Beruflich Dokumente
Kultur Dokumente
* Eighteenth Edition *
Copyright 2010
Phone: +1-608-873-8929
Fax: +1-608-873-5509
www.3PLogistics.com
18th Edition
Page 2 of 625
Table of Contents
Page
9
10
18th Edition
12
15
AFL Logistics
18
Agility
Aimar S.A.
22
33
36
Almacenadora, S.A.
Almacenadora de Depsito Moderno, S.A. de C.V. (ADEMSA)
39
42
45
Almagrn y Almacenar
48
Almaviva S.A.
Alpopular S.A.
52
55
58
APL Logistics
Aqua Logistics Limited
64
70
Aramex
76
82
85
88
Barloworld Logistics
BDP International
93
100
107
110
113
BettR Logistics
117
120
126
129
137
140
143
146
156
159
164
171
CEVA Logistics
175
180
184
187
CWT Limited
190
D.Logistics AG
DACHSER GmbH & Co. KG
195
199
Damco
205
DB Schenker Logistics
De Rooy Logistics BV
211
219
De Well Group
222
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226
236
240
245
248
251
256
Fatton Transport
FedEx Supply Chain Services/FedEx Trade Networks
265
268
Fiege Logistics AG
275
282
287
Geodis
292
GIRAG
GLOVIS Co., Ltd.
298
301
Grupo TPC
304
307
310
313
318
321
I.T.S. Fabry SA
324
327
334
340
345
348
351
356
362
367
Kuehne + Nagel
371
Levent
Livingston International, Inc.
380
383
387
391
394
399
Lus Simes
Mainfreight Limited
402
405
410
419
424
427
432
438
441
445
449
457
Penske Logistics
Phoenix International Freight Services, Ltd.
460
470
475
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18th Edition
Rapido Cometa
478
482
486
489
492
501
505
509
515
520
523
526
532
STACI
Sudamericana Agencias Areas y Martimas S.A. (SAAM)
535
538
Sun Logistics
541
545
550
553
558
563
TRADISA
566
569
574
577
586
597
602
Wheels Clipper
606
Wincanton Logistics
Yobel Supply Chain Management
610
615
618
Zimag Logistics
623
Page 5 of 625
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Section 1
3PL MARKET GROWTH & LOGISTICS COSTS
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*Total 2009 gross revenue (turnover) for the 3PL market in the U.S. is estimated at $107.1 billion. $3 billion is
included for the contract logistics software segment.
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*Includes Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama.
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Section 2
INTERNATIONAL LOGISTICS PROVIDERS
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Basic Definitions
Logistics: Logistics is part of the supply chain process. It is the part involving planning, doing and controlling the
flow and storage of goods and information. Goods and information flow from origins to customers
destinations.
Contract Logistics: A contractual agreement to provide logistics services. Usually prices, length of contract (term),
services required and other considerations are defined and agreed to by the parties.
3PL: The value-added logistics provider who contracts to provide the requested services.
4PL: A consultant operating in the capacity of an LLP, LLM or SCI.
LLP (Lead Logistics Provider): A value-added logistics provider who manages other contract logistics operators
and provides supply chain consulting services for his customer.
LLM (Lead Logistics Manager): A value-added lead logistics provider who designs, builds and manages supply
chain assets, processes, people and technology.
Description
1 COMPANY BACKGROUND
Asset Focus
Founding Business
Market Area
2 INFORMATION SYSTEMS
Bar Coding
EDI
End-to-end Matching
ERP Interfaces
Mode Conversion/Optimization
Network Modeling
Radio Frequency
The system can track and trace shipments anywhere in the supply
chain within minutes.
TMS
WMS
3 TRANSPORTATION MANAGEMENT
Air Freight Forwarding
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End-to-end Matching
Freight Brokerage
Performs freight bill audits after the freight bill has been paid.
Home Delivery
Load Tendering
Mode Conversion
Small Package
Customization
Facilities Mgmt
KanBan
Kitting
Manufacturing Support
Merge in Transit
Merges shipments from multiple origins into one large shipment prior
to delivery at the final destination.
Pick/Pack
Pool Distribution
Rail Siding
Sequencing/Metering
Sub-Assembly
5 VALUE-ADDED SERVICES
Inventory Control/Vendor Mgmt
Labeling
Lot Control
Repair/Refurbish
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Reverse Logistics
Specialty Packaging
Store Support/DSD
Factoring/Financial Services
Installation/Removal
Order Management
Project Logistics
Quality Control
Union Services
7 INTERNATIONAL SERVICES
Areas Served
Consolidation
Customs Brokerage
Export Crating
NVOCC
Port Services
Food Grade/Sterile
Hazardous Materials
ISO Certified
Temperature Controlled
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52 55 57 05 47 94
COMPANY BACKGROUND
Parent Corporation:
ACCEL
Asset Focus:
Market Area:
Founding Business:
North America
Merchandise Safekeeping
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Manuel Javier Muoz Martin CEO
Georgina Castro
Marketing Mgr.
Jesus Lara
Logistics Mgr.
CIO
37
37 **
Exchange:
611
MX
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
40
1.8
Total Other:
Total Trailers:
Total Aircraft:
80
10
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
100
Total Tankers:
Total Other:
MAJOR MARKETS
Food, Groceries
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): SCA, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
SCA, Proprietary
SCA, RedPrairie, Proprietary
18th Edition
EDI Handling
ERP Interfaces
Page 15 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Chedraui
General Merchandisers
Mexico
Costco Wholesale
Specialty Retailers
Mexico
Productos Carnicos
Food Production
Mexico
Soriana
General Merchandisers
Mexico
Wal-Mart Stores
General Merchandisers
Mexico
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 16 of 625
Asia/Pacific
Australia/New Zealand
Europe
North America
ACCEL
Latin/South America
Mexico
United States
EDITOR'S COMMENTS
ACCEL is divided into two divisions: Logistics which is 17.6% of revenue and Manufacturing which is 82.4%. Its
clients are mainly in the consumer food and confectionary, retailing, automotive, technological, and healthcare
verticals.
Additional services offered include plastic injection, metal stamping, tool design, and paint finishing.
U.S. Headquarters Contact Information:
4606 FM 1960 West, Ste. 325,
Houston, TX 77069
Phone: +1-281-440-5595
Fax: +1-281-440-4042
Email: clarkjohnc@accelonline.com
Provider's Strengths
VAWD
Provider's Weaknesses
Scope and geographical reach.
Warehouse management solution to be installed at 31 sites, including the first implementation in Argentina
MILWAUKEE--(Business Wire)--RedPrairie Corporation, a world leading consumer driven optimization company, and its partner
NetLogistiK, today announced that seven companies in Latin America have recently chosen RedPrairie's Warehouse Management solution.
NetLogistiK will implement RedPrairie's Warehouse Management solution for six new customers in Mexico and one in Argentina. NetLogistiK
and RedPrairie became partners in 2003 and currently have 42 sites in Mexico and Latin America.
"Latin America is awakening to a more advanced supply chain technology. As the world becomes more globalized and boundaries irrelevant,
Latin American companies of all sizes are facing increasing competition from both near and far away countries. Especially in the vertical
industries of retail and high-value goods, such as pharmaceutical, electronics and third party logistics (3PL), companies are adopting technology
to better manage inventory both in the warehouse and in transit while protecting their operating margins. These companies are gaining supply
chain security and visibility to give them a strong competitive edge," said Francisco Giral, CEO for NetLogistiK.
Companies that recently chose RedPrairie solutions in Latin America include:
--------
Accel, a third party logistics provider, chose RedPrairie WMS and RF solutions to run at more than 10 sites in Mexico
Servicargo, a third party logistics provider, plans to implement the WMS and RF solutions at five sites in Mexico
Farmacias del Ahorro, a pharmaceutical retailer, will implement WMS, Voice Picking and RF at three new sites in Mexico
Multipack, a third party logistics provider, has implemented its first site in Mexico City in a record time of 12 weeks
Grupo Dico, a furniture retailer, has chosen NetLogistiK for distribution center design and RedPrairie WMS for two new sites in Mexico
Farmacia Guadalajara, a pharmaceutical retailer, plans to implement WMS and Voice Picking at its facilities
Celsur, a third party logistics provider, has chosen WMS for its Buenos Aires distribution center
"We understand that technology will play a key role in the growth plans and success of our organization," said Marcelo Ormachea,
Operations Manager from CELSUR Logistica.
"We are certain that the experience acquired by RedPrairie in its collaboration with the world's leading 3PL's will provide us with more
flexible and scalable advantages to our expanding business," said Francisco Alvarez, CEO of CELSUR Logistica.
"Nowadays the logistic providers sector (3PL's) demands real time information as well as broad controls, traceability and flexibility among
the services provided to its customers. RedPrairie offers a solution especially robust for logistics providers that combines all these advantages,
with differentiated configurable options to service each customer. In addition, its billing capabilities enable us to assure and surpass the
expectations of each one of them," said Jesus Lara, CIO from Accel Logistica.
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91 22 2920 6993
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Airfreight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Cyrus Guzder
Juzar Mustan
Sanjita Chetri
CEO
Media Relations
Sanjeev Jain
Vivekanand Heble
CFO
CIO
280
Ticker Symbol
280 **
Exchange:
2,350
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
1,000
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Agrani
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--Agrani
18th Edition
EDI Handling
ERP Interfaces
Page 18 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Arvind Mills
Textiles
Blue Star
Canon India
EnPro Industries
Manufacturing
Herbalife
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
India
India
Page 19 of 625
Asia/Pacific
Australia/New Zealand
Europe
North America
India
Canada
Singapore
United States
AFL
Latin/South America
Thailand
EDITOR'S COMMENTS
AFL is a sizable 3PL for India. It has three business divisons: Express Courier, Logistics, and International
Cargo. In 2007, AFL set up a joint venture with German 3PL DACHSER named AFL DACHSER Pvt Ltd. based in
Mumbai. Each company has 50% stake. Earlier this year, AFL formed a strategic alliance with UPS Jetair Express
to expand its international presence while expanding UPS's presence in India.
Provider's Strengths
Airfreight; warehousing throughout India.
Provider's Weaknesses
AFL Logistics, one of the leading integrated logistics service providers, has opened what is said to be a first-of-its-kind fashion and luxury
retail distribution centre in Bhiwandi near Mumbai.
According to Juzar Mustan, CEO, AFL Logistics, demand for retail-ready distribution facilities has prompted the company to invest in
creating such facilities in major metros across India.
He said, AFL Logistics is now poised to embark on significant expansion by developing its warehousing capabilities and retail presence in
metro cities. It will shortly start another facility in Bangalore.
The 12,000 square foot facility at Bhiwandi boasts distinctive features like automated biometric access, infrared security and surveillance with
high-end cameras which are capable of motion based capture, customized racking and a fully mapped warehouse management system. Binning
and picking is guided by a wireless RF (radio frequency) gun which is one-of-its-kind in India.
The new 'facility within a facility' has been designed for one of its clients, Madura Garments Lifestyle Retail Company, a division of Aditya
Birla Nuvo.
UPS, AFL launch strategic alliance in India
MUMBAI, IndiaUPS Jetair said yesterday it has formed a strategic alliance with AFL, a provider of air freight forwarding , air express, and
third-party logistics (3PL) services, which, UPS said, will significantly expand accessibility to UPS services in India and provide export
capabilities to AFL.
UPS said in a statement that this alliance will officially kick off on January 1, 2008 at which point all AFL WiZ Express Centres in India will
promote UPSs international express delivery service to India-based shippers.
UPS Spokesman Mark Dickens told Logistics Management that India is a priority market for the company. He said that the companys
efforts in India to this point have really been focused on the international express business. The domestic business, he said is relatively
fragmented, and UPS wanted to focus its attention on what presented the most opportunity in the short term.
We are going to be working on expanding our presence in India and saturating the market, and this [alliance] with AFL will allow us to do
that, said Dickens.
Between now and January, UPS is examining ways in which it can optimize AFLs network thought the companies UPS Jet Air Express
effort, which is an international express delivery service provider that connects India with the global marketplace, according to UPS.
UPS added that AFL will continue to function as a domestic service provider connecting businesses across India, and this strategic alliance
will allow AFL to pick up international export shipments on behalf of UPS destined for the more than 200 countries and territories served by
UPS. It added that UPS access points for customers with international express delivery requirements will increase to more than 200 locations in
India.
Dickens said this strategic alliance is different from a typical joint venture in the sense that it is harmonizing the companies networks in
India to make them more fluid and provide consistent service.
In terms of the competitive advantages this strategic alliances offers shippers, Dickens said a lot of it comes down to scope and scale that
comes from two experience and well-recognized partners working together.
Incredible India
The Indian office of tourism has been advertising the country around the world under the motto Incredible India. The slogan could equally be
used to characterize India's dynamically growing economy. The country's forwarding sector is always good for surprises too.
The global German logistics service provider Dachser set up a joint venture with AFL Pty Ltd, based in Mumbai at the beginning of
February. AFL is one of India's leading logistics companies, although it is not yet well known internationally. AFL has 2,350 employees and
generates sales of EUR 190 million annually, making it one of the major players in India's forwarding sector.
Comprehensive network in India
The family-owned company took its first steps in aviation over 50 years ago and then expanded its activities to all areas of the logistics
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industry, including LTL and FTL transport, customs clearance and warehousing. It was a partner of DHL Express from 1979 to 2002. AFL has
been developing its own CEP services in India (AFL WiZ) since 2002. In 2006, it launched AFL TouchWorld, India's first retail outlet chain for
convenience services, providing foreign exchange facilities, money transfer, international telephone, domestic and international courier and travel
insurance services, as well as e-ticketing. AFL also expanded into contract and valuables logistics in 1996.
In the forwarding segment, AFL operates 200 branch offices, 16 logistics hubs, 46 warehouses and a fleet of about 1,000 containerized
vehicles in India. In addition, the company has its own offices in the USA and Canada. In other international traffic, however, AFL works with
agents.
Worth waiting for
Cyrus Guzder, AFL's chairman and managing director, said that with the expansion of the global players, which have set up their own networks
here in India by now and are crowding us, our own international network was becoming less stable. We were faced with the choice of either
finding new partners every year throughout the world, or looking for one single partner with a global network at its disposal." Guzder finally
chose a family-owned company whose managing shareholder "thinks like me. He has the same philosophy. Moreover, we have concluded a very
similar generation contract with our family members. This gives the two companies a great deal of stability.
Guzder said that he took his time with the decision. AFL had already collaborated with Dachser for over ten years before the joint venture
was formed. Guzder was impressed by the development of the German company in Europe, China and the USA in the last five years. Those are
all important business markets for India. In return, AFL can offer Dachser a strong overland transport network in India, as well as a strong
presence in South and Southeast Asia, to round out its activities.
Each of the partners has a 50% stake in the new joint venture, AFL Dachser Pvt Ltd. The company employs 495 people in 30 locations and
is based in Mumbai. AFL hived off part of its business to integrate it into the joint venture with Dachser. The members of the board are AFL
chairman and managing director Guzder, AFL director Farukh Guzder, Dachser director Bernhard Simon, and Thomas Renter. Detlev Janik,
who previously served as global head of AFL Cargo, was named CEO of the joint venture.
AFL continues to collaborate with its established partners in countries where Dachser has no subsidiaries of its own. However, in Great
Britain, where Dachser has been active for many years, AFL will still continue to rely on Davis Turner as in the past. In Switzerland, AFL has
switched from Natural (now called Agility) to Dachser. In China and Hong Kong, AFL also plans to change to Dachser, according to Guzder.
The subsidiaries in Canada and the USA were sold to Dachser (USA).
Will AFL take to the air?
Guzder sees splendid opportunities for growth for his company through the intensified collaboration with Dachser in all of its established
areas of business (motor vehicles, consumer goods, electronics, mechanical engineering, telecommunications, energy, chemicals and
pharmaceuticals, media, foods), but especially in project cargo and airfreight.
There are rumors that Guzder is planning to found or participate in a cargo airline, but AFL will not comment on that topic. Guzder is
known for his great interest in aviation. He was once a member of the board of directors of Air India, among other things. AFL's internal cargo
volumes are not high enough to regularly fill freighter aircraft, but airfreight in India generally is expected to undergo a significant upswing,
especially if Wal-Mart or Carrefour get a foothold in the country.
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info@agilitylogistics.com
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1849
Asset Focus:
Market Area:
Founding Business:
Global
Freight Forwarding
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
Tier 1 global supply chain manager with a presence in most major markets with strong Middle East connections.
KEY PERSONNEL
Tarek Sultan
Essa Al Saleh
Dan Mongeon
CFO
COO, Asia
5,594
2,176 **
Exchange:
34,000
KSE, DFM
ASSETS
Total Transportation Assets:
Total Tractors:
3,000
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
3,000
Total Other:
Total Reefers:
Total Flatbeds:
11
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Retailing
Technological
Food, Groceries
Healthcare
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--MicroTransport, Oracle--OTM
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Infor/CAPS
Oracle--OTM
Log-Net
18th Edition
EDI Handling
ERP Interfaces
Page 22 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
AAFES
Military, Government
Engineering, Construction
UK
Al-Nahdi Medical
Saudi Arabia
Cadbury Adams
US
Cemex
UK
Cookson
Europe
General Electric
Diversified Financials
Europe
Groupe Auchan
Bangladesh
Petroleum Refining
Saudi Arabia
Lite-On IT Corp.
Computer Peripherals
Asia
Princess Cruises
Entertainment
US
Qatar Petroleum
Petroleum Refining
Qatar
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 23 of 625
Europe
North America
Latin/South America
Afghanistan
Australia
Austria
Canada
Angola
Bahrain
Bangladesh
Guam
Belgium
Mexico
China
New Zealand
Czech Republic
United States
India
Denmark
Argentina
Aruba
Bolivia
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Jamaica
Netherlands Antilles
Nicaragua
Panama
Paraguay
Peru
Puerto Rico
Trinidad and Tobago
Uruguay
Venezuela
Benin
Botswana
Australia/New Zealand
Agility
Algeria
Africa/Middle East
Asia/Pacific
Finland
Indonesia
Burundi
France
Cameroon
Cte d'Ivoire
Japan
Cyprus
Kyrgyzstan
Egypt
Malaysia
Ethiopia
Gambia
Maldives
Kazakhstan
Germany
Greece
Hungary
Ireland
Italy
Nepal
Netherlands
Guinea
Pakistan
Norway
Iraq
Philippines
Poland
Jordan
Kenya
Singapore
Portugal
South Korea
Romania
Sri Lanka
Russia
Taiwan
Slovak Republic
Ghana
Kuwait
Lebanon
Libya
Slovenia
Thailand
Madagascar
Malawi
Spain
Vietnam
Sweden
Mali
Switzerland
Malta
Mauritius
Morocco
Turkey
Mozambique
United Kingdom
Ukraine
Namibia
Nigeria
Oman
Qatar
Rwanda
Saudi Arabia
Senegal
Seychelles
South Africa
Tanzania
Tunisia
Uganda
United Arab Emirates
Yemen
Zambia
Zimbabwe
EDITOR'S COMMENTS
Agility is the new name for PWC Logistics following the integration of its different acquisitions. These include
major international transportation manager GeoLogistics and several smaller 3PLs.
Agility has expanded its highly profitable business dramatically over the last five years from its warehousing
base in Kuwait. It is a Middle Eastern leader in integrated supply chain solutions and is organized into three major
business groups. Global Integrated Logistics (GIL) is the largest generating approximately 65% of Agilitys
revenues and having more than 23,000 employees. The majority of GILs revenues (just under 90%) are
generated outside of the U.S. It has core competencies in freight forwarding, contract logistics/warehousing,
project logistics, fairs & events, and supply chain management 3PL services. The Defense & Government Services
(DGS) business group generated approximately 32% of Agilitys revenues and had a workforce of over 10,000
before 2010. It provides 3PL services tailored to governments, relief agencies and international institutions
worldwide. These services include extensive warehousing and trucking operations in Kuwait to support U.S.
Department of Defense distribution needs in the region. The final business unit is Investments which draws on
local insights from Agilitys global network to identify real estate and private equity opportunities in Asia, Africa and
the Middle East. Investments accounts for approximately 3% of Agilitys revenues and employs more than 2,000
people.
Hans Hickler, previous employed at APL and DHL, is now COO of Asia and is expanding operations particularly
in Southeast Asia and Vietnam.
Provider's Strengths
Unsurpassed Middle Eastern operations and solid freight forwarding network. Willing to handle riskier projects
which often generate above average returns.
Provider's Weaknesses
Limited North American warehousing capabilities.
Page 24 of 625
Key Personnel:
Mokhtar Bazaraa, Senior Vice President
Gultekin Kuyzu, Senior Manager
Overview
In 1979 Agility began providing logistics services and with 2008 revenues of $7 billion and operations in over 100 countries, it has expanded
rapidly to become a top-ten global supply chain manager. It has grown both organically and through acquisitions of U.S. based GeoLogistics and
several smaller sized third-party logistics providers (3PLs). Agility focuses on offering customers supply chain solutions tailored to meet
individual business needs through a global network of warehousing facilities and transportation management operations. As part of its growth
strategy, Agility has adapted an asset-right business model, which means acquiring assets to meet specific customer and regional market
logistics needs. Major Agility customers include: ABB, BP, Epson, General Electric, Halliburton, Nestle, Nike, Princess Cruise Lines, Shell Oil,
Siemens, U.S. Department of Defense, and Wal-Mart.
Agility is a publicly traded company organized into three major business groups. Global Integrated Logistics (GIL) is the largest with
revenues of $4.5 billion and more than 23,000 employees. Over $4 billion of its revenues are generated outside of the U.S. GIL has core
competencies in freight forwarding, contract logistics/warehousing, project logistics, fairs & events, and supply chain management 3PL services.
Agilitys annual freight forwarding volume tops 420,000 ocean trailer equivalent units (TEUs) and its airfreight volume is over 490,000 tons.
Defense & Government Services (DGS) generates $2.2 billion in revenues for Agility and has a workforce of over 10,000. It provides 3PL
services tailored to governments, relief agencies and international institutions worldwide. These services include extensive warehousing and
trucking operations in Kuwait to support U.S. Department of Defense distribution needs in the region.
The final business unit is Investments which draws on local insights from Agilitys global network to identify real estate and private equity
opportunities in Asia, Africa and the Middle East. Investments has revenues of $200 million and employs more than 2,000 people.
Agility focuses on developing 3PL business and solutions for three major internally defined sectors: Technology & Electronics, Retail and
Regional Sectors.
For the Technology & Electronics sector, Agility provides extensive airfreight forwarding services and manages many vendor managed
inventory (VMI) hubs globally. It manages many retail distribution operations globally in the Middle East, Europe and Asia. To support regional
operations, Agility is investing $130 million in India to develop increased warehousing and transportation capabilities. It has been one of the
leading 3PLs in developing projects in higher-risk/higher-return regions of the world.
Supply Chain Solutions Group
Within the GIL business group is the Atlanta, GA U.S. based Supply Chain Solutions (SCS) group headed up by Senior Vice President
Mokhtar Mo Bazaraa. Mos group supports Agility by providing process reengineering and supply chain modeling and optimization services to
internal and external customers. Its services include developing solutions, designing efficient warehousing operations, and modeling, planning
and implementing improved transportation management programs. Agility's Supply Chain Solutions team has designed warehousing operations
for customers such as P&G in Egypt and Morocco and Kraft in Bahrain. It has also redesigned Agilitys own European ground transportation
network, which manages over $500 million in transportation annually.
Case Study: SCS Leverages i2s Transportation Modeler in Developing an Optimal Nigerian Operation
Background: Agility was engaged to redesign and operate a warehousing and transportation management operation for a Fortune 100
consumer goods manufacturer* in Nigeria, Africa.
Current Operation: The current logistics operation includes transportation management of raw and packaged materials (RPM) from Lagos,
Nigerias TinCan and Apapa ocean ports and from local Nigerian suppliers to the manufacturers warehouse in Nigeria. RPM is then shuttled to
the manufacturer's plant and finished product (FP) is loaded and shipped to the warehouse for storage and distribution.
Traditionally all of the shipments were tendered as one-way truckloads from the port, warehouse, and to each distributor. The domestic overthe-road transportation process consists of three main components:
Ocean containers full of RPM are moved from the port to the plant.
20 trucks or 40 trailers full of RPM are moved from domestic suppliers to the plant (currently, this segment is the responsibility of
suppliers and the transportation cost is included in the product pricing).
20 trucks move FP from the plant to distributors (the manufacturer contracts with local trucking companies for this service).
Each of the above components is presently handled independently on a lane-by-lane basis. To gain efficiencies, domestic transportation
needed to be managed as a network and routing and carrier selection must be optimized.
SCS Modeling: There is greater variability in equipment types, road infrastructure, and pickup and delivery facilities in Nigeria versus
developed Western countries. Using i2 Technologies Transportation Modeler (Tmod) software, Agility analyzed historical shipment data in light
of these service and network constraints. From the i2 analysis, it identified network redesign and daily transportation optimization opportunities.
The basic modeling process was as follows:
i2 Tmod Analysis Inputs:
Inbound/outbound shipments to/from the central warehouse.
Business hours of warehouses, distributors, ports, suppliers.
Vehicle/container types & their load capacities.
Loading & unloading times at each location.
Driving distances and transit times between locations.
i2 Tmod Analysis Outputs:
Optimized assignment of shipments to routes:
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o Multi-stop, roundtrip.
o Optimized departure times.
o Selected appropriate vehicle types.
Improved equipment utilization.
From the i2 analysis, Agility was able to identify over $1.6 million in annual transportation spend savings through daily transportation
management and using a network-based transportation management approach versus the lane-by-lane approach. This represented a savings of
over 20%. In addition, the overall carbon footprint of the customer will be dramatically reduced.
The reengineered operation is being implemented by Agility over the next few months. Agility will be responsible for managing the dedicated
central warehouse and all of the transportation from the plant, to and from the warehouse and local suppliers, and to distributors throughout
Nigeria. It will be using Tmod to optimize routes and select carriers on a daily basis. "This operation will be the first to use dynamic multi-stop
truckload optimization in Nigeria, which will further improve the supply chain efficiencies," says Mokhtar Mo Bazaraa.
The combination of using advanced tools such as Tmod and field operations know-how is helping Agility to reduce costs, increase market
share, enhance its speed to market, and replicate its operating model in emerging markets such as Nigeria.
Summary
Agility has made strong strides in growing and developing its global operations since starting its first warehousing operation in 1979. By
leveraging tier-one systems such as i2s Tmod software and focusing on developing optimized integrated supply chain management solutions, we
anticipate that it will play increasingly strategic roles within its customer base.
*At the time of this report the logistics services agreement with the manufacturer was being finalized and therefore its name was not disclosed.
Agility battles headwinds
[By Eric Kulisch and Eric Johnson, American Shipper, June 2010]
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(We have) successfully executed several major contracts, many of which (were done so) under exceptionally difficult conditions, Wexler
said. Anham has not only completed 100 percent of its contract obligations, but has consistently done so on time and on budget.
Wexler said she was unsure whether any of Anhams previous contracts involved the supply of food to U.S. troops, but Managing Director
David Brauss told Reuters in late April that the company intends to build on the successful food supply bid, which is the biggest by dollar value
in the companys history.
We are bidding for 20 to 30 contracts with the U.S. government, Brauss said. We expect to win additional contracts there.
Brauss said Anham had been bidding for the food supply contract for two years and that the price tag may appear higher than it is, with the
cost of food inflating the final bill.
Even though it is a very large contract it is somewhat overstated, and includes surges if more troops come in, he said.
Wexler refused to predict how the competitive landscape might change if Agility is prohibited from participating in government logistics
contracts.
There are highly capable contractors in this arena, and the market is fiercely competitive. But what I can tell you is that we at Anham look
forward to a continued partnership with the Department of Defense, and to meeting or exceeding their expectations as well as those that we
serve every day on this contract, she said.
Meanwhile, a DLA official said the agency has for years been working to improve oversight of vendor conduct.
With respect to this particular food service contract, among the improvements are increased contract oversight and a price evaluation for
every item available for delivery, rather than a representative sampling of items, spokesman Dennis Gauci said. Also, our subsistence supply
chain has negotiated pricing agreements directly with food suppliers.
Aside from these developments, Gauci said DLA started to require invoices be submitted 100 percent of the time in essence, asking for
the bills to back up the costs.
The Defense Logistics Agency operates under the philosophy that American taxpayers shouldnt pay a penny more for logistics services
than is absolutely necessary, Gauci said. Over the past few years, we incorporated additional safeguards in our acquisitions to address
vulnerabilities exploited by contractor fraud. For example, DLA has completely separated product price from the fixed distribution price for its
future prime vendor contracts and requires manufacturer invoices for 100 percent of products. Weve also established a Center of Excellence in
Pricing and we do multiple reviews and audits of prime vendor contracts at regular intervals to ensure the integrity of the pricing process.
Moreover, we have a new financial system in place to include new software that doesnt have the vulnerabilities found in the previous
system. The system is designed to help us identify potential fraud activities.
Wexler said heightened scrutiny by the DLA is welcome.
Anham has received the highest evaluations and recommendations from both private and public institutions who cite the companys ability
to execute contracts consistently on time and within budget, she said.
Agilitys Defense & Government Services division has lost a significant number of opportunities to win business, beyond the food supply
contract that went to Anham, because it has been unable to pursue new government contracts for the past six months.
Prolonged suspension could have a material impact on the groups government-related business and may result in the associated assets
being impaired, Agility said in its 2009 annual report.
Agility is also in a dispute with defense contractor DynCorp International, which dropped the 3PL from its team in December after winning
a large task order last summer to provide logistics services to the Army in southern Afghanistan under the controversial LOGCAP program.
The Logistics Civil Augmentation Program was originally awarded by the Bush administration as a sole-source contract to Halliburton
subsidiary Kellogg Brown & Root to provide logistics services during the early days of the war in Iraq. DynCorp was one of three companies
that the Army pre-qualified to bid for work in the latest version of the contract.
Agility argues that government rules allow it to continue work under existing contracts. DynCorp said in July that the one-year deal was
worth $643.5 million. Agility has said four option years bring the total value of the contract to $5.9 billion. Agility was to receive 30 percent of
the contract for airfield support.
But, as Mark Twain might say, reports of Agilitys potential demise may be greatly exaggerated. Companies have been indicted for defrauding
the U.S. government or violating other laws and continued to survive and thrive. The ability to rebound usually depends on whether the illegal
activity was rampant or contained to a few bad apples, and how quickly the company implements stricter internal compliance policies and
oversight.
Since 2005, the top 10 defense contractors in the United States have settled 55 civil, criminal or administrative cases involving contract fraud,
and environmental, ethics and labor violations, and have all resumed business with the U.S. government, according to a database maintained by
the independent Project on Government Oversight. Agility, which received $2.1 billion from the U.S. government last year, has only one
instance of misconduct since 1995 compared to 50 for Lockheed Martin, the worlds largest defense contractor.
Agilitys attempt to settle the dispute suggests it is trying to ensure a path to reenter the government marketplace as quickly as possible.
Even if Defense & Government Services is barred from U.S. government work for a while, it still has clients among non-governmental relief
organizations and international agencies, as well as militaries in Europe and the Middle East.
In the logistics sector, Swiss freight forwarder Panalpina has dealt with the fallout of being accused of providing bribes to government
officials in Nigeria to secure preferential customs treatment without any noticeable defection of customers concerned about its long-term
viability or ethical practices.
In late April, Panalpina said it had nearly completed a settlement agreement with U.S. authorities over alleged violations of the Foreign
Corrupt Practices Act in Nigeria, Saudi Arabia and Kazakhstan, and had reserved $110.7 million to cover anticipated fines, penalties and legal
expenses. Panalpinas behavior in Nigeria is also under investigation by the European Commission.
The company has taken steps to prevent future payments to foreign officials, such as instituting tighter internal controls, pulling out of
Nigeria and restructuring operations in West Africa.
Price-fixing scandals in recent years have also plagued dozens of air cargo carriers, air freight forwarders and U.S.-flag carriers such as
Horizon Lines and Sea Star that provide coastal shipping to Puerto Rico and other locations.
If youre doing a good job with commercial clients and you credibly communicate that something went sideways, weve corrected the
situation and it wont have an impact, you can survive, said Brian Clancy, managing director for MergeGlobal, an Arlington, Va.-based
company that provides strategic consulting for the transportation and logistics industries.
I think theyll live to fight another day. This industry is very relationship oriented and if youre doing business with someone who is doing a
good job, youll probably continue to do business with them, said Tom Connolly, a principal at transportation investment advisor Eve Partners.
Agilitys misstep is more serious because it affects the companys core business compared to Panalpinas skirting of the rules in order to
conduct business in some developing economies, logistics industry consultant Dick Armstrong insisted.
Everyone knows that Nigeria is corrupt. You know in Africa, to stay alive, you have to know who to pay off to get anything accomplished.
One way or another, youre going to have to take care of the local guys or youre not going to do business.
Trying to do business in a place like Nigeria in the way you do it in Amsterdam is pretty tough, said the head of Stoughton, Wis.-based
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Logistics Leader accomplishes another success in the oil and gas sector
The Khafji Joint Operations (KJO) awarded a contract for fourth party logistics (4PL) warehousing and solutions in Al-Khafji, Saudi Arabia
to Agility. The five year contract with a potential value of US$ 17 million was announced at a recent signing ceremony.
A partnership between Kuwait Gulf Oil Company (KGOC) and ARAMCO Gulf Operations Company (AGOC), the KJO conducts onshore
and offshore activities related to exploration and drilling for Oil and Gas in the Divided Zone. With operations in both Saudi and Kuwait,
KGOC represents the State of Kuwait in the Divided Zone and was established in an effort to improve cooperation for Oil and Gas
development projects between Kuwait and Saudi Arabia.
Over the 5 year span of the contract, Agility will provide all inclusive on-site warehousing management and operation services, including
material receiving and handling services, as well as opening, inspecting, labeling, marking, bar coding, transferring, storing, issuing and
transporting materials to users at different units within Khafji. Other types of services in this category include housekeeping of yards and
warehouses, documentation and inventory assistance, receipt of materials in addition to technical and administrative support services, material
handling (containers loading and offloading, stuffing and de-stuffing).
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The contract represents yet another success for Agility's operations within the Oil & Gas and Government sectors within the past years. Such
long-term contracts have played a major role in broadening the company's experience in 4PL operations and other specialized services.
"It is very exciting for us to have won this contract with the KJO. Agility has successfully managed several contracts in the Oil & Gas sector
over the past years. This new contract with KJO demonstrates their confidence in our capabilities and will help in strengthening our relationship
with them", said Engineer Dakheel AI-Dakheel, Director of Business Development Department at Agility This contract will allow KJO to
concentrate on their core competency, which is oil exploration without having to invest time or efforts into reliable storage or transportation
issues, he added.
Along with the deliverables mentioned in the contract, Agility will also provide KJO with other specialized services; inspection, site delivery,
inventory management and reporting.
Ali Mikail, CEO, Agility Global Integrated Logistics (GIL), Kuwait highlighted, In addition to our existing freight forwarding, customs
clearance and complete 4PL support, we provide KJO with all the logistics services they require. With Agility's intensive presence in the region
and our comprehensive portfolio of specialized services; we are well equipped to support the growing demands of the fast paced oil and gas
sector in Saudi Arabia and Kuwait thus making us an ideal partner in this industry."
Agility is currently working with a number of prestigious local and international Oil & Gas companies and continues to drive its efforts to
develop a growing presence in this sector.
A Dialogue with the Chairman on Agilitys Direction for 2010
Tarek Sultan talks about first quarter earnings, impact of legal dispute, and company strategy
Historical Context: 2003 to 2009
Since 2003, Agility has developed a world-class commercial logistics business to complement its government contracting portfolio. That
development has expanded Agilitys geographic footprint around the world, established our leading position in emerging markets, and added
specialized capabilities to help us meet the needs of niche market segments.
Today, Agilitys commercial logistics arm, Global Integrated Logistics (GIL) operates in 120 countries and serves over 50,000 customers. Our
operational platform is distinguished by its strength in high-growth emerging markets: China, India, and the rest of Asia; the GCC and the rest
of the Middle East; Russia and Eastern Europe; and Latin America. And we offer specialized logistics solutions around Chemicals, Fuels, Fairs
& Events, and Project Logistics.
We also have diversified our Defense & Government (DGS) business. Our focus has been on expanding our business with the US
government in geographies outside of Kuwait and Iraq, as well as attracting other governments, international organizations, and nongovernmental organizations as customers. Finally, we acquired a group of non-Agility branded companies working in the areas of industrial real
estate management, aviation and ground handling, and customs modernization and e-government solutions, which are grouped together under
Agility Infrastructure.
From modest roots in Kuwait, Agility became an acknowledged global top ten global logistics player. We bring global scope, flexibility, and
specialization of services to complex logistics challenges. We take pride in our commitment to personal service. Our customers consistently
acknowledge that Agility goes above and beyond.
2009: Mastering a Challenging Year
The global financial crisis of late 2008 and the subsequent great recession of early 2009 tested the resilience of Agility and the logistics
industry. Commercial freight volumes declined across the industry as international trade volumes contracted on a sustained basis for the first
time since the 1930s. Profit levels for nearly every logistics service provider were down substantially versus 2008 levels.
Agility navigated this challenging year better than most logistics service providers. Net profit for 2009 was KD 156.4 million, up 10.6% over
2008 levels. This slight increase against such market conditions was due to several factors:
Early adjustment of resource levels in the commercial logistics business, beginning in late 2008, as we saw the slow peak season as an early
warning sign for a broader economic slowdown
Continued strong volumes through existing government contracts in Kuwait and Iraq, driven by sustained high troop levels
New revenue and profits from network expansion into Brazil, Mexico, as well as new government contracts outside the Middle East
2010: A Pivotal Year
We are aware that 2010 is a pivotal year for Agility because of the US troop drawdown in Iraq and subsequent phasing-out of some of our
large government contracts. This year is the final option year for US government contracts that have historically contributed 25%-35% of Agility
s annual revenue.
Although Agility anticipated and planned for the inevitable troop drawdown in Iraq, there are two additional, unplanned challenges that the
company has also had to contend with in the last year.
The first is the global recession that jolted the world at the end of 2008, along with the slower-than-expected recovery from that recession.
The global slowdown has an ongoing impact on our Global Integrated Logistics (GIL) business.
The second is the legal proceedings by the US government which led to the suspension on winning new government business. This has
had a deep impact on our Defense & Government Services (DGS) business.
Together, these three challenges have created a changed financial landscape for Agility in the near-term. I want to explain our financial
position today and, more importantly, our plans going forward.
First Quarter Results
Year-over-year comparison of profit levels going forward would be misleading, since Agilitys profits were up in 2009, in stark contrast to the
dramatic declines in profitable for the rest of the industry. Going forward, Agility will measure current quarterly performance versus the previous
quarter. This approach more accurately reflects the nature of business, in which large contracts ramp up over time and then decline as they reach
the end of their contractual term.
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Management focuses on net income and free cash flow. While we expect net income to decline in the near term, driven by the three
challenges above, we plan to mitigate their impact through aggressive management of cash, and we expect free cash flow to be less severely
impacted.
Our first quarter results are as follows:
Revenues have declined by KD 67.7 million or 14.4% compared to Q4 2009. Our revenue in Q1 2010 is KD 403 million. To break these
numbers down further:
o DGSs revenues declined 28.8% in Q1 of 2010 to KD 131.7 million compared to Q4 2009, mainly due to falling volumes in US
government contracts as the troops withdraw from Iraq. As a result of the US government suspension on new business, the company was
unable to supplement this anticipated revenue decline with new revenue growth in Afghanistan and other parts of the world.
o GIL revenue decreased by 5.8% or KD 17.4 million in Q1 of 2010 when compared to Q4 of 2009. GIL revenues now stand at KD
279.4 million. This is primarily due to typical seasonality witnessed in commercial logistics when comparing fourth quarter revenues to the
current quarter. Nevertheless, underlying business in GIL has grown compared to Q1 2009. Revenues compared to Q1 2009 are 14% higher.
o Agility Infrastructure companies contributed KD 20.8 million to total revenue, an increase of 22.7 % over Q4 of 2009. Agility
Infrastructure has consistently shown healthy growth in the base business over the course of the last several years.
o However, net revenues for GIL have declined by 17.8% for Q1 of 2010 compared to Q4 of 2009. This is because carrier prices, which
fell in the early days of the global financial crisis, have been steadily rising. This has put pressure on freight forwarding margins industry-wide.
In combination, these factors have the following impact:
o Operating profits are KD 18.9 million in Q1 of 2010, a 55.3% decline since Q4 of 2009. This decline is driven by the reduction in
volumes in the defense and government services business, and the pressure on GILs net revenue margins, as discussed above.
o Cash from operations stands at KD 62 million in Q1 2010, a 33% increase over Q4 2009. Free cash flow for the quarter stands at KD
47 million, an increase of 404% over Q4 2009.
o Net income is KD 17.6 million in Q1 2010, as compared to KD 40.8 million for Q4 2009. This results in Earnings Per Share of 17.5 fils
for this quarter, compared to an EPS of 40.6 fils in Q4 2009.
What this Means in the Near Term
Our investors, customers, employees, suppliers, and partners will want to know what these numbers mean and what they can expect from us
in the near-term.
Agilitys overall vision and strategy have not changed in the face of these challenges. However, we must adjust timelines and tactics.
Realistically, 2010 will be a year of transition for the company. Agility is likely to face declining profitability over the course of the next four
quarters, as a result of major US government contracts winding down in Iraq, recovery from the global recession, and the financial impact of the
legal dispute with the US government.
In order to reverse the decline in profitability, we will aim to grow revenue organically, accelerate realization of return on investment, reduce
costs prudently, and maximize yields on core operating assets.
While net income may decline over this period, we will focus on cash management throughout the business. We expect that free cash flow
will be the key metric to guide us on the health of the business.
To give you additional information at the business-group level:
The Defense & Government (DGS) business has been set back by the combination of the troop drawdown and the legal case with the US
government. If the company is able to settle the dispute, then DGS will focus on aggressively rebuilding its business, reinvigorating business
development and customer outreach. If we cannot reach a mutually-agreeable settlement, then we would need to assess all strategic options for
the DGS business. For now, the situation is fluid and no decision has been made, but we have contingency plans in place.
The relative importance of the Global Integrated Logistics (GIL) business has grown in the face of uncertainty around DGS. GILs strategy
remains the same, but timelines will be accelerated. GIL will continue to focus on growth, performance, and innovation. Growth strategies are
centered around a tradelane development program and on growing business with global accounts. Performance strategies are focused on
controlling overhead costs, maximizing returns on assets, and managing cash. Innovation strategies are centered on transforming our operations
platform and investing in technological modernization which will lead to productivity improvements.
In financial terms, there are some things you should know:
Above all, we are committed to greater discipline. Already in the first quarter of 2010, operating expenses were KD 9 million lower than
operating expenses in the fourth quarter of 2009. This is a result of our cost-containment efforts and initiatives to reduce overhead expenses. We
will continue to reduce our costs prudently.
Global Integrated Logistics (GIL) will strengthen its focus on managing working capital we have already made significant investments in
building a global platform in the past, and we now seek to achieve superior returns on that investment.
Although we are facing challenges, I see them as a catalyst for change. I believe that with a commitment to discipline, Agility will emerge
stronger, more flexible, and more competitive.
Agility loses DLA contract as legal wrangle continues
The US Defense Logistics Agency (DLA) has named a new contractor for food and beverage support to US forces in Iraq, Kuwait and
Jordan.
Dubai-based Anham is set to replace Agility as prime vendor by fall. Agility said it had been asked to continue providing services for six
months to ensure an orderly and seamless transition as troops are redeployed and the new contractor beds in.
The six-year contract for Anham could be worth up to $6.4 billion. The company was set up by Arab Supply and Trading Co, based in Saudi
Arabia, the Jordanian Munir Sukhtian Group, and HII-Finance Corp, a US-based investment group and international trade organization.
Agility was indicted last November on charges of conspiracy and fraud while operating contracts worth $8.5 billion to supply food to US
troops in the Middle East. The case is now in a federal court and if the company is found guilty of overcharging the Department of Defense, it
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could face a substantial fine or be suspended from bidding for future contracts.
One former supplier claimed Agility had profited by $60 million by overcharging for fruit and vegetables. The company is also cited for
failing to pass on discounts it obtained from US suppliers. The company denies all allegations. It said in a statement it was continuing to discuss
the issue with the US government but added: There is no guarantee that the parties can reach a mutually agreeable settlement.
Agilitys Kuwait-based parent company and legal entity is Public Warehousing Co (PWC). PWC Logistics, already a key player in the Middle
East warehousing and trucking market, bought GeoLogistics, Trans-Link Group and US-based Transoceanic Shipping in 2005 to cement its
position as the regions largest locally based logistics company.
PWC rebranded as Agility the following year and, in addition to its expanding commercial operations, became the major provider of logistics
services to the US military in the Middle East.
On April 12, the US Attorneys office in Atlanta extended an indictment against The Public Warehousing Company KSC to two PWC
subsidiaries, DGS Holdings and DGS KSCc.
Agility said in a statement: The decision by the US Attorneys office in Atlanta is regrettable. The indictment contains no new allegations,
and simply adds two PWC affiliates as defendants. This move serves only to taint PWC subsidiaries that have a strong record of on-the-job
performance and compliance with US law and federal acquisition regulations.
The company is currently pursuing a technicality and claims the US Justice Department, in attempting to serve a summons on the indictment,
failed to follow US law. Rather than serve PWC through proper diplomatic channels in Kuwait, the US government attempted to serve a US
subsidiary of the company. Under the US Federal Rules of Criminal Procedure, a company cannot be served with process on an indictment
through service to a subsidiary.
In a further statement, the company said: PWCs work on the food contract has been timely, reliable and cost effective. Its performance,
under the most dangerous and demanding conditions, has been unparalleled.
The prices it charges have been negotiated with, agreed to, and continually approved by the US government, which has found PWCs prices
to be fair and reasonable.
The company added that it had a strong, compelling legal case and delayed the release of its 2009 financial results by a few days until April
11 in the ultimately futile hope of resolving the case out of court.
Finally reporting the results, Tarek Sultan, chairman and MD, said: 2009 was a mixed year for Agility. The company was able to report solid
operational profits, continue to grow its emerging market footprint, and attract a number of important new customers around the world. On the
other hand, Agility is facing a number of challenges, including the slower than expected recovery from the global economic recession, the troop
drawdown in Iraq, and the ongoing legal issues.
Agility saw 2009 revenues decline by 7 percent as a result of decreasing freight volumes in its Global Integrated Logistics (GIL) business.
Staff cuts and other cost control measures helped ensure an increase of 5 percent in operating profit and an 11 percent improvement in net
profit. No provision has been made for a legal settlement. GILs revenue fell by 13 percent despite contract wins including Nokia, Mattel,
Formula One Management UK and Yas Marina Circuit. The division expanded its network in emerging markets through new facilities in
Malaysia, Singapore and Saudi Arabia, and opened offices in Poland and Ukraine.
Acquisitions were made in Brazil and Mexico, and Agility signed a memorandum of understanding with Qatari-based logistics company
GWC to merge operations cost and cash management initiatives to align local business levels with customer requirements.
Agilitys government contracting business, Defense & Government Services, increased its revenues in 2009 by 4 percent.
Sultan added: It has been a tough year, for the global economy, for the logistics industry, and for Agility. Yet we have performed well in
these challenging times. Agility is differentiated by a strong emerging market platform, specialized logistics capabilities, and complementary
businesses that provide a competitive advantage as well as operating efficiencies. Our path forward will be focused on growing revenue
organically, reducing our costs prudently, and maximizing yields on core operating assets.
Agility employs more than 32,000 but laid off 600 personnel in March and is expected to shed thousands more in the coming months.
Agility to pay $600m to settle fraud charges
Reaches preliminary deal with the US government to clear sum over a three-year period
Kuwait: Kuwait's logistics firm Agility is to pay the US government $600 million (Dh2.3 billion) to settle fraud charges, an Arabic-language
daily reported yesterday, citing unnamed sources.
Agility and the US government reached a preliminary agreement and the sum would be paid over three years, Kuwait's Al Jarida newspaper
said.
The Kuwaiti firm, formerly known as Public Warehousing Co KSC, is in talks to resolve an indictment accusing it of overcharging the US
Army on supply contracts in Iraq, Kuwait and Jordan.
The company has delayed the release of its financial results until tomorrow and requested a trading halt on its shares, pending clarity on talks.
Al Jarida said the settlement will mean the return of US government business to Agility, but it was not clear yet if that would be in full or in
part.
Settlement
It said the settlement could be announced "in a day or two."
"It [the settlement]... could include some slight changes, especially regarding the return of all contracts or the majority of them," the paper
said.
Agility was not immediately available to comment.
Kuwait has become a major logistics base for US forces since the 2003 American invasion of Iraq.
Agility said on Tuesday it will postpone the release of its 2009 financial results until April 11 as it tried to reach a settlement with the US
government on a fraud case.
Agility is publicly listed on the Kuwait Stock Exchange and on the Dubai Financial Market with more than 15,000 investors holding shares.
The company has over 550 offices in 120 countries, with a growing presence in emerging markets.
Its business groups comprise global integrated logistics, which serve commercial customers in technology, retail, chemicals, and a wide range
of other industries, and infrastructure.
These support the needs of the industrial real estate, customs optimization, and airline services industries, primarily in the Middle East,
Africa, and South Asia., and the defense and government services sector, which has been set up to provide logistic services to government and
military agencies, relief organizations, and international institutions.
Agility tabs Hickler for Asia-Pacific role
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Agility has appointed Hans Hickler as chief executive officer of its Asia-Pacific region.
Hickler joins Agility from DHL, where he was CEO for global customer solutions, based in the United States. He was responsible for leading
the development and sale of customer services for all DHL business units including DHL supply chain, warehousing and distribution,
forwarding and express products. Previously, Hickler served as CEO of DHL Express USA and earlier in his career was CEO of APL Logistics.
He will be based in Hong Kong.
Hickler replaces Wolfgang Hollermann, who will transition to a new role as advisor to Essa Al-Saleh, Global Integrated Logistics (GIL)
president and CEO.
18th Edition
Page 32 of 625
(502) 2326-0401
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1991
Asset Focus:
Market Area:
Founding Business:
Central America
Shipping Line Agency
OVERALL CAPABILITY
Overall Capability of Provider:
Capable customs broker/transportation manager with bonded warehousing thoughout Central America.
KEY PERSONNEL
Geoff R. Holbik
President
Herbert Archila
Oscar Robles
Jose Cruz
Accounting Mgr.
15
Ticker Symbol
15 **
Exchange:
350
3
1-2
ASSETS
Total Transportation Assets:
Total Tractors:
100
Total Trucks:
Total Trucks:
15
Total Other:
Total Trailers:
Total Aircraft:
185
Total Ocean:
1
2
Total Other:
Total Reefers:
Total Flatbeds:
0.11
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Page 33 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
APL
Shipping
BASF
Chemicals
Guatemala
Bayer
Chemicals
Guatemala
Office Depot
Specialty Retailers
Central America
Panasonic
Guatemala
Telefnica
Telecommunications
Central America
Xerox
Latin America
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 34 of 625
Asia/Pacific
Europe
North America
Aimar
Latin/South America
Belize
Costa Rica
El Salvador
Guatemala
Honduras
Nicaragua
Panama
EDITOR'S COMMENTS
Aimar's market area is Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua where it has five
warehouses.
Provider's Strengths
Regional transportation management and bonded warehousing throughout Central America.
Provider's Weaknesses
Size and scope.
18th Edition
Page 35 of 625
506-2239-8282
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1991
Asset Focus:
Market Area:
Founding Business:
International
Air Cargo Agent
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Nuria Rodriguez
CEO
Elmer Caldern
Romulo Ugalde
Sales Supervisor
General Mgr.
Jorge Araya
Gustavo Villalobos
Finance Mgr.
Operations Mgr.
Ticker Symbol
8 **
Exchange:
77
115
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
18th Edition
EDI Handling
ERP Interfaces
Page 36 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Intel
San Jose
San Jose
Wal-Mart Stores
General Merchandisers
San Jose
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 37 of 625
Asia/Pacific
Europe
North America
Aimi Cargo
Latin/South America
Costa Rica
Nicaragua
EDITOR'S COMMENTS
Aimi Cargo specializes in the following industries: perishables, electronics, pharmaceuticals, textiles and
hazardous goods.
Provider's Strengths
Imports/Exports management.
Provider's Weaknesses
Size and scope.
18th Edition
Page 38 of 625
506-2260-6125
COMPANY BACKGROUND
Parent Corporation:
Grupo Guardian
Asset Focus:
Market Area:
Founding Business:
Central America
Inventory Administration
Logistix, S.A.
OVERALL CAPABILITY
Overall Capability of Provider:
Capable provider serving all of Costa Rica with distribution to Central America.
KEY PERSONNEL
Rafael Mora Chinchilla
CEO
Elizabeth Sanchez
Francisco Chacon
CFO
CIO
Ticker Symbol
5 **
Exchange:
145
3
3
ASSETS
Total Transportation Assets:
Total Tractors:
6
Total Trucks:
Total Trucks:
13
0.2
Total Other:
Total Trailers:
Total Aircraft:
1
12
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): RedPrairie
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Paragon-Tecsys
RedPrairie
18th Edition
RedPrairie
EDI Handling
ERP Interfaces
Page 39 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
BASF
Chemicals
San Jose
Beiersdorf
San Jose
Clorox
San Jose
Coamesa
San Jose
San Jose
Grupo Numar
Food Production
San Jose
Kimberly-Clark
San Jose
Reckitt Benckiser
San Jose
Sabritas
San Jose
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 40 of 625
Asia/Pacific
Europe
North America
Almacenadora
Latin/South America
Costa Rica
Guatemala
EDITOR'S COMMENTS
Almacenadora runs modern warehousing and distribution operations to Central America from Costa Rica.
Provider's Strengths
Capable, warehousing 3PL; accessibility.
Provider's Weaknesses
Size and scope.
18th Edition
Page 41 of 625
52 (55) 53-18-03-38
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1988
Asset Focus:
Market Area:
Founding Business:
Mexico
Bonded Warehousing
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Lic. Elas Guerra Escobar
CEO
14
Ticker Symbol
11 **
Exchange:
350
250
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
6
60
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
50
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Promo System
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Opera System
Salomon Admin System
18th Edition
EDI Handling
ERP Interfaces
Page 42 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Kraft Foods
Mexico
LG
Mexico
Mattel
Mexico
Panasonic
Mexico
Wal-Mart Stores
General Merchandisers
Mexico
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 43 of 625
Asia/Pacific
Europe
North America
Latin/South America
Mexico
EDITOR'S COMMENTS
ADEMSA mainly services the food and grocery, retail, consumer goods, and electronics industries.
Provider's Strengths
Bonded warehousing.
Provider's Weaknesses
Size and global reach.
18th Edition
Page 44 of 625
52 (33) 36-68-07-84
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1936
Asset Focus:
Market Area:
Founding Business:
Mexico
Warehousing
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Luis A. Garca Serrato
General Director
Eduardo Hernndez
Logistics Manager
CTO
21
Ticker Symbol
21 **
Exchange:
800
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
11
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): RedPrairie In-Transit Control
Transportation Planning and Optimization:
Warehouse Management System (WMS):
18th Edition
EDI Handling
ERP Interfaces
Page 45 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ASERCA
Food Production
Mexico
Eastman Kodak
Mexico
Industrial Machinery
Mexico
Nissan Motor
Mexico
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 46 of 625
Asia/Pacific
Europe
Almacenadora Mercader
North America
Latin/South America
Mexico
EDITOR'S COMMENTS
ALMER provides warehousing and distribution of grain and other agricultural products. Because of
technological upgrades it has made over the past few years, it has been able to branch out into other industry
verticals.
Provider's Strengths
Warehousing and distribution of grain.
Provider's Weaknesses
18th Edition
Page 47 of 625
57 (1) 657 55 90
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Colombia
Banking
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Omar Gonzlez Pardo
President
Diana Carolina Padilla Esco Marketing & Communications Coordina Jorge Ivn Acevedo Echever Finance Mgr.
Robinson Vsquez Escobar Logistics & IT Mgr.
Ticker Symbol
104
13 **
3,407
935
4-6
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
25
10
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Simplexity--AsTrans
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Simplexity--AsTrans
Atos Origin--SISLOG
18th Edition
Freight Mexico
Microsoft Axapta
EDI Handling
ERP Interfaces
Page 48 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Colombia
Colombia
Andercol S.A.
Chemicals
Colombia
Auteco
Transportation Equipment
Colombia
Avantel
Telecommunications
Colombia
Bavaria
Beverages
Colombia
Baxter Healthcare
Colombia
Bayer
Chemicals
Colombia
bioMrieux
Pharmaceuticals
Colombia
Carrefour
Colombia
Coca-Cola
Beverages
Colombia
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Colombia
Page 49 of 625
Asia/Pacific
Europe
North America
Almagran
Latin/South America
Colombia
Ecuador
Venezuela
EDITOR'S COMMENTS
Almagran y Almacenar provides VAWD throughout Colombia, Ecuador and Venezuela. Most of its customers
are in the food and beverage, consumer goods, pharmaceuticals, and retailing industries.
Provider's Strengths
VAWD in Colombia.
Provider's Weaknesses
Although the storage company was affected by the economic crisis in 2009, it achieved a sales growth of 1.08 %. The line of business most
affected was that of logistics. The line of document management saved the years of this company.
After consolidating the merger between the old Almagran SA Trade Warehouses, Almacenar, in 2008 , the new company faced in 2009 at a
time of global economic crisis.
The results in 2009 were not spectacular, but obtained positive growth in your sales. The company's revenues increased from $185,000
million in 2008 to $187,000 million in 2009, which means they got an increase of 1.08%.
"We were lucky as we had positive growth despite the economy did not grow anything," said Omar Gonzalez Pardo, president of Almagran
and Almacenar.
For logistics, the company received $166,500 million revenue in 2009. The warehouses, distribution centers and platforms generated 57% of
the revenue of this business line, $107,000 million.
For document management revenues in 2009 were $20,500 million, almost 11% of total company revenues.
In its line of document management business, Almagran and Almacenar handle all the value chain of this service: storage, consulting,
custodial, retrieval, distribution, creation and document authentication.
A growing line
The business line that saved the year in terms of sales and give recognition to this company was to document management.
While logistics revenue between 2008 and 2009 grew at about 0.29%, the revenue generated by document management increased between
8% and 10%.
Document management is a business line that has been in the company 10 years, but thanks to technological advances, decreased
consumption of paper and document outsourcing, has grown to represent nearly 11% of their income.
According to its president, which made the difference of the storage company in document management is the quality level offered to their
customers. "Document management is a business line that works with quality," said the manager.
For its level of quality has been classified by Bureau Veritas, Bancolombia Organization and Abbott.
In August last year, the audit firm Bureau Veritas Company awarded ISO 9001 certification in customs agency processes, distribution centers
and document management.
Also, it was rated as the best provider of Bancolombia Organization, through an annual evaluation of all users of the document management
service that does this organization.
The multinational Abbott was awarded the Certification of Quality Assurance and Service Excellence, under the certification program
providers that are this company.
What's next for the company?
Among the projects Almagran and Almacenar for 2010 are international development and an investment plan worth U.S. $5 million. They
expect the company's growth of 10%.
The strategy for achieving the international development of the company will be through acquisition or strategic alliances with some leading
companies in the logistics chain in the countries of the Andean Community and Central America. From the list of countries ruled Venezuela,
where the political crisis and not present.
The investment plan for 2010 totals U.S. $5 million, of which 20% will be for the development of technology and more efficient systems for
document management.
For next year, have a sales growth goal of 10%, expects its two business lines to achieve the end of 2010 have grown at this rate. "The
growth of our company depends mainly on the growth of our customers," concluded the manager.
Exel and Almacenar sign agreement of cooperation
Bogot, Colombia Almacenar, the logistic operator leader in Colombia, signed an agreement of technical cooperation with Exel, the global
leader in the administration of the supplying chain. "Exel is a leader recognized in the logistic world and under this agreement of cooperation,
Almacenar will be able to provide logistics, distribution, and other services of the supply chain to the increasing market of outsourcing in
18th Edition
Page 50 of 625
Colombia, using the highest technology and its global processes", commented Omar Gonzlez, President of Almacenar. "The presence of Exel
in Latin America has high strategy of value for our clients and this alliance with Almacenar wonderfully complements the network established in
Mexico and South", assured Humberto Flrez, Vice President of Contract Logistics, Latin America, during the ceremony of companies signing
the agreement.
18th Edition
Page 51 of 625
almaviva@almaviva.com.co
57 (1) 338-4380
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
South America
Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
Capable large South American warehousing 3PL with modern distribution operations.
KEY PERSONNEL
Pedro Echeverria
CEO
Ariel Noriega
German Mauricio Bernal
CFO
CIO
48
Ticker Symbol
48 **
Exchange:
1,400
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
2.5
5
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Food, Groceries
Healthcare
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Provia
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Provia
FourSite
Logisnet
FourSite
18th Edition
EDI Handling
ERP Interfaces
Page 52 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
BP
Petroleum Refining
Colgate-Palmolive
Eli Lilly
Pharmaceuticals
Ford Motor
General Motors
Heineken
Beverages
LG
SABMiller
Beverages
Samsung Electronics
Sony
Unilever
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Page 53 of 625
Asia/Pacific
Europe
North America
Almaviva
Latin/South America
Chile
Colombia
EDITOR'S COMMENTS
Almaviva S.A. provides distribution throughout Columbia with 28 warehouses in 20 locations.
Provider's Strengths
Capable South American 3PL with broad coverage in a difficult area.
Provider's Weaknesses
18th Edition
Page 54 of 625
57 1 488-0098
COMPANY BACKGROUND
Parent Corporation:
Banco Popular
Asset Focus:
Market Area:
Founding Business:
South America
Bonded Warehouse
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Leonardo Delgado Jaramillo CEO
Maria Cristina Farcas
Jose Tibamoso Hurtado
Marketing
Logistics
Nelson Valbuena
Miguel Amezquita
CFO
CIO
14
Ticker Symbol
14 **
Exchange:
280
260
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
1.1
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
FourSite
18th Edition
FourSite
EDI Handling
ERP Interfaces
Page 55 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
BASF
Chemicals
Colombia
Bayer
Chemicals
Colombia
Corbeta
Colombia
DuPont
Chemicals
Colombia
General Motors
Colombia
IMUSA
Colombia
Peldar
Packaging, Containers
Colombia
Sidetur
Metals
Colombia
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
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Asia/Pacific
Europe
North America
Alpopular
Latin/South America
Colombia
EDITOR'S COMMENTS
Alpopular is a Columbia-based 3PL owned by a bank.
