Another method is for the cartons to be pre-packed with an assortment that
is defined at the ASN level. These cartons are then scanned at receipt and
systemically directed to an associated store location thus eliminating the need
to put-away, replenish and pick the products, reducing labor and increasing
the speed of processing.
However, grocery retailers have been slow to adopt detail level ASNs. It
could be due to the typical “pull” environment where the store locations order
the required inventory, which creates the store order that is provided to the
operations of the grocery DC, versus the “push” environment of other retailers
where POS feeds a replenishment system that creates the orders. So it may
seem on the surface that ASNs and flow-through distribution won’t work in
the grocery supply chain.
But some supermarket chains are seeing the light. For example, one
Manhattan Associates customer, Giant Eagle, employs ASNs with Manhattan’s
Warehouse and Distribution Management solutions, utilizing “put to store”
functionality for virtually all their fresh items. With those vendor supplied
ASNs, they’re not having to put away, replenish or pick it, saving a day or two
of shelf life by reducing turnaround time at the warehouse. Stores can offer
fresher produce and reduce waste from spoilage. In an environment where
consumers demand more fresh, healthy selections, even an extra day of shelf
life can make a big impact on any grocer’s bottom line.
That’s the power of the ASN—enabling flow-through/cross-dock distribu-
tion to drive efficiency from the guard shack to the store. But in order to
understand how ASNs can streamline your distribution, we need to take a
closer look at your typical supermarket DC, beginning with the guard shack
operation.
When a truck driver arrives at a typical facility, he presents someone in
the guard shack his paperwork, usually a packing slip or a manifest. That
employee goes back into the guard shack and keys in the information to
determine if this is a valid delivery and if the driver has an appointment. The
guard shack employee has to look at the paperwork, assume it’s accurate,
and decide, or call, to determine what door it should be unloaded at to get it
closer to where it’s going to be put away for receiving. This results in a line of
trailers backing up, day in, day out. Meanwhile, the clock is ticking, especially
on those fresh items.
Once the delivery has been directed to its door for unloading it will
ASNs Pick Up the Pace for Supply Chains
T
(continued on page 22)
22 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
For example, Hamburg Sud says it aims to achieve a 15 percent reduction in energy consumption from its reefer containers by 2015, with the newest reefer containers expected to save up to 20 percent in energy consumption. The box carrier says its new reefers will use inverter technology to produce cooling power only when it’s needed, making it more energy efficient and cost effective.
Meanwhile, Global Fresh Foods has begun shipping fresh salmon from Chile to the U.S. West Coast by ocean cargo, a route that was previously serviced only by air. The company’s patented fuel cell technology, Safe and Fresh Distribution (SAF-D), controls oxygen levels inside the ocean container to keep the salmon fresh during the longer transit. Ultimately, the solution provides a more cost effective transportation solution and a more sustainable alternative (no ice, polystyrene foam packaging, or carbon-intensive airfreight). Buyers, including food wholesalers and restaurant operators, have expressed interest in the service not only because of the lower freight costs, but also because it offers a dramatic reduction in the use of Styrofoam. In addition to the U.S. West Coast market, Global Fresh Foods will soon be shipping fresh salmon to Japan via ocean cargo.
Battery technology is also advancing. Last month, Emerald Tech-nology Partners and EnerDel announced they would work together to develop EnerDel’s lithium-ion battery for commercialization with Emerald’s WedWay Zero-Emission Refrigeration Power System.
The system uses kinetic energy produced by a semi-trailer’s rotating wheels to produce power, which is stored in the lithium-ion battery and used to run the refrigeration or freezer unit of the semi-trailer when it is stationary anywhere from 12 to 24 hours. It also allows for the removal of a dedicated fuel system, which reduces the weight of the semi-trailer and makes it possible to carry more cargo. ◆
C O V E R S T O R Y
need to be received. The check-in process can be labor intensive and detail
oriented. In most operations, check-in requires that quantities, lot numbers,
expiration dates and many other criteria be manually captured at the time of
receiving in order to be tracked throughout its lifecycle. This information is
then entered into the system of record and updated prior to any release of
outbound orders for fulfillment.
If you have outdated systems in your distribution operation, you may have
to receive, put away, then in many cases wait for an overnight process to
update the host systems. Distribution can’t even begin until the next day, so
already you’ve added a day to processing time within your DC. Another day to
process, pull and ship to stores and you’ve lost about two days of shelf life.
If you think you can implement flow-through in that kind of environment—
dream on.
Now, let’s imagine your grocery operation with fully optimized distribution
technology in place. Your vendor generates an ASN for your order, detailing
quantities, lot numbers, even expiration dates—giving you complete vis-
ibility of what’s on that truck headed to your DC down to the item level. And
because that ASN can drive online appointment scheduling, your system can
start prioritizing and slotting loads while that truck is still on the road.
So when that driver pulls up to your guard shack and presents that ASN,
the data is scanned and input into your system so fast he doesn’t even need
to get out the truck. You send him straight to a designated door because
you’ve already prioritized when you want to unload it and how you want to
unload it.
Granted, cross-dock is difficult to do with most palleted staples such
as canned goods. But, a pallet of bottled water? Most stores can sell that
amount fairly quickly. ASNs make that commodity an ideal candidate for
cross-dock.
The other items can be processed utilizing flow-through where the
received pallets are directed to a put-to-store area where the cases are
broken down from each pallet and store pallets are built based on the case
level allocations.
When you enable flow technology, you reduce travel in the DC. The ability
to move fresh and even seasonal items to your stores in less time can make
a huge difference to your already razor thin margins.
Another trend we are beginning to see with retailers is the requirement
of an ASN for all store level shipments both within their network and vendor
direct deliveries. This provides the ability to leverage the same advantages
for the store locations including appointment scheduling, improved visibility
and streamlined receiving. Furthermore, many companies are using this func-
tionality for store returns going back to the distribution center. This greatly
reduces the time and labor required to receive, process and disposition the
return items improving both throughput and turns.
The vast majority of vendors today have the capabilities to create detailed
ASNs. In fact, Wal-Mart and other mass retailers require it of their suppliers.
All you need to do is ask. Vendor compliance capabilities are key to Manhat-
tan Associates’ solutions. For example, our Extended Enterprise Management
(EEM) solution allows you to measure vendor performance as well as the
accuracy of their ASNs. EEM even enables you to be proactive with your
smaller vendors by providing them a secure log in to create ASNs and print
out labels for the goods they ship to you. Now you can source wherever you
want to. Even a small farm can provide ASNs for fresh local produce that can
be showcased in your stores—all they need is Internet access and a printer.
All of this can happen because of the ASN—the visibility, the paperless
operation, the flow-through—the efficiencies are tangible and the bottom line
savings are real. When you increase turns and get inventory to stores faster,
you sell more, reduce spoilage and keep your customers happy. ◆
Jeff Stout is a solutions architect for Manhattan Associates.
(continued from page 20)
ASNs Pick Up the Pace for Supply Chains
State-of-the-Art Success
Fully Automated case picking to mixed order pallets was long thought to be
impossible. WITRON forever changed this perception when it developed the
Case Order Machine (COM).
Success Story
• 400 COMs operational in 23 projects throughout the World
• Proven reliability and return on investment with evidence of 60% of
new projects generated from existing clients
• Successful implementation in Ambient, Perishable and Frozen
environments
Advantages
• Automatically pick & palletize more than 15,000 unique SKUs in one
operation
• Complete elimination of product pickfront
• New warehouse footprint reduction of up to 50%
• Transportation cost reduction of 10%
• Store aisle aligned pallet loads reduce shelf stocking time by 75%
• No product damage
• No picking errors
• No lifting 50 pound products in a 0o environment!
Tel: 847-385-6000
www.witron.com
email: [email protected]
24 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Electronic commerce is on fire. Whether it’s B2C or B2B, buyers from around the world are using com-puters and smartphones
to purchase everything from consumer goods and groceries to airplane parts and more.
The early pioneers of e-tailing and recent
entrants alike are creating new services to appeal
to consumers who demand speedy delivery, easy
returns, and an abundance of selection. Behind
the scenes, the pressure is on to figure out where
to locate distribution and fulfillment centers,
how to manage the transportation requirements,
and what kind of IT systems and software is
needed to support it all.
