Food Logistics August 2015 by Supply+Demand Chain/Food Logistics

Food Logistics +

SECTOR REPORTS

• Robotics Adapts To F&B Demands • Prepare For DIM Package Weight Shipping • Big Data Redefines The Supply Chain • Trade Heats Up In The U.S. Southeast

Issue No. 169 August 2015

Global Supply Chain Solutions for the Food and Beverage Industry

HOW GLOBALIZATION CHALLENGES SAFETY IN THE FOOD SUPPLY CHAIN Pg. 18

Ray Griffin, C.H. Robinson's west region director, helps oversee one of the world's largest 3PLs.

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WEB EXCLUSIVES White Paper: Consumer Demand Makes Logistics A Competitive Differentiator In The Food Industry State Of The Foodservice Supply Chain Report: Cost Volatility Emphasizes Importance Of Supply Chain Archived Webinars, Including FL’s Educational Webinar Series

Food Logistics’ 2015 Top 3PL & Cold Storage Providers.

TOP

Pg. 34

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TOP THE TENTH ANNUAL

TOP

3PL & COLD STORAGE PROVIDERS This year's list reveals a noticeable trend. Specifically, more providers are adding new services to their portfolios to meet industry demands, which range from compliance with food safety and transportation regulations to customer driven requirements for real-time tracking and termperature-monitoring. Ultimately, 3PLs and cold storage providers on the 2015 list are commited to investing in their operations to stay ahead of the curve. Congratulations to these companies for their dedication.

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The 2015 Transit can offer a best-in-class gas-powered maximum CARGO CAPACITY OF 487.3 CUBIC FEET.†

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Global food trade network

ON THE MENU

Sweden Norway Denmark

Ireland

AU G U ST Finland

2015 • ISSU E N O . 169

Russia Poland How Globalization TRANSPORTATION 18 52 UK Trying To Make Sense CzechIn Republic ChallengesDESafety Of A DIM Situation FR JP packaging will affect South Koreaweight The Food Supply Chain Austria Hungary Dimensional ES

Companies turn toSwitzerland technology to help close safetyIT gaps. By Elliot MarasIran Portugal Greece Turkey Morocco Emirates Israel Saudi Arabia

Mexico Colombia Brazil Argentina Chile

18 Low connection via trade

Data Standardization Moves Forward To Meet Evolving Demands

most food and beverage shippers. ByChina Eric Sacharski

GS1 prepares for a major release of the Global Data Synchronization Network. By Angela Fernandez South Africa

THIRD-PARTY & REFRIGERATED LOGISTICS

Based on Ercsey-Ravasz et. al 2012 doi:10.1371/journal.pone.0037810

Figure 1

Philippines Singapore F&B Supply Chain Operations A data Indonesia explosion promises greater Malaysia efficiency in all areas. By Elliot Maras

DEVELOPMENT 66 ECONOMIC Trade Heats Up In The U.S. Southeast Australia

Growing agricultural imports/exports Zealand coupled with an expandingNew consumer population bodes well for the region. By Lara L. Sowinski

Food Safety Specialization

SPECIAL REPORT

Food Logistics’ 2015 Top 3PL & Cold Storage Providers

TOP

The trend reveals more providers are expanding their portfolio of services to meet industry demands. By Editorial Staff

Thailand

Temperature Control: The Ongoing Quest In The Food Supply ChainHigh connection viaCOLUMNS trade Technologies create options ranging from FOR STARTERS 6 satellite-based tracking to new refrigerants. By Elliot Maras

csey-Ravasz et. al 2012 doi:10.1371/journal.pone.0037810

& TECHNOLOGY 58 SOFTWARE Internet-based Technology Redefines

India

SECTOR REPORTS

WAREHOUSING

How Robots Will Tackle Changing F&B Demands

As smaller SKU orders challenge the food supply chain, robots and automation have a role. By Elliot Maras

The focus on food safety is promoting a more specialized approach from logistics service providers and others. By Lara L. Sowinski

INSIGHTS 16 COOL Design Considerations For Swiss Re

Food safety in a globalised world

Refrigeration/Cooling Facilities

Looking beyond the typical checklist helps ensure wise deployment of capital resources. By Todd Heine

(AND MORE) 68 FOOD FOR THOUGHT

Foodservice Industry Actively Shaping Safety Regulations And Standards Syndee Stiles of McLane Foodservice discusses food safety regulations, the GS1 U.S. Standards Initiative and more. By Caroline Perkins

DEPARTMENTS

8 Supply Scan • 12 Food on the Move • 49 Ad Index

Published and copyrighted 2015 by AC Business Media Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher. Food Logistics (USPS 015-667; ISSN 1094-7450 print; ISSN 1930-7527 online) is published ten times per year in Jan/Feb, March, April, May, June, July, August, September, October and Nov/Dec by AC Business Media Inc., 201 N. Main Street, Fort Atkinson, WI 53538. Periodicals postage paid at Fort Atkinson, WI 53538 and additional mailing offices. POSTMASTER: Send address changes to Food Logistics, PO Box 3605 Northbrook, IL 60065-3605. Canada Post PM40612608. Return Undeliverable Canadian Addresses to: Food Logistics, Station A, P. O. Box 25542, London, ON N6C 6B2. Subscriptions: US, one year $45, two years $85; Canada & Mexico, one year $65, two years $120; International, one year $95, two years $180. All subscriptions must be paid in U.S. funds, drawn on U.S. bank. Printed in the USA.

AUGUST 2015

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FOR STARTERS FROM THE EDITOR’S DESK

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Food Safety Specialization

hose of us working in the supply chain industry share a peculiar quirk. We are consummate label readers. Let’s be honest. When shopping for most any type of goods, whether it’s groceries or golf shirts, what’s the first thing we do? Look at the label to see where the item was grown or manufactured. I’ve always been fairly mindful of the food I consume and prepare for my family. As a Californian, I enjoy year-round farmers’ markets and locally grown produce on the menus of SOWINSKI restaurants along with grocery stores and markets brimming with fresh fruits, vegetables and seafood. But since assuming the editor’s position at Food Logistics, I have become even more interested in where my food is produced, how it is produced and by whom. Simply put, there are some things I feel more comfortable eating today and other things I wouldn’t dare touch. The food supply chain sector and consumers both are more focused on food safety than ever before, in turn driving new developments in food safety specialization. Third-party logistics providers, cold storage operators and others supporting the global food supply chain are redefining their offerings to provide new and improved products and services to enhance food safety. At the same time, food safety experts, from consultants to auditors to lawyers, are seeing more interest in their services. This month’s cover story examines how globalization is impacting food safety. A report by Swiss Reinsurance Company (Swiss Re) that looks at the correlation between increased globalization and food safety finds a sharp uptick in recalls. In the U.S. alone, food recalls have nearly doubled since 2002, according to the report. “Food recalls can be caused by something as simple as a labelling error on the packaging, or as complex as a microbial contamination somewhere along a vast globalised supply chain,” points out Roland Friedli, risk engineer at Swiss Re and co-author of the report. Jayne Plunkett, head of casualty reinsurance at Swiss Re, observes that, “In a more globalised economy, ensuring the highest level of food safety is becoming an ever greater challenge for firms.” Adding, “Today, ingredients and technologies are sourced worldwide. This leads to greater complexity for food manufacturers and consumer and regulatory demands on companies are continually increasing.” Our August issue also features Food Logistics’ annual Top 3PL & Cold Storage Providers list. As we reviewed the applicants this year, it was clear that food safety specialization is paramount for these companies too. Congratulations to all of them for their dedication. Enjoy the read.

LARA L. SOWINSKI, EDITOR-IN-CHIEF LSOWINSKI@ACBUSINESSMEDIA.COM

AUGUST 2015

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Published by AC Business Media Inc.

201 N. Main Street, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com PRINT AND DIGITAL STAFF Publisher Jolene Gulley Editor-in-Chief Lara L. Sowinski lsowinski@ACBusinessMedia.com Managing Editor Elliot Maras emaras@ACBusinessMedia.com Assistant Editor Eric Sacharski esacharski@ACBusinessMedia.com Ad Production Manager Cindy Rusch crusch@ACBusinessMedia.com Creative Director Kirsten Crock Senior Audience Development Manager Wendy Chady Audience Development Manager Tammy Steller ADVERTISING SALES (800) 538-5544 East Coast Sales Manager Judy Welp (480) 821-1093 jwelp@ACBusinessMedia.com Midwest/West Sales Manager Carrie Konopacki (920) 542-1236; Fax: (920) 542-1133 201 N. Main Street, Fort Atkinson, WI 53538 ckonopacki@ACBusinessMedia.com National Automotive Sales Tom Lutzke (630) 484-8040; tlutzke@ACBusinessMedia.com EDITORIAL ADVISORY BOARD Smitha G. Stansbury, partner, FDA & Life Sciences Practice, King & Spalding Raymond J. Segat, director, cargo & business development, Vancouver Airport Authority Dr. Barbara Rasco, professor and interim director, School of Food Science, Washington State University Adriano Melluzo, vice president, national sales, Ryder CIRCULATION & SUBSCRIPTIONS PO Box 3605, Northbrook, IL 60065-3605 (877) 201-3915, Fax: (800) 543-5055 Email: circ.FoodLogistics@omeda.com LIST RENTAL Elizabeth Jackson, Merit Direct LLC (847) 492-1350, ext. 18, Fax: (847) 492-0085 Email: ejackson@meritdirect.com REPRINT SERVICES Carrie Konopacki (920) 542-1236; Fax: (920) 542-1133 ckonopacki@ACBusinessMedia.com AC BUSINESS MEDIA INC. Chairman Anil Narang President and CEO Carl Wistreich Executive Vice President Kris Flitcroft CFO JoAnn Breuchel VP Content Greg Udelhofen VP Marketing Debbie George Digital Operations Manager Nick Raether Digital Sales Manager Monique Terrazas Published and copyrighted 2015 by AC Business Media Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher.

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SUPPLY SCAN

D A I LY U P D AT E S AT WWW.FOODLOGISTICS.COM

NE WS FROM ACROSS THE F O O D SU PPLY C H AIN

FDA Proposes Rule For Third Party Audits Of Imported Food The Food and Drug Administration (FDA) has issued a proposed rule to amend the accreditation of third party auditors and to establish a user fee program for audit administration for imported food. The proposal establishes a reimbursement program to assess fees and require reimbursement for administering accreditation of third-party auditors under the FDA Food Safety Modernization Act (FSMA). This rule establishes regulations for accreditation of

third-party auditors to conduct food safety audits. The use of accredited third-party auditors to certify food imports will assist in ensuring the safety of food from foreign origin entering U.S. commerce.

Humane Society Calls For Federal Investigation Of Costco Eggs The Humane Society of the United States has claimed that a Costco egg supplier has misrepresented the way its eggs are produced. The complaints call for two federal agencies to investigate potential violations of federal false advertising and health and safety laws. The complaints—one filed with the Federal Trade Commission and one with the Food and Drug Administration —allege that Costco egg supplier Hillandale Farms deceived consumers concerned about animal welfare and that

FDA Extends Restaurant Menu Labeling Compliance One Year The FDA provided a 1-year delay to the date restaurants – and those deemed by FDA to be “similar retail food establishments” – will be required to apply the final chain restaurantmenu labeling rule. The Food Marketing Institute (FMI), a food supplier organization, welcomed the news. “We’re encouraged that FDA’s commitment will give us more time to at least garner some clarity and answers without feeling rushed to make difficult business decisions in an attempt to comply by Dec. 1, 2015 with regulations that are unclear,” the FMI stated. FMI will continue to work with both FDA and Congress to address business challenges with implementing restaurant menu labeling in grocery stores.

the unsanitary conditions at Hillandale present serious food safety concerns.

Albertsons Companies Files For Public Offering Albertsons Companies, Inc. has filed with the Securities and Exchange Commission for a proposed initial public offering of shares of its common stock. The number of shares to be offered and the price range for the proposed offering have not yet been determined. Food Logistics reported in January that the Federal Trade Commission approved a merger of Albertsons and Safeway. Albertsons is the second largest U.S. supermarket chain after Kroger.

U.S. SOYBEAN IMPORTS U.S. imports of soybeans have grown from a total value of $96 million back in 2007 to over $1.1 billion in 2014. So far in 2015 (January to May), U.S. imports of soybeans are down 44 percent. Although most U.S. soybean imports arrive in June and July, we may still see an increase in imports from 2014 to 2015. In the last two years, the U.S. has begun importing a significant amount of soybeans from the Ukraine. In fact, beginning in 2014, Ukraine exported over $22 million in soybeans to the U.S. and so far this year (January to May), that number has already reached $25 million. Before 2014, Ukraine exported no soybeans to the U.S. and now it’s a top five supplier.

Top 5 Countries of Origin for U.S. Soybeen Imports (2015 Jan-May)

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2012

2013

2014

47%

■ Canada ■ India ■ Ukraine ■ All Other ■ China ■ Chile

24%

$1.00 $0.90 $0.80 $0.70 $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $Q4

5% 4%

Average Price per Kilogram of U.S. Soybean Imports

11%

All data provided by Zepol. Visit zepol.com for a Free Trial

2015

Source: Zepol, www.zepol.com www.foodlogistics.com

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SUPPLY SCAN

D A I LY U P D AT E S AT WWW.FOODLOGISTICS.COM

NEWS FROM A CROS S THE F O O D SU PPLY C H AIN

Federal And State Officials Investigate Salmonella Outbreaks Linked To Chicken Officials with the U.S. Centers for Disease Control and Prevention (CDC), the USDA’s Food Safety and Inspection Service (FSIS), and the Minnesota Departments of Health and Agriculture (MDH) are investigating two outbreaks of Salmonella Enteritidis linked to raw, frozen, breaded and pre-browned stuffed chicken entrées, according to Food Safety News. In the first outbreak, MDH identified four people infected with a strain of Salmonella Enteritidis with illness onset dates ranging from April 5, 2015, to June 8, 2015. Two people were hospitalized. Epidemiologic and traceback evidence linked these illnesses to eating Barber Foods brand Chicken Kiev raw stuffed chicken breast. This investigation is ongoing. In the second outbreak, MDH identified three people infected with a different strain of Salmonella Enteritidis with illness onset dates ranging from May 9, 2015 to June 8, 2015. Two people were hospitalized.

Debate Rages Over GMO Labeling Rules The debate over whether or not food companies should be required to label genetically modified organisms (GMOs) in food continues, according to The Wall Street Journal. Andrew Kimbrell, executive director of the Center for Food Safety, and Dr. Nina Federoff, Pugh 10

AUGUST 2015

professor emerita at Penn State University, squared off over mandatory GMO labels. Consumer advocates are pushing for mandatory GMO labels while U.S. states have taken different approaches to the requirement. Consumer advocates say GMOs carry risks while providing few nutritional benefits. Opponents say these fears are exaggerated.

Drought Hammers California Farms And Ranches As holders of some of the oldest water rights in California, many farmers and ranchers in the Sacramento-San Joaquin Delta have never had their spigots turned off, a fate many of their counterparts in the parched state have endured, according to reports. But under an order from the State Water Resources Control Board, the Byron Bethany Irrigation District recently shut down irrigation to more than 160 farmers and ranchers in its 30,000-acre area.