Provider's Strengths
Capable 3PL in a tough location.
Provider's Weaknesses
Limited geographical range.
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55 41 2141-7484
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Asset Focus:
Market Area:
Founding Business:
South America
Railroad Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Bernardo Hees
CEO
1,408
1,236 **
Exchange:
4,007
BOVESPA
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
150
Total Trucks:
100
Total Trucks:
650
Total Trailers:
Total Aircraft:
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.45
Total Tankers:
Total Other:
5,000
MAJOR MARKETS
Automotive
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Translogic
Transportation Planning and Optimization:
Warehouse Management System (WMS):
SOL
SAP
18th Edition
SAP
EDI Handling
ERP Interfaces
Page 58 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Food Production
Paran
Amaggi
Food Production
Sudeste
Big Frango
Food Production
Paran
Bunge
Food Production
Sul do Brasil
Cargill
Food Production
So Paulo
Frangosul
Food Production
Gerdau S.A.
Metals
Sul do Brasil
Perdigo
Food Production
So Paulo
Petrobras
Petroleum Refining
Rio de Janeiro
Food Production
Itirapina
Sadia S.A.
Food Production
Paran
Scania
Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 59 of 625
Asia/Pacific
Europe
North America
EDITOR'S COMMENTS
ALL owns and operates a large asset base which includes a rail network 21,300 kilometers long, 1,095
locomotives, 31,650 railcars, and a total of 650 vehicles. Agricultural commodities are 67% of ALLs revenue and
industrial products account for 33%. Eighty-five percent of ALLs transportation is done by rail, 4% by road and
11% is intermodal (rail/road). Ninety-five percent of its revenue is Brazilian-based.
Provider's Strengths
Railroad logistics.
Provider's Weaknesses
With an investment of R$1 million, Cruz Alta terminal will allow reefer and dry containers to be transported to the Port of Rio Grande through
ALLs railway network
Latin Americas largest rail-based logistics operator, ALL (Bovespa: ALLL11) has established a partnership with Standard Logstica, the only
provider of refrigerated intermodal logistics solutions operating in the three states of the Southern region and in the Southeast and CentralWestern regions of Brazil, to operate the Intermodal Cruz Alta Terminal (Rio Grande do Sul State).
With an initial capacity to handle 300 containers per month, reaching a volume of 700 containers by December, the Terminal will receive
logistics infrastructure investments totaling R$1 million. The operation is scheduled to start in September, after the conclusion of site work, the
installation of outlets for reefer containers and the purchase of equipment. Container transportation is one of ALLs main focuses for this year.
We will invest around R$55 million with partners and expect to double this volume. In July, we started operating the Alto Taquari Terminal in
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partnership with Standard, and the Ponta Grossa and Telmaco Borba Terminals, in Paran State are scheduled to begin operating in the next
few months, ALLs director of manufactured products Sergio Nahuz said.
Producers of Rio Grande do Sul and Santa Catarina States will be able to transport their goods over the 738-km railway, departing from Cruz
Alta and arriving at the Port of Rio Grande. This will be the seventh terminal operated by Standard covering ALLs railway network, and we
believe in trains as a strong and advantageous means of transportation, remarked Standards Management Director Alan Fuchs. Since the
initiating its partnership with ALL, the company has invested around R$70 million in the implementation of Intermodal Terminals.
With this new structure, Standard has strengthened its presence in Rio Grande do Sul State, currently transporting through the Esteio
Terminal a monthly average of 500 containers to the Port of Rio Grande through ALLs railway network, Fuchs said. According to him,
Standard Logstica has invested in ALL as cargo transportation partner since 2006, when the company formalized an agreement with ALL for
container movement, connecting Standards Esteio Terminal (Rio Grande do Sul State) with Tecon Terminal of Containers of Rio Grande
(Rio Grande do Sul State).
A History of Success ALLs operation transporting refrigerated products by train began in 2003 for Sadia, followed by other companies
such as Frangosul, Seara, Perdigo, Big Frango and Jandelle. Since then, ALL grew more than 20 times in volume of refrigerated products,
consolidating the success of the operation.
Initially, this operation depended on a railcar generator connected to the containers through electrical cables, maintaining the cargo
refrigerated. In 2006, in partnership with Standard, ALL implemented a new solution that reduced the operations diesel consumption. Together
the two companies made Brazils first refrigerated express train possible, connecting Standards Esteio Container Terminal (Rio Grande do Sul
State) with Tecon Terminal of Containers of Rio Grande (Rio Grande do Sul State).
With the success of operations and the approval of ALLs clients such as Sadia, Seara, Perdigo, the partnership was extended to the Frozen
Products Channel of Paran. The Channel, through which refrigerated products are transported from Standards Terminal to TCP Paranagu
Container Terminal (Paran State), made the transportation of refrigerated products to the Port of Paranagu feasible. This years first quarter
posted a 33.78% increase in volume of exports of frozen products thanks to the implementation of the Exporting Channel infrastructure.
Currently, ALL transports containers to the Ports of Paranagu, So Francisco, Rio Grande and Santos, with the beginning of operations in
the new terminal of Alto Taquari (Mato Grosso State), also in partnership with Standard.
ALL RELEASES 4Q08 AND 2008 RESULTS
Curitiba, Brazil, March 11, 2009 Amrica Latina Logstica S.A. ALL (Bovespa: ALLL11), Latin Americas largest independent logistics
company, announces its results for the fourth quarter and full year 2008 (4Q08 and 2008). ALL operates 21,300 km of rail tracks, 1,060
locomotives, 31,000 rail cars, 1,000 highway vehicles, distribution centers and warehousing installations. ALLs rail network serves an area that
accounts for approximately 75% of Mercosurs GDP. The Company serves seven of the most active ports in Brazil and Argentina through
which approximately 78% of all South Americas grain exports are shipped annually. We offer a full range of logistics services, including
domestic and international rail transportation, intermodal door-to-door transportation, distribution and warehousing. The services are provided
in Brazil and Argentina by three business units: agricultural commodities, industrial products and highway services. Comparisons included in this
report, unless otherwise stated, refer to the same period of 2007. Financial and operational information, unless otherwise stated, are presented in
nominal Reais pursuant to Brazilian Corporate Law. Results for 2007 and 2008, unless otherwise stated, contemplate the changes in Brazilian
Accounting Standards occurred in 2008 (Law 11,638) and may differ from numbers previously released. Consolidated results, unless otherwise
stated, excludes the results of Santa F Vages (40% owned by ALL).
OPERATING AND FINANCIAL HIGHLIGHTS
Consolidated EBITDA increased 23.9% in 2008 to R$1,080.7 million and EBITDAR increased 17.6% in the period, to R$1,248.8 million.
EBITDA grew 25.5% in agricultural commodities, 19.0% in industrial products, 34.6% in highway services and 29.4% in Argentina. EBITDA
margin increased from 40.7% to 43.2% in 2008. In 4Q08, consolidated EBITDA increased 17.8%, from R$188.8 million in 4Q07 to R$222.4
million and EBITDAR increased 14.1%, from R$232.7 million in 4Q07 to R$265.6 million.
Strong 4Q08 pushes consolidated volumes to a 10.8% growth in 2008, reaching 38,204 million RTK. In Brazil, full-year volumes increased
11.7%, with an increase of 11.2% in agricultural commodities and 12.7% in industrial products. In 4Q08, volumes increased 16.2%, from 8,688
million RTK in 4Q07 to 10,100 million RTK, mainly driven by favorable grain market, industrial market share gain and another strong
performance in Argentina.
Average yield increased 6.0% and consolidated revenues increased 17.0% in 2008, reaching R$2,822.4 million. The yield increase mainly
reflects: (i) higher tariffs on negotiated agreements, (ii) pass-through of diesel price increase and (iii) lower fertilizer volumes. In 4Q08, revenues
increased 22.7%, and average yield rose 7.8% due to take-or-pay revenues related to underperformed volumes, a strong increase in yield in ALL
Argentina and a change in transported freight mix. These effects more than offset the weaker freight price in spot market.
For 2009, we reiterate volume guidance with expected growth between 10% and 12%, pushed mainly by productivity gains and market
share increase. We have negotiated with clients 72% of all expected volumes on take-or-pay agreements and expect a marginal increase in yield,
assuming no changes in diesel price in the local market.
We have signed a long-term contract with Rumo, an indirectly controlled company of Cosan, for the transportation of 9 million tons of
sugar per year, from Itirapina, in the interior of So Paulo State to the Port of Santos. Currently, we only haul 2 million tons of sugar in that
same corridor. This contract also contemplates R$1.2 billion of infrastructural investments made by Rumo. The start-up of this operation is
subject to the full compliance of pending conditions provided in the agreement.
ALL releases 4Q07 and 2007 results
Curitiba, Brazil, February 28, 2008 Amrica Latina Logstica S.A. ALL (Bovespa: ALLL11)2, Latin Americas largest independent
logistics company, announces its results for the fourth quarter and year of 2007 (4Q07 and 2007). ALL operates 21,300 km of rail tracks, 1,050
locomotives, 30,000 rail cars, 1,000 highway vehicles, distribution centers and warehousing installations. ALLs rail network serves an area that
accounts for approximately 75% of Mercosurs GDP. The Company serves seven of the most active ports in Brazil and Argentina through
which approximately 78% of all South Americas grain exports are shipped annually. We offer a full range of logistics services, including
domestic and international rail transportation, intermodal door-to-door transportation, distribution services and warehousing. The services are
provided in Brazil and Argentina by three business units: agricultural commodities, industrial products and highway services. Comparisons
included in this report, unless otherwise stated, refer to the same period of 2006. Financial and operational information, unless otherwise stated,
are presented in nominal Reais pursuant to Brazilian Corporate Law. Consolidated results, unless otherwise stated, excludes the results of Santa
F Vages (40% owned by ALL). Numbers for 2006, unless otherwise stated, are presented in a pro-forma basis combining ALL, Brasil
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Ferrovias and Novoeste Brasil as if the acquisition of Brasil Ferrovias and Novoeste Brasil - that was completed in May of 2006 - were already in
effect in January 1st, 2006.
OPERATING AND FINANCIAL HIGHLIGHTS
Consolidated volumes increased 10.1% in 2007, reaching 34.486 million RTK in 2007. As expected, consolidated volume was pushed up by
a 19.4% increase in 4Q07, reflecting significant gains in safety and asset productivity in the northern network. In Brazil, volume increased 11.8%
in 2007 and 22.5% in 4Q07, due to a 27.0% growth in agricultural commodities and 13.4% growth in industrial products flows. In Argentina,
volume increased a modest 3.6% in 4Q07 and did not grow in 2007, adversely affected by the impact of the energy consumption restrictions on
rolling stock productivity.
Consolidated EBITDAR increased 27.2% to R$1,062.0 million in 2007. Consolidated EBITDAR margin increased 8.7 percentage points
to 50.3%. Year-over-year EBITDAR and EBITDAR margin growth were mainly driven by higher volumes, significant increase in return cargo
and cost reductions in Brazil, partially offset by margins reductions in ALL Argentina. EBITDAR increased 29.9% in agricultural commodities,
34.9% in industrial products, 52.1% in highway services and decreased 36.9% in Argentina. In 4Q07, consolidated EBITDAR increased 11.7%,
from R$208.3 million in 4Q06 to R$232.7 million.
Net income reached R$216.8 million in 2007 as compared to a loss of R$134.8 million in 2006. Net income expansion reflects the strong
operational performance of the 2H07 and a R$91.5 million one-time gain due to abolition of interest expenses on SUDAM (Superintendence for
the Development of the Amazon) financing that occurred in September 2007. In 4Q07, consolidated net income reached R$19.5 million
compared to a net loss of R$34.5 million in 4Q06.
For 2008 we have already signed with clients 70% of expected volumes on take-or-pay agreements. This leaves 30% of our capacity to be
sold in the spot market. First estimates for the 2008 crop indicate a positive scenario. The amount of planted area for this year increased roughly
4% for soybean and corn and 8% for sugar cane compared to 2007. In preparation for that, we are currently refurbishing 50 locomotives and
1,200 railcars from dead fleet and our clients have added 250 new tank cars.
All America Latina Logistica S.A. to Invest $112 Million
All America Latina Logistica S.A. will invest BRL 200 million ($112 million) this year in repairs and construction of new rail lines in Brazil.
The value represents about one-third of the total resources to be invested by the company this year. The greater part of the investments will go
to improve the railway network from Mato Grosso to the Port of Santos, a stretch of the old Brasil Ferrovias railroad, which has 4,700
kilometers of right-of-way.
All America Latina Logistica and Katoen Natie Signs Deal to Turn the Paulnia Terminal into the Biggest Logistic Centers in So Paulo State
[BusinessWeek, December 7, 2007]
All America Latina Logistica S.A. and Katoen Natie have signed a deal to turn the Paulnia terminal into one of the biggest logistic centers in
So Paulo state. The new terminal will have a handling capacity of 110 containers/day and will enable a more efficient integration between the
Multimodal Distribution Center and the railway transport network. ALL will invest over BRL 6 million in the overhauling of 120 freight cars
and six steam engines, while Katoen Natie will increase the railway network by 700 meters and create a maneuver yard able to hold 65 freight
cars at once.
ALL AND MASISA INVEST R$3.5 MILLION IN NEW WAGON MODELS
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The identification of opportunities for the development of similar new projects is part of ALLs strategy for the next years, predicting a
gradual increase in the volume of industrialized goods and an increasing participation of the client in the necessary investments to expand
capacity
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602-586-4861
COMPANY BACKGROUND
Parent Corporation:
NOL Group
Asset Focus:
VASCOR, Ltd.
OVERALL CAPABILITY
Overall Capability of Provider:
Tier 1 global supply chain manager and freight forwarder with VAWD capabilities.
KEY PERSONNEL
Jim McAdam
President
Ted Fordney
Rajiv Saxena, PhD.
976
976 **
Exchange:
4,500
750
3-5
SGX
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
78
Total Trucks:
Total Trucks:
Total Other:
19
Total Trailers:
Total Aircraft:
2
227
Total Ocean:
5
15
Total Other:
8
1
26.1
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Oracle--OTM, i2, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
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EDI Handling
ERP Interfaces
Page 64 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3M
Miscellaneous
N. America, L. America
AAFES
Military, Government
Global
ACE Hardware
Specialty Retailers
N. America
N. America
ArvinMeritor
Global
Asics
Asia, Americas
N. America
Avon
N. America
Baxter International
N. America
N. America
N. America
US, Asia
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 65 of 625
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Egypt
Israel
Brunei
Fiji
Belgium
Mexico
Cambodia
New Zealand
Denmark
United States
China
Saipan
Finland
Argentina
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Nicaragua
Panama
Peru
Uruguay
Jordan
Kenya
Australia/New Zealand
APL
Bahrain
Africa/Middle East
Asia/Pacific
France
India
Madagascar
Mauritius
Morocco
Indonesia
Oman
Malaysia
Saudi Arabia
Myanmar
South Africa
United Arab Emirates
Pakistan
Germany
Hungary
Japan
Netherlands
Norway
Poland
Portugal
Philippines
Spain
Singapore
Sweden
South Korea
Switzerland
Sri Lanka
Turkey
Taiwan
United Kingdom
Thailand
Vietnam
EDITOR'S COMMENTS
APL Logistics' strengths have been in the automotive/industrial and retail client verticals. Thirty-two percent of
revenues are in the automotive/industrial segment, 29% retail, 21% consumer goods, 4% electronics/high-tech and
14% other. The Americas generates 65% of revenues, Asia/Middle East 25% and Europe 10%. APL Logistics has
automotive joint ventures in China.
Two-thirds of APL Logistics revenues are from contract logistics; one-third from freight forwarding. Its global
warehousing network consists of 65 facilities (16.2 MSF) in North America, 78 facilities (8.7 MSF) in EMEA, and 23
facilities (1.2 MSF) in Latin America. Its forwarding operations are closely linked to its parent company's ocean
container operations. APL provides customers more transparency than other Asia-based logistics companies.
APL Logistics handles about 35,000 shipments in its intermodal division. Top intermodal customers include:
3M, Ace Hardware, Baxter, Bay Valley Foods, Del Monte, Hino Diesel Trucks (U.S.A.), Ikea, Wal-Mart, and Winn
Dixie.
Provider's Strengths
Each part of APL Logistics is a major player in its 3PL segment. APL has strong Asia Pacific bases.
Provider's Weaknesses
U.S. warehousing growth seems to have stagnated.
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Corporation, Hanes Brands, Birds Eye Foods, Tyco Fire and Security, and Yamaha Motor Corporation, USA.
To support operations, APL Logistics primarily uses Manhattan Associates "PkMS", HK Systems "Irista", and its proprietary "WMSp"
warehouse management systems. Each system has been integrated with its transportation management system ("Nulogx"), yard management
system (YMS), visibility tool ("See Change"), and in many cases with client's enterprise resource planning (ERP) systems for full order to delivery
supply chain optimization and visibility. Integration with client's SAP ERP systems is a core competency. Most of its warehousing operations
utilize radio frequency (RF) devices integrated with the warehouse management system(s) for paperless putaway and picking and overall
inventory management.
Tyco Fire and Security (ADT Worldwide)
Since 1998, APL Logistics has been managing Atlanta warehousing operations for Tyco Fire and Security, a division of Tyco International.
The initial project focus was to consolidate the operations of nine distribution points in the Caribbean and North America into one centralized
distribution center (DC) in Atlanta.
The main value-added warehousing services being provided are inventory management, kitting and component assembly, and order
fulfillment. The 296,000 square foot operation has a significant amount of stock keeping units (SKUs) of products and parts and employs 190
people over two shifts.
The operation includes a restricted "clean room" where configuration specialists assemble and test electronic systems prior to distribution.
APL Logistics also provides on-site office space for approximately 40 support staff.
Tyco Fire and Security drops a significant number of orders daily to APL Logistics, most of these orders are completed and shipped the same
day. Many of the orders require kitting of product into specialized packaging for on-site repair technicians.
APL Logistics also provides export packaging and generates Customs required documentation for international shipments. The majority of
outbound orders are small package, with the remainder being tendered to less-than-truckload (LTL) carriers.
A disaster recovery command center has been implemented to assure business continuity.
APL Logistics has built internal training programs and methodologies focusing its workforce on a Six Sigma approach to quality process
improvements. This approach is reflected in many of the reengineered process improvements. Through its quality efforts, APL Logistics is
averaging 99.9% order accuracy for this consumer electronics manufacturer.
Yamaha Motor Corporation, USA - Atlanta Regional DC Operation
Yamaha Motor Corporation, USA (YMC) has been an APL Logistics client for 34 years. In the mid-1980's, it moved distribution operations
from Jacksonville, FL to its current APL Logistics designed 428,000 square foot dedicated Atlanta regional distribution center (RDC). The APL
Logistics RDC operation is one of six YMC distribution centers in the U.S. and distributes over 60% of YMC's annual volumes to a network of
just over 2,000 dealers. APL Logistics industrial engineers utilized i2 and CAPS network modeling software to assist YMC in designing its
domestic distribution network and to reduce overall supply chain costs. APL Logistics also operates Chicago and Dallas RDCs for YMC. The
Atlanta RDC has an approximate staff of 25 and just over 1,000 SKUs of finished goods and parts are maintained in inventory. APL Logistics is
fulfilling over 100,000 orders per year for YMC.
The majority of the Atlanta RDC facility supports YMC in its manufacture of Rhino all terrain vehicles (ATVs) at its plant in Newnan, GA.
Value-added warehousing services provided by APL Logistics include: racking of 200-300 Rhinos per day for transportation, re-labeling parts
and products, packing-out Rhino accessories, inventory management, and cross-docking. To date, APL Logistics is maintaining an average
inventory accuracy of over 99.9%. To increase operational efficiencies, reduce transportation costs, and reduce damages, APL Logistics also
worked with Yamaha Motors in designing non-crated returnable racks for its products.
APL Logistics is also managing the outbound transportation for the Atlanta, Chicago, and Dallas YMC RDC's. The transportation services
provided include: international ocean, domestic intermodal, port and rail container drayage, plant support, truckload, and LTL. The APL
Logistics YMC transportation operations are staffed by one client service representative, two load planners, and five brokers. In Atlanta, APL
Logistics is also running a dedicated fleet of 18 tractors and 50 trailers to support inbound Newnan plant manufacturing and outbound plant to
RDC loads. APL Logistics has been able to provide YMC with consistent on-time delivery service of over 98% for all of its transportation.
Other APL Logistics Atlanta Campus Operations
In addition to the above client examples, APL Logistics is running a 346,000 square foot multi-client warehouse. Next to the multi-client
warehouse, APL Logistics also runs a 341,000 square foot warehousing operation for a large consumer package goods manufacturer.
Summary
With the support and commitment of its revitalized upper management team, APL Logistics is leveraging its international network scope and
the capabilities demonstrated in its global warehousing and transportation operations in developing new 3PL business. Through its ongoing
emphasis on training and Six Sigma and Lean process improvements; we anticipate APL Logistics will become an increasingly visible industry
leader.
APLs Deconsolidation Facility
Torrance, CA Site Visit
October 4, 2002
Key Personnel:
Marold Kamai, Managing Director Deconsolidation Services
Robin Yutuc, General Manager Torrance Facility
Design and planning are heavily involved in this facility. Its less than one year old and its backbone is information technology. Two
programs make up the IT spine. First is APL Logistics Container Management System (CMS), now in its third revision. Marold Kamai is the
man behind this system. He was trained in computer science, worked in operations and is now a managing director of deconsolidation services.
The CMS he built allows for several days of lead time visibility to inbound containers and optimizes outbound 53 foot trailer space. Kamai is
able to get an average of 1.7 FEUs on each trailer by crossdocking and reloading. In addition, significant savings are made with regard to the
carriers container detention and repositioning charges allowing a cost savings to the deconsolidation customer. CMS is also used to consolidate
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export shipments.
The second key piece of IT is Manhattans PkMS. This Internet enabled WMS and inventory control system is used to merge individual
cartons for crossdocking and outbound shipment to U.S. locations.
CMS end-to-end matches containers to trailers by purchase order, part number, style or destination. PkMS allows for a more granular
treatment of LTL shipment reformulation.
To smooth the flow into the facility, dispatches are divided up into six hour segments. Drivers going to the ports of Los Angeles and Long
Beach are communicated with by radio and cell phone to keep them moving as efficiently as possible.
The facility is 265,000 square feet with 64 dock doors. It is 120 yards wide. There are 92 trailer parking spaces and can be expanded to an
additional 200 offsite. Kamai expects APL will handle about 12,500 FEUs per year through the facility.
Parcel shipments are sorted out individually and tendered on a pup trailer each day to a single carrier.
Major customers are Linen & Things (inbound), Espirit, Asics Tiger and Komodo. Espirit is a vendor receiving GOH service. Its major
customer is Macys West, a Federated Company.
Asics Tiger offers a good example of how the APL deconsolidation facility operates. Asics makes shoes in China. The cartons of shoes are
labeled, barcoded, read and placed in cardboard shipping cartons at the end of the production lines. The cartons are barcoded.
Cartons are tracked from shipping point to the port, then from the port in China to Los Angeles. Because of EDI feeds to CMS, APL has
several days notice for each container. EDI feeds are made to PkMS so that individual cartons can be matched up to retail store requirements.
PkMS groups cartons accordingly into store shipments. These LTL shipments are then optimized by CMS for outbound trailer movement.
About 15% of Asics shoes are accumulated as inventory for future shipments. All cartons are relabeled by APL as part of the reshipment
process.
Kamai is continuing to work on the design of the deconsolidation facility and the power of CMS. He expects APL Logistics to be able to
optimize according to landed costs for some customers within the next year.
APL Logistics chief sees strength through peak season
3PL exec sees imports picking up; says parent company will expand use of 53-foot boxes to boost domestic capacity.
The president of APL Logistics, countering growing concerns over a possible second-half economic slowdown, said order flows from
overseas markets into the United States are strengthening as the year progresses. The 3PL executive added that large U.S. retailers see no slack in
end demand through the October-November period, when traffic normally drops off leading into the holidays.
Separately, Jim McAdam told DC Velocity that shipping giant APL, APL Logistics' parent, is developing a program to utilize 53-foot ocean
containers for intermodal movements in the United States once the containers arrive from Asia and are unloaded at their U.S. ports of entry.
APL said the program would give shippers access to more domestic capacity and provide the company with revenue freight on return trips,
rather than hauling the boxes back empty.
In November 2007, APL took delivery of the industry's first 53-foot seagoing container, enabling shippers and importers to move more
cargo than they had in the 40-foot boxes that had historically been used for ocean voyages from Asia to the United States.
McAdam said
APL Logistics is seeing a 25-percent increase in import volumes from major U.S. retailers compared to 2009 levels. "What our customers are
telling us is they don't see much of a slowdown" heading into the holiday period, McAdam said.
If anything, the surge in demand is putting pressure on APL Logistics to secure adequate ocean liner capacity for customers, according to
McAdam. "Capacity is tight for everyone, and in every market," said McAdam, whose company uses ocean carriage to move most of its
customers' freight. APL Logistics relies on its parent for about half of its ocean capacity needs.
"The discourse has changed" from 2009, McAdam said in an interview from the company's Singapore headquarters. "Last year, it was all
about cost reductions. Now, it's about finding more space, more capacity." McAdam said APL Logistics' own capacity needs are most acute for
its services that promise day-definite deliveries for shipments from Asia to North America through sea-land partnerships with truckers.
The service for less-than-containerload (LCL) freight, performed in conjunction with Con-way Inc. and which serves the United States,
Canada, and Mexico, has seen a doubling in demand over the past year, McAdam said. Demand for the full-containerload-service, which was
launched subsequent to the LCL service and which today just serves the United States with various trucking partners, has grown fivefold year
over year, McAdam said.
"We can't put enough capacity" in the markets where the company operates the services, McAdam said.
About 60 percent of APL Logistics' revenue comes from North America, McAdam said. For the first quarter, revenue hit $296 million, a 23percent increase over the same period in 2009.
APL Logistics, Sumitomo Warehouse Co., form alliance
July 1, 2010: APL Logistics has announced a strategic alliance with Japans Sumitomo Warehouse Co. to jointly market global supply chain
services.
Under the agreement, Osaka-based Sumitomo will offer its warehousing and other logistics capabilities in Japan to APL Logistics customers.
APL Logistics, part of Singapores NOL Group, will make its global services available to Sumitomo customers. The alliance partners said theyll
jointly market services and offer preferential rates to clients.
Were delighted with this alliance because it dramatically strengthens the capabilities of both organizations, said Jim McAdam, President of
APL Logistics. Whats more, it permits us to support each other through business leads and joint sales efforts with a broad international client
base.
The alliance brings together two top names in supply chain management. APL Logistics provides origin, destination and transport services
to multinational clients in major world markets. Century-old Sumitomo provides a range of supply chain services in Japan emphasizing
integrated distribution.
Heres how the strategic alliance will work:
APL Logistics global network will provide services to Sumitomo customers outside of Japan. The services include purchase order
management, buyers consolidation management, value added services, factory load management, customs brokerage, freight forwarding and
trucking.
Sumitomo will provide APL Logistics customers in Japan with deconsolidation services, warehousing and distribution, transportation
management, value added services and customs brokerage.
Our aim is to optimize our customers total supply chain, said Shoichi Abbe, President of Sumitomo Warehouse Co. Through this
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alliance we can better provide them logistics strategies and efficient logistics services from a global perspective.
APL Joins INTTRA Portal
[By Peter T. Leach, The Journal of Commerce Online, May 19, 2010]
E-commerce gets key player in Asia after investment, expansion in the region
APL will join the INTTRA e-commerce portal, giving the platform important new reach in the ocean shipping world, the companies
announced Tuesday.
Joining INTTRA is essential to meet market demand for proven e-commerce solutions that streamline processes, optimize freight flows and
manage costs, APL President Eng Aik Meng said in the announcement.
The Singapore-based container shipping unit of Neptune Orient Lines said the INTTRA membership complements APLs existing
relationship with GT Nexus. APL was a founding member of that competing portal, whose 40,000 registered users include major shippers.
A full-scale electronic interface between INTTRA and APL is scheduled for completion by the end of 2010.
APL joined the INTTRA network a few months after the e-commerce portal moved its booking services into East Asia with the opening of
a new development center in China, a new office in Japan and expanded its global development and service center in Singapore.
The expansion came after ABS Capital Partners invested $30 million in fresh capital into the company, taking a majority share in a booking
platform started by ocean carriers and setting INTTRA on an expansive new business plan.
The new capital investment enabled INTTRA to expand into East Asia and to expand its global development and service center in Singapore.
INTTRA said volume growth in container orders initiated on its platform across the East Asian region has averaged more than 80 percent in
the past two years.
The INTTRA network consists of electronic links with more than 30 leading ocean carriers and more than 50,000 active network
connections with shippers to streamline and standardize processes such as bookings, bills of lading and invoicing. Each week 315,000 container
orders are initiated over the INTTRA platform, representing in excess of 10 percent of global liner shipping trade.
The platform still lacks several major members in Asia, including Evergreen Line and OOCL.
APL Logistics is appointed Kimberly-Clark's distribution partner in Indonesia
APL Logistics has been awarded a three-year contract covering the management of transportation and distribution of Kimberly-Clark's
products throughout Indonesia.
APL Logistics will manage transportation from Kimberly-Clark's distribution centre in Jakarta to more than seventy locations in eleven cities
across Indonesia, including retail outlets and the manufacturer's network of distributors for professional services such as hotels and restaurants.
APL Logistics will manage a fleet network that operates exclusively for Kimberly-Clark, planning the most efficient routes for faster delivery
times, maximizing truck capacity and reducing emissions from transport operations.
An APL Logistics team will be based at Kimberly-Clark's facility in Jakarta to ensure that coordination between the cargo handling and
storage operations is integrated with APL Logistics' transportation services, ensuring effective product movement throughout the supply chain.
The team will also handle door-to-door documentation management, which spans initial forecasting through to obtaining and recording
proof of delivery/return.
APL Logistics also manages transportation and distribution services for Kimberly-Clark in Costa Rica.
APL Logistics Integrates and Expands CFS Capabilities in Pakistan
Extended range of origin services to be coordinated from one dedicated CFS facility at Port Qasim
Karachi, Pakistan - 29 Mar 2010: APL Logistics, an innovative provider of international supply chain solutions, has commenced operations at
a new custom-built container freight station (CFS) facility at Port Qasim, Karachi. The strategic move has consolidated CFS capabilities from
across three locations into one dedicated centre; to deliver cost savings and increase transit time efficiency for customers by being close to one
of the busiest ports in Pakistan.
Controlled exclusively by APL Logistics, the state-of-the-art centre, which utilizes a capacity of 35,000 square feet and can be expanded to up
to 60,000 square feet in line with business demands, will provide APL Logistics with a platform to increase the speed and scope of its services to
customers across Pakistan.
APL Logistics is the first logistics provider in Pakistan to offer container yard storage and handling capabilities. Also, by establishing a singlepoint of co-ordination, the business has strengthened its trucking, customs brokerage and freight management capabilities, which increase the
efficiency and flexibility of vendors cargo management. The developments enhance the services currently delivered in Pakistan, which include
cargo consolidation, warehousing, documentation, quality-control and value-added services.
As the facility is adjacent to Port Qasim and conveniently linked by road to the Port of Karachi, APL Logistics CFS operations are
positioned close to ports that serve around 90% of Pakistans import/export cargo. With nearby access to major road, waterways and rail
networks connecting the hinterlands, customers are able to minimize transportation time and costs.
Joseph Lee, Managing Director, APL Logistics Middle East said: Modern, integrated logistics services and infrastructure are fundamental to
Pakistans growth as a manufacturer and consumer. APL Logistics is committed to supporting this development to help our customers tap both
domestic and international market opportunities. The consolidation of our capabilities into a new scalable facility allows APL Logistics to
provide customers with a broader and more efficient range of inventory management services that optimize product-flow and cost-effectiveness.
Irfan Sheik, Head of International Logistics Services, Pakistan, APL Logistics, continues: Our location by the Port of Qasim offers
customers a strategic advantage by leveraging our road transportation operations for reliable domestic distribution or seamlessly connecting to
global markets via our ocean transportation services. Furthermore, our proximity to Karachis key industrial zones, such as the upcoming Textile
City, ideally positions APL Logistics to support the regions progressive trading initiatives.
The facility benefits from the latest modifications, such as dock-high flooring for faster container movement, advanced security systems and
intelligent IT systems to increase inventory visibility and control. In addition to customized warehouse space, on-site accommodation will be
provided for employees to ensure 24/7 operational continuity. An administration office will also be based at the centre.
Since 1991, APL Logistics has helped customers to maximize the efficiency of their supply chains throughout Pakistan. The business delivers
a range of origin logistics and supply chain services from across Pakistan and has the flexibility to integrate these into its worldwide transport
and logistics network.
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91-22-2835 3876
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1989
Asset Focus:
Market Area:
Founding Business:
International
Customs House Agent
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Rajesh Uchil
Chairman
Harish Uchil
Ram Mantravadi
CFO
VP Process & IT Mgmt.
Ticker Symbol
43
9 **
194
35
3
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.3
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Healthcare
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Page 70 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ABB
Industrial Machinery
India
Actavis Pharmaceuticals
Pharmaceuticals
India
Avocent
US
Cipla Ltd.
Pharmaceuticals
India
Dade Behring
Europe
Packaging, Containers
India
HCL Group
India
Honda Motor
India
ITC Hotels
India
Engineering, Construction
India
Moser Baer
Computer Peripherals
India
Pharmaceuticals
India
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 71 of 625
Asia/Pacific
Europe
North America
Aqua
Latin/South America
India
EDITOR'S COMMENTS
Aqua Logistics has network of 8 offices throughout India and agent relationships in North America and Europe.
Aqua's areas of expertise are in freight forwarding and project logistics along with other value-added services
provided by its subsidiaries. Uchil has put together a good staff for continued expansion.
Provider's Strengths
Aqua has extensive consulting, technology, and backroom operations. Aqua's depth of knowledge about India
allows it to provide customized solutions to unique customer issues.
Provider's Weaknesses
Page 72 of 625
Shipments included heavy construction material such as excavators, loaders, cranes and dumpers along with other supply materials such as
tiles, bathroom furnishings, electrical fittings etc. The scope of work included reverse logistics of equipment to the origin destination.
Our Solution
Aqua Logistics had a key account team to define, plan, implement and control the end-to-end logistics for the entire project. Aqua Enablecustomized logistics order management system (LOMS) was provided for the customer to monitor the entire flow of goods from pick-up to
consumption site in Guyana.
The main activity of LOMS was to provide visibility not only through flow of goods but also over the entire documentation process with
predefined alerts and discrepancy notifications. LOMS also supported the reverse logistics of goods to origin. Aqua Enablement Centre
managed and updated the LOMS for customer.
Benefits
Aqua Logistics customized LOMS gave customer complete end-to-end visibility over sourcing of goods from varied geographic locations. It
also provided a single window communication and control over their supply chain along with physical logistics and reverse logistics services.
Aqua Logistics shares rise after market debut
MUMBAI - Shares of Aqua Logistics <AQUA.BO> <AQUA.NS>, a third party logistics provider, listed at 219.40 rupees on the BSE on
Tuesday, a narrow discount to its issue price of 220 rupees a share, but rose as much as 6.5 percent in early trade.
The firm's shares listed at 225 rupees on the NSE.
The firm is raising about 1.5 billion rupees through the issue 6.87 million shares.
Saffron Capital Advisors and Centrum Capital were the managers to the issue.
At 9:02 a.m. shares were trading at 230.5 rupees after hitting a high of 234.4 rupees on the BSE in a weak Mumbai market.
Aqua Logistics plans expansion, IPO soon
Kolkata, Jan 23: Logistics and supply chain company Aqua Logistics Limited (ALL) plans to acquire majority stake in 3PL (third party
logistics service provider) companies in South East Asia as part of its business expansion plans, a company official said here Saturday.
The company wants to establish four more offices in the country and an office in Dubai to explore business opportunities in the region,
company vice president M.S. Sayad said at a press conference.
"Dubai serves as an important trade link to Europe and an office there will help the company's business expansion in the entire region,"
Sayad also said the company would enter the capital market with its Initial Public Offering (IPO) of Rs.150 crore. The issue would open Jan
25 and close Jan 28.
GST will revolutionize India's logistics sector
Introducing national tax will have same impact as opening borders across Europe
The introduction of a national sales tax in India next year could have a similar impact on freight demand as the creation of the European
single market and customs union, according to leading logistics operators.
Legislators are examining different tariff models for a new country-wide goods and services tax (GST), scheduled to be introduced on 1 April.
"The magnitude of this cant be understated," said Onno Boots, MD for TNT Asia.
"It will be a significant turning point for the logistics market in India. Demand will sky-rocket and the costs to enter the market for foreign
companies will fall significantly, as the footprint needed will shrink.
"The need for time- and day-definite secure services will explode, and that will drive the maturing of the India market and the consolidation
of the logistics sector."
The current tangled web of national, state and local taxes discourages the development of national distribution systems in India and operators
say a GST would enable shippers to implement more modern warehousing and supply chain solutions, helping drive domestic and international
trade.
Vijay Kelkar, chairman of Indias Finance Commission, said an effective GST would push up the countrys growth rate by an additional 22.5% and drive exports 10-14%, by eliminating barriers to trade.
Oscar de Bok, South Asia & Indo-China senior VP for DHL Supply Chain, said the GST would enable shippers to migrate from inefficient
systems using more than 30 stock points.
By operating from just four or five distribution centers covering the whole country, tremendous savings would be generated if intermodal
infrastructure was also built up, he said.
"This is the same as opening up the borders in Europe," he told IFW. "You could reduce stock levels drastically and optimize management.
"Foreign companies entering the market will only need four national warehouses instead of 30 to cover the whole country.
"Quality will rise, there will be less damages and other costs - the supply chain management business will be simpler."
Currently, a central sales tax (CST) is levied on the inter-state sale transactions of goods.
As a result, it usually makes financial sense to maintain separate inventories in each Indian state to avoid inter-state taxes, despite the extra
costs this loads onto supply chains.
The widespread use of tax concessions further skews the market.
TNTs Boots said: "The development of supply chains is currently driven more by tax savings than by logistics efficiency, driving up
transport and warehousing costs.
"With the abolition of CST, trade boundaries between states will not exist and companies can consolidate supply chains.
"This could really see hub-and-spoke strategies take off, focused on central locations such as Nagpur."
The ruling United Progressive Alliance has pledged to have the new system in place by 1 April, although with no IT backbone yet in place or
final tariff system agreed, that could slide.
"It will happen, were just waiting for a final deadline," said De Bok.
India dedicated to rail
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Construction of cargo-only freight rail lines to begin in India, but meanwhile its slow going on the rails.
In the booming Delhi suburb of Gurgaon, new hotels sprout up seemingly every week.
The thing is, they don't seem to come fast enough to keep pace with all the business visitors flooding into the upstart city.
Among those many visitors are executives from Japan taking part in the building boom throughout India, whether its highways, railroads,
airports and buildings. And nowhere will those executives make a larger impact on India's supply chain than through their participation in the
construction of thousands of miles of rail track linking the country's four major cities and its two biggest ports.
Japanese lenders, in particular, are playing a major role in the funding of the corridors, the first of which is due to open in 2012. And so,
when those Japanese executives come to Gurgaon and talk turkey with government officials in Delhi, they get a sense of the barriers facing
India. They get a sense of what makes Gurgaon's hotel situation a sort of microcosm of India's railroad development: Building for the future,
but caught short in the present.
Today, India's railroads are running well over design capacity. That's a function of passenger and cargo traffic growing voluminously over the
past five years while little track has been added during the same period. Plans are in place to change that, with dedicated rail freight corridors on
the agenda and scheduled to come into operation by 2012.
But for the rime being, the rails are moving thick like molasses.
"The Indian Railways is super saturated in that capacity utilization is more than 100 percent," said P.N. Shukla, director of operations and
business development for the Dedicated Freight Corridor Corp., the government organization overseeing construction of the dedicated rail lines
for container and other cargo trains. "And the utilization on the eastern and western routes is 140 percent. It's getting more and more difficult to
satisfy demand for freight and passenger services."
Speaking at the Transport India conference in Delhi in May, Shukla said a number of factors have conspired against the government-run
railways being able to keep up, most notably its age.
"The system was laid 160 years ago, so it's difficult to renovate," Shukla said. "The average speed of freight trains is 20 to 24 kilometers per
hour. It's not possible to guarantee transit times or provide reliability. Yet rail container volume is growing 16 percent annually."
To give a broader sense of India's infrastructure needs, the Asian Development Bank said India requires $800 billion in investment, while
India's government pegs the number at $500 billion. That includes roads, ports, airports and rail, but the lifeblood of India has always been its
rail network.
And, some would say, the Indian Railways is finally taking notice. Its planned investment in the next five years is greater than the total of all
investment in the past 50 years. Nowhere is this investment more noticeable than in the dedicated freight rail corridors being built to link
Mumbai, Delhi, Kolkata and Chennai.
First Phase The corridor plan will initially see lines connecting Delhi with Mumbai and Delhi with Kolkata.
"Phase one will link a region that covers 40 percent of India's population and 50 percent of its GDP," said Abhaya Agarwal, vice president of
ILFS Infrastructure Development Corp., a company that works closely with the Indian government to develop infrastructure projects
throughout the country.
ILFS is in charge of a 300 kilometer-wide swathe of land the so-called Delhi-Mumbai Industrial Corridor on either side of the rail
corridor that is envisioned as one long cargo conveyor belt. The area is roughly the same size as England or Japan.
"We hope to quadruple exports in the next five years," Agarwal said.
The Delhi-Mumbai Industrial Corridor passes through six states. Twelve specific nodes, five of which are to be developed as multimodal
logistics hubs, are planned between the nation's capital and its largest seaport.
"The corridor would be supported by a network of 7,000 kilometers of feeder road links and 3,000 kilometers of rail feeder lines from
industrial areas," Agarwal said. "The idea is to connect to the corridor at these 12 nodes."
Shukla, of the Dedicated Freight Corridor Corp., said the benefits of the dedicated corridors, will be blatantly obvious.
Transit time between Delhi and Mumbai "will be cut in half, from 48 hours to 24," he said. "There will be guaranteed transit. There will be
special wagons for handling freight that has been phased out on the normal railways."
But he also cautioned that there is more to do than simply lay the track.
"It's a huge land acquisition process," he said. "About 40 percent is already owned by the Indian Railways, but 60 percent still needs to be
acquired."
Work is slated to begin in August or September on the land already owned by the railways.
The freight corridors, which will cost $30 billion to $40 billion, will be financed one-third through equity from the Indian Railways' reserves
and two-thirds by debt. The outside funding will come from the World Bank, the Asian Development Bank and Japanese infrastructure funds.
Those lending agents were chosen because they had the most competitive interest rates, a huge factor since the railways is intent on keeping the
prices it charges to shippers as low as possible.
"A big goal is to make freight rates more market competitive," Shukla said.
An Unwieldy Entity While many see the corridors as long overdue, in terms of focus on India's rail cargo, Indian Railways said it has been
difficult to juggle the realities of growing cargo volumes while maintaining critical passenger services. And, of course, it all has to be done at a
reasonable price for the famously cost-conscious Indian citizenry.
There are 63,000 kilometers in the Indian Railways network and 795 million tons of cargo were handled in the last fiscal year, traveling 500
million net ton kilometers.
Weve seen 10.4 percent (compound annual growth rate) in the freight sector, said Satya Kumar, a general manager for the Indian Railways.
Those increases let to a 20.3 percent return on capital investment and a $16 billion profit, he said, though some reports in India indicate that
the railways arent nearly as profitable as the government said they are.
Kumar said the government has had to adjust to the changing economic climate in India one where shippers are clamoring for more
efficient and competitively priced services.
Dynamic pricing has been introduced into the freight and passenger sectors, Kumar said. It was previously unheard of from government,
so asset utilization has gone up tremendously. The question now is, is this growth sustainable? There are 15,000 additional trains needed on
the same network to handle passenger and freight traffic projections for 2020.
There are also technical problems cramping capacity in India. While it used to be that the weight limit was 22.9 tons per wagon, now railcars
can handle 30.2 tons.
But I dont think we can go further than that with our current system, he said. Were hearing 32.5 tons being bandied about for the freight
corridor. But that has to be integrated with the feeder networks because hardly any freight originates or unloads on the corridor itself. It comes
from the feeders. And the interoperability between the current feeder routes and the freight corridor is a problem.
In other words, if the existing lines that link to the freight corridor can only handle 30 tons, the extra weight capacity on the corridor wont
make much difference.
Meanwhile, there are some interesting things happening on those feeder routes. For instance, double-stack trains are already running between
18th Edition
Page 74 of 625
Jaipur, in the state of Rajasthan, near Delhi, and Mundra, a port in the southwestern state of Gujarat.
And the double-stack services already running will eventually be extended to Delhi, said H.D. Gujrati, group managing director, international
marketing for Concor, the state-run rail container operator with more than 90 percent share of the market.
Western Bias Gujrati said that an overload of container traffic in the north and west of the country makes the dedicated corridor an
absolute necessity.
Exim container traffic is not evenly distributed (throughout the country), Gujrati said. Seventy percent moves through the western and
northwestern ports.
He said Indian ports cannot handle the more than 7 million TEUs moving through the country today, much less expected container volume
growth, so the country must increasingly rely on inland container depots (ICDs), even as more than 9 million TEUs of added capacity are
planning for Indian ports over the next four years.
Landside infrastructure should be taken into account when talking about adding port capacity, he said. If you dont have support facilities,
it doesnt matter how much capacity you add.
Concor runs 30 container terminals nationwide, of which 18 are purely for imports and exports, and adds an average of three per year. It runs
45 import/export trains each day, 85 percent of them headed to Jawaharlal Nehru (Mumbai), Pipavav and Mundra (both in Gujarat). And on the
inland side, 75 percent of containers go to container depots in Delhi and its neighboring states Punjab, Haryana and western Uttar Pradesh.
Gujrati said the government is pushing hard to develop mega container depots in India basically inland facilities capable of handling 1
million TEUs or more annually. The first such project, in Dadri near Delhi, is planned to handle 500,000 TEUs by 2010. Its currently handling
180,000.
Concor enjoys a healthy position in terms of container movement by rail, but thats largely because it had a monopoly on such business until
last year. Thats when private operators began running trains on Indian Railways track and using Indian Railways locomotives. Since then,
Concors market share has eroded somewhat.
But that doesnt mean it hasnt been good for the government.
The move to allow private operators has brought the Indian Railways $200 million in revenue from license and haulage fees, plus another $1
billion in commitments for future investment in rolling stock, container depots and logistics parks, said Sankalp Shukla, executive director of
Innovative Logistics, the first private operator to run container trains. Now there are eight, with another eight possessing licenses to do so.
Together, they have 72 trains running, and another 53 due to come online by April 2009. Of the volume running, 60 percent is
import/export traffic and 40 percent domestic. Each train can carry 90 TEUs.
18th Edition
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COMPANY BACKGROUND
Parent Corporation:
Aramex PJSC
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Fadi Ghandour
Lina Shehadeh
Iyad Kamal
Bashar Obeid
Hussein Hachem
CFO
CEO Middle East & Africa
238
90 **
3,650
Exchange:
DFM
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--OPTILOG
18th Edition
EDI Handling
ERP Interfaces
Page 76 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
IKEA
Specialty Retailers
Middle East
Mexx
Apparel
Middle East
Vodafone Qatar
Telecommunications
Middle East
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 77 of 625
Europe
North America
Bahrain
Azerbaijan
Australia
Bulgaria
Canada
Cyprus
Egypt
Bangledesh
New Zealand
Czech Republic
United States
Africa/Middle East
Eritrea
Ethiopia
Asia/Pacific
Cambodia
France
China
Germany
Iran
Iraq
Hong Kong
Jordan
Indonesia
Kuwait
Japan
Lebanon
Libya
Maldives
Ireland
Liechtenstein
India
Malta
Monaco
Netherlands
Slovakia
Nepal
Switzerland
Mauritius
Singapore
Turkey
Morocco
Sri Lanka
United Kingdom
Oman
Qatar
Vietnam
Madagascar
Latin/South America
Greece
Georgia
Ghana
Aramex
Saudi Arabia
Sudan
Syria
United Arab Emirates
Yemen
EDITOR'S COMMENTS
Aramex was founded as a pure express service provider in 1982. In 1987, its freight forwarding business was
launched.
Its Freight Forwarding and Logistics (contract logistics) divisions generated 45% of total revenue of $529 million
in 2009. Its other divisions include domestic and international parcel shipping, magazine and newspaper
distribution, document storage, airline ticketing and travel, and visa services. Seventy-four percent of its revenue is
from the Middle East, 18% is from Europe, 6% Asia and 2% is from North America.
In January 2009, Aramex purchased Metrofile Middle East LLC to expand its document and records
management capabilities.
Provider's Strengths
Freight forwarding and contract logistics in the MENA region.
Provider's Weaknesses
Logistics provider Aramex has launched a twice-weekly haulage service between Scandinavia and the UK and Ireland, calling at major cities
across Finland, Latvia, Lithuania and Estonia en route.
Aramexs UK MD, Jim Armour, said: Our wide experience in the wholesale air express market to the Middle East and the recent growth of
our road freight services to mainland Europe have shown there is a gap in the market to this region and it is a niche which we can fill.
Aramex first quarter profits rise 10%
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Aramex, the Middle East based logistics and transportation solutions provider, has announced its financial results for the three months
ending March 31, 2010.
Net profits for the first quarter of 2010 rose to AED 47.5 million, a 10% increase from AED 43.1 million in the corresponding period in
2009. The company registered a high net profit margin of 9% in the first quarter of 2010, as it continued to implement cost-management
programs, resulting in lower cost of services and capping of expenses.
Revenues also showed strong growth of all key products across the company's operations in the first three months of this year, rising to
AED 530 million, up by 14% from AED 463 million in the same period of 2009.
"Our financial results for the period are in line with our expectations," said Fadi Ghandour, founder and CEO of Aramex, "The growth in
revenues was driven by solid performance in all our markets, and strong double-digit growth of our Freight forwarding business, with a
significant contribution coming from Europe."
"The growth in our freight forwarding business is a clear indicator of the larger trend of global macroeconomic activity," Ghandour added.
The company reported a strong net cash position of AED 500 million as of March 31, 2010, which will support its expansion plans in
emerging markets, particularly Africa, Southeast Asia and the Commonwealth of Independent States, primarily by partnering with strategic local
firms.
Aramex pursues Hong Kong expansion
Delmege, a diversified Sri Lankan business group, in partnership with Aramex, the global logistics and transportation solutions provider, has
announced the formation of a joint venture company, Aramex Delmege Logistics (Pvt) Ltd. The new company combines Aramex's international
transportation network with Delmege's service coverage in the Sri Lankan market.
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Aramex Delmege will offer a range of supply chain solutions, including warehousing and distribution, sea, air and ground transportation,
freight forwarding consolidation and customs brokerage. A special focus of the new company will be services in process analysis, design and
management of supply chain for Sri Lankan clients. The venture will boost Aramex's capabilities in the third party logistics (3PL) segment and
will expand its global portfolio of clients in various industry verticals.
"We are delighted to have found the perfect partner in Delmege to help us strengthen our infrastructure and network in South Asia. The
formation of Aramex Delmege is part of our ongoing commitment to optimize our existing and future supply chain offering within Sri Lanka by
providing comprehensive, cost-effective logistics solutions and management," said Othman Aljeda, CEO - Asia, Aramex.
"As one of the global leaders in logistics and supply chain solutions, Aramex is an ideal complement to Delmege a partnership that will
offer diversified supply chain solutions in Sri Lanka," said Shamil Mendes, Group Director of Delmege Forsyth Group. "Aramex Delmege will
synergize the strengths of both companies to offer our customers operational effectiveness and rationalize their costs."
Aramexs ambition to be the worlds first carbon-neutral logistics company
CAN a logistics company really be carbon-neutral? One company that is trying to be so is Aramex, which in 2006 issued what it claimed was
the first sustainability report in the Middle East and set out a goal to become the first carbon-neutral logistics company in the world.
Among its targets were a 50 percent reduction in emissions per shipment by 2009 and a 20 percent reduction in fuel use. The company also
aimed to have two percent of its revenue from green services by that date.
Has it achieved those targets? Fadi Ghandour, chief executive officer of Aramex, says the company is even now working on an updated
sustainability report that it hopes to issue within a short time. Ahead of that, he declines to give exact figures. But he is absolutely insistent that
being carbon-neutral is a serious long-term goal.
It takes us to the heart of the way we manage our company. We have a stakeholder view of management, he says. We think that we
should conduct ourselves responsibly in the community we live in, and one of the issues is the environment. Being in the transport industry,
which is one of the biggest polluters on earth, it is not an issue we can ignore.
Even to hear a logistics company acknowledge that transport is a big contributor to the problem makes a refreshing change. The airfreight
industry is fond of quoting the statistic that only two percent of carbon emissions are due to aviation, with perhaps 0.6 percent due to freight.
But transport in general, both passenger and freight, accounts for anywhere from 13 to 20 percent of emissions depending on which source
you follow, and according to the Intergovernmental Panel on Climate Change, it has the second fastest growth rate, after power generation. At
current rates, transport emissions will be 80 percent higher by 2030.
So what has Aramex been doing? The companys customer magazine earlier this year talked about planting 10,000 new trees by the end of
June to the south of the Jordanian port of Aqaba, calculating that each tree would compensate for 0.8 tonnes of CO2, or 1,500 km of executive
travel, in its 40-year lifetime. Ghandour says this is just one of several similar schemes it is backing in various countries.
It takes us to the heart of the way we manage our company.
But such initiatives are a drop in the ocean compared with all the emissions made by freight transport. Aramex itself cites a figure that a small
van can produce three tonnes of CO2 emissions per month.
So other initiatives including using hybrid cars wherever possible, upgrading the companys trucks in the Gulf to meet the latest European
CO2 emission standards, and using liquid gas to power vans and trucks. The latter emits 25 percent less CO2 than gasoline and 50 percent of
the companys Egyptian trucks are now powered this way. Aramex is also making sure that all its new warehouses in the Gulf meet ISO 14000
environmental management standards.
One thing that helps Aramex in meeting its environment goals is that, like most logistics companies, it tends not to own its own assets.
Trucks and warehouses are usually leased, and in the case of the former, upgraded every two years in any case. This might seem like passing on
the problem to someone else. But it is only if there is pressure from purchasers that suppliers will upgrade their equipment.
It might be easy to regard all of this as greenwash minor initiatives designed to give the company a good green image. But there are also
sound commercial reasons for the strategy.
Ghandour says that already some customers in Europe will not let a logistics company bid for a contract unless it can produce a sustainability
report, and he says this is starting to influence the Arab world. Global companies operating in Dubai are bringing this requirement with them,
and so some Gulf companies are starting to take note of this issue too.
There is a recruitment and investment angle too. Some of our key employees would be concerned if we were not taking a position on this
issue, and so would some of our investors, he says. It is not an overwhelming trend, but it is a factor.
What about airfreight? One might expect that a company committed to reducing its carbon emissions would automatically be using as little
airfreight as possible. Ghandour says Aramex is in the process of calculating its airfreight emissions on a per kilo basis, but says that offsetting
and buying carbon credits are also ways to reduce its emissions in this area, though the latter should be a last resort.
As it is, the relaxing of Customs barriers between Gulf countries is enabling Aramex to truck a lot of cargo that might once have gone by air.
In doing so, as Ghandour points out, it is also meeting shipper needs, by saving them a lot of cost.
In due course, one might expect Aramex to be trying to source its airfreight from the most carbon-efficient airline, but Ghandour admits
there is not much choice here at the moment. But down the road, we will certainly look at this. This is a long road, and we are still discovering
the issues.
Also in due course, one might expect that companies that can prove their green credentials would win more business from environmentally
concerned manufacturers and shippers. Notwithstanding the loud claims of some western companies to put climate change at the heart of their
planning, it seems that day has not arrived yet either.
I cant say our carbon-neutral policy has led to any new business, but it probably does have an effect on the brand. I would love to be able
to say that being green allows us to differentiate ourselves from the competition, says Ghandour.
Away from the carbon-neutral policy, Aramex has, like other providers worldwide, been suffering in the current downturn. In the first
quarter of 2009, it saw freight revenues fall 20 percent, though it managed a 19 percent rise in net profits nevertheless.
One contributory factor to this was a growth of four percent in international express revenues something one might not expect in a
downturn where customers surely look for the lowest cost options.
Ghandour explains the paradox by pointing to e-commerce, which he says is winning share from cost-conscious consumers because it can
offer lower prices than bricks and mortar retailers. In particular, Aramex offers a Shop and Ship service to Middle Eastern customers that gives
them a US or UK mailbox address, so that they can buy e-commerce products in those countries.
Ghandour says that this business has continued to boom during the downturn, growing 25 percent year-on-year. Online websites like
Amazon have tremendously low prices, and they also enable consumers to compare prices, both of which are powerful advantages in a recession,
he says.
Express is also a higher margin business for Aramex than heavier freight, which accounts for the rise in profits in the first quarter. And there
is the fact that in Saudi Arabia and the Gulf countries consumer spending has held up better than in other parts of the world.
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Even though the recession did come here, we have been able to utilize our massive infrastructure during the time when our competitors
have been looking elsewhere, says Ghandour.
In all, he says 65 percent of Aramexs revenue still comes from the Middle East (that is, not just the Gulf, but Egypt, Jordan, Lebanon and so
on), and the company has a large and growing presence in the domestic express business in many of these countries, unlike its big global rivals.
Elsewhere, Aramex continues to expand, but with more of a focus on developing markets than developed ones. It recently opened a new
wholesale express operation in Germany, which Ghandour reckons is a market that is currently under-served, but its main thrust is towards the
east and south.
A Shanghai operation was opened earlier in the year, and Beijing and Shenzhen are to follow early next year. Ghandour also hints at
imminent expansion in countries such as Malaysia and Vietnam.
The Shanghai opening was unusual in that it is a new operation, Aramex having failed to find a suitable acquisition target or joint venture
partner. But generally it favors the cooperative approach, and has recently approached potential partners in both Central Asia and Africa.
On the latter continent Aramex is particularly interested in the logistics business of the kind it has so successfully developed in countries such
as Egypt, Morocco and Libya. There are at least 10 markets in Africa that are under-served, says Ghandour. Other than DHL, all the big
boys serve the continent through agents. They are not paying attention to it, which is good news for us.
Countries on the list include Ethiopia and Ghana, where Aramex already has local franchisees, as well as Tanzania, Kenya, the Ivory Coast
and South Africa. In Central Asia, Ghandour says the company is looking in all the stans [Afghanistan, Pakistan, etc].
He reckons a downturn is an ideal time to invest. In boom times, you have sand in your eyes, but now this recession has cleared away the
sand and we can see clearly.
He is in no doubt that future growth opportunities are to be found in such developing markets, rather than in the west, something he admits
is a change from a few years ago, when Aramex had an ambition to have a bigger presence in Europe and the US.
In particular, it was a blow for Aramex when DHL bought Airborne Express Aramexs US partner in 2003, but it is a market that
Ghandour is now relieved not to be more involved in. Look at what has happened in the US in the past year. Who wants to touch it? We have
an operation in JFK, and that is enough.
The US is a well-served market and you can always find a partner there. We were worried when Airborne was acquired by DHL that we
would lose business, but then we dug deep into the market and we found so many other operators to choose from.
Today we are doing 10 times the business we used to do with Airborne. And we would rather concentrate our own operations on the areas
of the world where we have the expertise and others dont.
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enquiries@archbold.co.uk
COMPANY BACKGROUND
Parent Corporation:
Archbold Holdings
Asset Focus:
Market Area:
Founding Business:
Europe
Trucking
Shopbox Systems
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Xavier Archbold
Chief Executive
Alan Maher
David Edge
Managing Director
Operations Director
Paul Kennedy
Yannis Archbold
Financial Director
Systems Development Director
54
Ticker Symbol
54 **
Exchange:
250
ASSETS
Total Transportation Assets:
Total Tractors:
250
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
350
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.4
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Page 82 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Allied Glass
Packaging, Containers
Britain
Courtaulds
Textiles
Britain
Diageo
Beverages
Britian
Eastman Kodak
Britain
Ford Motor
Britain
Linpac
Packaging, Containers
Britain
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 83 of 625
Asia/Pacific
Europe
North America
Archbold
Latin/South America
France
Germany
Italy
Spain
United Kingdom
EDITOR'S COMMENTS
Archbold Logistics was established over 80 years ago and today operates as a European logistics, distribution
and warehousing company. The company is headquartered to the southwest of Leeds. Archbold provides clients
with a range of logistics, transport and distribution services, comprising: national logistics services (with 7 UK
operating depots), European distribution services (to Germany, France, Italy, Spain and Eastern Europe),
warehousing, storage and product consolidation, specialized transport services and logistics management
services. In addition, the company specializes in the automotive sector as well as operating a UK and European
express service.
Provider's Strengths
Niche European distribution and logistics with UK base.
Provider's Weaknesses
Scope and geographical reach.
Leading independent logistics provider Archbold Logistics pan-European emergency supply chain solution - Archbold Rapide - has grown
over 30% in a year, for the 3rd year in a row.
This unique transport solution from Archbold Logistics has had a fantastic success rate of on time delivery since its launch. Archbold Rapide
provides night and day coverage for any size of consignment to any destination throughout Continental Europe.
Archbold Rapide is targeted at those ultra urgent and time sensitive emergencies, awkward, high value or hazardous loads that cannot be
performed by other European haulers, or a traditional pallet network.
Archbold Rapide has a dedicated team of experienced professionals based in Yorkshire who manage each consignment as an individual
project. The tailor made solutions can involve, air, sea or road, the organization of police escorts, provision of double manned vehicles, low
loading equipment, hiab vehicles or sliding roof trailers, all permits and customs documentation all organized at extremely short notice.
Recent projects have included getting a number of pallets in a double manned van to Lithuania to prevent production line shutdown and
transporting products with precious metal without the need for a police escort as fast delivery was crucial to the customer. Managing the route
using a two-manned vehicle and tracking and tracing the vehicles every movement to ensure that the load arrived intact and on time.