Amazon.com—the mother of e-comNo e-commerce conversation is complete with-
out Amazon.com. The online retailer launched
in 1995 and now dominates global e-commerce.
Amazon.com is furiously building up its infra-
structure to handle booming Internet sales.
One of its most recent additions is a 950,000
square-foot fulfillment center in San Bernardi-
no, California (just east of the Los Angeles-Long
Beach port complex), that opened in October.
According to the facility’s owners, Hillwood
Development Co. and Clarion Partners LLC,
Amazon.com is adding another 515,000 square
feet of space at a nearby facility. Together, the
facilities will serve the Central Coast region
of California all the way down to San Diego
and into southern Nevada. Aside from its close
proximity to the ports, Amazon.com’s facilities
benefit from the area’s transportation network,
including transcontinental rail links and major
airfreight hubs.
In the coming months, Amazon.com plans
to open a second, huge distribution and fulfill-
ment center in Patterson, California, located
southeast of San Francisco. The company is
already trying out its Amazon Lockers in San
Francisco, which allows consumers to pick up
merchandise at a supermarket or other store
where the lockers are installed—a highly desir-
able option for consumers who aren’t home to
accept deliveries. Amazon Lockers are also in
several other major metro areas in the U.S.,
including New York, Los Angeles, Washington,
D.C. and Seattle.
Although Amazon.com’s B2C business in
the U.S. is worth an impressive $186 billion,
the company is also making inroads in the B2B
space with AmazonSupply, which it launched a
year ago. The site offers about 600,000 SKUs
now, but Amazon.com is beefing it up to gain
a stronger position in the maintenance, repair,
and operations (MRO) segment, whose overall
sales are expected to reach $559 billion in sales
this year.
AmazonSupply’s biggest competitor is W.W.
Grainger, which boasts over 1 million parts
online and another 400,000+ in its catalogue.
In April, Grainger reported its first quarter prof-
its hit a record high. The company is expanding
its product offerings this year and focusing on
new global markets, particularly Asia and Latin
America.
Approximately 25 percent of Grainger’s
current sales are attributed to e-commerce,
although the company projects that will
grow to between 40 and 50 percent by 2015,
which is certainly achievable considering that
e-commerce is the fastest growing channel for
Grainger today. Recently, Grainger’s CEO Jim
Ryan stated that, “Over the balance of the
year, we will invest in e-commerce, our sales
force, our distribution center network and our
enterprise systems that will provide value to our
customers and help us gain additional market
share longer term.”
The online grocery warsConventional grocers have a hard enough
time battling slim margins, shorter shelf life,
food safety concerns and other challenges, so
it’s not surprising that early forays into online
grocery mostly failed.
A lot has changed over the last decade or so,
however. The online grocery segment is gaining
ground fast. Research firm IBISWorld predicts
the online grocery segment will grow 9.5 per-
E-commerce and the Supply Chain
E - C O M M E R C E
The impact is affecting sourcing, transportation, fulfillment and more. By LARA L . SOWINSKI
© iS
tock
phot
o/Th
inks
tock
If routing and scheduling drives your business - run it better with DirectRoute.
T h e p o w e r To s i m p l i f y.
Automate and optimize load and route planning for your multi-stop distribution
operations with Appian DirectRoute from TMW Systems. Your bottom line will
beneft from serious savings. Your customers will beneft from improved service.
Need more reasons why you should choose DirectRoute and what it will do for
your feet operations?
DirectRoute can help you cut:
• 10% - 20% from total driving miles • 70% - 90% from planning time • 10% - 20% from total driving hours • 10% - 25% from your operating costs • 7% - 18% from underutilized vehicles
Appian DirectrouteRouting & Scheduling Software from TMW Systems
Learn more at Appian.tmwsystems.com
800.401.6682
26 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
cent annually to become a $9.4 billion industry
by 2017.
Naturally, Amazon.com is among the field
of contenders. The company’s AmazonFresh
grocery segment is available only in the Seattle
area. However, there are persistent rumors that
Amazon.com CEO Jeff Bezos may soon rollout
the concept to one or two other densely popu-
lated urban areas, like Los Angeles.
Meanwhile, others are building their online
presence.
One of the leading online grocers in the U.S.
is Relay Foods, which started in 2009. The
Charlottesville, Virginia-based company oper-
ates in the Mid-Atlantic region and partners
with local farmers and producers to provide
fresh and locally-grown food to consumers. It
recently announced a common-stock capital
infusion of $8.25 million that the company will
use to reach new markets in Washington, D.C.,
Baltimore, and Williamsburg, Virginia. The
funds will also help speed up development of
a dedicated mobile platform and pay for Web
redesign, additional delivery vehicles, and more
food storage.
In an article on VentureBeat.com, Relay
Foods’ CEO Zach Buckner seemed undeterred
by the challenges in online grocery retailing.
“Many people consider groceries to be the Ber-
muda Triangle of e-commerce—a place where
investment dollars go but never return,” he said.
“Relay has some fairly compelling evidence to
the contrary, however. Our key metrics are cur-
rently right-side-up, so we’re cranking up our
bet, big time. We aren’t out of the woods yet,
but I think we’re poised to do to traditional gro-
ceries what Netflix did to video rental stores.”
Online grocer Peapod has been around since
1989. It’s owned by Ahold USA and is tied to
grocery chains Stop & Shop and Giant Foods.
The Illinois-based company serves 24 markets
in the states of Illinois, Wisconsin, Indiana,
Maryland, Washington, D.C., Virginia, Mas-
sachusetts, Connecticut, Rhode Island, New
Hampshire, New York, New Jersey and Penn-
sylvania. Peapod has made 23 million deliveries
since its launch.
In April, the company debuted a new Web
site, Peapodpromo.com, that offers shopping
tips and promotional offers for Peapod.
Another key player is FreshDirect, a New
York City-based online grocer that launched
in 2002. In addition to New York City, Fresh-
Direct is also in Philadelphia. The company’s
future expansion plans call for a presence in the
15 largest markets in the U.S. At the same time,
it’s in the process of moving its headquarters
from Long Island City in Queens to the Bronx,
where it will build a 200,000 square-foot green-
house and also grow vegetables on the roof.
E - C O M M E R C E
San Francisco-based Good Eggs partners with some 150 Bay Area sustainable
food producers for its direct to consumer online grocery service.
FreshDirect hopes to finish the relocation by
the end of 2015.
Unlike Peapod, FreshDirect does not work
with established grocery chains. They source
directly from a variety of meat, seafood and
produce vendors. According to the company’s
co-founders, Jason Ackerman and David McIn-
erney, this keeps the focus on freshness.
In a recent interview on Yahoo.com, McIn-
erney explained that, “Our model takes out
a lot of the distribution because we’re buying
it directly from the farm. We can take entire
truckloads from the farm into us, often pre-
selling it before it even arrives in our facility
because we take orders seven days out.”
As for what people are willing to pay for
online groceries, FreshDirect’s Ackerman
acknowledged that, “People perceive that online
is a luxury so there is a perception that prices
are more expensive.” However, “We do price
surveys for tens of thousands of products across
all competitive landscapes, and we’re quite
competitive.”
Of course, offering a good selection enhances
the online shopping experience, even if it lacks
discount pricing.
“Take a category like chickens—we try
to offer a wide range from really traditional
chickens that people see in most grocery stores,
to more of the specialty higher end,” explains
McInerney. “Whether it’s organic or antibiotic-
free or pastured chickens, we try to provide the
whole range to people so that we can hit the
entire market.”
One of the newer entrants is San Francisco-
based Good Eggs, which partners with some
150 small, sustainable food producers in the
Bay Area. The online grocer also emphasizes a
www.foodlogistics.com FOOD LOGISTICS • MAY 2013 27
Following are a few ‘small’ statistics that
indicate just how big e-commerce has
become. For instance, consider that…
• E-commerce is forecast to be worth
$1.4 trillion globally by 2015. “This has led dis-
tributors to consider more online options and how
to expand their channels to create an ‘endless
aisle’ for customers,” says Tompkins Interna-
tional’s Vince Esposito.
• In its Shape of the U.S. Industrial Recovery
Report, ProLogis expects the average indus-
trial rents across the nation to rise 25 percent
over the next four years, driven in large part by
e-commerce. Furthermore, of the new builds
going up, over one-third are build-to-suit projects
for e-commerce facilities.