A&P Files For Bankruptcy Again; Will Sell 120 Stores A&P is filing for Chapter 11 bankruptcy with plans to sell off stores as it faces increasingly tough competition, according to the Associated Press. This marks the second time in five years that the Montvale, N.J.-based company has filed for bankruptcy. This time around, it said it has more than 100,000 creditors along with more than $1 billion in liabilities and over $1 billion in assets.

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The company plans to sell as many of its 296 stores as possible and said in a filing with U.S. Bankruptcy Court in New York that it has bidders for 120 of those operations with expected proceeds of $600 million. The grocery chain has faced tougher competition from companies like Walmart and Target Corp. expanding their grocery options. The business has grown even more crowded and competitive with companies like Whole Foods Market Inc. and Fairway Group Holdings Corp. catering to a more healthconscious market.

Center For Food Safety And Applied Nutrition Outlines Technology Gaps The Center for Food Safety and Applied Nutrition (CFSAN), which produced the FDA Science and Research Strategic Plan for 2015-2018, acknowledges there are some “knowledge gaps” that must be addressed if FSMA is going to be successfully implemented. “Further, globalization, new technologies, and increased consumer dreaming for fresh and imported food products are driving a need for new tools and standards to regulate a more complex and diverse food supply and cosmetic industry,” the plan states. “Given these pressures and scope of regulatory authority, CFSAN is directing resources toward targeted and strategic scientific research that supports regulatory decision making and meets the demands of emerging and existing food and cosmetic safety issues in the 21st century,” the plan further states.

JBS USA Pork To Acquire Cargill Pork For $1.45 Billion JBS USA Pork has agreed to acquire Cargill’s U.S.-based pork business for $1.45 billion. Completion of the acquisition is subject to regulatory review and approval.

Included in JBS’ acquisition of Cargill’s pork business are two Midwest meat processing plants, one in Ottumwa, Ia., and the other at Beardstown, Ill. Cargill acquired both plants in 1987, and in 2014 they processed a total of 9.3 million hogs. The purchase by JBS also includes five feed mills (two in Missouri, and one each in Arkansas, Iowa and Texas), and four hog farms (two in Arkansas and one each in Oklahoma and Texas).

PETA Sues California Over Chicken Electrocutions Using reports showing that one third of chickens are inadequately stunned in California slaughterhouses—leaving them conscious and able to feel pain as their throats are slit—and that an estimated 7 million birds per year aren’t properly bled to death before they’re plunged into scalding-hot defeathering tanks, People for the Ethical Treatment of Animals (PETA) filed a suit in Los Angeles Superior Court against the California Department of Food and Agriculture. PETA contends electric stunning violates California’s humane slaughter law, which requires animals to be rendered insensible to pain before being cut and bled, as well as the California Penal Code. www.foodlogistics.com

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FOOD ON THE MOVE LOGISTICS TRENDS IN OUR INDUSTRY

Greek Crisis Fuels Oil Price Fall Oil prices plunged in July in the aftermath of the Greek referendum, which saw the Greek people hand Prime Minister Alexis Tsipras an overwhelming victory after they decisively rejected Europe’s bailout terms, according to

oilprice.com. The “no” vote provides Tsipras with renewed momentum in negotiations with European creditors. Led by Germany, creditor nations had hoped that a “yes” vote would force the Greek government into further austerity measures in exchange for an extension of the bailout. The “no” vote has created turmoil across the globe, and oil prices have crashed to their lowest levels in months.

offices in over 100 countries, has agreed to acquire ReTrans Inc., a U.S.-based provider of multimodal transportation management solutions. The acquisition builds on Kuehne + Nagel’s overland strategy and will strengthen the company’s position as an end-to-end logistics provider in North America.

Kuehne + Nagel To Acquire ReTrans Inc. The Kuehne + Nagel Group, a Switzerland-based logistics firm with more than 1,000

DAT SOLUTIONS’ MONTHLY FREIGHT REPORT

Biggest Fleets Gain Share By Mark Montague

he largest truckload fleets have been commanding a bigger share of the freight marketplace in recent months, and for an unexpected reason: improved driver turnover rates. During the first quarter of 2015, annualized turnover at truckload fleets with more than $30 million in revenue dropped 12 percentage points to 84 percent, its lowest level in four years, according to the American Trucking Associations. Another factor is that large fleets are replacing old trucks and using new ones as incentives for drivers. Class-8 truck orders rose 42 percent to 380,200 net orders in 2014 and the number of tractors on U.S. highways is expected to rise nearly 6 percent this year to 1.43 million, reports ACT Research. The combination of better driver retention and fleets with new, more fuel-efficient, and cost-effective trucks is a boon to large truckload carriers. According to second-quarter financial reports, this group has generally done a fine job controlling operating costs and improving equipment utilization. Deadhead miles are down. Where does this leave small truckload carriers? If you can put trucks and drivers in the right place at the right time, there is money to be made—even in a soft market. For instance, reefer load availability increased 5.5 percent in June, but capacity also added 6.3 percent compared to May. The overall load-to-truck ratio was stable (down 0.8 percent) at 5.9 loads per truck, month-over-month, but compared to the unusually high demand of June 2014, the ratio fell 49 percent. Load-to-truck ratios are important. They represent the number of loads posted for every truck posted on DAT load boards and they’re a real-time indicator of the balance between spot market demand and capacity. Changes in the ratio often signal impending changes in rates.

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When you map load-to-truck ratios on a state-by-state level—see the June 2015 map of reefer load-to-truck ratios from dat.com/trendlines, for example—wherever the reefer load-totruck ratio appears high (darker blue areas) signals an imbalance that favors the carrier. You can drill down more closely. For example, the Cape Girardeau, Mo. market ships melons which came in season in late July. In a few weeks, markets farther north will come into play, boosting rates during the fall harvest season. A high load-to-truck ratio doesn’t mean that rates are high in the direction you want to go. But if you have a truck in the region, or you have an inbound load, it can tell you that those are good places to start looking for freight. Certain advantages in the market may be swinging back to big fleets, but any carrier can win by working smarter. Mark Montague is the senior industry analyst for DAT Solutions, which operates the DAT® network of load boards and RateView rate-analysis tool. He has applied his expertise to logistics, rates, and routing for more than 30 years. He is based in Portland, Ore. For information, visit www.dat.com. www.foodlogistics.com

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WHAT IF COLD CHAIN

EXPERTS

HELPED YOUR PRODUCE ARRIVE FASTER, FRESHER?

ACCELERATE YOUR ADVANTAGE

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FOOD ON THE MOVE LOGISTICS TRENDS IN OUR INDUSTRY

Taco Bell Launches Delivery Service With DoorDash Taco Bell delivery is rolling out to select markets through a partnership with ondemand delivery service DoorDash. The delivery service will be available in over 90 cities and more than 200 restaurants throughout the Los Angeles, Orange County, San Francisco Bay and Dallas regions. The partnership provides delivery service through the DoorDash website and iOS and Android apps. Pricing and delivery costs may vary depending on restaurant location.

Trucking Group Calls On FMCSA To Move To Risk-Based Enforcement The American Trucking Associations called on the Federal Motor Carrier Safety Administration (FMCSA) to accelerate the agency’s efforts to integrate more risk-based assessments into its enforcement programs in light of a report made public by the Department of Transportation. During investigations of four commercial motor vehicle crashes, the National Transportation Safety Board found that FMCSA had failed to identify significant safety issues during prior audits of the motor carriers involved in the crashes.

Feds Grill 19 Ocean Carriers On West Coast Ports Collaboration Federal officials are requiring the world’s largest shipping companies to provide detailed documentation on how they are implementing service agreements on the U.S. West Coast amid concerns over a collaboration the companies formed to address port congestion, according to The Wall Street Journal. The Federal

Maritime Commission issued the order to 19 international ocean carriers.

EPA To Eliminate HFCs Used In Reefer Cooling And Grocery Refrigeration The Environmental Protection Agency (EPA) has finalized a rule to prohibit certain uses of chemicals that significantly contribute to

AUGUST 2015

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West Coast Ports Lose Import Container Trade As Asian Shippers Reroute

est Coast ports’ share of container imports fell to 45 percent in May, down from 51.5 percent a year ago, as the effects lingered from massive delays earlier this year, according to data released by the U.S. Census Bureau. The decline—meaIn this Feb. 12, 2015 file photo, the Port of Los Angeles, with some cargo loading cranes in the upright sured in the dollar value of goods and idle position, are seen in this view from the San imported in containers—is partly Pedro area of Los Angeles. AP Photo/Nick Ut, File due to decisions by many Asian shippers to reroute cargo to the Gulf and East Coasts after protracted West Coast labor negotiations led to delays earlier this year at Pacific ports.

climate change in favor of safer, more climate-friendly alternatives. The agency also granted a 3-year extension to manufacturers of refrigerated trailers and their suppliers through 2019 to develop a foam-blowing agent that does not incorporate strong greenhouse gasses. This EPA rule finalization responds to President Obama’s Climate Action Plan by reducing emissions of hydrofluorocarbons (HFCs), which represent a class of potent greenhouse gases used in air-conditioning, refrigeration, and other equipment.

California Gov. Brown Calls For Zero Freight Emissions California Gov. Jerry Brown called on state leaders to develop a plan to transition to zero-emission technologies in the freight industry, according to reports. In an executive order, Brown said the state has set “aggressive targets for reducing pollution” by 2030, including decreasing greenhouse gas emissions and cutting petroleum use in automobiles by half. Brown

UPS Seeks To Acquire Coyote Logistics For $1.8 Billion United Parcel Service Inc. is in talks to buy Coyote Logistics LLC for about $1.8 billion, people with knowledge of the matter said, according to Bloomberg News. Coyote is backed by New York-based private equity firm Warburg Pincus, which first invested in the company in 2007.

Ports And Truckers Face Chassis Shortage As U.S. seaports enter their busiest season, shippers and truckers expect to be plagued with a familiar problem: a shortage of chassis, a key piece of equipment that allows trucks to transport shipping containers, according to The Wall Street Journal. Finding a free chassis – little more than a steel frame with wheels – can take hours, making them a top source of port congestion because containers can’t be transferred from a ship to a truck without them, truck drivers say. Leasing companies also rent different types of chassis, so drivers must often go out of their way to return the equipment to specific locations, creating traffic problems at ports. Some trucking companies are bracing for particularly bad congestion as ports ramp up for their busiest time of year. www.foodlogistics.com

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COOL INSIGHTS BY TODD HEINE

Design Considerations For Refrigeration/Cooling Facilities

hen planning a food services facility, conventional wisdom dictates that companies look first at the land site, capacity and overall flow of the space. While those factors are important, they are just part of a more detailed equation. Factors such as growth projection and any potential for specialized equipment and/or storage needs also should be considered to ensure wise deployment of capital resources. Companies that rely on refrigeration and cooling — and the mechanical systems that power them — should focus on feasibility planning and strategic growth projections when evaluating their facility needs. This will help ensure that a new facility is designed with longrange growth in mind, as well as the need for efficiency and productivity. This type of approach begins with detailed planning that examines not only the type of food production required, but sales

AUGUST 2015

and operational projections — even potential acquisitions. Many companies make the mistake of planning a facility for today when they should focus on where their production would be in five, 10 or 15 years. During site selection, executives from finance, operations and related departments should reach a consensus on expected growth and how that translates to facility capacity. If expansion is a long-term goal, companies should add 20 to 30 percent as a buffer to cover growth for the near future.

Space, utilities and water Another important tool is a utility feasibility study, which will help determine if the site has adequate electrical power and water capacity to meet longrange needs. Companies that rely on refrigeration and freezing capacity often require large volumes of water on a daily basis. Part of the site selection process should involve identifying the availability and reliability of the water supply.

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While it might be tempting to use conservative growth projections as a way to minimize facility needs and related costs, that approach can be shortsighted. It is better to spend more for a larger facility or land site that allows for future growth and expansion than to build a “just right” building and reach capacity in a few short years. Without adequate square footage or vacant land to grow into, a company would face the added cost and disruption of moving or trying to grow in a facility that was not designed for expansion. This is particularly troubling in facilities with heavy refrigeration and cooling needs, as that equipment is a significant component of the facility cost. It also is vital to business operations. If the facility is not designed to accommodate expansion, efficiency and specialized production needs, a newly-installed, state-of-the-art freezing and cooling system could quickly become obsolete. Planning for growth will help to alleviate those issues. Refrigeration and cooling systems should be located in an area with adequate room for future extension, for example. This often means placing the units adjacent to each other and several feet away from walls to allow for expansion in different directions. This seemingly simple design sometimes is overlooked in the haste to find a creative space

HEINE

plan or efficient production flow for the facility. Refrigeration and cooling systems are prone to temperature fluctuations. In northern climates, it is important to design facilities with a realistic view of temperature extremes. When building a facility in a city such as Minneapolis, for example, it is important to plan around seasonal weather changes.

Consider special needs Another consideration similar to accommodating a tenant’s refrigeration needs are potential requirements such as allergen rooms and autoclaves. Again, it is crucial for tenants to look at future needs in these areas, although an occupier may use third-party vendors for specialized production such as peanuts or off-site facilities for sanitation. It may be cost beneficial to move those operations in house in the future. In order to accommodate this shift it is imperative to incorporate infrastructure from the onset of construction. By identifying growth trends and corporate goals for significant changes, such as acquisitions or mergers, company leaders can make informed decisions about facility location, size, layout and expandability. Todd Heine is a principal at Avison Young Corporate Food Services Group, a global real estate firm focusing on food manufacturing and distribution companies. ◆ www.foodlogistics.com

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Is your business exactly the same as your competitor’s business? Do you have exactly the same processes and procedures in place? Of course not! Your business is unique to your organizational style and the team that runs it. Developing a food safety program that allows you the flexibility you need within your daily routine, yet meets the criteria of your customers, FSMA, GFSI, and your internal culture is probably very important to you. Choosing a standard that provides practical and flexible, yet strong methods of meeting safety requirements is as important as meeting the requirements themselves. With the right standard, you get to choose how the standard operates within your walls, how your team culture is influenced to provide more efficient and safer processes.

The implementation of the right standard, a flexible standard, provides value to your organization. If you are not a food processor, why would you put food processing criteria to work in an environment meant for storing and distributing or transporting food? Building a strong food safety program for your warehouse, distribution, or transportation organization is critical to your customer’s needs, and to your ability to ensure the delivery of a safe product. Why not build a program that suits you – as you are today, and not how someone else wants you to be! When you select a standard, select one that works for you. But consider the proven, published benefits of each standard before you choose. And choose a standard designed for your business!

Global Food Safety and Quality Standards IFS Family of GFSI Benchmarked Certification Standards for the food supply chain

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Learn more by visiting our website and downloading our free standards. Join our group on LinkedIn at IFS Food.