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49-8442-61-355
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1975
Asset Focus:
Market Area:
Founding Business:
Europe
Auto Transport
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Wilfried Brinkman
President
Frank Lehner
Konrad Lehner
324
Ticker Symbol
324 **
Exchange:
1,010
25
3-5
ASSETS
Total Transportation Assets:
Total Tractors:
490
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
940
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Page 85 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Audi
Europe
BMW
Europe
Daewoo
Europe
Daimler
Europe
e-Sixt
Europe
Europcar
Europe
Fiat
Europe
Ford Motor
Europe
Iveco
Europe
Massey Ferguson
Europe
Mitsubishi Motors
Europe
Nissan Motor
Europe
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
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Asia/Pacific
Europe
North America
ARS Altmann
Latin/South America
Eastern Europe
France
Germany
Spain
EDITOR'S COMMENTS
ARS Altmann is an automobile distributor and exporter from Germany to Europe, Eastern Europe and Turkey.
Emphasis is on finished vehicle distribution and processing.
Provider's Strengths
Its distribution network and strength as a niche provider.
Provider's Weaknesses
Its one industry focus.
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49-5241-80-6006
COMPANY BACKGROUND
Parent Corporation:
Arvato AG
Asset Focus:
Market Area:
Founding Business:
International
Contract Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Eckhard Sdmersen
CEO
Horst Ramsch
Ralf Bierfischer
Media Relations
Managing Director
Ulrich Cordes
Thorsten Thiel
SVP Finance
Managing Director
1,207
Ticker Symbol
1,207 **
Exchange:
9,300
20
3-5
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
9.1
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Healthcare
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Warehouse Management System
18th Edition
SAP R/34
EDI Handling
ERP Interfaces
Page 88 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Audi
Europe
B. Braun Medical
Germany
Beckman Coulter
Europe
Bertelsmann
Entertainment
Germany
Biogen Idec
Pharmaceuticals
Germany
BMW
Europe
Chiron
Pharmaceuticals
Germany
Dell
Germany
Genopharm
Pharmaceuticals
UK, Benelux
Lundbeck
Pharmaceuticals
Microsoft
Computer Software
Singapore
Porsche
Germany
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 89 of 625
Asia/Pacific
North America
Latin/South America
Austria
Canada
India
Belgium
Mexico
Japan
Czech Republic
United States
Argentina
Brazil
Colombia
Malaysia
Estonia
Morocco
China
South Africa
Australia/New Zealand
Arvato
Australia
France
Singapore
Germany
Thailand
Great Britain
Greece
Hungary
Ireland
Italy
Netherlands
Poland
Portugal
Russia
Spain
Sweden
Switzerland
Turkey
EDITOR'S COMMENTS
Arvato Logistics Services is a modern, sophisticated SCM with a fulfillment emphasis in B2B. Its specialty is
advertising material development and distribution.
Provider's Strengths
B2B fulfillment and logistics, communications, supply chain management, finance, reverse logistics and repair.
Provider's Weaknesses
French pharmaceuticals manufacturer Genopharm has selected arvato services healthcare to handle warehousing and distribution of its
product range. From its national distribution centers in the UK and Benelux, arvato services healthcare will deliver Genopharm products to
hospitals across the UK, France, Belgium and Germany within 24 hours a roll-out to further countries across Europe is planned over the next
three years.
The decentralized distribution solution, developed by Genopharm and arvato services healthcare, allows the manufacturer to ship directly to
its customers in a more cost-effective and service-focused manner.
By standardizing IT systems and processes across the board, Genopharm is guaranteed maximum transparency and process efficiency,
allowing the company to significantly reduce order response times and logistics costs.
arvato services healthcare will act as a carrier manager.
"In the past we have satisfied the demand through export activities," says Claude-Alain Cudennec, Head European Business Unit at
Genopharm.
"But in the long run this was ineffective, as we were too far from our customers and markets. Moreover, transport services were requested
separately, which proved very time and cost intensive.
"Ultimately, this is why we chose a decentralized distribution solution and decided to go into partnership with a specialized and experienced
service provider.
The demand for our products is high. We want to continue with our growth strategy in the years to come and that is why we want to be
close to our customers - to do this we needed a flexible partner with access to a scalable, high-performing network here in Europe.
arvato secures exclusive European logistics deal with Lundbeck
Lundbeck further expands international cooperation with arvato services healthcare
Harsewinkel, May 28, 2009 - International pharmaceutical company Lundbeck has appointed arvato services healthcare for the delivery of its
products throughout France and Germany. Supply chain specialist arvato services healthcare already manages the centralized warehousing and
distribution of the entire Lundbeck product range in five other countries, including Austria and Benelux.
Lundbeck previously had a separate logistics system with its own warehouse, local logistics partners agents in every country - and this
structure led to an extremely complex and sometimes inefficient supply chain management system. A European distribution solution, customtailored by arvato healthcare services, was set up in September 2007, providing Lundbeck with a centralized flow of goods, harmonized activities
and a significant reduction in the complexity of its logistics. The pharmaceutical manufacturer has also increased the delivery quality of European
customer orders and increased data transparency.
With the rollout across Germany and France due to start on 1 June 2009, arvato services healthcare will be distributing more than 60 percent
of the total European logistics volume of Lundbeck pharmaceuticals from its central European distribution center in Harsewinkel directly to
wholesalers, hospitals, pharmacies and pharmaceutical experts.
Michael Nerloe Kasebeer, supply chain manager at Lundbeck, said: As a global company, we need partners to support us actively in
achieving our goals at an international level. In arvato services healthcare, we have found such a reliable partner. The results of this partnership
have remained convincing for more than two years and will enable us to stick to our future rollout strategy. The question of when to begin the
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rollout in Germany and France was therefore just a matter of time for us.
CASE STUDY - Beckman Coulter
Kundenzitat
"We wish to thank you for your outstanding performance throughout the year for all territories and particularly for BCISA as well as for your
strong support during the past year." (Dezember 2007)
Jef Herrmann, Manager Warehouse & Distribution EMEAI, Beckman Coulter
Responsibilities
Performing distribution throughout Europe
Handling the return and transport management for reagents, instruments and replacement parts
Customer
Beckman Coulter is one of the worlds leading producers of systems and consumables used in clinical diagnostics and life science. By
automating and simplifying processes, Beckman Coulters products make a significant contribution to increased laboratory productivity.
Currently, more than 200,000 systems are being used in over 130 countries.
A critical point in the companys supply chain was deliveries to hospitals and laboratories. Realizing this, Beckman Coulter turned to arvato
services.
By taking over responsibility for the companys entire distribution, we are successfully contributing to efficient logistics. Smooth-running
processes help Beckman Coulter meet customers requirements and strengthen their loyalty to the company.
Our joint decision to employ a regional distribution center guarantees short delivery times and efficient warehousing. The central distribution
center for replacement parts located near the Brussels airport ensures the time-critical supply of replacement parts and, simultaneously,
optimized inventory consolidation. For this purpose, we selected the appropriate transport concepts, including express delivery (next day, before
9 a.m. or noon) directly to the laboratories or to the home address of a technician or to the trunk of his or her vehicle. In the PUDO (pick-up,
drop-off) concept, the delivery is made in-night. At the start of the job, the technician picks up the shipment at a pick-up point of his or her
choosing.
We also guarantee global export shipments made in compliance with the latest hazardous-goods regulations governing air and sea freight.
The focal point is large volume shipments to distributors in Asia and Africa. The sensitive medical products are subject to precise packaging
regulations for the long journey.
For such solutions, we use both our logistics expertise and a network of European logistics locations that is equipped to meet the special
needs of the in-vitro diagnostics sector.
Central activities
Creating regional distribution centers at arvato services logistics locations in Lognes, France, (8,000 stock-keeping units); Monheim,
Germany, (15,000 SKUs); and High Wycombe, England, (1,000 SKUs) as well as a central European distribution center for replacement parts in
Zaventem, Belgium (10,000 SKUs)
Conducting warehouse and transport management for hazardous goods as well as for thermo-labile products while maintaining necessary
temperature ranges (2-8 C / - 20 C) and complying with legal regulations
Handling returns management of replacement parts and instruments
Carrying out global export shipments
Assuming responsibility for disposal management
Arvato Logistics Services Develops Into Competence Center for Mail Order Transactions
With over 20 million shipments in direct dispatch to end customers, in recent years Arvato Logistics Services has developed into a competent
center for mail order transactions in the media area. All German-speaking regions can now be quickly served from three centrally situated
locations in north and central Germany as well as Switzerland.
Customers such as Weltbild, Bertelsmann Club, Sddeutsche Zeitung and Zweitausendeins rely on the logistics service provider to directly
support and quickly supply their readers. Supplying the trade customers is the responsibility of the Arvato subsidiary Vereinigte
Verlagsauslieferung, which supplies media with high bundling effects on behalf of over 200 publishing companies, book dealers and other sales
points.
Arvato Logistics Services' media mail order business is handled from the three locations: Gtersloh, Neumnster and Pratteln (Switzerland).
Special machines ensure fast and efficient handling. Arvato will shortly expand the daily capacity to 70,000 dispatches. Eight machines
specifically developed for the series business are available, with which over 20 different packaging sizes can be reproduced. Add-on services such
as print on demand productions, customer services in call centers, financial and IT services allow the clients to fully concentrate on their
contextual core business. The direct business often comprises numerous individual add-on services such as, for instance, the gift service with
which cards with individual greetings can be produced and enclosed and the whole thing has to be packaged as a gift and sent on its way with
optimum postage. Special cross-selling methods allow corresponding offers to be enclosed with a dispatch or directly conveyed to the person
placing the order by telephone. For deliveries from Switzerland Arvato Logistics Services also assumes the tax representation for the client,
meaning that all tax and customs matters are handled.
New customers give healthcare logistics an international dimension
Refrigerated storage area in Harsewinkel extended from 220 to 1500 pallet spaces
The refrigerated storage area at Arvato Logistics Services in Harsewinkel has been extended from 220 to 1500 pallet spaces. The healthcare
logistics division, which has been operating as AS Healthcare since its acquisition of the BG Group last year, has had to expand its storage area
in the 2-8 degree Celsius zone and its order picking area as a result of bringing two new customers on board and expanding its business with
Biogen Idec. A particularly positive result of this is the creation of four new jobs in the technical area of healthcare logistics.
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Two new customers, B. Braun and Chiron, were acquired at the end of last year. B. Braun, a long-established company from Melsungen with
some 165 years' experience, supplies medical products, including a wide range for diabetics, to the global healthcare market. Shipping of these
products is now handled by Arvato Logistics Services. Arvato covers all the insulin business for B. Braun, and handles all shipments - which are
of course cooled to between 2 and 8 degrees Celsius - to German wholesalers.
The US-headquartered biopharmaceutical manufacturer Chiron supplies drugs for a special form of kidney cancer and cystic fibrosis.
Chiron's decision to work with Arvato was influenced by the positive experience Biogen Idec had had with the logistics firm. Chiron, which has
been a market player for 20 years, supplies medicines and associated information and advertising material to pharmacies and clinics in Germany
and Austria. A hotline enables orders to be placed directly at Arvato.
Each of the collaborations with B. Braun, Chiron, and Biogen Idec provides the healthcare logistics team, headed by Thorsten Winkelmann
and Christian Wolf, with ample opportunities for international growth. At the beginning of the new year, Biogen Idec commissioned Arvato,
which already ships the drugs for Avonex and Amevive within Germany and the Benelux countries, with the distribution of the medicines in
other countries. Arvato will supply mainly the Middle East with the products Avonex (for multiple sclerosis) and Amevive (for psoriasis). This
entails maintaining the refrigeration chain for transport via both road and air freight.
The expansion of the refrigerated storage area means that the team is well positioned for further growth.
Porsche Design Drivers Selection Now From Arvato
Porsche fans love something special. They expect the highest standards, and not just from the vehicle itself. Sportiness, aesthetics and
functionality have top priority for car and travel products and accessories.
The Zuffenhausen sports car manufacturer has made its name with a wide range of such products. Popular articles with the Porsche label
include clothing, luggage, sunglasses and sports equipment, as well as toys for the smallest fans. The program even includes a miniature
personalized model of a particular car, down to all the fittings in detail. This is the Porsche Design Drivers Selection (PDDS), which has now
been entrusted to the care of the Arvato Logistics Services team. Since February 1, 2006, the entire PDDS product range has been stored in and
distributed from the warehouse in Versmold.
Porsche has been a customer of Arvato Logistics Services since 1989, for the supply of marketing materials to their dealers. 'The new
business merchandising logistics is once again a jewel in the crown of our 17-year business partnership. Over 6,500 items had to be
maintained in the SAP system. Consequently, the implementation of this business has been first and foremost an IT project, in which the entire
IT infrastructure of the Porsche spare-parts logistics has been interfaced to the Arvato Logistics Services' SAP system.
On February 1, 2006, right on time, all the system requirements had been fulfilled so that the distribution could begin. The items, previously
distributed directly from Bietigheim-Bissingen near Ludwigsburg by Porsche Lizenz- und Handelsgesellschaft (PLH), have been stored in a
special high security area of the Versmold warehouse, with separately restricted access. Initially, the business involves supplying the 85 Porsche
centers in Germany and the 160 importers worldwide. The workers responsible for distribution receive orders four times a day. While orders are
processed within one day for inland orders, importers' orders leave the Versmold warehouse within 48 hours. Worldwide distribution to the
dealers will encompass an estimated 22,000 orders in the first year.
'We are delighted to have found in Arvato Logistics Services a flexible service provider who also has many years' experience with Porsche
products', commented Anne Henrici, manager of the Porsche Design Driver's Selection division, at the start of deliveries on February 1, 2006.
'For Arvato Logistics Services, the Porsche Design Drivers Selection business is an essential step in the further development of logistics
services in the automotive branch,' director Ralf Bierfischer and Thorsten Winkelmann, his team's product line manager, are pleased to say.
Just two months after the "ground- breaking" ceremony for the new logistics center in The Czech Republic, our colleagues at Arvato Services
could lay the "Richtkrone" wreath in the topping on 1 June. Amongst representatives from government, management and industry, Thorsten
Thiel, who is responsible for Arvato Services Eastern Europe, and Lubor Lepic, who is the Managing Director in The Czech Republic,
celebrated the official "Topping-Out" ceremony.
The premises are made up of two industrial halls and a wing for offices and management. The total area of the new building is 13,600 sqm.
Upon its completion, planned for August 2005, 300 employees will be working there.
"After looking for the right area for a long time we decided on the site here in Stochov, because of the ideal conditions available for our
logistics and services center. The transport connections are good and its proximity to Pragues international airport played a deciding role,"
explained Thorsten Thiel. Another deciding factor for the setting-up of Arvato Services in Stochov is the excellent cooperation with the state
authorities here. "It took only three months from the time we decided on the site up to the start of construction. This was made possible thanks
to the good and professional teamwork of all those responsible in the city of Stochov". With these words Thorsten Thiel praised everyone
involved in the preparations and setting-up of the whole construction project.
Starting from September, 2005 logistics services like warehousing, picking and packing and transport management for companies in
telecommunications and in the automobile industries, for example, providing of advertising material for all car dealers of a large Czechian car
manufacturer, will be managed in Stochov.
For Lupor Lepic, Managing Director of Arvato Services in The Czech Republic, Stochov is a location with good prospects. "We want to
expand our logistics and services businesses in The Czech Republic with customers from the domestic market as well as with international
customers on a long-term basis," with these words Lepic described his goal for the coming years. The opportunities for such expansion are
there, the grounds of Arvato Services in Stochov have a total of 90,000 sqm, enough space for a further seven similar halls.
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27 11 445 1630
COMPANY BACKGROUND
Parent Corporation:
Barloworld Limited
Asset Focus:
Market Area:
Founding Business:
International
Logistics
Barloworld Equipment
Barloworld Handling
Barloworld Optimus
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Isaac Shongwe
CEO
Jacey de Gidts
Mark Collins
Dir. Finance
Dir. Knowledge & IT
490
490 **
Exchange:
1,943
JSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
Total Trucks:
260
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
Total Trucks:
260
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.1
Total Trailers:
Total Aircraft:
Total Tankers:
Total Other:
MAJOR MARKETS
Food, Groceries
Industrial
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
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EDI Handling
ERP Interfaces
Page 93 of 625
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Illovo Sugar
Food Production
South Africa
MasterFoods
Middle East
Nike
Apparel
South Africa
PPC Cement
South Africa
South Africa
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Page 94 of 625
North America
Angola
Bahrain
Austria
Canada
Burkina Faso
Cyprus
Bangladesh
Belgium
United States
Cambodia
Czech Republic
China
Denmark
Africa/Middle East
Gambia
Mali
Asia/Pacific
Australia/New Zealand
Namibia
Oman
India
Qatar
Japan
Saudi Arabia
Korea
Senegal
Sierra Leone
Malaysia
France
Germany
Indonesia
South Africa
United Arab Emirates
Latin/South America
Finland
Hong Kong
Morocco
Barloworld
Greece
Holland
Hungary
Ireland
Myanmar
Italy
Pakistan
Netherlands
Philippines
Norway
Singapore
Portugal
Sri Lanka
Slovenia
Taiwan
Spain
Thailand
Sweden
Switzerland
Vietnam
Turkey
United Kingdom
EDITOR'S COMMENTS
Barloworld Limited is made up for four business units: Barloworld Automotive, Barloworld Equipment, Barloworld
Handing and Barloworld Logistics. Currently, Barloworld Logistics represents about 10% of its parents revenue.
To expand this business unit and become more globalized, in 2008 Barloworld Logistics acquired Flynt
International Forwarders in Hong Kong, Swift Freight in Dubai and Sea Air Transport (SAT) in Germany. With
these acquisitions, Barloworld estimates it will nearly double its revenues and expand its workforce to 2,500.
Barloworld Logistics revenue increased 27% in 2009 mainly due to these acquisitions. Southern Africa generates
55% of revenue and Europe accounts for the rest.
Provider's Strengths
Domestic distribution.
Provider's Weaknesses
With commercial transport being one of the biggest single sources of carbon emissions in global supply chains, Barloworld Logistics was
inspired to collaborate on a key initiative that brings together lean process thinking with a commitment to innovation and environmental
sustainability - a "green trailer".
The green trailer is an interlink taut liner trailer combination which, through some practical innovation, achieves significant reductions in fuel
consumption.
According to Francois van Rensburg, divisional director of Barloworld Logistics, 80% of businesses that responded to the 2009
supplychainforesight research study indicated that increasing transportation efficiency is seen as a leading initiative to benefit the environment.
"Transport is the biggest area in logistics that affects the environment directly, but is one of the easiest components to address strategically,"
said van Rensburg. "Within the South African context, transport is responsible for approximately 13% (CSIR study) of South Africa's total green
house gas emissions. Our thinking, therefore, was that an innovative approach to the problem would be one that tackles the transport issue head
on."
The green trailer project focuses on sustainability and profitability as two sides of the same coin. Another key aspect of the project was the
way in which industry specialists and service providers collaborate to achieve a worthy goal.
As van Rensburg says: "Many people in the supply chain and transport industries talk about the necessity for collaboration, but this is a case
in point about what can be achieved when experts in the field work towards a common goal."
Many partners were involved in the green trailer project, with primary research conducted by the CSIR, the design by Barloworld Logistics,
and aerodynamic changes to the rig, with structural changes done by Afrit and all the aerodynamic components manufactured by Aerotruck.
Van Rensburg says that all changes made to the green trailer are within the bounds of current legislation. "It was also decided that whatever
changes we made would be backed by research data and that these changes would be practical in normal operating conditions. The focus of the
project was therefore to provide a sustainable road transportation solution for our clients that is both practical and which complies with
legislation."
The research for the green trailer was conducted on the N3 between Johannesburg and Durban. The vehicles on this route do a round trip of
1,160 km on a dedicated route every 24 hours, and 98% of the route is on the N3 and N2. This meant that the vehicles maintained a much more
constant speed compared to vehicles operating on secondary roads or in urban areas. It also meant that the effects of wind resistance were
higher than on any other route.
Initial research in the UK revealed that a fuel saving of 20.4% could be achieved by a curtainsider teardrop rigid trailer travelling at a constant
speed of 80 km/h. A saving of 10.1% could be achieved by a curtainsider semi-trailer was travelling at 63 km/h. The initial simulations based on
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the green trailer research have shown that, once all these changes were made, there was a 35% reduction in the total drag when travelling at a
constant speed between 70 and 80 km/h.
The expected reduction in fuel consumption on the green trailer project for the next six months will be between 6% and 8%.
Barloworld Logistics prepares for European expansion
South African based logistics specialist, Barloworld Logistics, has announced a number of high profile appointments in Europe and the
broadening of its UK Management team, which it says represents the company's commitment to the market and confidence in its' redeveloped
software and new managed services.
In addition, Barloworld Logistics has moved its UK headquarters to larger premises in the West Midlands, from which the company's
logistics and software brands will operate.
In Spain, Javier Siles has been appointed as CEO to head up the Spanish operation, with support from Javier Contijoch, who will take the
lead on sales.
In the UK Richard Forrest, formerly CEO of the Barloworld Optimus business unit expands his role to head of UK Operations,
incorporating both the logistics and software offerings. Richard will be supported by Kevin Boake who leads day-to-day operations for the
software business and Jon Tucker who takes on a solution development role across the combined offering.
John van Wyk, CEO at Barloworld Logistics Europe, anticipates that the recent changes will help to prepare the business for the upcoming
launch of its 'Transport as a Managed Service' platform to the UK and other European markets. He explains, "We believe that for all businesses,
in this globalized economy in which we live, the supply chain is a key enabler of successful business strategy. And this has become even more
important in the present economic climate and as companies plan for the future."
"Our own strategy as a business is aligned with the proposition that we market - to analyze, innovate, and implement change to remain
competitive. I am confident that the appointments in Spain will support a growing need for outsourced services, and the changing roles within
the UK management team will support our ambitions for expansion in the UK and other European markets."
Sea-air has a bright future, insist the new owners of Swift Freight and SAT
WHEN Barloworld bought the Swift Group, owner of the Swift Freight brand, on 1 April 2008, one could have been forgiven for thinking
Barlow-who?
The company has not, to date, had any pedigree in the airfreight business, but it is a famous name in its home country of South Africa. With
the acquisition of the Dubai-based Swift Freight and at the same time sea-air specialists SAT of Germany and Hong Kong forwarder Flynt
International it has now taken a major step into the air cargo arena.
Barloworld's history goes back to 1902 and for a time it was the 49th largest company in the world. That was in the apartheid era when it was
prevented from investing outside
South Africa and so turned instead to owning as much as possible inside it.
Warren Erfmann, chief executive officer of Barloworld Logistics, Middle East and Asia, says the company basically became a brand manager,
and much slimmed down that is what it remains to this day. For example: it is the world's second largest Caterpillar dealer, owns the Avis
franchise in South Africa, plus various car dealerships, and is the world's largest dealer in Hyster forklifts.
Logistics has been a fourth pillar of the business ever since 2001 when the company set out to diversify a trucking business it owned in South
Africa away from asset-intensive work and into supply chain management. "We were a trucking company with a big dream of not owning trucks
in the future," is how Erfmann puts it.
Internationally that led it to logistics operations in Spain and a software business in the UK and US, which provides Network modeling,
forecasting and planning software. Swift, SAT and Flynt took that strategy to a new level, however, and have given the company a global
forwarding and logistics structure.
Swift Freight in particular was attractive because of its strengths in markets such as the Middle East, India and Africa. As Erfmann puts it:
Why should we compete for peanuts on the major trade lines, when there are better opportunities in niche markets?
In particular, along with SAT, Swift Freight gave Barloworld a commanding position in sea-air traffic out of Dubai some three quarters of
the market to Europe, Erfmann reckons. This might seem to be an unhappy choice niche just at present, when rock bottom sea freight and
airfreight rates must surely be eroding demand for this hybrid form of transport, but Erfmann insists that such conditions cannot last.
There has been a knee-jerk reaction from airlines because their planes are empty and want to fill them, but will get wise soon and bring rates
back to a level that makes sense," he says.
Meanwhile, he believes that sea-air remains a highly marketable product, one that many customers are still not aware of. "A lot of customers
simply don't understand what sea-air is and how it can benefit them, he says. "Once they understand, they are attracted to the product. Even
before the downturn started, we had embarked on sales to bring sea-air to the market's attention in away that had not been done before, and
that initiative is starting to bear fruit."
Traditional cargo for sea-air has been garments, but Erfmann says that IT products and white goods also move well by this method.
Forwarders have traditionally been reluctant to use it, he says, because they worried about what might happen during the transfer between air
and sea.
"But now we can offer them a good partner in Dubai that specializes in fast transit between ship and air. We can achieve six to seven hours
from ship to plane, which is quite incredible. When customers see that they can half the transit time and half the cost, it is a very attractive
option."
Connection times between sea and air should get even faster once the Al Makroum International Airport opens next to the Jebel Ali
Freezone in Dubai. Swift Freight was one of the first companies in to sign up for a facility in the adjacent Dubai Logistics City (DLC), and it
also has an air-side facility reserved at the airport itself.
Erfmann confirms that the idea is to control the whole process from port-to-tarmac, which he hopes will drastically speed up connection
times. "Once everything is up and running, it will be 20 to 30 minutes from port-to-airport," he says. "When we control our own destiny with
our own handling, there will be no stopping us."
Having said that, the vision looks set to stay on hold for the immediate future, as plans to open the new airport have recently become fluid.
Erfmann sympathizes with competitors whose facilities in the DLC are already complete but cannot be used. Swift Freight has been more
cautious and has not yet started construction in either location. "We still believe in it all, but it is a matter of timing," he says. "Perhaps in a
downturn, a delay is not such a bad thing."
While traditional sea-air took cargo from the Far East or India, sailed it to Dubai and then flew it to Europe, Swift Freight has also been a
pioneer of a whole new market for the concept since 2006 - from Asia via Dubai into Africa. The forwarder charters freighters to fly on a
scheduled basis to such places as Kinshasa, Brazzaville, Lagos, Accra, Kigale, Lome and Bujumbura. It also works in partnership with
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Barloworld Logistics, supply chain management subsidiary of industrial multinational Barloworld, today announced a major growth initiative
by acquiring Dubai-based Swift Group and its affiliates in the Far East, India, UAE, Africa and Germany.
The acquisitions will catapult Barloworld Logistics into the global logistics arena, especially with regard to multimodal transport solutions,
with several niche services and logistics activities between South East Asia, the Indian sub-continent, Europe and Africa.
The Swift group is privately held and has grown an international network specializing in distinctive logistics solutions and services. Now in its
19th year of operations, Swift is a leader in global transportation and logistics, with well-established services between South-East Asia and
Western Europe and a number of innovative freight logistics solutions specific to African markets.
Swift has approximately 700 employees in its 46 offices in 21 countries, spanning the Middle East, Far East, the Indian sub-continent, and
Africa.
The acquisition will include the marketing operations of one of Swifts business partners in Germany, which has been responsible for the
commercialization of sea-air combined transport (a multimodal transport solution), operating from the Far East and the Indian sub-continent
via the UAE to various destinations in Europe.
Although Swift has made recent in-roads into China, Barloworld Logistics as part of its acquisition strategy is currently also finalizing the
acquisition of a Hong Kong-based logistics company to strengthen Swifts presence in the region and to expand Swifts product and service
offering.
Barloworld Logistics CEO Paul Stuiver, commenting on the rationale for the acquisitions, says, The skills, networks and clients of Swift and
its affiliates will enable Barloworld Logistics to provide niche, multimodal solutions in the global logistics arena. By expanding our freight
management services through their networks, we will become a significant player in a supply chain network that stretches from Asian
manufacturing to Western European and African consumers. In addition, the acquisition will consolidate our existing presence in Dubai, which
is already an important global logistics and trans-shipment hub. Most of the existing multimodal market originating from South East Asia is
trans-shipped through the UAE.
Stuiver sees significant growth potential. Swift has an extensive African network which offers Barloworld Logistics the opportunity to sell
additional supply chain services into these markets. There will also be synergies with the acquisition some years ago of local freight forwarder
ZATrans, now integrated into the Barloworld Logistics group. Multimodal transport services into Europe and Africa offer great promise as an
international delivery niche, comments Stuiver.
Swift Groups Chairman and Founder Issa Baluch confirms that he will continue to play a leading role in the Swift Group and that, It is a
milestone for Swift the staff, management and stakeholders to be recognized as an organization with a sound strategy and potential to grow
even further as an integral part of the Barloworld group. I am extremely happy and excited for this organization and I believe we have a bright
future ahead in pursuit of our corporate goal to serve the world from Dubai.
Swift was one of the first companies to reserve space in Dubai Logistics City for a purpose built logistics centre (29 000 sqm) and an
additional airside facility at the new World Central Airport to provide smooth air connectivity for shipments (25 000 sqm). At present, Swift has
a total of 18,000 pallet positions in its warehouses in the Jebel Ali Free Zone, capable of cool, air-conditioned, and dry storage.
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Services into Africa include Swift Perishable Logistics operating from the Dubai Flower Centre, offering African farmers and traders
opportunities to export perishables around the world via Swifts African network; and the acclaimed SAM (Sea Air Model) the first combined
sea-air transport solution into several destination points in Africa with scheduled services from origin points in the Far East and India, via transit
points in Dubai.
From a Barloworld group perspective, the transactions fit well with the solutions-based growth strategy being pursued in each of its core
businesses. Comments CEO Clive Thomson, The acquisitions set the platform for significant long term value enhancement for the Barloworld
Group, and emphasize the extent to which our Logistics business is well-positioned to take advantage of the opportunities presented by ongoing
rapid globalization and trade movements. From a strong home base in Africa, we are very excited about Barloworld Logistics spreading its wings
on the global stage.
Case Study Illovo Sugar
During 2007 Illovo Sugar and Barloworld Logistics were awarded a Platinum Award at the South African Logistics Achiever Awards
Illovo Sugar in South Africa produces more than a million tons of sugar annually from seven sugar mills. Approximately half is exported
whilst the remainder is distributed locally through 18 distribution points to over 2,500 retail and industrial customers in southern Africa.
During 2004 Barloworld Logistics was awarded a 10 year contract to re-engineer and manage all of Illovos outbound supply chain activities.
In support of the Illovo groups goals and strategy, the Barloworld Logistics team delivers an integrated logistics solution that:
Mobilizes and aligns more than 180 employees, 30 service providers, multimodal transportation activities and seven different management
teams to achieve common supply chain objectives;
Collaborates with other service providers to achieve mutually-beneficial improvements and operational efficiencies;
Integrates seven information systems across three companies using latest technology and support;
Provides visibility of key information for Illovos management, marketing and strategy departments;
Returns a superior service level with on-time delivery now at more than 96% from a starting point of 82% during 2004; and
Has achieved significant cost savings and efficiency improvements.
Significant additional savings have been identified through further re-engineering and optimization of the Illovo distribution network.
The increased efficiency and capacity created through Barloworld Logistics involvement has enabled Illovo Sugar to achieve sales volume
growth of more than 20% since 2004 whilst simultaneously improving service and reducing supply chain costs.
Owner-Drivers Latest Beneficiary of PPC Dwaalboom Expansion
PPC Cements Batsweledi expansion project is bringing economic benefit far beyond the towns surrounding the companys Dwaalboom
facility. The most recent beneficiaries of the R1.36-billion expansion project are 44 owner-drivers, appointed by Barloworld Logistics Africa to
provide transport services to PPC. As part of a five year agreement between PPC Cement and Barloworld Logistics Africa a total of 340,000
tons of cement per annum will be transported by the owner-drivers.
With the boom in the construction industry and the increased demand for cement its essential that we were not left with a shortage of
vehicles or a break in the supply chain to our customers, said Orrie Fenn, chief operating officer, PPC. The services provided by the 44 ownerdrivers contracted to Barloworld Logistics provide us with the assurance we require.
Barloworld Logistics Africa entered into a five year contract with the owner-drivers and assisted them with finance to purchase their vehicles.
As an owner driver, individuals are responsible for managing their businesses cash flow, income and expense accounts, cash books, balance
sheets and bank accounts.
Upon joining the program, owner drivers undergo basic accounting training to provide them with the necessary business skills to manage a
successful business.
Over the past 18 months our owner-driver pool has grown steadily. The transaction is in the true spirit of empowerment and enables
drivers to effectively own and manage an asset. This is a real departure from the traditional approach to contracts of this nature, says Stephen
Temple, Divisional Director, Barloworld Logistics Africa.
In addition to training support, Barloworld Logistics Africa offers the owner drivers accounting services and technical support to assist with
maintenance related matters. On-site vehicle maintenance and tire services are provided by third parties through maintenance agreements with
the owner-drivers.
Deliveries are scheduled by Barloworld Logistics Africa fleet controllers and vehicles are monitored to ensure the owner-driver adheres to all
traffic rules and regulations while providing PPC Cement with a service in line with the agreed levels.
At the end of the five year contract the drivers will have equity in their vehicles which will enable them to buy a brand new vehicle, by using
the existing vehicle as a deposit. Alternatively, the owner-driver could choose to work on other contracts and thereby grow his or her business.
To take part in the program, drivers apply for consideration to become an owner driver. Individual drivers are interviewed by the Barloworld
Logistics Africa Dedicated Transport Services management team and drivers are selected based on criteria including: years of service, highest
qualification, work performance as a dedicated transport services driver and a credit check rating.
PPC announced the details of its Batswaledi cement capacity expansion project in late 2005. The R1.36bn investment will increase the
companys inland cement capacity in South Africa by just over one million tons per annum. This additional capacity will supply both future
demand growth in the South African cement market and the eventual replacement of capacity from older production facilities which will be
retired when market conditions allow.
Unilever Signs With Barloworld Logistics For Bulk Distribution
Global FMCG company Unilevers South African subsidiary has entrusted the distribution of its full range of products to supply chain,
logistics management and solutions company Barloworld Logistics Africa.
This follows months of a rigorous process to choose a company that would land the deal with Unilever South Africa which, at R900-million
over six years, is reputed to be one of the largest FMCG logistics contracts in South Africa.
The appointment of Barloworld Logistics Africa coincides with the reorganization of Unilever South Africa in keeping with the global One
Unilever strategy to operationally unite the Foods and Home & Personal Care (HPC) divisions.
Gail Klintworth, head of Unilever South Africa, said for the past four years there had been two independent ambient distribution networks
servicing the Foods and Home & Personal Care (HPC) businesses.
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The One Unilever vision necessitated the creation of a single ambient distribution entity that could better leverage its scale while adding to
marketplace competitiveness, delivering functional excellence and being more cost effective
Now we will be able to distribute various products through a common channel, thus reducing costs and making our business more effective
while improving the service our customers enjoy.
Klintworth said Barloworld Logistics Africa would assume responsibility for all bulk distribution of household and personal products from 1
July 2007 and ambient food products from early 2008.
Neil Larkens, Executive: Supply Chain Management at Barloworld Logistics Africa said his company landed the contract because of its
record of success, the culture fit between the two organizations and Barloworld Logistics flexible and responsive approach to all its logistics
projects.
Our aim is to achieve marketplace differentiation for Unilever, without them having to own operational assets. Our focus is on building a
cost effective world class delivery capability for Unilever.
As part of the plan to achieve this, the Barloworld Logistics team will be integrated into Unilevers Customer Service Centre. This puts the
4PL operations into the heart of the clients business, demonstrating leading-edge thinking.
Unilevers professional win-win approach and their courage in challenging the status quo for the betterment of the industry make this an
exciting project to work on.
Barloworld Logistics will service the contract on a Fourth Party Logistics (4PL) basis in 4PL, logistics is controlled by a service provider
that does not own the assets to carry out logistics activities but out-sources to subcontractors, the 3PL.
18th Edition
Page 99 of 625
abornstein@bdpnet.com
215-629-8940
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1972
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
Strong international freight forwarder with a variety of value-added supply chain services.
KEY PERSONNEL
Richard Bolte Jr.
Arnie Bornstein
Tim Frear
Frank Osusky
Stephen Zimmerman
CFO
CIO
Ticker Symbol
1,220
165 **
Exchange:
2,350
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Oracle--OTM
Transportation Planning and Optimization:
Warehouse Management System (WMS):
CYBERLOG
18th Edition
Oracle--OTM
CYBERLOG
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Dow Chemical
Chemicals
DuPont
Chemicals
Pharmaceuticals
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Mexico
Bahrain
Botswana
Brunei
Guam
Belgium
United States
Cambodia
New Zealand
Croatia
China
Czech Republic
Antigua
Argentina
Aruba
Bahamas
Barbados
Bermuda
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Grenada
Guatemala
Haiti
Honduras
Jamaica
Netherlands Antilles
Nicaraqua
Panama
Peru
Puerto Rico
Trinidad and Tobago
Uruguay
Venezuela
Virgin Islands
Congo
Cyprus
Australia/New Zealand
BDP
Angola
Africa/Middle East
Asia/Pacific
Denmark
Hong Kong
Eqypt
Finland
Ghana
Isreal
India
Jordan
Japan
Kenya
Kazakhstan
Kuwait
Lebanon
Malaysia
France
Indonesia
Germany
Greece
Hungary
Ireland
Nepal
Italy
Morocco
Pakistan
Latvia
Oman
Philippines
Netherlands
Qatar
Saudi Arabia
Singapore
Norway
South Korea
Poland
Sri Lanka
Portugal
Taiwan
Romania
Mauritius
Seychelles
South Africa
Swaziland
Serbia
Thailand
Syria
Uganda
Slovakia
Vietnam
Slovenia
Spain
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
BDP is a leading freight forwarder with a strong emphasis on chemicals. Operations are high quality. BDP
handles customs brokerage for Dow Chemical and DuPont on about 600,000 containers a year.
Provider's Strengths
Good international freight forwarding paired with capable systems.
Provider's Weaknesses
US forwarder, BDP International (BDP) has announced the establishment of a new subsidiary company headquartered in Ho Chi Minh City.
While the headquarters will be in Ho Chi Minh City, BDP will also have representation in the other commercial centers of Danang and Hanoi.
Mike Andaloro, managing director of BDP Asia Pacific, said, "We are seeing a growing demand for Vietnamese produced goods in North
America, Europe as well as in other parts of Asia. We expect our customers will source more of their goods from Vietnam, and this new
company will allow us to continually support our customers as they expand their supply chains.
"With the changes to foreign ownership laws in 2014, we anticipate there will be an even larger increase in demand as more manufacturers
establish themselves in the exciting, vibrant market."
"As the global leader in chemical logistics, we see great potential for this sector to grow during the next few years. Many chemical companies
are looking to establish themselves in Vietnam, with some considering building manufacturing plants.
"In addition to chemical logistics, BDP will target the healthcare, retail, telecom, electronics and other manufacturing industries. Vietnam will
be a key element of BDP's strategy in Asia over the next decade as the nation emerges as a true economic powerhouse."
Project Cargos Lagging Impact
For carriers that rely on project business, the recession may only now be felt.
The long-expected lull in the project cargo market is here. Multipurpose carriers are looking for cargo, the extra workers that engineering firms
were hiring in droves are no longer on payrolls, and new projects are few in number.
There is certainly a downturn, one based on the price of commodities, said Dennis Mottola, Bechtels Houston-based manager of
18th Edition
corporate traffic and logistics and of Bechtel Global Logistics. Until commodity markets recover in price and in demand, the need for additional
facilities or increased capacity at existing facilities will remain stalled, he said.
Major projects generally take two or three years, and sometimes longer, to build. For many companies specializing in project cargo, thats
been a source of solace in a recession that has sent demand plummeting across the transportation world.
Bechtel, for example, is still working on projects that were started in 2007 or perhaps even in 2006. But work is being completed on projects
that began before the economic crisis hit, and it certainly looks like there is a gap between when those will be completed and when contractors
will see a return close to the 2006-2008 level of market activity, Mottola said.
Typically, said Dennis Devlin, director of global projects and energy for forwarder BDP Logistics, it takes about a year for the impact of a
recession to hit projects. One could point to a lack of funding for projects from roughly the fall of 2008 to the spring of 2009, Devlin said.
There was definitely a period when new projects were not being signed.
Because of that, he expects to see a slowdown toward the end of this year or in early 2010.
But he is not predicting catastrophe. Projects will continue. They will be financed. Not back to the extremely high levels of the past years,
but the bottom will not fall out, Devlin said. Recovering oil prices, stimulus funds and a growing interest in nuclear power also may have some
positive impact.
Globally, Chinese projects are rolling along and appear unaffected by the downturn, while Chinese investment in Africa and Latin America
is growing. In addition, BDP is involved in an array of projects in Algeria, Libya, eastern Europe, the Middle East and South America, Devlin
said.
In the U.S., however, the lull is apparent.
From 2006 through mid-2008, every contractor that I knew had lots of contracted help, Mottola said. We went through a pretty
extraordinary period . . . not just projects, but all around. Everyone was scrambling. E&C contractors were doing well to find enough people to
properly staff the work available in the market.
And for multipurpose carriers across-the-board, the situation definitely has changed, Mottola said. We see it just with the number of carrier
positions that are advertised. We talk to owners and operators. Weve got a pretty good understanding of who makes up the market. Weve seen
a tremendous increase in the number of open positions, of carriers (saying), We have this ship open in the U.S. Gulf or the Middle East or the
Far East.
Carriers are looking for cargoes again, as opposed to shippers scrambling for open vessel space, Mottola said. It has certainly shifted in
the other direction.
Understanding a service providers financial condition has become increasingly important in the down economy, Mottola said. We do
business with container and ro-ro carriers, the MPVs and heavy-lift guys, all of those, he said. When global container carriers have financial
problems, for example, it gets his attention.
We need those services. We are looking long and hard at anything that can fit in a box or go on a flat rack. What you can pay for a 20-foot
container today is so drastically reduced compared to when the market was a lot stronger, Mottola said.
They have always used containers for some project cargo, he said. When the market was hot, however, container and ro-ro carriers were not
terribly excited about out-of-gauge cargo. But now, many of the strictly container operators are very interested because their ships are laid up or
operating well under capacity . . . We looked at it previously, but we look at it even closer now. Is container carriage a solution for anything that
we have to move?
Even after the market recovers, the shipping industry may face a changed environment.
Container carriers may continue to bite into traditional multipurpose cargo for quite awhile because the container market is looking at a
drastic capacity overhang that may take years to sort out. The new bigger, faster container ships just keep coming. So there is going to be a lot
more capacity entering the market than is leaving the market. That will cause the container operators to look anywhere they can to employ their
ships, Mottola said.
In fact, all carriers have additional capacity now, even the heavy-lift guys, and they are the last in our market that will see the effect of the
global economic slowdown, Mottola said. Heavy-lift pieces, especially those more than 500 tons, are booked well in advance of shipment,
sometimes as much as six to 18 months out when demand is hot. But even these carriers will see a lull, he predicts.
Jeroen Kock, Houston-based vice president for the Americas with super-heavy-lift specialist Jumbo Shipping, sees similar signs. He said the
refinery upgrades that fueled project cargo movement to the U.S. over the last couple of years are mostly completed, although a few still are
under way. For example, Jumbo recently discharged two reactor vessels, one weighing 1,610 metric tons, at Baton Rouge, La., for a Valero
refinery upgrade, and will deliver a similar shipment to Port Arthur, Texas, later this year.
However, for the most part, the heaviest components and much of the smaller pieces are already shipped, Kock said. And when there is still
cargo coming in, the contracts are mostly in place.
There may be windmills to the left and right, Kock said, but they make up only a small percentage of the U.S. power supply. There has to
be other (project cargo) coming in, he said. There will definitely be other power plant upgrades and so on, including nuclear. However,
although some projects are kicking off now, he said, they may not sail for many months. Meanwhile, people in the industry are realizing the
looming lag could mean that business will suffer next year.
Paul Wilson, vice president of Intermarine, said exports have fallen roughly 20 percent across the board in markets where Intermarine
operates project cargo liner services, in Colombia, Venezuela, Trinidad, Brazil and other parts of Latin America. However, he said, we believe
we have flattened out; we hope we are at the bottom.
Plants are beginning to get the go-ahead to start purchasing for mining, refinery and power projects, he said, probably beginning in the
second half of 2010. We are expecting a return to what we call normalcy in 2011, Wilson said. That may seem far away, but in the project
business, thats just around the corner.
Wilson said Intermarine carries wind energy components, especially in north-south trade, but he anticipates a slowdown there beginning in
2010. The government stimulus package could keep cargo moving if financing and approvals are available, but the market is maturing and
manufacturing appears to be shifting to the U.S. Thats probably the biggest reason to expect a slowdown, he said.
Others say carriers face a basic problem in the low demand for foundation breakbulk goods.
What is causing us heartache right now? said Jerry Nagel, Houston-based president and CEO of Rickmers-Linie USA Nagel. For Rickmers,
which employs ten 30,000-deadweight-ton multipurpose heavy-lift vessels on its round-the-world breakbulk service, its the missing
commodities. Steel, pipe, plywood, coils, big bagged goods, ores those cargoes are missing. We have project. We have full ships. But we dont
have good earning ships. Weve got a load of feathers and no lead under them, he said. We are missing the proper mix.
And although housing starts and sales may be inching up, there is a lag between rising demand and when builders and suppliers actually start
ordering plywood. Oil is similar, Nagel said. Once oil stays above $70 (a barrel), people will want to do more drilling, so they will need pipe. But
before they order it from overseas, we will have to empty out the pipe here in the U.S.
Big steel parcels are no longer moving, he said. However, from his perspective, wind energy cargoes are still big business into the U.S., and he
expects that to continue as long as tax credits and government policies encourage investment.
18th Edition
The Port of Houston is also seeing the slowdown. Houston had a good year in 2008 for project cargo and breakbulk steel, said acting
Executive Director Wade Battles. That held true through the first quarter of 2009, and then the port saw a substantial drop.
The port is expecting about 400 wind turbines to come in soon, but thats as far as we can see right now, Battles said in late August.
Generators and refinery-related cargo is down.
The port is using the lull to do maintenance work at the Turning Basin and may take down an older shed to open more space for project and
breakbulk cargo, Battles said.
Joe Burkett, general manager of Texas Terminals, a privately owned breakbulk terminal on the Houston Ship Channel, said a healthy amount
of oil-related exports are crossing the dock. Much of it is headed for Far East shipyards that are building drilling vessels, although some has gone
to Dubai. Theyve also loaded drill rigs for North and East Africa.
The offshore stuff is moving very steadily, Burkett said. Building a drill ship takes about three years, with these project components needed
near the end of the process. The backlog used to be five or six years, he said. Its not like that now. But these vessels are still under
construction; theres still a need.
But inbound oil-related Tenaris pipe shipments have fallen off sharply. The typical monthly throughput used to be 35,000 tons. Now we are
lucky to have 5,000 tons, Burkett said. The need for pipe in this country has really dropped off. Our (land-based) drilling rig count comes out
in the paper every week. A year ago, we had 1,980 operating and now there are only 900.
Mottola said such declines test the mettle of even strong companies. The tables have turned, and they will turn back again, he said, and all
sides in the project cargo sector need to maintain their integrity as shippers deal with carriers. You are going to need them, and they are going
to need you. There is an opportunity now to move cargo at a much lower cost, but that doesnt mean you forget about the things that you pay
attention to when the market isnt going your way.
BDP acquires UK freight forwarder
BDP international (BDP), the US freight forwarding company, has acquired UK-based Rostrum Forwarding Ltd., Dartford, Kent. The
company's name will be changed to BDP International, and it will operate under the continued management of Rostrum's Managing Director
Bruce W. Pope. Terms of the transaction were not disclosed.
"Rostrum and BDP represent a good fit between two like-minded companies that are zealously committed to customer care, operational
excellence and a mutual respect for one another's traditions and cultures," said BDP's Chief Operating Officer John M. Bolte. "Beyond the
competitive necessity of having a more substantive presence in the UK, it further enhances our flexibility and service capacity for customers
between this vital market and the world.
"For Rostrum and its valued customers, joining the BDP family will mean access to a comprehensive suite of logistics information visibility
tools and a solid presence in the world's leading and emerging markets through our global network of offices and strategic partnerships in more
than 120 countries," he explained.
In addition to its Dartford, Kent, headquarters, Rostrum has receiving depots in Birmingham, Bristol, Heathrow, Leeds, London, and
Manchester. BDP has invested immediately to expand the operation's service portfolio with the opening of an office at the London-Heathrow
Airport earlier this month. BDP International in the UK will offer a range of transportation and logistics services, as well as value-added services
such as insurance, packing, warehousing and distribution, and on-line shipment management and visibility tools.
BDP Project Logistics forms Czech unit
PHILADELPHIA and PRAGUE, February 19, 2009 BDP Project Logistics has established an office in Prague to meet Central and
Eastern Europes growing demand for its services. In addition to the Czech Republic, the new office will focus on business development in
Slovakia, Hungary, Poland, Romania and Bulgaria.
"Expansion of the E.U. to include former CEE countries, subsequent growth in direct foreign investment and a continuing shift of
production facilities from Western Europe make this region a particularly strong market for project logistics," said Luc Van Heygen, BDP
Project Logistics managing director for the Americas and Europe. "This new office, which will have the support of our European headquarters
staff in Nuremberg, puts us closer to our clients and clearly demonstrates our commitment to project logistics in the region."
The companys parent, BDP International, established a presence in the Czech Republic in 2007, when it formed a joint venture with Czech
logistics firm, Wakestone sro.
Based in Prague, BDP Project Logistics sro offers a complete portfolio of services relating to the movement of project cargo, including road,
rail, river, ocean and air transportation and related services to support construction and expansion projects for the power generation,
infrastructure, mining, oil and gas, chemical, alternative energy and other industries. In connection with these services, it will provide end-to-end
materials management and tracking, freight consolidation and carrier cost maintenance, logistics process analysis and optimization,
documentation, coordination of cargo inspections, inland transportation and scheduling, and supervision of heavy lifts, and hazardous cargo,
port operations, jobsite unloading and checking, and special customs services under the Czech Republics free customs zone.
In addition, BDP Project Logistics recently established an engineering division based in Leipzig, Germany, that provides professional route
surveys, method statements and infrastructure-related structural engineering calculations, as well as technical methods for lifting and positioning
heavy equipment.
Heading the new operation is Milos Molnar, project manager, who has been working with BDP Project Logistics for the past two years, with
sales and business development support from Emanuel Scerra, regional director, Europe; Stan Turek, strategic sales and procurement, BDPWakestone; and Karel Babicek, country manager of the Czech Republic, also BDP-Wakestone.
BDPProject Logistics sro
Milos Molnar
Project Manager
Malesicka 16
130 00 Prague
Czech Republic
Tel: +420 267 311 262
Fax: +420 267 311 263
Mobile: +420 721 110 110
Email: milos.molnar@bdpprojects.com
For more information, contact Elizabeth Parke, Manager, Marketing & Proposals, BDP Project Logistics, 1646 Rankin Road, Suite 100,
18th Edition
Houston, TX 77073 USA; Tel: 281-233-4777; Fax: 281-233-4791; Email: elizabeth.parke@bdpprojects.com. In Europe, contact Karel Babicek;
Tel: +420 267 311 262; Fax: +420 267 311 263; Mobile: +420 602 187 845; Email: karel.babicek@wakestone.cz.
Keeping it in the family can be good
[By Richard Bolte Jr. President & CEO of BDP International, The Business Times, November 6, 2008]
Well-run family-owned businesses can thrive for generations, enjoying advantages that conglomerates don't have.
ONE of the common fallacies about family-owned companies is that they can never grow to be large companies.
When my father, the late Richard J Bolte, started his small export business 40 years ago, I doubt he envisioned his enterprise growing into
BDP International - a logistics company turning over more than US$1.6 billion annually.
Today, members of my family still take an active role in the management of the business. We remain 100 percent family-owned. And we
choose to stay that way.
While many see a public listing, a merger or an acquisition as the ultimate goal - and a sign of becoming one of the 'big boys' of business family ownership structures provide opportunities that more splintered ownership models do not.
Throughout the post-war period of the 1950s and '60s, family-owned businesses were the building blocks of America's amazing economic
growth. Now, family-owned and run businesses are more associated with the Asian approach to management than the US. Today, in Singapore,
there are thousands of family-owned and managed companies - some large, some small. The question for these companies is whether they can
achieve their full potential with their current structure or whether they should consider a different approach.
It is a question we have asked ourselves many times at BDP International. So what is it that keeps BDP from going public or looking for a
sale? What are the characteristics of a family-run business that give it an advantage over other ownership models?
Be fast
The first advantage - and arguably the most important - is the speed of decision making. This does not mean making rash or hasty decisions.
It means that once a decision is made, the whole business machine swings behind that objective instantly. Unlike a listed company, we can take
advantage of opportunities without the need for circulars and AGMs which flag your intentions to your competitors. When our competitors
figure out what we are doing, we are already up and moving.
It's about relationships
With a family-owned business, we place greater emphasis on the relationships we have with customers. They know us - individually as
people. The interface our customers and vendors have with us is through our people.
We know customers choose to do business with us because the experience they have with our people is personal. It is a relationship that
instills confidence and conveys gratitude.
Of course, this is in contrast to the one-size-fits-all approach of many mega companies - especially the mega forwarders.
Some are so large that their customers have to adapt their systems to access their services. A family-owned business approaches it from the
other direction: how can we change to accommodate the needs of our customers.
Ethics and values matter
Another advantage of family-owned businesses is the focus given to maintaining your values and acting ethically. There are many who see
ethics as a weakness, but ask yourself: if you have the choice of doing business with an ethical company or one with a more dubious reputation,
which would you choose? Ethics matters. And to a family-owned company, it means everything because it is the family's name that stands
behind the company; it is your family's good name and honor on the line.
Don't build a company - build a legacy
Family-owned companies have the luxury of taking the long-term view. The objective of our effort is not to squeeze a piece of short-term
gain at the expense of the future. Rather, it is to build a legacy which can be enjoyed by this generation and handed on to the next. The pressure
to achieve short-term results can cloud the judgment of many sensible managers and forces them to make decisions which clearly put the longterm viability of their companies at risk.
Extend the family
The sense of family must extend beyond blood ties. A family-owned business should 'feel' different to work for; in my opinion, it should be
better. Family values should give everyone a sense of belonging, of camaraderie. And like all good families, we must acknowledge the
contribution made by individuals and reward it with gratitude. While it may sound clichd to talk of all the employees being 'one big family', the
sense of belonging and of shared achievement is very real within a well-run family business.
Communication and merit
A key ingredient to making a family- owned business work is to communicate with your employees and to reward on merit. Failure to do
either results in a sense of division and favoritism within your business.
The importance of face-to-face communication is the ability it gives you to convey your passion and your humanity to your staff. If the
leadership can demonstrate their passion and commitment to the shared goals, then the employees will respond much more positively than if
they were forced to sit for a couple of hours and watch a video or a slideshow.
And promotion on merit is a must if you want to survive from generation to generation. By all means, nurture the talent within the family
but always reward the deserving by giving them the jobs they are best suited for - regardless of whether they are family members or not.
In fact, failure to attract and retain good people to your business is one of the reasons many family-run businesses stay small - they just do
not have the experience within their own circle and they are too scared to go and find it in the open market.
In good times and bad
18th Edition
These are a few of the reasons BDP has remained a privately-owned business for more than four decades. It's not as if we have never been
approached by bankers wanting to take us public or multinationals wanting to absorb the company into their operations. I'm not saying there
will never come a time when a sale, merger or a public listing is the best course for our company. But right now there are many benefits to
keeping it in the family.
And in the current climate of economic tumult, many of the benefits of being family-owned are brought to the forefront. Ask yourself: what
type of company do you want to give your business to - one that is desperate to achieve short-term gains at the expense of quality and service?
Or one that is in it for the long haul that believes relationships are the building blocks of a generational legacy?
A business is a lot like a family - everyone must pull together in bad times so that when the good times return, you are stronger for the
experience.
BDP's global alliance
18th Edition
Company Name Beijing Hua Ri Fei Tian Freight Transportation Co., Ltd
Address:
No. 1 Dayangfang Rd., YiZhuang Town, Daxing District, Beijing, China
Phone Number: 86-10-87396326
Email Address: hrftly@sina.com
Fax Number:
86-10-87396327
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Yuan Liu
General Manager
Jianhua Wang
Xingyue Qi
Marketing Mgr.
Logistics Mgr.
Jian Zhang
Xuejun He
Finance Mgr.
IT Mgr.
Ticker Symbol
2 **
Exchange:
161
8
3
ASSETS
Total Transportation Assets:
Total Tractors:
15
Total Trucks:
Total Trucks:
35
Total Other:
Total Trailers:
Total Aircraft:
15
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.022
0
2
Total Tankers:
Total Other:
MAJOR MARKETS
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Cadbury
China
DHL
China
DOVE Chocolate
China
Hagen-Dazs
China
China
Heineken
Beverages
China
Hormel Foods
China
Kraft Foods
China
McDonald's
Food Services
China
Nestle
China
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
China
EDITOR'S COMMENTS
Since its inception and still today, Beijing Hua Ri Fei Tian mainly provides refrigerated transportation. Its
available capacity includes 198 trucks, 105 tractors and 60 reefers.
Provider's Strengths
Refrigerated transportation.
Provider's Weaknesses
Size and scope of services.
18th Edition
86-10-60538545
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1992
Asset Focus:
Market Area:
Founding Business:
China
Distribution
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Yu Zhang
CEO
Allen Liu
Xiangrong Xie
VP Corporate Development
Secretary of the Board
Jianlun Jing
Jingxue Sun
CFO
Chairman of the Board
86
20 **
Exchange:
800
OTCBB
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
225
Total Other:
Total Trailers:
Total Aircraft:
60
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
31.2
Total Tankers:
Total Other:
MAJOR MARKETS
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
China
China
China
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Beijing Logistic
Latin/South America
China
EDITOR'S COMMENTS
Beijing Logistic's revenues grew 51.8% in 2007. Beijing Logistic divides its business into three divisons/industry
segments: publishing, timber, and agricultural (eggs)/medical (Chinese herbal medicine). The publishing segment
was 60% of its revenue for 2007. It is ranked No. 1 in the book transportation industry in China.
Provider's Strengths
Domestic storage and distribution of books and magazines.
Provider's Weaknesses
About the future, she continued, for 2008, our economic activity is expected to continue to expand with a moderate pace. As a result, we
expect our revenue trends to moderate in 2008, with growth driven by books and magazine logistics management. In order to support long-term
volume growth, we expect to open additional distribution centers in China, launch new warehouses, and improve our warehouse storage volume
and operational functionality to plan, receive, process, and invoice activities.
18th Edition
32-3-234-02-24
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1982
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Luc De Smedt
General Manager
Pol Nelen
Leo Moonen
Forwarding
Forwarding
Ticker Symbol
11
6 **
100
10
1-5
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Food, Groceries
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Latin/South America
North America
CUSTOMERS
Europe
Asia/Pacific
Australia/New Zealand
Industry
Location
TM
WM
VA
DCC
Inte IM
Food Production
Gcamines
TAS
Packaging, Containers
Tractebel Engineering
Energy
18th Edition
Asia/Pacific
Europe
North America
Belfor Logistics
Latin/South America
Belgium
EDITOR'S COMMENTS
Belfor (Belgian Forwarding) Logistics, provides transport logistics (project logistics), encompassing land, sea
and air traffic. The company emphasis is in organizing and coordinating transportation of industrial projects and
conventional cargo through any port, worldwide.
Provider's Strengths
Project logistics.
Provider's Weaknesses
Agent dependance - limited range.
(Belgium) for account of Interox International (joint venture between Tractebel/Solvay/Coppe Courtoy).
We completed the forwarding of about 32.000 FT project material from the North Continent of Europe plus the States to the Map Ta Phut
P.V.C. plant via Sattahip port (Thailand). Our principals were Vinythai in Bangkok and Tractebel Industrie/Solvay in Brussels.
Furthermore we co-ordinated the transport logistic of several huge power station projects for account of Messrs. Cockerill Mechnical Industries
to Bahrain, the Emirates, to Rayong in Thailand and Mexico (Rio Bravo project).
For account of Messrs. Arsopi and John Brown, we co-ordinated a huge multi-modal transport of 6 exceptional heavy and out of gauge lifts
weighing max. 150 T. upto 45 m long, from Leixoes by means of a self-sustained heavy lift carrier to Hamburg, from where special barges
carried the cargoes to Aken on the Elbe and finally reached the Solvay Bernburg works by multi-wheeled extendable low-bed trailers.
We also succeeded in efficiently co-ordinating the multi-modal transport from Antwerp to final job site Mindelo (Cap Vert) including erection,
of a complete desalination plant total 600 T./2.500 m3 including HEAVY LIFT over 300T unit weight, transported in one shipment on board
of a specialised RO/RO heavy lift carrier.
For account of Messrs. Heurtey Petrochem Engineering from Antwerp to job-site delivery the A.Y.T.B. Yard in Al Jubail by means of a selfsustained heavy lift carrier, the VCM expansion project consisting of in total 37 packages for 278 T. including two heavy lifts of 110 T., dim.
17.3 x 2.7 x 4.07 m and 40 T., dim. 19.47 x 52.0 x 5.11 m
Transport and logistics of the Sodi Devnya Project (Bulgaria) about 2.000 cbm / 500 mt of heavy lift and out of gauge cargo from North/South
Europe via Antwerp and Lyon to Devnya-Varna (Bulgaria).
Indupa S.A.I.C. PVC Expansion project in Bahia Blanca Argentina. Ca 10.000 freighttons generals + heavy lift cargo, autoclaves in one
shipment from ex Japan + USA + European factories up to free on truck jobsite Bahia Blanca.
Hispavic PVC Plant. One shipment ca. 4000 freighttons from ex Japan + European factories upto Martorell via Barcelona.
Coek Engineering about 4.500 freighttons heavy lift + out of gauge petroleum equipment - project cargo - in one go from FCA Factory in
Belgium upto Bandar Emmam Khomeini - Iran.
Transport of 16 modules ca. 150 tons U.W. each for the Tucuman project - Argentina via Buenos Aires for the account of Cockerill Mechanical
Industries.
In 2000 we started chartering and sea transportation of different polymers, Polyethylene products ex Ras Lanouf (Lybia) for storage and
distribution to several European destinations. (annual abt. 30.000mtons)
18th Edition
piet@bettr.be
32 9 343-83-94
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2001
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Piet Lips
CEO
Frank Verhaest
Hans Borgers
Ticker Symbol
25
5 **
73
30
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
California Direct
Belgium
Hain Celestial
Belgium
Ontex
Belgium
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
BettR
Latin/South America
Belgium
EDITOR'S COMMENTS
BettR is a TMS specialist with optimization capability. BettR is a good solution for small to medium-sized
companies.
Provider's Strengths
Flexibility and quick response.