• Matt McGregor with commercial real estate
firm Colliers International said about e-commerce:
“The snowball has picked up a massive amount of
speed and growth, and I don’t see anything stop-
ping it. These firms that focus strictly online are
seeing growth patterns that we’re just not used to.
We used to do 10-year lease deals for a certain
amount of space with retailers without concern,
now they’re seeing 20 percent growth per year.”
• In 2011, online grocery grew 11.6 percent
over the previous year, while in-store sales grew
only 2.5 percent, according to MyWebGrocer. On
average, the online grocery shopper spends $145
each visit.
• Brick-and-mortar retailers are also getting
into the online grocery game. Walmart’s Asda sub-
sidiary, one of the biggest grocery chains in the
UK is investing a whopping $1.07 billion to launch
new supply chain initiatives, including expansion
of its e-commerce business. Asda plans to bolster
its click-and-collect program, which allows shop-
pers to select and pay for purchases online then
pick up their order at an Asda location.
• Like Amazon.com, UPS and FedEx are intro-
ducing new pickup and delivery options for online
sales, ranging from premium, same-day services
to free, three- to five-day options to meet various
customers’ demands—and price points.
• Forrester Research says e-commerce sales
in the U.S. exceeded $200 billion in 2011 and
is expected to grow to $327 billion by 2016,
comprising nearly 9 percent of all retail sales in
the U.S.
• Who is the online grocery shopper? Accord-
ing to The Hartman Group’s 2013 report, The
Online Grocery Shopper, that person is “more
likely to be young, urban, a user of mobile tech-
nology, in a multi-person, high-income household,
and within walking distance to a grocery store,”
and represents 14 percent of U.S. households. In
addition, online shopping is helping, not hurting,
in-store shopping. “The online grocery shopper is
a high-value customer, spending more and shop-
ping more every month than those who do not use
the online channel. Retailers and manufacturers
who are able to build loyalty programs with these
behaviors in mind will be well positioned for over-
all growth.”
• In a recent study on global e-commerce,
German research firm yStats.com says mobile
commerce will attract over half a billion customers
by 2016.
The E-com Explosion
28 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
direct to consumer business model. Once an order is placed online, Good
Eggs picks and preps the order from the vendors and either delivers to the
customer’s door or makes the order available at one of its locations in the
Bay Area.
The Bay Area is also the site for Google’s online grocery pilot, Google
Shopping Express, which offers same-day delivery for food and other
products.
“We hope this will help users explore the benefits of a local, same-day
delivery service, and help us kick the tires on the new service,” said the
company during launch in late March.
Shoppers who participate in the pilot can shop from retailers such as
Target, Walgreens, Staples, American Eagle, and Toys R Us/Babies R Us,
as well as local Bay Area shops like San Francisco’s Blue Bottle Coffee, the
Bay Area’s Palo Alto Toy & Sport, and Raley’s Nob Hill Foods.
Tom Fallows, a product management director at Google who is heading
up Google Shopping Express, said the pilot will expand as “we work out
the kinks.”
Online grocery is not only taking off in the U.S., there’s plenty of activ-
ity overseas as well. Just last month, the UK’s Tesco launched Tesco Lotus in
Bangkok, Thailand. The new service offers over 20,000 grocery, fresh food
and non-food products online for home delivery. The launch is part of Tes-
co’s strategy to be an “outstanding international retailer in-store and online.”
“Tesco Lotus is committed to innovation to meet the changing needs
and lifestyles of today’s consumers. We will combine online technology
with our retail expertise to provide a great online shopping experience
for customers. With our solid infrastructure, our true understanding of
customer needs for great service and good product quality, and our profes-
sionally trained staff, we are confident that we’re offering Thailand’s best-
in-class online grocery shopping service,” remarked Tesco Lotus CEO John
Christie.
He added that, “In today’s hectic world our customers need more help
to make their lives easier—an ‘extra pair of hands’ to do the shopping for
them. Tesco Lotus is ready to do just that—have specially trained personal
shoppers to pick the best products and deliver them to customers at the
time customers choose. Product quality is also on the top of customers’
minds. So, we have invested in specially designed delivery vans that can
keep fresh, chilled and frozen products in good condition from stores to
customers’ door steps.”
Tesco started its online presence in the UK in 2000, growing to one of
the country’s busiest retail Web sites. In addition to Bangkok’s Tesco Lotus,
the company offers online grocery shopping in a number of other Asian
countries as well as emerging markets in Eastern Europe and Africa.
India’s 120 million Internet users are also looking to buy food and gro-
ceries online. The country is a hotspot for online growth, racking up 25
percent growth in e-tailing in 2012, according to the Internet and Mobile
Association of India (IAMI).
In its GAIN Report from March 25, the U.S. Department of Agricul-
ture’s Foreign Agricultural Service (FAS) states there are currently 14 online
food retailers in India.
“Most carry at least some imported food products and one sells
imported food products exclusively. Whether retailers will be able to com-
pete with the traditional neighborhood grocer remains to be seen, but the
greater selection online retailing provides could prove attractive for some
consumers,” noted the FAS.
Two of the major players in India are Mumbai’s Eemli.com, which offers
both domestic and imported fruits and vegetables, while Nature’s Basket has
physical stores in several Indian cities, in addition to its online site.
Where e-com is headingWhile e-commerce continues to grow at a blistering rate, logistics pro-
viders and others are scrambling to adapt.
In a recent blog, Steve Schwegman, senior vice president with real estate
services provider Jones Lang LaSalle, discussed just how big the impact of
e-commerce is on supply chains.
“According to the Retail Industry Leaders Association, nine out of 10
retailers still haven’t settled on their e-commerce fulfillment strategy,” he
stated, opening up “plenty of opportunity for leaders within the industry
(including consultants, third-party providers, MHE and systems integra-
tors, etc.) to create innovative solutions and value for their clients and
customers.”
At the same time, consumers are increasingly looking for free or same-
day shipping for their orders. “Same-day shipping means it will become
more important to locate inventory in closer proximity to massive popula-
tions,” Schwegman pointed out. “This could mean more e-commerce ful-
fillment DCs in large, metro areas. This could also mean less distribution
E - C O M M E R C E©
iSto
ckp
ho
to/T
hin
ksto
ck
www.foodlogistics.com FOOD LOGISTICS • MAY 2013 29
FG Products, Inc.3000 Pioneer AvenueRice Lake, WI 54868
(800) 247-3854 • (715) 234-2334www.fgproducts.com
E-mail: [email protected]
High-quality, custom molded insulated panels
have been the heart of FG Products since
1962. Experience the fit, finish and function
of a van kit done by the professionals. For
more information on the COOL-R Kits,
contact FG Products, Inc.
COOL-R Kits are superior Van Insulation Packages, Designed in Kit Form.
• Hot Shot delivery
• Home/business delivery
• Sales/demonstration vehicle
• Specialty distribution: Catering, Seafood,
Meat, Floral, Produce, Medical
COOL-R Kitsby online-only retailers in states such as Virginia, Indiana, Nevada and
Tennessee, which will begin enforcing collection of online sales tax over
the next year.”
One place e-tailers are heading is Kansas City, which has been in the
midst of a transportation and warehousing build-out, driven in part by
e-commerce.
The new BNSF Intermodal facility, set to open later this year, is a big
draw. With 443 acres under development at the complex there’s plenty
of room to handle the half a million containers that it will attract—and
there’s space to eventually handle 1.5 million containers annually.
According to the Kansas City Star newspaper, congestion and rising
costs in hubs like Chicago, Dallas, Los Angeles and Memphis means “its
Kansas City’s turn to land national companies seeking to consolidate their
logistic operations or new Internet-based firms looking for a central loca-
tion to process and ship orders.”
Indeed, over the last 10 years, “the amount of bulk warehouses in the
area, defined as buildings bigger than 200,000 square feet with at least
28-foot ceilings, has grown 47.5 percent, from 13.1 million square feet to
19.4 million square feet last year,” the newspaper reported, and will more
than double again in the coming decade. ◆
Although Amazon.com’s competitors are lining up left and right,
the company is still the darling of many Wall Street analysts.