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www.ifs-certification.com

8/3/15 1:46 PM

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tered by third-party audit organizations. Lineage Logistics, based in Colton, Calif., in 2012 began introducing SQF certification to its facilities. The SQF certification is more stringent than the Good Distribution Practices (GDP) certification the company was using for its facilities, says Jim Reynolds, director of food safety and compliance. Lineage contracts SAI Global for both GDP and SQF certification audits. The SQF certification is a GFSI approved protocol, Reynolds says. In 2007, eight of the nation’s largest food retailers began requiring food vendors to be GFSI certified. By next February, 15 of Lineage Logistics’ 112 facilities will have SQF certification. Most of the technologies employed in complying with the audits have been available for some time, Reynolds says. These include temperature controllers on transportation vessels, temperature monitoring systems in storage rooms, and security cameras. “A lot of these technologies have existed—it’s a matter of employing them to a higher degree of rigor,” Reynolds says. The technology that has improved the most has been remote temperature monitoring, he says. The technology can alert a supervisor in real time when a temperature is approaching a certain point. Smith at Eurofins USA says food safety certifications are growing 25 percent a year in the U.S. The U.S. is rapidly catching up to Europe, which has had a 15 -year head start in this area. Food safety regulations are driving some of this certification activity, Smith notes. “There’s a feeling that if a company has a certification audit, the government may reduce the risk of that organization and therefore reduce inspection frequency,” he says. The different certification programs, notably GFSI benchmarked standards, have their unique strengths. As a certification audit provider, Eurofins educates clients about the difference between the programs to help the customer decide which program best meets their needs. Certain programs may be more appropriate for companies based on their cultures, markets and industry. 20

AUGUST 2015

• FOOD LOGISTICS

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Global Trade Brings More Pest Problems: By Patricia Hottel

What To Do?

he percentage of food imported into the U.S. is on the rise and that trend is expected to continue. With imports, can come pests. The challenge of controlling new invasive species will continue with the expansion of imports. Invasive pest species such as the brown marmorated stink bug and kudzu bug provide new control challenges. Both of these insects are agricultural pests and will overwinter in structures in large numbers, causing problems for both farmers and food processors. They are not native species and are spreading rapidly. In addition to the true bug invasives, there have been some new invasive ant species introduced in the South like the Caribbean crazy ant and the Asian needle ant. The quarantined, stored product pest, the Khapra beetle continues to show up in the ports of the U.S. in increasing larger numbers. This pest can be imported on products such as rice, flour and spices from Asia and Africa, and it is a particularly devastating stored product pest. With global commerce, the risks from invasive species are likely to continue. Food safety regulations and third party audit changes are driving change in food facilities. The Global Food Safety Initiative (GFSI)-based audits are particularly focused on the documentation facets of the pest management process and program. Likewise, strong documentation to verify an effective pest management program will be needed for food safety regulatory compliance under the Food Safety Modernization Act (FSMA). Strengthening the food safety programs of imported food will also be targeted under FSMA. The ongoing protection of environmental initiatives will continue to have an impact on the pest management industry. A recent example of this can be seen in regulations designed to protect pollinating insects. Although many applaud the protection of the environment, there can be consequences. Some of these same pollinators like bees can provide sting hazards to food plant staff and food contamination concerns in sugar and corn syrup processing facilities. Innovative techniques are required to protect employees, food products and the environment. The economics of performing some tasks like cleaning and structural repair are being cut in some food plant budgets. These budget cutting measures can directly impact pest management. Sanitation and structural integrity are all critical elements of pest management, which are needed for control success. For some groups of pests like the stored product insects and small flies, elimination of the food source is essential to control. If you do not • Sanitation is especially important eliminate the source, there are limited alternatives when stored product pests are found for long-term management of the problem. inside food processing equipment where Pest management includes reducing the condipesticide use may be restricted. tions that contribute to pest survival. Yet the costs for services such as cleaning, which help remove pest food sources, have consistently risen. Many facilities have reduced budgets in housekeeping staff. Improved sanitation is especially important when stored product pests are found inside food processing equipment where pesticides use may be restricted. In addition, it is important to remove evidence when pest activity occurs, which is also often a staff function. Checking for reappearance of pest evidence can help the pest sealing in determining pest status. One way that pest management professionals can assist in cleaning includes web removal programs, bioremediation programs for organic material accumulations in drains and other areas, and dropping removal through vacuuming. To help in expediting and completing structural deficiency needs, some firms are now offering minor pest proofing to deny pest building access and harborage. Stainless steel mesh based products such as Xcluder can be used to seal small openings and these services are offered by pest management professionals. Many pest management firms will also offer door brush or door seal replacement to exclude pests like rodents. ◆ Patricia Hottel is technical director at McCloud Services. www.foodlogistics.com

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How To Control Trailer And Container Access In The Food Supply Chain

rakLok International LLC, a firm specializing in trailer and container access control, became active in the food trade recently in response to food shipper requests, according to CEO Tom Mann. The TrakLok device is an electromechanical system that provides an integrated access control, tracking and sensor/ alarm platform. The system protects cargo integrity by monitoring lock and latch status changes, and providing enter/exit geofence alerts. It notifies personnel by emails and text messages.

US 2014 CARGO THEFT BY COMMODITY (TOP 5) Food and beverage leads all categories in cargo theft.

140

Metals

Household

Electronics

91 Apparel & Accessories

159 Food & Beverage

Incidents Reported to CargoNet

211

Source: CargoNet, a division of Verisk Crime Analytics

One of the advantages is that the system creates an electronic record. The driver uses a code to open a door. The system records who opened the door and how long the door was open. “The reporting side has become most important to these (food) customers,” Mann says. “It’s a brand protection issue.” Food is a leading cargo for over the road burglary since it is easy to resell, he says. The rate of food theft is rising. “Cargo at rest is cargo at risk,” he says. TrakLok recently upgraded its reporting function to support compliance with the reporting requirements for the Food Safety Modernization Act (FSMA). While electronic access control is common for facility security, trailer and container access control are traditionally mechanical-only systems requiring manual recording and reporting of events. ◆ 22

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• FOOD LOGISTICS

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Food safety certification standards are specific to the key user groups: manufacturers, distributors and retailers, Smith says. For instance, the standards for manufacturers are not the same as for retailers. For distribution centers, audits focus heavily on temperature reporting in cold storage areas. Added concentration areas include product rotation, protection from temperature abuse, employee hygiene and cleanliness during transportation. A distribution center audit will take one to two days depending on the size of the company. Eurofins USA certifies food manufacturers and distribution centers. For direct retailers audits (restaurants, supermarkets, etc.), the company partners with Charlotte, N.C.-based Steritech Group Inc. Attendees at this year’s International Association of Refrigerated Warehouses (IARW)—World Food Logistics Organization (WFLO) convention and expo in Orlando, Fla., got a chance to hear from three cold chain service providers who have implemented safety standards. Ken Johnson, senior vice president of MTC Logistics in Baltimore, Md., told the gathering that voluntary safety certification makes for a better company. He noted that BRC audits are more stringent than customer safety audits. He said the safety audit, which lasts a day and a half, cost the company between $3,500 and $5,500. Supply chain providers are also finding better tools coming on the market for their internal safety testing. RLS Logistics, a 3PL based in Mt. Laurel, N.J., has introduced a more efficient listeria testing product called Sample6, says Selina Hart, RLS quality assurance manager. The Sample6 testing is done onsite at the company’s Newfield, N.J., facility and eliminates the 5-day process of sending samples to an offsite laboratory. The Sample6 kit consist of a substance that gives a light indication within seven hours. “It gives you a lot of information quickly and you’re able to react faster,” Hart says. “We have the ability to sample a lot more. It’s fun and it’s amazing.” The company has doubled the amount of tests with the new system. RLS developed its own software that emails supervisors and technicians when to do listeria tests. The software system also creates a record of the results. The new system not only saves time, according to Hart; it reduces the chance for a contaminated product to go undetected into the supply chain. Norpaco Gourmet Foods, a Middleton,

Conn.-based manufacturer of Italian-style specialty foods for grocery stores and restaurants, has built an environmental testing program using Sample6. Shifting from managing multiple spreadsheets has been a time saver, says Tiffany Ptaszkiewicz, manager of safety and quality. The software automatically uploads the test results with other test results so all results can be viewed in one place. With increasing globalization of the food supply chain, supply chain service providers must consider the full potential for lapses in safety controls. Stricter safety regulations are forcing these companies to pay closer attention to all possible vulnerabilities, a development that safety conscious supply chain service providers welcome. At the same time, advances in safety technology are providing more tools to the industry to better safeguard the global food supply chain. ◆

For more information: BRC, 44-0-20-7854-8921, www.dbrcglobalstandards.com ECOLAB INC., 651-293-2233, www.ecolab.com EUROFINS USA, 515-265-1461, www.eurofinsus.com IFS, 49-0-30-726-25-062, www.ifs-certification.com INTERNATIONAL ASSOCIATION OF REFRIGERATED WAREHOUSES, 703-373-4300, www.gcca.org GLOBAL FOOD SAFETY INITIATIVE, 33-1-82-00-95-85, www.mygfsi.com GLOBAL GAP, 49-0-221-57-993-25, www.globalgap.com INTERNATIONAL FOOD INFORMATION COUNCIL, 202-296-6540, www.ific.us LINEAGE LOGISTICS, 800-678-7271, www.lineagelogistics.com MCCLOUD SERVICES, 224-227-6500, www.mccloudservices.com MTC LOGISTICS, 410-342-9300, www.mtccold.com RLS LOGISTICS, 856-694-3216, www.rlslogistics.com SAMPLE6, 617-393-7600, www.sample6.com SQF, 202-220-0635, www.sqf.com STERITECH GROUP, 800-868-0089, www.steritech.com STETON TECHNOLOGY GROUP, 435-656-5655, steton.com SWISS REINSURANCE CO. LTD., 41-43-285-2121, www.Swissre.com, TRAKLOK INTERNATIONAL, 865-927-4911, www.traklok.com www.foodlogistics.com

8/3/15 1:33 PM

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8/3/15 1:33 PM

C O V E R

S T O R Y

Data Standardization Moves Forward To Meet Evolving Demands GS1 prepares for major release of Global Data Synchronization Network.

oday, meeting the demand for accurate and consistent information for consumers, trading partners and regulators is essential for success. Consumers are expecting to have complete and trustworthy product information available at their fingertips, trading partners are looking to enhance operational and supply chain efficiencies, and regulatory compliance now requires accurate, real-time traceability information from field to shelf. Though these challenges can be daunting for large and complex organizations, the good news is that data synchronization provides a standardized way for food industry trading partners to ensure their product attributes are accurate, complete and up-to-date—and this continues to evolve with the needs of industry. The Global Data Synchronization Network (GDSN) has been enabling trading partners to globally exchange product information in an automatic and efficient way for more than a decade. The GDSN is part of the GS1 System of Standards— the most widely-used supply chain standards in the world. The system enables a common language to identify, capture and share product information, ensuring better data quality and greater efficiencies. With the GDSN, food manufacturers, distributors, retailers and operators have access to the same continuously refreshed data. The role of GDSN is to help ensure the most accurate product data is shared between 24

AUGUST 2015

trading partners in an efficient approach, and connects the physical flow of goods and services to the flow of information. Currently, information such as package measurements, nutrients, ingredients, allergens and whether the food is gluten-free, Kosher, Halal, vegan or organic for 579,000 food items is synchronized in the network in the

U.S., and the number of items continues to grow every day.

GDSN major release set for 2016 Since the early 2000s, food manufacturers and their trading partners have relied on the GDSN as a single source of reliable data. Beginning May 6, 2016, the GDSN will be restructured and streamlined to keep pace with today’s business environment. The changes are termed a “Level 3 Major Release,” which signifies a complete version change (from 2.8 to 3.1) and is non-backward compatible—users cannot use the previous version once the major release takes place. The 3.1 release is designed to respond to market needs to

support regulatory compliance requirements, provide product information for business-toconsumer purposes and increase speed-to-market capabilities. The change will severely impact the foodservice and retail grocery industries, as there are numerous enhancements planned for the manner in which food and beverage product information is shared. To name just a few changes, there will be product attribute deletions, some attributes will now be mandatory instead of optional, and there will be a restructuring of message formats. So how can you prepare for these major enhancements and ensure your business is not impacted during the transition? Here are some helpful do’s and

The GS1 Global Data Synchronization Network ensures uniform data standards throughout the food supply chain.

• FOOD LOGISTICS

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BY ANGELA FERNANDEZ

www.foodlogistics.com

8/3/15 1:30 PM

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don’ts from our experts: Don’t wait. With less than a year to go until the transition takes place, there’s not much time; for those in the data world that is bordering on the 11th hour. As the old adage goes “Prior planning prevents poor performance.” Organizations

can eliminate major hiccups and inconsistencies by knowing more about what’s changing and why. GS1 US offers opportunities to learn more about the major release, including webinars and online learning tools. A complete listing is available at www.gs1us. org/gdsnmajorrelease.

Additionally, the GDSN team has already been busy preparing the various new standard documents associated with the major release. They are available on the GS1 website in a section outlining all GDSN v3.1 major release standards. Additionally, GDSN posts helpful information tools

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• FOOD LOGISTICS

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on an implementation-oriented website, which provides resources on the business value of the GDSN and how to manage the change. Watch for GDSN to release helpful information like this throughout the year ahead to facilitate a smooth transition for all trading partners. Gather all stakeholders to develop an organization-wide plan. Professionals in the field of information technology, data management and data synchronization will most

Online Tool Offers Attribute Definitions

new GS1 US online tool will address industry demand for standardized product attribute definitions and help businesses better serve the information needs of trading partners and customers. GS1 US Attribute Explorer, a centralized, web-based repository of more than 2,700 product attribute definitions and 3,600 code list values will enable industries to streamline the exchange of product data by providing one source for GS1 standardized terms. GS1 US Attribute Explorer provides retailers, marketplaces, suppliers, brand owners, and manufacturers with access to standardized definitions for attributes such as brand, ingredients, allergens and other types of product information that have already been defined in the GS1 Global Data Dictionary and through GS1 US industry initiatives. Users can view a list of standardized attributes or search attributes by name or description. They can also ascertain whether an attribute is defined in standards or industry guidelines, identify the attributes for a given product category, and determine which attributes are required by demand-side partners or government regulations. ◆ www.foodlogistics.com

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www.foodlogistics.com

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nization, a list of certified data pools is available on the GS1 website. Certified data pools comply with GS1 Standards. All of the data pools have been certified as capable to process GDSN v3.1 messages. The GDSN major release will significantly change to the

way data is shared throughout the entire food industry—and it is less than one year away. Ensure your organization understands and leverages the new features of GDSN v3.1 and take the necessary steps to prepare for a successful and seamless transition. ◆

Angela Fernandez is the vice president of retail grocery and foodservice at GS1 US.

Always Supplying Advanced Flexible Excellence

likely be at the forefront of the GDSN major release. However, it is beneficial for supply chain management, food safety and sales roles to be aware of the coming changes too. If it has not already been discussed internally, now is the time to formulate a plan to prepare for the transition based on your company’s specific data needs. Business processes internally and between trading partners may need to be changed prior to May 6, during the transition and after it is implemented. Beginning on May 6, 2016, GDSN will turn off the current version (2.8) and begin transitioning to the new version (3.1). During the transition time, the network will be inaccessible for an estimated five or six days. Business needs to continue as usual during the transition, so discuss with your trading partners now how you will exchange product data and handle new item setups during the transition. Set aside a budget. Determining a budget for the major release will vary by company, but standards experts estimate that the transition will cost a fraction of the initial costs experienced when the company first implemented GDSN. The budget should cover tasks such as data mapping, changes to the IT structure, changes to business processes for collecting data and other setup tasks in accordance with the new standards. Don’t do it alone. GS1certified data pools are already preparing for the GDSN major release transition. Contact your representative or select a data pool now - companies will be affected in different ways based on their size or their current GDSN usage. They will have impact documents ready for your review and can delve into each of the changes to evaluate how far you have to go to be ready for the transition. If you are just beginning to establish GDSN in your orga-

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FOOD LOGISTICS

• AUGUST 2015

8/3/15 1:30 PM

Temperature Control:

3 P L s

The Ongoing Quest In The Food Supply Chain Technologies create options ranging from satellite-based tracking to new refrigerants.