Provider's Weaknesses
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
United Kingdom
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Iain Speak
CEO
Tony Mohan
Alan Paterson
Marketing Director
Operations Director
Paul Cullingford
Robert Lee
CFO
IT Director
287
Ticker Symbol
287 **
Exchange:
2,300
89
3
ASSETS
Total Transportation Assets:
Total Tractors:
220
Total Trucks:
Total Trucks:
215
Total Other:
Total Trailers:
Total Aircraft:
685
Total Ocean:
Total Tankers:
Total Other:
Total Reefers:
Total Flatbeds:
40
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
JDE
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
AeroBed
UK
Antalis
UK
Arla Foods
Food Production
UK
Braitrim
Packaging, Containers
UK
UK
DS Smith
Packaging, Containers
UK
First Milk
Food Production
UK
Golden Wonder
UK
IM Group
UK
Kellogg
UK
Lucite International
Chemicals
UK
Suzuki Motor
UK
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Bibby
Latin/South America
United Kingdom
EDITOR'S COMMENTS
Bibby Distribution is one of the largest 3PLs in the UK. Operating from 58 sites across the UK, it has solid,
modern skills in the automotive, FMCG, food/dairy, and industrial verticals.
Provider's Strengths
Transportation, inventory management.
Provider's Weaknesses
Limited to the UK.
Bibby Distribution has reported record profits for the second consecutive year, with profits of 5.8 million on turnover of 185.1 million for
the period January - December 2009.
The company's latest financial results show 21.8 % growth in pre-tax profit despite a very challenging trading environment.
There was a marginal dip in turnover on a like-for-like basis of around 6%, reflecting the general state of the economy in recession.
EBITDA was at a record level with an annual increase of 12% and the company is now virtually debt-free.
Chief executive Iain Speak believes Bibby Distribution has outperformed the market and exceeded its growth targets through a combination
of new initiatives aimed at managing costs, producing efficiencies and delivering outstanding customer service across the business.
While the stability and reputation of the company has led to several new contract awards, Speak noted that more than half of the company's
business is now founded on customer relationships of ten years or more.
The company has also said that the recent acquisition of Taygroup is likely to be followed by further acquisitions during 2010.
Case Study
Overview
Lucite International & Bibby Distribution have been working together for 16 years. The initial site was the first former ICI facility to be
outsourced to a 3PL provider. By successfully delivering on joint strategic initiatives the relationship has grown into a thriving supply chain
partnership. Bibby Distribution has taken ownership of logistics complexity to allow Lucite to concentrate on its core activities.
Customer
Formerly known as ICI & Ineos Acrylics, Lucite International is the largest global manufacturer of Methyl Methacrylate (MMA). This acrylic
sheet forms into 2 Main products; Lucite sheet used for bathroom and spa products and Perspex sheet, used for signage, lighting and building
fabrication products.
Current solution
Bibby Distributions Walker Park facility is the largest Acrylic sheet cutting operation in Europe. Our responsibility starts at the end of the
production line and ends at the final customer. Deferred production forms an integral part of this full contract logistics solution which covers
warehousing, domestic and international transport.
Service Offering:
Warehousing: 24/7 Operation, 147,000 sq. ft. site
UK & International distribution of oversized product
Management and consolidation of Inbound International deliveries
Deferred production: 4 Saws for sheet cutting linked to sheet optimization software
Revenue generation: Selling of previously scrapped off-cut material
Systems integration: SAP R3 ERP Linked to WMS (Questar)
Sales & Operational planning
Bi-lingual Bibby Distribution Customer service team
Contract Evolution
1992 - Bibby Distribution becomes the first ever 3PL selected by ICI to outsourcing acrylic cutting operations for their Blackpool Cutting &
distribution centre
2000 - Implementation of Project Focus reducing fixed costs by 500k per annum
2001 - Bibby Distribution design, build and capital fund a purpose built warehouse in Blackburn including a 2m Bibby Distribution investment
in a state of the art sheet cutting operation.
2001 - Implementation of Project Colt reduction in cost to serve per Tonne
18th Edition
Leading UK logistics provider Bibby Distribution has completed the acquisition of Taygroup Ltd, a major supplier of transport and
warehousing solutions.
Founded in 1992, Taygroup operates from a head office in Biggleswade, Bedfordshire, as well as sites in Wigan, Cardiff and Melksham and
has developed long-standing relationships with a number of blue-chip customers, including many high street brands. Taygroup shareholders, Jon
Wright and Lloyd Dennaford, will remain with the business.
The move is the latest in a number of strategic initiatives from Liverpool-based Bibby and represents a significant contribution towards the
company's aggressive growth plans. Acquisitions will be supplemented by organic growth and new business wins.
Over time Bibby will integrate Taygroup into its UK operations, driving efficiencies and added value to both existing and new customers. As
part of this integration the business will take on the Bibby Distribution name.
Iain Speak, Bibby Distribution's Chief Executive Officer, says: "Taygroup is a vibrant and dynamic business with a real focus on delivering
excellent service to its customers. The acquisition strengthens our overall service offering in a number of key areas and enables efficiencies that
will enhance our ability to provide the market with flexible, competitive solutions.
"I am particularly pleased to welcome our new colleagues to Bibby Distribution and look forward to working with them to continue their
success under our stewardship."
Jon Wright, former managing director of Taygroup, says: "We are pleased to confirm the sale of Taygroup to Bibby Distribution. I am
convinced the company is the ideal partner to help realise the potential of the business and am personally looking forward to becoming part of
the Bibby team to make sure this happens."
The deal raises Bibby Distribution's annual turnover by around 10 per cent and adds 300 road assets to the existing fleet as well as expanding
its operating footprint by four sites to a total of 62 locations.
Case Study
Overview
Bibby Distribution & Arla Foods have worked in partnership for over 13 years. The contract has quadrupled in size within that time and Bibby
Distribution ensures that Arlas ambient customers always receive their deliveries on time and in full. The recently built, flag ship site at Elland
marks the next stage in the supply chain partnership and lays a firm foundation for the future.
Customer
Arla Foods UK plc is home to some of the UKs leading dairy brands including Cravendale, Lurpak and Anchor, processing over two billion
liters of milk a year. Arla continues to be one of the UKs leading dairy companies supplying many chilled and ambient UHT products into
supermarkets and stores every day. Within their milk product portfolio, they have a variety of brands and added value products including fresh,
flavored, UHT and powdered milks.
Current Situation
The joint Bibby Distribution & Arla warehouse is located at Elland in West Yorkshire, a prestigious new site specifically commissioned to house
Arla Foods ambient temperature products. Arla is the anchor customer in this Multi-Customer facility that also houses Bibbys Northern
distribution fleet.
Service offering
National next day distribution
126,000 sq ft new facility (19,000 locations)
RF technology including managing different delivery units
Bespoke WMS Interfacing with SAP ERP system
1.2 Million cases delivered per annum
18th Edition
Bibby Distribution has been awarded a new contract to provide a farm collection service for farmers' cooperative First Milk in West Wales.
Bibby retained a similar contract in Scotland and North Cumbria, as part of a comprehensive review and tender process.
Bibby has also secured a contract for the nationwide management of First Milk's secondary distribution operation, which is scheduled to start
this summer.
The contract means that Bibby Distribution will be responsible for collecting around 3.5 million liters of milk from farmers every day,
delivering it both directly to First Milk creameries as well as First Milk's customers under the national secondary deal.
On the national secondary operation, Bibby Distribution will work alongside Lloyd Fraser, who will provide the farm collection service for
First Milk in central England and east Wales.
According to Bibby Distribution divisional director Ian Firth, the company has been working with First Milk since the mid-nineties, and this
win has effectively doubled Bibby's stake in the market.
Bibby Distribution aims to double turnover and profit
Bibby Distribution plans to more than double turnover and profit in the next three years, following further financial improvement last year.
Chief executive Iain Speak says: "Our three-year plan sees us more than doubling profit and turnover. We're in advanced discussions over an
acquisition that will benefit our numbers; it plugs a hole and gives us a couple of new services we can scale up [to our existing customers].
"Acquisitions both core (trucks and sheds) and logistics support services are in the plan; new services are in the plan; and we've got to
win more new customers. The board is focused on the plan, and we've got one corporate development director solely concentrating on
acquisitions and developing new niche services. It's then about doing what we do, well."
The decision to announce these targets to the market is driven by an internal initiative, Project Differentiate, which is designed to change
perceptions of Bibby and thus help the targets to be met. Speak says: "This is about us putting our head above the parapet.
"We don't want to become the king of spin, but we do want to address the common market perception that we are northern-based, small,
simple a trucks and sheds company. We're a lot more than that. We've got to raise our profile."
The year to 31 December saw Bibby boost pre-tax profit by 12.7% to just shy of 4.8m (a company record) as turnover increased 3.3% to
187m.
Chief financial officer Paul Cullingford adds: "We've now got virtually no debt and minimal gearing. We've got a very healthy cash position:
we're well positioned to go out and do a bit of shopping."
Indeed, cash at bank more than tripled from nearly 2m in 2007 to 7m last year.
Bibby's first-quarter performance is strong too, according to Cullingford, with turnover static and profit ahead of an aggressive target.
Bibby on the Rise
Bibby Distribution, one of the UKs leading providers of Logistics Solutions are delighted to announce their association with AEROBED,
the market leader in quality inflatable beds. Aerobed was founded in 1992 when an innovative way to quickly inflate and deflate air mattresses
was patented, which is a key feature of their product!
18th Edition
Aerobed have awarded Bibby a 4 year contract to be based at the Companys Meir Point site in Stoke on Trent.
Aerobed Managing Director Julian Williams stated "We had quotes from three large logistics operators as well as Bibby Distribution, but
Bibby demonstrated a real understanding of our business issues and were very proactive in suggesting improvements that could be made to the
supply chain. One of the key advantages is the 'end-to-end' solution including sea freight which was not part of our initial thinking but was
brought to our attention by Bibby and has definitely lowered our costs and lowered the cycle time for getting goods into warehouse"
"Previously the business had chosen logistics partners based on what was perceived to be low cost. However, my experience has been that
you get what you pay for and since moving to Bibby our service levels have improved beyond recognition which has driven our internal costs
down and customer satisfaction is at an all time high"
"Moving to Bibby Stoke has actually been a 'double whammy' because whilst we have our supply chain considerably we are also paying less
money and we cannot ask for more than that!"
18th Edition
Fax Number:
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1964
Asset Focus:
Market Area:
Founding Business:
South America
Road Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Emlio Binotto
CEO
Djalma Miranda
Edilson Srgio Binotto
Marketing
Logistics
CFO
CIO
30
Ticker Symbol
24 **
Exchange:
2,876
68
3
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
389
Total Trucks:
555
Total Trucks:
555
Total Other:
199
Total Trailers:
Total Aircraft:
953
Total Ocean:
Total Other:
33
1.13
6
Total Tankers:
Total Other:
515
MAJOR MARKETS
Automotive
Elements
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--SETAM
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--SETAM
Proprietary--SISARM
18th Edition
Proprietary--SISBIN
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Alcoa
Metals
So Paulo, Brazil
ArcelorMittal
Metals
So Paulo, Brazil
Novelis
Metals
Pindamonhangaba, Brazil
VW Caminhes
Resende, Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Binotto
Latin/South America
Brazil
EDITOR'S COMMENTS
Binotto specializes in the agriculture and forestry industries. From seed development, planting, and harvesting
to final distribution.
Provider's Strengths
Forestry niche.
Provider's Weaknesses
If you see us on a day-to-day basis, driving around the country, it is because we are doing our job very well.
With the development and implantation of SIGA - Sistema Integrado de Gesto Aplicada (applied management integrated system) - Binotto
conquers another quality certificate: the SASSMAQ Sistema de Avaliao de Segurana, Sade, Meio Ambiente e Qualidade (Evaluation
system of Safety, Health, Environment and Quality).
Audited by BSI from June 12-16, Binotto obtained the SASSMAQ certificate.
The SASSMAQ was developed by ABIQUIM (Brazilian Association of the Chemical Industry) and is applicable to all the service providers
that involve chemical and petrochemical products, be them dangerous or non-dangerous.
The main objective of SASSMAQ is to reduce, in a continuous and progressive form, the risk of accidents in the transport operations of
products. Furthermore, the system intends to: standardize and quicken the selection of the logistic service provider and maintain a single
evaluation system, recognized by all clients in the sector; to differentiate the service providers and give them privileges and priorities in
contracting.
The SASSMAQ system is based on a model applied with success in Europe by Cefic European Council of Federations of Chemical
Industries. The central elements are evaluated, according to the companys administrative, financial and social aspects, and the specific
elements, according to the services offered and operational structure. The SASSMAQ evaluation is not obligatory, but its application generates
an important differential for the companies certified by the system because of the corroboration that the company offers qualified services in
transport operations.
Based on the established industry requirements, through a process of evaluation (by BSI and others) made through an Evaluation Term
expedited by ABIQUIM, the transporters should obtain the qualification to transport products originated from this industry. Even if a company
already has the ISO 9000, 14000 or OHSAS 18000 certifications, it should also obtain the SASSMAQ.
Therefore, Binotto developed and implemented the SIGA project, involving all the procedures mentioned in the SASSMAQ. Now that all
the requested items are accomplished (through an evaluation of 680 questions), Binotto confirms the quality of its services also in the Chemical
Industry.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
Capable finished automotive logistics company with large car carrying operations.
KEY PERSONNEL
Detthold Aden
Andreas Hoetzel
Manfred Kuhr
CFO & IT
Container Division
Ticker Symbol
1,138
865 **
5,858
3-5
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
Total Trucks:
30
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
Total Trucks:
400
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): e.TLS/LOON
Transportation Planning and Optimization:
Warehouse Management System (WMS):
e.TLS/LOON
18th Edition
SAP R/3
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Audi
Hungary
Daimler
Ford Motor
Griesson - de Beukelaer
IKEA
Specialty Retailers
Konica Minolta
Bremen
MAN Group
Germany
Opel
Porsche
Rautenbach-Guss
Robert Bosch
Siemens
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Germany
Germany, Slovakia
Germany, Italy
Asia/Pacific
BLG Logistics
Europe
North America
Latin/South America
India
Czech Republic
United States
Brazil
Malaysia
Germany
Great Britain
Italy
Poland
Portugal
Russia
Slovakia
Slovenia
Spain
Ukraine
EDITOR'S COMMENTS
BLGs emphasis is on automotive logistics through Bremerhaven. Services include pre-delivery inspection,
painting, and installation of DVD players, GPS systems, mobile phones and sun roofs. About 4.7 million vehicles
were handled in 2009. BLG has extensive car carrying business for VW and Daimler. The Automotive division
generated 36% of revenue for 2009.
BLGs parent corporation was originally formed to provide port operations for Bremen. The German government
owns just over 50% of BLG. Sister company, EUROGATE, is the largest European port operator. The Container
division generated 36% of revenue for 2009.
BLG customer, Tchibo, is the Starbucks of Germany. BLG runs three contract logistics warehouses in Bremen
for Tchibo and has other operations throughout Europe. Other contract logistics customers include: Mercedes,
Siemens, and Ikea. U.S. operations started in 2004 to support the Mercedes assembly plant in Tuscaloosa, AL.
The Contract division was 28% of revenue for 2009.
Provider's Strengths
Automotive logistics.
Provider's Weaknesses
Limited scope.
BEIJING - German company BLG Logistics is actively seeking business opportunities in China as local automakers gear up to sell their cars
in European markets.
"It's a golden opportunity for Chinese automakers to enter the European market as the global financial crisis last year impacted Western
country residents seriously, especially their car-buying budgets," said Manfred Kuhr, vice-chairman of BLG's executive board.
"European consumers began to shift their focus from premium branded luxury cars to less expensive, compact cars, a segment Chinese
branded cars remain competitive in, in terms of pricing."
According to Detthold Aden, the company's president and CEO, last year, the majority of the 1 million vehicles sold in Germany were
smaller-sized economy cars from Japanese and South Korean companies.
BLG is actively contacting automakers including Great Wall, Chang'an, BYD and Huatai to provide logistics services in European markets.
BLG has already helped Chery transport thousands of cars from China to Russia, offloading at Bremerhaven harbor, where BLG's
headquarters is located in northern Germany.
The 133-year-old company also helped BMW's Chinese joint venture partner, Brilliance, to be the first Chinese company to sell cars in
Western European countries. However, fierce competition and Brilliance's Luxembourg-based dealership's shortage of capital, forced the
Chinese automaker to quit the market recently.
"It's pity for Brilliance, which failed in the first phase of entering mature Western markets," said Aden. "But we are pleased to see that the
company has shifted their direction to conquer eastern European countries now."
Aden said it will be better for ambitious Chinese automakers to enter Eastern European countries first before trying to gain a foothold in
Western Europe's highly competitive and saturated markets.
According to BLG, in 2019, vehicle sales in Western Europe are expected to grow by 35 percent over 2009, while Eastern Europe markets
will surge 170 percent.
Chinese auto brands Chery, Great Wall and Geely, now have a small share of the Russian and Ukrainian markets.
"As Chinese carmakers now focus on Russia and Ukraine, BLG has also made a huge investment to expand its logistics network into Eastern
Europe," said Kuhr.
Michael Buenning, managing director of BLG Logistics Shipping, suggested Chinese automakers first establish complete knock down (CKD)
assembly plants overseas and consider setting up manufacturing facilities there when sales top 100,000 units.
"We are now discussing with China's Geely Auto, which acquired Sweden's luxury brand Volvo earlier this year, to help the company
establish an integrated logistics center in Ningbo, to collect and package its CKD parts sourced across the country and then transport them to its
assembly plants in Eastern Europe and Africa," Buenning told China Daily.
Currently, BLG is assisting Daimler AG transport vehicle parts from its suppliers in Spain to the German automaker's plant in Fuzhou to
produce light commercial vehicles such as the Vito and Viano models.
Last year, BLG transported over 3 million vehicles around the world, yet only 8,000 units originated in China. Shenzhen-based BYD said last
week that it will set up its Europe headquarters in Germany soon, in preparation for sales of E6 electric cars there next year.
BLG LOGISTICS: overcoming the crisis with a dual strategy
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BLG CEO Detthold Aden was not able to announce the usual annual record result for the 2009 financial year at the BLG LOGISTICS
GROUP balance sheet press conference in Bremen on 4 May. The global crisis particularly affected the seaports, and this is clearly reflected in
BLGs results. Sales turnover declined by 15 percent to 818.5 million Euros, and pre-tax earnings decreased by 80 percent to 16.5 million Euros.
At the general meeting on 3 June, the executive board and supervisory board will suggest using the joint stock corporations 2009 net
earnings, totaling 960,000 Euros, to distribute a dividend of 25 cents per share.
All permanent positions secured for 2009 and 2010
Closing off 2009 in the black was, according to Aden, a show of strength which could not be achieved through savings measures and strict
cost management alone. It also required concessions to be made at a staff level. However, BLG was able to secure all permanent positions,
although the staffing agent GHBV had to cut jobs at the seaports. With its holdings, the BLG corporate group currently provides around 14,500
jobs worldwide. The crisis meant this was 1,300 less than in 2008. The GHBV was particularly affected by this reduction. Shortened work hours
are, however, also being implemented at some BLG companies.
On the other hand, the new dual strategy, concerning savings potentials and market-oriented development opportunities, produced positive
effects for the 2009 result. According to Aden, we save wherever it is economically wise to do so. This means we have also adapted our
investments to the lower demand resulting from the crisis. Conversely, we have also started a market offensive, and are simultaneously investing
in sustainable markets. In doing so, Eastern Europe is presently an area of focus, particularly automobile logistics.
New opportunities in offshore energy and trade logistics
The market offensive involves securing existing deals and acquiring new ones. In addition to this come new fields of business. Aden cited the
booming offshore wind energy as an example of this, stating that the industry must change their manufacturing structures into industrial series
production in order to reduce the costs, which are currently too high. He added that low-cost processes can only be formed with intelligent
logistics. We are the first logisticians who are able to offer these services with the necessary degree of complexity.
The company also sees opportunities for growth in the area of trade logistics, where BLG did not feel the effects of the crisis due to the
stable domestic demand. New customers are expected to be acquired here. Negotiations are being conducted with existing customers regarding
the expansion of services. This should see business volume double in the mid-term. Trade logistic is part of the Contract division, with which
BLG achieved a sales turnover of 231 million Euros in 2009, 45 million less than in 2008. It saw the pre-tax earnings decline from 8.8 million to
two million Euros.
Automobile logistics Investments in Eastern Europe
In the Automobile division, a total of 4.7 million vehicles were handled in the terminal, transport and technical network in 2009 one
million less than the previous year. The companys position as Europes leading automobile logistics provider was never in danger, because its
competitors were also suffering from the crisis. The sea terminals in Bremerhaven and Gioia Tauro were badly affected, posting a more than 40
percent decline turnover. On the other hand, BLG AutoRail started well. In 2009, BLG transported around 100,000 vehicles by rail, and is this
year expecting this figure to double.
BLG particularly sees new opportunities for automobile logistics in Eastern Europe. It is currently already present in Russia, Poland, the
Ukraine, the Czech Republic, Slovakia and Slovenia. Other deals are said to follow. The Automobile division achieved a total sales turnover of
298 million Euros in 2009 37 million less than in 2008. In doing so, the pre-tax earnings declined from 22.7 million to 4.2 million Euros.
EUROGATE continues to be a market leader in Europe
The Container division is managed by the joint venture EUROGATE. A total of 12.5 million TEU were handled at the ten container
terminals in 2009 12.3 percent less than the previous year. As the competitors were also affected by the crisis, EUROGATE was able to claim
its position as Europes leading terminal operator. The sales revenue decreased by 17.3 percent to 591 million Euros, and the pre-tax earnings
dropped by 80.4 million to 48 million Euros.
The need to adapt the shipping channels in the Elbe and Weser to the demands of the large container ships was re-iterated so as not to lose
competitiveness to the western ports. The Russian container terminal in Ust Luga, where EUROGATE has a 20-percent holding, will not be
started up until at least the end of this year, instead of last year as originally planned, due to the crisis. The delay means the investments are
stretched out, and financing has a solid basis if the capacities are actually used.
The situation at the JadeWeserPort in Wilhelmshaven is very different. There, the JadeWeserPort Realisierungsgesellschaft, with partners
Lower Saxony and Bremen, wants to complete the terminal in November 2011. EUROGATE and the partners in the operating company, APM
Terminals and the National Container Company, are clearly standing by Wilhelmshaven, but expect a later start-up. An amicable solution is
being sought with all participants in confidential talks.
Turnover growth in the first quarter of 2010
Based on turnover figures, the first quarter of 2010 appears to be much friendlier than 2009. Car exports in Bremerhaven are virtually
booming. On the other hand, imports are still below the previous years level. The difference between imports and exports is negative for the
vehicle port of Bremerhaven. Furthermore, there are hardly any technical services on the export vehicles, and therefore no additional value
added.
Container turnover in the first quarter recorded a two-digit increase compared to the same time period last year. According to Aden,
however, there is nothing to say for certain whether this will be a long-lasting recovery or not. Reliable market indicators are a rare thing. The
economic research institutes predict a slight growth of 1.5 percent this year. At this rate, we would need several years to reach the level of 2008
again. But we expect our pre-tax earnings for 2010 to at least be slightly above those from 2009. We do not expect a long-term recovery until
2011.
Internationalization secures profitability and creates jobs
The successful business development and sustained growth experienced within the BLG LOGISTICS GROUP demand an ambitious
program of investment. CEO of BLG Detthold Aden, at the press conference to present the annual financial statement on 16th May in Bremen,
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said, Mid-term investment to 2011 amounts to 900 million Euro. The largest part, 740 million Euro, is made in relation to the container
division. Some 72 million Euro is planned for the automobile division with 80 million Euro destined for the contract division.
Aden continued, 2006 once again was a good year for results. Our net revenue amounted to 760 million Euro in comparison to the previous
years 702 million Euro. Pre-tax profits increased by 10 percent to 55 million Euro. These positive developments are evident in all three business
divisions. In the automobile division, BLG recorded a total volume of 4.5 million vehicles (previous year: 4.1 million). Its position as the
European market-leader was therefore further enhanced. The contract division doubled the number of parts moved or processed to 130 million
picks. The EUROGATE 2006 joint venture achieved a total volume of 12.5 million TEU (previous year: 12.1 million TEU) and so BLGs
position as market-leader in Europe has been confirmed in this business division too.
The Bremen-based Company Group is using this growth to continually create new jobs. Taking the major corporate participations and the
labor pools in the ports into account, the Group currently employs some 12,000 people worldwide, around 1000 more than in 2005. The
majority of new jobs are found in the container and automobile terminal as well as the logistics centres.
In the automobile division, Bremerhaven was the terminal that exhibited the highest growth in 2006 with some 1.85 million vehicles (a rise of
15.5%), leaving its competitors in northwest Europe far behind in its wake. Positive developments of this type were even more clearly seen in
the Technical Centre, where some 415,000 vehicles were processed (previous year: 340,000 vehicles). One new customer to Bremerhaven is
HSO importing Chinese vehicles of the Brilliance make. The initial large volume arrived mid-March. A further 1000 vehicles are scheduled for
June.
BLG constructed new parking spaces and an additional parking deck for 6500 vehicles at the Osthafen. New developments also saw the
construction of a new rail loading facility and a second bridge between the Osthafen and the rearward parking spaces. The waterside expansion
of the Osthafen has been largely completed in the meantime. Four new shipping berths and further parking spaces are to be ready by the
summer.
According to Aden, the growth within the contract division is driven by particularly dynamic developments in existing and new business. As
part of the business relationship with our existing customer, Tchibo, BLG took possession in mid-2006 of the third expansion phase of Europe
s largest high-bay warehouse in Europe. This complex enables BLG to supply the Tchibo branch network and independent trade with consumer
products. The addition of the third block sees the capacity of the warehouse increase to 200,000 pallet slots. At the end of 2006 moreover, a new
low-level warehousing facility with 60,000 square meters of warehousing space was put into operation at the Freight Traffic and Logistics Centre
also to cater for the Tchibo business.
At the beginning of this year, BLG assumed the automotive parts logistics for FIAT commercial vehicles in the Atessa plant in Italy. BLG
employs some 400 workers at this site. In Brazil, the BBS joint venture began performing automotive parts logistics for VW. VW produces 50
different goods vehicle and bus models at this location. This too involves some 400 jobs.
In Zilina, BLG has been active since November 2006 with its French partner CAT at the new plant of KIA MOTORS SLOVAKIA. There
the ALS joint venture operates the Vehicle Processing Center including quality control and yard operation together with the organization of
outgoing transports to the European national markets.
The container division is being developed through the EUROGATE joint venture. As Aden said, In 2006, Bremerhaven was the shooting
star of the terminal network. A solid growth rate of 19 percent was recorded. This has seen us reach over 4.45 million TEU. We are fortunate in
that the CT 4 expansion phase was planned in good time with adequate dimensions meaning that we do not have to worry about any shortages
in capacity in Bremerhaven over the medium term. The first berth has been operational since October 2006. Bremenports, the port operator,
has been able to accelerate the construction of CT 4 ensuring that it will be fully operationally-ready as early as Spring 2008, something originally
planned for January 2009.
Aden regards the JadeWeserPort as the optimal addition for long-term development post-2010. It is therefore extremely important that
EUROGATE last year was awarded the operators license for Wilhelmshaven. EUROGATE is the only terminal operator on the northwest
coast with a total of 10 new berths to accommodate large shipping - two of these are located in Hamburg with Bremerhaven and Wilhelmshaven
each having four. In view of the limited terminal capacity, this represents a significant competitive advantage.
Given the current developments in ship sizes, Aden is pressing for the updating of the navigating channels in the Auenweser and Unterelbe.
He considers depths of 15.5 meters below chart datum to be urgently required in order to allow large shipping to enter and leave the terminal
independently of the tides, at least as far as this is practically feasible. Aden said, The planning approval procedure has been set in motion. We
are hoping to have official planning approval as soon as possible.
Regarding the current progress recorded for the 2007 business year, the BLG CEO spoke of developments being within plan with respect to
the volume as well as the revenues and results, ensuring that BLG will again be able to present a positive balance sheet next year. Particularly
strong growth is apparent within the container terminal and automobile business. He reports that Bremerhaven, for example, will again be
recording double-digit rates of growth in the container and automobile handling divisions.
In conclusion, Aden stated his position regarding the common maritime policy of the European Union. At the EU Conference in Bremen at
the beginning of May, he primarily welcomed a common EU maritime policy on behalf of the Central Association of German Port Operators.
As a joint integrated strategy, he felt it needed to contribute to the promotion of growth and employment and, at the same time, to protect the
environment for the sake of the economic and ecological importance of the sea. Aden said, Approximately 300,000 jobs are dependent on
our ports, either directly or indirectly. The maritime ports make a significant contribution to the strengthening of the employment, income and
tax revenue throughout Germany.
The maritime transport forecast commissioned by the Federal Ministry of Transport predicts continued growth until 2025. These figures
indicate that container volumes will increase by about three-fold. For both of Germanys container ports this means that instead of 13.4 million
TEU as recorded last year, in 2025 there will be over 36 million TEU. As Aden said, This growth demands that the terminals, the maritime
access routes and the hinterland connections be expanded. This is the only way to secure the opportunities for growth and employment.
The German port industry will invest a total of 3.2 billion Euro in the expansion of terminals by 2012. The maritime States, moreover, will
invest some 4.3 billion Euro in improvements to port infrastructure with the Federal Government contributing 5.1 billion Euro to the expansion
of maritime access routes and hinterland connections. The port industry, maritime States and the Federal Government will, by 2012, be investing
a total of 12.6 billion Euro.
Taking advantage of the horizon
With two European hubs, an expanding network and a comprehensive logistics offering that completes the supply chain, BLG Logistics is in a
strong position to exploit emerging markets in the East.
The distance to the Port of Bremerhaven from the city of Bremen is a quick 50 kilometers, reachable in about 35 minutes without traffic,
though this depends on your vehicle's ability to take advantage of the free-moving German autobahns. The Mercedes that carried me on the way
there beat my ride back in a Smart by about 15 minutes. In either direction from the port you will notice truck carriers loaded with cars of all
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brands as they emerge through North Sea fog. These cars make up a fraction of the roughly 1.85 million vehicles handled in Bremerhaven in
2006, and their transport along the A27 is just one brief moment in a supply chain and network controlled by BLG Logistics Automobile.
The Bremerhaven port has been operated by BLG Logistics Group since the 1960s, and today the group handles nearly four million TEU of
container cargo here. Across 17 terminals, truck bases and forwarding agencies in Europe, BLG handled 4.1 million vehicles (1.6 million at
Bremerhaven) and 12.1 million TEU in 2005. Bremerhaven is among the largest container ports in the world, and the largest for the
transhipment of vehicles in Europe. BLG Logistics Automobile is the business unit of the group that specializes specifically in finished vehicles.
Restructuring and acquisition
There is much on the horizon for this growing logistics provider. As market expansions in the Far East, Eastern Europe and Russia increase
volume and demand, pushing port capacity to its limits, BLG Logistics Automobile is responding with developments in its two European hubs:
Bremerhaven and Gioia Tauro in Italy. It is negotiating and researching new ports and centres across Eastern Europe and Russia. Also, BLG has
moved into outbound logistics in a 50-50 joint venture with Groupe CAT for the new Kia factory in Zilina, Slovakia. And for 2007, BLG
Logistics Automobile has begun to handle and distribute imports from the BMW partner, Brilliance China Auto.
BLG Logistics group underwent a restructuring in 1998 and the result divided labor in the company between three big business units. BLG
Logistics Contract handles automotive parts, business electronics, consumer products and other cargo. BLG Logistics Container handles the
container cargo, providing transport, depots and maintenance.
The Automobile unit employs 2000 people, and had a turnover of 244m (US$323.4m) in 2005. After the restructuring, the company wanted
to develop from a pure port operator to a diversified automobile logistics provider. The first step toward achieving this, says Wolfgang Stver,
Director Sales, BLG Logistics Automobile, was to offer forwarding services for export cars. The second step was to offer technical services. To
achieve these ends, the company took a controlling 50 per cent stake in E.H. Harms Automobile Logistics in 2002. It is Harms-branded trucks
that you spot on the A27, and criss-crossing Germany, Austria, Slovenia, Slovakia, Poland and eventually the Ukraine and Russia as well. Besides
trucks, the Harms network offers forwarding by rail and river, with six barges on the Rhine River and one on the Danube. It also operates the
technical centres at Bremerhaven.
Supply chain, start to finish
Taking over Harms allowed BLG Logistics Automobile to do what, according to Stver, hardly any other logistics providers in Europe do:
offer automotive and automobile (finished vehicle) services at the same time in the same group.
"What we do here (at Bremerhaven] is the first step," says Stver. "We discharge the car from the ship, then we have the 50-50 joint venture
with the technical treatment. After that it is 100 per cent Harms doing the transport. So there you have the whole chain, from vessel port arrival
to dealer inland."
The primary customers at Bremerhaven are DaimlerChrysler and BMW on the export side; on the import side it's the Koreans: Hyundai and
Kia. Stver stresses the importance on both the import as well as export handling at the port. "The strength of Bremerhaven is to combine
export and import cargo," he says. "This means that the carrier brings in import cargo and finds export cargo to load back. You find the high
frequency of feeder carriers for the onward transhipment for Scandinavia and Eastern Europe."
A new area for the company is outbound factory logistics. In 2006, Glovis, the logistics provider for Hyundai Motor Group, selected
Automotive Logistics Slovakia (ALS) - a joint venture with Groupe CAT - to handle the outbound logistics for the new Kia factory in Zilina.
ALS will take over the vehicle after production to do technical work. From there, it will organize the delivery compound and do the Europeanwide distribution in 42 countries. For the transport, the division of labor will be regional, with Groupe CAT serving France, Spain and others in
the West, and & BLG delivering across Germany and the East.
Handling growth at Bremerhaven
Bremerhaven is well situated on the open sea, and functions as the main hub port to the Scandinavian market, with good links into Europe
by feeder, rail and road. The port has two technical centres, performing PDI, quality checks, and other manufacturing and technical work as
needed. The volume of vehicles handled at Bremerhaven increased by about 15 per cent from 2005 to 2006. The increasing volumes going to
Russia drove much of this unexpected growth.
"We are preparing ourselves to handle a volume of two million cars per year within the next three to five years," says Stver. "So were
responding with expansion; storage space as well as berths."
Several projects have been completed or are underway. The main project has been to fill up part of the port basin so as to gain one new berth
for deep-sea vessels and three additional feeder berths. This construction is scheduled for completion by June 2007, by which time the port will
have 10 berths for deep-sea, and eight for short-sea.
At present, the 1,300 or so vessels that enter the terminal each year must pass through the bottleneck of Nordschleuse lock. However,
construction, commissioned by the Bremen Senator of Economic Affairs, has already begun on expanding the length and width of the aging
Kaiserschleuse lock to become the port's second entrance.
"This is one of the big steps we have made this year," says Bernd Kupke, Managing Director, BLG Logistics Automobile. "This is also for
the future of Bremerhaven. We will be the only port with two locks for automobile handling."
Covering up
The company has also completed a car park with covered space for 6,600 units. This is connected by a new bridge to the transhipment area.
The facility will be used exclusively by BMW. It was built in response to demand for a covered and closed transport chain. Wrapping cars in
plastic and protective coverage is expensive, and also produces waste, and the closed transport chain is a way that companies are trying to cut
down on costs and environmental impact.
"The premium manufacturers in Germany are developing closed supply chains," says Stver. "DaimIerChrysler has invented a new type of
railcar together with German Rail, called Tube. It's a covered railcar system and BMW is developing a similar philosophy. And the vehicle
manufacturer demanded that the cars be stored under cover in the port."
Stver says that, despite the port's age, it has definite space advantages and there is still room for growth. "We want to expand the facilities
according to the needs of our customers," he says, but adds that one must consider the distance involved in driving a car from the unloading
station to the storage yard, and from the storage yard to the shipping. "It makes little sense," he says, "to develop ground space that lengthens
this distance."
Another development at the port is the construction of yet a third technical centre, which will be orientated for export. It can also be used
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for overflows on the import side, but as BLG Logistics Automobile increases its outbound service, Stver says the demands for specialized
technical work for outbound vehicles is now needed.
Second hub develops
The past decade has seen enormous growth in Eastern Europe, most recently in Russia, but the company needs to make adjustments to
realize the full potential of this growth. That was one reason why BLG Logistics Automobile developed a second European hub in the
Mediterranean at Gioia Tauro, Italy. BLG Logistics Automobile Italia is a joint venture with ContShip Italia.
By furnishing a second hub that might better serve the Mediterranean and Eastern Europe, BLG aims to increase efficiency in the
transhipment industry by reducing the ports of call.
"Reducing the ports of call is one of the big challenges for carriers," says Kupke. "There are a lot of individual contracts between the carriers
and the various OEMs, with different ports of entry for the European market. This is an even bigger problem in the Mediterranean than in
northern Europe. These vessels are losing time if they have to call at a port for minor shipment."
With growth around 34 percent in Eastern Europe between 2003-2006, capacity issues in ports and poor network infrastructures have led to
the need for carriers to make five or six stops. BLG intends for Gioia Tauro, with deep-sea links as well as feeder links to the Black Sea, France,
Spain, North Africa and the Middle East, to allow carriers a short stopover in Italy to serve these regions, before moving on to Bremerhaven.
"Gioia Tauro is one of the few areas in the Mediterranean area where there is really the chance to expand the storage space and also to add
extra-value services," says Kupke. "All the other ports there are small." The port does not offer as much space or technical services as
Bremerhaven, but construction of another feeder berth is underway, and Stver says that the port has developed quickly into a hub.
The road to Russia
Another advantage of Gioia Tauro is that it can offer an alternate route to Russia via the Black Sea. At present Bremerhaven handles almost
200,000 cars bound for Russia, but almost all go via Finnish ports. As the Russian market expands, there are concerns about whether the
Finnish ports will be able to cope, though at present there is little space in the Baltic ports. BLG envisions Gioia Tauro as a possible route to
Russia through the Black Sea to Illichevsk, a port in Ukraine. Vessels can reach Illichevsk from Gioia Tauro in four days. From there it is one
day by truck to Kiev, where BLG is negotiating with a possible partner to develop an internal terminal. But the distance from Illichevsk to
Moscow is long: four days by truck, and there is a lack of railway infrastructure.
The Russian border remains a problem via Ukraine, as it is already in Finland, according to Frank Mller, Senior Project Manager, Business
Development, BLG Logistics Automobile, who is leading the company's research into Russia. Besides long delays in clearing customs, the
Russians require drivers to have a special license to cross the border.
The company is forced to pay those with the license to cross the border for them, but these operators are often disloyal to contracts,
according to Mller, and may demand increases day to day. A better alternative is to establish a port in Russia, and to perform customs clearance
there or further inland.
Mller has been researching the possibilities in the Baltic. Of five possible ports he's reviewed, four have what Mller terms "killing factors,"
or negatives that outweigh the potential benefit of the project. The first, at Sillam in Estonia, also faces the problems of the border. According
to Mller, Estonia has an only slight advantage over Finland, because of cheaper labor. However, this advantage will equalize within the next five
to 10 years, he believes.
A second port is in Russia, Ust-Luga, but this is what Mller terms a "paper project," with few definite plans and little or no practical
progress in development. He says the operating company has been making promises to open an auto terminal for a decade. In January, Ust-Luga
told AL that it would be ready for operation in July this year, with an initial annual capacity of about 100,000 vehicles. But Mller says that the
presence of a coal terminal on the site kills the project for BLG - there are fears it could cause contamination.
According to Alexander Goloviznin, Deputy General Manager, JSC Ust-Luga Company, the coal terminal is almost two kilometers from the
car terminal, and the wind blows in the direction of the coal site. "We have no doubts," he says. "And the ship-owners, companies and other
board members who have studied the site have no doubts either."
But Mller is not convinced. "If you have a coal terminal, this means dirt, pollution and contamination," he says. "It doesn't matter from
which side the wind blows. Even if people say they will wash the car, all the open parts will be contaminated. The first person who switches on
the air conditioning will not just smell coal, but will have a dirty interior."
The third port is Lomonosov, part of the greater St. Petersburg area. Mller defined this as a sleeping port because it used to be a navy port
and its status has not been changed to commercial status. This could change, though Mller is not hopeful for the short term. Mller believes
that he has discovered a viable option in St. Petersburg itself. The Oslo Marine Group is developing a terminal that would specialize in ro-ro
cargo.
Unlike another St. Petersburg port in development by Petrolesport, the Oslo Marine Group option has an extension area available, and is
well situated for road access. It has space for up to six berths and eventually a 46,000-square meter storage area.
Mller says the company is negotiating for a joint venture with AT-Avtovo. "This would be the first terminal specializing in finished vehicles
in Russia," he says.
BLG Logistics wants to carry out the distribution inland as well, and to do the technical work; in other words, the company wants to
organize a hub for the Russian region, offering a comprehensive logistics service.
Stver points out that with Ford and GM to open factories near St. Petersburg in 2008, and Nissan and Toyota in 2009, this is clearly set to
be the production zone in Russia for the time being. And, he says, with production figures projected up to 300,000 cars a year, these
manufacturers will be exporting as well. BLG wants to have the facilities ready to handle this flow.
Many challenges remain, such as rail and infrastructure, and these projects depend on the Russian government. "But St. Petersburg and
Moscow will become a mainstream project," says Stver. "If we don't do it, somebody will."
Chinese opportunities
Though some forecasts predict that, within 10 years, 50 per cent of all world car production will be in China, BLG is not quite ready to
venture deep into the territory.
"We have not made up our minds about going into China," says Stver. "BLG Logistics Container does container deliveries of parts from
Germany to the new Mercedes factory in Beijing. But for BLG Logistics Automobile, I think it's more important that if the Chinese OEMs start
to export to Europe, we are the port of entry, at least for Germany. That's our major target."
It has been more common for German manufacturers to ship their premium cars in containers, but carriers, such as Eukor, now offer a
direct, ro-ro service to China from Bremerhaven. Porsche and Audi have both switched from container to ro-ro.
18th Edition
When the ro-ro carriers go into Chinese ports, they will now pick up Brilliance cars for export, part of BLG Logistics Automobile's first
finished vehicle contract with a Chinese OEM. Brilliance started importing cars to Germany in January. The early targets are fairly small - 5,000
cars for 2007.
In December 2006, Brilliance announced that it would distribute 158,000 cars to Europe over the next five years. Stver compares the
German numbers to initial Japanese and Korean ventures into the German market. Both began slowly and now have a solid market share in the
country.
There have also been talks with Chery and Landwind, but thus far Stver feels they are not concrete enough in their plans. Brilliance, he says,
appears better prepared for the difficulties of the German market. He also expects Brilliance to make a contract with Russia, and logistics will
then be decided via Bremerhaven or Gioia Tauro.
However, a higher volume of Chinese imports still presents a challenge, though Stver feels confident that the facilities at Bremerhaven will
be ready. "I think Germany is one of the most difficult car markets," he says. "It's been said that if you can make it here, you can make it
anywhere. The Japanese did it 30 years ago, the Koreans 15, so why not the Chinese? Still, we have to be careful."
Parking Deck for 6,600 Vehicles Inagurated
Michael Bomann, head of vehicle distribution logistics of the BMW Group, and Bernd Kupke, Managing Director of BLG LOGISTICS
AUTOMOBILE, jointly cut the symbolic ribbon and thus officially opened operation of the new parking deck at the Auto Terminal
Bremerhaven.
Construction work on the 248-meter-long and 103-meter-wide facility lasted just under a year. On six levels it provides covered space for
6,600 vehicles until they are loaded onto the large car carriers. The new parking deck will be used exclusively for export vehicles of the BMW
Group.
In addition, a double-level unloading station was built with 4 sets of tracks, each having a length of 700 m. The electric vertical adjustment of
the ramps enables optimal docking of the automobile trains. The investment volume totaled around 18 million euros.
Covered, weather-protected storage of the high-quality new vehicles until departure of the vessel, along with transport in closed railway cars,
is an essential element of the BMW Group strategy involving shipment of new vehicles from the plant without outer skin protection in future.
BMW relies on Bremerhaven both for exports to North America and Asia and for imports of Z4 and X5 models produced in the USA.
According to expectations, a total of 370,000 vehicles of the BMW brand will be handled via the BLG Auto Terminal this year. This means the
BMW Group is one of the key clients in Bremerhaven.
The total cargo handling volume of the Auto Terminal will increase to around 1.8 million vehicles by the end of the year, corresponding to a
two-digit growth rate as compared to 2005.
New Contracts With Shipping Company and manufacturer Customers
BLG LOGISTICS recently signed new contracts with Norwegian automobile shipping company Hegh Autoliners and car manufacturer
Mazda.
Hegh Autoliners loads and discharges around 100,000 vehicles a year at the Bremerhaven Auto Terminal. The shipping company serves all
routes around the globe. In Bremerhaven its customers include DaimlerChrysler and BMW. Through Hegh Autoliners Germany GMBH the
shipping company has its German headquarters in Bremen. The new contract runs until the end of 2008.
The second new contract applies to Mazda. The Bremerhaven Auto Terminal has already been working as a hub for the car manufacturer
for the Scandinavia and Baltic routes for two years now. The vehicles coming from Japan and England were stored temporarily in Bremerhaven
and transported further via feeder vessels.
An additional contract for vehicles to Russia has now been concluded with Mazda Logistics Europe in Brussels. The scope of the contract
also encompasses technical services on around 30,000 vehicles a year. Prior to further shipment the vehicles undergo pre-delivery inspection
(PDI) and other technical work at the technical center of the Auto Terminal. Bremerhaven has already been performing these services for
Mazda vehicles to Denmark, Sweden and Norway for two years.
In 2005 340,000 vehicles were processed at the Bremerhaven technical center, the largest automobile workshop in Europe. Over 400,000
vehicles are expected for 2006.
Automotive drives strong BLG results
German logistics group BLG reported that sales in 2005 rose by 10.3 percent to 701.7 million and earnings before taxes (EBT) increased by
63 percent to 49.7 million. The positive development was achieved through growth in existing business and also by virtue of new commitments
at home and abroad.
BLGs Contract Division recorded 6.2 percent growth to a sales level of 192.9 million in 2005. The EBT increased by 1.2 million to 6.9
million. Besides activities in automotive parts, industrial and trade logistics, BLG also concentrated on conventional seaport logistics as well as
cold store and deep-freeze logistics.
BLGs joint network with E.H. Harms Automobile Logistics, handled a total of 4.1 million vehicles (previous year: 3.8 million). The
strongest location in the network is Bremerhaven. Over 1.6 million vehicles were handled there in 2005 (+14%). In addition, 340,000 vehicles
were processed at the Bremerhaven technical centre. The sales in the AUTOMOBILE Division rose by 12.6 percent to 253.2 million and the
EBT from 253.2 million and the EBT from 8.8 million to 14.1.
18th Edition
(562) 739-1300
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
South America
Local Courier
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Eduardo Soler
CEO
Rodrigo Dourojeanni
Ignacio Cueto
Commercial Mgr.
President
57
57 **
Exchange:
650
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
0.1
Total Other:
Total Trailers:
Total Aircraft:
1
40
Total Ocean:
360
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Almacenes Pars
General Merchandisers
Chile
Avon
Chile
Beiersdorf
Chile
Beverages
Chile
Colgate-Palmolive
Chile
Cristian Lay
Chile
DIRECTV
Telecommunications
Chile
Petroleum Refining
Chile
Entel
Telecommunications
Chile
Falabella
General Merchandisers
Chile
Ingram Micro
Chile
Kimberly-Clark
Chile
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Blue Express
Latin/South America
Chile
EDITOR'S COMMENTS
Blue Express International S.A., formerly LAN Courier S.A., provides express delivery and some forwarding
services in Chile.
Provider's Strengths
Distribution throughout Chile.
Provider's Weaknesses
18th Edition
(52) 72 22 49 20 04
COMPANY BACKGROUND
Parent Corporation:
Bomi Group
Asset Focus:
Market Area:
Founding Business:
International
Healthcare-based Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Victor Raul Martinez
CEO
Humberto Burguete
Daniel Novelo
Ruth Tejeda
CFO
12
Ticker Symbol
12 **
Exchange:
130
13
3
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
40
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.194
1
30
Total Tankers:
Total Other:
MAJOR MARKETS
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Cordis
Pharmaceuticals
Mexico
Ethicon Endo-Surgery
Pharmaceuticals
Mexico
LifeScan, Inc.
Pharmaceuticals
Mexico
Ortho-Clinical Diagnostics
Pharmaceuticals
Mexico
Roche Diagnostics
Pharmaceuticals
Mexico
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
India
Bomi
Europe
North America
Latin/South America
Italy
Mexico
Argentina
Brazil
Chile
Colombia
Venezuela
Portugal
Slovakia
Spain
Turkey
EDITOR'S COMMENTS
Major capabilities are in inventory management, temperature-controlled storage, and freight brokerage for
pharmaceutical, medical equipment, medical diagnostic and other healthcare related companies. Bomi recently
opened up operations in India (New Delhi).
Provider's Strengths
Healthcare logisics.
Provider's Weaknesses
One vertical provider.
The distribution in hospitals of half of the instruments for medical emergency care in Mxico City, depend on Bomi, a logistics company
focused on the medical hospital sector, unique in the world. The task is titanic, as they handle more than 32 thousand products of 15
multinational companies to satisfy 1,800 sale points in the Mexican Republic, half of which are concentrated in the DF.
18th Edition
86 592 2112133
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
China
Warehousing
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Lili Zhou
CEO
Jacky Wang
Marketing Mgr.
Zhou Wei
Mark Wen
CFO
CIO
375
375 **
Exchange:
490
300
3-5
SHA
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
40
Total Trucks:
116
Total Trucks:
116
Total Other:
32
Total Trailers:
Total Aircraft:
40
Total Ocean:
Total Other:
4.3
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): SEALINK
Transportation Planning and Optimization:
Warehouse Management System (WMS):
SEALINK, FLUX
18th Edition
SEALINK
SNERP
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Castel
Beverages
Xiamen
Dell
Xiamen
Prima
Xiamen
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Xiamen
Asia/Pacific
Europe
North America
C&D Logistics
Latin/South America
China
EDITOR'S COMMENTS
C&D Logistics is a major VAWD 3PL of wine imports in Xiamen. Castel is a major customer. Its parent
company Xiamen C&D Inc. generated 2009 revenues of $6 billion and is involved in real estate development,
property leasing and industrial investments in addition to its supply chain operations.
Provider's Strengths
Chinese imports warehousing and distribution.
Provider's Weaknesses
Key Personnel:
Mr. Robin Chen, Manager of Business Management
Mr. Zhang Liling, Warehouse Manager
Founded in 2000 and headquartered in Xiamen, C&D Logistics Group Co., Ltd. has over 500 employees and generated revenues of $375
million in 2009. Its branch offices are located in Fuzhou, Hangzhou, Ningbo, Putian, Qingdao, Quanzhou, Shanghai, Shenzhen, Tianjin and
Zhangzhou.
C&D Logistics parent company Xiamen C&D Inc. generated 2009 revenues of $6 billion and is involved in real estate development,
property leasing and industrial investments in addition to its supply chain operations. It has the capital to financially support importing
customers by prepaying for imports before collecting funds from importers. This financial capability has helped C&D Logistics (C&D) in
growing its domestic warehousing and distribution business.
C&Ds market focus is on SMEs (small and medium sized enterprises). In Xiamen, C&D is one of the largest third-party logistics providers
(3PLs) servicing the wine industry. About seven million bottles of wine are imported into Xiamen annually. According to C&D, the Xiamen
branch alone processes around three million bottles of wine annually or around 40% of the total annual wine imports. C&D handles over 200
brands and over 1,000 different types of wine imported from 16 countries. Castel is a major customer. C&D manages a 17,000 square meter
warehouse for Castel, which is temperature controlled at 18C to 22C. In this warehouse, C&D provides a total packaging service to Castel
which includes printing the International Standard Wine Number on each bottle. Less-than-truckload transportation is utilized for outbound
distribution of the wine from the Xiamen warehouse.
C&D is also one of the largest 3PLs handling electronic devices in Fujian. It is a lead logistics provider for electronics manufacturer Prima
headquartered in Xiamen. It also manages a warehouse for Dell in Xiamen.
With a strong base of warehousing operations in Xiamen, C&D has also been expanding in the Eastern China and Northern China markets.
In Shanghai, it manages a 5,000 square meter warehouse in the Shanghai Waigaoqiao Free Trade Zone to handle imports destined to Eastern
China including Zhejiang and Jiangsu. Also, it has plans to startup a 100,000 square meter warehouse in the Fengxian District of Shanghai, near
the Shanghai Yangshan Port, by the end of 2010.
In Qingdao, C&Ds 7,000 square meter warehouse handles imported rubber products for a major customer from the Qingdao Port. It also
has plans to manage a 160,000 square meter warehouse in the Tianjin Free Trade Zone.
C&Ds strength is in domestic warehousing and distribution. It is especially good at handling imports from port terminals to its warehouses
and then managing the respective outbound transportation. With its local knowledge and its parent companys strong financial backing, C&D
Logistics has continued to develop business and build long-term customer relationships.
18th Edition
952-683-3768
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1905
Asset Focus:
Market Area:
Founding Business:
Global
Broker
OVERALL CAPABILITY
Overall Capability of Provider:
High quality logistics manager expanding globally and operating in most major markets; procures and markets fresh prod
KEY PERSONNEL
John Wiehoff
Angela Freeman
Chris O'Brien
7,577
1,382 **
Exchange:
7,347
>1
NASDAQ
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Infor SCM
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3M
Miscellaneous
N. America
Amalgamated Sugar
Food Production
N. America
Amazon.com
US
Amstar Corporation
Chemicals
Packaging, Containers
Anheuser-Busch
Beverages
Entertainment
Arcata Graphics
Publishing, Printing
ArcelorMittal
Metals
Europe
Arjo Wiggins
Europe
Aunt Jane's
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
US
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Eqypt
Isreal
Cambodia
New Zealand
Belarus
Mexico
China
Belgium
United States
Hong Kong
Bulgaria
Argentina
Bolivia
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Jamaica
Nicaragua
Panama
Paraguay
Puerto Rico
Uruguay
Venezuela
Jordan
Kuwait
Australia/New Zealand
C.H. Robinson
Bahrain
Africa/Middle East
Asia/Pacific
Czech Republic
India
Oman
Qatar
Saudi Arabia
Indonesia
South Africa
Malaysia
Syria
Pakistan
Denmark
Finland
Japan
France
Germany
Great Britain
Philippines
Greece
Singapore
Hungary
South Korea
Ireland
Sri Lanka
Italy
Taiwan
Lithuania
Thailand
Luxembourg
Vietnam
Moldova
Netherlands
Norway
Poland
Portugal
Romania
Spain
Sweden
Switzerland
Turkey
Ukraine
EDITOR'S COMMENTS
C.H. Robinson continues to be the most profitable tier-one 3PL; regularly achieving net income margins greater
than 20%. C.H. Robinson continues to refine the excellent business model put in place by the founders. C.H.
Robinson dominates domestic transportation management in North America. While 76% of Robinsons net
revenues are truck transportation related, it has solid domestic intermodal, international air and ocean, food
sourcing, fuel card services and fuel management, and supply chain management. It has also been expanding its
TMC operations which focus on large transportation network management. The TMC is now serving North
America, Europe and South America with plans to expand into Asia in 2011.
Employees are highly incented to take care of customers. C.H. Robinsons Canadian operations developed
quickly and it has become a strong player. European operations have also been successful and profitable. They
are a national fit for Europes atomized owner-operator based companies. Asian operations continue to grow.
Recently, Robinson acquired offices in India and continues to make careful purchases of companies with
specializations and has access to the free cash flow to make more.
C.H. Robinson's IT and business processes are tightly coordinated. Reporting capabilities provide good
operating and profitability control. Ongoing modifications include much stronger and friendlier carrier/capacity
management.
Provider's Strengths
Strong business plan and excellent execution = quality company.
Provider's Weaknesses
Lack of an internally run warehousing network.
Key Personnel:
Chris OBrien, Vice PresidentC.H. Robinson Worldwide
Jordan Kass, Executive DirectorTMC
Chris Brady, General Manager, AmericasTMC
Glenn Koepke, General Manager, EuropeTMC
Jason Chamberlain, General Manager, AmericasTMC
Duff Davidson, Director, Business DevelopmentTMC
Jim De Vries, Director, Operational ExcellenceTMC
C.H. Robinson Worldwide Overview
18th Edition
Founded in 1905, C.H. Robinson Worldwide has grown to be a top ten global third-party logistics provider (3PL) with 2009 gross revenue of
$7.6 billion and net revenue of $1.4 billion. Its staff of 7,300 manages a network of 235 company owned offices in 22 countries. Its non-asset
based transportation management centric operations managed over 7.5 million shipments in 2009 including over 250,000 ocean containers
through its growing freight forwarding operations. C.H. Robinson Worldwide (CHRW) has established contracts with over 47,000
transportation providers and has long-term contracts with over 14,500 customers.
With such a large network and service portfolio, C.H. Robinson Worldwide has multiple transportation management service lines. One
option for customers with complex transportation networks is to use CHRWs TMC operating division. The TMC managed TMS
(transportation management system) approach has been one of the cornerstones to CHRWs expanding domestic and global operations. It takes
a flexible/collaborative approach with customers who often maintain a significant number of contracts directly with transportation providers
and rely on TMC operations and IT to optimize daily transportation management functions and for ongoing process improvement.
CHRWs TMC operations have played a significant role in its expanding global operations and have significant market momentum, growing
at over 20% per year. Since its services tend to be fairly unique to CHRW, we will focus on the TMC in the sections below.
TMC Overview, Strategy and Service Offering
As an independent internal division of C.H. Robinson Worldwide, the TMC processed over two million shipments in 2009 and had over $1
billion in freight under management (FUM). It manages customer transportation networks in North America, Europe, and South America and is
looking to launch operations in Asia mid 2011 and expand over the next five years. The TMCs staff of 150 employees is primarily domiciled at
its Chicago, Illinois headquarters. Six are based at its Amsterdam, Netherlands TMC operation which opened in 2008. Managing large
transportation networks requires solid supply chain management systems and the TMC, together with CHRW has an annual information
technology spend in excess of $80 million. The TMC has over 30 customers and its accounts include: Boise, Ocean Spray, Dole Foods, John
Deere, Tetra Pak, Johnson Controls, Haier America and Subway.
TMCs strategy is to focus on working with large shippers with transportation spends in excess of $5 million. Its average customer has a
transportation spend of $50 to $60 million. Many of its customers exceed $100 million in annual transportation spend. The TMC works with
customers in developing optimal transportation networks through its consulting, modeling, and lean six-sigma approach. It then deploys its
personnel and IT for daily transportation planning, management, and continuous performance improvement. If the customer chooses, the TMC
can utilize CHRWs freight brokerage and international freight forwarding capabilities, but does so in a customer directed fashion versus a singlesource model. Most TMC customers are using a mix of their own contract carriers and often retain control of their carrier relationships and rate
negotiations. Once operations are up and running, the TMC provides very detailed measures of service and performance though its business
intelligence tools and works with customers to make ongoing process improvements. It is a true network transportation management approach
and the TMC only charges customers a management fee as a percent of FUM for its services and the use of its IT. Typical customer
transportation savings tend to be in the 15% to 20% range.
TMC Online Business Intelligence Tools
An impressive part of the TMCs managed TMS approach is its proprietary (TMC developed) online business intelligence (BI) tools.
Supported by an enterprise data warehouse, the online business intelligence tools provide shippers with leading edge information for making
supply chain process improvements and cost reductions.
On one screen a customer can see all of its transportation network information including: the number of shipments by length of haul, loads
tendered to carriers by the day of the week, shipment weight distributions, and load volumes by carrier mode.
Additional dashboards are available and can be customized to each customers requirements. They typically report metrics based upon the
mode of transport, lane performance, shipment volumes, payload maximization effectiveness, cycle times, and exception management criteria.
Typical service comparisons include actual on time pickup and delivery and individual carrier performance metrics against defined service level
benchmarks. Overall, the TMCs online applications provide a good deal of functionality and well presented "actionable" information.
In addition to operational and service reporting, the TMC has recently added functionality to allow customers to track their transportation
environmental (carbon dioxide) footprint.
It has also added social network functionalityTMC connectproviding an easy online way for customers to brainstorm process
improvement ideas with other customers and TMC personnel. TMC connect also provides a platform for the TMC to communicate new
products and features.
European TMC Operations
At the request of some of its major customers, C.H. Robinson Worldwide researched the market potential of opening a TMC operation in
Europe. Once the opportunities were quantified and a business plan was developed, C.H. Robinson Europe began bringing its European TMC
operation online in October 2008. Significant operating and information technology areas of adaptation for Europe included operating in
multiple cultures/languages, incorporating value-added tax (VAT) functionality into the C.H. Robinson transportation management system,
managing networks with different hours of operations, uneven electronic connectivity between transportation parties versus North America, and
the use of routing guides with more than just one provider in a lane. Once the TMC model was adapted for the European market, it began
operations for its first customer in February 2009. TMC Europe is collocated within its existing Amsterdam office with the C.H. Robinson
Europe freight forwarding branch operation.
The European TMC operation currently has a staff of six managing over 50,000 annual truckload and less than truckload (LTL) shipments.
As in the U.S., the Amsterdam TMC electronically receives customer orders, develops transportation plans and tenders shipments to carriers
across multiple modes. In addition, C.H. Robison is providing freight bill audit and payment services for shipments handled in the EU. The
process is seamless and highly automated. Most shipments move from electronic order entry to carrier tendering without human intervention.
The TMC staff concentrates on working out operating exceptions, coordinating carrier dock assignments, and providing customer support.
To support European operations, C.H. Robinsons TMC has customized its proprietary CHRWOnline transportation management system
(TMS) and dubbed it CHREU Online. The TMS has been used for eight years in Europe and is supported by a European based IT
development team. It can manage customer orders, assign orders to shipments and tender shipments to carriers. The system provides C.H.
Robinson personnel, customers, and transportation providers with personalized interfaces for managing orders, shipments, payment processing,
exception handling, and providing online supply chain visibility. In addition, CHREU Online has been customized to handle VAT accounting
issues, different country postal codes, and multiple languages.
Overall, the TMC European and North American operations provide a cohesive web-based system functioning as a global control tower.