Morningstar’s R. J. Hottovy, CFA, a director of equity analysis
with the firm, said last month about the Internet giant: “We believe
the global e-commerce industry is still very much a land grab, and we
believe the company is taking appropriate steps to keep its customers
coming back to Amazon.com.” Hottovy pointed to “Amazon’s continu-
ously improving
content library;
and two, getting
‘closer to con-
sumers’ through
recent fulfillment center investments” as activities that stood out during
the first quarter of this year.
The Morningstar analyst added that, “After more than two years of
investing heavily in fulfillment centers (which now stand at approxi-
mately 42 locations in North America exceeding 32.4 million square
feet, excluding subsidiary fulfillment centers), we believe Amazon has
the capacity necessary to facilitate the increased demand from its
active user base.”
Getting the merchandise in the customers’ hands is also part Ama-
zon’s core strength. “Delivery speed is a key competitive advantage
that Amazon holds over its bricks-and-mortar rivals, and something
that can potentially mute the impact of proposed online sales tax col-
lection legislation,” said Hottovy. “We believe the benefits of expedited
shipping will become more apparent over the next several periods.
We also believe a wide-reaching fulfillment center network will help to
facilitate new growth avenues such as AmazonSupply (whose end cus-
tomers often require expedited shipping due to the specialized nature
of the products) as well as AmazonFresh.”
ALL THINGS
Amazon.com
Now that the global economy is on the rebound, construc-tion and expansion of refrigerated warehouses in the U.S. and abroad is picking up to stay ahead of grow-ing demand. A number of high-profile projects offer a glimpse into who’s expanding where and how these state-
of-the-art facilities are supporting the cold chain.
Activity in the PRW sector
In the public refrigerated warehouse (PRW) sector, several key proj-ects have recently come online or are near completion. In Dallas, US Cold Storage is close to wrapping up construction on a new 500,000 square-foot facility. The company purchased the site in 2007, but delayed construction because of the recession.
US Cold Storage already runs a facility in Dallas, but it’s been operating at maximum capacity for the past few years, according to the company’s Dallas general manager. The new facility features six 42-pallet blast cells, a temperature-con-trolled dock with 21 doors, and rail accessibility.
It’s also highly energy efficient. A CO2 cascade refrigeration system will use hot gas defrost, instead of electric defrost, allowing the system to operate at opti-mum efficiency.
Boosting energy efficiency is key for cold storage opera-tors, and was a determining factor behind a partnership between Lineage Logistics and Cascade Energy, which aims to lower resource utili-zation and costs for Lineage by 10 to 15 percent.
Cascade Energy’s CEO Marcus Wilcox explained that, “Lineage is taking both an aggressive and compre-hensive approach to energy management.” Acknowledg-ing the high energy costs associated with running a cold storage facility, he
30 JANUARY/FEBRUARY 2013 • FOOD LOGISTICS www.foodlogistics.com30 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Post-recession expansion of the refrigerated warehouse network shows no sign of cooling down. B y L A R A L . S O W I N S K I
The Big Thaw in Cold Chain Storage
P R W U P D A T E
2013 IARW Top 25 North American Public Refrigerated Warehousing CompaniesCompany Headquarters In Capacity
(cubic feet)
Capacity
(cubic meters)
Americold Logistics Atlanta, Georgia 873,969,537 24,748,021
Lineage Logistics Colton, California 289,976,853 8,211,217
Millard Omaha, Nebraska 279,571,738 7,916,577
Preferred Freezer Services Chatham, New Jersey 235,100,269 6,657,287
United States Cold Storage, Inc. Voorhees, New Jersey 198,595,682 5,623,594
VersaCold Vancouver, British Columbia, Canada 117,331,544 3,322,454
Interstate Warehousing, Inc. Fort Wayne, Indiana 90,285,937 2,556,609
Cloverleaf Cold Storage Co. Sioux City, Iowa 67,898,876 1,922,679
Burris Logistics Milford, Deleware 63,679,576 1,803,202
Nordic Logistics and Warehousing, LLC Atlanta, Georgia 59,529,000 1,685,671
Columbia Colstor, Inc. Moses Lake, Washington 50,610,000 1,433,113
Congebec Logistics, Inc. Quebec City, Quebec, Canada 48,380,000 1,369,967
Frialsa Frigorificos S.A. De C.V. Tlalnepantla, Edo de Mexico, Mexico 45,538,850 1,289,515
Henningsen Cold Storage Co. Hillsboro, Oregon 42,589,635 1,206,002
Hanson Logistics St. Joseph, Michigan 35,178,539 996,144
Conestoga Cold Storage Kitchener, Ontario, Canada 33,762,000 956,032
Trenton Cold Storage, Inc. Trenton, Ontario, Canada 28,335,972 802,384
Confederation Freezers Brampton, Ontario, Canada 26,450,000 748,979
Zero Mountain, Inc. Fort Smith, Arkansas 23,644,000 669,522
Interstate Cold Storage, Inc. Fort Wayne, Indiana 21,403,000 606,064
Allied Frozen Storage, Inc. Brockport, New York 21,246,747 601,640
Hall’s Warehouse Corp. South Plainfield, New Jersey 20,625,304 584,043
Nor-Am Cold Storage, Inc. LeMars, Iowa 18,042,000 510,892
U.S. Growers Cold Storage, Inc. Los Angeles, California 16,365,356 463,415
Trans Continental Cold Storage Company Dakota Dunes, South Dakota 16,000,000 453,069
2013 TOTAL 2,724,110,415 77,138,092
32 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
added that Cascade is working with Lineage “shoulder-to-shoulder” to “strategically con-trol utilization and costs that are second only to labor in the industry.”
Central to Cascade’s approach to reducing its clients’ energy costs is the facility “tune up,” which identifies opportunities for energy savings through proper maintenance and operations, all of which is captured by Cas-cade’s proprietary energy tracking software and efficiency platform called SENSEI.
According to Cascade, the company has saved its industrial clients approximately $125 million, and two billion kilowatt hours per year with its energy savings solutions.
To date, Cascade has completed more than 3,000 projects across a variety of industries, including cold storage, foodservice distribu-tion, food processing, agribusiness, oil and gas, pulp and paper, and general manufactur-ing.
Meanwhile, Lineage Logistics has been steadily building out its network. Most recently, it acquired Seattle Cold Storage (SCS) and its business in Algona, Washing-ton and the Port of Tacoma. Between the two locations, SCS has 420,000 square feet with services ranging from temperature-controlled storage, to import/export, retail distribution, and transportation services.
Bill Hendrickson, Lineage CEO, said the acquisition of SCS “complements our exist-ing Seafreeze and CityIce operations in Seat-tle and enables us to provide our customers with unparalleled service and supply chain capabilities in the Puget Sound. Our Lin-eage Freight Management division has also expanded its market leading transportation-freight consolidation solutions to these new locations.”
In the meantime, Lineage really boosted its network last July when it acquired Cali-fornia-based Castle & Cooke Cold Storage (CCCS), positioning itself as the third-largest refrigerated warehouse company in North
America. The acquisition of CCCS
included 24 facilities totaling 112 million cubic feet located across California, Illinois, Maryland, Mis-souri, Georgia and Texas.
Foreign trade adding to demand
An increase in U.S. imports and exports is also adding to demand for cold storage. Although Port-land, Maine has been without direct ocean container service to Europe for 33 years, that changed in late March when Iceland’s liner company Eimskip added the city as a port of call—the only U.S. city currently served by Eimskip.
The liner’s expertise in ship-ping frozen seafood is a boon for the region’s seafood companies. However, it’s causing some to ques-tion whether Portland has the cold storage capacity to support the new traffic (Eimskip estimates it will move 5,000 containers through Portland annually with the new service).
Right now, the port has only one cold storage facility, a 1.7 mil-lion cubic-foot warehouse operated by Americold Logistics. Most sea-food companies in New England use cold storage providers in the Boston area. There are reports that Americold will invest in its Port-land-based cold storage operations, but no details are available yet.