BY ELLIOT MARAS he global cold chain continues to expand at a rapid pace, forcing transportation and logistics providers to become experts on the fast-changing field of temperature control technology. In the U.S., shippers, carriers and 3PLs are keeping tabs on the FDA’s pending temperature control regulations. But government regulations are not the only factor driving change. As the cover story on page 18 notes, the food supply chain has become increasingly global in recent years. And as the supply chain expands, so does the potential for lapses in temperature control. In addition, carrier capacity has hit an all-time low, creating concern about product quality assurance. Much of the innovation taking place in reefers and trailers today focuses on temperature control. Fleet managers agree the Food Safety Modernization Act (FSMA) requirements that address temperature monitoring, while not yet final, have created a lot of industry discussion on this topic. While pending regulations have heightened concern about temperature monitoring, this is only one aspect of the overriding goal of achieving temperature control and quality assurance in the food and beverage supply chain. Transportation decision makers are finding a variety of solutions on the market. These include tracking of assets in transit, temperature tracking, container access control, package atmosphere control, sustainable refrigerants, thermal quilts and more. 28

AUGUST 2015

Higher quality truck bodies help Feesers Inc., a Harrisburg, Pa.-based foodservice distributor serving six East Coast states, has found the new Alpine truck bodies improve insulation and reliability for hauling perishable foods. The 26-foot Alpine truck body, a collaborative effort between Chicago, Ill.-based Great Dane Inc. and Rice Lake, Wis.-based Johnson Refrigerated Truck Bodies, also provides

“It’s just better built,” he says. Feeser is currently using two of the Alpine body’s four temperature zones — frozen and refrigerated — but Herr appreciates the flexibility that four temperature zones provides.

Telematics offers more options More wide-scale use of telematics is helping refrigerated fleets avert load loss by assuring refrigeration units have enough fuel and are set correctly and running properly throughout a trip. Fleets can remotely monitor and control refrigeration. Control examples include tasks such as starting the unit, selecting temperature set points, switching between continuous and start-stop operating modes, defrosting units, clearing alarms or running

Carrier Transicold’s NaturLINE uses natural refrigerant carbon dioxide, which can lower carbon emissions by 28 percent compared to previous systems,

• FOOD LOGISTICS

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four temperature zones, says Bob Herr, fleet manager. While Feeser was initially concerned about meeting the FDA’s pending temperature control requirements — the truck bodies were engineered specifically to meet more stringent food safety rules — Herr has found other benefits. The Alpine box has high-quality construction, which better ensures thermal efficiency. In addition, the truck body bolts to the side of the chassis with no wood between the chassis and the body, while the foaming ensures void-free insulation and a high level of thermal efficiency. Because of the truck body’s construction quality, Herr feels he doesn’t have to worry about keeping the J-bolts tight like he did with his previous boxes.

www.foodlogistics.com

8/3/15 3:15 PM

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FSMA: Temperature And Sanitation Requirements Uncertain

upply chain companies may have to deploy more temperature monitoring and sanitation tools if certain proposed requirements within the U.S. Food Safety Modernization Act (FSMA) become law. Bud Rodowick, manager of fleet performance at Thermo King, says under the FSMA’s proposed Sanitary Transportation of Human and Animal Food rule, shippers must specify the sanitary requirements for vehicles carrying food and the temperatures that must be maintained. It is not certain which products will require continuous temperature monitoring. Nor is it clear if the shipper will have to monitor the air temperature of the container or the product temperature. Sanitary requirements for transportation equipment are also uncertain, Rodowick says. Under the proposed rule, a shipper must specify all necessary sanitary requirements for the carrier’s vehicle and transportation equipment, including design requirements and cleaning procedures to ensure the vehicle is in appropriate sanitary condition for transporting food. Transportation equipment not only applies to vehicles, he says, but to pallets, bins and fittings. “I think that the new law is a certainty,” says Brian Fues, general manager, Penske Logistics. “What we don’t really know are all of the requirements and implementation dates. Many shippers will struggle to find capable carriers who have the systems and adequately maintained equipment necessary to comply with the new rules.” Fues thinks the use of electronic temperature monitoring will grow. “While some may try to comply with written temperature logs, I think the industry best practice will be electronic monitoring controls. Similar to driver’s logs, I believe that electronic logs will be and should be mandatory. We’re in a technology-filled world, so there is no reason that continuous monitoring should be a challenge or major expense for any shipper. Luckily, systems from companies like ibright, Sensitech and PLM Trailer’s ColdLink are easy solutions to implement, and they are affordable.” ◆

diagnostic routines. Carrier Transicold’s APX control system for trailers offers the ability to display data recorder trip graphs, providing a visual indicator of conditions within the trailer throughout a delivery run, says Patrick McDonald, product manager for trailer products, Carrier Transicold Truck, Trailer, Rail – Americas, based in Athens, Ga. The company’s DataTrak protocol enables the APX control to be used with third-party telematics systems. Refrigerated operations that equip their fleets to use telematics can communicate with their Carrier Transicold refrigeration systems. Remote data monitoring 30

AUGUST 2015

Carrier Transicold’s APX control system for trailers can display data recorder trip graphs.

may also simplify centralized recordkeeping for Hazard Analysis and Critical Control Points (HACCP) auditing and may possibly play an important role for compliance with the FSMA, McDonald says.

• FOOD LOGISTICS

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The ColdLInk from PLM Trailer allows both fixed and autonomous configuration for controlling and monitoring truck activity.

1. Fixed Configuration

Satellite tracking supports temperature control The ColdLink satellite tracking tool from PLM Trailer will allow a fleet manager to control and monitor temperature and other activity for an entire fleet remotely, says Don Durm, director of strategic solutions for the Montvale, N.J.-based company. A computer on the vehicle’s refrigeration unit interfaces with the Carrier or Thermo King unit’s microprocessor. “You can actively participate in the supply chain in real time,” Durm says. The ColdLink allows a manager to “geofence” certain locations to send alerts or potentially change the operational parameters of the refrigeration system once the unit has either entered or exited the area of interest. ColdLink also tracks driving behavior, engine activity and route activity. The fleet manager can access reports over the Internet. Data includes refrigeration status, location, fuel level, movement and air temperature. The system can also probe product temperature. There is no longer a need to do a “micro download”

2. Autonomous Configuration

after a load has been rejected, Durm says. The shipper can set their individual parameters as to temperature profiles, door opening or route compliance. If there is a violation, ColdLink notifies the shipper in real time and gives them the ability to make changes from their desktop. Should a violation occur, such as if a driver changes the temperature, the fleet manager can change it back. Should he or she receive an alarm code on the unit, the fleet manager can clear it and move forward without involving the driver.

Temperature control on intermodal containers NFI Industries, the Cherry Hill, N.J.-based supply chain solutions provider, introduced several temperature monitoring features to its rapidly-expanding 200-container intermodal business. Don Aiken, senior vice president of intermodal, says Bloomington, Minn.based Thermo King containers come with sensors that provide NFI with real-time data to monitor the health of the refrigeration unit. Thermo King’s cloud-based monitoring allows the shipper and the receiver to track the internal temperature in real time throughout the load. In addition to tracking conwww.foodlogistics.com

8/3/15 3:15 PM

tainer temperature, the system monitors temperature for the engine RPMs (revolutions per minute), coolant oil, diesel output, and generator output as well as other critical systems. There are sensors that track attempts to open the containers, ensuring product integrity. “This information is pushed to us at regular intervals throughout the transit,” Aiken says. While many customers choose not to monitor in real time, Aiken says there is an electronic log available after a load completes. Produce companies regularly track product temperature, Aiken says. They also ensure product temperature at loading and unloading by pulping the product with a thermometer at multiple locations in the container.

Refrigerants reduce greenhouse gas Some carriers are introducing refrigeration units designed to reduce greenhouse gas emissions. Thermo King this year began offering North American customers new options for trailer and self-powered products with lower global warming potential (GWP), pending approval by the U.S. Environmental Protection Agency under the Significant New Alternatives Policy program. These new trailer and selfpowered truck products use a new refrigerant that reduces GWP by around half compared to refrigerants that are currently being used for these applications. Thermo King, in partnership with the Wilmington, Del.-based refrigerant manufacturer, Chemours, selected Opteon XP44 (R-452A) for this alternative offering of transport refrigeration products. Thermo King will continue to offer its transport customers its current line of transport refrigeration products until customers are ready to transition. “Our intent has always been www.foodlogistics.com

FLOG0815_28-33_3PL EM_ES_LS.indd 31

to offer operators a choice of how and when to lower their GHG footprint without compromising the product performance they expect from Thermo King,” says Ray Pittard, president of Thermo King. In 2014, the U.S. and China agreed to work together to cut the consumption and production of HFCs, and G-20 leaders followed by expressing their own support for an HFC refrigerant reduction. Carrier Transicold is working on an OTR application of its NaturaLINE refrigeration system for marine transport that uses the natural refrigerant CO2 instead of a synthetic refrigerant. CO2 has a GWP of one compared to R-134a, which has a GWP of 1,430 and is typically used in container refrigeration, and R-404A, which has a GWP of 3,922 and is typically used in truck and trailer systems. “By offering an energyefficient system using a natural refrigerant that delivers high refrigeration capacities, we provide the shipping industry with a viable hedge against procurement challenges or cost increases related to phase outs of higher GWP synthetic refrigerants, which have been targeted by multiple governments and environmental agencies for a variety of applications,” says David Appel, president of Carrier Tran-

sicold & Refrigeration Systems. Appel says CO2 is the only natural refrigerant that is neither flammable nor toxic, is available worldwide, is costeffective and requires no special disposal. “Carrier has extensive experience with CO2, applying the natural refrigerant safely and reliably in CO2OLtec commercial refrigeration systems, which are now used in nearly 1,500 European supermarkets, and successfully trialed in road transport refrigeration systems as well,” Appel says.

Secure trailers and containers Q Products & Services, the Hazel Crest, Ill.-based provider of passive temperature protection products, has a security solution called Power In–Lock that mounts to trailer and container doors that secures the cargo from the inside. It can work on both roll-down or swing-out doors. There is an electronic seal that verifies opening and closing. “We know there is a need for that type of solution, given all the food safety laws, specifically the (FSMA) sanitary transport act,” says Kevin Lynch, national account manager for food and grocery. “If a seal is broken, you can verify if the door was not open in a given time frame, ensuring that tampering did not occur to the cargo.”

Q Products & Services also has a wireless remote monitoring software solution called TempVision that trailers can use. This allows a vehicle to download its temperature data when it arrives to its destination. The data can download via Wi-Fi or radio frequency.

Controlled atmosphere technology evolves For overseas shipping, where transit times for perishables can be several weeks, controlled atmosphere technologies are helping to maintain quality of perishables beyond what refrigeration alone can do, according to Edward Goh, marketing director for global and container products at Carrier Transicold. This enables longer duration transport. Carrier Transicold’s XtendFRESH system controls oxygen and carbon dioxide levels and removes ethylene, a hormone produced by perishables that will accelerate unwanted ripening if left unchecked. The system has a self-regenerating, activated carbon scrubber assembly that removes ethylene and CO2 created by the ripening processes occurring inside the container. As O2 (oxygen) is consumed by ripening produce, automated, on-demand fresh-air ventilation helps maintain the optimum O2 level for the specific cargo inside.

NFI intermodal vehicles have Thermo King containers with sensors that provide NFI with real-time data to monitor the health of the refrigeration unit.

FOOD LOGISTICS

• AUGUST 2015

8/3/15 3:15 PM

By slowing ripening, XtendFRESH lengthens the amount of time produce can spend in refrigerated transit — by more than double in some cases. For example, bananas can be shipped for up to eight weeks rather than four, and beans for up to four weeks rather than 10 days. Not all temperature control innovations are highly technical, however. Price Chopper, the Schenectady, N.Y.-based supermarket chain, has been testing the Cap & Wrap PalletQuilt from Q Products & Services to haul ice cream and frozen foods on refrigerated delivery trucks. The company delivers most of its frozen product in dedicated frozen trailers. By wrapping frozen pallets with these thermal quilts and shipping them with perishables, they are able to save the extra trailer delivery to the store. The quilts maintain the quality of

Anthony Dellumo at Q Products & Services readies a quilt to go on a refrigerated trailer to haul frozen product.

the product throughout the delivery process. “It’s a passive form of protection,” explains Lynch at Q Products & Services. “It’s not designed to eliminate multitemp trailers,” but rather it gives a grocery retailer flexibility. Delivering frozen product to the stores is a challenge for grocery retailers, and this simply provides another viable option for certain routes. Retailers have the option of

NEW TRANSPORTATION & DISTRIBUTION REGULATIONS START SOON!

using bulkheads for delivering product. But compared to quilts, bulkheads take up more space and are cumbersome when unloading the reefer, especially on multi-stop deliveries, Lynch says. Q Products designed the Cap & Wrap PalletQuilt for the grocery store distribution application. They are height adjustable to accommodate different size pallets. Elmhurst, Ill.-based Randall Manufacturing introduced an elevated platform that provides drivers with improved side door delivery. This allows efficient mingling of dry, refrigerated and frozen goods on one trailer. In combination with a bulkhead, this platform can eliminate the need for a freezer door, says Chuck Carey, vice president of sales. The platform elevates to the trailer floor without the use of a transition plate, providing full use of the area. The 48-inch by

52-inch platform space has two purposes: a first-stop loading position, enabling the trailer to be fully cubed; and an area to safely transition heavy loads from the platform to the walkramp. In addition, the elevated platform provides drivers with the flexibility of positioning the walkramp on the platform either parallel or perpendicular to the trailer. This innovation increases productivity and safety as well as increases revenue potential per trailer. The result is increased productivity and safety as well as increased revenue potential per trailer.

More on the way In the meantime, more temperature control solutions are in development. “Electric standby” provides the ability to plug parked truck or trailer units into electric power receptacles, enabling the refrigeration systems to run with their diesel engines shut off, says McDonald at Carrier Transicold. This conserves fuel and also eliminates the noise and emissions associated with running the diesel engine. As the f&b supply chain expands, shippers have more concerns about temperature control. Fortunately, they also have more options. ◆

For more information:

Call for a consultation with the experts at PLM Trailer Leasing, the only company with nationwide locations dedicated exclusively to the leasing, rental, maintenance and fleet management of refrigerated trailers in the Cold Supply Chain.