18th Edition
Key Personnel:
Chris OBrien, Vice President, C.H. Robinson Worldwide
Mick Winker, Director of Transportation, C.H. Robinson Europe BV
Benjamin Lebreut, European Sales Director, C.H. Robinson Europe BV
Ben Spilger, Antwerp, Belgium Branch Manager, C.H. Robinson Europe BV
Eddy Genevay, Lyon, France Branch Manager, C.H. Robinson France
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Because of its diverse operating geography the branch is organized by countries and regions. Cultural fit is critical when dealing with
customers and over 850 transportation providers from different countries. According to branch Director Eddy Genevay, cultural understanding
is a key driver in employee recruiting and is reflected in the 18 different nationalities of the Lyon staff and 24 different languages spoken within
the branch. The majority of the staff are also transportation college or university graduates and C.H. Robinson has a significant focus on training
and professional development.
Lyon became part of C.H. Robinson in 1999 through the acquisition of non-asset based transportation manager Norminter S.A. Its growth is
detailed in the timeline below:
Established in 1991 : 2 people
1999 : 7 people 2 operations groups covering South & North Europe
2000 : 12 people 3 operations groups adding France
2002 : 22 people 5 operations groups: split South (Italy-Greece / Spain-Portugal) and North Europe (UK-Scandinavia-Eastern Countries
/ Benelux-Germany)
2004 : 28 people 6 operations groups adding Eastern Countries
2006 : 32 people 7 operations groups: split Germany and Benelux
2008 : 39 people 9 operations groups: adding Russia and Customer Service Department
According to Genevay he expects to open up service to Turkey next year and expand Lyon to 60 people by 2012. Like most C.H. Robinson
branch operations, Lyon is working with customers in many vertical industries including: High-Tech, Retailing, Food & Grocery, Paper,
Chemicals, Industrial Manufacturing, Packaging, and Consumer Packaged Goods. Its top five customers are Groupe SEB, CHEP, Tetra Pak,
Manitowoc, and Unilever.
European Customer Case Study Briefs
U.K. based Kingspan Insulation tapped C.H. Robinson in 2006 to be a core transportation provider for less than truckload (LTL) and
truckload insulation products shipments from its manufacturing plant in the U.K. to construction sites in Western and Eastern Europe. C.H.
Robinson Europe worked with Kingspan in designing the operating procedures and assigned a dedicated account team to manage the project
out of C.H. Robinsons Budapest, Hungary office. The group will manage over 1,000 shipments annually. Kingspan has visibility to all
shipments in route via C.H. Robinsons transportation management system CHREU Online.
Mars, a global producer of candy and pet care products, selected C.H. Robinson Europe as a core transportation provider in 2001 to manage
over 2,600 annual truckload, LTL, and temperature control shipments from four origin countries destined to other EU countries. In addition to
its core transportation provider services, C.H. Robinson also provides surge carrier capacity to Mars when it has extraordinary peaks in
product demand. As part of a value-added service, C.H. Robinson developed customized service reports for Mars and has provided Mars with
access to CHREU Online.
Summary
C.H. Robinson has replicated its North American operating strengths in the European transportation management market using a familiar
recipe of sharp people supported by technology. While doing so, it has built its network with locals and leveraged their local and regional
marketing and sales expertise. This decentralized customer focused approach is working well and continues to fuel C.H. Robinsons European
and global growth.
C.H. Robinson's Secret Weapon: The Transportation Management Center
http://www.3plogistics.com/CHRW-TMC-2008.htm]
Chicago, Illinois USA Site Visit
July 9, 2008
Key Personnel:
Chris O'Brien, Vice President, CHRW
Jordan Kass, Director, TMC Services
Jim de Vries, Director of Operational Excellence
Chris Brady, Manager of Operational Excellence
Glenn Koepke, General Manager - Chicago, TMC
Tyler White, General Manager - Minneapolis, TMC
Transportation Management Center Overview
Headquartered in Chicago the Transportation Management Center (TMC), a division of C.H. Robinson Worldwide, has roots extending back
to Robinson's purchase of American Backhaulers in 1999. The TMC has quietly grown to become Robinson's primary lead logistics manager
(LLM) solution for customers looking for an integrated, transparent and carrier neutral transportation management approach. Today it has over
130 employees and $1.15 billion in freight under management. Its offices are in Chicago and Minneapolis and it will be opening an Amsterdam
office in the fourth quarter of 2008.
The TMC focuses on working with large shippers in developing optimal transportation networks through its consulting, modeling, and lean
six-sigma approach, and then utilizes its personnel and IT for daily transportation planning, management, and continuous performance
improvement. If the customer chooses, the TMC can bring the full bear of Robinson's freight brokerage and international freight forwarding
capabilities, but does so in a customer directed fashion versus a single-source third-party logistics (3PL) model. Most TMC customers are using a
mix of their own contract carriers and often retain control of their carrier relationships and rate negotiations. Key customers include: Coca-Cola,
John Deere, Ocean Spray, and Tetra Pak.
TMC Online Business Intelligence Tools
TMC utilizes Infor/CAPS for transportation planning and an extensive suite of proprietary software to manage customers' daily
transportation optimization and execution operations. One of the most impressive parts of its integrated transportation management systems is
18th Edition
the proprietary, TMC developed, online business intelligence tools. Written in .Net and supported by an enterprise data warehouse, the online
business intelligence tools provide shippers with leading edge information for process improvement and transportation cost reduction initiatives.
As the "screen shot" below shows, on one screen a shipper can see all of its transportation network information including: the number of
shipments by length of haul, loads tendered to carriers by the day of the week, shipment weight distributions, and load volumes by carrier mode.
The following screen provides ad-hoc summaries based upon user defined parameters such as analysis timeframe, carrier modes, individual
lanes, shipment volumes, and other key areas of analysis. It details on-time pickup and delivery and individual carrier performance metrics
against defined service level benchmarks.
Overall the system provides a good deal of functionality and well presented "actionable" information. One customer using the TMC online
tools is John Deere. Its inbound transportation improvement history with the TMC is detailed in the case study below.
John Deere Inbound Transportation Management Case Study
Prior to 2007, John Deeres inbound transportation was being managed by its suppliers. Because John Deere works with several thousand
suppliers, it was experiencing higher costs and inconsistencies within its inbound supply chain network. After joint meetings and an initial
analysis, the TMC identified an opportunity for additional savings from developing an inbound transportation management program. The
following objectives were created in collaboration with John Deere:
Transition all inbound freight from a supplier-managed to a TMC/John Deere-managed operation.
Develop metrics to drive carrier routing compliance.
Determine the overall potential cost savings opportunities and create benchmarks.
Deploy a transportation management systems solution to optimize transportation.
Perform a transportation network analysis.
Provide John Deere with recommendations for reducing its inbound transportation spend.
From the objectives above, the TMC worked with John Deere in establishing a centralized transportation management center. Its focus was
to oversee the centralized management and execution of John Deeres domestic transportation strategy and provide support services including:
network analysis, transportation modeling, a pool point program, and TMS implementation.
Beginning in Phase One of establishing the John Deere centralized TMC operation, four primary steps were outlined:
1. Perform a transportation network data analysis and evaluation based on:
a. North American inbound materials shipments.
b. Service parts shipments to John Deere distribution centers.
c. Returnable container shipments back to suppliers.
2. Determine the scope of the project based upon the data analysis.
3. Develop inbound transportation management scenarios and strategies.
4. Make inbound transportation optimization recommendations to John Deere.
After the data analysis was performed, the TMC presented its findings to John Deere and recommended an inbound solution that included
transportation management systems deployment, developing a cross-docking/pool point network, utilizing dedicated fleets, constructing multistop truckloads, and performing less-than-truckload consolidations.
Once John Deere and TMC had agreed on a solution, steps were taken to streamline all inbound transportation processes and establish a new
inbound operating model. Based on the solution, the TMC and John Deere:
1. Defined and implemented a transportation procurement strategy.
2. Defined and managed a project plan-based implementation.
3. Developed and implemented a vendor carrier routing compliance management program.
4. Defined the necessary metrics and benchmarks for analysis and process improvements.
The next step was to deploy the TMC transportation management system and integrate it into the new inbound model. As of third quarter
2007, all of John Deeres inbound freight transactions were operating on the TMC transportation management systems platform. The TMC
optimizes inbound transportation as follows:
1. Suppliers enter their shipment data into the TMC online system.
2. The TMC filters the shipment data to facilitate order and mode optimization.
3. Optimized shipments are created and tendered to John Deeres inbound carriers.
4. The TMC business intelligence tools are utilized to monitor the process and report results.
The results from Phase One have been an overall reduction in transportation costs through the use of planning and optimization tools,
implementation of streamlined processes, increased order visibility, and improved service levels from the development and implementation of
performance metrics across the John Deere supplier base.
John Deere and TMC are continuing to align resources, analyze the new inbound optimization model, and remain dedicated to continuous
process improvements. Phase Two of the overall project has been started and includes: continuing to execute and analyze the deployed inbound
optimization model and to determine the appropriate thresholds needed to expand the model beyond the initial phase. John Deere and the TMC
mutually share the goals which determine the success of John Deeres transportation management operations and are currently making ongoing
process improvements and finding ways to reap additional transportation cost savings.
Summary
While it has been "flying under the radar" within the large C.H. Robinson Worldwide operating network, the TMC provides a unique offering
to support lead logistics manager operations. We definitely see this approach meeting the needs of large shippers needing network transportation
management with top-notch IT support. When the TMC adds international capabilities, the solution will add additional appeal to multi-nationals
managing global supply chains. The TMC is a good solution for a shipper looking to outsource its transportation network or upgrade its
transportation management processes.
18th Edition
A Conversation with Jim Butts, Senior Vice President, C.H. Robinson Worldwide
LQ: How does your firm develop innovative ideas and sustainable supply chain practices in the field?
Jim Butts: When we bring our own knowledge of the customer, our understanding of their industry or vertical, and our own supply chain
expertise and insights into a customer's world, innovation can take place. As a third party, we can evaluate what they and their supply chain
partners are doing, with objectivity and a new perspective. This is important, because if a company has a competitive advantage in supply chain,
continuous improvement will maintain their success.
However, most companies are not truly leaders in supply chain, and in order to establish competitive advantage, true innovation is required.
Sustainable innovation within the supply chain is achieved only through collaboration which results from mutual commitment, multilevel
engagement, and an ongoing process to encourage both risk-taking and sharing the rewards of success. Innovation is the creation of intellectual
property, and we have seen it result only from true win/win relationships.
LQ: What are the flexibility-based strategies that your firm uses with its customers to define its overall supply chain strategy?
Jim Butts: We began as an employee-owned company, so I think that the drive to be flexible and innovative runs strong through the culture
of our organization. Our people have the best interest of the customers in mind. We think that's really significant. They are the strength of our
organization. The way that strength manifests the customer experience is through our account management.
We define account management by our people's knowledge of the customer, their understanding of supply chain management in general, and
their understanding of the competitive position of the customer in relation to their business environment. When you have those factors
combined with a flexible business model and the resources that we have - 7,200 employees, 235 branches, 35,000 shippers and 47,000 contract
carriers - we are able to provide a tremendous amount of capability and solution capacity on a daily basis.
LQ: How does your firm develop innovative practices in supply chain management? Do you have meetings dedicated to innovation in
logistics and supply chain management?
Jim Butts: I think that, number one, it comes from our people. Our people have to be the source of the innovation. It can be in the form of
daily suggestions that they make as they interact with a customer or it could be in more formal settings where we have annual business reviews. I
would say we primarily focus on how our customers can benefit from developing innovative practices. After all, it's our shippers and contracted
carriers that can benefit from our innovation and put these ideas into action.
The quality and variety of the service providers that we have relationships with are also extremely important. The contracted carriers that we
do business with, whether they're truckload carriers, LTL providers, steamships, airlines - when we are able to bring those resources and offer
them in a way that others can't, our people are able to leverage the relevant resources quicker and more effectively than anybody else in the
marketplace. That's our goal. When resources become important, our people can access those resources quickly.
LQ: Executives in performance-based tasks sometimes claim a too-tightly written statement of work makes their outsourcing partners
responsible for this work without the flexibility to show their own initiative and innovative solutions. How does your firm share its innovative
insights in this context?
Jim Butts: Anytime we see a customer doing something that we believe is not productive, not beneficial to them, less efficient than other
means, or may not be in their best interest long-term, we believe it is our obligation to bring it to their attention. That can be challenging because
customers are not always open to receiving this kind of feedback. They may view suggestions and recommendations as criticism. We believe
expressing our opinion and sharing best practices is ideal. We do it as politely, diplomatically, and effectively as possible.
There are times when our customers will formally have our people come in and say, "Give us some suggestions on what we can do in order
to improve our supply chain." We think our ability to respond to their needs is an important factor as well. However, we think it is even better
to be proactive. We're continually looking for ways we can improve our customers' supply chains, their operations, their processes, and
facilitating communication. That's how they become the valuable business resources that our clients expect.
LQ: How does your firm balance and mitigate risk with innovation and business development?
Jim Butts: Risk mitigation and compliance have become key considerations in outsourcing. Several years ago people might have expressed
concerns with putting all their eggs in one basket. Now risk mitigation comes in the form of customers coming to us and saying: "Hey, there are
a lot of shaky baskets out there. Let's talk about what you can do for us because you're financially strong, have a healthy balance sheet and you
have a lot of desirable financial qualities that we seek in a key provider." Financial stability, in terms of risk mitigation, is probably something that
is understated, but it has become a bigger factor as we've come along.
The fact of the matter is, with risk mitigation you have to realize that when you're in a relationship with a customer, identifying risks is an
important part of that. If you look at the concept of a supply chain, risk is a danger to all the supply chain participants because if it is not
properly addressed, it can be transferred from one area to another. Identifying the risk components and identifying the ways to reduce the
likelihood or severity of risk are two very critical components within any supply chain partnership.
LQ: When your firm looks at developing innovative and sustainable supply chain practices does it consider innovation in its alignment with
its partners?
Jim Butts: As you look at business challenges, we have found that the more viable resources and options that we have for a customer, the
better the solution that we're going to be able to develop for them. The quicker we're able to access and implement that option - identifying
what might happen, developing contingency plans, and being able to mobilize those alternative options before it becomes a problem - the more
seamless it's going to be to the customer and the more likely it is that they're going to continue to satisfy all of their stakeholders as well.
One thing that we continually talk about within our organization, is that being a problem solver is a highly valued skill; however, the much
higher art and more valuable skill is to be a problem preventer - avoiding problems within a supply chain. I think that's a success factor we bring
to our truly unique customer relationships.
LQ: What are some of the practices in sustainability that your firm has developed?
Jim Butts: A few years ago sustainability and green capabilities were almost a list of formal checkboxes on a lot of our requests for
information, or requests for proposals from many shippers. But today, they have higher expectations, and rightly so in terms of the relevant
capabilities of service providers such as C.H. Robinson. We've spent a lot of time finding things that we can do as an organization to reduce our
carbon footprint.
But as a third party, you also have to be creative. We work with the EPA SmartWay through its program to develop more effective criteria
for grading third party logistics companies. One of the other things that we've done is partner with a non-profit company in Oregon called
Cascade Sierra Solutions. Their mission is to identify technology for the smaller carriers that will allow them to reduce their carbon emissions
and improve their fuel efficiency. They identify this technology and then they provide funding in various manners to those carriers who wouldn't
otherwise be able to accomplish those green and fuel efficiency initiatives.
We are continuously developing ways to add greater value and positively impact our contracted carrier base, and capacity in general. We find
that the relationship with Cascade Sierra Solutions is a very effective way for us to have an impact on the carrier base, and a part of the carrier
base which is very critical to efficiently delivering goods throughout the United States and North America.
LQ: What are some of the other areas that drive sustainability practices in your firm?
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Jim Butts: I think it's important to note that often times with green and sustainability initiatives, reducing waste in a supply chain, reducing
empty miles for trucks, and converting to different modes to save fuel, are pretty standard practices achieved through transportation
management.
Many of our customers' green and sustainability initiatives can be accomplished simply through better transportation management, which of
course we provide on a daily basis for so many customers.
C.H. Robinson Buys Walker Logistics Overseas
[By Alan M. Field, The Journal of Commerce Online, July 10, 2009]
C.H. Robinson Worldwide, one of the largest non-asset based third party logistics companies in the world, announced today that it has
acquired certain assets of International Trade & Commerce, a Laredo, Texas-based customs brokerage company specializing in warehousing and
distribution.
ITC provides a broad range of services facilitating international customs brokerage in all modes of transportation. Hector Tafoya established
the company in 1989, and will continue as C.H. Robinsons general director of the United States and Mexico Border Operations Center. The
value of the transaction was not disclosed.
"ITC strengthens our ability to provide customers a seamless cross-border service package across the United States and Mexico border," said
Scott Satterlee, senior vice president at C.H. Robinson. "Customers increasingly want a single point of contact to provide visibility and
consolidated invoicing in order to achieve optimal efficiency with their transportation spend. ITC greatly enhances our ability to meet those
needs."
C.H. Robinson will continue to operate out of ITCs 55,000-square foot warehouse and distribution center in Laredo, Texas.
"Customers are looking for a global provider to deliver comprehensive strategic solutions that decrease transit time and risk while increasing
reliability, security, and legal compliance, Tafoya said. Combining our resources with C.H. Robinsons increases our ability to meet these
growing customer needs."
C.H. Robinson has been providing transportation services in Mexico and along the border for over 20 years. The company has 10 offices
along the United States and Mexico border, and over 100 employees dedicated to those local markets.
Readers Choice Top 10 3PL Excellence Awards 2010
#2 C.H. Robinson
WHY THEY WON: C.H. Robinsons fans repeatedly praise the Eden Prairie, Minn. -based 3PLs grasp on customer needs. They exceed
the requirement of just moving
my cargo-they understand my business," says one reader.
Another satisfied customer is Republic Plastics, a manufacturer of foam tableware and containers with facilities in Texas, Tennessee, and
Arizona. "C.H. Robinson consistently understands and exceeds our expectations," says Robert Garner, director of transportation, Republic
Plastics. "The representatives we work with are proactive and always seek to improve our operations, which is something that other providers
just don't do."
Throughout the economic downturn, C.H. Robinson helped shippers focus on the importance of operating a competitive supply chain,
according to John Wiehoff, CEO and chairman of the board, and the 3PL plans to maintain that focus as circumstances improve. "Our business
model of providing high-service, high-quality logistics services continues to have increasing relevance to many customers who want better
information and to manage their freight transportation more efficiently," Wiehoff says.
CASE STUDY: Ocean Spray
Five years ago, beverage brand Ocean Spray chose a Managed TMS solution from TMC, a division of C.H. Robinson Worldwide Inc., to
optimize its transportation network. Ocean Spray's on-time deliveries, which have a measurable impact on sales, soon jumped from 85 to 95
percent.
While Ocean Spray retained control of its carrier relationships, TMC took over routing guide management. Carriers accepted more tendered
loads, which kept freight costs in line. With detailed reporting, Ocean Spray could track costs per load delivered, per mile, and per caseinformation central to budgeting and pricing.
"TMC is intimately aware of what's going on in our business," says Wayne Tessin, Ocean Spray's director of logistics. "They routinely bring
us new ideas, and they fit extremely well with our culture."
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1993
Asset Focus:
Market Area:
Founding Business:
China
Air Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Herman Tam
Managing Director
Alex Ng
Elvis Ko
Sales Manager
Operations Director
Steve Ho
Executive Director
Ticker Symbol
2 **
Exchange:
18
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.004
Total Tankers:
Total Other:
MAJOR MARKETS
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Armani Exchange
Industry
Location
TM
WM
VA
DCC
Inte IM
Apparel
Australia
Hong Kong
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Asia/Pacific
Europe
North America
Cargo Express
Latin/South America
Hong Kong
Shanghai
EDITOR'S COMMENTS
Cargo Express International (H.K.) Ltd. was founded in 1993 by three partners. Two of the partners, Herman
Tam and Steve Ho, are still with the company today. Both had previous experience in the cargo airlines business
before the startup of Cargo Express. Herman and Steve are interested in M&A activity to expand the business.
Cargo Express provides air and ocean freight forwarding. Armani Exchange is a major customer in the Hong
Kong to US lane. The relationship has continued for nearly 10 years.
Provider's Strengths
Provider's Weaknesses
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1990
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
John Lau
Managing Director
Barry Ng
Christopher Lau
Ticker Symbol
335
65 **
2,250
10
2
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
100
Total Trucks:
Total Trucks:
15
Total Other:
Total Trailers:
Total Aircraft:
120
Total Ocean:
Total Other:
0.3
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ASDA
General Merchandisers
China
Apparel
China
Davidoff
Tobacco
China
Escada
Apparel
China
Esprit
Apparel
China
G2000
Apparel
China
GE Lighting
Diversified Financials
Hong Kong
Gucci
General Merchandisers
China
H2O Cosmetics
China
Lane Crawford
Specialty Retailers
Matalan
General Merchandisers
China
Myer Group
General Merchandisers
Global
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Iran
Isreal
Cambodia
Guam
Belgium
Mexico
China
New Zealand
France
United States
Hong Kong
Saipan
Germany
Argentina
Brazil
Chile
Colombia
Uruguay
Venezuela
Kenya
Mauritius
Australia/New Zealand
Cyprus
Africa/Middle East
Asia/Pacific
Greece
India
Sri Lanka
United Arab Emirates
Ireland
Indonesia
Italy
Indonesia
Netherlands
Japan
Norway
Korea
Portugal
Malaysia
Spain
Pakistan
Switzerland
Philippines
Turkey
Singapore
United Kingdom
Taiwan
Vietnam
EDITOR'S COMMENTS
Cargo Services Far East is a sophisticated, well run 3PL and freight forwarder. IT systems are good.
Provider's Strengths
Bi-cultural management and depth of knowledge of Cantonese market.
Provider's Weaknesses
MIAMI, February 11, 2010 Ryder System, Inc. (NYSE: R), a leader in transportation and supply chain management solutions, today
announced it has signed a joint venture (JV) partnership with Cargo Services Far East Limited (CSFE), an Asia-based logistics solutions
provider specializing in export consolidation services.
The combined strengths of the companies will create a comprehensive, end-to-end service offering, with full geographic coverage throughout
Asia, for North American retailers and other companies importing from Asia.
This partnership gives us an extensive network throughout Asia and builds on our purchase order management and export consolidation
capabilities to deliver seamless international solutions to the retail marketplace, said Ryders President of Global Supply Chain Solutions, John
Williford. The partnership applies our strengths in operational execution, engineering and information technology to enable us to help retailers
and other U.S. importers design, plan and manage their product flows from factories in Asia to retail stores across North America.
Operating as Ryder Supply Chain Solutions Asia, the solution will provide Vendor and Purchase Order Management, Inland Transport
Services, Export Consolidation and Order Fulfillment Services, including Distribution Center Bypass and Store-Ready Pallet Construction from
Asia to North America. It builds upon Ryders recent acquisition of CRSA Logistics, which manages Trans-Pacific end-to-end transportation
management and supply chain services for Canadian retailers, including consolidation services in key Asian hubs and deconsolidation operations
in Canada.
Mr. John Lau, Group Managing Director of CSFE, stated, We entered into this partnership with Ryder because they are a well-respected,
Fortune 500 company with more than 30 years of supply chain expertise. Together, we can leverage each others logistics capabilities and
expertise to offer a better solution to retailers and traders of consumer products. Users of these services require a personalized and attentive
international supply chain for the execution of their purchase orders placed in China and the rest of Asia and the movement of their products to
destinations in North America.
Australia's Largest Department Store Chain Chooses Cargo Services
May 11, 2007 - Cargo Services Far East ("Cargo Services"), a leading integrated logistics services provider in China, has recently been chosen
by Myer Group ("Myer") to be its freight manager and global logistics service provider into Australia. As a part of this contract, Cargo Services
will setup dedicated consolidation and scanpack centers in Shanghai, Shenzhen and Singapore to process Myer's direct imports from China and
around the world.
Myer was separated from Coles Myer in 2006 in a management buyout led by Newbridge Capital, part of the Texas Pacific Group. As a result
of the separation from Coles, Myer management decided to reorganize its supply chain management and issued a global tender in September
2006.
Based on the strength of its reputation in the Australian market, Cargo Services was invited to tender for the management of Myer's
international supply chain into Australia together with several global players that included DHL and Expediters International.
After a rigorous three-month review, Myer's management team unanimously selected Cargo Services to be its freight manager and global
logistics service provider into Australia. This was a significant account win for Cargo Services as Myer had been previously serviced by DHL for
many years as a part of Coles Myer.
The decision to choose Cargo Services was attributed to its technology, strong account management team and extensive experience in
servicing the Australian market. As part of this contract, Cargo Services will also be implementing its popular LIMA logistics event management
and visibility system, which will be integrated into Myer's in-house procurement systems.
Largest Privately Held Supply Chain Network In China Opens U.S. Division
LOS ANGELES, OCTOBER 13: The largest privately held supply chain network in China with annual revenues exceeding $200 million,
has just opened a U.S. division under the direction of one of the most experienced cargo executives in the international logistics industry.
CS International Logistics (USA) LLC, with headquarters in Los Angeles, is offering complete supply chain management solutions for U.S.
companies trading in China, now the largest exporter to the United States. This new division, a subsidiary of Cargo Services Far East based in
Hong Kong, is headed by Sam Schotsky, a thirty year cargo veteran with much of those three decades involved in U.S.-Asian freight forwarding.
In making the announcement of Cargo Services' new U.S. division, Schotsky stated, "we believe our company is in a unique position to
respond to the many differing logistics needs of companies importing both consumer and business products from China. We have the people,
the expertise and the physical infrastructure within China."
Schotsky noted that Cargo Services currently has 19 owned and operated offices (not agents) in China with a trained, experienced staff
numbering "just under two thousand." The company is planning to open an additional 15 offices by late 2005, in China. Additional staff will be
hired to accommodate this growth. Schotsky emphasized Cargo Services' offices are located not only in centers along the Chinese coast where
much of China's industry now is concentrated, but also in the lower labor cost inland cities that are fast growing sites for manufacture and
commerce. Cargo Services also has recently opened offices in Pakistan
and the United Arab Emirates.
Cargo Services holds numerous licenses that allow it to offer complete logistics services in China without any kind of intermediary. "Holding
these licenses (Class A Forwarders, NVOCC, Domestic Logistics, Air Transport Qualification Certificate) which few private companies actually
possess, allow us to offer complete sea and air freight forwarding as well as rail and truck transportation within China," asserted Schotsky.
The U.S. chief executive noted that as trade between the U.S. and China grows larger, it also grows more complicated. "Moving cargo from a
container berth or an airport across the Pacific is the final and often simplest part of the process," Schotsky stated. "Terms and conditions for
exporting merchandise start right on the factory floor and the logistics firm must be prepared to cope fully with these circumstances. Cargo
Services Far East offers complete factory audits, special export documentation when required, assurance that quality control inspection
procedures have been followed, even if fumigation of the product is
necessary."
"Another critical consideration is how rail and truck can be used most efficiently, particularly from inland points," said Schotsky. "These and
many other questions can be answered only by an organization with a thorough and detailed knowledge of Chinese regulations and procedures,"
he averred. Schotsky noted that Cargo Services' twelve years of China operations "give us a big competitive advantage in meeting total clients'
needs in this huge and dynamic market."
Referring to Cargo Services' electronic capabilities, Schotsky stated the company's IT system is arguably the most advanced of any logistics
firm servicing the China market. "It is user friendly, with customers having visibility and management control along each step of the journey-from purchase order placement to arrival on the customer's dock."
While CS International Logistics (USA) is new to the U.S., its parent, Cargo Services Far East is an "old China hand." The company opened
its doors in Hong Kong in 1990, entered China itself in 1992 and has expanded rapidly to keep pace with the rise of China as a great exporting
18th Edition
nation. Last year, Cargo Services Far East handled 250,000 TEUs and 13,500 metric tons of air cargo, a record for the company. Today, its U.S.
division, CS International Logistics, offers complete supply chain logistics and freight forwarding services to and from the Asian market.
In addition, Cargo Services Far East is a growing force in the importation of consumer goods to a seemingly insatiable China market. The
company offers "one stop" shopping for importation of merchandise into that country by providing customs clearance, inventory management,
logistics and distribution of goods to distributors or retailers.
18th Edition
cat_logistics@cat.com
630-743-4197
COMPANY BACKGROUND
Parent Corporation:
Caterpillar Inc.
Asset Focus:
Market Area:
Founding Business:
International
Manufacturing
OVERALL CAPABILITY
Overall Capability of Provider:
Provides integrated solutions from managing transportation, inventory, and distribution centers to sophisticated forecastin
KEY PERSONNEL
Steve Larson
Moe Iversen
Mark Hynes
VP & CFO
VP Americas & Asia Pacific Business
3,119
2,300 **
Exchange:
12,000
60+
5-10
NYSE
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
29
Total Other:
Total Trailers:
Total Aircraft:
15
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--CAT TIS, i2 Technologies, GT Nexus
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i2 Technologies
SAP EWM, Proprietary, ProAct
Proprietary--CAT TIS
SAP CRM, Proprietary, ProAct
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
AGCO
Europe
Manufacturing
US
BMW
Europe
Bombardier
US, Europe
US
Caterpillar
Global
Daimler
Global
Delphi
US, Europe
Donaldson
Industrial Machinery
US
Eastman Kodak
Europe
Eaton
Industrial Machinery
China, Japan
Emerson Electric
China, Japan
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Latin/South America
Austria
Canada
India
Belgium
Mexico
Brazil
Venezuela
Japan
France
United States
Singapore
Germany
Egypt
China
South Africa
United Arab Emirates
Australia/New Zealand
Cat Logistics
Australia
South Korea
Italy
Netherlands
Poland
Portugal
Spain
Sweden
United Kingdom
EDITOR'S COMMENTS
Cat Logistics has heavy U.S. and European operations with a growing presence in South America and Asia,
distributing to more than 190 countries from over 130 facilities. Cat Logistics scope reflects its parents global
reach and dealer network. Cat Logistics business is split equally between North America and the rest of the
world. It continues to expand its automotive logistics business in Europe and the U.S. Cat Logistics has
completely integrated warehousing and manufacturing supply chain services. Visibility in its integrated systems of
SAP, i2 and GT Nexus is very good. Demand and supply forecasting and material planning capabilities are
excellent. Forecasting for low turnover items is a controlled standard operating procedure. Caterpillars
transportation department was merged into Cat Logistics in 2001, bringing its transportation management
capability. Cat Logistics manages over $1.8 billion in purchased transportation per year. Cat Logistics focuses on
customers with high-value durable goods. A major initiative involves logistics into and out of China.
Provider's Strengths
Very good supply chain planning and execution, global network of facilities with efficient warehouse operations,
implementation experience and in-depth knowledge of the SAP SCM Solution. Can leverage parent company's
financial and manufacturing strength.
Provider's Weaknesses
project which started in 2004 when a feasibility study was performed. In August 2005, Cat Logistics made a proposal to MHI and Caterpillar to
combine operations into a new, more efficient distribution operation. On June 9, 2006 logistics agreements were signed by Caterpillar and MHI
and in December 2006, the old Caterpillar center on the current site was demolished and new building construction began.
The Sagamihara distribution center (SDC) is a two-floor operation with room to expand to a third floor. The SDC comprises 35,000 square
meters for Caterpillar supply chain management operations and approximately 16,000 square meters for MHI operations, of which the total
facility has approximately 21,000 square meters reserved for parts and product storage. Approximately 380,000 stock keeping units (SKUs) of
parts and products are kept in on-hand inventory.
On an average day 3,800 lines of parts and products are received, 110,000 pieces are packaged for shipping, and 10,300 lines of service parts
and products are shipped. In terms of a standard order profile, approximately 80% of Caterpillar Japan domestic orders are for emergency/JustIn-Time (JIT) fulfillment. Cat Logistics has just one hour from order release to pick and pack emergency/JIT shipments and have them available
for loading on an outbound truck. Similarly, approximately 75% of MHI orders are also emergency orders. Export orders must be processed the
next day for emergency shipments, or within five days for items in stock. To run operations, Cat Logistics is using its SAP warehouse
management system (WMS) integrated with radio frequency (RF) scanners.
Storage locations in the distribution center are dictated by the individual demand forecasts for each part or product. Very slow moving items
are stored outside when possible, or on the second floor of the SDC. Approximately 20% of the total pick volume comes from these areas. The
remaining 80% of the total picks come from the first floor and are most often made from a central three-level mezzanine which accounts for
64% of all picks.
On the first floor, Cat Logistics is also running a packaging operation for its clients. It occupies approximately 10% of the SDC and employs
approximately 100 people.
Cat Logistics manages parts sourcing services for the Caterpillar network from Japan. Often the service parts and products will need to be
packaged in standard quantities prior to shipping. Cat Logistics performs the packaging services utilizing two main packaging lines. Thirty
percent of the volume is auto-bagged into plastic bags and the rest is manually processed. The parts are then consolidated into large open-top
containers for domestic distribution, put into storage or packaged for export. Value-added services include: wood crating for larger parts,
specialty labeling for local markets and customers, and product rust proofing.
To support the packaging operation, Cat Logistics utilizes a proprietary packaging system (GPPS) which is integrated with the SAP WMS.
Key operational volumes and metrics are as follows:
Inbound truck traffic: Approximately 90 inbound supplier trucks are unloaded each day.
Outbound truck traffic: Approximately 50 outbound delivery trucks are dispatched each day to Mitsubishi and Caterpillar Japan dealer
locations.
Container shipments: Approximately seven forty-foot ocean containers are shipped each day to global Cat Logistics network locations
including: Morton, Illinois; Grimbergen, Belgium; Melbourne, Australia, and Singapore.
Outbound shipping performance: Cat Logistics has performed with more than 99% efficiency in on-time shipping across its clients.
Notable point: The Sagamihara distribution center is processing approximately the same amount of emergency/JIT shipments each day as
the largest Caterpillar parts facility in Morton, Illinois. The emergency/JIT shipment processing time is one hour from order release to having
the shipment available for loading on an outbound truck.
Summary
As a global provider of 3PL services, Cat Logistics has done a very good job in developing specific geographic 3PL strategies. In Japan it has
performed very well in supporting the Caterpillar network, MHI and its other 3PL customers. It has succeeded in building a foundation for
further Asia Pacific expansion.
Cat Logistics Retools its China Strategy to Support Caterpillar's Rapid Growth
http://www.3plogistics.com/Cat_Logistics_China_11-2008.htm]
Shanghai, China - Site Visit
November 19, 2008
Key Personnel:
Paul Joseph - President, Caterpillar Logistics Services, Inc., Asia Pacific Region
Steven Duan - Manager, Lingang China Logistics Center, Caterpillar Logistics Services, Inc.
Overview
Caterpillar Logistics Services, Inc. (Cat Logistics) is a tier-one global supply chain manager. According to Armstrong & Associates estimates,
its 2007 gross revenues were $3.15 billion and realized net revenues $2.12 billion. Cat Logistics has approximately 12,000 employees working on
six continents, 23 countries, and in 110 facilities. Its warehousing footprint is over 27 million square feet and it fulfills approximately 160 million
orders per year. In addition, Cat Logistics manages over $1.6 billion in purchased transportation per year.
Cat Logistics has core capabilities in value-added warehousing and distribution. These include: manufacturing support, vendor managed
inventory (VMI), kitting, sequencing, light assembly, packaging, labeling and spare/service parts distribution. It couples these with international
and domestic transportation management operations to provide an integrated end-to-end supply chain management offering. The majority of its
customer relationships are in the Automotive and Industrial manufacturing industry verticals; however, Cat Logistics has also been diversifying
into Mining, Oil & Gas, Aerospace & Defense, Technological, and Consumer Durables industries. Key logistics customers include: its parent
Caterpillar, Bombardier, Daimler, Eaton, Emerson, Ford Motor Company, Harley Davidson, Kia, Land Rover, Mazda, Mosaic, Newmont,
Toshiba, and Volvo.
To support operations, Cat Logistics primarily uses SAPs enterprise resource planning (ERP) system when needed and either SAPs
warehouse management system, or Cat Logistics proprietary WMS. In many operations, the systems have been integrated to either Cat Logistics
core transportation management system (TMS) from i2 Technologies, or Cat Logistics legacy TMS. Most of its warehousing operations utilize
radio frequency (RF) devices integrated with WMS for paperless putaway and picking and overall inventory management.
Cat Logistics Asia and China
18th Edition
In a recent visit to Shanghai, China, we had the opportunity to spend some time with Paul Joseph, Caterpillar Logistics Services, Inc.
president of Asia Pacific operations. According to Joseph, Cat Logistics has three main business focuses within Asia:
1. Build distribution network to support its parent Caterpillar and develop 3PL business.
2. Help Caterpillar factories with manufacturing logistics and supply chain management.
3. Provide network transportation management services to Caterpillar on a global basis.
To meet Caterpillar's rapid growth in Asia, Cat Logistics has doubled its Australian warehouse capacity and its Singapore and
Lingang/Shanghai warehousing operations are running at near full capacity. The business strategy has been to address service parts logistics
needs for Caterpillar and to focus on organic growth with existing 3PL customers.
Cat Logistics operations supporting Caterpillar's manufacturing operations are adding people for inbound supply chain management,
sequencing, and manufacturing support. According to Joseph, Cat Logistics currently supports 30 Caterpillar manufacturing operations.
Cat Logistics has been operating in China since 2003 when it set up a joint venture with Lei Shing Hong Limited. Headquartered in Shanghai,
it currently has 60 employees which primarily are based at its distribution center in Lingang New City, Shanghai, China.
Cat Logistics Lingang Logistics Center
In January 2005, Cat Logistics began construction of its warehousing and distribution operation in Lingang. The 21,000 square meter facility
was completed in February 2006 and began operations in March 2006. It has both bonded and non-bonded storage and initial operations include
service parts distribution for four large Caterpillar distributors in China.
The Park acts as Cat Logistics China Hub for import/export activities and also performs multiple value-added services including: painting,
kitting, remanufacturing and subassembly. The warehouse has a full-time staff of 20 and the operation has a dedicated customs clearance team.
Caterpillar is the world's largest manufacturer of construction and mining equipment, diesel and natural gas engines, and industrial gas
turbines. Its policy is to provide service parts for its machines and engines as long as there is demand for these parts. Because of this policy,
Caterpillar has significant service parts needs. For Cat Logistics, this drives the on-hand parts inventory of approximately 45,000 stock keeping
units (SKUs) maintained in Lingang. To support operations, Cat Logistics is using a legacy WMS and uses paper tags for product putaway and
picking.
In an average week, 10 ocean containers and 50 airfreight shipments of parts are received directly from suppliers and other Cat Logistics
distribution centers. 80% of the parts come inbound from the U.S., 10% are from Singapore and the remaining 10% are supplied from other
countries. Each inbound shipment is inspected to ensure the quantities received match the order quantities. After they are verified, the items are
put away. Fifty-five percent of the parts are small and are stored in a central bin mezzanine area. The remainder is stored in various racking
configurations or on the floor if they are oversized.
Approximately 1,100 parts order lines are filled each day for 50 outbound shipments to dealers.
The Shanghai government is spending approximately $12 billion to develop Lingangs Yangshan deep water port into the largest port in the
world with over 50 berths and an annual capacity of 25 million twenty-foot equivalent units (TEU's). Cat Logistics distribution center is located
adjacent to the Lingang Expressway, which leads from Yangshan Port to Shanghai's central business district and merges with major roads to the
rest of China. Additionally, Lingang is establishing a new rail terminal with intermodal capabilities.
Summary
As a global provider of 3PL services, Cat Logistics adjusts and adapts its regional geographic strategies to best support its largest customer
Caterpillar and other 3PL customers. With Asia's rapid market growth, Caterpillar is Cat Logistics main focus; however, the network being built
to support Caterpillar is anticipated to provide significant capabilities for future third-party logistics business.
Caterpillar Logistics, a True Global Supply Chain Manager
http://www.3plogistics.com/Cat_Logistics_1-2005.htm]
Morton, Illinois - Site Visit
January 11, 2005
Key Personnel:
Mary Bell - Chairman & President
Michael Schmidt - Global Marketing Director
Mark Hynes - Vice President of Manufacturing Logistics & Transportation
Krish Srinivasan - Sr. Manager of Client Inventory Management Services
Craig Brabec - Manager of IT Strategy & Global Costing
Bill Meek - Competitive Analysis Coordinator
Chad McClaskey - Marketing/Media Relations Manager
Caterpillar Logistics Services, Inc. (Cat Logistics) has leveraged its relationship with parent company Caterpillar Inc. in developing true global
supply chain management capabilities. Cat Logistics has grown to be the sixth largest North American-based 3PL with $1.1 billion in net
revenues in 2003. It has been attracting significant external business; Caterpillar, Inc. now accounts for approximately 50% of the Cat Logistics
revenues. Plans are to grow external business at a compound annual growth rate of 26% over the next five years.
Global logistics operations employ over 9,200 people; the majority work at Cat Logistics 100 distribution centers. This supply chain network
has over 20 million square feet of capacity strategically located in 25 countries. Cat Logistics fills more than 180 million order lines annually and
ships over 16 billion pounds of commodities each year. Cat Logistics annual purchased transportation bill exceeds $1 billion.
According to Chairman and President Mary Bell, Cat Logistics main growth over the next five years will come from expansion in the Asian
Pacific, European, North and South American, Australian, and Russian markets. It is currently developing a new logistics operation in Lingang
Park (Shanghai), China. "We grow by applying combinations of value-added services in the development of a strategic partnership with
customers". Like many large 3PLs, Mary sees finding the right qualified people to fuel its growth as Cat Logistics biggest challenge.
Cat Logistics targets global Fortune 500 companies in five key industry verticals: Automotive, Consumer Durables, Industrial, High Tech.,
and Aerospace & Defense. Customers include: DaimlerChrysler, Ford, GM, Nissan, CNH, Donaldson, Kodak, Toshiba, Bombardier, and
18th Edition
Honeywell.
Cat uses a hierarchical framework in managing its supply chain services offering. At the top level, Cat can help customers in developing an
overall supply chain strategy. It can then perform supply chain design consulting and modeling and systems and technology support services.
The service structure ends with tactical supply chain execution services such as: order management, materials management, transportation
management, distribution, and reverse logistics. Cat Logistics has become a leader in inventory and integrated supply chain management.
To support its global operations, Cat Logistics is developing an integrated supply chain systems "backbone". In a joint venture with Ford
and software giant SAP, Ford and Cat's intellectual property is being used to greatly enhance SAP's warehouse management and inventory
management capabilities. The co-developed system will be released as SAP SPM (Service Parts Management) version 5.0 in Q4 of 2005. Cat
Logistics will use SPM for forecasting, demand planning, inventory management, and warehouse management. It will be integrated with i2's
Transportation Manager for daily transportation planning and management. Unlike many 3PLs who are using three or more systems for a core
supply chain systems backbone, Cat will be able to support its medium to large 3PL customers with two tightly integrated systems.
With top I.T., people, and inventory and supply chain management processes, we anticipate that Cat Logistics will meet its significant
revenue targets and continue as a true "Tier One" global 3PL.
Cat Logistics Morton, IL distribution center is a 2.2 million square foot dedicated service parts facility servicing Caterpillar's dealer and
regional D.C. network. Approximately 375,000 different parts are warehoused having a value of just under $2 billion. With a warehouse staff of
900, approximately 35,000 order lines are filled each day, inbound receipts of 3,000 totes and 2,300 containers are processed, and a host of value
added activities such as parts coating and painting, kitting, and pick/pack are performed. Much of the picking is performed by automated
picking machines. The facility utilizes approximately 26 miles of mechanized conveyer systems for efficiently moving inbound and outbound
units. A consolidated packing area of 60 individual lines is used to pack out orders for shipping.
Caterpillar's dealers have complete inventory visibility and can order parts using Cat's ANTARES parts ordering/processing system. Cat
Logistics has saved Caterpillar millions of dollars by reducing its on hand inventory from 10.4 months in 1989 to 5.5 months today. Even so,
Cat Logistics is currently realizing a system order fill rate of 99.7%.
Cat Caught for Exports
On any given day in 2008, Caterpillar had some $500 million worth of U.S. machines and engines in transit for export and was spending
about $5 million each day to get those goods to nearly 200 countries.
Watching those shipments move through the ailing U.S. infrastructure is why Steve Larson, a vice president for the Peoria, Ill-based
manufacturer as well as chairman and president of its Caterpillar Logistics Services unit, is deeply concerned about where the country spends its
transportation dollars. Nothing short of global competitiveness is at stake, Larson told a Senate subcommittee April 29. The goods we seek to
sell must travel through a multimodal transportation system that includes roads, rail, water and air.
But, he warned, There is mounting concern that U.S. intermodal freight capacity will be unable to keep pace . . . We are failing to act
comprehensively and decisively.
He ticked off a series of problems: deteriorating roads and bridges, along with crippling regulations that trap truck drivers and cut
productivity, and a maze of permitting requirements for large loads that do not work together and are impeding flows between the states and to
U.S. ports.
Export terminal connectivity and capacity is . . . limiting the growth of U.S. export shipments, he said. There are several export terminals
within the U.S. rail network connected by a single rail carrier via inefficient or outdated track infrastructure, which makes access into the facility
extremely costly and inefficient.
In one case, he said, it cost Caterpillar as much to move one set of machines less than a mile on the last leg of a trip to an export terminal as
it cost to the move them about 1,000 miles from central Illinois to Florida.
He told senators that moving a Caterpillar 797 truck chassis from our Decatur, Ill., plant to port of exit requires the plant to remove the
engine and the transmission from the chassis prior to shipment because of weight restrictions in some East Coast states. The unit must then
be reassembled, Larson said, resulting in added cost and delay.
The issue of overweight permit has many sides. Some ports say getting loads even from nearby factories and warehouses are hampered
because access roads are not rated for cargo weights. The Department of Transportation recently said it may look into the effects of overweight
permitting on pavement damage.
Larson also said Caterpillars rail service has declined since late 2008, as railroads cut the number of trains they move after traffic dropped. Its
single-railcar loads often sit wait more than 24 hours to be picked up, he said.
If we are to be successful in growing our economy through increasing exports, he said, this intermodal freight system must be improved
dramatically.
Caterpillar Logistics to Build Facility in Ohio
Caterpillar Logistics Services said it will open a new parts distribution center in Clayton, Ohio.
The center, near Dayton, Ohio, will span more than 1 million square feet, the Associated Press reported.
Construction will begin early next year and be completed by 2011. The company estimates the facility will cost more than $50 million to build.
The facility will eventually replace Caterpillars distribution facility in Indianapolis, AP said. It will also take over some of the work from the
distribution center in Morton, Ill.
Caterpillar Logistics Services, a unit of Caterpillar Inc., is ranked No. 4 on the Transport Topics Logistics 50 listing of U.S. and Canadian
logistics companies.
New Caterpillar Service Parts Center in Texas Kicks Off Network Modernization Plan
Morton, Ill Building on the strength of a best-in-class global service parts distribution network, Caterpillar Logistics Services, Inc. (Cat
Logistics), a wholly owned subsidiary of Caterpillar Inc. (NYSE: CAT), is announcing plans to open a new parts distribution center in Waco,
Texas. The new facility marks the beginning of a multiyear expansion and enhancement of the Caterpillar service parts distribution network
throughout North America.
The more than 500,000-square-foot facility will employ between 140 and 180 people, increase network capacity and provide primary
aftermarket parts support to six Caterpillar dealers in North America. Once operational, the new facility will replace the smaller regional
distribution centers in Dallas, Texas, and Kansas City, Missouri, while increasing total warehouse capacity. It will process dealer stock and
emergency orders as well as inbound parts.
"We certainly recognize the significant value parts availability provides our end users, said Bill Springer, Caterpillar vice president responsible
18th Edition
for the Marketing and Product Support Division. Therefore, this new parts distribution center will help Caterpillar and Cat dealers maintain our
industry leadership by enabling quicker order-to-delivery time."
Currently most parts are routed through a single global entry point in Morton, Illinois. Through this network modernization plan, the new
Texas distribution center will also handle inbound processing of parts directly from suppliers. Services at existing Cat facilities in York,
Pennsylvania, and Denver, Colorado, will be expanded to do the same. When complete, these process improvements will get parts on the shelf
faster and improve Caterpillars ability to fill dealer orders.
We are enhancing the Caterpillar parts distribution network to ensure we continue meeting the expectations of our dealers and customers in
the years ahead. This demonstrates our ongoing commitment to product support excellence," said Steve Larson, vice president of Caterpillar
Inc. and chairman and president of Caterpillar Logistics Services, Inc.
Groundbreaking for the new Waco parts distribution center is planned for the second quarter 2008, with operations expected to be underway
in early 2009.
340 to be laid off at Cat Logistics Services facility
LEBANON, IN A decision by the parent company of Case New Holland will result in the layoffs of nearly 340 workers at the Caterpillar
Logistics Services Inc. facility here.
CNH Global announced on July 31 that it will assume operating responsibilities for seven North American parts depot operations that are
currently managed by Cat Logistics Services, its third-party logistics supplier.
"Our decision to assume direct responsibility for our distribution network represents a strategic change in the way we service our customers,"
said in a statement from Ugo de Carolis, president of CNH Parts & Service. "This change is consistent with our new brand-focused strategy and
will allow us to take a more hands-on approach in providing best-in-class parts and service support to our brands, which is key to building longterm relationships with our customers."
Along with the Lebanon facilities, other depots involved in the change are located in Texas, Georgia, Pennsylvania, Illinois and Canada.
CNH Global, a world leader in the agricultural and construction equipment business, said it will work closely with Cat Logistics over the next
several months to complete the transition process and expects to assume full control of the depots during the first quarter of 2008.
Employees at the impacted depots will have an opportunity to be considered for positions with CNH.
18th Edition
(5411) 5983-9630
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1996
Asset Focus:
Market Area:
Founding Business:
Argentina
Logistics
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Francisco Alvarez
CEO
Jorge Monti
Marcelo Ormachea
Business Mgr.
Operations Mgr.
Carlos Musante
General Mgr.
14
Ticker Symbol
14 **
Exchange:
350
18
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
100
Total Other:
Total Reefers:
Total Flatbeds:
0.646
84
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): RDS Owner System
Transportation Planning and Optimization:
Warehouse Management System (WMS):
WMS Transport
RedPrairie, Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Danone
Argentina
General Motors
Argentina
Grupo Arcor
Food Production
Argentina
Michelin
Argentina
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Celsur
Latin/South America
Argentina
EDITOR'S COMMENTS
Celsur provides consulting to optimize supply chains throughout Argentina and parts of Brazil, Chile, Paraguay,
and Uruguay. It recently won an International Award from General Motors for process improvements they have
made in their supply chain.
Provider's Strengths
Regional distribution.
Provider's Weaknesses
Warehouse management solution to be installed at 31 sites, including the first implementation in Argentina
MILWAUKEE--(Business Wire)--RedPrairie Corporation, a world leading consumer driven optimization company, and its partner
NetLogistiK, today announced that seven companies in Latin America have recently chosen RedPrairie's Warehouse Management solution.
NetLogistiK will implement RedPrairie's Warehouse Management solution for six new customers in Mexico and one in Argentina. NetLogistiK
and RedPrairie became partners in 2003 and currently have 42 sites in Mexico and Latin America.
"Latin America is awakening to a more advanced supply chain technology. As the world becomes more globalized and boundaries irrelevant,
Latin American companies of all sizes are facing increasing competition from both near and far away countries. Especially in the vertical
industries of retail and high-value goods, such as pharmaceutical, electronics and third party logistics (3PL), companies are adopting technology
to better manage inventory both in the warehouse and in transit while protecting their operating margins. These companies are gaining supply
chain security and visibility to give them a strong competitive edge," said Francisco Giral, CEO for NetLogistiK.
Companies that recently chose RedPrairie solutions in Latin America include:
--------
Accel, a third party logistics provider, chose RedPrairie WMS and RF solutions to run at more than 10 sites in Mexico
Servicargo, a third party logistics provider, plans to implement the WMS and RF solutions at five sites in Mexico
Farmacias del Ahorro, a pharmaceutical retailer, will implement WMS, Voice Picking and RF at three new sites in Mexico
Multipack, a third party logistics provider, has implemented its first site in Mexico City in a record time of 12 weeks
Grupo Dico, a furniture retailer, has chosen NetLogistiK for distribution center design and RedPrairie WMS for two new sites in Mexico
Farmacia Guadalajara, a pharmaceutical retailer, plans to implement WMS and Voice Picking at its facilities
Celsur, a third party logistics provider, has chosen WMS for its Buenos Aires distribution center
"We understand that technology will play a key role in the growth plans and success of our organization," said Marcelo Ormachea,
Operations Manager from CELSUR Logistica.
"We are certain that the experience acquired by RedPrairie in its collaboration with the world's leading 3PL's will provide us with more
flexible and scalable advantages to our expanding business," said Francisco Alvarez, CEO of CELSUR Logistica.
"Nowadays the logistic providers sector (3PL's) demands real time information as well as broad controls, traceability and flexibility among
the services provided to its customers. RedPrairie offers a solution especially robust for logistics providers that combines all these advantages,
with differentiated configurable options to service each customer. In addition, its billing capabilities enable us to assure and surpass the
expectations of each one of them," said Jesus Lara, CIO from Accel Logistica.
CELSUR GROWS AND RECEIVES AWARD
Francisco Alvarez, Executive Director of the company, said that in 2007 they will grow by 15 percent and is expecting further expansion in the
coming years.
Celsur Logistics, a company leader in the sector will grow in 2007 by 15 percent and expected growth rates higher for the next few years,
after having made a recomposition of shares and renewed its line management, and after having received an international award for the
multinational automotive General Motors said its executive director, Francisco Alvarez.
"Celsur has seen significant growth this year and is expected to increase even further in the coming years ahead. This year grew by 15 percent
and we believe to grow well over the next year," said Alvarez in statements to Radio Transportation program that is broadcast on Radio Culture
of Buenos Aires.
The management attributed the expansion of the firm to increased logistics activity, but above all to "a recomposition shares and a
repositioning in the market, with input from investment and the formation of a new management team, which has passed its first stage
accompanying a moderate growth to move into the second phase much more intensive."
Consulted on the overview of logistics activity, he argued that "the industry is, as whole economy, very defendant, in addition to strong
tensions in costs."
"It's an area that was heavily beaten by the crisis, and that at the time could not pick up any of the costs that the crisis it entailed, and has
consequently low ability to absorb costs instrumental that is taking, and that the future is going to be subjected to some and emerging cost
18th Edition
18th Edition
31-20-500-7000
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Global
Transport
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
Very good, tier 1 global LLP and supply chain manager with strong freight forwarding capabilities.
KEY PERSONNEL
John Pattullo
CEO
Rubin McDougal
Peter Dew
CFO
CIO & Group HR Director
7,637
Ticker Symbol
7,637 **
Exchange:
46,246
1,350
1-3
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
88
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Matrix, i2 Technologies
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Radical CAST
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ABB
Industrial Machinery
ADI
Specialty Retailers
Amdahl
Arelik
ArvinMeritor
Bayer MaterialScience
Chemicals
Spain
Europe
Italy, UK
Bonfiglioli Riduttori
Italy
Caltex Australia
Petroleum Refining
Australia
Carrefour Brazil
Brazil
Latin America
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Spain
Turkey
Europe
North America
Latin/South America
Afghanistan
Australia
Austria
Canada
Iraq
Jordan
Brunei
Guam
Belarus
Mexico
Cambodia
New Zealand
Belgium
United States
Argentina
Bolivia
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Jamaica
Nicaragua
Panama
Paraguay
Peru
Uruguay
Venezuela
Oman
Bulgaria
China
Saudi Arabia
United Arab Emirates
Yemen
Australia/New Zealand
CEVA
Egypt
Africa/Middle East
Asia/Pacific
Hong Kong
Croatia
Czech Republic
Indonesia
Denmark
Japan
Estonia
Korea
Finland
Malaysia
France
Mongolia
Germany
Myanmar
Greece
Philippines
Hungary
Singapore
Ireland
Taiwan
Italy
Thailand
Latvia
Vietnam
Lithuania
Moldova
Netherlands
Poland
Portugal
Romania
Slovakia
Spain
Sweden
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
CEVA Logistics is one of the worlds largest logistics companies and is also the worlds largest automotive 3PL.
It has a heavy emphasis on manufacturing and is expanding operations in other sectors. CEVAs industry sectors
are Automotive 28%, Technology 24%, Consumer/Retail 17%, Industrial 14%, Energy 5% and Other 12%.
CEVA Logistics operates in 100 countries. The CEVA operations we have visited get top marks. CEVA is very
good at value-added support activities. Its Matrix software suite reflects its range of logistics capabilities,
including materials management. CEVAs core services include fulfillment centers, high-velocity cross-docks, subassembly modularization, dedicated contract transportation, and network designs/redesigns. Contract Logistics is
57% of its revenues and Freight Management is 43%. The Americas account for 29% of its revenues, Northern
Europe 25%, Southern Europe, Middle East and Africa 23% and Asia Pacific accounts for the rest.
Private equity owner, Apollo Management, acquired EGL Eagle Global Logistics which has been rebranded as
CEVA Freight Management. EGL adds global freight forwarding to match CEVAs high quality value-added
warehousing, materials management and other contract logistics capabilities.
In 2008, CEVA introduced its Century Partnership Account Program for 100 of its key customers selected by its
Executive Board. These accounts have a global scope and represent more than half of CEVAs total business.
Provider's Strengths
Automotive logistics, value added services, global reach, profitability. Most cohesive of global LLPs.
Provider's Weaknesses
Burden of paying off private equity owners saps capital for business improvements.
Key Personnel:
David Kulik, CEO
Russ Dixon, Sr. Manager of Marketing & Communications
Keith Goldsmith, Sr. VP of Business Development & CIO
Marc Chrencik, Contract Manager
Terry Haber, Dir. of Sales & Marketing
CEVA is one of a handful of global supply chain management 3PLs. Most of its customers are among the worlds 200 largest companies.
For them, CEVA provides a broad range of services. These services often start with demand planning. That is, the customer has given CEVA a
schedule of what, how much, where and when product is needed. CEVA then notifies the producing vendor, monitors global transportation
movement, manages handoffs of the product and manages the delivery to the proper destination in North America, Europe or Asia at the time
18th Edition
required.
Strategic relationships are essential for CEVA's global materials management. To make these supply chains work requires sophisticated IT
and telecom capability, sufficient personnel strength around the world and in-depth knowledge of the customers business. That is, to manage
global supply chains as CEVA does, requires scale. The 3PLs who have this scale are multi-billion dollar transnational operations. They are
citizens of the world.
CEVAs scale includes 567 warehouses and distribution centers with 72 million square feet of space, 7,908 vehicles and 38,000 employees.
CEVA has 1,200 contracts and $4.6 billion a year in revenue.
For comparison, GENCO, a well known North American value-added warehousing company and industry leader in return logistics, has 94
warehouses with over 30 million square feet, 6,000 employees, 50+ contracts and $571 million in revenues. GENCO is a very good 3PL, but it
does not have the scale to do global material management.
CEVAs IT excellence revolves around its globally linked network of locations using a web-based global event management system (GEMS),
a robust order/transportation management system, a Tier 1 warehouse management system and a host of supporting IT. Visibility is available
by order, shipment, SKU, truck route, warehouse location, country, event or yard location to name a few.
The key logistics management programs are in Jacksonville, Florida. They are fed data by global frame relay systems. The order
management, TMS system incorporates and extends i2s rate library and optimization tools. The multiple location WMS systems are Manhattan
PkMS (U.S.) and RedPrairie (Europe). The name for the combined technology solutions is Matrix.
Additional global data centers for the CEVA network are in Singapore and Amsterdam. The system backup center is in a specially fortified
CSX building in Jacksonville.
Slightly less than 20% of CEVAs business is in North America. Over 60% is in Europe. The remainder is in Asia and the rest of the world.
An advantage and strength of CEVAs scale is the amount of intellectual capital it holds. Innovations and improvements occur more often
because more people in a stimulated corporate culture are looking for them. In the long run, many heads are better than one.
CEVAs innovation manifests itself in its sales. The strategic Development Process is a proactive sales approach. The approach gives
customers a structured high-level, consultation about these operations. The process begins with an overall capabilities meeting followed by a
white board session in which a high level look at the customers supply chain and opportunities for improvement are discussed. Two to three
weeks after the white board session the customer is given a diagnostic report. Charges for this consulting process are minimal.
CEVA absorbs the cost and benefits from business improvements and good will. This free consulting service is limited to customers who
have significant revenue potential. This practice is in keeping with CEVAs emphasis on large, global accounts.
Like its global supply chain competitors, CEVA has a dozen or so accounts with more than $50 million per year in revenue. That scale and
customer portfolio attracts a host of potential owners in todays private equity rich markets.
CEVA was recently purchased by Apollo Managements London office for $1.7 billion. The debt service portion is about $500 million.
CEO Dave Kulik told us CEVA is managing its debt service well. Growth and EBITDA improvement are expected. We surmise that
Apollo will resell or take CEVA public in five years or so, making money primarily off growth and margin improvement.
For help with future challenges, Kulik has bolstered business development. Keith Goldsmith, who built the information network with its
high level SCM components, has been promoted to Senior Vice President of Business Development. It is an interesting world in which the
information management chief is the best qualified to make commitments to customers concerning their global needs.
A Conversation with Cynthia Cochovity, Senior Vice President, Global Business Development, CEVA Logistics
16, Issue 1, 2010]
LQ: How have you dealt with the onslaught of information that commands your attention every day? Two or three timesaving tips would be
helpful.
Cynthia Cochovity: This is an ever increasing challenge and one that can get the best of you if you let it. Prioritizing is essential but not
always enough. More often than not the "high priority" information is tough to rank, so one must force diligence to identify the impact and the
urgency of action required. Always tackle the difficult and complicated items first while you're fresh and the day's surprises have yet to hit the
radar.
LQ: How did you choose logistics as your profession? Would you encourage other women to seek their careers in this industry and what's
your advice?
Cynthia Cochovity: As part of college coursework, I took classes in international business and exporting. At the time it was all quite a mystery
and one of my professors suggested I explore internships in the field of international logistics. This lead to being hired upon graduation by a
small Swiss freight forwarding company - the rest is history. I would encourage other women to seek careers in this industry. Global trade and
exposure to the dynamics of worldwide supply chain necessity is full of endless opportunity.
LQ: What role does corporate culture play in hindering or hampering a woman's rise to leadership positions? How can fellow women help
change corporate culture to be more female-friendly?
Cynthia Cochovity: Corporate culture plays a critical role. It sets what I would call the template or foundation in development and
identification of opportunities for women.
However, I'm a firm believer that fellow women in leadership positions must be allowed to take a larger role in presenting innovative femalefriendly solutions. It's the key to targeting the efforts appropriately and achieving the best possible results.
LQ: What skills have you developed and relied upon to succeed in a male dominated industry?
Cynthia Cochovity: Having only brothers, I grew up in a "boys club" environment.