Meanwhile, there are other developments in the works result-ing from the new Eimskip service. For one, the Maine Port Authority is installing 150 reefer container
2013 IARW Top 25 Global Public Refrigerated Warehousing CompaniesCompany Locations In Capacity
(cubic feet)
Capacity
(cubic meters)
Americold Logistics and China
Merchants Americold
Argentina, Australia, China,
New Zealand, United States
958,449,139 27,140,213
Lineage Logistics United States 289,976,853 8,211,217
Swire Cold Chain Logistics (Langfang)
Ltd., Swire Cold Chain Logistics (Shang-
hai) Ltd., Swire Cold Storage, Finlay
Cold Storage (Pvt.) Ltd., Swire Cold
Storage Vietnam, Swire Pacific Cold
Storage Company. Ltd., United States
Cold Storage
Australia, China, Sri Lanka,
United States, Vietnam
289,937,626 8,210,106
Millard United States 279,571,738 7,916,577
Preferred Freezer Services China, United States, Vietnam 235,100,269 6,657,287
Nichirei Logistics Group, Inc., Eurofrigo,
Frigo Logistics, HIWA Rotterdam Port
Cold Stores
Japan, Netherlands, Poland 152,406,799 4,315,673
Kloosterboer Canada, France, the Nether-
lands, United States
119,188,125 3,375,026
VersaCold Canada 117,331,544 3,322,454
Partner Logistics Netherlands 101,021,075 2,860,594
Interstate Warehousing, Inc. United States 90,285,937 2,556,609
Cloverleaf Cold Storage Co. United States 67,898,876 1,922,679
Burris Logistics United States 63,679,576 1,803,202
MUK Logistik GmbH Germany 60,758,989 1,720,500
Nordic Logistics and Warehousing, LLC United States 59,529,000 1,685,671
Gruppo Marconi Logistica Integrata Italy 55,090,931 1,559,999
Columbia Colstor, Inc. United States 50,610,000 1,433,113
Congebec Logistics, Inc. Canada 48,380,000 1,369,967
Frialsa Frigorificos S.A. De C.V. Mexico 45,538,850 1,289,515
Bring Frigoscandia Sweden 42,847,343 1,213,300
Henningsen Cold Storage Co. United States 42,589,635 1,206,002
Hanson Logistics United States 35,178,539 996,144
Oxford Logistics Group Australia 34,943,549 989,489
Conestoga Cold Storage Canada 33,762,000 956,032
Trenton Cold Storage, Inc. Canada 28,335,972 802,384
Confederation Freezers Canada 26,450,000 748,979
2013 TOTAL 3,328,862,365 94,262,732
P R W U P D A T E
plugs at the port terminal to power the reefers discharged from the Eimskip vessels. In addi-tion, a Maine-based lobster company says it may export some of its Europe-bound prod-uct out of Maine instead of trucking it down to Boston now that more cold chain services and shipping are available in Portland. Other cold storage operators are watching the lat-est developments too, but say they won’t commit to adding any cold storage capacity to Portland unless more business starts to materialize.
Foreign trade is also driving cold storage construction in the U.S. Southeast. Last month, the Georgia Ports Authority cel-ebrated the grand opening of Nordic Cold Storage’s new facility near the Port of Savan-nah. The facility features more than 200,000 square feet of convertible temperature-con-trolled storage space and is capable of blasting more than 10 million pounds of product, ranging from fresh poultry to produce, per week. Nordic plans to start on a second phase of the facility by the end of the year.
The new facility is a win for the state’s poultry producers, according to Curtis Foltz, Georgia Ports Authority’s executive director.
“The Port of Savannah handles nearly 40 percent of the nation’s containerized poultry exports, supplied largely by Georgia’s farms. Quality providers like Nordic will give ship-pers more cost effective options for moving refrigerated commodities to and from inter-national markets,” he remarked.
Reefer business is central to the Port of Savannah’s cargo mix. In 2012, the port’s refrigerated cargo exports grew 3.9 percent to nearly 108,000 TEUs. Over the last seven years, refrigerated cargo exports through Savannah have risen 130 percent.
The Georgia Ports Authority says that more than 80 cold storage facilities around the state rely on the Port of Savannah, with a combined storage capacity greater than 16 million square feet.
“These private investments help to grow Savannah’s market reach, to attract a greater base of cold storage commodities, and to make Savannah a hub for refrigerated cargo,” noted Cliff Pyron, Georgia Ports Authority’s chief commercial officer.
In neighboring South Carolina, Millard Refrigerated Services is breaking ground on a new cold storage facility in Charleston Coun-
ty that will begin operating in 2014. “The team at Millard is excited about
the business opportunities with our new operation in Charleston County. The facil-ity will give us access to the world class port in Charleston and provide an efficient hub for our customers along the East Coast and throughout the Southeast,” said Lance Lar-son, the company’s president and CEO.
Millard’s new cold storage facility will be used to freeze and store poultry, pork and beef products that will be exported to foreign markets.
South Carolina’s Secretary of Commerce Bobby Hitt added that, “Distribution and logistics companies are increasingly coming to understand that South Carolina is just right for their operations. Being centrally located between Miami and New York City, having solid infrastructure and one of the busiest ports on the East Coast makes the Palmetto State ideal for reaching customers and mar-kets.”
South Carolina’s exports last year rose more than 21 percent to $24.6 billion worth of goods sold to 198 countries around the world. ◆
automation.ssi-schaefer.us/matrix(877) 724-2327 automation.ssi-schaefer.us/matrix(877) 724-2327
SECTOR REPORTS WAREHOUSING: PALLETS AND PACKAGING
Sustainable Pallets, Packages & MoreGreen products are better for the earth and better for the bottom dollar. By Lauren Levy
34 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Sustainable pallets, packaging and
containers offer many advantages
within the supply chain. Compa-
nies are offering green products
that provide durability while
reducing overall costs, decrease possibil-
ity of cross-contamination, offer better
protection while transporting goods, and
increase overall efficiency. Sustainability is
ultimately more than plastic vs. wood pal-
lets, as both offer solutions that help meet
environmental goals.
Often, companies initiate a move toward
green products because the consuming public
has demanded it. Once a company makes the
decision to ‘go green’ they will set goals and
design a program based around sustainable
practices. However, sustainability does not
necessarily mean adding costs. In fact, more
companies are realizing that ‘going green’
not only produces a better product, but also
allows for a greater return on investment.
What ‘going green’ has to offerCompanies now more than ever are aware
of their environmental impact and are mak-
ing an effort to reduce waste, improve saving
and increase overall efficiency. IPC, iGPS,
CHEP, ORBIS and Rehrig have all concen-
trated their focus on sustainable pallets and
packages.
Insulated Products Corp (IPC) made the
decision to focus on a green product because
“the consumer demanded it,” said Charles
Veiseh, president of IPC. IPC special-
izes in cold/frozen pallets and cartons.
IPC took advantage of that market
niche and created a product that,
according to Veiseh, is more effective
at temperature control yet doesn’t use
the more conventional polystyrene.
Polystyrene is not an environmentally
friendly product. Polystyrene is made
from petroleum, is non-renewable and is not
biodegradable. Moreover, it is inflexible when
it comes to managing storage.
IPC’s temperature control bag uses a
reflective foil that keeps products cool using
an
insulated
liner, whereas
polystyrene is “strictly
a heat insulator.” IPC’s
main products, the GreenLiner
and CooLiner, are green, affordable and
offer an alternative to traditional polystyrene.
IPC uses soft panel to insulate their bags
so they are easier to ship and store. Further-
more, after the CooLiner has fulfilled its use,
it can then be turned into secondary packag-
ing and become “recycled lumber or food
trays,” adds Veiseh.
IPC has high hopes for their company
in terms of cold sensitive freight. They are
optimistic that their CooLiner Pallet Covers
will be used in conjunction with dry trucking
as a means to eliminate the “more expensive
refrigerated shipping in its entirety” and
“potentially result in tens of thousand[s] of
dollars saved in shipping costs,” says Veiseh,
who points out that dry trucks are consider-
ably more fuel efficient and ‘greener’ than
refrigerated trucks.
Rehrig, unlike IPC, doesn’t solely market
itself as a ‘green’ product. Nonetheless, it is a
sustainable and ecofriendly product. Rehrig
admits that much of the driving force behind
its sustainable development of pallets and
containers is creating solutions that maximize
customers’ return on investment.
According to Van Nguyen of Artime (the
firm responsible for Rehrig’s marketing), the
true green attributes of Rehrig’s products are
in how the pallets are used. For example,
Rehrig’s products increase sustainability
by aiding in the reduction of spoilage and
shrink. They eliminate “the burden placed on
the environment by one-way packaging and
pallets; and reducing the number of trucks
on the road all while helping to increase
product safety,” explains Nguyen.