AUGUST 2015

WWW.PLMTRAILER.COM 1- 877- RENT - PLM (736 - 8756)

• FOOD LOGISTICS

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CARRIER TRANSICOLD, 800-227-7437, www.carrier.com CHEMOURS CO., 302-773-1000, www.chemours.com GREAT DANE INC., 773-254-5533, www.greatdanetrailers.com JOHNSON REFRIGERATED TRUCK BODIES, 800-922-8360, www.johnsontruckbodies.com IBRIGHT, 64-9-379-7211, www.internationaltelematics.com PENSKE, 888-236-3560, www.Penske.com PLM TRAILER, 877-736-8756, www.plmtrailer.com Q PRODUCTS & SERVICES, 708-331-0094, www.qsales.com RANDALL MANUFACTURING, 630-782-0001, www.randallmfg.com SENSITECH, 800-843-8367, www.sensitech.com THERMO KING, 952-887-2200, www.thermoking.com www.foodlogistics.com

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APPLICATIONS n

Temperature control

Heat containment

Humidity control

Dust, odor or fume containment

Sound attenuation

Cross-contamination prevention

Blast freezers

Wash down environments

Loading dock enclosure

FLOG0815_28-33_3PL EM_ES_LS.indd 33

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SPECIAL FEATURE

Food Logistics’ 2015 Top 3PL & Cold Storage Providers More providers are expanding their portfolio of services to meet industry demands. BY EDITORIAL STAFF

his year’s list of providers in the third-party logistics and cold storage sectors reveals a noticeable trend. Specifically, more providers are adding new services to their portfolios to meet industry demands, which range from compliance with food safety and transportation regulations to customer driven requirements for real-time tracking of cargo and temperature-monitoring. Moreover, these same 3PLs and cold storage providers are improving their existing services to achieve more accuracy, improved efficiencies and cost reductions. Ultimately, transportation and logistics in the food supply chain—including perishables—requires a commitment on the part of 3PLs and cold storage providers to continually invest in their own operations to meet the needs of their customers’ operations. Congratulations to the companies earning a spot on our 2015 Top 3PL & Cold Storage Providers list.

TOP

Company: Allen Lund Company,

Company: CaseStack, Inc.,

Web site: www.allenlund.com Year founded: 1976 Number of employees: 436 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Non-asset Worth noting: ALC Logistics offers customized transportation management system (TMS) solutions. Each one of our TMS installations is a separate instance on the cloud in your company’s name. Our TMS is built to handle the most complicated refrigerated loads, but is effective for any commodity. Our pricing includes unlimited users and complete support from installation to user training. See for yourself how a customized solution makes all the difference. Call us for a demo 800-282-3246.

Web site: www.casestack.com Year founded: 1999 Number of employees: 200-250 Area(s) served: North America (U.S., Canada and Mexico) and International Asset/Non-asset: Non-asset Worth noting: Thousands of suppliers turn to CaseStack for innovative consolidation programs, efficient warehousing systems and streamlined transportation management, all of which are centered on the company’s proprietary, real-time inventory and order technology. This enables customers to realize cost savings and achieve the performance levels of their larger competitors for less investment.

La Canada, Calif.

Company: Burris Logistics, Milford, Del. Web site: www.burrislogistics.com Year founded: 1925 Number of employees: 1,786 Area(s) served: U.S. Asset/Non-asset: Both Worth noting: A high-quality provider of customized supply chain solutions and custom retail distribution. Enjoy all of the benefits of self distribution with none of the headaches. The Burris family’s commitment to exceptional customer service goes back five generations. Our company promise of “integrity delivered” will remain an integral part of everything we do today—and in all the years to come. You have Donnie Burris’ guarantee.

AUGUST 2015

• FOOD LOGISTICS

FLOG0815_34-47_Top3PL LS_ES_EM.indd 34

Santa Monica, Calif.

Company: C.H. Robinson, Eden Prairie, Minn. Web site: www.chrobinson.com Year founded: 1905 Number of employees: 12,632 Area(s) served: International Asset/Non-asset: Both Worth noting: C.H. Robinson remains one of the world’s largest third-party logistics providers having managed 14.3 million shipments in 2014 for customers of all sizes around the world. The company has been named to the Fortune 500 list since 2002, named to Fortune’s “World’s Most Admired Companies” list, received the First Leaf award from Green Freight Europe in 2015, was named Driscoll’s 2014 U.S. Carrier of the Year, and presented with Kraft Foods’ 2014 Partnership Award.

Company: Choptank Transport,

Preston, Md.

Web site: www.choptanktransport.com Year founded: 2000 Number of employees: 214 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Non-asset Worth noting: Choptank Transport is a 3PL that shippers want to work with. The company has been named a Top Workplace by The Washington Post for two years in a row and has seen exceptional growth because of its reliability and outstanding customer service. Our mission statement says it best: “By providing an exceptional work environment, out team will be better able to provide superior service to our customers offering effective and efficient freight management solutions.” Company: DSC Logistics,

Des Plaines, Ill.

Web site: www.dsclogistics.com Year founded: 1960 Number of employees: 2,900 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Both Worth noting: With over 50 years’ experience in the food and CPG industries, DSC Logistics is a leader in transforming logistics and supply chain management into a critical business strategy based on collaborative partnerships, innovative thinking, and high-performance operations. DSC achieves the business goals of Fortune 500 and other dynamic companies by designing, integrating, managing and adapting customized supply chain solutions. As a Lead Logistics Partner (LLP) and third-party logistics (3PL) provider, DSC delivers value by reducing total system costs, optimizing business processes, facilitating growth and change, and maximizing the potential of the supply chain. DSC is a certified womanowned business, and is named annually as a Top 3PL and Top Green Supply Chain Partner by multiple trade journals. Company: DSW Distribution Centers, Inc.,

Rancho Cucamonga, Calif.

Web site: www.dswdist.com Year founded: 1973 Number of employees: 50 Area(s) served: U.S. Asset/Non-asset: Asset Worth noting: DSW Distribution Centers, Inc. is a 42-year-old, privately-owned ,multi-temperature and multi-licensed warehousing and distribution company specializing in food and pharmaceutical-grade supply chain services. DSW is Organic Certified, holds two CA-ABC Alcoholic Beverage Licenses, and several State Board of Pharmacy Licenses. DSW offers Retailer Compliance Programs, International Language Labeling and many “extreme” value-added services, including Internet shopping cart fulfillment and 24/7 on-line reports. www.foodlogistics.com

8/14/15 8:21 AM

UNIVERSAL LUMPERS INC.

h o use

ca r r i

m per

Your Lumping And Logistics Partner universallumpers.com 1-888-458-6737 x1104 Connect with us

FLOG0815_34-47_Top3PL LS_ES_EM.indd 35

8/14/15 8:21 AM

Acme Distribution Centers, Inc.

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Blast Freez ing Cross Dock Fulfillm ing en Inven t tory/C ost Ac Inven count tory M ing anage Multiment vendo r C Order o Assem nsolidatio n bly Pick/ Pack Assem Privat b ly e Ref Public . Whse. Ref Rever . Whse. se Lo gistic USDA s - Re /FDA call Inspe Vendo r Man ction a g ed Inv Wareh entor ous y Other ing/Dist. M gmt.

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WHSE/COLD

Rail/T ruck Trans Refrig load erated Truck Truck ing load Truck load B roker Other age

Air Ca rgo Bulk Contin uous Move Custo s ms Br okera Dedic ge ated C ontra Direc ct Car t Stor riage e Deli Draya very g e Se r v ic e Fleet Leasin s g Freigh t Forw ardin Fuel S g aving s Prog Full Se ram rvice Interm Managed Tran sportati odal on LTL Multivend Ocean or Consoli dation Rail

3PL SERVICES

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www.acmedistribution.com

Allen Lund Company www.allenlund.com

Atlanta Bonded Warehouse Corporation

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POP Display Assembly

TMS software; Logistics Consulting; RFP

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Co-packaging

www.atlantabonded.com

Blue Ribbon Transport

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www.blueribbontransport.com

Burris Logistics

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Cardinal Logistics Management

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Produce repacking

Yard Mgmt.

www.cardlog.com

CaseStack, Inc.

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Choptank Transport www.choptanktransport.com

C.H. Robinson

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Classic Transportation & Warehousing

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Cloverleaf Cold Storage www.cloverleaf.com

Cold Storage Solutions

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Two CMEapproved facilities and C-TPAT certified.

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Commercial Warehousing Inc. www.com-

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mercialwarehousing.com

Coyote Logistics

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DB Schenker www.dbschenkerusa.com

DSC Logistics www.dsclogistics.com

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DSW Distribution Centers, Inc.

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East Coast Warehouse & Distribution Corp.

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Echo Global Logistics

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www.echo.com

Flagler Global Logistics www.flaglergl.com

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Flagship Logistics Group www.flagship-

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foodgroup.com

foodcareplus

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www.foodcareplus.com

FST Logistics www.fstusa.com

FW Warehousing www.FWwarehousing.com

GENCO, A FedEx Company

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www.genco.com

AUGUST 2015

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• FOOD LOGISTICS

FLOG0815_34-47_Top3PL LS_ES_EM.indd 36

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Packaging, POS

www.foodlogistics.com

8/14/15 8:21 AM

NATIONAL REACH, LOCAL CONNECTIONS. ENDTOEND COLD CHAIN SOLUTIONS Lineage Logistics is a warehousing and logistics partner committed to delivering sophisticated, customized, and dependable cold chain solutions to leading food, retail, agriculture and distribution companies. We serve customers who put a premium on excellence and reliability to ensure our nation’s food supply is handled, stored and delivered safely and securely through the entire supply chain.

Public Warehousing

Port-Centric Warehousing

Dedicated Distribution Facilities

Dry Warehousing

On-Site Food Processing

Transportation

Logistics Consulting

Manufacturing

High-Pressure Processing

Re-Distribution

Packaging

Customs Brokerage

Alab Alabama

Illinois

Maryland

North Carolina

Tennessee

California

Iowa

Mississippi

Ohio

Texas

Colorado

Kansas

Missouri

Oregon

Utah

Georgia

Kentucky

Nebraska

Pennsylvania

Virginia Washington

Learn more at lineagelogistics.com or call 1-800-678-7271

FLOG0815_34-47_Top3PL LS_ES_EM.indd 37

8/14/15 8:21 AM

GRUPO PORTEO S.A. DE C.V.

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www.grupoporteo.com.MX

H&M Bay

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www.hmbayinc.com

Hanover Logistics www.hanoverlogistics.com

Hanson Logistics www.hansonlogistics.com

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Helmsman Freight Solutions www.helms-

Cold chain logistics

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Henningsen Cold Storage

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www.henningsen.com

Inmar, Inc.

Extensive DC services for product return management

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www.inmar.com

Jarrett Logistics Systems, Inc.

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JTS (Johanson Transportation Service) www.johansontrans.com

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Kan-Haul

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Kanban Logistics

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www.kanbanlogistics.com

Kane Is Able www.kaneisable.com

Kenco

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KTI, LTD. www.ktiltd.com

L & M Transportation Services Inc.

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Lakeside Refrigerated Services

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Legion Logistics, LLC

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Lineage Logistics

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McCook Cold Storage

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Midwest Refrigerated Services

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MCS Logistics

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MTC Logisitcs

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Murphy Warehouse www.murphywarehouse.com

AUGUST 2015

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FTZ; Customs Exam Station, Midwest Int'l Logistics Center

www.foodlogistics.com

8/14/15 8:21 AM

DELAYS CAN CHANGE EVERYTHING. That’s why Penske Logistics has customized supply chain solutions to help keep your business moving forward. Visit gopenske.com or call 844-868-0818 to learn more.

FLOG0815_34-47_Top3PL LS_ES_EM.indd 39

8/14/15 8:21 AM

Network Global Logistics www.nglog.com

Newport-St. Paul Cold Storage Co.

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www.newportcold.com

Next Generation Logistics

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NFI www.nfiindustries.com

Nova Cold Storage

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Osramii www.osramii.com

Overseas Cargo, Inc. (ShipOCI)

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Pam Young & Company, Inc. www.pamyoung.com

Penske Logistics

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Port Jersey Logistics www.portjersey.com

Redwood Logistics www.redwoodlogistics.com

ReTrans Precision Logistics

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Specializing in produce transport

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Reverse Solutions, LLC

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RLS Logistics

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Ruan Transportation Management Systems

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Ryder System, Inc.

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Saddle Creek Logistics Services

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Seaonus www.seanus.com

Service First Logistics Incorporated

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Time Definite Services Transportation, LLC www.timedefinite.com

AUGUST 2015

• FOOD LOGISTICS

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White glove delivery

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8/14/15 8:22 AM

Sometimes the best way to use resources...

is to conserve them.

Five of the many ways we’re reducing our environmental impact At DSC Logistics, we are: • Reducing fuel usage and carbon emissions with network modeling, shipment consolidation and transportation collaboration • Saving water with green-scrubbers that use 70% less water to clean our Logistics Centers • Recycling paper, plastics , electronics, batteries, and other materials

• Decreasing paper and packaging waste with an innovative machine that designs each container to fit its contents precisely • Measuring consumption of water, electricity, propane and natural gas to monitor and drive improvement DSC launched our network-wide sustainability program in 2009 and since then, we’ve won 19 awards for initiatives that conserve resources and reduce costs.

We think greener!

Lead Logistics Partner • Third-Party Logistics • Supply Chain Analysis & Design Network Management • Logistics Center Management • Transportation Management Value-Added Services • Business Process Integration • Supply Chain Visibility Dynamic Supply Chain Management

www.dsclogistics.com 1.847.635.4952

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8/14/15 8:22 AM

Company: FST Logistics,

an A+ rating with the Fresno (CA) Better Business Bureau and have been a BBB Accredited Business since October 1990.

Columbus, Ohio

Web site: www.fstusa.com Year founded: 1991 Number of employees: 230 Area(s) served: U.S. Asset/Non-asset: Both Worth noting: FST Logistics has completed its first year as an Employee Owned Company (ESOP). This creates an ownership atmosphere where employees know they have a stake in the business and a direct impact on their future. This flows over into day-to-day operations when employee owners are working with customers, co-owners and vendors while performing their duties with “ownership thinking.” This has made us a better company for employees and our business partners.

Company: Kenco,

Chattanooga, Tenn.

TOP

Company: Henningsen Cold Storage, Hillsboro, Ore. Web site: www.henningsen.com Year founded: 1923 Number of employees: 330 Area(s) served: National (entire U.S.) Asset/Non-asset: Non-asset Worth noting: Henningsen Cold Storage is a 5th generation family-owned cold logistics provider founded in 1923. No matter which warehouse you walk into, you will have the same consistent experience, friendly people, hot coffee and a smile. Company: H&M Bay, Inc.,

Federalsburg, Md.

Web site: www.hmbayinc.com Year founded: 1982 Number of employees: 553 Area(s) served: U.S. Asset/Non-asset: Non-asset Worth noting: H&M Bay is one of the country’s premier logistics providers for LTL refrigerated and frozen commodities. Consolidation centers strategically located nationwide, along with a host of Webbased systems for ordering and tracking, help you manage all your shipping needs. When keeping it cold counts, contact H&M Bay. Company: JTS (Johanson

Transportation Service), Fresno, Calif. Web site: www.johansontrans.com Year founded: 1971 Number of employees: 90 Area(s) served: North America (U.S., Canada and Mexico) and International Asset/Non-asset: Non-asset Worth noting: JTS is continually customizing and expanding our technology offerings to meet our carrier, shipper and receivers’ business requirements. We feel strongly that this, plus our commitment to applying ethically sound business principles to our operations and customer service, sets us apart in the 3PL market. We have

AUGUST 2015

• FOOD LOGISTICS

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Web site: www.kencogroup.com Year founded: 1950 Number of employees: 3,800 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Both Worth noting: Kenco’s integrated logistics platform focuses on commitment to service and cultural alignment, while providing vertically integrated and engineered solutions with its partners. Kenco is also a U.S. and Canada focused company with the capabilities of fulfilling supplier diversity requirements. We are very proud to be the largest woman-owned, third-party logistics company in the U.S. Company: Lineage Logistics, Colton, Calif. Web site: www.lineagelogistics.com Year founded: 2007 Number of employees: 4,000 Area(s) served: U.S. Asset/Non-asset: Asset Worth noting: Completing the acquisition of Columbia Colstor, Dreisbach Enterprises and Oneida Cold Storage has allowed Lineage to expand its national cold storage footprint to over 600 million cubic feet with a facility network of 111 facilities in 21 states. Company: Metro Park Warehouses,

Kansas City, Mo.