This from a young age exposed me to relationships and competitive situations where the idea of special treatment for being "the girl" just
didn't exist. In business and in life, respect for the individual and appreciation of talent or value rather than a focus on gender or nationality has
been a natural gift. While not always easy and certainly a challenge in our male-dominated industry, it gives me the balance I need to face each
situation with minimal distraction.
LQ: What one word would most people use to describe your leadership style?
Cynthia Cochovity: Coach.
LQ: How does it feel to sometimes be the only woman in the room?
Cynthia Cochovity: This is an all too common occurrence. Some would think it an uncomfortable situation, but I find myself more curious
and I immediately think through the dynamics, especially when dealing with other countries and cultures. Being outnumbered typically
diminishes as the discussions develop and the focus on the subject matter takes over.
CEVA wins 30 million contract to streamline Triumph Motorcycles supply chain
Ashby-de-la-Zouch, UK, 14 July 2010 CEVA Logistics, one of the worlds leading supply chain companies, has signed a three year contract
18th Edition
worth 11 million per annum with Triumph Motorcycles, the iconic British motorcycle manufacturer which produces 50,000 motorcycles a
year.
CEVA will work in partnership with Triumph to streamline, integrate and optimize their international logistics flows of components,
accessories and finished motorcycles. The logistics operator will handle the ocean shipment of motorcycles and the movement of components
from suppliers in Asia and Europe to Triumphs global manufacturing network.
Key to the successful partnership will be CEVAs Ocean Plus solution which will deliver comprehensive management of product movement
from order placement to final delivery. CEVAs Ocean Plus team will provide global visibility and control of over 50,000 purchase orders per
year from more than 380 suppliers. The management of component supply against key milestones is critical to ensure production lines are fed
while stock levels are optimized.
The Ocean Plus solution CEVA is deploying will facilitate Triumphs growth plans by providing a scalable solution across multiple
geographies and modes of transport. CEVA will be combining purchase order management, vendor compliance and optimization programs to
deliver a truly efficient, reliable yet dynamic solution for Triumphs international transportation.
Leigh Pomlett, CEVAs Executive Vice President, UK, Ireland & Nordics said: We are delighted that Triumph has chosen CEVA as their
logistics partner. Our Ocean Plus solution was one of the key elements that motivated Triumph to select us. A flexible and scalable logistics
solution, supported by our integrated and end-to-end capability, and our ability to flex modes of transport to meet dynamic delivery dates is
critical to ensuring that Triumph can respond quickly to take advantage of changes in the market.
Cevas five-year deal from Janssen
Ceva Logistics is to manage a new European distribution centre in La Louvire, Belgium, for Janssen Pharmaceutica, under a new five-year
contract.
The 30,000sq meter facility will store close to 4,000 pharmaceutical products, both human and veterinary, for delivery to customers across
Europe and affiliates around the world.
The new site will be managed by Ceva alongside an existing distribution centre for medical devices in Courcelles.
CEVA acquires Italian pharma supply chain specialist
CEVA Logistics has entered the pharmaceutical market in Italy with the acquisition of DIMAF Pharma Supply Chain.
Active in the pharma logistics sector for more than thirty years, DIMAF is among the top five in pharmaceutical logistics in Italy, and
manages the supply chains of about thirty pharmaceutical companies, including several multi-nationals.
DIMAF is present throughout Italy with three temperature-controlled warehouses in the Lombardy and Lazio regions, with a total area of
35,000 m2.
DIMAF offers also services of Officina Farmaceutica' - areas that meet specific standards in terms of sanitary regulations and good
manufacturing practices, with highly experienced personnel dedicated to value added services.
The terms of the transaction have not been disclosed.
CEVA wins contract with BMW
CEVA Logistics has signed a three year agreement with BMW Italia S.p.A. for the operation of the new Dealer Metro Distribution Center
(DMDC) in support of its dealers in Lombardy and Piedmont.
CEVA will manage original BMW and MINI spare parts in the new DMDC, a logistics platform covering 3,100 sq m in Albairate in the
province of Milan. The warehouse is in a different area from the Regional Distribution Center of Volargne, in the province of Verona, and will
resupply the BMW and MINI dealers in Lombardy and Piedmont.
In order to guarantee immediate response to the dealers' requests, CEVA will carry out up to three shipments to each dealer, per day. The
base to the west of Milan is strategically positioned in a central location and offers the ability to provide the same level of service to dealers in
the north of Milan and to those in Piedmont.
Gianfranco Sgro, President of CEVA in Southern Europe, Middle East and Africa, said: "We are proud to be using our experience to
maximize the efficiency of BMW's supply chain. Profiting from CEVA's global network we benefited from the experience acquired by CEVA in
the UK, where we have been operating two Dealer Metro Distribution Centers for BMW for some time. Thanks to the efficiency of our
distribution solutions, BMW Group Italia will be able to guarantee its agents an extremely punctual and rapid delivery of urgent supplies, while
optimizing transport costs. We look forward to another long and productive relationship with BMW here in Italy."
Ceva signs six-year contract with Messaggerie Libri
Ceva Logistics has signed a six-year agreement with Messaggerie Libri, a distributor of books in Italy.
The contract win will see Ceva managing the publishing warehouse and logistics for the launch of new titles in all national bookshops
resupplying distribution centers in Milan and Rome, as well as undertaking basic accessory tasks such as kitting, labeling, wrapping in cellophane
and the management of returns. Each year Ceva will process over 30 million items for Messaggerie Libri.
Massimo Berti, global sector director of publishing at Ceva, said: "We are proud that Messaggerie Libri has chosen to continue its
collaboration with Ceva. This is a further step on the road to the consolidation of our leadership in the Italian publishing sector.
"Through our highly specialized services and ability to manage considerable volumes of items, Ceva is able to guarantee an excellent service at
competitive rates, characterized by integrated processes across the various phases of the supply chain."
18th Edition
852-2827-1670
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Transportation/Shipping
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Lau Pak Shing
GM
Tommy Chan
Grace Lin
Stephen Chan
Liao Xiang
CFO
Deputy GM
527
47 **
Exchange:
3,116
HKEX
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
3.3
Total Other:
Total Trailers:
Total Aircraft:
20
Total Ocean:
23
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
Healthcare
Industrial
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): MK Logistics
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Logistics WMS
18th Edition
MK Logistics
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Abbott Laboratories
Pharmaceuticals
Hong Kong
BOC Travel
Commercial Banks
Hong Kong
Caf de Coral
Food Services
Hong Kong
Campbell Soup
Hong Kong
CR Retail
General Merchandisers
Hong Kong
CR Vanguard
Hong Kong
DHL
Hong Kong
General Motors
Hong Kong
Hagen-Dazs
Hong Kong
Advertising, Marketing
Hong Kong
Jingdi Paper
Hong Kong
Maxim
Publishing, Printing
Hong Kong
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
China Resources
North America
Latin/South America
China
Hong Kong
EDITOR'S COMMENTS
The multiple operations of the parent company have revenues of $9 billion per year. About 500,000 TEUs per
year are handled. Value-added services are extensive in Yuen Fat operations.
Provider's Strengths
Broad approved Peoples Republic of China operations.
Provider's Weaknesses
November 1995, Huarun Dadong Dockyard Co., Ltd was established as joint venture with Shanghai Hudong Shipbuilding Co., Ltd with total
investment RMB200 Million;
1990's, Purchased and owned hundreds thousands tons of bulk-cargo vessels;
1990's,set up several joint ventures in Hong Kong and Mainland;
September,1987, Yuen Fat Wharf and warehouse was constructed ready for the use of transit cargo ex. Mainland;
Since 1985, Purchased and traded 170 barges and feeders as representatives of domestic shipping companies;
1985, became a member of China Resources Group;
Prior to 1985, as Hong Kong subsidiary and general agent of Sinotrans;
December 07,1984, Yuen Fat Wharf & Godown Co, Ltd was set up;
February 1984, China Resources Transportation & Godown Co., Ltd was set up to intensify warehousing service;
1970's-90's, As general agent of domestic shipping companies to issue "Farenco Ocean Rate Paper" by negotiating rates with foreign ocean
carriers;
1977, The First Company to introduce rail-sea intermodal transportation for transit cargo ex. China;
1972, The First Shipping Company of China was ever registered and approved by FMC of USA;
1963-1987, Exclusive general agent of Sinotrans in Hong Kong with handling 2 million freight tons of transit cargo via Hong Kong;
1963-1964, The year of water fierce deficiency in Hong Kong (water supply 4 hours per day), as exclusive shipping agent of 34 feeders to
transport water from Guangdong Province;
1957-1971, Totally owned 27 ocean vessels with 300,000 DWT,and handed over these vessels to join COSCO in 1971;
1950's, Rented 180 foreign vessels reaching 1.4 million DWT;
1949, Far East Enterprising Co.,(H.K.) Ltd was established, that was initial company of current CRC Logistics.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2001
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Fang Mandi
CEO
Gan Jianjun
Xiong Ming
Marketing Mgr.
Logistics Mgr.
Zhu Ping
Wang Zhonghua
CFO
CIO
Ticker Symbol
350
60 **
1,200
1,000
1-3
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
2.153
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Cargo 6
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
Proprietary--Cargo 6
Proprietary--Cargo 6
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Publishing, Printing
Shenzhen
Computer Peripherals
Shanghai
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Shenzhen
Asia/Pacific
Europe
North America
CHINATRANS
Latin/South America
China
Philippines
Singapore
Thailand
EDITOR'S COMMENTS
CHINATRANS owns 28 branchs located in Central and Southwest China, including major ports in China, and in
Southeast Asia.
Provider's Strengths
Ocean freight.
Provider's Weaknesses
18th Edition
86-755-33958201
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Yang Yi Ping
Hui Huang
Ticker Symbol
120
20 **
400
10
1
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
200
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
40
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
CUSTOMERS
18th Edition
Asia/Pacific
Australia/New Zealand
Europe
Latin/South America
North America
Asia/Pacific
Europe
North America
China
Canada
Hong Kong
United States
City Ocean
Latin/South America
Malaysia
Vietnam
EDITOR'S COMMENTS
City Ocean is a large, Chinese-run freight forwarder with expanding capabilities; it is benefiting from the world's
fastest growing economy. It has a good Internet-based technology platform and aggressive, young management.
Provider's Strengths
Ocean freight forwarding and related transportation.
Provider's Weaknesses
18th Edition
65 6264 0790
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1970
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
Good NVOCC and contract logistics company with modern skills and chemicals specialization.
KEY PERSONNEL
Loi Pok Yen
Group CEO
375
50 **
4,000
Exchange:
SGX
ASSETS
Total Transportation Assets:
Total Tractors:
80
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
400
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
8.5
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): CWT iDASH, CWT iSCM
Transportation Planning and Optimization:
Warehouse Management System (WMS):
18th Edition
CWT iSCM
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Borouge
Chemicals
DuPont
Chemicals
Minebea
Wholesalers: Diversified
Tomoe Shokai
Volex
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Singapore
Asia/Pacific
Europe
North America
Belgium
United States
Egypt
China
Ghana
Kuwait
India
Germany
Indonesia
Netherlands
Malaysia
Spain
Australia
CWT
Latin/South America
Ukraine
Pakistan
United Kingdom
Singapore
South Korea
Sri Lanka
Thailand
Vietnam
EDITOR'S COMMENTS
CWT is growing its integrated services and distribution operations. CWT has a strong competency in chemical
logistics. Its NVOCC operations account for 41% of its revenue, contract logistics 46% and its engineering
maintenance operations account for the rest. About 65% of its revenue is Singapore and China based. CWT has
six million square feet of warehouse space in Singapore. The rest is in EMEA and Asia. Its U.S. location is in New
Orleans.
Provider's Strengths
Chemical logistics.
Provider's Weaknesses
Limited to niche offerings.
While the logistics industry has taken a hard beating by the lagging economy, CWT is bucking the trend by looking for approximately 100
new employees. According to Eric Herman, CEO for logistics business of CWT, the company will soon need approximately 100 more staff by
mid-year 2010. While 80% of the jobs would be predominantly blue-collar jobs in the warehouse and trucking areas, there are also roles for
technicians, engineers and a customer service team.
Borouge South East Asia (SEA) logistics hub in Singapore
Borouge, a leading provider of innovative, value creating plastics solutions, has today signed a service contract with CWT Logistics Pte. Ltd.,
Singapore, so as to establish the Borouge South East Asia (SEA) Logistics Hub and to provide local logistics services for Borouges customers in
Asia for duration of 10 years with effect from its operational start-up date in 2010.
18th Edition
Following the contract win, CWT Logistics will undertake the design, development and construction of a Packaging Facility, together with
providing dedicated existing state-of-the-art Warehouse Facilities at the Singapore Commodity Hub for the storage of Borouge Products.
In addition to the storage facilities, CWT Logistics will also be providing packaging services and an integrated container depot so as to handle
a total annual volume of approximately 330,000 tonnes of polyoleofins dispatched by Borouge from Abu Dhabi in the United Arab Emirates
(UAE) to the South East Asia (SEA) logistics hub.
Abdulaziz Alhajri, CEO of Borouge Abu Dhabi Polymers, the manufacturing company, explained: The South East Asia logistics hub is the
third (3rd) logistical hub to be awarded by Borouge in the Far East. The hubs will provide storage and logistics support for our operations close
to our customers. It will enable us to provide a fast, flexible delivery service to our customers, for all of Borouges high value product lines,
especially more so for our customers in South East Asia, Australia and the surrounding regions as Singapore represents an unrivalled transshipment hub in the Far East.
Mr. Alhajri adds: With CWT Logistics being an established long term Logistics provider in Singapore, having a strong knowledge of the
region and the local logistics market, Borouge in turn view this award of Services as a very positive step forward in Borouges growth in South
East Asia / the Far East and similarly see this growth being enhanced by CWTs capabilities as a partner in this endeavor.
Eric Herman, CEO of CWT Logistics noted: At CWT Logistics, we continually strive for service excellence through our people, our welldesigned processes and our professionalism. We are able to generate synergies from the various expertise within the Group so as to arrive at a
solution that is efficient, cost effective and tailored to our partners. For the Borouge South East Asia (SEA) / Singapore Logistics Hub, CWT
combines its extensive network, strong supply chain knowledge and innovation of warehousing to provide the most robust solution for Borouge
to meet their future growth plans by bringing them closer to their markets and delivering a best in class service to their customers in the region.
Borouges current production capacity in the UAE is 600,000 tonnes of Borstar polyethylene per year. With the ongoing Borouge 2 project
expansion, this capacity will increase to 2 million tonnes per year by the middle of 2010 and will add polypropylene to the product mix.
Construction of the Borouge 2 facility has already started and consists of a 1.5 million tonnes ethane cracker, the worlds largest olefins
conversion unit (with a capacity of 750,000 tonnes), two Borstar polypropylene plants with a total capacity of 800,000 tonnes and a 540,000
tonnes Borstar polyethylene plant.
Singapore Logistics Giant to Grab a Slice of the US$250 billion potential
CWT expands local warehouse capabilities to tap into the booming global 3PL market
Singapore, 12 March 2008 With Asias rising trend in developing logistics infrastructure, local logistics giant, CWT Limited takes the lead in
the region with a total investment of more than S$80 million into two highly integrated logistics hubs. Officially launched today by Mr. Lim Hng
Kiang, Minister for Trade and Industry, the ceremony, held at the companys headquarters in Tanjong Penjuru, was attended by customers,
industry partners and various government and trade bodies. In Asia, investment in transportation infrastructure (including ports, logistics and
container terminals) is developing rapidly with industry estimates noting exponential growth in North-East Asia alone. (Source: United Nations,
Economic and Social Commission for Asia and the Pacific report.)
The Singapore government is committed to the future of the logistics and supply chain industry. We want this industry to be best-in-class
and stay ahead of the curve. This will allow us to capture the huge growth opportunities in Asia, said Minister Lim Hng Kiang.
Our local 3PLs such as CWT, YCH, Freight Links have been able to establish a brand-name for themselves within the region too. Blue-chip
companies such as BASF, Motorola and Dell form the base of their customers whom they service regionally, and I am very heartened that these
local 3PLs continue to leverage on Singapore as their home base to expand and develop new businesses overseas, he said.
Since 2005, CWT has committed a total investment of more than S$300 million in developing its local and overseas logistics infrastructure of
which about S$240 million is invested in Singapore. Being one of several logistics infrastructure development projects CWT is pursuing,
Logistics hubs 1 and 2 reflect the companys objective in taking substantial steps to tap into the US$250 billion Global 3PL market (Armstrong
and Associates, 2007).
Incorporating the latest in technology, CWT Logistics hubs 1 and 2 are fully equipped with enhanced storage facilities and features for
specialized materials handling. With nearly 1 million sq ft of warehouse space and the close proximity to port terminals, these hubs are set to
provide a more comprehensive and extended support to customers operations in the region and globally.
According to Mr. Loi Pok Yen, Group CEO, CWT Limited, The APAC market for logistics is projected to grow at a CAGR of 13% from
2005 to 2009, making Asia an emerging powerhouse to reckon with. With Singapores status as a vital global hub and the increasing importance
of this industry to our economy, there will be ample opportunities for local companies like us to expand.
Singapore was ranked as the No. 1 logistics hub in a World Bank shipping survey last year and plays host to 21 of the world's top 25 third
party logistics players.
With the stiff competition from major global industry players, CWT is aggressively pushing forth with plans well underway to enhance
existing capabilities and infrastructures to keep ahead of the global markets needs, said Mr. Loi.
CWT Limited has posted profitable growth in 2007 with a revenue hitting S$ 535 million crossing the half billion mark and 31 per cent rise in
net profit to $37.14 million
The company manages more than 4 million sq ft of warehouse space in Singapore and the region with an additional 3 million sq ft coming on
stream by mid 2009.
CASE STUDY - Electronics Logistics
The appointment of CWT was with due consideration for their global network presence in the Asia region. We will continue to strive to work
closely with CWT to enhance our delivery response time to customers, said Mr. SS Ng, Regional Materials Manager of Volex.
The Volex Group, one of the world's largest suppliers of electrical and electronic cable assemblies, has a strong presence in the Asia Pacific
region through its subsidiary, Volex (Asia) Pte Ltd. Volex provides global support to producers of computers, telecommunication systems and
networking devices. It builds cable assemblies for vehicles, consumer electronics and appliances, and the defense and aerospace industries. The
company is recognized around the globe for its quality power cords and interconnect cable assemblies. CWT a Leading Logistic Service Provider
with a team of IT Specialists and Logistic Engineers who continually re-engineer and re-conceptualize logistic business processes to meet
customers needs collaborate closely with Volex to gain total synergy and control over its supply chain.
With its network of global alliances, CWT co-ordinates the consolidation of raw materials and distribution of finished goods to ensure on
time delivery at the least cost for the total supply chain as a whole. CWTs iSCM is able to track the total inventory visibility and cargo
movement via internet and to facilitate accurate decision making during critical time on behalf of Volex.
Through this partnership, Volex also benefited:
18th Edition
18th Edition
49-6122-50-1300
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1998
Asset Focus:
Market Area:
Founding Business:
International
Supply Chain Management
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Andreas Bargende
CEO
Diego Parra
Detlef W. Hbner
Tammo Fey
CFO
337
337 **
Exchange:
3,168
20
1-8
Frankfort
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
7.1
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ABB
Industrial Machinery
Germany
Textiles
Europe
Agilent Technologies
Europe
Alstom
Industrial Machinery
Germany
Audi
Germany
Beiersdorf
US
Binda
Italy
Candle-Lite
Specialty Retailers
US
Chanel
Apparel
Dell'Orto
Dr. Schr
Duracell
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Italy
US, Europe
Asia/Pacific
Australia/New Zealand
Europe
North America
Austria
United States
D.Logistics
Latin/South America
Belgium
Czech Republic
France
Germany
Italy
Slovakia
EDITOR'S COMMENTS
D.Logistics AG combines consumer goods and industrial goods packaging and warehouse logistics. Consumer
goods packaging is provided in Europe and the U.S. Industrial goods packaging is in Germany. Warehouse
logistics activities are in Central Europe.
D.Logistics likes to replace company operations in customer facilities. D.Logistics sources, packages,
warehouses, and distributes.
The company has returned to profitability and looks solid.
Provider's Strengths
Packaging and warehouse logistics.
Provider's Weaknesses
D.Logistics subsidiary, Deufol Tailleur, has strengthened its position in Europe with the acquisition of the Logis Group.
The Logis Group comprises Logis prmyslov obaly (Ivanice, Czech Republic), Logis priemyseln obaly (Kruovce, Slovakia) and Logis
Industriedienstleistung (Tulln, Austria).
The purchase price of 6.5 million is fixed, with a further payment of up to 2.5 million conditional on the sales and earnings development of
the companies between 2007 and 2009.
In April 2007, Deufol Tailleur strengthened its domestic position in Germany with the acquisition of the Walpa group. The Logis deal is in
line with Deufol Tailleurs growth strategy to expand the industrial goods packaging into foreign countries.
The Deufol Tailleur group represents D.Logistics in the industrial goods packaging segment, with revenues of 107 million in the first nine
months of 2007.
The Logis group is expected to achieve sales of around 10 million in 2007.
D.Logistics AG records highest net profit in company history
competencies. With 35 fully consolidated companies and further associates D.Logistics will continue the expansion of the group.
Outlook
For the current year the D.Logistics group expects sales between 315 and 327 million and operating earnings (EBITA) between 11.1 and
12.2 million. Intended divestments are not part of this plan, but they could influence the earnings positively. The targets for 2008 are an increase
in turnover between 3 and 7% and a raise of the EBITA margin to above 4%.
The planning does not include the recent acquisitions in the Industrial Goods Packaging segment with an annual turnover of around 6
million. In addition for the further strengthening of the packaging operations acquisitions with a sales volume of up to 15 million are under
consideration.
D.Logistics AG: Industrial Goods Packaging strengthens its position by acquisitions
Deufol Tailleur GmbH, a 55% affiliate of D.Logistics AG and simultaneously the steering company of the Industrial Goods Packaging
segment has strengthened its position by acquisitions. It bought in each case a 100% interest of Walpa Gesellschaft fr bersee- und
Spezialverpackung mbH & Co. KG (www.walpa.de), LTP Logistic und Technik GmbH and Fischer Kisten GmbH. Together these companies
recorded a turnover of around 6.1 million in 2006.
The purchased companies render similar packaging services as the Deufol Tailleur Group. Therefore these transactions are an important step
for the positioning and regional expansion in the southwest of Germany. The intention is to merge the operations in the south-west and to
expand and optimize the production area.
The seller will in future not only act as a general manager of these companies but he will bring his specific industrial engineering know-how
to all our Industrial Goods Packaging companies to support the already initiated steps for further process optimization and efficiency increases.
Theses transactions document the focus of D.Logistics group to be a strong and specialized partner for industrial goods packaging.
Therefore further acquisitions are possible.
D.Logistics downgrades profits forecast
D.Logistics, the acquisitive German contract logistics operator, has released its results for the third quarter of 2003, as well as re-appraising
its full year forecasts. The company posted revenue figures of 78.6m euros, a reduction of 4.6% compared with the same quarter last year.
However operating profit (EBITA)w as 1.6m euros, a major improvement on the 9.2m euros loss in 2002.
Although the results are encouraging for the company, which severely over-reached itself financially through a highly aggressive acquisition
programme, development is not progressing at the rate at which management had hoped. In particular its Consumer Goods Packaging segment
is unlikely to meet its budget for the full year. Partly as a result of this, full year profits have been downgraded from 13.2m euros to 5m euros.
Overall the management of the company is optimistic that the economic recovery in Europe and particularly in Germany is underway. This
will have generally ameliorative impact on all of D.Logistics operations, compounding the benefits of its re-structuring programnme. For the
current year, on sales of approximately 315m euros, management expects an operating profit of around 5m euros. Revenues are expected to
grow organically by 5% in 2004.
D.Logistics
Formerly known as Donne+Hellwig GmbH & Co. KG, the company has grown from a German based warehousing company to a major
European player across a range of freight and logistics competences with a turnover of 484m in 2001. In 1998, when it decided to expand
internationally, the company re-branded itself as D.Logistics and embarked on a major acquisition program.
D.Logistics built a presence in five key market segments: airport services; consumer goods; packaging technology; chemical and automotive.
Its acquisitions have allowed it to build capabilities and presence although after these acquisitions the company faced difficulties with the
integration of its new subsidiaries. This, combined with the economic downturn in its core markets, led to a loss of profitability, and
indebtedness which the company fround impossible to manage without fundamental changes. This led to the sale of one of its major
acquisitions, Cargo Service Center (CSC), an airport ground handling operator, which it had only acquired a year previously. The original
shareholders took over the running of the company and dismissed many of the board members in an attempt to return the company to
profitability.
The problems faced by D.Logistics demonstrate the dangers of embarking on an ambitious acquisition strategy without the necessary
strength of management or the financial resources to ensure that new subsidiaries are properly integrated.
D.Logistics says will sell low margin divisions
FRANKFURT, March 6 (Reuters) - Ailing German airport cargo handler D.Logistics said on Wednesday it would sell its low-margin
divisions to reduce its debt that nearly brought the company to its knees last week.
The announcement follows last week's management shake-up that helped stave off a looming cash crunch as the company struggled to
absorb the costs of a recent acquisition spree.
Shares in D.Logisitics, which have shed 98 percent of their value from a peak of 110.50 euros in August 2000, were the sharpest gainers on
the Nemax 50 by 1228 GMT, rising 12.1 percent to 2.69 euros.
"The objective of the new company orientation is to streamline the business sectors. In doing so the cyclical divisions with lower margins will
be sold," the company said in a statement.
No company officials were immediately available for further comment. The firm said last month a new board of executive directors intended
to "vigorously consolidate" its activities in 2002.
"My guess is that they will probably sell their CSC air cargo unit. Also a sale of the logistics unit Infraserv is possible," said HVB analyst
Markus Hesse, who has a sell recommendation on the stock.
"But it will be difficult to find a buyer at a suitable price. Focusing on the core business is certainly the right step," Hesse added.
The company said last Tuesday it had the backing of its creditor banks as it ran out of money. It said its liquidity crisis was over, as was the short
tenure of former Chief Executive Ernst Gumrich, who was sacked along with two other board members.
One of the firm's founding shareholders Detlef Huebner took over the role as chief executive.
"The return of the company founder and majority shareholder Detlef Huebner is to demonstrate to the capital market that the majority
shareholder is still fully involved with the company and has not disposed of any company shares, contrary to rumors on the market,"
Wednesday's statement said.
18th Edition
49 831 5916-8-1370
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1930
Asset Focus:
Market Area:
Founding Business:
International
Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
Aggressive, modern, major European warehousing and distribution specialist with a retail vertical emphasis.
KEY PERSONNEL
Bernhard Simon
Michael Schilling
Thomas Reuter
4,504
Ticker Symbol
3,600 **
Exchange:
17,500
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
7,665
Total Other:
Total Reefers:
Total Flatbeds:
11
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--DOMINO, Active Reports; Procars
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--MIKADO
18th Edition
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Food Production
Europe
Clariant
Chemicals
Europe
Huhtamaki
Packaging, Containers
Europe
tesa AG
Manufacturing
Poland
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Algeria
Bangladesh
Australia
Albania
Canada
Bahrain
Cyprus
Cambodia
New Zealand
Armenia
Mexico
China
Austria
United States
Georgia
Belarus
Argentina
Brazil
Chile
Colombia
Costa Rica
El Salvador
Guatemala
Peru
Trinidad and Tobago
Uruguay
Venezuela
Africa/Middle East
Egypt
Iran
Asia/Pacific
Australia/New Zealand
DACHSER
Belgium
India
Isreal
Bosnia-Herzegovina
Jordan
Kuwait
Indonesia
Lebanon
Kazakhstan
Morocco
Korea
Oman
Qutar
Kyrgyzstan
Bulgaria
Japan
Croatia
Czech Republic
Denmark
Estonia
Malaysia
Finland
South Africa
Myanmar
France
Syria
Nepal
Germany
Tunisia
United Arab Emirates
Pakistan
Great Britain
Philippines
Greece
Singapore
Hungary
Sri Lanka
Iceland
Saudi Arabia
Ireland
Taiwan
Italy
Tajikistan
Latvia
Thailand
Lithuania
Turkmenistan
Luxembourg
Uzbekistan
Macedonia
Vietnam
Malta
Moldova
Netherlands
Norway
Poland
Portugal
Romania
Russia
Serbia and Montenegro
Slovakia
Slovenia
Spain
Sweden
Switzerland
Ukraine
EDITOR'S COMMENTS
Dachser handled 42 million shipments in 2009. Its largest business segment, Dachser European Logistics,
accounted for 67% of revenue in 2009. Its other business segments include Dachser Air & Sea Logistics which
accounted for 17% of revenue in 2009 and Dachser Food Logistics, a specialist in warehousing and distribution in
the temperature-controlled, non-frozen food segment in Germany, accounted for the rest. Nearly 60% of Dachsers
17,500 employees are based in Germany. Dachser tends to be more modern and aggressive than many of its
competitors.
Provider's Strengths
European distribution.
Provider's Weaknesses
Unifine Food & Bake Ingredients GmbH is continuing to build on growth by taking an important step towards optimizing its supply chain: in
May 2010 Dachser assumed Europe-wide responsibility for the companys warehousing and freight services.
18th Edition
Based in Darmstadt, Unifine is a leading European specialist for food ingredients used in the production of pastries, confectionery and ice
cream. The company began restructuring its entire European distribution structure back in May 2009 and leased space in a logistics center with
4,000 pallet spaces that is run by Dachser Food Logistics. This serves Unifine as a platform for all German and European outbound
consignments. From here, Dachser also handles contract logistics assignments for other food logistics customers. The logistics center is
conveniently located at the Bad Homburg motorway intersection just north of Frankfurt, and thanks to state-of-the-art technology and different
temperature zones is optimally equipped to meet Unifines requirements.
In March, Dachser assumed responsibility for distribution from the Portuguese Unifine location Quinta do Anjo to consignees on the
Iberian Peninsula. In the second half of this year, the warehouses and freight services in Belgium, France, the UK and Hungary will switch to
Dachser. With this move, Unifine hopes to secure a clear advantage in terms of logistics efficiency and service quality.
Slowly does it
Late last month, Dachser UK announced the acquisition of Leach Distribution as part of plans to grow its presence in the UK. In an exclusive
interview with IFW, MD Nick Lowe explains the strategy
IFW: What are your expectations for 2010?
Lowe: I think things have definitely improved this year. We did see a decline in revenue last year, although it was not drastic, with most of
this being down to our biggest customers de-stocking.
Despite that, we increased the market share of our European export business, which is our core product.
On the European export side, we had a record month in March, in terms of export volumes. Customers managed to export more because, as
parts of mainland Europe came out of recession, they have been taking advantage of the weaker pound to buy from the UK. We have also
developed new business.
IFW: Have you adjusted your network to capitalise on export growth?
Lowe: Towards the end of last year, we set up direct connections from Northampton to our central European hub. That adds to our services
because we already go directly to Paris, Lille, Cologne and Dortmund in the north-west. A central European hub means we have good links to
central, eastern and southern Europe.
This also helps improve transit times. If we have a pallet to go to Prague, it goes straight into the Eurohub overnight and the next day its in
Prague.
IFW: Which sectors have been fuelling UK export growth?
Lowe: Last year we questioned where we could source new customers. It was logical that the companies exporting commodities easily
sourced from the UK would increase volumes because of the strength of the euro against the pound.
If you are looking at computer screen-cleaning products, catering supplies, confectionary, or whatever, sources of these are more easily
switched from one country to another by buyers than say computer parts, electronics or other hi-tech items. So our strategy has partly been to
look at customers dealing in commodities and consumer goods.
We have picked up a few customers in those sectors, but we have also picked up customers in the technical sector as well.
IFW: How has Dachser UK won business in these sectors?
Lowe: Youve got to be reactive and flexible -- our customers have to be, and we have to be. We also recognise that it is a very competitive
market, and we have to be very innovative in what we do.
The whole thing is price-driven. We need fast transit times and we have to offer quality services. The Dachser system offers a high level of
visibility, we can track consignments all the way through to final delivery.
Also, our damage regime is very strict and we have full hazardous capability throughout the European network.
IFW: What is currently more important to customers, price or good service levels?
Lowe: Its still both. Price has always been important and customers want to optimise costs as far as possible. We were under extreme
pressure from a pricing point of view last year, but that was also because when there is less volume in the market prices go down because of the
supply and demand balance.
IFW: How are haulage rates faring, and what could impact them in the future?
Lowe: The reductions in European road freight rates have flattened out. The biggest cost driver is the euro, because a lot of our operational
costs for exports into Europe are in euros and we tend to sell in sterling.
So if the euro strengthens against the pound, that impacts our margins and, ultimately should lead to an increase in freight prices. But
because it is still a very competitive market, we, and most of our competitors, have to absorb currency fluctuations.
If the value of the pound
goes below 1.1 against the euro we will ask how long we can tolerate that.
Fuel is another big factor. The price of diesel has gone up in the past six months, but remains a little below the peak of two years ago.
But we cant go to our customers and say, the price of fuel has gone up, currency has gone the other way, so we have to increase your rates.
In a very competitive market, we have to make sure weve done everything to optimise our costs in terms of our operations, optimal load
factors, using double-deck trailers where we can and reducing our production costs as much as we can before we turn to our customers for
increased rates.
IFW: How do your rates compare with competitors?
Lowe: We might not be the cheapest for one pallet to France, for example, but one of the benefits we offer is that our prices to lots of places
in Europe are very competitive. Youre never going to be the cheapest all the time, its impossible to do that.
Its overall value that matters, and one of the advantages we have is that we are able to go every day directly into the whole of Europe as a
18th Edition
one-stop shop.
Its an advantage for our customers that they do not have to work with one carrier for Spain and another for Germany. We can do the lot.
IFW: Do you have plans to make any further purchases this year?
Lowe: Probably not. But over the next few years, we will be looking at making similar acquisitions to the Leach Distribution deal in other
regions of the UK.
The objective is not to have 30 to 40 branches so we dont have to use any pallet networks. It is to cover a much larger percentage of our
business through our own office structure. Were probably looking at having around six or seven branches at maximum -- at the moment we
have three: in Northampton, Dartford and Rochdale.
IFW: How else are you aiming to grow Dachser UK?
Lowe: Partially by acquisition and partially through aggressive sales. Our European business increased by 20% last year. Will we be able to
perform that well again this year? Well have to see.
Last year, our customers were doing less, but we made up for it by getting new business on board, and that was down to our team and their
sales technique.
We are part of a very big group and there is a lot of potential business out there, so we are in growth mode.
IFW: Has the trend for sourcing goods closer to destination markets increased over the past year?
Lowe: We still see a large amount of our logistics activity coming from the Far East, and one potential customer recently told us it was
actually increasing its outsourcing from India. In 2004, 80% of their product came from Europe, but now 90% is sourced in the Far East.
In terms of near-sourcing, North Africa is an interesting market for us. There was more sourcing from Morocco and Tunisia recently,
especially when the container rates went up. It suddenly became cheaper to bring a container to London from Morocco than from Hong Kong.
In the retail sector, we get a lot of business for shirts from Morocco and Tunisia, which can be two-way business -- we export the fabric and
components to the factories in Tunisia and bring back the finished articles.
Over a longer period, if environmental pressure increases, you can imagine more local manufacturing and production, and there will be a lot
of pressure politically in the UK to support manufacturers.
Also, Chinas production costs will increase as the expectations of its people increase. Wages will go up and so will fuel costs. The question is
how long can China stay more competitive than sourcing closer to Europe?
Dachser optimistic for 2010
Despite a downturn in revenue in 2009, Dachser is optimistic about the current business year, with optimized processes and new customer
contracts having leveled the drop in revenue at 9.4%.
Although Dachser's consolidated gross revenue dropped from 3.58 billion to 3.24 billion, the company's management spokesman
Bernhard Simon is confident that the company is right on track.
"We have used the crisis year in 2009 to carefully review and optimize our processes, structures and management concepts," said Simon,
adding that the company has a sound financial base that will enable it to continue to expand its logistics network.
All in all, Dachser handled 41.8 million consignments last year, weighing a total of 29.4 million tonnes, representing a 1% increase in tonnage
transported.
In its core business segment, Dachser European Logistics, revenue dropped by 9%. This business segment accounts for 67% of the group's
total revenue.
Dachser's Air & Sea Logistics business segment posted a result in line with the general average decline in this market segment, and accounted
for 17% of Dachser's group revenue.
Contrary to the market trend, the Dachser Food Logistics business segment managed to improve its performance by 1%. This business
segment contributed 15% to overall group revenue.
Dachser's new financial year got off to a promising start, with results in Q1 stabilized at the level of Q4 2009.
With its strategic Mobilization for Europe focus program (MOBILE 2015), Dachser has laid the foundations for further growth in the
European groupage market. In addition to the existing Euro hub in berherrn, Dachser is establishing two more Euro hubs in Bratislava
(Slovakia) and Clermont-Ferrand (France), enabling it to expand its portfolio of products and services in central and eastern Europe.
Core competence: Contract logistics
The global Dachser network, competent staff and clever IT solutions are the foundation stone for an optimum combination of the various
service modules.
Dascher ups stake in Taiwan subsidiary
Logistics company Dascher said Monday it has upped its stake in a joint venture in Taiwan.
Dascher now owns an 80 percent share of Dascher Taiwan, which it founded as a 50-50 joint venture with Taiwanese logistics provider
Leader Mutual Freight System Inc. five years ago.
The Taiwan subsidiary has 30 employees and is based in Taipei.
DACHSER ESTABLISHES ITS OWN COMPANY IN BRAZIL
Termination of the joint venture with Logimasters. Cooperation to be continued on a partnership basis.
Kempten/Indaiatuba. June 2, 2009. The joint venture partners Dachser and Logimasters are reorganizing the business segments in Brazil and
terminated their joint venture with effect from March 31, 2009.
The internationally operating logistics provider is taking over all international business, which is to be consolidated in the newly founded
Dachser Brasil Logstica Ltda. headquartered in Indaiatuba. From there, the logistics provider manages air and sea freight business, including
existing partner connections. Furthermore, Dachser Brasil is to acquire 100 percent of the shares in Logiprojects and will thus also coordinate
international special and project business from and to Brazil.
With the new company, Dachser is directly connecting the Brazilian market to its international air and sea freight network. Dachser Brasil will
continue to cooperate with Logimasters on a partnership basis and will in future forge ahead with the further development of national
forwarding and logistics operations.
Dachser Brasil is managed by Richard Frank Sches, a locally and internationally versed logistics manager. Sches was latterly employed with
Volkswagen Transport of South America and the shipping line CSAV.
With this step, we are reinforcing our global air and sea freight network and consolidating our position in the Brazilian growth market. This
also paves the way for the important pending integration of our logistics systems, says Thomas Reuter, Managing Director Air & Sea Logistics
at Dachser.
In 2008 Dachser generated total sales of EUR 3.6 billion. 18,175 staff working in 305 profit centers worldwide handled 43.3 million
consignments weighing a total of 29.1 million tonnes.
18th Edition
45 3363-5541
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Ocean Carriage
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
International, retail-based VAWD and freight forwarder tied to the largest containership company.
KEY PERSONNEL
Rolf Habben-Jansen
CEO
Mark Michaels
CCO, North America
Jeremy Mark Thune Haycoc President, North America
Jan Andersen
Monica Laufenberg
2,012
885 **
10,000
200
1-5
Exchange:
Copenhagen
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
3.3
Total Other:
Total Trailers:
Total Aircraft:
70
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Food, Groceries
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Damco.com
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--Damco.com
Proprietary--Damco.com, Manhattan
Proprietary--Damco.com
Proprietary--Damco.com, SAP
Proprietary--Damco.com
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Beverages
Adidas
Apparel
Specialty Retailers
Secaucus, NJ
CVS
Multiple
DairyAmerica
Food Production
Fresno, CA
Disney Store
Entertainment
Footstar Inc.
Apparel
Apparel
Asia
Home Depot
Specialty Retailers
Atlanta, GA
General Merchandisers
IBM
IKEA
Specialty Retailers
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Thailand
Multiple
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Angola
Bahrain
Cambodia
New Zealand
Belarus
Mexico
China
Belgium
United States
Georgia
Bulgaria
Argentina
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Nicaragua
Panama
Paraguay
Peru
Trinidad and Tobago
Uruguay
Venezuela
Benin
Burkina Faso
Burundi
Australia/New Zealand
Damco
Algeria
Africa/Middle East
Asia/Pacific
Hong Kong
Cameroon
Chad
India
Cte d'Ivoire
Japan
Cyprus
Korea
Eqypt
Ethiopia
Malaysia
Croatia
Czech Republic
Denmark
Indonesia
Estonia
Finland
France
Germany
Nepal
Greece
Guinea
Pakistan
Hungary
Iran
Philippines
Ireland
Iraq
Israel
Singapore
Italy
Sri Lanka
Latvia
Taiwan
Lithuania
Thailand
Malta
Ghana
Jordan
Kenya
Kuwait
Netherlands
Vietnam
Lebanon
Madagascar
Norway
Poland
Malawi
Portugal
Mali
Mauritania
Mauritius
Romania
Morocco
Slovakia
Mozambique
Slovenia
Namibia
Spain
Niger
Nigeria
Sweden
Russia
Switzerland
Oman
Turkey
Qatar
Ukraine
Saudi Arabia
United Kingdom
Senegal
South Africa
Syria
Tanzania
Togo
Tunisia
Uganda
United Arab Emirates
Yemen
EDITOR'S COMMENTS
Maersk is the worlds largest container line. It and parent A.P. Moller have been financially strong, aggressive
and successful for decades. Maersk Logistics was an ancillary business that functioned primarily in connection
with container operations. Damco, which now includes Maersk Logistics, reported separately in 2009. Over half of
its business is warehousing and distribution; about one-fifth of the net revenue is forwarding and consolidation.
SCM, airfreight forwarding and customs brokerage account for the rest. The majority of revenues are between Asia
and North America. About one-third is in Asia-European traffic. The acquisition of P&O Nedlloyd by its parent,
added more apparel and retail capacity through Gilberts operations. Gilbert operations are primarily in
consolidation/deconsolidation and garment-on-hangers.
Provider's Strengths
Parent company's profitability and coverage.
Provider's Weaknesses
Retail, High Tech, FMCG and Chemicals as well as Government and Military. Mark is an American national and earned his Master's in
International Logistics from Georgia Institute of Technology.
"Mark's experience with the Logistics and Freight Forwarding industry is vast and impressive and will allow him to lead and strengthen our
sales & customer efforts to a new level," said Jeremy Haycock, President for Damco in North America. "He will have an immediate impact on
our company goals and ambitions based on his industry expertise and knowledge."
Mark Michaels is looking very much forward to being part of a globally recognized, quality organization: "Damco's commitment to
differentiation in the marketplace, and continuous focus on improving service delivery makes it an exciting opportunity for me. The company's
truly global footprint with colleagues and offices on the ground in virtually every corner of the world provides a great opportunity to grow the
company and creates a positive impact for customers."
Its Alive
A Danish company, working with Maersk Line, has developed a new method for transporting live seafood that could potentially
revolutionize the movement of shellfish such as lobsters, crabs, clams, oysters and mussels.
Under development for the past decade, the service, offered by Aqualife Logistics, will allow seafood companies to move their product by sea
rather than air.
The company, which has been moving cargo experimentally for several years, has begun commercial operations, moving lobsters from
Halifax, Nova Scotia, to the town of Urk in the Netherlands, site of one of the biggest seafood auctions in Europe. A market center for the
seafood industry, it is located inland, strategically between two of Europes biggest ports, Rotterdam and Bremerhaven.
Philip Bresling, a business development manager for North America at Aqualife, said the company hopes to rapidly roll out its service to
other trade lanes.
Hopefully some day we will be able to connect the entire world, he said.
The company, publicly traded on the Nasdaq OMX stock exchange in Copenhagen, touts its service as not only being more economical, but
as environmentally friendly, since less fuel is consumed and less carbon dioxide produced when cargo moves by sea rather than by air.
Every time a kilo of fresh or live seafood is airlifted across the Atlantic or Pacific Ocean, the environment is polluted with 3.4 kilos of
carbon dioxide and this takes place on a huge scale, said Lars Nannerup, the companys chief executive.
About 15,000 tons of lobsters are shipped by air from North America to Europe, resulting in the production of about 51,000 tons of carbon
dioxide. By converting that cargo to ocean freight, carbon dioxide emissions can be reduced 90 percent, the company said.
The green marketing is perhaps appropriate, since Bresling said the company has its origin in the decades old campaign to improve water
quality in the Limfjord in Denmark by cultivating shellfish to reduce algae.
The effort was successful in improving both the quality of the waterway, and making Limfjord renown for the quality of its mussels and
oysters.
As production grew, an organization called the Danish Shellfish Center began to explore ways to better market its shellfish and hired
Nannerup as a consultant.
With a background in the food and consumer goods industry, with companies such as Haagen-Dazs, Pepsi and the butter company Dolina
Scandi, Nannerup succeeded in selling the Danish shellfish to restaurants and other buyers in Europe.
But while the Limfjord shellfish were of excellent quality, the company found it was sometimes difficult offering consistent delivery because
shellfish farms might be closed because of storms or other events.
So the Danish Shellfish Center looked at developing a storage system where it could create a buffer stock of mussels.
A company, Fjords ApS, was created to trade shellfish and at the same time tested various solutions for fresh seafood storage and logistics.
Aqualife developed a plastic shellfish tank through which water could be exchanged, filtered and aerated so the seafood could be held and
kept in optimal condition for long periods of time and a buffer stock maintained.
In 2005 Maersk Line became involved in the effort and together with Aqualife developed a system for moving seafood in containers.
Tests to move snow crab from Greenland and lobsters from Canada to Denmark by ship were conducted in 2005-2006, and last year
launched the first transport corridor moving lobsters through Montreal to Holland.
Aqualife has a fleet of 15 containers that it plans to put into service, which will move on Maersk ships in its transatlantic TA4 service that
added a Halifax call in mid-May. The company plans to move two or three containers filled with lobsters on each voyage.
Each refrigerated container has 20 of the Aqualife tanks, which are essentially large plastic barrels that take up one pallet position and can be
easily moved in and out of a container with a forklift.
Bresling explained that instead of delivering their lobsters to an airport, suppliers will bring their seafood to Aqualifes Aquaport, where
they will be loaded into barrels where water is exchanged, chilled and aerated as in an aquarium.
The water temperature is reduced to just above freezing, which slows the lobsters metabolism and brings them into a state similar to
hibernation. The lobsters can then be transported and kept in top condition for four weeks without the necessity of water exchange as long as
the water is oxygenated. This also potentially allows transportation of multiple types of seafood in the same container because water is not
moving between the different tanks.
Aeration is done with a compressed air system as lobsters cross the Atlantic, so there are no additional mechanical systems besides the
standard container refrigeration unit. The sturdy aquariums are made of food grade plastic and designed to withstand extreme tilt and roll in
rough seas.
Once the container arrives in Rotterdam, it will be trucked to Urk.
The seafood is unpacked, checked and hooked up to a new filtration and water exchange system. The seafood can then be immediately
shipped to European buyers or stored at Aqualifes Urk facility and gradually released to the market.
Bresling said the plan is for Aqualife to roll out its service on additional trade lanes and to move other products such as bivalves. The
company has already done experimental shipments, but he said it has to make sure it is in compliance with the U.S. Food and Drug
Administration, Canadian Food Inspection Agency, and European food legislation.
The company is starting with crustaceans, he said, because they dont have the same ability to carry bacteria or algae like bivalves. He said
caution must be taken to ensure invasive species arent carried from one continent to another. To prevent this, the company either recycles water
or filters it before disposal in sewage systems. As a further caution, it also locates its Aquaports inland, away from the ocean.
The company has experimentally moved a wide variety of species: European brown crabs, snow crabs and lobsters, mussels, several sorts of
clams, and oysters.
He said it might be possible to develop two-way flows of seafood on some trade lanes, though he noted Europe is a net importer of many
sorts of seafood.
The amount of seafood that can be carried in each container varies depending on species it is possible to transport four to seven tons of
lobsters and 12-15 tons of bivalves.
18th Edition
Aqualife does not take title to the product it sells and never will, Bresling said.
We have logistical partners Maersk and other freight forwarders and our job is to facilitate transportation, he said. The company is
working exclusively with Maersk, which he said is a joint patent holder of the companys equipment.
In 2011 the company hopes to set up operations on the West Coast of North America so it can ship to Asia, and he said the company hopes
to also set up other Aquaports on the East Coast so it can reach other parts of Europe with other products, including Maine lobsters or clams
from New Jersey.
Bresling said there are also West Coast products that are in big demand in Europe, and seafood could be moved from the West Coast by rail
or truck or ship, replenished at Aqualife facilities on the East Coast, and then shipped onward to Europe
While the company says the shellfish market is large enough to keep it busy, it has also looked at whether it might be possible someday to
develop a system for transporting finfish by container.
DAMCO JOINS DASH7 ALLIANCE
Madison, NJ, May 17, 2010 The DASH7 Alliance, a coalition of organizations promoting a standard for wireless sensor networks, today
announced that Damco, the combined brand of A.P. Moller-Maersk logistics activities, has joined the Alliance. As a member of the DASH7
Alliance, the company will work with more than 40 companies around the world to advance development of the ISO 18000-7 (DASH7)
standard.
When Damco gets involved in a technology alliance it has great potential to move the market, said Patrick Burns, president of the DASH7
Alliance. Damco is a thought leader around many supply chain technologies and their involvement in the DASH7 Alliance will greatly advance
our efforts to establish DASH7 as the de facto standard for any commercial organization that wants better knowledge as to the whereabouts and
condition of its people, assets and cargo.
DASH7 is a wireless sensor networking technology that evolved from the radio-frequency identification and sensing technologies used in the
defense industry. Because of its long range, ten-year battery life and its ability to penetrate water, concrete and other materials that can block
other Radio Frequency (RF) signals, DASH7 is used extensively today by the military for tracking ocean cargo shipments. To meet the needs of
the commercial shipping and supply chain industries, The DASH7 Alliance recently formed the Container Sensing and Security Initiative (CSSI),
to define the next generation of cargo container tracking and monitoring devices.
We see great potential for DASH7 technology, said Jeremy Haycock, President of Damco USA. We hope that by joining the alliance, we
can have an impact on how the technology is applied to areas such as container security, perishable goods, air cargo and other applications, thus
providing improved service to our customers.
DAMCO RAMPS UP INVESTMENT WITH KEWILL TO GLOBALLY ROLL OUT OCEAN AND AIR FREIGHT FORWARDING
SYSTEM
Copenhagen, Denmark, May 10, 2010 Kewill plc, a leading provider of solutions that simplify global trade and logistics, has today
announced a significant milestone in delivering its Kewill forwarding system globally for Damco, one of the worlds leading providers of freight
forwarding and supply chain management services, following the successful completion of the first phase of implementation.
Damcos ocean and air freight forwarding customers will benefit from the higher service levels, increased inventory management and
shipment visibility, and greater operations efficiency.
Having better data readily available across the business will enable Damco to make better and faster decisions and to provide our customers
with faster responses having all information in one location. In combination with Damcos suite of visibility, connectivity and booking tools, the
Kewill platform enables Damco to provide customers with a solution which exactly matches their individual requirements.
Following an extensive program of user acceptance testing by Damco, the Kewill system was deployed to manage air and ocean shipments,
including multimodal, between Asia and Europe, providing the required localized documentation at each port.
The system will now be rolled out over the next two years to approximately 3,000 users across the Damco forwarding network covering
more than 100 countries and over 250 branch offices worldwide. This represents a multi-million dollar investment by Damco in Kewill software
and professional services over the next two years.
Damcos Chief Operating Officer, Peter Kjaer Jensen commented: Damco chose to work with Kewill as its forwarding platform following
an extensive review and testing of the various options in the market. The Kewill platform was evaluated to be the most suitable for a global
forwarding business. In addition, the Kewill organization was assessed to be the most responsive in understanding Damcos business model.
The Kewill platform will bring opportunities to Damco in terms of automating and standardizing parts of the ocean and air forwarding
operation. Having just one platform across the entire organization, will enhance Damco visibility and facilitate easier global connectivity towards
customers, suppliers and government entities. This and the ability to file-share across the global business is expected to improve data-quality,
reduce costly manual rework, and improve the customer experience.
Jacquie Boast, European Chief Operating Officer of Kewill commented: We are delighted to have delivered the first phase of this important
project to Damcos satisfaction, in turn securing the next phase of the project to roll out the system globally. Our experience of delivering largescale software implementations internationally allows us, and our customers, to enter this next phase of the project with confidence.
DAMCO STRENGTHENS NETWORK IN THAILAND WITH NEW FACILITY
Madison, New Jersey, March 22, 2010 Damco has commenced warehousing and distribution services at a new import and export logistics
hub in Samrong, Bangkok.
Strategically located on Poochao-saming-prai Road between Bangkok city and major industrial zones Bangna and Bangpoo, Damcos new
facility is directly connected to Laem Chabang Port via a daily container barge service.
The one-stop logistics hub provides services ranging from barging, container freight station to general and free trade zone warehousing,
enabling customers to complete every aspect of import or export handling, including customs clearance and other value added services.
The comprehensive logistics services provided at this hub can meet the logistics needs of every customer, said Kiattichai Pitpreecha,
Country Manager for Damco in Thailand.
There are many different service combinations available to customers, depending on their needs. For example, a customer can barge import
containers directly from the ship to our warehouse, store raw materials in the free trade zone and only deliver to factories when needed, to
benefit from postponed duty payment, added Kiattichai.
Already, a global F&B manufacturer has benefited with a cost savings of 30% by leveraging on the facility and barge terminal to bypass Lad
Kra Bang Terminals Inland Container Depot in Bangkok for its import logistics and domestic distribution operations.
Michelin Picks Damco for Vietnam Logistics
18th Edition
18th Edition
info@dbschenker.com
49 201 8781-8495
COMPANY BACKGROUND
Parent Corporation:
Deutsche Bahn AG
Asset Focus:
Market Area:
Founding Business:
Global
Int'l Freight Forwarding
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
Tier 1 integrated logistics provider and global supply chain manager tied to major European truck and rail companies.
KEY PERSONNEL
Dr Detlef Trefzger
Karl Nutzinger
Dr. Thomas C. Lieb
Ticker Symbol
15,696
7,500 **
57,134
1000
3.5
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
20,000
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
10,000
Total Other:
Total Reefers:
Total Flatbeds:
50
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Oracle--OTM, SAP
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Infor/CAPS, Oracle--OTM
Infor/EXE, SAP
Oracle--OTM
SAP
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
ISO Certified Certification Locations: 55 U.S. offices and more than 600 worldwide.
Other Services: 20,000 vehicles in Europe.
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Airbus
Aisin Seiki
BMW
Global
Bombardier
Global
Cisco Systems
Continental Tire
Europe
Delphi
Railroads
Australia
Embraer
Global
Finmeccanica
Global
Fujitsu
Global
GE
Diversified Financials
Global
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Global
Europe
North America
Latin/South America
Azerbaijan
Australia
Austria
Canada
Botswana
Congo
Bangladesh
Guam
Belarus
Mexico
Cambodia
New Zealand
Belgium
United States
China
Bosnia-Herzegovina
Argentina
Aruba
Bahamas
Barbados
Belize
Bermuda
Brazil
Cayman Islands
Chile
Colombia
Costa Rica
Dominica
Dominican Republic
Ecuador
El Salvador
French Guiana
Guatemala
Haiti
Honduras
Jamaica
Nicaragua
Panama
Paraguay
Peru
Puerto Rico
Suriname
Trinidad and Tobago
Uruguay
Venezuela
Virgin Islands
Cyprus
Egypt
Hong Kong
Ghana
Australia/New Zealand
DB Schenker
Bahrain
Africa/Middle East
Asia/Pacific
Bulgaria
Croatia
Iraq
Israel
India
Jordan
Japan
Kenya
Kazakhstan
Kuwait
Lebanon
Korea
Czech Republic
Indonesia
Denmark
Estonia
Faroe Islands
Finland
Laos
France
Malawi
Malaysia
Germany
Mauritius
Maldives
Gilbraltar
Morocco
Namibia
Nepal
Greece
Pakistan
Hungary
Philippines
Iceland
Singapore
Ireland
Madagascar
Oman
Qatar
Saudi Arabia
Senegal
South Africa
Sri Lanka
Syria
Thailand
Tanzania
Vietnam
Italy
Latvia
Taiwan
Lithuania
Malta
Tunisia
Uganda
Netherlands
Poland
Zambia
Portugal
Zimbabwe
Romania
Norway
Russia
Serbia and Montenegro
Slovakia
Slovenia
Spain
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
DB Schenker made significant purchases from 2006 to 2008 to double the size of its operations. The purchases
include BAX in 2006, Spain-Tir in 2007 and Romtrans in 2008. Romtrans was the largest forwarding company in
Romania with 140 million in revenue and 1,500 employees. Operations go as far east as Georgia. Spain-Tir had
over 700 trucks and 16 million square feet of warehousing space covering the Iberian Peninsula. BAX added
significant North America and Asia capacity. The gross revenues are each over $2.5 billion the Americas (6.5%
of total revenue) and Asia (5.2% of total revenue). Schenker USAs gross revenues were $2.8 billion for 2008.
German operations, including Europes largest rail freight and trucking operations, are 70% of total revenues. DB
Schenker is now 2nd among world air freight forwarders (1.032 million metric tons; 3rd in ocean freight (1.424
million TEUs) and 5th in contract logistics. DB Schenkers European trucking operations have 23,000
employees/owner-operators and handled 72 million shipments in 2008.
DB Schenker is significantly expanding its contract logistics operations. Dave Bouchard was recently added to
lead the Americas effort. North American contract logistics operations are 42% consumer products, 30% high-tech,
16% industrial and 12% automotive.
Provider's Strengths
Transport and contract logistics operations in Europe and Russia are solid. The addition of BAX strengthened U.S.
and Asia visibility and capability. Schenkers coverage in South America and the Middle East fills out the offering.
Provider's Weaknesses
Taking exception to the current economic turmoil, DB Schenker Contract Logistics/SCM is hiring and expanding. Dr. Detlef Trefzger,
member of the board of management for Contract Logistics/SCM of DB Schenker Logistics, has kicked off DB Schenkers Go-for-Growth
program announcing that the company will hire 200 new top staff members as part of an expansion to nearly double revenues over the next few
years.
18th Edition
In the Americas, the effort will be led by David Bouchard, chief operating officer of DB Schenker Logistics for the region. Bouchard, a
highly respected industry exec, previously spent several years at Ryder. He has extensive experience in Latin America, especially in Mexico and
Brazil.
DB Schenkers Canadian operations have been strong for a decade. In 2004, Schenker purchased North Carolina based CCW and began
expanding contract logistics in the U.S. This expansion has proceeded quietly but strongly. Schenker Logistics now has 12 million square feet of
warehouse space and 3,500 employees in Canada and the U.S. There are 32 locations in the U.S. Twenty-five are single client dedicated
facilities; seven are multi-client. Key multi-client operations are in Los Angeles, San Francisco, Dallas, Indianapolis, Miami, and Greensboro. In
Canada, operations are consolidated around Toronto and Vancouver.
DB Schenker's North American business is currently dominated by Consumer and Electronics accounts which constitute nearly two-thirds of
revenue. The other third is spread over Automotive, Industrial and Supply Chain Services such as LLP (lead logistics provider) services. This
profile contrasts with the overall German based operations where Automotive and Chemicals are major verticals along with Electronics. DB
Schenker provides production support, finished car and spare parts work globally for a host of well known companies.
DB Schenker's Automotive Accounts:
Aisin
Bosch
BMW
Delphi
Ford
Kautex
Kia
Mercedes Benz
NAZA/Peugeot
Nissan
Nokian
Porsche
Proton
Sypka
VW
Automotive work in the Americas is limited to Ford, BMW and VW.
North American consumer accounts include Procter & Gamble (4 facilities), Kraft (3 facilities), and Unilever (2 facilities). These dedicated
facilities are big box, pallet and case, multiple product operations with significant volume throughputs. Schenker also runs six facilities for
DuPont.
DB Schenkers North American Customers:
Cadbury Adams
Cisco
DuPont
Heidelberg
Kraft Foods
Magna
Mars
Metso
Microsoft
Nokian Tires
Oc
Pirelli
Procter & Gamble
Spirit Aerosystems
Unilever
Winners
DB Schenkers major competitor on Consumer accounts is DHL/Exel Supply Chain. Not surprisingly, DB Schenkers current corporate
product map emphasizes Automotive, Consumer, Electronics and Industrial. Procurement and manufacturing support are big in Automotive
and Electronics/High-Tech. Spare parts/aftermarket operations are significant for all verticals. Schenker is one of the half-dozen truly capable
global supply chain managers for spare parts logistics (SPL). We recently visited a very good SPL example in Columbus, Ohio.
Oc Columbus, Ohio USA
Attendees:
Theresa Foran, Director Contract Logistics Strategy
Brian Leja, General Manager
Tom Perry, Director Industrial
Oc grosses $3.7 billion a year in revenue, has 22,000 employees and operates globally. Its major product lines are office copiers and large
format and production printers. It also provides supplies and technical support for all products.
DB Schenker opened in Columbus for Oc in 2003. In 2005, Oc purchased Imagistics with its copier and fax based product lines. The
Columbus Mega Center (CMC), now operated by DB Schenker for Oc, is 217,000 square feet. Extensive use is made of "pick to light"
carousels and pick lines. Oc has employees onsite who customize copiers as orders are received.
The CMC was consolidated from three separate U.S. facilities. It has high quality IT including an Exceed (Infor) WMS and integration to
18th Edition
Schenker North America is not just the freight forwarder your grandmother knew. Of course they are still one of the major air and ocean
global forwarders, albeit with modern computer-based operations. But, they do it much more efficiently now.
In addition to these traditional services, they have become a premier value-added warehousing company. They also design and manage
transportation networks. Besides that, they have major trucking operations in Europe and are now owned by Deutsche Bahn, the German
railway system.
Revenues are $6.4 billion euros. Leading customers are Hewlett Packard, Ford, BMW, Volkswagen and DuPont. Automotive logistics is
over $1 billion per year for Schenker. North American revenues are only slightly less.
18th Edition
But, Schenker is not a well know company in the U.S. While its Canadian operation runs like an engine hitting on all cylinders, it still has
major steps to take in the states.