Rehrig, apart from maximizing ROI, has
invested time developing a “more durable
design, by minimizing wasted diesel
fuel and space in the truck, and by
meeting GMA Block Pallet perfor-
mance with a sub 50-lb plastic pallet
that is exactly 48x40x5.6 inches over
the course of its entire life.”
Rehrig also uses the latest in
polyolefin resins to ensure durabil-
ity. “Rehrig will collaborate with
the leading resin and additive manufactures
to develop specific grades for a [particular]
application. And if discussed, that application
can be made of 100 percent composted recy-ORBIS FliPak® is durable, reusable and
fully recyclable.
iGPS uses RFID-tagging to trace the
location of each unitized product load
through the supply chain.
ORBIS integrates with your supply chain to implement
your reusable plastic pallet program.
With more than 35 global manufacturing, sales and service locations,
ORBIS has the resources and insight to support you every step of the
way. That means improved efciency, decreased environmental
impacts and reduced trip costs. ORBIS helps leading companies:
>> Compare reusable and single-use pallets
>> Evaluate ROI and cost-per-trip
>> Calculate energy, waste and emission impacts
>> Optimize supply chain performance
>> Standardize shipments
>> Improve plant cleanliness
It’s a revolutionary shift in thinking.
And it’s only available from ORBIS.
A shift in thinking leads to a place
where planet and proft coexist.
To learn more, please call 888-217-0965 or
visit www.orbiscorporation.com.
36 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
1-800-628-4065
w w w.loadtransfer.net
Keep contamination out of your production area by using a Columbia Load Transfer Station
Are youFSMA compliant?
Transfers from one pallet type to another
Category 3 safety compliant
Safer, cleaner and faster than load inverters
Prevents wood pallets and contamination from entering production areas
>
>
>
Become our fan columbiamachineinc
Follow us on twitter@colmac_inc
clable polyethylene or polypropylene. Addi-
tives like a specific color or fire retardants are
“non-halogenated, non-toxic and also 100
percent recyclable.”
Many green and sustainable solutions often
coincide with ways to fix fiscal and logistical
problems. Companies want to save money
and pass those savings on to the consumer
through an ecologically sound product.
ORBIS’ Life Cycle Assessment Tool, which
helps generates quantifiable, measurable sus-
tainability data, is one such example.
ORBIS manufactures reusable plastic
containers and pallets that improve and assist
workflow along the supply chain. Each plastic
container can be fully recycled after it has
fulfilled its use. ORBIS also calculates solid
waste, greenhouse gas emissions and energy
usage that impact their packaging. They are
also able to minimize their carbon footprint
by fully understanding and calculating their
environmental output.
One unique aspect to ORBIS is that they
have created a program to calculate and make
sustainable decisions based on quantifiable
environmental data. ORBIS’ Life Cycle
Assessment Tool provides quantifiable data,
which will detail a company’s environmental
impact. Heather Markovich, public rela-
tions executive with ORBIS, mentions that
engineering teams compile this data and the
outcome will examine “carbon emissions,
energy, and solid waste generated on a relative
basis from their data and assumptions, and
the opportunities for improvement.”
Another feature of ORBIS’ pallets is that
they are hygienic. Their plastic pallets are
non-porous and can be easily cleaned and
disinfected. They have an open-deck flow
through design, which minimizes areas “for
contaminants to collect” and makes clean-
ing easier and supports sanitary conditions
throughout the food supplycchain.
CHEP is another company that incor-
porates sustainable practices in developing
and maintaining their wooden pallets. David
Deal, senior director of marketing, is aware
that “retailers frequently instruct their buyers
to give preference to suppliers that use prod-
ucts made of renewable resources.” The use
of renewable wood is part of their sustainable
strategy.
Deal states that a benefit to wooden pallets
is that repair is much simpler than in plastic
pallets. “The right kind of wooden pallet
enables repair of a single component that
may become damaged rather than require an
entire pallet to become scrapped when dam-
aged.” The wood used as a replacement can
come from reclaimed sources, further enhanc-
ing the sustainability aspect.
CHEP controls “the sourcing of all its
lumber and has the publically stated goal of
sourcing 100 percent of lumber from certi-
fied sources by 2015. In addition, CHEP
uses a heat-treatment process for pallets that
is required to meet international ISPM 15
standards, rather than the chemical treatment
alternative,” adds Deal.
On a corporate level, CHEP uses a Life
Cycle analysis as part of its sustainability pro-
gram. This analysis calculates the total envi-
ronmental impact CHEP actually produces
on a yearly basis. This study is conducted by
a third party—Franklin Associates—which
looks at various elements that impact the
environment, such as solid waste, total energy
usage, and greenhouse gas emissions, to
help CHEP make more informed decisions
around sustainability.
Innovation and sustainability go hand
in hand in maximizing product efficiency.
Lewis Taffer from iGPS says that Intelligent
Global Pooling System’s pallet fits into this
category. The iGPS system is 100 percent
recyclable. According to Taffer, “It’s the
highest form of sustainability, called ‘cradle-
to-cradle.’ Contrast this with wood pallets,
which require a constant cycle of felling
trees and landfilling broken pallets.”
iGPS is one of the sustainable leaders in
their business segment and on the vanguard
of innovation and sustainable design. The
company describes itself as the world’s “first
and only pallet rental service to provide light-
weight platforms with embedded RFID tech-
nology for tracking shipments.” These pallets
have been adapted by some of the country’s
most ecologically friendly companies and
because they are 35 percent lighter than tradi-
tional wood pallets, they also lighten a truck’s
load. This lighter pallet can add up to a total
reduction of between 500 to 2,200 lbs. per
truckload compared to traditional wooden
pallets, which in turn reduces fuel burn and
greenhouse gas emissions.
Companies moving toward sustainable
practices are definitely seeing a return on
their investment, reduction in overall costs
and increased efficiency. Whether plastic or
wood pallets, the decision to ‘going green’ is
well worth the effort. ◆
IPC’s GreenLiner provides high performance
box insulation for cold chain shipping.
A FAMILY TRADITION OF GROWTH, SERVICE AND INNOVATION
Phone: (800) 546-4993
Email: [email protected]
Web: www.rehrigpacific.com
Rack it. Track it. Reuse it.
The New Rehrig GMA-228
100% Sustainable Packaging • Supply Chain Integration • Complete Logistics Services • Enhanced Tracking Capabilities
Minimum 5-Yr Life CycleRackable to 2,800 Lbs.
GPS & RFID Trackable
A rackable pallet with measurable ROI• Lower Your Cost Per Trip
• Gain Sustainability Scorecard Improvements
• Increase Your Yield and Reduce Shrink
• Reduce Operational and Packaging Costs
• Meet New FSMA Traceability Standards
SECTOR REPORTS TRANSPORTAT ION: LIQUID BULK
38 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Richard Lloyd, global manufactur-
ing director for Accolade Wines,
was quoted as saying, “We don’t
ship glass around the world, we
ship wine.” Liquid bulk capabili-
ties are truly transforming logistics
networks for wine, juice concentrate, water
and even paints. Te efect, particularly in
the feld of bulk wine transport, has dealt
repercussions both positive and negative for
both consumers and suppliers.
For starters, liquid bulk transport saves
money. Rabobank estimated that bulk
shipping yielded an annual savings of
$142,300,000 in 2010 when compared with
2001 bulk shipments. That’s a savings of
$2.25 for a standard 9-liter case of wine.
Ocean transport charges are typically
based on volume, therefore it’s in a shipper’s
best interest to use the maximum amount
of space available. One-third of an ocean
container’s space is “lost” when filled with
bottled wine. By comparison, Bloomberg’s
David Fickling notes that, “While a 20-foot
container accommodates about 9,000 liters
of bottled wine, a bladder holds 24,000 liters
and costs only a little more to transport.” The
mass also helps keep wine cooler during the
voyage and reduces the need for refrigeration,
which can contribute to the overall savings by
up to $5,000, according to Ben Mislov, sales
manager JF Hillebrand Group AG.
An equally big advantage to shipping liquid
bulk is the environmental benefit. There is a
large carbon footprint when it comes to ship-
ping in general. In fact, “The carbon footprint
of alcohol consumed in the UK is 1.5 percent
of the total UK greenhouse gas emissions,
which one-quarter is attributable to wine,”
reports The Horse’s Mouth. The development
and use of the flexitank is one way to reduce
carbon emissions from wine shipments.