Web site: www.mpwus.com Year founded: 1970 Number of employees: 175 Area(s) served: Midwest Asset/Non-asset: Asset Worth noting: Metro Park Warehouses Inc. boasts licensed medical, pharmaceutical and alcohol distribution, call center services, heat tunnel shrink wrapping and bundling, display building, kitting, labeling and packaging. Company: Penske Logistics,

Reading, Pa.

Web site: www.penskelogistics.com Year founded: 1969 Number of employees: 13,000 Area(s) served: North America (U.S., Canada and Mexico) and International Asset/Non-asset: Both Worth noting: The parent company, Penske Truck Leasing, has won U.S. EPA’s SmartWay Affiliate Challenge Award for the third straight year; Penske Logistics acquired Transfreight North America.

www.foodlogistics.com

8/14/15 8:22 AM

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Total Quality Logistics

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www.tql.com

Total Transportation Network www.totaltrans-

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Pre-audit freight bill payment

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TransCold Distribution Ltd. www.transcold.com

Transplace

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Transportation Insight www.transportationinsight.com

Transportation One LLC www.transportationone.com

Trinity Logistics www.trinitylogistics.com

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Universal Lumpers, Inc. www.universallumpers.com

Unloading Service Provider; PayLump truck unloading software

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Company: ReTrans Precision Logistics, Memphis, Tenn. Web site: www.re-trans.com Year founded: 2002 Number of employees: 500+ Area(s) served: North America (U.S., Canada and Mexico) and International Asset/Non-asset: Non-asset Worth noting: ReTrans is one of the top and only 3PL management companies of its kind. We provide customized service for each of our customer’s needs and many different forms of analysis and reporting. ReTrans has been growing at a rate of 20 percent each year and managing $600 million in freight expenditures. Company: RLS Logistics,

Newfield, N.J.

Web site: www.rlslogistics.com Year founded: 1968 Number of employees: 200 Area(s) served: National (entire U.S.) Asset/Non-asset: Both Worth noting: RLS Logistics continues to provide customers with new service offerings. We continue to provide fast reliable temperature-controlled LTL service from the Northeast, servicing all 48 states. Additionally, RLS Logistics has announced a refrigerated-only program to handle those temperature- and timesensitive shipments. Our warehouse locations continue our green initiative. We have just been approved for a new solar project at our company headquarters

AUGUST 2015

• FOOD LOGISTICS

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in Newfield, N.J. Our goal is to have 90 percent of all power needed to run the facility generated by solar power. RLS opened its fourth temperature-controlled logistics center in Vineland, N.J. recently. Company: Ryder System, Inc.,

Miami, Fla.

Web site: www.ryder.com Year founded: 1933 Number of employees: 29,000 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Both Worth noting: Ryder works with nine of the 10 top food and beverage companies in the U.S. Thousands of customers rely on Ryder’s experience in transportation and logistics. The company offers a network of maintenance facilities with expert refrigeration technicians and warehousing space. Company: Star Distribution Systems, Inc., Palm City, Fla. Web site: www.stardistribution.us Year founded: 1892 Number of employees: 250 Area(s) served: U.S. Asset/Non-asset: Both Worth noting: Year after year, Star Distribution Systems, Inc. is touted as Florida’s premier third party logistics provider. Our core focus is on collaborative distribution and consolidated LTL transportation for over 125 valued clients. That said, we have the awards to

www.foodlogistics.com

8/14/15 8:22 AM

US Perishables

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Vantix Logistics

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Vestra Logistics

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Weber Logistics

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Werner Enterprises/ Werner Global Logistics

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TOP 90

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Wheels International www.wheelsgroup.com

Witte Bros. Exchange, Inc. www.wittebros.com

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back it up: Ocean Spray Rookie of the Year; six consecutive Bell Carter Foods Service Provider of the Year; Nestle Waters Regional Carrier of the Year; and recognized as one of Sun Maid Growers of California “Key Partners.” Company: Total Transportation Network, Northfield, Ill. Web site: www. totaltransportationnetwork.com Year founded: 2008 Number of employees: 17 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Non-asset Worth noting: Total Transportation Network is one of the fastest growing companies in Chicago. We have quality employees, which has truly allowed us to move increasingly high volumes and “sell a quality product” for our shippers. We work in a results-driven industry and we have never fallen short of getting those results day in and out. Our owners are very adamant to always bring forth the results and “no fail” attitude on each load we cover. Adding Fortune 100-500 customers is becoming a regular pattern and with the growing carrier/operations departments, we can surely continue to take on more. Company: Transportation Insight, Hickory, N.C. Web site: www.transportationinsight.com Year founded: 1999

www.foodlogistics.com

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Number of employees: 325 Area(s) served: North America (U.S., Canada and Mexico) and International Asset/Non-asset: Non-asset Worth noting: Transportation Insight is one of the largest and most experienced full-service 3PLs in North America, delivering bundled enterprise end-to-end logistics solutions. Services and solutions offered include carrier sourcing, robust transportation management system (TMS) technology, freight bill audit and payment services, supply chain analytics, reporting and Big Data solutions with interactive analytical tools, warehousing and LEAN consulting. Operating under a co-managed Logistics® model, the 3PL fosters continuous improvement activities throughout client supply chains through the implementation of its Extended LEAN® methodology. Company: Trinity Logistics,

Seaford, Del.

Web site: www.trinitylogistics.com Year founded: 1979 Number of employees: 260 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Non-asset Worth noting: Offering both freight brokerage and transportation management services, Trinity Logistics is one of the longest-standing major players in the transportation industry that specializes in serving the food industry.

THE PRIMARY CHOICE FOR ALL YOUR THIRD-PARTY LOGISTICS

 Asset Based 3PL  Temperature Controlled Warehousing and Transportation  Refrigerated and Frozen LTL  Dry, Refrigerated and Frozen TL  Expedited & Special Handling  Headquartered in Columbus, OH

www.fstlogistics.com | 800-758-4599 FOOD LOGISTICS

• AUGUST 2015

8/14/15 8:22 AM

Go green

Company: Triple T Transport,

Company: Veracity Logistics,

Web site: www.triplettransport.com Year founded: 1988 Number of employees: 70 Area(s) served: U.S. Asset/Non-asset: Non-asset Worth noting: At Triple T Transport, our #1 goal is customer satisfaction from the initial contact through delivery with detailed communication. We are 100 percent employee owned/operated and proud of the employees who handle your product with care and dedication. With over 25 years of service, we can put together a plan to make sure your product gets to your customer on time. It doesn’t matter what type of product you have—dry, refrigerated or frozen—we can service your needs.

Web site: www.veracitylogistics.com Year founded: 2012 Number of employees: 20+ Area(s) served: U.S. Asset/Non-asset: Both Worth noting: Veracity Logistics is strategically located in Clearfield, Utah, and Tolleson, Ariz., and provides food-grade warehousing, transportation and distribution 3PL services to food and nutraceutical manufacturers throughout the West and Southwest regions.

Lewis Center, Ohio

Clearfield, Utah

TOP

Company: Universal Lumpers, Inc., Tempe, Ariz. Web site: www.universallumpers.com Year founded: 1982 Number of employees: 500-1,000 Area(s) served: U.S. Asset/Non-asset: Asset Worth noting: By partnering with UL, you get over 30 years of industry-leading experience on your side! We’ve taken what was once a raw and undeveloped industry and transformed it into a structured, accountable, and standardized service — one focused on saving our clients time and money. Our commitment to quality in legal lumping has helped us build a solid reputation for dependable service, one focused on upholding warehouse, carrier, and vendor relationships. Most importantly, you’ll gain the peace of mind that comes with knowing your inbound operation is being managed by the most seasoned company in the industry. UL’s suite of services includes dispatch and on-call lumping; hostlers; pallet load-ups, repair and sorting & segregating; product inspection & QA; product recovery center (PRC) operations; sanitation scheduling assistance; temperature inspections; tote washing; truck receiving and freight shuttling.

Lower Costs Great news for your bottom line. There are more than 40 areas of savings when businesses switch from wood pallets to iGPS plastic platforms. This includes lower transport costs, less product damage and reduced equipment downtime. The new and stronger iGPS has reemerged as a driving market force with its unique Plastic Pallet Pooling System, that provides cutting edge, global supply chain solutions for some of the leading companies and manufacturers in the world.

Company: US Cold Storage,

Union City, Calif.

Web site: www.uscold.com Year founded: 1816 Number of employees: 2,400 Area(s) served: U.S. Asset/Non-asset: Asset Worth noting: USCS is the third largest PRW logistics provider in North America and totally committed to the frozen and refrigerated food industry, providing a full range of services. We are a preferred leader in temperature-controlled warehousing and logistics services, offering best-in-class service. In addition, USCS offers 35 strategically placed facilities in 12 states: CA, DE, FL, IL, IN, NE, NC, PA, TN, TX, UT and VA. “The Logistics Network that Works for You!”

To see more green for your company call 1(800) 884-0225, or visit:

www.igps.net

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AUGUST 2015

• FOOD LOGISTICS

Company: Vestra Logistics,

Cumming, Ga.

Web site: www.vestralogistics.com Year founded: 1997 Number of employees: 13 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Non-asset Worth noting: With over 20 years of industry experience, Vestra Logistics is a woman owned and operated 3PL, with a precedence for superior service and logistics coordination. Company: WSI (Warehouse Specialists, Inc.), Appleton, Wis. Web site: www.wsinc.com Year founded: 1966 Number of employees: 1,200 Area(s) served: North America (U.S., Canada and Mexico) Asset/Non-asset: Both Worth noting: RELIABILITY IS EVERYTHING. Three simple words. A power promise. For nearly 50 years, WSI has helped customers succeed with reliable, integrated, third-party logistics. We deliver tailored, end-to-end supply chain solutions designed to maximize operational efficiency, ensure reliable performance and minimize costs. That passion for excellence has built WSI into one of the nation’s largest privately-held 3PL providers, with an exceptionally high client retention rate. Company: Yusen Logistics (America), Inc., Secaucus, N.J. Web site: www.us-yusen-logistics.com Year founded: 1955 Number of employees: 2,647 Area(s) served: North America (U.S., Canada and Mexico) and International Asset/Non-asset: Non-asset Worth noting: Yusen Logistics (Americas) has more than four decades of experience working with food growers, manufacturers, suppliers and retailers to help them solve their unique supply chain requirements. Our customers include many of the top tier manufacturers in the food and beverage industry. Our services include: reefer; over-the-road; less-than-truckload; flow-through warehousing; and retail POS display management. We handle nearly a million dollars in food- and beveragerelated business each year.

www.foodlogistics.com

8/14/15 8:22 AM

Expect More From Your Reach Truck. Only from Jungheinrich® Introducing the new ETR series of pantograph reach trucks – the latest innovation from Jungheinrich. • Fastest lift speeds in the industry • Smooth, quiet ride • Intuitive controls • ProTrac® drive axle for greater stability • Robust mast with lift heights up to 450 inches • 400+ dealer locations in North America

Take a test drive: Put our German engineering to the test — and see firsthand how you can achieve more. www.jungheinrich-lift.com 1-877-543-6757

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FLOG0815_34-47_Top3PL LS_ES_EM.indd 47

8/14/15 8:22 AM

SECTOR REPORTS

WARE HOUS E : ROBOTICS & A GV S

How Will Tackle Changing F&B Demands As smaller SKU orders challenge the food supply chain, robots and automation have a role. BY ELLIOT MARAS

he expansion of goodsto-person picking in food and beverage (f&b) supply chain operations portends a bigger role for automated material handling systems, including more complex systems such as robots. Robots, specifically defined as machines that resemble humans and perform tasks on command, remain rare in f&b facilities in the U.S. But technology solutions continue to evolve, hastening robotic deployments.

Today’s robots are more precise in their movements and are directed by more robust software, allowing them to do more complex tasks. They are also becoming more affordable. The newest robots can meet the rising demand for logistics technology. These solutions include truck loading, unloading and mixed-case depalletizing. Robots help improve the operational effectiveness of warehouses by reducing injuries to workers, reducing product damage and limiting loss due to theft. While there are still few robots in f&b operations, the overall robot market continues to expand and observers believe f&b applications will be part of this growing market. Winter Green Research, based in Lexington, Mass., recently reported the global industrial logistics robotics market has increasingly diver48

AUGUST 2015

• A Swisslog Miniload sequences a case to a mixedcase palletizing robot, an example of robots working in tandem with automation.

sified and is poised to grow in every industry. The report specifically notes that logistics robots improve efficiency in food production.

Robots and automation: Is there a difference? When discussing robots, technology providers and their customers often use the term interchangeably with “automation.” While this has been true since industrial robots first deployed in the 1950s, the definitions have blurred as robotic and automation capabilities have both expanded over time. The purpose of this article is two-fold: 1) to update readers on opportunities for applying robots in the f&b supply chain and 2) to clarify the definitions of automation and robotic technologies. Food Logistics believes these terms are more useful when clearly defined. An AGV, for instance, can

• FOOD LOGISTICS

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be fitted with robotic arms to lift and move shelves. Calling the AGV a robot with this added capability therefore makes more sense than calling it a robot without it. To the extent that robots have been used in f&b, they have largely deployed in fulfillment and packaging in production operations, particularly in beverage manufacturing. For example, FANUC’s LR Mate 200iD/4SC robot equipped with its new iRVision 3DA/400 locates and picks randomly-oriented bottle caps from a bin in a beverage production facility. The sensor provides 3D location of the bottle caps in the bin. The robot then picks the bottle caps from the bin and places them in a second bin at high speeds. Robots combined with material handling equipment can build mixed pallets efficiently as e-commerce drives the

demand for smaller quantity orders. Amazon.com deployed robots in its e-commerce fulfillment centers this year. The company claims it has reduced the time it takes to pull an item from a shelf and place it in a box from 90 minutes to 15 minutes. Several robotic experts active in the f&b space think robotic technology will deploy in palletizing and depalletizing functions. They note that the need to move smaller quantities through the supply chain is driving the movement of case loads more than full pallet loads. “Swisslog and our customers have migrated from pallet handling systems to case handling systems,” says Brad Moore, vice president of AGV Pick for Switzerland-based Swisslog, a division of KUKA, a German robot maker. “More and more, we’re seeing the cases be the driver of the medium.” As SKU mixes increase in response to changing market demands, Moore sees robots playing a bigger role in warehousing and distribution. This is also a reason why more AGVs are being deployed www.foodlogistics.com

8/3/15 11:10 AM

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8/3/15 11:10 AM

• Giant

Eagle has found the vision guided vehicle with Seegrid’s vision navigation improves safety and saves time.