Leading the effort is 38 year old CEO Heiner Murmann. Murmann was raised in Germany and educated in Canada. He returned and joined
Schenker in Canada ten years ago. As the new North American CEO, he is moving and modernizing Schenker substantially. That includes the
acquisition of CCW, a small warehousing company with extensive value-added repair, assembly and onsite operations. The CCW acquisition is
an example of Murmanns plan to redesign Schenker as a true supply chain manager covering all of North America.
Toronto Operations
The crown jewel of Schenkers value added warehousing operations in Canada is a 290,000 square foot distribution center it operates for
Unilever. This DC is ranked by Unilever as its best 3PL facility and has nearly perfect audit scores.
About 20 million cartons of Lipton and other Unilever brands flow through this DC per year. Thats done with 50 employees. 60% of the
outbound is case picked; 40% is full pallet.
There are a series of key design features which significantly increase the effectiveness of the Unilever DC. High density shuttle racks with 13
or 26 pallet positions are used for A-C products. These shuttle racks reduce the space required within the warehouse significantly and increase
the quick movement of product. The shuttles moving racks are controlled by the radio frequency (RF) system within the warehouse.
Case picking is done at two tower pick lines operating on two levels. Picking is done by employees in pairs. One picks, the other applies a
label to each carton. Labeled cartons are fed into an automated conveyor system which sorts and delivers to pallet creating positions at the bays
next to outbound shipment doors.
The ten outbound shipment doors are bracketed by inbound receiving. Inbound pallet license plate labels are read into the RF system which
issues putaway instructions.
The warehouse management is SoliNet. SoliNet operates a FIFO system setting up wave picks of multiple orders. The labels it generates
allow for batch picking of A and B products. That is, all of the cartons for a single product for multiple orders are picked at one time greatly
increasing employee efficiency.
A large monitor scoreboard over the loading doors keeps everyone in the warehouse current on production and accuracy.
The Schenker/Unilever distribution center is in Brampton, Ontario. It officially opened in July, 2002 and was named best DC in the
Toronto area earlier this year. Not surprisingly, the partnership arrangement between Unilever and Schenker is covered by a ten year agreement.
Customs Brokerage
In charge of the Customs Brokerage group is Ron Plum. He leads a staff of over 65 primarily clearing imports and handles five
U.S./Canadian border locations. Personnel are assigned by value of goods and verticals. Senior brokerage employees serve as auditors. This
brokerage operation handles Schenker shipments and does customs clearance work for other clients. Within the operations is a key accounts
team insuring premium service to major customers. Schenker maintains a customs consulting group to advise customers on classification and
other issues. Leading the team of consultants is Michael Sherbo, Manager of Customs Trade and Compliance Consulting. Sherbo has over 20
years of experience.
Air and Ocean Freight
This operation is lead by Dwayne Hihn, Senior VP Airfreight, and Eric Allard, VP Airfreight. Its a tightly run operation that is in the IATA
Top 10 for Canada. About 35,000 shipments per year are handled. Running alongside the Toronto airfreight operation are the domestic
transportation management section and ocean freight forwarder. The core ocean freight operations are in Vancouver.
The Future
Schenker is the 2nd largest logistics service provider in Canada, operating from over 40 sites across the country. Schenker Canada has a coastto-coast network that extends to all major harbors, airports and border crossings. In just over half a century, the business has grown to include
1,500 Schenker employees.
Globally there are about 80 key accounts, most of which present U.S. expansion opportunities. A good example of where Schenker is going
in the U.S. is a new parts distribution center opened by Richard Falk, CEO of Schenker-CCW in Indianapolis. This facility services Heidelberg
Printing Press and distributes throughout North America. Murmanns team can be expected to cross-sell heavily between its functional
specializations. The emphasis is on finding more partners for whom Schenker can be a global supply chain manager.
DB Schenker relocates management to Frankfurt
DB Schenker is to bundle its management functions in Frankfurt. The management teams of the corporate units currently located in Berlin,
Essen and Mainz will now be concentrated at the new location.
Around 330 members of the management staff of DB Schenker Logistics, DB Schenker Rail and from company-wide cross-unit functions
are now to be relocated in the move.
DB Chairman and Chief Executive Officer, Rdiger Grube, welcomed the decision, but also emphasized that this wasnt a move of the group
s headquarters: The headquarters of DB is and will of course remain in Berlin. We have over 17,000 people working for our company in the
capital.
As a key international business capital, Frankfurt is an attractive logistics centre, said Karl-Friedrich Rausch, transportation and logistics
board member. Our intention is to expand our international business operations from Frankfurt. The future of logistics is in cost-effective
carriers providing cross-sector services for our customers. With management concentrated at one location, we have the optimum conditions to
expand. Frankfurt was the obvious choice as a transportation node situated in the heart of Germany and Europe, Rausch added.
The new central headquarters, close to Frankfurt International Airport, will be hold members of the board and staff from Berlin, members of
the European management of DB Schenker Rail from Mainz and members of DB Schenker Logistics management from Essen. The locations of
Mainz and Essen will remain as the headquarters of DB Schenker Rail Deutschland and Schenker. The group aims to complete the relocation by
mid-2012 at the latest.
DB Schenker awarded US aerospace contract
18th Edition
Schenker Logistics, Inc. announced that it has signed a 5-year contract to operate a 3PL warehouse, a TMS load center and provide lead
logistics activities at Spirit AeroSystems greenfield start up located in Kinston, North Carolina.
Spirits employees at the new facility in Kinston will build the composite center section of the fuselage and the front spars for the aircrafts
wings for the Airbus A350XWB, which is being assembled at Spirits facility in St. Nazaire, France.
The partnership began in April and will be patterned after a similar project DB Schenker operates for Spirit in Wichita, Kansas. Scope of
work includes product receipt and put away; pick, pack, and sequenced line feed to point of use locations. The warehouse will deploy voice
pick, advanced kitting, visual line side management as well as automated POD functionality.
Our successful relationship with Spirit has enabled us to replicate many of the sophisticated manufacturing principles that have been
developed for the Wichita program, said David Bouchard, COO, Schenker Logistics, Inc. Weve been able to consolidate inventory,
improving visibility while lowering inventory costs, he added.
At its maturity, it is estimated that 40 full-time DB Schenker employees will work at the new Kinston facility. Based in Wichita, Kan., Spirit
AeroSystems is the worlds largest independent supplier of commercial airplane assemblies and components.
After the crisis: New demands on logistics
Dr. Detlef Trefzger, member of Schenker's management board responsible for Contract Logistics & Supply Chain Management, says that the
logistics industry faces four new realities that will have a long-term impact on supply chain management.
Addressing attendees at eyefortransport's 8th 3PL Summit in Atlanta, Dr Trefzger commented on the new demands being placed on logistics
at the start of the economic upswing.
"There are excellent opportunities for the global logistics industry to benefit from these developments," said Trefzger. In his opinion, one of
the new realities is the tremendous growth in new markets and emerging economies.
These regions will have - and will also demand - a more significant role in the global economy. This is expected to result in new business
opportunities for the logistics industry, a case in point being the automotive sector. Many manufacturers are now moving parts of their
production to these countries.
Another new reality results from the strong fluctuations in world trade, on the commodities markets and in production costs. These changes
will lead to fluctuations in global freight flows and the demand for warehousing services. "The result is increasingly less time to plan logistics
processes," explained Trefzger.
Permanent change is becoming the order of the day in planning, and Trefzger said that those who miss the boat by not diversifying broadly
enough and not adopting a global stance will face difficulties.
Outsourcing is growing considerably. Logistics companies continually assume more of the customer's workload and the associated
responsibilities. Increasing expertise is required to handle these tasks and deliver the quality and productivity levels expected. Success very much
depends therefore on having qualified employees.
The strong demand for standardized logistics solutions on a global scale is the fourth market reality. "Delivering consistently high standards
of service quality will be one of the fundamental requirements in contract logistics. This will apply to all standard solutions, but also increasingly
to customer-specific solutions," said Trefzger.
"Yesterday's decisions are today's reality, but by tomorrow they will already be out of date. "Actively driving change, exploiting talent and
innovation; and ensuring continuity in the provision of services and quality to the customer - these are the new post-crisis requirements for
logistics service providers," Trefzger concluded.
DB Schenker links new Zagreb facility to its network
DB Schenker's country organization in Croatia recently moved into a new facility in Zagreb, which includes 2,500 m2 of storage space with a
bonded warehouse and customs office, as well as 1,000 m2 of office space - making it one of the most modern facilities of its kind in Croatia.
The site is TAPA FSR A-level compliant.
The neighboring office building houses the company's corporate office including all operational units ranging from land transport through to
air and ocean freight as well as logistics. The company's additional seven branch offices in Croatia are managed from this location.
The new facility is fully integrated in DB Schenker's European and global network. Regular system connections to all European countries
include daily runs to Austria, Germany, Italy, Serbia and Bosnia.
Schenker has a presence at the Rijeka seaport as well as the Zagreb Airport, and offers connections to the regional hubs in Vienna (airfreightimport) as well as Salzburg (airfreight-export).
Forwarders boosted by continued consumer spending [Air Cargo World, May 2010]
For Schenker, Russian business has moved ahead even through the last two years. Our growth has wiped out the negative effects of the
financial crisis, says Karl Nutzinger, CEO Europe. We picked up additional accounts and have become involved in new activities, mainly in
warehousing and distribution.
The company has office in 20 locations, mainly in the industrial western third of the country, together with 60,000 sq. meters of warehouse
space. It claims the only corporate network for groupage distribution and owns 250 tilt trailers, driven by local hauliers.
A lot of individual routes are served by local providers but no-one, either international or local, has a complete network. There is no onestop shop solution, Nutzinger says. Our policy is to develop our own offices and infrastructure. Thats our backbone, and gives us the
information flow and track and trace ability we need. But we have no motivation to be in every village in Siberia.
Gains on the ground were partly offset by a decline in airfreight flows in 2009, both on regular and project basis, according to the companys
SVP Airfreight, Thomas Mack. We saw a strong recovery from November and 2010 looks promising, with a better flow into Asia.
The Russian airfreight market is 75 inbound for Schenker, driven by clothing, perishables, communications devices and spare parts. Mack
says the lack of suitable back traffic is as much a challenge for forwarders as it is for carriers, because of how block space relationships are
structured. The priorities for Schenker are to have guaranteed space into Russia and back out of the Far East. The cost is influenced by the
whole rotation, so we try to manage traffic flows with our partners to minimize the emptier Moscow-China leg.
Internally within Russia, Schenker is a major customer of ABCs freighters. Away from the big airports and from specialist charter operations,
bellyhold space provided mainly by Aeroflot is adequate. But Mack agrees with K+Ns Ruulio that airports still fall short of requirements, with
only Moscow, St Petersburg, Novosibirsk and Ekaterinburg truly acceptable from a cargo viewpoint. Customs clearance is still a major issue,
and youve got to know how to handle the system, Nutzinger confirms. We work with blue-chip manufacturers of cars and electronic goods,
so good paperwork and full compliance is essential. But guaranteeing overnight delivery can be dangerous.
He is skeptical about the promised Customs changes. Eliminating brokerage in city centers and migrating it to point of entry is wanted, and
18th Edition
has been decided politically, but the exact procedures are not yet fixed, he diplomatically puts it.
18th Edition
31-40-289 55 66
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Europe
Trucking
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
John Fremeiger
Managing Director
230
Ticker Symbol
230 **
Exchange:
425
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
100
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Food, Groceries
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
BOVA
Furniture
Europe
BSN Glasspack
Packaging, Containers
Europe
Campina
Food Production
Europe
Canon
Europe
DAF
Europe
Daimler
Europe
Daimler
Europe
Faurecia
Europe
KEYTEC Inc.
Computer Peripherals
Europe
LG
Europe
MCFE
Europe
Mitsubishi Motors
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
De Rooy
Latin/South America
Benelux
Czech Republic
France
Germany
Hungary
Poland
EDITOR'S COMMENTS
De Rooy subassembles, provides dedicated transportation runs and JIT. Integrated VAWD and transportation
operations are solid.
Provider's Strengths
Automotive logistics.
Provider's Weaknesses
[January 1, 2004]
Sittard: De Rooy Logistics and Faurecia have signed a long term agreement for Logistics Services around the manufacturing process of
carseats for NedCar. These seats are for the new smart ForFour and the Mitsubishi Colt.
Contract DaimlerChrysler
[March 1, 2003]
Geldrop: De Rooy Logistics and DaimlerChrysler have signed a contract for the in-night distribution of Mercedes-Benz car parts and truck
parts in the Netherlands. For this purpose DRL has invested in a new fleet of Actros and Atego trucks.
De Rooy Logistics acquires the company Jan Schoenmakers Transportaten
[October 2, 2002]
De Rooy Logistics takes over all activities of the international transport company Jan Schoenmakers Transporten BV per 30-09-02.
The family owned company Jan Schoenmakers Transporten has since 1927 an excellent reputation in the international transport market.
Their activities, customers, truckfleet and personnel match very well with the logistic Services of De Rooy Logsitics (DRL) in the Automotive
and Industrial market.
This take-over must be seen in DRLs strategy of growth, both autonomously as through acquisitions.
18th Edition
86-021-61031878
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1993
Asset Focus:
Market Area:
Founding Business:
International
NVOCC
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Fran Cheng
CEO
Jiang Xiaobo
Xu Jun
Marketing Mgr.
Logistics Mgr.
Zhao Weiwei
CFO
Ticker Symbol
300
60 **
1,000
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
150
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.215
0
8
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): IES, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
IES, Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
China
Springs Global
China
VIZIO
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
China
Europe
North America
De Well
Latin/South America
United States
Hong Kong
EDITOR'S COMMENTS
De Well's core businesses include De Well Container Shipping, De Well Transport & Logistics Centre, and
EVERICH Worldwide.
De Well Container Shipping has over 20 branches in China and the U.S. along with partners in major European
cities. Its primary focus is on international maritime logistics and transpacific NVOCC operations.
De Well Transport & Logistics Centre provides transportation management, VAWD, consolidation, bonded
warehousing, terminal logistics, and container maintenance and management. Its container depot is 3.9 million sq.
ft.
EVERICH Worldwide's primary focus is on working with logistics partners from abroad to develop solutions in
Asia to support the supply chain management needs of their customers.
Provider's Strengths
Ocean freight.
Provider's Weaknesses
Scanwell
Adam Ho started Scanwell in Hong Kong 28 years ago. In addition to its NVOCC operations, Scanwell Hong Kong handles 40,000
tonnes of airfreight a year. About two-thirds of these shipments are garments for customers like J.C. Penney. In addition, Hong Kong manages
truck transportation and distribution into the PRC for companies including Tyco Electronics. An important commodity for distribution is wine
most of it warehoused at NISKO, a partner company. Scanwell maintains contracts with 15 container lines in Hong Kong. Adrian Hassan,
Hos son, is executive director of business development in Hong Kong.
In 1993, Solomon Wong initiated the PRC operations for Scanwell. Wong, like the rest of the top echelon at Scanwell, is bi-cultural and
polished. Jeff Zhu, deputy general manager China, attended college in the U.S. and worked here for years. Wong lived and worked in the U.S.
for six years.
Scanwell handles over 100,000 export TEUs a year. Sixty percent go to North America and 40% go to Europe. Apparel is the primary
commodity handled through Shanghai. While Shanghai handles a sizable amount of airfreight, it is Scanwells primary ocean shipping location.
Wong discussed the available business openly. He pointed out that electronics and high-tech shipments are handled primarily by large global
supply chain managers (SCMs) like DHL and UPS. He acknowledged that companies, like Scanwell, were relegated to lower value commodities
but pointed out that margins on Scanwells airfreight business were twice what could be made on ocean freight.
Scanwell has eight U.S. offices and two Canadian offices. It also has significant coverage in Taiwan, Korea and Southeast Asia.
Summary
De Well and Scanwell are two strong but quite different Chinese NVOCC based logistics providers. They are part of a small group of
Chinese companies that could grow significantly over the next few years either organically or by purchasing American companies. At the same
time, they are attractive candidates for several American companies itching to be global SCMs. The guys we met are bright and very good
businessmen. They have been successful in China and Hong Kong and expect to be in North America and the rest of the world.
IES Announces De Well Container Shipping Corp. Chooses IES Applications; De Well Container Shipping selects IES as their logistics
software provider [via EIS Ltd. website]
Midland Park, NJ - February 7, 2005 - IES Ltd., leader in international transportation, Customs brokerage, Electronic In-Bond and AMS
filing solutions today announced that De Well Container Shipping Corp. selected IES' import, export, accounting, AMS and Web tracking
software and Web applications.
IES is proud to announce that De Well Container Shipping Corp. chose IES' software to run their logistics operations. "IES will act as our
means to maximize every aspect of our shipment handling needs ensuring we provide world class service. With their integrated forwarding
software and their robust accounting system, we gain the peace of mind knowing De Well is providing outstanding customer service as well as
superior accounting," said Kim Guo, president of De Well Container Shipping Corp.
"De Well takes pride in offering exceptional shipment handling for all our clients. With IES' integrated logistics software, De Well can excel
beyond our competition," said Ms. Guo.
18th Edition
Fax Number:
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Global
Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
Very good global LLP and tier 1 SCM. The largest 3PL. Strongest operations are in DHL (Danzas) Forwarding.
KEY PERSONNEL
Frank Appel
Bruce Edwards
Hermann Ude
32,494
21,162 **
Exchange:
176,389
500+
3
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
690
Total Trucks:
813
Total Trucks:
8,617
Total Other:
402
Total Trailers:
Total Aircraft:
10,500
Total Ocean:
Total Other:
506
248
Total Tankers:
Total Other:
75
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Oracle--OTM/sci3, RedPrairie, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Oracle--OTM/sci3, Proprietary
ClearOrbit, Allogis, Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3M
Miscellaneous
Americas
ABB
Industrial Machinery
Switzerland
Airbus
France
AMP
Harrisburg, PA
Amway
Advertising, Marketing
Japan
Andrew
China
Entertainment
OH
Argos
Europe
ASDA
General Merchandisers
Europe
Baxter Healthcare
Deerfield, IL
Bayer
Chemicals
Germany
Bell + Howell
OH
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Azerbaijan
Australia
Albania
Canada
Angola
Bahrain
Bangladesh
Cook Islands
Andorra
Mexico
Cambodia
Fiji
Armenia
United States
China
French Polynesia
Austria
Georgia
Guam
Azores
Hong Kong
Kiribati
Belarus
Nauru
Belgium
New Zealand
Bulgaria
Canary Islands
Croatia
Samoa
Czech Republic
Solomon Islands
Denmark
Tahiti
Estonia
Anguilla
Antigua and Barbuda
Argentina
Aruba
Bahamas
Barbados
Bermuda
Bolivia
Brazil
British Virgin Islands
Caicos Island
Cayman Islands
Chile
Colombia
Costa Rica
Cuba
Dominica
Dominican Republic
Ecuador
El Salvador
French Guiana
Grenada
Guadeloupe
Guyana
Haiti
Honduras
Jamaica
Martinique
Netherlands Antilles
Nicaragua
Panama
Paraguay
Peru
Puerto Rico
St. Kitts and Nevis
St. Lucia
St. Vincent and the Grenadine
Suriname
Trinidad and Tobago
Uruguay
US Virgin Islands
Venezuela
Benin
Botswana
Burkina Faso
Burundi
Cameroon
Cape Verde
Chad
India
Indonesia
Japan
Congo
Cte d'Ivoire
Cyprus
Kazakhstan
Laos
Australia/New Zealand
DHL
Algeria
Africa/Middle East
Asia/Pacific
Djibouti
Macau
DR of Congo
Malaysia
Tonga
Finland
Egypt
Ethiopia
Maldives
Tuvalu
France
Myanmar
Vanuatu
Germany
Gabon
Gambia
Ghana
Nepal
Gibraltar
North Korea
Greece
Hungary
Guinea
Iran
Pakistan
Iraq
Singapore
Israel
South Korea
Jordan
Kenya
Sri Lanka
Kuwait
Philippines
Iceland
Ireland
Italy
Latvia
Liechtenstein
Taiwan
Lithuania
Lebanon
Tajikistan
Luxembourg
Lesotho
Thailand
Macedonia
Libya
Madagascar
Turkmenistan
Malta
Uzbekistan
Moldova
Vietnam
Monaco
Malawi
Mali
Netherlands
Mauritania
Norway
Mauritius
Morocco
Poland
Portugal
Mozambique
Namibia
Romania
Nigeria
Oman
Russia
Qatar
Slovak Republic
Reunion Island
Spain
Saudi Arabia
Sweden
Senegal
Seychelles
Switzerland
San Marino
Turkey
Sierra Leone
Ukraine
South Africa
United Kingdom
Swaziland
Syria
Tanzania
Togo
Tunisia
Uganda
United Arab Emirates
Yemen
Zambia
Zimbabwe
EDITOR'S COMMENTS
DHL Supply Chain is by far the largest contract logistics operation. The Americas revenues for DHL Supply
Chain/Exel contract logistics are $5 billion with 511 warehouses and 99 million square feet of space. Global
forwarding grew through the acquisition of highly respected companies like Danzas. DHL and Danzas are strong
branches in Europe and Asia. DHL/Exel has operations of virtually every kind. A major initiative over the last few
years involves expansion into contract manufacturing and packaging.
Contract logistics revenues where 54% of its gross revenues for 2009. Gross margins for forwarding and
transportation operations are estimated at 25%.
DHL Global Forwarding currently has 31 global carrier partners with 81 contracts on a multitude of trade lanes
and more than 330 gateway facilities. Its annual FCL volume is 2,400,000 TEUs and LCL is 2,000,000 m3. There
are more than 35,000 weekly point pairs for LCL globally. DHL Global Forwarding handles 2,200,000 shipments
annually. In the U.S., DHL Supply Chain operates as Exel.
Provider's Strengths
The worlds largest general purpose 3PL and Tier 1 SCM with a host of solid operations; global reach for contract
logistics and transportation management.
18th Edition
Provider's Weaknesses
Some variability in quality of operations.
Key Personnel:
Michael Trinkus, Strategy Manager Greater China
Victor Chong, Vice President Business Development Greater China
Hudson Hua, General Manager Area Operations Contract Logistics
Introduction
DHL Supply Chain has 4,400 employees in 60 warehouse locations with 6 million square feet in 23 cities in China, including Hong Kong.
These operations generate over $400 million a year for the worlds largest contract logistician. In China and Hong Kong, DHL Supply Chain is
one of the largest operators.
Key to any logistics operation in China is to have the right national and local governmental licenses. While you can have national authority to
operate in China for warehousing and road transportation, you must have local licenses to bill and collect for services. DHL Supply Chain is a
wholly owned national operation with local business licenses in 19 major cities. Specific hygiene licenses for food warehousing, co-packing and
transport are held in Shanghai, Beijing and Guangzhou. Regional road transportation licenses are held for Beijing, Tianjin, Shanghai, Hefei and
Suzhou. Obtaining the necessary licenses in China is doable, but requires working through tedious, bureaucratic challenges. Often you need to
obtain a local business license and then a second local license for transport or special warehousing operations. Once issued, licenses are not
transferable. As a result, DHLs corporate portfolio is lined with legacy Exel and Danzas licenses. For its forwarding and express operations, it
still has joint venture operations.
To sum it up, having the right licenses is mandatory for operations in China. Working with a logistics provider that understands the process
and already has operating licenses can speed market entry. DHL (Exel) started in 1994 and leads wholly owned foreign enterprises in this
threshold capability.
Not surprisingly, DHLs customer base includes dozens of major global companies. Consumer, retail and healthcare customers include
Tyco, Johnson & Johnson, Abbott, Hersheys, Unilever and Mars/Masterfoods. Automotive, industrial and technology customers include
Kodak, Lenovo, Nokia, Ford, Samsung and Philips. Spare parts logistics customers are Hewlett-Packard, Lexmark, Lenovo, Motorola and FujiXerox.
For its automotive customers in China, DHL Supply Chain provides inbound support to manufacturing and distribution parts services. Key
customers are Honda, Bosch, Changan, Ford-Changan, Volkswagen, and Peugeot.
Retail solutions reflect the specific needs of DHL Supply Chain customers. These include some contract manufacturing and temperature
controlled operations in multi-client and company operations. Co-packing, tagging and labeling are standard value-added services. Certain
consumer retail customers receive extended services. For example, in Beijing, DHL Supply Chain sets up Starbucks stores and replenishes them
when they are closed during the graveyard shift.
For technology customers, DHL provides equipment checking and other technical support services. Inbound manufacturing support
functions are done for Hewlett-Packard and Lenovo among others. DHL Supply Chain manages service parts logistics and reverse logistics. A
similar set of solutions are differentiated for healthcare customers. As necessary, specialized engineering assistance and temperature controlled
responses are provided.
DHL Supply Chains solution sets are carried over to its Hong Kong, Macau and Taiwan operations. Technology solutions are provided for
over 20 customers in Hong Kong and Macau. The customer list expands to include Sun Microsystems, Heidelberg, Manroland, Cisco and
others. In Hong Kong, DHL Supply Chain has 440 employees and 27 locations. DHL Supply Chain (Exel) has been in Hong Kong since
1970. Retail and consumer goods customers are also prevalent.
Operations in Taiwan are more limited with 150 employees in 18 locations. Facilities are usually small. The majority of customers are
concentrated in the technology sector, although significant operations are conducted for retail/consumer goods and automotive aftermarket
customers.
Within China, DHL Supply Chain supports its contract logistics operations with an extensive domestic transportation network.
The network connects the key Eastern China locations of Beijing, Wuhan, Guangzhou and Shanghai from North to South. East-West routes
run between Shanghai and Wuhan and further on to Chengdu. There are regional cross-docks in four key cities plus Tianjin. There are also 10
sub-regional cross-docks. Kewills iTrans is the TMS (transportation management system). DHL Supply Chain is able to do merge-in-transit
and optimize its network of 800 cities. As an extension of this capability, supply chain network design and facility location can be done.
In 2008, DHL Supply Chain handled 321,000 shipments totaling 75,000 tons in its China network. Some transport is done on DHL
equipment but most happens on the vendor fleet. Chinese regulations are slanted in favor of single owner and small trucking operations, which
makes it uneconomical for a company like DHL Supply Chain to try to run a large fleet. In cities like Beijing, DHL Supply Chain conducts
pickup-delivery operations using a centralized dispatch.
Contract logistics IT capabilities revolve around Manhattans ILS.NET and WMOS products for its WMS (warehouse management system)
and the Kewill TMS mentioned above. The Manhattan products have multi-language capability, EDI (electronic data interchange) interfacing,
central hosting and are RF (radio frequency) enabled. It should be pointed out, however, that RF is used sparingly in China as opposed to the
U.S. and Europe. Most often, manual, paper based receiving, putaway and tendering are standard. The consistent argument is that the return
on investment of RF systems in warehouses is hard to justify. The software itself in China has all the capabilities one would see in DHL Supply
Chain (Exel) locations in the West.
For example, the WMOS 5001 software provides FEFO/FICO stock management, ASNs (advance shipment notices), POs (purchase
orders), serial number tracking, cycle counts, batch control, label generalization and other functions. Labor management, RFID and web
visibility are available in a support module.
The Kewill TMS has contract and tariff management, KPI (key performance indicator) monitoring and planning functions. It provides bill,
settlement and other functionality. In short, its good for design and planning but limited in some transportation execution pieces.
18th Edition
Case Studies
DHL Supply Chain has several warehouses in Shanghai. Two are in the Waigaoqiao (Why-Gao-Chow) Free Trade Zone northeast of
downtown by the old port of the same name. Five are at Songjiang, southwest of Shanghai. One large warehouse of 596,000 square feet is
located at Kangqiao (Kang-Chow). There are several other smaller, mainly high-tech related facilities in and around Shanghai.
At the Kangqiao facility, three of eight chambers (areas) are devoted to Dumex. Dumex, owned by Dannon, is a major supplier of milk
powder products to the Chinese market. The product DHL Supply Chain handles originates in New Zealand and Australia. Dumex products
were found melamine-free early in 2008 during a scare when infants got ill from competitor (Sanlu) products.
Twenty-five kilo bags of inbound Dumex product are received in container loads and reloaded on double size pallets. The inbound product
is stacked four to five high in Chamber 4 near the middle of the warehouse. This basic milk powder is moved as needed from the Kangqiao
warehouse to the Dumex processing plant a few kilometers away. There it is mixed, blended and otherwise turned into finished consumer
products.
The finished products are returned to Kangqiao and stored in Chambers 6 and 7 from which orders are picked. Product is shipped to about
130 destinations in China. About 6,000 pallets of finished products and half as many of raw product are stored in 160,000 square feet.
An office is maintained on-site by Dumex and raw product quality control sampling is on-going. Products are tracked by SKU (stock
keeping unit) and batched in the WMS. Returns are handled and processed by DHL Supply Chain.
During 2008, over 350,000 cubic meters of finished product was processed through Kangqiao.
Kangqiao is a very modern, clean, food grade warehouse. Its other clients are Abbott (powdered milk products) and Homebase UK
(hardware, fasteners, etc). Homebase involves 750 SKUs and heavy piece picking with co-packing. There are 11 vendor supplier locations in
China. The SKUs for DHL Supply Chain exceed 99% on the Dumex business.
The Waigaoqiao Free Trade Zone (FTZ) is in the Northeast Pudong area of Shanghai where the Changjiang River runs into the ocean. It
was Chinas first FTZ established in 1990. About 6,000 companies utilize the FTZ which is next to the Waigaoqiao Port. The total area is 8.5
square kilometers including a bonded logistics park of 1.03 square kilometers next to the port.
In 1997, Exel Logistics China began operations in the bonded logistics park for Pernod Ricard, the worlds second largest wine and liquor
dealer. About 11,000 pallet positions are used in this business. Some temperature control is provided. Product is received after the FTZ
declaration, picked, unpacked and repacked as needed, relabeled as needed and reshipped at which time the outbound FTZ taxation declaration
is made.
For Hewlett-Packard, DHL Supply Chain manages parts and returns from the Shanghai High-Tech CDO. Bonded storage and crossdocking is done. Most products are received from Singapore, Thailand and South China. Same day to three day services are provided for end
customers. A control tower guarantees the agreed service levels. The bonded operation defers VAT (value added tax) and allows for duty
management. Two hundred twenty cities are served from the DHL Supply Chain bonded warehouse. Twenty-six of these are served on same
day basis. The central hub in Shanghai handles over 2,000 orders a month. Satellite hubs in Beijing, Guangzhou and Chengdu all handle
significant amounts of orders. Average inventory turns are 26 per year. Ten thousand square meters are used for this closed book operation.
For Starbucks, DHL Supply Chain services 148 stores and two distribution centers. It provides chilled and temperature controlled service as
needed. Orders are processed electronically. Frozen products are maintained in Wuhan, Xian and Chongqing plus the central warehouses in
Beijing and Guangzhou. DHL Supply Chain delivers restock products at night when stores are closed. DHL Supply Chain has 34 employees in
warehouse locations handling 1,300 SKUs for Starbucks. The delivery on-time rate is 99.9%.
Summary
DHL Supply Chain has one of the largest and most technically advanced contract logistics capabilities in Greater China. Its customers are
primarily major global customers who seek security, inventory control and end-customer satisfaction. DHL Supply Chain delivers top notch
solutions in an environment that can be very challenging.
For comparison, Hong Kong based Kerry Logistics has 6,700 total employees in contract logistics operations, freight forwarding and land
transportation operations for China, Southeast Asia and a few Western operations. Kerry claims 51 warehouses and 12 million square feet of
space for China and Southwest Asia.
EXEL - At the Center of Global Supply Chain Management [To view in full html format, follow this link:
http://www.3plogistics.com/DHL%20Exel%20Supply%20Chain_1-2009.htm]
January 8, 2009
Key Personnel:
John Gilbert CEO, Exel Americas
Mike Gardner Chief Development Officer, Exel Americas
Brian Newton Vice President M&A, Exel Americas
Andrew Hadland Sr. Vice President, Exel Transportation
David Vieira President, Exel Direct
Patrick Kelleher Sr. Vice President, Retail Americas
Robert McCormick Vice President Design and Delivery, Exel Americas
Steve Nissen Director of Operations, Retail Americas
Derrick Flood General Manager, Retail Americas
DHL delivers a huge global logistics network. Key components are the worlds largest freight forwarder, the worlds largest contract logistics
operation and the third largest express company. The core of many of its globally integrated supply chain solutions is DHL Exel Supply Chain.
With revenue approaching $5 billion, DHL Exel Supply Chain operates as Exel in North America and DHL in Latin America. The
breakdown goes like this:
United States
386 Facilities
75 M. Sq. Ft.
22,000 Employees
The largest U.S.-based contract logistics operation with significant transportation operations.
18th Edition
Canada
55 Facilities
11 M. Sq. Ft.
5,500 Employees
Dominant, Canadian contract logistics provider. SCM operations for Wal-Mart include seven distribution centers.
Latin America
70 Facilities
13 M. Sq. Ft.
12,500 Employees
The largest contract logistics operator in Brazil and Mexico.
The Americas operations are 26% of DHL Exel Supply Chain revenues. The UK and Europe operations are each about one-third with
APAC delivering the balance.
Exel handles more retail and consumer goods products than any other third-party logistics provider (3PL). Its emphasis is on the Fortune
Global 250. The 12 companies it serves in the Columbus, Ohio, area are a microcosm of that emphasis. For example, it has an 800,000 square
foot, high quality supply chain management (SCM) operation for Goodyear.
Exel has other multi-million square foot campuses in Atlanta, Chicago, Dallas, Detroit, Harrisburg, Houston, Los Angeles, Toronto, Mexico
City and Sao Paulo. These campuses often include smaller, multi-client operations as well.
Befitting its #1 ranking is the Class A operation conducted for Toys"R"Us in Columbus.
Toys"R"Us
DHL Exel performs global supply chain management for Toys"R"Us, managing purchase orders and transportation for vendors principally
in Asia to the Americas and Europe. Much of this work is done using the Internet-based solution LOG-NET by the ISC (International Service
Center) operation based in New Jersey. Typically shipments flow to Yantian in the PRC where consolidation is done as necessary for China and
other Asian origins.
The start-up for the Groveport, Ohio operation started April 3, 2006, after Toys"R"Us divorced itself from Amazon. Exel took over
350,000 square feet on a short-term basis to house the stock from Amazon and began filling orders. A second building of 574,000 square feet
was set up in the meantime as a permanent solution. The first shipment from this mechanized location was made on June 25. The labor
demand was so great during the first peak season that Exel personnel from the home office and the Pennsylvania campus were pulled in to get
the job done. Nearly all of the 350 headquarter personnel did double duty during the period from Nov. 15Dec. 20, 2006 to ensure this highly
complex startup was a complete success. The contract with Toys"R"Us was signed in May 2006.
By Nov. 1, the two picking towers in the building were operational and more than 10,000 SKUs (stock keeping units) were available for
selection. By the end of November, the product line increased by another 20%. The facility now handles well over 50,000 orders a day in
season with 1,100 personnel. Out of season, orders run about 10,000 a day with 250300 core, year round personnel. To handle the variation,
Exel has set up its own temporary employment service. This arrangement provides for more returning seasonal employees and better
productivity year to year. In addition, Exels quality improvement process has led to a 30% increase in efficiency since November 2006.
The warehouse management system (WMS) used to run the facility is Manhattans PkMS with the addition of RedPrairies labor management
system. Outbound transportation management utilizes Oracle TM.
Replenishment is done primarily on the third shift. Conveyors are run 20 hours a day. And, if you want your order wrapped for Christmas,
Exel has a host of people to do it.
Exels high volume, high quality operations for Toys"R"Us are repeated for several other major companies. Wal-Mart, Goodyear, and
Alpargatas are examples.
Transportation
Because of the size of its value-added warehousing and distribution (VAWD) operations, one might overlook a couple of sizable
transportation operations owned by Exel.
Exel Direct is a white glove home delivery business operating throughout the United States. It has a well organized call and appointment
control center in Columbus. Exel Direct operates over eight hundred 26-foot delivery trucks. Home appliances and furniture
deliveries/installations are the core of this challenging, customer sensitive business. Exel Direct has centralized tracking for all vehicles and
stops. This capability provides real-time support. Exel Direct has 66 dedicated and 81 agent locations. Major customers include: Crate &
Barrel, JCPenney and Williams-Sonoma.
Exel Transportation is the third largest freight broker/transportation manager in the United States with $1.5 billion of freight under
management and net revenue in excess of $120 million. It has 400 employees and 280 agents across North America. Its principal transportation
management locations are Akron, Chicago, Dallas, Houston and Mechanicsburg. Day-to-day freight brokerage operations use Tritan
(MercuryGate) IT. Systems transportation management is done with Oracle TM (G-Log).
In addition to truckload (TL) and less-than-truckload (LTL) work, Exel Transportation is heavily involved in intermodal and rail car
management activity. For many customers, such as Frito-Lay, Exel Transportation provides brokerage services across multiple modes. The
partnership with Frito-Lay is a long-standing one and, in 2007, the company honored Exel with its carrier of the year award.
On the freight brokerage side, Exel Transportation handles over 300,000 truckloads a year. Its growing LTL business covers Canada and
Mexico as well as the United States. IMC (Intermodal Marketing Company) activities are about 40% of total activity.
A unique part of Exel Transportations IMC business involves its 500 reefer trailers. These GPS/CARD units are used primarily for coast-tocoast fresh produce loads and run on BNSFs expedited service. This operation is a principal competitor with MARTRAC, a UPS operation.
TMC (Transportation Management Center) operations involving Oracle TM are based in Mechanicsburg and Houston. The Akron TMC
operation is on-site at Goodyear and utilizes the Manugistics TMS. TMC operations include carrier contracting, transportation planning,
network optimization, freight payment and performance management.
For Goodyear, Exel Transportation manages 1.9 million orders annually (1.15 million shipments). The staff of 40 runs a 24/7 operation.
Shipments are 53% TL, 17% LTL, 17% small package, 9% dedicated and 4% rail. This service is complementary to the Exel contract logistics
operation in Groveport, OH.
For Diageo in Mechanicsburg, PA, Exel handles a mix of truckload and intermodal loads. There are about 80,000 shipments annually
18th Edition
handled by 22 on-site staff members working two shifts. On-time deliveries exceed 97%. On-time pickups exceed 99%. All shipments are web
visible and EDI (Electronic Data Interchange) is used extensively.
Thinking Outside the Box Oil Sands Logistics
A large area of Northern Alberta is now one of the largest sources of petroleum in the world. Canada supplies one-sixth of the U.S.
petroleum supply and what happens with the Alberta oil sands is critical to our economy.
Exel is working with the largest producer in the oil sands region to provide logistics support for its tar sands mining and processing
operations. Exel covers MRO Solutions Maintenance, Repair, Operations.
Exels services include dedicated transportation (supplier sweeps plus expedited transportation), inventory management and warehousing,
plant services, field services and contract management. This new solution set expands Exels procurement, IT infrastructure segments and
ability to operate in a remote, unhospitable area.
DHL Global Forwarding Chicago
The largest air freight operation of DHL Global Forwarding (DGF) in the Americas is located 1.5 miles from OHare Airport in (Franklin
Park) Chicago, IL. This 24/7 operation has 400 employees. The facility is 490,000 square feet of which 410,000 square feet are utilized for its
cargo operations, as well as warehousing. This warehousing space is used routinely as part of supply chain management for smaller customers
who need 5,00020,000 square feet of space for U.S. distribution. The facility is U.S. Customs Bonded, USDA (U.S. Department of
Agriculture) and DOT (U.S. Department of Transportation) compliant and has cold storage capabilities. Customers include: Caterpillar, Baxter
Healthcare, Hewlett-Packard, Siemens, John Deere and a host of others.
DGF services the world from OHare doing air freight consolidations seven days a week. There are about 6,000 consolidated shipments and
more than 7,000 air import shipments per month. Export and import cargo consist of over nine million kilograms moving through the facility
monthly.
There are 11 licensed customs brokers at this location. They interface continually with the U.S. Customs AMS (Automated Manifest
System). DGF is ISO 9001:2000 and C-TPAT (Customs-Trade Partnership Against Terrorism) certified as well as TAPA (Technology Asset
Protection Association) compliant. It is now the largest mover of the air transportation containers manufactured by Envirotainer, and Chicago
is also a QEP (Qualified Envirotainer Provider) site.
Security at the facility is well controlled. Closed-circuit television (CCTV) covers the warehouse and property. Within the warehouse, there
is a limited access security cage and a security manager on site.
For cargo delivery purposes, DGF has 25 tractor trailer combinations, three roller-equipped flatbed trailers as well as a number of cargo vans.
Summary
The combination of DHL Exel Supply Chain and DHL Global Forwarding yields tremendous global supply chain management capabilities.
Moving forward, John Gilbert, CEO for DHL Exel Supply Chain Americas, plans for more extensive integration of services. He indicates that
the biggest challenge will be to continually find enough good people. The team we met was uniformly solid.
DHLs End of Runway Logistics A Major Express Value-Added Service
http://www.3plogistics.com/DHL_5-04.htm]
Wilmington, OH Site Visit
May 26, 2004
Key Personnel:
Mike Heilman, VP & GM
John Robinson, Director, Logistics Operations
When DHL acquired Airborne, it got several things that needed fixing but logistics wasnt one of them. The logistics operation, now called
DHL Logistics, was and is a profitable niche specialist. Its main end of the runway logistics operations are adjacent to the ABX hub. ABX is
the contractor who provides the airplane lift capacity for DHL. It was the biggest part of Airborne Express.
The ABX sort and DHL logistics facilities are at the Wilmington, OH airport (ILN). The DHL (ABX) sort at this location has 1.7 million
square feet and handles over 1 million packages a night. About 60% are express packages moving on 120 flights a night and a dozen or so every
day. There are about 4,000 employees at the hub and DHL is the towns major employer. The two runways at the airport are long, and the
operation has a foreign trade zone.
The Wilmington logistics facilities are primarily in two buildings (9 and 10) adjacent to the airport and the sort. Building 10 is 300,000 square
feet with 30 principal clients. They include Gambro, Siemens, Bell & Howell, W. L. Gore and others. What DHL handles for them are highvalue/low-inventory originals and spare parts. Put differently, this high security operation handles stuff that can support airfreight costs and
needs fast service to customers. The services are labor intensive with small part (bin) picking of one item per order as the prevalent mode. About
90% of the orders move to the DHL sort each night.
DHL also does customization for computers, print logistics and any other value-adds customers need at building 10 and other facilities.
Building 9 next door has the Cole Vision pick and pack. The 1,500 stores supplied include Sears, Target and Pearle. Five labs send in eyeglasses
for reshipment.
In Grove City, OH (Columbus) DHL maintains an optical center with Wal-Mart as the anchor customer. The customers include Essilor, a
blank lens provider for companies using the optical center. The local junior college has instituted optical technology courses to supply trained
personnel. All of the components have come together to make Columbus a logical hub for contacts and glasses with DHL benefiting. Its a
good niche market.
DHL Express operates a hub at the Cincinnati airport (in Erlanger, KY). This 30,000 square foot facility is used by DHL Logistics for
international shipments. DHL has limited growth opportunity in Erlanger. It would be logical for its North and South American growth to use
Wilmington.
Most of DHL Logistics value-added services take place between 10 PM and 4 AM. (It seems that half the town is up all night working and
listening to the hum of DC-8 airplanes). Orders are fed to DHL Logistics by EDI and a robust WMS, LOGIC does an excellent job. LOGIC
ties all the DHL Logistics locations together. It has a very workable web-based dashboard and allows for good inventory control. DHLs
inventory accuracy is so tight (99.9%+) that little manual inventory activity is needed. Cut off time for next day orders is 1 PM EST.
18th Edition
Despite its functionality, DHL cannot carry Logic forward. It is working with Yantra and SAP to come up with a company-wide WMS
platform and internet overlay. The Yantra version 7.0 alternative has done well in trials. SAP is the ERP for DHL and parent Deutsche Post
World Net. The IT group now centralized in Scottsdale, AZ will make its final recommendation soon. DHL now supports 120 WMS systems
globally and rationalization is necessary.
Other logistics operations that need to be integrated under the DHL Logistics banner are DHL Express Logistics (Americas), DHL (Danzas)
Solutions, based in Europe, and occasional warehousing operations scattered around the globe.
DHL Logistics is expanding its return logistics operations. An important innovation for this business is a set of return cartons. One of these,
now carried by all DHL Express pick-up trucks, is a portable computer return carton. DHL does repair work for Dell, HP, Compaq, Gateway,
and IBM as part of this service. About 20% of DHL Logistics revenues are in returns/repairs.
The Wilmington and Columbus locations have good employee pools and turnover for DHL Logistics is low. A major part of this is location,
but John Robinson, Director of Logistics Operations, is an important factor. Hes a good guy to work for, and employee morale is high. His
boss, Mike Heilman, is a good strategist and salesman who lets his people use their talents.
DHL rides LCL wave
Global supply chain power grows its LCL network to take advantage of a surge in volume.
As demand for containerized goods recovers, a new trend is emerging, according to global supply chain powerhouse DHL: more less-thancontainerload shipments.
Its not that we see a downward trend in full containerload, said Clas Thorell, head of LCL management in Asia-Pacific for DHL Global
Forwarding, in an interview. Its that customers are diversifying their supply chains. Instead of holding back and waiting for a full load, they are
moving some product LCL.
Thorell said shippers are finding LCL makes more sense as the product options grow to suit their needs.
With LCL, you pay for what you ship, he said. You dont need to pay for empty air. You can have a more regular shipment pattern, rather
than holding back. That allows you to have a smoother production line if youre an importer. The importer is buying what they need instead of
what they need to fill a container.
DHL has been at the forefront of LCL growth, rapidly expanding its LCL network the past few years through the introduction of port pair
services. The company is not only introducing new services every couple months, it is aggressively marketing them.
LCL is something weve been doing for many years, Thorell said. In recent years, its become a core product for us.
Thorell said DHL has focused on expanding its network and operating services between niche port pairs, as well as simplifying service for its
customers. It links 45,000 point pairs and handles nearly 2 million cubic meters of LCL volume annually.
Just this year, the company has launched direct LCL service from Chicago to Busan, Shanghai to Valparaiso, Colombo to Montreal, and
Hong Kong to Guatemala. In each case, DHL said its LCL service typically shaves three days off previous transit times.
As an example, cargo between Hong Kong and Guatemala had primarily been transshipped, Thorell said. Now were giving more
opportunity to customers to use services they want to use, when they might have had to use FCL before.
Thorell said DHL has expanded its network of port pairs based on customer need and its own forecasts.
Its two-fold: when a customer has their supply chain architecture in a certain niche trade; and when we foresee there will be demand
between two port pairs, he said. We try to be the first operator in a market. We think, as DHL, we can sell value-added services beyond LCL
services, and there lies the advantage.
Of course, DHL isnt the only forwarder in the LCL segment. Global competitors UPS and FedEx (through its FedEx Trade Networks
business unit) offer their own LCL networks.
UPS operates LCL consolidations at 1,000 facilities in 180 countries. FedEx, meanwhile, has been ramping up its forwarding capabilities in
recent years, opening 25 new foreign offices globally under the FedEx Trade Networks banner. It now offers LCL services from nine cities in
China, as well as Singapore, Taiwan, Hong Kong, India, Vietnam, United Arab Emirates, Poland, Belgium, the United Kingdom, the
Netherlands and France.
Aside from pure LCL services, UPS also offers a day-definite hybrid ocean/less-than-truckload service (UPS Trade Direct Ocean) designed
to compete against those developed by APL Logistics-Con-way Freight, Old Dominion Freight Line-Hanjin Logistics, and Averitt Express.
Those services are not strictly LCL, but appeal to the same service requirements of shippers who want a single point of contact for shipments
comprising less than a container full of goods.
According to Averitt, the difference (aside from a higher cost) between LCL and the guaranteed delivery services is that with most
traditional LCL services, cargo is consolidated at origin and deconsolidated at the first port of entry, increasing the odds of delay.
The worlds biggest logistics companies also offer thorough LCL networks. Panalpina earlier this year began offering direct LCL service from
Antwerp to Houston and from Ningbo to Wroclaw, Poland. Both new services were designed to take advantage of specific market
developments. In the case of the Antwerp/Houston service, the link was aimed at the oil and gas sector, as well as a connection for cross-border
shipments into Mexico.
Contrary to the overall market development, the demand for additional in-network LCL ocean freight services continued to grow
throughout 2009 as the customer focus on safe solutions from door-to-door provided and controlled by one party remained high, Peter
Herling, Panalpinas global head of product and procurement ocean LCL, said in February. As changes in order frequency and size in many
cases no longer justified an FCL shipment, it became even more important to the customers that their goods now shipped as LCL shipments
were handled by the least number of parties, be it trucking companies, warehouse operators, handling agents or shipping lines.
But no ones network has been expanding as fast as that of DHL. Thorell said integrating the companys blueprint across a growing number
of markets is not too much of a challenge.
To be honest, we dont see that as an issue, he said. We have global, regional and country personnel in each market to operate the system.
Its a very structured product.
Among the more active markets for the LCL growth are all parts of Latin America, Singapore and Brazil to Los Angeles.
There are a wide variety of commodities moving by LCL nothing very specific, Thorell said. LCL is being used more as part of a
standard supply chain. There are a lot of commodities that move as LCL that we were used to seeing as FCL. Shippers now see this as a reliable
option.
Aside from merely expanding its network, DHL has also been opening centers in the Asia-Pacific region designed to drive LCL volume,
including six Fashion and Apparel Centers for Excellence in the region (with another planned in Shanghai by the end of 2010). In late May,
DHL launched a GPS tracking system as well as a garments-on-hangers service for its LCL shipments out of Colombo, the latest of the fashion
and apparel centers to open.
While maintaining a dominant position in the global market, DHLs parcel business had a rough go of it in the United States, leaving in early
18th Edition
2009 after entering the market in 2003 through the acquisition of Airborne Express. Company officials said, however, that the development of
DHLs other businesses (including LCL) has little to do with the U.S. exit.
DHL uses in-house non-vessel-operating common carrier Danmar Lines to arrange ocean service for its LCL services. That structure ties in
with the core of the product offering, Thorell said.
DHL Expands Clinical Trial Logistics Hub in Aomi, Tokyo
DHL has announced it has won a multi-billion dollar contract in Korea with leading drinks manufacturer Diageo to manage the company's
stock of premium alcohol in South Korea. Under the contract, DHL Supply Chain will provide warehousing and distribution services for the
company, supplying over 1,500 wholesalers nationwide.
Located in Incheon, the facility, operated by DHL, holds Diageo's inventory of wine and spirits for the Korean market. "We are delighted
with the appointment by Diageo and look forward to our partnership to deliver world-class integrated warehousing services. With a wellestablished hub and spoke network, DHL is well placed to provide complete end-to-end local distribution services," said JK Hur, Country
Manager, DHL Supply Chain, Korea.
With the appointment, DHL is working with Diageo to optimize its existing operations, which will result in higher efficiency and direct cost
savings.
"Korea is a key market for Diageo and the team evaluated a number of logistics solutions providers before deciding on this appointment.
With DHL's partnership and the enhancements in our supply chain, we hope to improve our customer satisfaction, increasing the frequency in
which we supplement stocks for our customers, and responding swiftly when they run promotions," said Jaehyun Seo, Supply Chain Director,
Diageo Korea.
DHL invests in outsourced service logistics sector
DHL is focusing on increasing its share of the 3 billion outsourced service logistics market in the Asia Pacific region, and its Supply Chain
division plans to invest 50 million over the next five years to expand its Technical Services offering, part of its overall Service Logistics solution.
DHL has mapped out expansion plans for China, India, Japan and Singapore, and aims to double its footprint in these regions.
According to Paul Graham, CEO of DHL Supply Chain, Asia Pacific, the company estimates that the logistics market is growing at about
25% per year. Of that, service logistics services, especially technical services and repairs, accounts for up to 60% of the overall spend.
"Harnessing the size and scale of our extensive footprint spanning 42 countries and territories in Asia Pacific, we have a unique opportunity
to bridge the market gap between companies offering technical repairs and logistics providers," said Graham.
He added that DHL's service logistics solution builds on a network of more than sixteen distribution centers and almost 500 field stocking
locations in Asia Pacific.
18th Edition
DHL operates from 400 sites in China and 470 locations in India, of which 15% of the company's sites in China and 40% of its facilities in
India support service logistics activities.
The company expects to double this number and increase its service logistics footprint in China and India within the next three - five years.
In Japan, DHL operates from a network of 270 sites, approximately 20% of which cater to service logistics.
In Singapore, DHL currently operates a 24/7 call centre for Europe and the Asia Pacific region for service logistics, and plans to launch an
Asia Pacific Center of Excellence for Solutions Development based in Singapore.
DHL has also launched its first technical services competency center in Asia, which is co-located at its 200,000 sq. ft. logistics hub in Bayan
Lapas, Penang in Malaysia. The facility is designed to offer integrated technical services solutions, from warehousing and distribution of spare
parts, to reverse logistics including screening, testing, repair and asset recovery.
The facility also houses an Authorized Service Provider (ASP) management team that supports services such as warranty verification and
spare parts purchases across Asia Pacific, and a technical call center to assist customers with advanced levels of repairs.
18th Edition
886-2-2790-7122
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1971
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Paul Chien
CEO
Mark Williams
Amy Lo
Marketing Director
Logistics Dir.
Jack Ruan
Edward Lin
383
64 **
2,000
Exchange:
TAI
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
100
Total Trucks:
512
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
Total Trucks:
40
Total Trailers:
Total Aircraft:
10
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.3
Total Tankers:
Total Other:
MAJOR MARKETS
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Dimerco e-Chain System
Transportation Planning and Optimization:
Warehouse Management System (WMS):
18th Edition
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Foxconn
Singapore
Huawei Technologies
Telecommunications
ITG
Singapore
Lite-On IT Corp.
Computer Peripherals
Logitech
Computer Peripherals
Beijing
Nortel
Telecommunications
Samsung Electronics
Hong Kong
Sony
San Francisco, CA
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Ireland
Canada
Hong Kong
Netherlands
United States
India
United Kingdom
China
Australia/New Zealand
Australia
Dimerco
Latin/South America
Indonesia
Japan
Malaysia
Singapore
South Korea
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Dimerco is a successful Chinese freight forwarder emphasizing Asia-U.S. lanes. Gross revenues are $383
million on a mix of air freight, ocean freight, warehousing and 3PL activity. Asia generates 84% of the revenue, the
Americas generates 14% and Europe accounts for the rest. Net income runs $7 million. Sister company,
Diversified Transportation, has trucking operations in China and Taiwan. Dimercos emphasis is on high-tech and
telecommunications.
Provider's Strengths
Already set up in China - UniGroup strategic alliance.
Provider's Weaknesses
2003: In 2003, Dimerco Zhongjing International Express (DIMZJD) was awarded honor certification from Beijing Finance Bureau due to our
excellent performance for China finance settlement by the year of 2002.
2003: To respond U.S. Customs issued Rules requiring ocean carriers and/or NVOCC's to submit a cargo declaration 24 hours before cargo is
laden aboard the vessel at a foreign port, Dimerco is certificated to transmit the corresponding required cargo manifest information directly to
the US Customs electronically through the Automated Manifest System (AMS), 24 hours before the vessel arrives in the port of departure.
2002: Dimerco has an established network of more than 100 service locations worldwide. This includes our own branch offices, Joint Ventures,
and partner agents covering the Greater China & South East Asia, North America, Europe, and Australia.
2001: Became the first and only freight forwarder and logistics service provider publicly listed in TASDAO (Taiwan OTC market) on 15th Oct.
2000: Implemented our Dimerco e-Chain System integrated with air/ocean freight, Warehousing/Logistics and Financial/ Accounting
management. This advanced new system gave us the capability to exchange data electronically (EDI, XML, FLAT FILE) with major customers
for greater supply chain visibility.
1999: Established a Centralized Settlement Program to streamline efficient account settlements among JV, agents, and Dimerco stations
1999: In 1999, Dimerco is awarded the No.3 Logo Design in the transportation group from the Intellectual Property Office (TIPO), the
Ministry of Economic Affairs, Republic of China
1997: Awarded as one of eight excellent customs brokers by Taiwan's Customs
1996: To provide better services to our customers, Dimerco established a joint venture company with Beijing Jin Mao Passenger & Cargo
Service, named Dimerco Zhongjing International Express in 1996 and continues to expand both locations and services in this fast-growing
market.
1995: Awarded the ISO 9002 certification in Taiwan (London: 1994, Singapore: 1995, Canada: 1997, United States: 1997, Jakarta: 1997, Hong
Kong: 1999)
1992: Completed EDI connection with Taiwan's Customs in November as one of the pioneers to provide an electronic customs clearance
service
1989: Implemented airfreight system called "DIM" (Dimerco Information Management) System consisting of Import & Export operation
modules integrated with "AccountMate's A/R modules", a 3rd party's accounting system.
1975: Became a member of the International Air Transportation Association (I.A.T.A.)
1971: Established the first office in Taipei, Taiwan and extended overseas network in New York, Hong Kong, Los Angeles, Chicago, London,
and Singapore
18th Edition
info@dsv.com
45 43 25 35 41
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1976
Asset Focus:
Market Area:
Founding Business:
International
Cartage
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jens Bjrn Andersen
CEO
Jens Lund
Jrgen Mller
CFO
DSV Air & Sea Holding A/S
6,856
1,690 **
Exchange:
21,280
700
1-10
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
6,000
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
23.7
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): GNTS, CargoLink, CargoWise edi
Transportation Planning and Optimization:
Warehouse Management System (WMS):
GNTS, CargoMate
RedPrairie, Infor/EXE, Logimax
GNTS
CargoLink
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Arla Foods
Food Production
Europe
B&Q
Specialty Retailers
Europe
Bayer
Chemicals
Europe
Bohler-Uddeholm
Metals
Europe
Bormioli Rocco
Europe
Clariant
Chemicals
Europe
DSM
Chemicals
Europe
Eaton
Industrial Machinery
Europe
Ferrari
Europe
General Electric
Diversified Financials
Europe
Europe
Hewlett-Packard
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Australia/New Zealand
DSV
Europe
North America
Latin/South America
Egypt
Bangladesh
Australia
Austria
Canada
Morocco
United Arab Emirates
China
New Zealand
Belarus
Mexico
Hong Kong
Belgium
United States
India
Bulgaria
Argentina
Brazil
Chile
Venezuela
Africa/Middle East
Asia/Pacific
Croatia
Indonesia
Czech Republic
Japan
Denmark
Korea
Estonia
Malaysia
Finland
Pakistan
France
Philippines
Germany
Singapore
Greece
Taiwan
Greenland
Thailand
Hungary
Vietnam
Ireland
Italy
Latvia
Lithuania
Luxemburg
Netherlands
Norway
Poland
Portugal
Romania
Russia
Serbia and Montenegro
Slovakia
Slovenia
Spain
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
DSV is primarily a non-asset operation. EBITS are 2.8%. Nearly half of its operations are European over-theroad and its Air & Sea division makes up over a third. Solutions (logistics) has revenues of $1.1 billion per year.
The DSV Group is Denmarks 2nd largest supplier of transport and logistics services. The Group originates in
the Nordic countries but is established with own operations in more than 60 countries in Europe, the Far East and
the Americas. Via professional and advantageous overall solutions, a worldwide yearly turnover of 4.8 billion is
realized by the Groups 21,000 employees.
ABX Logistics was acquired by DSV on October 1, 2008. ABX Logistics was included it DSVs financial
statements as of that date under the Air & Sea division, which grew 51% from 2007 to 2008 and continued to
grow nearly 4% in 2009.
Provider's Strengths
Integrated solutions with strong transport and distribution operations including temperature controlled.
Provider's Weaknesses
Mlnlycke Health Care has signed a three-year+ agreement with DSV, which includes final distribution into fourteen countries combined
with a tailor-made linehaul set-up.
In addition to the operational activities, DSV will support Mlnlycke in the development and roll-out of its logistics strategic plan.
The contract is valued at more than 50 million.
Mlnlycke's strategy focuses both on costs for the volume market and enhanced service offerings for the high-end market that the company
serves.
DSV Global Accounts provides a single point of contact for customers and facilitates the set up of a customized customer accounts
organization. Based on the customers' strategy and operational requirements, an optimum solution is created based on DSV operations. This will
provide more standardization across operations and improved transparency.
As DSV Road is present in all European countries, it enables logistics set-ups to be altered without having to change the carrier base.
DSV will also work with Mlnlycke to re-engineer the company's existing logistics structure.
DSV to Offer Logistics, Transport to Music Industry
18th Edition
The DSV Group launched a new division called DSV Entertainment Logistics, which will provide transport and logistics to the
entertainment industries with a particular focus on the music industry at the start.
The new division will be headquartered in the UK, where it will focus on the music, sport, TV & film, live events, exhibitions, theatre and art
sectors.
The company aims to focus on the music industry at launch and will provide services across the whole spectrum of the business from bands
just starting out through to global stadium tours.
"We see this as an area of great opportunity and potential growth particularly in live music," said Rene Falch, chief commercial officer of
DSV and managing director of DSV Entertainment Logistics.
The DSV Group, which is headquartered in Denmark, is one of the largest global logistics providers worldwide with annual revenue of
turnover of almost $6 billion and 21,000 staff in over 60 countries.
DSV gains market share
DSV Air & Sea and Inversiones Los Inkas have established a joint venture in Latin America. It started on 1 April and will operate under the
name DSV-GL.
Inversiones Los Inkas is the parent company of Goldenlogistics, which is already the current partner of DSV.
The venture will operate out of Santiago, Chile; Buenos Aires, Argentina; and Lima, Peru, with Colombia and Venezuela probably to follow
in the short-term and most countries in the region and the Caribbean within two years.
"Combining the overseas network of DSV with the in-depth know-how of our Partner in Latin America significantly strengthens our
position and capabilities in that region," said Jrgen Mller, president of DSV Air & Sea.
DSV takes 100% ownership of ABX Logistics in Australia
DSV has announced that it had acquired the remaining 60% of the shares in ABX Logistics (Australia) Pty Ltd to give it full ownership.
According to DSV, the revenue of ABX Logistics (Australia) for the financial year July 2007-June 2008 was AU$42,347 thousand (DKK163,840
thousand), with the EBITA figure being AU$2,595 thousand (DKK10,040 thousand).
ABX Logistics (Acquired by DSV 2008 previously acquired by 3i 2006)
October - DSV's completed acquisition of ABX Logistics from 3i Group has substantially strengthened DSV's air and sea freight operation.
Of DSV's 4.69bn turnover in 2007, its road division accounted for 63% and its air and sea division 25%. Conversely, for ABX Logistics, air and
sea transport accounted for 63% of its operations and road haulage for 23%.