Shipping liquids by bulk does have a
drawback, however, the largest being job
loss. Because the wine is no longer bottled
before shipment, factory workers previously
employed at bottling plants or glass factories
are losing their jobs. South Africa is a prime
example of job loss due to increasing liquid
bulk transport.
The wine industry in South Africa played
a major economic role in building the post-
apartheid nation. The weather, land and
resources make the country perfect for grow-
ing and bottling wine. In 1994, there were
275,000 people employed either directly or
indirectly in the wine industry. By 2000,
those numbers had fallen to 160,000.
Meanwhile, Thomson Reuters reported
that in January 2011, “bulk [wine] exports
overtook bottled shipments in South Africa
for the first time.” This was a major turning
point for the industry, and triggered many
The Logistics of Liquid BulkWine shippers see a value proposition that’s hard to beat. By Lauren Levy
Whether by rail, truck or ocean container, liquid bulk shipments are a cost effective way to transport beverages like juice and wine.
Even high-end wine shippers are moving more product by bulk now that flexitank technology and better monitoring is available.
© C
om
sto
ck/T
hin
ksto
ck.c
om
layoffs. Leo Burger, Rostberg Winery’s general
manager, said, “The only way we can cre-
ate more jobs is if we could bottle our wine
locally.” The South African government was
so incensed they threatened retaliation against
the UK, the largest importers of wine, saying
they would import bulk whiskey from Great
Britain and bottle it in South Africa.
Wine contained in every four out of five
bottles in the UK’s stores has been shipped
in bulk. In the U.S., it’s two out of every
five bottles. Furthermore, many brands have
begun using liquid bulk transport as a way to
remain competitive.
Bulk wine imports are on the rise and
the future forecast is for more of the same.
Shipping in liquid bulk for the producer
is one of the most compelling ways to stay
competitive in the market place. Job loss is an
unfortunate consequence that will have to be
acknowledged and managed before it is too
late. Yet, liquid bulk shipments will continue
to reshape transportation and logistics by
cutting costs, maximizing cargo space and
providing a more ecologically sound way to
transport liquids. ◆
1Data as of 3/31/13 2 Fiscal Year 2011 – 2012 ® denotes a registered trademark of Alliance Shippers Inc.
“The Business of America is Business.”— Calvin Coolidge
The Business of Alliance Shippers Inc. is . . . “To Manage Our Customers’ Business.”
ThePerfect Shipment®
Our Commitment To You.
®
For more information about all of our services, visit us at:
www.alliance.com
Perfect Shipment® Performance1
On-Time Pick-Up = 98.9% On-Time Delivery = 98.4% YTD On-Time Delivery = 98.1%
Damage-Free Performance 2
Refrigerated Services = 99.49% Dry Van Intermodal and Highway Services = 99.65%
®
Rail Makes Tracks into the Wine Biz
BY LARA L . SOWINSK I
In the U.S., most bottled wine is still transported by truck. However, in recent years the rising
cost of fuel coupled with advancements in insulated railcars and temperature-control technol-
ogy has resulted in more wine moving via rail.
Not only are shipping costs less for a coast-to-coast rail move compared to truck, a railcar
can hold more than three times the number of wine cases (4,300-5,000 versus about 1,235 in
a typical 53-foot truck trailer). Fuel costs are substantially lower for rail too, and greenhouse gas
emissions are dramatically reduced.
Trucks beat rail on transit time, of course, but better planning on the shippers’ part can cover
the extra days it takes to move wine by rail in many instances. However, for smaller shippers or
expedited shipments, transportation and logistics companies like Alliance Shippers offer specialty
services for wine shippers. Alliance can ship one or multiple pallets anywhere in North America,
the Caribbean and most international destinations. The company also offers temperature-controlled
shipping and warehousing for wine and spirits and has been recognized by Diageo, the world’s larg-
est distributor of wine and spirits, for its shipping expertise.
In the meantime, rail carriers continue to growth their market share for wine transport. Last
month, Railex opened a $20 million warehouse and distribution center in Wallula, Washington
targeting regional winemakers who ship their wine throughout the U.S. The temperature- and
humidity-controlled facility can store up to five million cases of wine.
Ste. Michelle Wine Estates is the anchor company for the new Railex facility. This year, Ste.
Michelle will ship about 8 million cases of wine and Railex will handle over 6 million of those cases.
Railex also has facilities in California and New York, and plans to open its next one in Jackson-
ville, Florida.
SECTOR REPORTS SOFTWARE & TECHNOLOGY: LOAD PLANNING
40 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Most outbound warehouse opera-
tions routinely execute two
independent processes: selec-
tion and loading, with staging
in the middle. Selectors pick
cases onto pallets (or carts, or other con-
tainers) and stage product on the dock.
Later, a smaller number of loaders move
product from the dock into the trailer.
Product staging before loading is generally
used as a defensive measure, or buffer. Work
can be assigned in advance, with minimal risk
of falling behind and risking late dispatches.
For all its convenience, staging has several
drawbacks, including:
• Stagedproductrequiressubstantialdock
space;
• Temperature-sensitiveproductsareat
risk; and
• Double-handlingofpalletsbyboth
selectors and loaders adds labor time and can
cause errors and damage.
However, warehouse managers are seeking
ways to compress their response times and
reduce their labor costs. Like many supply
chain efficiency strategies, bypassing staging
by loading products directly onto trailers after
selection aims to:
• Limitthenumberoftouchpointsfor
each item in the chain; and
• Executeeachstepjustwhenneeded,
butnotbefore(ajust-in-timestrategy).
Up-front load planning Tomorefullyintegrateselectionandload-
ing processes, each outbound trailer must
have a good load plan with a pallet assign-
ment for every case, and trailer position
designated for every pallet. Load plans may
incorporate compartment assignments, axle
weightlimitations,deliverysequence,product
stacking and mixing rules, and so on. Plan-
ning should be as automated as possible. Let-
ting loaders plan as they load by rebuilding
pallets on the loading dock is both inefficient
and costly.
Direct loading A successful direct load-
ing strategy demands a robust
“command and control” system
with three essential compo-
nents:
Visibility.Thedirectloading
system must have in view the
loads to be built (load plans),
the dispatch schedule, and the
labor pool assigned to carry
out the work. A robust system
will even learn from the experi-
ence of assigned employees, for
instance, automatically recog-
nizing that a new hire will take
longer to execute a task than a
seasonedveteran.Tomakeit
through the dispatch peak in a
just-in-timeenvironmentcalls
for flexibility in labor schedul-
ing, perhaps by overlapping
shift schedules.
Parallel Processing. Robust
task and labor planning logic
is needed that factors in ware-
house rules and work standards. Planned start
and stop times for every task and any task
dependencies must be mapped in a timeline.
Toavoidstaging,someselectiontasksmust
be delayed to wait for available loading doors
andequipment.Multipleloadsarethen
selected and loaded simultaneously by multi-
pleemployees.Thesystemsinvolved—WMS,
load planning, labor planning, task manage-
ment—shouldbetightlyintegrated.
Dynamic Task Management. A direct
loading system must be able to monitor the
progress of all work tasks as they are executed
by employees and dynamically assign tasks
minute-by-minute (if not second-by-second).
Work dependent on tasks completed late
must be carefully accelerated when cleared to
start. Work dependent on tasks completed
early must be held back to allow other more
critical tasks to take priority. Furthermore,
voice is an ideal technology to enable real-
time communication with employees in a
just-in-timeenvironment.
Thestagingprocesshasexistedforalong
time. It provides a comfortable means of
managing a labor pool, especially when man-
ual systems are included in the mix. However,
moving in the direction of direct loading
may offer a reduction in the lead time for
outbound processes, and a corresponding cost
reduction.Suchatrendwillrequirereal-time
execution systems having the advanced plan-
ning logic necessary to build parallel tasks
and labor plans, and the dynamic visibility to
implement timely course corrections. ◆
Matthew D. Bent is the president of Syntelic
Solutions Corporation, a Food Logistics’
FL100 technology provider located in
Germantown, Maryland.
Can We Apply Just-in-Time Thinking to the Outbound Problem?Advanced load planning reduces lead time and lowers labor costs. By Matthew D. Bent
Robust load planning software helps free up dock
space and make better use of labor.