Giant Eagle Pioneers Vision Guided Vehicles In Putaway Operations

iant Eagle Inc., the Pittsburgh, Pa.-based supermarket chain, has deployed Seegrid and Raymond Corp. vision guided vehicles (VGVs) in their retail support centers. Giant Eagle has reduced manned travel from putaway by 20 to 30 percent by using VGVs.

“The cost effectiveness that the new system incorporates has allowed us to remain successful in an extremely competitive environment and bring value to our end customer,” says Joe Hurley, Giant Eagle’s senior vice president of distribution and logistics in a Seegrid case study. The VGVs have increased high-lift pallets per hour by 35 to 45 percent, delivering an average savings of 1.5 minutes per pallet hauled and reducing manned travel from putaway by 20 to 30 percent. The WMS notifies the high-lift operators to complete the putaway process once the product has been delivered to the aisles by the VGVs. There have been no accidents. ◆

in DCs, Moore says. In food DCs, they are being used primarily for mixed-case picking. The falling cost of AGVs is also supporting this change. Moore thinks further innovation is coming faster than many realize. AGVs will soon be equipped with lights that will allow them to self-verify picking accuracy. Swisslog has also deployed a robotic goods-to-person order picking system specifically designed for the intralogistics requirements of fulfilling e-commerce orders. In this scenario, product variability, delivery time and cost efficiency are daily challenges. The company has introduced the solution, called CarryPick, to Europe and the Far East. Matt Wicks, vice president of manufacturing systems at 50

AUGUST 2015

Intelligrated, a Mason, Ohiobased provider of automated material handling solutions, agrees that robotic depalletizers will help companies manage the growing need to manage smaller SKU quantities. Wicks also agrees the use of the term “robot” has changed as materials handling equipment has become more versatile. Many observers view shuttles that retrieve inventory from shelves as robots. Wicks considers a technology robotic if it manipulates objects such as products, boxes or pallets in a way that is more advanced than in the typical warehouse. Raad Asmaro, account manager at FANUC America, based in Rochester Hills, Mich., sees many of today’s AGVs as robots. He thinks the term increasingly fits AGVs as

• FOOD LOGISTICS

FLOG0815_48-51_Robotics.indd EM_ES_LS.indd 50

they perform more functions. ing more opportunities in the AGVs are no longer simply f&b sector. moving pallets from unloading The key advantage to colzones to storage areas or from laborative robots is their ability storage areas to loading docks. to perform a variety of tasks, as They are also handling more of opposed to the large, industrial the actual loading and unloadrobots used for high-speed, ing to and from trucks. repetitive motions. CollaboraAsmaro agrees that in the tive robots can roam free rather f&b sector, robots have been than being bolted to a single more active in production location, and have safety senoperations than distribution. sors that prevent them from But like other observers, he running into humans. says this is changing. FANUC’s Asmaro does not Some see AGVs’ advanced see collaborative robots taking navigation capabilities allowing the place of conventional ones. them to replace humans. Bryan Conventional robots, which Duncan, director of solution are faster and require protective sales at Wynright, based in Elk barriers with humans, will conGrove Village, Ill., says AGVs tinue to increase where speed is are gaining critical. the ability to In order discern, pick, for a robot place and to fully take report. As over the role it replaces of a picker, human activiit has to be ty, “that’s more capable not pure robotics,” • A Wynright robotic truck unonly of arm loader palletizes in a warehouse. Duncan says. and hand “You have takmanipulaen the place of a person that’s tion, but also object and pose doing that. The ‘holy grail’ is to recognition. It must also have be able to do that with minithe ability to plan its movemal effect on infrastructure in ments and grasps to a fine an operation.” degree of precision. That day Intelligrated’s Wicks says remains in the future. AGVs have gained popularity For an expanded version of as they have been able to autothis story, go to foodlogistics. matically reroute themselves com/2097111 ◆ around objects in a warehouse. The Raymond Corp. CouFor more information: rier, an automated lift truck, is FANUC AMERICA, 888-326designed to work without the 8287, www.fanucamerica.com need for any IT integration or INTELLIGRATED, 877-315infrastructure requirements, 3400, www.intelligrated.com such as artificial landmarks. An RAYMOND CORP., 607-656operator loads and dispatches 2311, www.raymondcorp.com the lift truck to go on an autoSEEGRID, 877-733-4743, mated mission (e.g., dropping www.seegrid.com a pallet at a station and comSWISSLOG, 41-62-837-9537, ing back). Similar to manually www.swisslog.com operated trucks, Greene, N.Y.WYNRIGHT, 847-595-9400, based Raymond has customers wynright.com installing a WMS terminal on WINTER GREEN RESEARCH, the truck as an add-on. 781-863-5078, www.winterSome see the expansion of greenresearch.com “collaborative” robots as creatwww.foodlogistics.com

8/3/15 11:10 AM

AUTOMATION FOR THE COLD SWISSLOG‘S EXTENSIVE EXPERIENCE WITH TEMPERATURE CONTROLLED WAREHOUSES ENSURES AN INSPIRED SOLUTION.

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SECTOR REPORTS

TRA NS P ORTATION: DIME NS IONA L WE IGHT PA CK A GING width

Length

Height

Girth

t’s been over half a year since mega-carriers UPS and FedEx made changes and started charging shippers higher prices for all ground shipments based on their size, instead of being based on weight. The new dimenWith innovative sional weight (DIM) sensing technology pricing models some and 3D imaging carriers have started components, ADSI’s using are designed to iDimension 200 is a flexible, moeliminate the exempbile free-standing tions that used to solution that capexist on ground tures dimensions, packages of less than weights, bar codes, OCR text and imthree cubic feet. ages of flat and In recent years, irregular objects, as more food and and converts irbeverage companies regular objects like focused on the cylinders, spheres, tubes, polybags and emerging e-comirregular objects merce demand and to accurate cubed the need to deliver dimensions. their products anywhere at any time, shippers used large, light packages as the preferred method of delivery.

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In the past, a company could just put the small or irregular item in a box with some fill-in material and send it without a lot of effort or extra costs due to its low weight. But these types of packages are the exact ones parcel carriers targeted when initiating cost cutting measures aimed at improving profits. With capacity at a premium these days, carriers have switched to dimensional weight measurements in order to better align the rates for cargo of light density with the actual costs of shipping them. Now the billable weight for packages is whichever weight is greater, the actual weight or the dimensional weight.

Small and mid-sized shippers the first in line Most of the larger companies in food and beverage (f&b) haven’t seen the changes in DIM pricing affect their bottom lines as much as the small- and mid-sized companies have, due to stronger nego-

tiation power based on higher shipping volumes. “Some of the larger shippers have been able to negotiate for higher dimensional factors, but it’s all over the board now,” says Bob Fischer, CEO of Schaumburg, Ill.based shipping solutions provider ADSI. “It’s just not clear right now, it’s sort of like the Wild West.” Since most food items tend to be dense enough to not need DIM weight, many companies in f&b may not have found extra charges on their invoices yet. But if the rest of the shipping industry starts to incorporate new DIM pricing models, more companies are likely to get caught in the DIM fallout. “If food and beverage shippers think the new dimensional weight charges will affect non-food shippers more, they are mistaken,” says Justin Headley, marketing manager for CubiScan, a Farmington, Utah-based provider of cubing and weighing systems. “If (f&b) shippers think they haven’t been directly or indirectly penalized by DIM pricing, then they need to prepare www.foodlogistics.com

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because the storm is heading their way fast.” The DIM changes have prompted companies to renew their efforts in accurately cubing and weighing items on the inbound process in receiving, so that they don’t pay later on the outbound side with increased packaging and shipping costs. “If shippers do not enter the dimensions at the time of manifest, they will receive outof-week billing adjustments (back charges) and potentially lost profit,” says Charles Moore, vice president of parcel logistics in a blog from full-service 3PL provider Transportation Insight based in Hickory, N.C. The effects of the new DIM rates will be felt throughout the f&b supply chain too, not just at the manufacturer, DC or warehouse levels.

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pile and load it on a truck anymore,” adds Fischer. “You’re going to have to have better technology and build better loads, package it right at the cart, package it right on the pallet and package it right on the truck, too.”

Tools keep shipping costs accurate, optimize loads The good news for those hurt by the new DIM pricing models is that the need for more accurate measurements has sparked a flurry of technol-

ogy designed to address the need for more accurate DIM weights. Dimensioning systems have been around for years, but with the recent changes in DIM rates by carriers, shipping technology solutions companies have experienced both an increase in interest and sales of dimensioning solutions. When Vincent Nolan, the director of visual merchandising and space optimization at The Great Atlantic & Pacific Tea Co. determined that A&P needed to increase its measurement weighing accuracy for all of its irregular-shaped inventory in all of its 300 stores, it used CubiScan 125 to collect dimensions on over 32,000 retail products. The CubiScan 125 is a small, portable device that uses infrared and ultrasound-sensing technology to measure irregular items as well as boxed ones. In the end, A&P was able realize an estimated $125,000 in savings by using the automated dimensioning system when compared to the manual measurement of inventory items.

The CubiScan 125 is a small static cubing system that uses a combination of sensing technologies to measure and weigh irregular-shaped parts and components as well as boxed items.

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www.foodlogistics.com

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Getting Gouged

BY DIM BACK CHARGES?

Control shipping costs by eliminating these four hidden dimensional rating ‘gotcha’s.’

ost freight carriers and logistics service providers have their own dimensioning systems to automatically measure package dim weights and calculate freight charges when the shipments reach their facilities. Now that FedEx and UPS have expanded their dimensional rating programs, it’s more important than ever to ensure that you are doing everything possible to eliminate operational oversights because dimensional rating is an area where seemingly minor differences in calculations results in significant back charges from the carrier. Discrepancies can occur for several reasons, but here are four of the most common: GOTCHA #1 - Actual carton measurement discrepancies: Shippers often find that the carton measurements they were using to calculate freight costs actually differed from the carrier’s measurements for the same cartons. Best practice solution: Do an audit of your inventory of carton types and sizes. Make it a regular practice to verify all of your carton or box types and compare them with your carriers’ measurements of the same. This can prevent back charges from occurring on future shipments. GOTCHA #2 - Carton shape: The volume used to calculate the dimensional weight may not be absolutely representative of the true volume of the package, depending on the shape of the package. The carrier will measure the longest dimension in the length, width and height and use these measurements to determine package volume. If the package is a right-angled box, the DIM weight will be equal to the true package volume. But if the package is irregular or misshapen, the DIM weight calculation will be greater than the true volume of the package. Best practice solution: Consider adding a dimensioning system to determine a configuration that is best for your fulfillment environment. There are a variety of dimensional systems available to accommodate a wide range of operations. GOTCHA #3 - Data entry errors: For example, the shipping clerk processes a 20-pound package measuring 20” x 20” x 20” but forgets to add the dimensions. The resulting charge is $20.00. However, when the box reaches the carrier’s facility, its equipment picks up the dimensions and calculates the dimensional rate at $40.00. You will be billed back for the difference of $20.00. These errors, added up over a year’s time, can amount to thousands of dollars in back-charges. Best practice www.foodlogistics.com

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solution: Replace the keying of box sizes with barcode scanning. Print a template of barcoded carton sizes for each carton type so the shipping clerk scans the barcode instead of keying in numbers – and potential upcharges related to incorrect measurements are eliminated. GOTCHA #4 - Packing processes: Do not over pack orders – it can easily result in back charges. For example, you pack a

carton so full that it causes the size to bulge and you report a 20-lb. carton at 20” x 20” x 20” for a freight charge of $40.00. However, the carton actually bulges out to 22” x 22” x 22”, so the carrier’s dimensional system calculates freight charge to be $45.00. Best practice solution: Integrate your box types into the order process. Set up your box sizes as a series of codes that can be passed from the order system and passed to your shipping system. If you’re using an automated packing solution, the operator can scan a carton type as they are packing the order. ◆ Source: ADSI

Close Doesn’t Count With Dimensional Pricing. Get ready for DIM-weight pricing changes. Don’t press your luck. You can no longer orders. Capture accurate cube and weight data to pick/make the right size box. Let the power and accuracy of CubiScan® work for you.

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BUSINESSES THINK DIMENSIONAL WEIGHT PRICING IS

These automated dimensioning systems are especially valuable when shipping irregular packages. “If an irregular item is presented to most courier companies, they will calculate the dimensional weight based on minimum dimensions of a package that would contain the irregular item,” states a case study by Express Cube, a provider of dimensioning solutions based in Ontario, CanBecause they say it’s Because it promotes ada. “The maximum expensive and unfair to sustainability and reflects the measurements obtained busineses and shippers true cost of shipping a package by the dimensioning Source: Endicia system will be used for invoicing, and these dimensioning systems weigh their SKUs, they really don’t have an allow shippers to package wisely and preaccurate picture of what kind of price they dict the effect of the irregular boxes.” will pay for transportation,” adds Headley. ADSI offers a mobile dimensioning tool “Shippers want to see how each shipment called Size-IT that calculates accurate DIM will impact their bottom line shortly after rates in seconds, and since it is literally the the picking process. Exporting that critical size of a tape measure, it can be used anycube and weight data for each item into a place in the warehouse WMS, cartonior DC, including shipzation or load ping, receiving and anyplanning software ED X where in between. solution will “We’re not just seeallow companies ing the use of dimento optimize and sioning tools in shippositively impact ping, but we’re seeing it their shipping in receiving, in packagcosts.” ADSI’s Size-IT handheld digital ing and elsewhere,” says Although dimensioning tool is an ideal tool to Fischer. “I think it will changes in DIM capture dimensions on inbound move upstream and it charges may curshipments and upload packaging details to your host systems. will change how the rently seem like packaging is created a burden, most For more information: and how the actual industry insiders products themselves are feel there is little ADSI, 1-877-755-2374, of designed.” doubt the changwww.adsionline.com businesses Companies can es will continue CUBISCAN, 1-800-488-2923, have never to impact the also incorporate these www.cubiscan.com heard of DIMENSIONAL dimensional tools entire global food ENDICIA, 1-800-576-3279, WEIGHT PRICING www.endicia.com into their warehouse supply chain. EXPRESS CUBE, 1-877-428-2348, management system While the impact Source: Endicia www.expresscube.com (WMS), ERP system of DIM is curFEDEX, 1-800-463-3339, www.fedex.com or other shipping softrently being used TRANSPORTATION INSIGHT, ware programs before they are picked to to increase the cost of freight shipping, 1-877-226-9950, www.transportationinoptimize their loads for shipping. getting a firm grasp of how a company calsight.com “Vendors are constantly changing packculates DIM rates right now will only help UNITED PARCEL SERVICE (UPS), aging; if they don’t accurately measure and decrease their cost going forward. ◆ 1-800-742-5877, www.ups.com

unfair

74% DISAGREE with this rating method

26% AGREE

with this rating method

Why?

F E AND UPS

Price Hikes WILL BE A

SURPRISE TO MANY

BUSINESSES

28%

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www.foodlogistics.com

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SECTOR REPORTS

SOF TWA RE & TE CHNOLOGY: BIG DATA

Internet-Based Technology Redefines F&B Supply Chain Operations A data explosion promises greater efficiency in all areas. BY ELLIOT MARAS

re you spending more time trying to organize your time? No matter what your role is in the food and beverage supply chain, there is more data to keep track of that affects the decisions you make. Whoever said that computers and technology will make us more efficient forgot about the data explosion these tools unleash. Whether you oversee truck deliveries, keep track of warehouse temperatures, update inventory records or fill out government compliance reports, “big data” can be a big help but it can also bring an organizational nightmare. Data storage capacity continues to expand to allow us to manage more data faster. But knowing how to do this can be compared to driving a high-performance sports car. You must know how to control the horsepower. 58

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Gartner Research characterizes data as “the oil of the 21st century, and (data) analytics is the combustion engine.” Says Peter Sondergaard, senior vice president of research at Gartner Research: “IT leaders must embrace the post-modern business, a business driven by customer relationships, fueled by the explosion in information, collaboration, and mobility.” Today, Internet-based technology is redefining all types of commerce.

From transaction to interaction Consumer goods industries are rapidly evolving from transaction-based commerce to interaction- and observation-based analysis and decision making capabilities, says Brent Buttolph, a principal consultant in national retail practice at Teradata, a Dayton, Ohio-based analytics provider. In order to achieve new business insights, con-

sumer goods providers need to access a much broader set of data types fueled by the explosion of digital data (mobile, social, sensors, etc.). In addition to inventory, consumer goods providers need access to customer interactions across a myriad of devices (smart phones, kiosks, lockers, Web sites, etc.), surveillance cameras, call centers, social media sites, etc. They also need the ability to integrate data in different formats other than traditional structured (column and row) data, such as: text, video, Web logs, geo-location, as well as third-party data such as weather maps and customer demographic data. F&b manufacturers and self-distributing retailers in particular need access to onboard computer and sensor-based data such as: cargo temperature, driver speed, tractor idling time, maintenance readings, etc. “That data is continuing to come in a streaming fashion,” Buttolph says. Two of the biggest changes technology is bringing is the speed by which data moves and the growth of algorithms that allow for improved data analysis. Software now allows companies to conduct analytics and do more advanced modeling on data being captured at faster speeds than a decade ago, says John Richardson, vice president of supply chain www.foodlogistics.com

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Pallet Flow

Push Back

Wide Span

Selective Rack

Cantilever

Warehouse Racking

SolutionS 8 7 7. 6 3 2 . 2 5 8 9

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analytics at Transportation Insight, the Hickory, N.C.-based 3PL. The increased pervasiveness and predictiveness of data solutions give new strategic heft to the traditional “what/if” analysis to questions that arise in the f&b supply chain, Richardson says. Such questions include: • How do we get orders to customers most efficiently? • Where should we source/make particular products? • How many products should we source/make? • Where should inventory be? • From whom do we purchase materials? How many? • What’s the most efficient transportation mode to use? • Which DC should ship products to particular customers? • What if demand increases X percent?

Data explosion continues In any supply chain organization, the data has expanded at an alarming rate. In the f&b supply chain, there are several factors driving data proliferation. A major factor driving data proliferation is warehouse automation. The f&b supply chain lags some other industries in its use of automation, but equipment providers 60

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• Big data has allowed grocery retailers to move from transaction-based commerce to interaction- and observation-based analysis and decision-making capabilities.

unanimously agree the rate of investment is increasing. The amount of data will continue to increase along with automation. “Material handling organizations are seeking data that gives them insight to drive better business decisions, particularly around asset utilization, safety and productivity,” says Jim Gaskell, director of global technology business development at New Bremen, Ohio-based Crown Equipment Corp. “The challenge is filtering data in a way that presents managers with only the data they care about in a format that makes it easy to both monitor operations and drill down into potential problem areas. For customers that are just getting into analytics, we see the most interest in forklift impact reports, which correlate directly with safety, and forklift operator productivity reports.” Consumer demand for more information about food will also expand data in the f&b supply chain, Teradata’s Buttolph notes. As consumers are increasingly making purchase decisions based on product origin (i.e., local), social consciousness (i.e., fair trade) and ingredients (i.e., gluten-free), retailers are looking to trade partners to provide a richer level of detailed attribution

Teradata

on all products. “That’s what consumers are looking for,” Teradata’s Buttolph remarks.

Auto ID technology expands Automatic identification (Auto ID) technologies—including barcode, radio frequency identification, voice, point-of-sale systems, imagers, and beacons—are one of the evolving supply chain technologies, according to the Material Handling Institute (MHI) 2015 Annual Industry Report. Auto ID systems generate vast amounts of data. Auto ID feeds corporate information systems with the precise identity and location of each physical item in a supply chain in an automated and timely manner. Auto ID technology provides a big opportunity to improve tracking and tracing systems, process control, and inventory management. Longer term, Auto ID systems can give a company full visibility into its supply chain by removing a number of traditional limitations. One of the fastest growing Auto ID technologies among transportation and logistics companies is radio frequency identification (RFID). According to MHI, RFID achieves: near 100 percent accuracy www.foodlogistics.com

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in shipping, receiving, orders, and inventory accuracy; 30 percent faster order processing; and 30 percent reduction in labor costs. By 2018, the total market for RFID is expected to more than double in size to $20 billion. The retail industry is the primary user. Newer technologies, such as two-dimensional imagers, are gaining momentum because of their ability to read two-dimensional bar codes for coupons and other smart-phone applications, MHI notes.

and company regulations. A statistical modeling report can allow a fleet manager to determine what drivers cause excessive idling.

Food safety drives data tools The growing interest in food safety – be it government-mandated or industrydriven – also pushes the adoption of data collection systems. Food companies are collecting more data to ensure both that the product stays safe and that they know what went wrong if anything compromises the

Computer capabilities improve

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In addition to material handling equipment, companies are also finding newer computer hardware and software allows them to access data faster. Hardware and software providers alike continue to introduce new ways to access data, such as mobile devices and data visualization software. These systems often deliver new data platforms to support innovations like productivity dashboards. Melinda Laake, manager of enterprise solutions at Greene, N.Y.-based Raymond Corp., says there are four elements needed to utilize Internet-accessible data: 1) an identity for whatever holds data, be it a machine, a report or a person, 2) a way for the entity to connect to the Internet, 3) the entity’s ability to be sensed, and 4) the ability to interpret the information being sent, be it by a mobile device, a PC or something else. Utilization and activity reports are providing a more complete view of the supply chain as more data becomes available, adds John Rosenberger, manager of iWarehouse Gateway and global telematics at Raymond Corp. For instance, data from lift truck sensors can allow a supply chain manager to know if the driver should be driving instead of walking certain distances. Current warehouse management software allows companies to collect data, analyze it and present reports for making decisions. In the new era of “big data,” Rosenberger says decision makers will also be able to verify data collected, correlate more data sources, and better predict what will happen based on the data. Transportation management software similarly gives management access to data sets such as geo-location of vehicles, engine performance, weather reports, maintenance records, driver compliance with government

product. Where records have traditionally been tracked with paper-based logs, more companies are using devices pre-loaded with checklists that instantly transmit data over the Internet. Sensors are able to track the condition and quality of food as it’s produced, transported and stored. Traceability information can now be exchanged between each stakeholder in a supply chain, from the raw ingredients supplier, through the pack-house/manufacturer and then on to the retailer, via logistics

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and distribution. “This vital information about what happened to products at each stage of the manufacture from raw materials through to arriving on the retailer shelf is essential in enabling a food organization to comply with ever-increasing food safety and traceability requirements,” says Carl Iversen, vice president of product development at LinkFRESH, the Ventura, Calif.based ERP provider.

Internet cloud changes the playing field Another driving force is the emergence of the Internet cloud. “What supply chain models did to manufacturing is what cloud computing is doing to in-house data centers. It is allowing people to optimize around where they have differentiated capabilities,” says Gartner Research’s Sondergaard. Cloud-based systems are playing a big role in allowing f&b companies to integrate data siloes. The July Food Logistics explored how cloud-enabled enterprise-wide software is gaining traction in f&b. F&b companies typically have 20 to 25 separate data siloes, says David Gustovich,

FL Web Exclusive: How Big Data Is Changing Retail Scott Bolduc, director of supply chain strategy for SPS Commerce, assessed big data in the retail supply chain.

hen retailers, suppliers and other trading partners share their data and insight, a detailed snapshot of item sell-through, inventory and order fulfillment emerges. Sharing such intelligence across a business network strengthens collaborative relationships for improving delivery of products when and where they’re needed, boosting profitability for all parties involved. Suppliers that have real-time visibility into product performance can spot and respond to new opportunities and sales trends, while more accurately refining forecasting, quickly identifying what needs their attention, and proactively adjusting inventory to avoid stock-outs or oversupply. What’s more, using data analytics to track vendor performance, such as order fill rates and on-time metrics, makes suppliers and trading partners more accountable. Quality improves throughout the chain, to the benefit of supplier, retailer and consumer alike. What is the take-away from all of this? Simple: Big data is essential for optimizing performance in omnichannel retail. For the full blog, visit foodlogistics.com/12062595. ◆

founder and president of Wexford, Pa.based IQity Solutions, LLC, a provider of cloud-based software systems for the food industry. Integrating sales, order management, shipping and invoicing into one system reduces time, labor and cost. “I find there is a growing level of awareness of the value of an integrated system,” says Gustovich, who has ownership in a

food company with multiple operating locations. “The next generation of business technology is more integrated.” Users of legacy systems have plenty of third-party providers at their disposal willing to customize and integrate these siloes of data points for a cost. The end result will be usable, digital representations of data that would otherwise elude users.

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Universal Lumpers, the Denver, Colo.-based provider of lumping services to f&b facilities, recently moved its services to the cloud, says Joe Curry, vice president of operations. “For any manager in the supply chain to have a snapshot of the grand picture and have everything integrated is absolutely critical,” Curry says. “Just collecting data is one thing. Being able to analyze it and figure out what it’s telling you is another.” “We are finding a lot of advantages to cloud-based deployment of our forklift fleet management system,” says Gaskell of Crown Equipment Corp. “On-premise deployment is still a viable option for organizations that aren’t comfortable with the cloud, but a cloud-based system is easier to deploy and maintain and can more easily scale to support multiple facilities across an enterprise. Most importantly, as more users move to the cloud, data can be aggregated across organizations to provide industry-specific benchmarks that www.foodlogistics.com

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food companies can use to analyze their performance relative to industry averages.”

Integrated data enhances safety Gary Neights, a senior director at Elemica, a Wayne, Pa.-based supply chain software provider, says integrated operating networks are especially helpful in establishing safety and quality control. If a food processor, wholesaler or retailer suffers a listeria outbreak, an operating net• Automation work will let them significantly quickly determine expands the number of data which batches points in a food are affected and and beverage whether they supply chain. are in trucks or Crown Equipment railcars or sitting on a shelf some place. Putting cross-company data into a single, searchable silo gives a supply chain operating network a unique ability to let a user quickly retrieve information whether it resides in an order, shipping documents, FOOD LOGISTICS

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tive products to the market relies on the ability to fully integrate trading partners to connect the entire supply chain.”

The HR challenge rises

• Warehouse managers use cloud-based fleet management to review performance metrics with employees.

Crown Equipment

delivery schedule, receiving documents, laboratory records and more. A transportation management system, by contrast, may have some of this information but it might not have all of it, Neights says. One technical function Elemica performs related to big data for inbound logistics is what Neights calls “ETL” – extract, transform and load. All the cross-company data flowing through the network is loaded into the company’s alerting, analytics and reporting platform. “Precision agriculture” has done a lot to educate the f&b industry about supply chain operating network software, Neights says. Precision agriculture refers to observing, measuring and responding to interand intra-field variability in crops. GPS was a key development in the growth of precision agriculture. The farmer’s ability to locate a precise position in a field allows for the creation of maps of the spatial variability of as many variables as can be measured, such as crop yield, terrain features/topography, organic matter content, moisture levels, nitrogen levels, pesticide levels, pH, etc. This supports optimal application of seeds, fertilizer, herbicides, and pesticides to maximize production with minimize waste. A “pedigree” of each seed or plant could be created that show exactly what chemical (and even batch) that was applied to each plant. This pedigree can be communicated through the 64

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supply chain operating network across all steps in the food and beverage value chain.

New competitors drive data capabilities Another driving force to make use of more data faster is a new set of f&b competitors, says Ranga Bodla, industry leader for wholesale distribution and manufacturing at San Mateo, Calif.-based NetSuite. Specifically, the ecommerce merchants. Dedicated ecommerce players like Amazon are fairly new and are able to invest in the latest supply chain technology. Besides bringing more competition to the fray, the ecommerce players are changing consumer buying behavior in ways that forces established retailers to reconsider their supply chain strategies. In some cases, companies need to gather data faster and organize it better. Companies are striving to bring new products to market faster, streamline supplier processes and improve supply chain efficiencies, according to a white paper by Amber Road, the Rutherford, N.J.-based technology consultancy. “During the journey from new product innovation to the final physical product, executives know they must share accurate product information with a variety of global suppliers without confusion and delays. Connecting all of these processes, systems and suppliers is challenging. Success in delivering innova-

For all the advanced technology coming to the fray, one of the biggest challenges users must address is the human one. Another big challenge is deciding what technology solution best fits an individual company. The data explosion isn’t making this task easier. “You have to figure out what is the right configuration for your current IT infrastructure and the organization skill sets needed to support it,” Buttolph says. But in his mind, this is not an insurmountable task. “The key is to start small and grow with a longer term view in mind,” he says. “Standing on the sidelines is no longer an option in this highly competitive industry. There are a lot of good, solid providers available to help.” Still another factor driving change is a lower technology investment and new skill sets required to leverage these emerging analytic tools. Teradata’s Buttolph cites this as they key challenge facing the f&b supply chain. “Technology (in and of itself) is not a barrier to entry in pursuit of deeper business insights,” he says. ◆

For more information: AMBER ROAD, 201-935-8588, www.amberroad.com CROWN EQUIPMENT CORP., 419-629-2311, www.crown.com ELEMICA, 484-253-4674, www.elemica.com GARTNER RESEARCH, 800-213-4848, www.gartner.com IQITY SOLUTIONS, 724-933-6133, www.IQitysolutions.com LINKFRESH, 44-1223-873400, www.linkfresh.com MATERIAL HANDLING INSTITUTE, 704-676-1190, www.mhi.org NETSUITE, 650-627-1000, www.netsuite.com RAYMOND CORP., 607-656-2311, www.raymondcorp.com TERADATA, 866-548-8348, www.teradata.com TRANSPORTATION INSIGHT, 828-485-5000, www.transportationinsight.com UNIVERSAL LUMPERS, 888-4-LUMPER, www.universallumpers.com www.foodlogistics.com

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Wednesday, November 4 Wednesday, September 23

Software & Technology Part 1

Wednesday, August 26

Cold Chain

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Software & Wednesday, December 9 Technology Part II: Wringing Hottest Food NTEIMW.mE:. ET Out Costs, Supply Chain 2 p Elevating ROI Trends for 2016 _________________

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The global food supply chain depends on an integrated cold chain to support time- and temperature-sensitive shipments. This educational webinar reveals some of the latest cold chain innovations in this growing sector.

From TMS and WMS solutions to new products and equipment, software/ tech is driving safety, efficiency, compliance and visibility throughout the food supply chain. Expert panelists discuss key developments in this fastmoving sector.

The inherent power and potential of software and technology solutions is augmented when applied throughout an organization’s supply chain, wringing out costs and elevating ROI. Learn best practices for creating an enterprise-wide software and technology strategy.

Get up to speed on the hottest food supply chain trends for 2016 from a diverse panel of experts and forwardthinkers.