© P
ure
sto
ck/T
hin
ksto
ck.c
om
www.foodlogistics.com FOOD LOGISTICS • MAY 2013 41
MARKETPLACE
MA
RK
ET
PL
AC
EOnline Freight Management
Equipment for Sale
Routing Software
Software Tools For:
✔ Routing and scheduling Multi-Stop Routes
✔ Truckload Routing and Lane Matching
✔ Fleet Sizing and Resource Scheduling
✔ Paratransit Routing and Scheduling
Truck Routing Software
Phone: 1.855.472.7236
[email protected] • www.paradoxsci.com
Download Your
Free 14 Day Trial at
www.paradoxsci.com
Why Truck Routing Software?
• Fewer Miles
• Better Asset Utilization
• Faster Planning and Response
• Better Customer Service
Why Choose Us?
• Over 15 Years Track Record
• Software by License or Subscription
• Free 14-Day Trial
• Same Exceptional Support to Every
Customer
S O F T W A R E C O N S U L T I N G
WABASH SELLS & RENTSBOILERS & DIESEL GENERATORS
FAST EMERGENCY SERVICE! 800-704-2002www.wabashpower.com
wabash POWER EQUIPMENT CO.
FAX: 847-541-1279
847-541-5600
444 Carpenter Avenue, Wheeling, IL 60090
ADVERTISER INDEX
ADVERTISER PAGE
Alliance Shippers, Inc.. .................................................... 39
C.H. Robinson Worldwide, Inc .......................................... 9
Columbia ......................................................................... 36
Crowley ........................................................................... 21
Dematic ............................................................................. 5
FG Products, Inc. ............................................................ 29
Food Logistics ................................................................. 43
Ford Motor Company .............................................Cov 2, 3
Great Dane Trailers .....................................................Cov 4
H & M Bay, Inc. ............................................... .................22
Intelligrated ...................................................................... 11
Johnson Refrigerated Truck Bodies .................................. 7
Lineage Logistics ............................................................ 17
Orbis ................................................................................ 35
ProCat Management Services......................................... 13
Rehrig Pacific Company .................................................. 37
Safeway Management Group .......................................... 20
Schaefer Systems International, Inc. ............................... 33
Superior Tire & Rubber Corp. .......................................... 28
TMW Systems, Inc. ......................................................... 25
United States Cold Storage ............................................ 31
Utility Trailers ................................................................... 15
Westfalia Technologies, Inc ............................................. 27
Witron .............................................................................. 23
B Y M I K E R O Z E M B A J G I E RFOOD (and More) FOR THOUGHT
42 MAY 2013 • FOOD LOGISTICS www.foodlogistics.com
Each year, the Centers for Disease Control and Prevention
(CDC) estimates 31 different pathogens cause 9.4 million
foodborne illnesses in the U.S. In addition, the problem
is on the rise: According to the most recent data available
from the CDC, hundreds more consumers become ill from
foodborne illnesses every year.
Foodborne illnesses attract the attention of media and regulators;
each month, there are hundreds of articles about outbreaks of ill-
ness in online and traditional newspapers, with the largest outbreaks
discussed on national news shows. In response to the threat to public
health, the federal government has enacted the Food Safety Mod-
ernization Act (FSMA), which shifts the focus from reacting to a
situation to prevention, with additional scrutiny and accountability
on companies. As a result, food manufacturers find themselves in an
operating environment where just one negative incident can quickly
attract a lot of attention to their brand.
With the threat of foodborne illness increasing, it’s not a matter
of if your company faces a food recall—it’s when a recall will occur.
More than ever, food manufacturers need to consider how recalls will
impact their supply chains and plan in advance. While most compa-
nies have a crisis scenario plan in place, there are important issues to
consider in order to navigate today’s unique business environment:
• Know your supply chain inside and out. Time and time again,
when a recall strikes, companies realize that their knowledge of who
sells their products is just as critical as tracking their own supply chain
data. By improving food traceability through new technologies, better
recordkeeping and increased data requirements, food companies can
better visualize supply chains during a foodborne illness outbreak and
more quickly determine the source of the problem. The ability to track
source ingredients and final products can help reduce the size and span
of any recall, as well as help determine who will be most affected.
• Ensure speed in a time of crisis. The
impact of foodborne infections on your
consumers happens at a rapid pace. Once
the public is made aware of the presence of a
pathogen, regular communication with con-
sumers is vital to help people protect them-
selves. In addition, a quick response from
a company can help minimize reputational
damage and keep your brand as safe as pos-
sible.
• Have a recall plan in place that is prepared
for a high volume of consumer inquiries. Developing a recall plan in
advance can save time, energy and money. Often, companies don’t
realize that they will need to be prepared to handle a high number of
hits to the company Web site, as well as a high influx of calls from
concerned customers. Given this surge of inquiries, you must have a
plan in place to have the right number of well-trained representatives
to handle questions by phone, as well as enough bandwidth to keep
your Web sites and servers running.
• Test your recall plan frequently and completely. A mock recall is
impactful, as it allows your team to test its recall preparedness first
hand. Because food traceability is such a critical issue, it’s crucial for
you to have good relationships with your food supply chain partners.
Recall planning and preparedness extends beyond your four walls;
you need to interact with your suppliers and vendors down the line to
increase the effectiveness of their recalls plans, as well as your own.
• Identify a core recall team. Part of an effective recall plan also
includes identifying a recall team with dedicated personnel who are
effectively trained in implementing your recall plan. A common over-
sight is making sure members outside of logistics are on this team.
You should bring in colleagues from across the organization, including
operations, communications, finance and sales. With a wide variety
of recall team members, you can ensure you’ll have a better perspec-
tive on the affected customer base, where the product is, and how to
quickly and efficiently remove it from shelves.
Despite best efforts at prevention, the threat of a foodborne recall
still exists throughout your supply chain. With increased media and
government scrutiny, now is the time to prepare your company in
order to meet this threat head on. It’s the only way to effectively pro-
tect your consumers and your brand. ◆
Mike Rozembajgier is Vice President of Recalls for Stericycle
ExpertRECALL, online at www.expertrecall.com.
Protecting Your Supply Chain From Foodborne Pathogens
R O Z E M B A J G I E R
“Part of an effective recall plan also includes identifying a team with dedicated personnel who are effectively trained in implementing your recall plan.”
MONDAY & THURSDAY’S EDITION
Food Logistics
Warehousing and Transportation Solutions for the Food and Beverage Supply Chain
Food Logistics is proud to announce our new eNewsletter series, Fresh Take on:
Fresh Take on: Industry News covers a
range of general news relative to the food
supply chain, including trends and develop-
ments in the industry, new products and
services, regulatory compliance issues, and
changes in trade policy, to name a few.
Fresh Take on: Sustainability looks at
news relating to sustainability in the food
supply chain, from transportation and
logistics practices to more effcient
packaging design.
Fresh Take on: Software & Technology,
focuses on a very critical and rapidly evolving
sector in the food supply chain—software and
technology. Advancements and innovations
that improve supply chain visibility and
collaboration, enhance tracking and tracing,
and streamline operations are just some of the
news items that will be covered each Wednesday.
Fresh Take on: Safety & Security, reports on
safety issues as they apply to both physical safety
(in the warehouse environment, for example), as
well as safety in the food supply chain (regulatory
developments, etc.)
Subscribe today to these Fresh Takes at http://www.foodlogistics.com/reg/newsletter/
TUESDAY’S EDITION
WEDNESDAY’S EDITION FRIDAY’S EDITION
drive away with more
More innovation. More aftermarket support. More for your money.
When everything depends on delivering on time, on temperature and
on the money, you can’t afford to drive away with anything less than the
best built, most reliable, highest standard reefer on the road. Available
with our exclusive ThermoGuard™ and CorroGuard technologies,
Great Dane’s Everest series gives you more of the things that count
most...long-term value, performance and reliability.
Now in stock for immediate delivery at Great Dane branches andauthorized dealers. Or let us custom build a trailer tailored to your exact needs.
Explore our line of reefers online at
greatdanetrailers.com/refrigeratede v e r e s t
r e e f e r sTL CLSS
www.greatdanetrailers.com
Great Dane and the oval are registered trademarks of Great Dane Limited Partnership.
Find an approved Great Dane location near you by visitingwww.greatdanetrailers.com, or download our new mobileapp for free from the App Store or Google Play.