The acquisition price of XB Luxembourg Holdings 1 SA, the parent company of the ABX Logistics Group, was 750m. According to DSV,
the expected synergies from its purchase of ABX Logistics would be DKK750m (100.5m) per annum when the integration was completed in
2011.
June - DSV entered into an agreement with 3i Group plc and 3i funds ("3i), the management team in ABX Logistics and other shareholders
to acquire all of the shares of XB Luxembourg Holdings 1 S.A., the parent of the ABX LOGISTICS Worldwide SA/NV Group ("ABX") of
Belgium.
Transaction Highlights:
The aggregate price of the entire share capital, on a debt and cash free basis (Enterprise Value) is EUR 750 million (DKK 5.6 billion).
For 2007, DSV and ABX had pro-forma combined aggregate annual revenues of approximately EUR 6.5 billion (DKK 48.5 billion) with
approximately 25,000 employees, and operated own transport networks spanning more than 60 countries.
2006
18th Edition
The company has faced financial problems in the last couple of years as many of its acquisitions have underperformed. It also had difficulties
in integrating the companies it purchased and unlocking the value of parcels, freight and logistics networks. In 2005 it had announced a restructuring program including the sale of selected subsidiaries and in 2006 it was acquired by UK private investment company 3i subject to
approval from the European Commission.
ABX was a subsidiary of the state run Belgian railways, SNCB, until was acquired by UK private investment company 3i. It has revenues of
around 2,400m and is headquartered in Brussels, Belgium.
ABX Logistics provides land, air and sea transport and logistics services. It employs some 8,000 people in 37 countries. Its overseas
organization consists of branches in 12 countries in Asia-Pacific and 7 countries in the Americas.
The company was established in 1993 as a domestic express parcels player in order to extend the scope of the rail freight operations. In 1998
the company embarked on an international expansion program in order to create a fully integrated logistics provider.
Its first three major acquisitions, on which the rest of the company was built, were Thyssen Haniel (Germany), The Dubois Group (France)
and Saima Avandero (Italy). From a European base it expanded worldwide with acquisitions in the Far East and the Americas. The majority of
its business however was in Europe and almost half was in road transport. Freight forwarding was also important whilst contract logistics was
the smallest element.
DSV to acquire ABX Logistics
Danish logistics group DSV A/S has entered into an agreement with 3i Group plc and 3i funds, the management team of Belgium's ABX
Logistics and other shareholders, to buy all the shares in ABX parent company XB Luxembourg Holdings 1 S.A.
The aggregate price of the entire share capital, on a debt and cash free basis, is 750 million euros ($1.16 billion). DSV said it would finance
the acquisition price through bridge financing facilitated by the current main banks of the group. The transaction is expected to be completed in
the third quarter of 2008, and is subject to approval by the relevant competition authorities.
The parties said the merger of DSV and ABX will create a company with pro-forma annual revenue of 6.5 billion euros ($9.5 billion) and a
workforce of 25,000, better positioning it to counter increasing competition in the transport and logistics sector, including from new Asian
players.
The management teams highlighted the geographic fit between the Northern European presence of DSV and the South and Western
European presence of ABX.
DSV and ABX will integrate their activities in air and sea, road and contract logistics to create operating and administrative synergies. The
integration is expected to be fully implemented before the end of 2011, when the margins of ABX are expected to be on a level with the margins
realized by the various divisions of the DSV Group.
Brussels-based ABX posted consolidated revenue of 1.8 billion euros in 2007, employs 6,700 full-time employees in 35 countries and
operates in 65 other countries through agents, partners and joint ventures. As part of the terms of the agreement, the ABX headquarters will be
maintained in Brussels through at least 2011.
"It is a great pleasure that we have succeeded to unite ABX and DSV," said Kurt K. Larsen, chief executive officer of DSV. "The match
between the two organizations is almost ideal, both geographically and in respect of activities. For a number of years, ABX has been at the top
of the list of potential combination candidates." Laurent Levaux, CEO of ABX, said: "Beyond our geographical complementarities, both CEOs
share the same values of customer focus, entrepreneurship and managers' empowerment.
"This strategic alliance is also excellent news for Belgium, which created the ABX Group through the Belgian Railways between 1998 and
2001 and is a natural hub for logistics activities and multimodal transportation," he added.
Robert Van Goethem from 3i Partner, said: "The freight forwarding market continues to undergo considerable consolidation. (The) merger
of ABX and DSV will significantly strengthen the growth potential of ABX's activities as it will be able to benefit from a much larger network
effect.
"The timing of (the June 21) transaction was not planned nor anticipated when 3i, ABX management and the other shareholders bought the
business. However the business is well ahead of its milestones. The board of ABX and all shareholders decided a merger between DSV and
ABX provided an excellent opportunity at the next phase of development for ABX's activities and that it is in the best interest of the company,
its shareholders, its management and the local Belgian economy," Van Goethem said.
18th Edition
49-5-41-56 05-2-22
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1949
Asset Focus:
Market Area:
Founding Business:
Europe
Automotive Transport
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jean-Michel Floret
Axel Henneble
Dirk Freese
Marketing
Operations
Friedhelm Rolf
Reinhard Pieck
CFO
Technical Services
88
Ticker Symbol
88 **
Exchange:
568
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
250
Total Other:
Total Reefers:
Total Flatbeds:
3.7
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): FLAIS
Transportation Planning and Optimization:
Warehouse Management System (WMS):
FLAIS
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Audi
Europe
BMW
Europe
General Motors
Europe
Honda Motor
Europe
Jaguar
Europe
Mazda Motor
Europe
Mitsubishi Motors
Europe
Nissan Motor
Europe
Porsche
Europe
Saab
Europe
Toyota Motor
Europe
Volkswagen
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
Egerland
Latin/South America
Austria
Belgium
Czech Republic
France
Germany
Luxembourg
Netherlands
Poland
Spain
United Kingdom
EDITOR'S COMMENTS
Provides complete auto finishing and delivery service.
Provider's Strengths
Automotive logistics and transport.
Provider's Weaknesses
Size and geographical scope.
In order to improve performance and efficiency towards the clients Werner Egerland Automobillogistiks GmbH & Co. KG, Osnabruck, and
the French Societe de Transports de Vehicules Automobiles (STVA), Paris, likewise specialized in the field of automobile logistics, have signed
an agreement for technical co-operations with Egerland France S.a.r.l. in Forbach and the STVA.
Since 1998 Werner Egerland Automobillogistik GmhH & Co. KG is represented on the French market with its subsidiary Egerland France
S.a.r.l. operating a service center as well as considerable cargo fleet.
WERNER EGERLAND wins the European Car Carrier Award
WERNER EGERLAND Automobillogistik GmbH & Co. KG has been honoured with the European Car Carrier Award 2000 (ECCA
2000). The DaimlerChrysler AG conferred this prize, which takes the shape of a glass pyramid, on the best carrier in the field of vehicle logistics
for the first time. The company, which conducts business throughout Europe, surpassed 23 other major European carriers.
For one year all competitors had to stand stiff examinations, with special attention being paid to the quality of new-car transports. Criteria
such as loading safety, delivery periods, charges and the quality of the fleet of trucks appeared on the checklist alongside the drivers kindness
and competence as well as the condition of their transporters. According to testers statement two criteria were decisive in awarding the prize to
the Osnabrck company. The first is the so-called "closed concept", whereby new vehicles are delivered directly to the merchants showrooms in
dustproof and waterproof transporters, after having been fully prepared in an +egerland+ logistic centre. The second is the internet link within
E-commerce, which enables DaimlerChrysler employees to order vehicles in the +egerland+ centres selectively.
18th Edition
49 2 21-83 29 90
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1928
Asset Focus:
Market Area:
Founding Business:
International
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Herbert Putzmann
Managing Director
Wilbert Herff
361
Ticker Symbol
361 **
Exchange:
1,800
ASSETS
Total Transportation Assets:
Total Tractors:
30
Total Trucks:
Total Trucks:
150
Total Other:
Total Trailers:
Total Aircraft:
190
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.7
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
BMW
Germany
Volkswagen
Germany
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
Emons
Latin/South America
Belarus
Bulgaria
Czech Republic
Germany
Italy
Lithuania
Poland
Romania
Russia
Switzerland
Ukraine
EDITOR'S COMMENTS
Emons provides contract logistics express transportation including on-time deliveries, warehousing and some
freight consolidation. The warehousing data shown is for Germany only.
Provider's Strengths
Express services throughout Europe.
Provider's Weaknesses
Niche and geographical limits.
18th Edition
0031-77-3202222
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1906
Asset Focus:
Market Area:
Founding Business:
International
Transportation
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Rudi Roex
CEO
B. van Rens
C. Peters
W. Tosserams
R. Sohl
CFO
CIO
853
Ticker Symbol
682 **
Exchange:
1,500
ASSETS
Total Transportation Assets:
Total Tractors:
350
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
2,700
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
1,900
3.2
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Industrial
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): ICARE
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Manugistics--TM Suite
Manhattan--PkMS
Quintiq Networks
ICARE
ICARE
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Borealis
Chemicals
Europe
Ford Motor
Europe
General Motors
Europe
Europe
IKEA
Specialty Retailers
Europe
Johnson Controls
Europe
Michelin
Europe
Nissan Motor
Europe
Saab
Europe
Scania AB
Europe
Tenneco Packaging
Packaging, Containers
Europe
Volvo
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
China
Europe
North America
Ewals
Latin/South America
Belgium
Czech Republic
Estonia
Finland
France
Germany
Italy
Lithuania
Netherlands
Poland
Romania
Russia
Slovakia
Spain
Sweden
United Kingdom
EDITOR'S COMMENTS
Ewals started as an automotive transporter and added contract logistics. It provides integrated services (valueadded transportation, cross docking and storage) on a regular basis.
Provider's Strengths
Integrated automtive logistics.
Provider's Weaknesses
Ewals Cargo Care, the Netherlands-based logistics service provider, celebrated its 100th birthday last year. Sam Oogle spoke with CEO Rudi
Roex about the challenges and opportunities in todays automotive logistics industry.
Ewals Cargo Care (ECC) is a 100 percent family-owned logistics provider employing 1990 people at 49 sites in 18 countries. Last year, the
company turned over 515 million euros and it was recently nominated amongst the top three best 3PLs at the European 3PL Summit. "To be
nominated amongst the three best 3PL providers in the automotive industry is recognition that we are developing in the right direction," says
CEO Rudi Roex. "The theory of continuous improvement is not, for us, just a theory. It is a reality that our people are offering to our
customers by working together with them to find integrated solutions."
ECC is involved principally with inbound logistics from suppliers all over Europe on a just-in-time basis into vehicle assembly plants. It
works with all the European OEMs with the exception of Volkswagen, Fiat and the PSA Group and also numbers many tier suppliers amongst
its customers. The service it delivers to the automotive industry can be divided into three main divisions which the company identifies as Move,
Store and Manage. One element is everything to do with moving goods, the second is the storage of goods, whether virtual or physical, and the
third is the management of logistics flows.
ECC moves goods by road using its own fleet of 4,500 units. This includes 3,000 one hundred cubic meter Megatrailers, an ECC innovation
from 1990 which has now become the standard transport resource for the automotive industry. "We originally developed the Megatrailer for the
RoRo business between the continent and the United Kingdom," explains Roex. "Later, we extended its use to Scandinavia as well. It has a roof
which can be raised by 20 centimeters and then lowered to its original position. This means that the full 2.96 meters internal height can be
utilized. The automotive industry has adapted its packaging to the Megatrailer so that, instead of stacking automotive racks two-high in the
standard trailer, they can now be stacked three-high."
Road transport in Europe is facing many challenges including increased congestion, increasing toll charges and a shortage of drivers. "The
legislation governing road transport has changed from April of this year, and the Working Time Directive means that you are unable to drive as
much as you were before," says Roex. "This means less overtime for drivers, who move to other jobs. The alternative to moving goods by road
is to move them by rail. We have chosen to invest in this mode and we now own 15 dedicated block trains traveling between Germany/Belgium
and Italy. We have roughly 1,500 swap body wagons, and we are currently investing in Mega Huckeback trailers which are used intermodally for
transferring goods from the road to the rail and vice versa."
ECC's 'Store' division has 450,000 square meters of warehousing and cross-dock facilities across Europe. "The 'Store' concept extends
beyond simply handling and storage," says Roex. "It also includes a large range of value-added services throughout the automotive supply chain.
Activities such as labeling, re-packaging, pre-assembly of components in line with production plans and sequencing. Also the collection of
components from all over Europe and the building of complete knock down units for shipment worldwide.
"Another element of 'Store' is virtual warehousing, or what ECC terms a warehouse on wheels. This is where a trailer full of parts is standing
in the yard of the assembly plant and is off-loaded the moment the components are needed at lineside. "We have to know exactly the sequence
in which the parts are required," says Roex. "We also have to instruct the supplier where we are loading and how it must load in order that the
parts are in the right sequence for the receiving plants. It needs to be a very reliable system. It is also, of course, a way of reducing inventory at
the assembly plant, and it means that we have to manage the complete supply chain in order to ensure that the components are so arranged that
there is no disruption when they are off-loaded. Of course, we have all the warehouse management systems and supply chain management
systems to support us in providing our customers with the correct service."
ECC's 'Manage' division is non-asset-based and makes use of the wider transport market. Acting as a freight forwarder and freight manager,
the company is the single point of contact for all required transport modes and destinations.
ECC also acts as a 4PL, notably for Scania AB. Through its 100 percent owned independent subsidiary, e-Logistics Control, it manages the
18th Edition
collection of parts from all Scania's suppliers in Europe and organizes transportation into the Swedish company's 16 production units. "This
means that we are optimizing and integrating the transport flows almost every day, whilst providing Scania with real time information," says
Roex. "If we have built a milk run, we have to adapt that milk run to the volumes and create an optimal flow time and time again. We are
consistently thriving for continuous improvement. That's our job. If a company is a groupage specialist in Italy, it doesn't necessarily mean that it
is also a groupage specialist in Sweden. E-Logistics Control looks for the best partner for a particular service in a particular area of Europe. It
organizes, controls and optimizes the integrated flows to ensure that Scania receives its parts on-time at its factories."
The relationship between the OEM and the 3PL is very critical to the success of the partnership. "There is a lot of pressure on the big
OEMs' supply chains and we must avoid creating cost," says Roex. "They depend on the collaboration of their suppliers, of which we are one.
In order to fulfill our task we continuously have to optimize the flows but we also need the cooperation of the customer because sometimes we
are not at the wheel, not driving the car. The relationship is based on trust. We come up with solutions and ideas which they have to defend
internally. They need a relationship of trust based on proven history; a proven track record."
Many logistics providers today complain about pressure on rates from the OEMs leading to an erosion of their margins as costs increase.
Whilst acknowledging that the pressure on rates exists, Roex believes that there should be more focus on the cost element. "It is not purely
about rates," he says. "We have to think about reducing costs, not about reducing margins. Together with our customer we have to look for
other ways of moving the goods from A to B. We have to do it differently to be able to stay competitive in the market. And we have to do it
together. It is more a partnership than just a supplier/customer relationship."
Another challenge facing both OEMs and service providers is the emergence of suppliers in low-cost countries, often geographically distant
from the traditional automotive assembly sites. Longer supply chains are the inevitable consequence meaning that more equipment is needed to
transport the same volume as before. "There is a high demand for transport capacity and at the moment there are not enough people to drive
the trucks," says Roex. "This is why we have to look for alternative modes and why we have invested in intermodal solutions.
"The second element that needs to be looked at is the potential effect on plant inventory," he adds. "If your suppliers are located near the
factory which they supply, then there is no need for much inventory. If, however, the suppliers are 2,000 kilometers away, you need reliable
partners who can give you good information on the goods over the whole length of the chain. The 3PLs have to assist the OEMs to ensure
reliability of supply in order that the build-up of huge inventories can be avoided."
One of the biggest issues facing any transportation company is the need to avoid wasteful empty running. When the fleet is as large as ECC's,
the consequences could be extremely costly. "Some weeks ago in Holland, we won the Computable Award 2007 for the best ICT project of the
year in transportation and logistics," Roex points out. "We have developed systems that give us a transparent view of our planning, our fleet and
how it is dispatched to avoid too much empty mileage. You avoid the issue by building systems that give visibility and tell you what truck is
where. We pre-plan for loads and, of course, unforeseen things can happen. Drivers can become ill or deliveries can be affected by congestion,
but we have the ability to alter the planning at the last minute."
Reducing empty running also has a beneficial effect upon a company's environmental profile, but it is not the only way in which ECC aims to
reduce its carbon footprint. The company buys new trucks with Euro5-compliant engines. The Megatrailer carries 50 percent more goods than
its predecessors, and the company also has in its fleet trailers that can be loaded on two floors, meaning that one truck can do the work of two.
As much use as possible is made of unaccompanied transportation by short-sea shipping, and rail continues to be an important mode.
Ewals Cargo Care Nominated for Best 3PL in Automotive Industry
On Monday November 5th Ewals Cargo Care was nominated among the top 3 Best 3PL's for the Automotive Industry during the Fifth
European 3PL Summit.
The European 3PL Summit brings together all major players in the European (and global) logistics market, as well shippers as logistic service
providers. In the weeks preceding the event shippers were invited to nominate their Best 3PL in different categories such as retail, industrial and
automotive. Nominations were given to logistics companies such as Maersk Logistics, Kuehne & Nagel, DHL, Ceva Logistics (former TNT
Logistics), Schenker, etc.
In this exclusive list Ewals Cargo Care was nominated among the top 3 for our services to the automotive industry. Mr. R. Roex (CEO): "as
this nomination was given to us by our customers, (logistics companies were not entitled to vote) this nomination is a great recognition for the
quality of service and customer commitment that all of our staff delivers every day"
Ewals Cargo Care continues Acumen activities
As from April 5th 2004 the activities, carried out by Acumen Distribution Services Ltd. until now, are going to be continued by Ewals Cargo
Care. This change is a result of the decision of the parent company of Acumen, the British Autologistics Holding, to reduce the activities from
Acumen as from that date.
To ensure the continuation of the activities, a number of the Acumen employees are going to be employed by Ewals Cargo Care. In total it
involves 49 employees divided over three offices in Belgium, France and the United Kingdom.
Furthermore the trailers from the Acumen fleet will be integrated into the current fleet of Ewals Cargo Care. As a result the Ewals Cargo
Care fleet grows from 3500 to 4300 units.
3000 of these units are MEGA trailers, which is further strengthening the position of Ewals Cargo Care as the leading MEGA-operator in
Europe.
In the first phase the activities of Acumen, which mainly focus on automotive transports from and to the United Kingdom, continue as a
separate division within Ewals Cargo Care. In the next phase, the activities are going to be integrated with the current traffic-lines of Ewals
Cargo Care. This amalgamation fits in with the strategy of Ewals Cargo Care to have a leading position within the European Automotive
transport market, where it already has a well-established reputation.
This expansion of business is complementary to the current activities of Ewals Cargo Care. Ewals Cargo Care is active as logistic service
provider for several industries. Because of the further integration of the cross channel traffic, Ewals Cargo Care is able to strengthen its position
within the cross channel market.
Integrated Logistics in the high-tech industry
The problem
One of our clients in the high-tech industry challenged us to provide an outsourcing solution for one of its four product types. As a result, the
client would be able to concentrate primarily on its core business: the manufacturing process.
Our solution
18th Edition
After an analysis of the logistical process we decided for a supply chain solution. Since our client uses the 'make-to-order' principle, sales orders
are the starting point in this particular supply chain process. The sales order initiates a procurement of modules from strategic suppliers. About
100 strategic suppliers prepare the various modules, whereupon Ewals Cargo Care takes care of the collection and the shipping to the
distribution centre. After a visual check, modules are repacked and shipped to one of the three production plants. After assembly, the final
products are distributed to customers all over Europe, the United States and Asia. A reverse logistic path is used back to suppliers. Ewals Cargo
Care takes care of the pre-finance and insurance of all modules and final products. Invoices are sent after delivering the final products to the
clients customers.
Result
With this solution, our client is able to precisely predict its logistics costs. Furthermore, the client can compare efficiency results with its former
logistical process and is able to concentrate on its core business. Due to a weekly reporting system, the client is continuously aware of our
performance based on the service level agreement.
18th Edition
206-682-9777
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1979
Asset Focus:
Market Area:
Founding Business:
Global
Ocean Freight
OVERALL CAPABILITY
Overall Capability of Provider:
Tier 1 global supply chain manager with presence in most major markets.
KEY PERSONNEL
Peter Rose
Tim Barber
R. Jordan Gates
Bradley Powell
Jeff Musser
CFO
SVP & CIO
4,092
1,383 **
Exchange:
12,010
NASDAQ
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
0
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
0
0
55
8
Total Ocean:
Total Other:
0
0
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Healthcare
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Tradeflow, exp.o
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--ECMS
D-Pad
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
ACE Hardware
Specialty Retailers
Bombardier
Cisco Systems
Dell
Dollar General
General Merchandisers
Gap
Specialty Retailers
General Electric
Diversified Financials
Hewlett-Packard
J.C. Penney
General Merchandisers
John Deere
Pharmaceuticals
Lands' End
Apparel
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Bahrain
Botswana
Cambodia
Fiji
Belgium
Mexico
China
Guam
Bulgaria
United States
India
New Caledonia
Croatia
Indonesia
New Zealand
Czech Republic
Argentina
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Jamaica
Nicaragua
Panama
Paraguay
Peru
Puerto Rico
Uruguay
Cameroon
Congo (Dem. Rep.)
Cte d'Ivoire
Cyprus
Egypt
Japan
Ghana
Korea
Iraq
Malaysia
Israel
Jordan
Nepal
Australia/New Zealand
Expeditors
Angola
Africa/Middle East
Asia/Pacific
Denmark
Kazakhstan
Estonia
Finland
France
Germany
Greece
Pakistan
Hungary
Kuwait
Philippines
Iceland
Lebanon
Singapore
Ireland
Libya
Madagascar
Sri Lanka
Italy
Taiwan
Latvia
Thailand
Lithuania
Vietnam
Malta
Kenya
Malawi
Mauritius
Morocco
Netherlands
Mozambique
Namibia
Norway
Poland
Nigeria
Portugal
Oman
Qatar
Saudi Arabia
Romania
Senegal
Slovak Republic
South Africa
Slovenia
Tanzania
Spain
Tunisia
Uganda
Sweden
Russia
Switzerland
Turkey
Zimbabwe
Ukraine
United Kingdom
EDITOR'S COMMENTS
Expeditors is the largest, best run North American-based freight forwarder. It continued its strong organic
growth in 2008, growing by 7.6%. Net revenues reached $1.6 billion and produced an 18.8% gross margin in
2008. 2009 was a difficult year but revenues have roared back in 2010.
Net revenues are 45% air freight forwarding, 23% customs brokerage and 32% ocean freight forwarding. U.S.
and Asia business account for 76% of revenues. Expeditors is the largest forwarder/NVOCC in the Asia/U.S. lane.
It handles 746,000 million TEUs per year with a 4:1 imbalance. 448,000 TEUs are from China to the U.S.
Expeditors European operations are primarily in airfreight and constitute 15% of revenues, growing 16% in 2008.
Expeditors net revenues are 40% high-tech, 33% retail, 10% pharmaceuticals, 10% automotive, 5% furniture and
2% other. Expeditors limits its participation in value-added warehousing and distribution.
Provider's Strengths
Peter Rose and his colleagues are operationally strong, team oriented and profitable.
Provider's Weaknesses
In the 30 years since its founding, Expeditors has grown to a $5.6 billion company with 110 locations and 12,300 employees. Theres no
doubt that Expeditors has been extremely successful. The primary feature has been Rose and the small group around him who have done such
an excellent job, Armstrong said.
Thats particularly true in Pacific trade. Expeditors handles about twice as many TEUs as its nearest competitor on the China-U.S. lane, and
theyre the dominant player in air freight, he said.
Expeditors took a hit from the recession, but the company adopted a no-layoff policy. Thats a very noble approach to take and good for
company morale, Armstrong said. Rose says its also good for business. So far, weve done well positioning ourselves and have typically come
out of these slowdowns more resilient and more efficient than we were when we went in, the company said in its most recent SEC filing.
Healthcare Case Study Temperature Controlled Solutions
Challenge
A healthcare client needed a more cost efficient solution to a shipping lane that had utilized a complex active system while continuing to
maintain the products temperature.
Strategy
Draw on our healthcare expertise and operations knowledge to analyze multiple package technologies and determine which option would
meet our customers challenge.
Solution
We collaborated with the customer to ultimately replace their active system with a passive shipping system. The passive system was a simpler
process to manage, more cost effective, ensured product integrity by maintaining temperature between 2-8C and was more environmentally
friendly by utilizing dry ice and batteries.
A leading global healthcare company, with multi-billion dollar sales, was looking for alternative solutions for a shipping lane in which an
active system was being utilized to maintain the product temperature, as per customer requirements. Our customers main goal was to move the
product from Europe to the consignee in Puerto Rico in a cost efficient manner while maintaining product integrity through temperature control.
There were five shipments per year. The product was contained in drums which were fastened to pallets by straps and needed to remain
between 2C and 8C during transport.
The current method of shipping was an active system requiring auxiliary components to maintain temperature throughout shipping. As a
leading service provider to healthcare companies throughout the world, we continually keep current with packaging technology.
With this knowledge, we were able to look at a passive shipping system as an alternative solution.
We looked at both active and passive solutions. For the active solutions, we looked at two specific size units. For the passive solutions, we
looked at both the single-use and reusable packaging. Validation data was also carefully reviewed for the passive solutions. By incorporating
shipment specifications, transportation costs and packaging costs, we determined that the most cost efficient solution was the single-use passive
packaging system.
As with any temperature controlled shipment, it was important that the routing chosen minimized transit time and transfer points.
Expeditors chose one of our key airline partners that operated a direct flight from Europe to San Juan. Touch points were minimized by moving
the product at origin from shipper to airport via temperature controlled truck. Standard Operating Procedures were developed at origin and
destination to define roles, communication, handling procedures, data capture, packaging specs and contingency plans to assure the product
moved as planned within time constraints specified.
Once our customer agreed to the solution proposed, a test run was performed with a placebo during summer months. The test demonstrated
the product temperature was held to requirements and the new solution was implemented. Savings for the new solution were calculated to be
more than $200,000 over a five year span. Along with cost savings, our customer also acknowledged the environmental advantage of using a
passive system, which utilizes dry ice and batteries, over an active system, which requires energy.
Distribution to Retail Stores Case Study Middle East
Challenge
Maximize merchandise availability through an outsourced management and distribution operation in the warehouse to support the customer
s growing chain of retail stores and release their managements time from logistics functions.
Strategy
Partner with the customer in order to take on a management role in the customers warehouse for improvement of processes and training of
customer warehouse staff. Assess the current distribution operations and integrate Expeditors Distribution Management System.
Solution
Through the deployment of tried and tested warehouse operational processes, the retailer increased the availability of merchandise in their
stores as well as released management time from non-core functions. Inventory control procedures coupled with Expeditors Distribution
Management System improved the accuracy of inventory reports both the stores and buyers use to make replenishment decisions, helping to
maximize store sales.
A Qatar based conglomerate set up a retail division and began purchasing merchandise from internationally recognized luxury & casual
brands. Initially, they undertook stock holding and picking of the apparel, footwear and accessories themselves for delivery to stores. As both
the number of retail stores and the number of brands represented increased, managing a seasons inventory became complex. In-store availability
and sales suffered. They knew they needed to partner with a logistics service provider with a track record in providing warehousing and
distribution services to multi-line retailers in fast growing retail markets.
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The first phase of the process involved Expeditors taking over the management of the retailers existing warehouse. Using best practices
from similar operations within the Expeditors network, the legacy operational procedures employed within the customers warehouse were
revised to improve inventory accuracy and management over the course of a season. Expeditors warehouse supervisors trained the customers
existing warehouse staff in the new work processes and use of Expeditors Distribution Management System (EDMS).
Expeditors Distribution Management System (EDMS) improved visibility of stock and increased the accuracy of the inventory reports used
by the retail stores and the buyers. This enabled buyers to make better informed decisions on re-order quantities, which in turn increased the
speed of replenishment to the retail stores. The combined result helped maximize sales.
The floor plan of the warehouse was also re-configured by brand and departments within the retail store. This simplified picking and
improved accuracy. Grouping merchandise by department and brand enabled merchandisers to visualize the stock on hand and to create
collections and display themes which were then picked and delivered to the retail stores.
Key to inventory accuracy was the new receiving process. Expeditors would upload order details from the customers Retail Management
System into the Distribution Management System (EDMS) and check the merchandise received against the original order. The order data was
also used to print the bar code labels, which were then applied to the merchandise. These labels get scanned, the merchandise put away and
EDMS is automatically updated, giving the retail stores, merchandisers and buyers the up-to-date in-stock information. The receiving process
also included removing any bar code labels previously attached to the garment and placing the security tag appropriately on the merchandise.
At the time the merchandise departs for the retail stores, the bar code labels are re-scanned. The inventory record in EDMS is changed
accordingly and the retail stores expected receipt data is updated in the customers Retail Management System, giving them full visibility of the
process.
These processes and disciplines will be extended to support subsequent brands and merchandise. The combined operation will be relocated
to an Expeditors facility to accommodate the sales growth forecast.
LOGISTICS: IT'S ABOUT TIMING
Rates may be declining, but shippers shouldn't count on the benefits of overcapacity too quickly
WHEN EXPEDITORS INTERNATIONAL of Washington announced its first-quarter results this month, the company suggested a bleak
picture for international trade: Shipping volume was down sharply, ocean revenue fell 28.7 percent and air freight revenue plunged 37.6 percent.
Yet the $5.6 billion forwarder kept its net profit decline to just 11 percent, at $59.3 million, and the company recorded record-high margins in
air freight (up 10 percent), and near-record margins in ocean freight (up 5.9 percent).
The paradox, it seems, is all a matter of timing. Like other non-asset-based logistics providers, Expediters did not immediately pass on to
shippers the lower rates it paid to capacity-challenged air and ocean carriers. As a result, many shippers paid more for the transportation services
than market conditions seemed to dictate.
That process occurs during every notable downturn, said Evan Armstrong, president of logistics consulting firm Armstrong & Associates,
when the basics of supply and demand take on a critical extra dimension. "It is a timing issue," he said. "Whenever shippers lock in their
contracts, if capacity is underutilized on the carrier side, then a
3PL can negotiate better rates for the capacity than its customers can."
When that happens, non-asset-based logistics providers can enjoy higher gross margins; the larger the 3PL, the better the rates and the higher
the margins.
"You need some size and scale to allow you to control your margins significantly,"
Armstrong said.
Other large non-asset-based 3PLs benefiting include C.H. Robinson, Kuehne + Nagel, Panalpina and the logistics divisions of DHL and
UPS. The conditions also favor huge shippers such as Wal-Mart, which has its own international transportation department to negotiate directly
with transportation providers.
Those high margins won't last forever. The flipside of the process, Armstrong said, occurs whenever capacity becomes tight. During the late
1990s, for example, rates rose and service providers' margins were squeezed to the point they started rejecting loads that were clearly
unprofitable.
Jon Langenfeld, financial analyst at Robert W. Baird & Co., said Expediters' long-term strategy is to "buy transportation at very attractive
rates, and pass on that rate to customers. But rates have fallen so far and so fast on both air and ocean, it is hard for them to keep up. They are
working through contracts to reprice, but you can't do that overnight."
Armstrong believes the market has bottomed out, and volume will start to grow again during the third or fourth quarter. But capacity-will
continue to outstrip demand, so rates will stay depressed for most of 2009. That means 3PLs will be able to have some control over margins
through the end of 2009, he said.
Langenfeld said it will take another 12 to 18 months for "decent growth" to return to the market, but many shippers won't have to wait until
the market fully recovers to get lower rates.
"Already, freight forwarders have started to give concessions to some shippers," he said, and shippers will start to see double-digit declines in
rates before long.
Armstrong said the only way to make sure transportation prices always reflect existing supply and demand would be to create an electronic
marketplace for trading transportation futures.
"Someday, we'll trade transportation the way we trade pork bellies," and other commodities such as corn and soybeans, he said.
Transportation/Logistics Research [By Jon A. Langenfeld, CFA, Robert W. Baird & Co., December 20, 2007]
Expeditors International of Washington (EXPD)
Recap of Recent Management Meeting; Long-Term Outlook Remains Attractive
We recently met with EXPD CEO Peter Rose and CFO Jordan Gates. We note, as announced last month, effective January, CFO Gates will
be promoted to President and COO, replacing Glenn Alger who retired earlier this year. And while a CFO successor has not yet been named,
the process to select a replacement has progressed as planned with both internal and external candidates being evaluated. Below we further
highlight our takeaways from our meeting:
Growth Opportunities. Not surprisingly, management continues to see as many opportunities to grow the business today as they have seen over
the past several years. EXPD therefore expects continued growth of 15-20%, within its long-standing targeted range, which we view as a very
reasonable target given EXPD maintains less than 5% share in its addressable forwarding market. Below we highlight different areas of growth:
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Growth in Existing Offices. Management noted that EXPD continues to expand on its current base of over 240 offices by adding new
locations. However, they noted that growth at a number of the established locations continues to keep pace with overall company growth. Samestore office growth as reported quarterly by EXPD has roughly matched overall growth over the past six years. We believe these figures and
management commentary support our view that growth opportunities are abundant and operating margin expansion should continue as the
company leverages its existing network.
Asia-Europe Trade Lane. EXPD believes that the Asia-US trade lane should be "at least" as big as its presence in the Transpac lane. We
continue to see this as a bullish growth opportunity, as we estimate EXPD's Transpac net revenue is currently three to four times the size of its
Asia-Europe activity. EXPD sees tremendous opportunity in this trade lane, which has likely been helped in the near term by acquisition
integrations among the largest European forwarders and the bribery scandal at Panalpina. We believe, and management agreed, that Kuehne +
Nagel is the strongest competitor on the Asia-Europe lane.
US Exports. EXPD confirmed that it has participated in the rising US exports. Largest export customers for EXPD include Cisco, HP, Dell,
Schlumberger, Smith International (Oil & Gas), Merck, John Deere, Terex Corporation, and Case New Holland.
Intra-Asia and India. While both are relatively small parts of EXPD's overall business, management sees attractive growth prospects in both
these regions. Intra-Asia has been the fastest growing region in recent years, albeit of a very small base.
As the chart below shows, EXPD continues to grow well in excess of the market growth rate, which is a function of EXPD's better service
offering given its unified global culture and IT solution.
Forwarding Net Revenue Growth
EXPD
C2003
Air -2%
Ocean 17%
C2004
25%
10%
Kuehne
+ Nagel
Air 6%
Ocean 17%
15%
13%
11%
21%
14%
21%
14%
8%
16%
13%
22%
16%
Panalpina
Air 6%
Ocean 3%
13%
11%
11%
14%
8%
22%
26%
5%
19%
13%
13%
10%
UTIW
Air
Ocean
27%
32%
15%
20%
13%
24%
14%
17%
15%
18%
17%
15%
5%
10%
5%
10%
2%
8%
4%
10%
4%
7-8%
26%
13%
Mkt Vol
Air 4%
13%
Growth
Ocean 7%
11%
Source: Company data, Baird estimates
Domestic North American Offering Progressing; Europe and Asia Are Next. Launched in 2003, EXPD's North American Transportation
(NAT) offering was designed to leverage the company's existing expertise in procuring and managing domestic freight carriers while offer
existing customers domestic US forwarding services with a focus on time-definite and expedited shipments. True to its original charter, NAT
has progressed slowly but steadily and management has been happy with the success. EXPD expects to roll out the expedited ground offering in
Europe and eventually in Asia. While representing a very small part of the business, the intra-continental expedited shipping could eventually add
1-2% to net revenue growth.
Capital Expenditures. Back in 2002, EXPD began additional capex spending on strategic property and facilities development. With a rising cash
balance and no desire to do acquisitions, management believes EXPD generates attractive returns when buying/developing property that is in a
location they plan to occupy for ten years or longer. Management expects this added capex spending to wind down, but added development
opportunities still exist in China and in UK. As such we expect elevated capex, but recognize the company will eventually migrate toward
normalized capex which has been running in the $40-50 million annually.
Capital Expenditures ($ millions)
Maintenance Facility Total
% of
Capex
Capex Capex Net Rev
2002
22
90
113
16.5%
2003
21
0
21
2.8%
2004
42
24
66
7.3%
2005
26
65
91
8.6%
2006
51
56
106
8.2%
2007E
45
35
80
5.5%
2008E
45
30
75
4.5%
Source: Company filings, Baird estimates
Property/Facility Development
Real estate and office/whs in NJ, CA, and UK
Real estate and office/whs in NY, CA, and Korea
Real estate and office/whs in TX, WA; development in CA, WA, TX
Real estate and office/whs in FL; development in WA, TX
Office in Hong Kong
DHL remained the top forwarder in the US and Mexico in 2005, while Exel was again number one in Canada according to the latest data.
Based on last years figures, the two groups would have dominated the local markets with a combined figure of some $235 million for the
US, well ahead of Expeditors second place ranking with $113.5 million of the combined $160.8 million for BAX and Schenker, who were placed
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For a perspective from the ground up of Expeditors International of Washington Inc., a Seattle-based global logistics company now in its
25th year, the parking garage is a good place to start.
Among generally upscale vehicles in the garage, which is under a downtown Seattle building owned by Expeditors, a certain Range Rover
would have little interest for outsiders.
Within the company, it is know that the Range Rover belongs to Peter J. Rose, Expeditors chairman and chief executive officer. It is also
known that Rose himself not the company pays for his parking slot, like any other employee.
Twelve floors up, in Expeditors decently appointed but far from palatial offices, Rose expressed in an interview the pride he feels in his
companys strong performance.
Expeditors had $3.3 billion in gross revenues in 2004 and net earnings of $156.1 million. The company has come a long way since being
registered in 1979 as a single-office ocean forwarder in Seattle.
Rose and his co-founders started Expeditors with $300,000 and a very debonair attitude, he recalled. We didnt know how it would turn
out.
For his part, Rose used every last liquid asset I had, and then borrowed from his daughters life insurance policy to assist in capitalizing
Expeditors.
By 1981, we had 20 people in six offices. Today, we have 9,500 employees in 183 offices and all of that growth was done organically, he
said.
Because weve made it very clear that Expeditors is not for sale, one myth you hear about us is that we are acquisition-adverse, he said.
Nothing could be further from the truth. Weve probably done 18 acquisitions over the years. Theyve all been organic, meaning that weve
bought an existing agent that we had come to know and trust for at least five or six years first. Those acquisitions were really quasi-joint venture
mergers.
It is quite common for a company thats interested in being sold to sing a we-arent-for-sale mantra right up to the announcement of its
acquisition. However, in the case of Expeditors, Rose fervently means what he says.
Today anybody can buy anybody. Our not being for sale has nothing to do with price, but everything to do with pride, he said. Theres a
lot of what I call comfortability around here when I tell our employees that were not for sale.
They know I will never call their managers into a room and say, everything Ive told you for the last quarter-century is a lie meet your
new destiny, Because of that trust, we have a very high employee retention rate, Rose said.
That comfortability is not a shield behind which executives, including Rose, have carte blanche.
This company is not to be played with or toyed with. One of the reasons weve done so well is that we have remained pretty much scamproof, he explained. People try scamming us, of course. Thats one of the reasons that I abhor consultants.
CEOs who have gone to jail for corporate thieving, and others who should be jailed but havent been caught, always whine and say, I
could do what I wanted because my board of directors approved it.
If I did anything like that around here, theyd have my skin, Rose said.
Expeditors has a reputation as a very quiet company when it comes to marketing. Asked if it might be too quiet, Rose said, I dont think
so. People see us out there doing business, but they dont hear us talking about it. Yet word somehow gets around. We dont advertise because
we dont have to.
Expeditors rates are not the lowest around, which doesnt seem to impede the companys growth.
Our rates are actually extremely competitive, Rose asserted. I think its well enough known that if you order lobster at market price, you
re not going to get that lobster for the price of chicken.
When Expeditors started in 1982, we were an inbound air freight forwarder dealing with goods from the Far East. By 1984, we were doing
NVOCC (non-vessel-operating common carrier) work, ocean forwarding inbound and outbound, air freight inbound and outbound, and then
we expanded to warehousing, distribution and marine insurance, he said.
We still have our NVOCC function, under the name Expeditors. We have our Expeditors Cargo Management service. Most of these
functions are wrapped around optimum supporting technology, he explained.
Expeditors ocean volumes have been strong for all of 2005, as evidenced by monthly container count increases of about 20 percent yearover-year.
On the other hand, air freight tonnage is not looking particularly robust.
There definitely was freight that has traditionally been air freight moving by ocean between March and May 2005. Im not ready to say that
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this reflects a permanent shift to ocean freight, Rose said. There was some diversion from ocean to air freight during the last part of June.
The diversion of cargo from ocean to air will make whatever dent is going to be made in the air freight markets only. The amount of cargo
that can move by air, relative to that moving by ocean, is not enough to be noticed in the ocean market. The amount of air freight capacity that
would be required to make any sort of splash in the ocean markets literally does not exist, he explained.
The ratio for Expeditors inbound vis--vis outbound shipments used to be three to two, then it was four to two, now its like five to one.
Our mix in 2005 is about 70-30, 70 percent inbound, 30 outbound overall, he said.
The percentage of Expeditiors net revenue by import and export volume flows has shifted in some geographical divisions
Rose explained that the drastic shift in the Middle East and Indian Subcontinent is a reflection of substantial growth of imports into
markets such as India, Turkey and Egypt.
The shift in the Far East is due to increases in inter-Asia traffic, and the growth of imports into the markets of Japan, Korea and the People
s Republic of China, he said.
Expeditors ocean carrier strategy involves making annual volume commitments with multiple carriers for some portion of its anticipated
container volumes. Factors influencing these commitments include pricing, service levels, availability and predicted volumes based upon recent
experience. What is not moved under contract, moves on an ad hoc basis, Rose explained.
These negotiations are typically conducted annually, and then refined on an ongoing basis to meet changing customer and carrier needs.
The negotiations themselves focus around volume commitments and pricing levels, he said. In some respects, pricing is just pricing, as the
actual amount paid can be expected to move according to conditions set forth by contract and with the amounts otherwise available on the spot
market.
The interesting part of formulating our annual ocean strategy is establishing just how much of our total expected container volume we will
wrap up under contracts, and how much we will trust to the spot market, he said. The actual decision will vary from year to year. We have
contingency plans designed to react to situations that could arise if the most likely scenarios dont.
Rose said there is a vast middle ground between those customers who seek contract rates versus those who purchase on a spot basis.
Essentially, they are customers who have no contract, but who have an expectation that the rates they have been given will hold until further
notice, he said.
These are rates that dont move with the spot market exactly, but they arent very fixed either, he noted.
Even customers with contracted rates will face the potential for rate adjustments due to market circumstances.
Also, customers who purchase Expeditors services using a fresh rate quote expect that rate to remain firm until their shipment is delivered,
and so they are not truly purchasing at a spot price.
If you look at the entire range of customers to whom we provide services, we have just a few contracts, and none are the binding sort of
mutual commitment, Rose said. All of Expeditors contracts allow for termination over a relatively short period of time, or allow for
marketing pricing adjustment, or both.
Because of the dynamic nature of the logistics business, the contracts we do have contain provisions that are sufficiently flexible to allow for
routine business situations, such as pricing changes, to occur in a manner that doesnt get in the way of moving the freight, he explained.
No company can lose money on every shipment and make it up with volume. Why some of the other guys keep trying to do that is beyond
me, Rose added.
Ocean carriers have been successful in increasing their rates for the past couple of years. We dont expect that to change. For the
remainder of 2005 and into 2006, rate increases will be driven by two dominant variables: fuel and capacity.
Fuel is anyones guess. While there are rumors and expectations of capacity increases, you also have to consider port infrastructure issues
that will provide constraints, although not to the degree anticipated this year, he said.
Asked why last years peak season meltdown didnt occur this summer as many analysts had predicted, Rose said, every year recently has
been an anomaly.
This year, there wasnt an anomaly to screw up business. In 2001, we had 9/11. Then there was the ILWU (International Longshore and
Warehouse Union) strike, followed by the SARS epidemic.
Last year, there was a general sense of apprehension that something would happen, which did occur in the Asian tragedy of the tsunami at
the end of the year. In 2005, aside from hurricanes, not much has occurred to cast a shadow over trade, he said.
The ports of Los Angeles and Long Beach were able, in Roses view, to handle the predicted 14 percent increase in Asian imports because
they learned some lessons from the congestion last year.
Rose said shippers and carriers decisions to move cargoes through alternative ports to Los Angeles and Long Beach, unfortunately, had
More to do with selling against and capitalizing on Los Angeles and Long Beachs current challenges and less to do with the alternative ports
innate advantages.
Most of the freight that could capitalize on these innate advantages has already been transiting through those ports for a long time, he said.
The logistics mess created by hurricanes in the U.S. Gulf has caused some shifts in Expeditors shipments, Rose noted, but wont have a longterm impact.
Asked if the current levels of selective capacity deployment by ocean carriers is sustainable, Rose said that, as a matter of theory, there is
most certainly some level at which new capacity coming on line, when added to existing capacity redeployed to secondary and tertiary carriers,
will result in a glut of capacity that will reduce overall market pricing.
If that is correct, then what weve been seeing in the ocean markets in the last couple of years is theoretically unsustainable. The great
unknown is the proverbial containership that will break the camels back, he said.
Once we reach that tipping point, the pricing power that the carriers presently possess will begin to slip away, he explained.
Expeditors has definitely encountered customer resistance to passing on fuel costs.
Sadly, theres no end in sight. Analyses are talking about fuel prices going well over $4 a gallon, perhaps as much as $5, Rose said. That
will change buying habits among U.S. consumers, if it doesnt cause a revolution.
Still, compared to Europe, where they pay $6 or $7, I guess its all relative, he added.
Some of Expeditors customers understand why certain costs are passed on to them.
When we recently mentioned to Wal-Mart our currency adjustment factor on goods from Asia lets say it was 2.5 percent at the time
they said, yeah, we understand. We realize youre going to pass it on to us, and we accept it. They know thats the cost of doing their business,
Rose said.
Asked to explain how fuel surcharges affect rates for air freight, Rose cited the following example: Assume, based on our volumes and
freight mix on the route, that Expeditors buy rate for a shipment from Lower Slobovia to Upper Crustacia is 80 centers per kilo and the rate
offered to our customers $1 per kilo. We would have a net revenue margin of 20 cents and an air freight yield of 20 percent per kilo.
Now, lets say that the price of fuel goes up and airlines impose a 10 percent fuel surcharge. Our costs go from 80 cents per kilo to 88 cents
per kilo. Now if we do nothing, our net revenue margin becomes 12 cents and our yield becomes 12 percent clearly an undesirable result.
In order to maintain our margin, we immediately turn to our customers and begin the time-honored ritual of negotiating to pass on a fuel
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surcharge. This is a very complex ritual that the uninitiated can easily fail to fully appreciate. I cant reveal too much. But it can be said that
after some period of time, the rate charged to our continuing customers will move from $1 per kilo to $1.08 per kilo. Internally, we have
maintained our per fuel surcharge margin of 20 cents per kilo, but the yield is now only 18.5 percent.
Asked if non-asset-based Expeditors was seeing more competition from other supply chain solutions companies that own assets, Rose said,
The sort of competition were currently seeing has always been there.
Is it more intense in 2005? My answer is no. Were being regaled with just another flavor of the dancing circus bear. The outfits may
change, the routine gets upgraded and the music may be different, but at the end of the day, a dancing asset bear is still a bear in a tutu, he said.
They may try to present an image of refinement costumed in a supply chain outfit with a flashy IT wig, but youre still just watching a bear
dance.
Rose also noted that two major European air forwarders have publicly moaned about competitive pricing by unnamed other forwarders in
the international air freight market.
Thats like a couple of great white sharks complaining that other sharks are involved in a feeding frenzy. What they are really
communicating is that they didnt get enough to eat, he said. We know that great white sharks cant talk, but we doubt they ever voluntarily
turn away from a chance to eat. It is possible to imagine that the water might eventually get too shallow for these behemoths, or that an old
shark may just swim too slow to catch much.
Certain topics vex Rose in 2005 as much as in the past. One is corporate governance, which in his view has created a baleful environment
for projecting company performance.
In our pro-forma disclosures, we have used the historical volatility of Expeditors as the best proxy for future volatility, he said.
However now that Generally Accepted Accounting Principles (GAAP) is taking us all off the deep end, we will need to abandon our
historical touchstone and embrace the unknown and unknowable. This is GAAP in the brave new Sarbanes-Oxley world.
We have read experts who devote a great deal of ink to teeth gnashing over potential legal liability for a corporation to accurately estimate
future volatility. Its much like the three bears: if your estimate is too high, you overstate the expense and understate earnings and depress the
stock.
However, if you estimate too low, you will have understated expense and artificially inflated your stock. The only solution is to use the
volatility that is just right. Only Goldilocks and securities litigator using the clarity of hindsight will know for sure, he scoffed.
One of the reasons Im so anti-Sarbanes-Oxley, which was born out of the greed and avarice of so many companies, is because I dont take
500,000 or a million shares a year for myself, give another 500,000 to two other top people, and see that everyone else gets two shares, he said.
From the beginning of Expeditors, we decided to give our employees 20 percent of the pre-tax bottom line, rose said. The whole premise
of our company and the biggest advantage of being publicly held was to give a young person who worked at Expeditors a $250 share option
or a $500 share option, he explained.
After five years, a number of our young people were earning in six figures, he recalled. Most of them are with us in 2005.
We recently had two of our younger executives come in and meet our board. One of them was asked, how long have you been with
Expeditors? 20 years, he replied. The other executive noted he was 36, and had been with the company for 18 years, Rose explained.
Asked what still fires him up after a quarter-century, Rose said, My kicks come from having some influence on the careers of those younger
executives, and others like them.
Admittedly, theres an old-school side to Roses tough love of his employees. This has died down a little. But it used to be, in any staff
meeting I went to in any office, Id be asked, when are we going to have a casual day? I said, youve got two a week, knock yourself out,
Rose meant, of course, Saturdays and Sundays.
Rose is 62. Asked if he would still be at Expeditors a decade from now, he replied, I dont want to be asked to leave, or carried out. I hope
I would know when to go.
The succession is going to be internal, he added. We wont be looking outside the company with all of the talent we have inside.
Rose admitted that right now, I cant leave. Theres nothing else I know, I dont play golf. Ive done plenty of travel. They say if you dont
do something within five years of retirement, youll probably die, he added. If you love what you do, the rewards from that have nothing to
do with money.
The recent spate of high-profile mergers in the transportation industry is actually good for Expeditors, Rose said.
Theres always some consternation after a major merger. Obviously, to make acquisitions work, there are going to be economies of scale,
and I would think thats making some people nervous vendors, employees and customers, he explained.
That situation definitely creates opportunities for us to gain new business and hire worthy employees who leave one or both of the merged
entities, he said.
When mergers dont really work out, its usually because of an egomaniacal chief executive officer whos idle hand does the devils work, he
added.
I dont want to be a rumor-monger, but I understand that Deutsche Post is going to buy General Motors, General Electric and Motorola
and Wal-Mart, Rose said with a grin.
Rose was born in Montreal, where his father, James, was master of transportation for the Canadian National Express, with responsibility for
all trucks and drivers that met trains arriving in Montreal.
Rose left high school and took a job as an office boy at Canadian Pacific. He went to night school for four years at Sir George Williams
University, now renamed Concordia, taking high school and college courses. Its been self-education ever since, Rose said.
In 1964, CP transferred Rose to Chicago, where he worked in foreign freight accounting. After a sting with Compass Agencies, an agency
for Great Lakes ship lines, he went to work for Harper Robinson. By 1978, Rose was that Companys vice president for imports. The next
year, he co-founded Expeditors International and never looked back.
In 2005, leonine and charismatic as ever, Rose actually appeared mellow for him. The one constant in this business that I have seen over
the years is that nothing stays the same for very long, he explained.
In logistics, as in surfing, the only control is the control you make for yourself by picking the wave and keeping yourself in the right place.
Also, as in surfing, its pure folly to think you can control direction or magnitude. Your only hope remains to keep yourself in the right
position on the wave, and use your skills to stay upright as greater forces push you on.
Inimitably himself, Rose couldnt resist adding. That doesnt change your direction eventually, youre going to end up near the beach.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1909
Asset Focus:
Market Area:
Founding Business:
International
Truck Transportation
Cognard (Roanne)
GSI Air Fatton
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
M. Fatton
CEO
Pierre Fatton
Sylvain Fatton
Chairman
Operations
M. Donati
Guillaume Fatton
Sales
Ticker Symbol
125
48 **
490
1-3
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
250
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
300
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.54
10
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Fatton web
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
IDP
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Altadis
Tobacco
Bayer
Chemicals
Boisset
Beverages
Fermob
Furniture
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Fatton Transport
Europe
North America
Latin/South America
China
Austria
Canada
Argentina
Hong Kong
Denmark
United States
Taiwan
Finland
Thailand
France
Germany
Great Britain
Greece
Italy
Netherlands
Norway
Spain
Sweden
EDITOR'S COMMENTS
Fatton provides European transportation, some warehousing/logistics and international freight forwarding. The
U.S. contact is Frederic Marcerou, District Manager at 630-595-2477 or www.fattonusa.com.
Provider's Strengths
French-based Euro road network, U.S. offices - Chicago and New York. French competition is not strong.
Provider's Weaknesses
Scope is limited.
18th Edition
901-395-7608
COMPANY BACKGROUND
Parent Corporation:
FedEx Corporation
Asset Focus:
Market Area:
Founding Business:
Global
Motor Transportation
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Craig Simon
Fred Schardt
Virginia C. Albanese
VP Finance
SVP IT
1,970
999 **
6,100
99
3-5
Exchange:
NYSE
ASSETS
Total Transportation Assets:
Total Tractors:
298
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
20
1,094
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Healthcare
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies, Optum--SCE Transportation
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Infor/CAPS
Infor/EXCEED 4000
i2 Technologies
i2 Technologies Venture
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
ISO Certified Certification Locations: Memphis, TN; Twinsburg, OH; DCC Locations
Other Services:
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
3M
Miscellaneous
7-Eleven
Abbott Laboratories
Pharmaceuticals
Adidas
Apparel
Alcatel-Lucent
Alltrista
AstraZeneca
Pharmaceuticals
Asustek Computer
Ball-Foster Glass
Belk
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Spartanburg, SC
Europe
North America
Latin/South America
Bangladesh
Australia
Belgium
Canada
Egypt
Israel
China
New Zealand
Denmark
Mexico
Hong Kong
Finland
United States
India
France
Argentina
Bolivia
Brazil
Chile
Peru
Puerto Rico
Uruguay
Madagascar
Mauritius
Australia/New Zealand
FedEx
Dubai
Africa/Middle East
Asia/Pacific
Germany
Indonesia
Holland
Japan
Ireland
Malaysia
Italy
Nepal
Netherlands
Pakistan
Norway
Philippines
Portugal
Singapore
Spain
South Korea
Sweden
Sri Lanka
Switzerland
Taiwan
Turkey
Thailand
United Kingdom
Vietnam
EDITOR'S COMMENTS
Contract logistics, freight forwarding and customs brokerage at FedEx are service businesses whose role is to
support FedEx transportation. FedEx SCS has lost key business and is no longer a significant third-party contract
logistics competitor. For FedEx, SCM is a value-added part of express, package, less-than-truckload and other
operations.
Provider's Strengths
Good match for customers who will use other FedEx businesses extensively.
Provider's Weaknesses
Lack of neutrality in choosing carriers.
Memphis-based freight forwarder FedEx Trade Networks, a subsidiary of FedEx Corp. announced that it has opened additional offices in
Rotterdam, Netherlands, and Hamburg and Frankfurt, Germany, lifting its total of new such global offices to 28 since the inception of an
expansion plan launched in 2008.
Rotterdam and Hamburg are two of Europes largest seaports and Frankfurt serves as an important air cargo gateway to Central Europe,
said Fred Schardt, president and CEO of FedEx Trade Networks. With our new offices in these key markets, we continue to provide our
growing customer base with the service and operational support they need and the expertise they require.
Parcel redux: FedEx follows UPS with bullish forecast
Memphis-based package giant raises quarterly projections, citing continuing strong demand. Analysts warn of rate hikes ahead for shippers.
These are good times for the dynamic duopoly of the U.S. small-parcel industry.
Four days after UPS Inc. reported stellar second-quarter results, FedEx Corp., UPS's chief rival, announced on July 26 that per-share earnings
for its fiscal first quarter, which ends Aug. 31, would be well above what it originally forecast and would come in between 81 percent and 116
percent ahead of the year-earlier period.
The Memphis-based giant said it expects earnings to be $1.05 to $1.25 a share in the quarter; its earlier forecast was for earnings to reach 85
cents to $1.05 per share. For its full fiscal year, FedEx expects earnings per share of $4.60 to $5.20, up from a range of $4.40 to $5.00. FedEx
reported earnings of $3.76 per share in its previous fiscal year.
"Our revenue and earnings growth are exceeding original expectations, primarily due to better-than-expected growth" in the company's air
express and ground parcel volumes, said Alan B. Graf Jr., FedEx's executive vice president and chief financial officer, in a statement.
Graf said the company is benefiting from demand for its international express and freight services. For example, FedEx's International
Priority service, a time-sensitive premium-priced product, grew 20 percent in the quarter, Graf said. FedEx will issue its official first-quarter
results on Sept. 16.
The FedEx announcement comes on the heels of UPS's report that its per-share earnings in the second quarter rose 71 percent over prioryear numbers. Second-quarter revenue for the Atlanta-based company rose 13 percent year over year to $12.2 billion, resulting in a 57-percent
increase in operating profit to $1.4 billion. Operating margins year over year rose by well over 30 percent, the company said.
Jon A. Langenfeld, transportation analyst for the Milwaukee investment firm Robert W. Baird & Co., said the performance of both
companies, along with positive comments from other transportation firms, supports the idea that freight demand will stay strong beyond the
upcoming 2010 peak shipping season.
In an unwelcome but expected development for shippers, carrier pricing has lagged behind the recovery, according to Langenfeld. This
implies that higher prices lie ahead for shippers as they negotiate contract renewals in the second half of 2010.
FedEx and UPS continue to enjoy favorable pricing as a result of DHL Express's January 2009 exit from the domestic U.S. market. While the
incumbents have long since absorbed DHL's daily U.S. package count of between 1 and 1.5 million, the absence of a third shipping optionand
the departure of the low-price leaderhas led to yield improvements for FedEx and UPS and has emboldened them to take tougher lines on
pricing, according to Jerry Hempstead, former vice president, national account sales, for DHL Express and its predecessor Airborne Express,
18th Edition
FedEx Trade Networks continues global expansion
FedEx Trade Networks has opened six new freight forwarding offices across its Europe, Middle East & Africa (EMEA) region and its Latin
America region as part of a global expansion plan.
In EMEA, the new operations are located in Brussels (Belgium); Manchester and London (UK); and Mumbai and Chennai (India).
The new EMEA offices are in key trading and distribution centers and strengthen the company's position in the region. Belgium, an access
point to major ports, is centrally located at the heart of what is considered the golden triangle that links Amsterdam, Paris and Frankfurt.
The UK is a leading trading power and financial centre and home to one of the busiest airports in the world.
India is one of world's fastest-growing economies and presents tremendous potential in terms of market growth, capacity, and expansion.
In Latin America, the company opened a location in Mexico City, Mexico.
By establishing operations in Mexico, FedEx Trade Networks can facilitate increased end-to-end control of shipments and offer customers
reliable services between Mexico and the rest of the world. The Latin American market overall generates substantial trade with North America
and increasing volumes with EMEA and Asia-Pacific.
These locations are the latest additions to the company's expansion in key markets throughout Asia, Europe, the Middle East, Africa, and
Latin America.
FedEx Trade Networks opened a string of freight forwarding facilities across these regions in August, November and December last year.
FedEx Expands Freight Forwarding Presence Globally
FedEx Trade Networks Opens Seven Locations in Asia and Latin America
FedEx Trade Networks, a subsidiary of FedEx Corp. (NYSE: FDX) and growing international ocean and air freight forwarder, today
announced its expanded global presence with new freight forwarding offices in Asia and Latin America.
In Asia, the facilities are located in Singapore, Taiwan, and in Qingdao, Beijing, Guangzhou and Shenzhen, China. These new offices support
the company's international air freight forwarding operations and provide comprehensive coverage in key Asia-Pacific trade lanes. In Latin
America, the company opened an air and ocean forwarding office in So Paulo, Brazil.
These openings support the company's continuing global freight forwarding expansion plans, which include opening additional facilities and
establishing alliances throughout Asia, Europe, the Middle East, Africa and Latin America.
"Global trade trends continue to point toward a demand for both air and ocean freight forwarding services," said G. Edmond Clark,
president and CEO, FedEx Trade Networks. "Expanding the footprint of FedEx Trade Networks in critical growth markets will enable us to
deliver a full-service transportation solution and better serve the global supply chain needs of our customers."
The expansion will result in numerous benefits for customers, including:
Enhanced global freight forwarding services and end-to-end multimodal solutions;
Direct access to local personnel with industry experience and local expertise to meet customer needs;
Expanded regional access to services, including international direct distribution, and supply chain visibility, online FedEx trade tools such as
WorldTariff, and trade and customs advisory services; and
Increased access to the FedEx global network and seamless support across other FedEx operating companies in markets.
"By enhancing our global forwarding capabilities and increasing our local market presence, we are providing an integrated and comprehensive
solution for all our customers seeking to expand their business globally," said Fred Schardt, executive vice president and COO, FedEx Trade
Networks. "Whether customers choose FedEx Trade Networks services as a complete package, or take advantage of individual services, we can
deliver."
In 2008, FedEx Trade Networks opened flagship Asia air freight forwarding operations in Hong Kong and Shanghai.
Customer Success Story: Siemens Government Services, Inc.
Siemens Government Services, Inc. (SGS) plays a critical role in keeping Americas airports safe and secure. When SGS was awarded a vital
Homeland Security service logistics contract, they needed a logistics provider with intensive strategies and capabilities. SGS teamed up with
FedEx Global Supply Chain Services to deliver a logistics solution. FedEx Critical Inventory Logistics provides optimized sourcing across
multiple original equipment manufacturers (OEMs), minimizing average downtime through forward deployment of inventory, providing detailed
order visibility from placement to delivery, and ensuring returns are processed efficiently.
Innovative Solutions
After Sept. 11, 2001, the Transportation Security Administration wanted to put in place maintenance and program management plans for
their airport security equipment. They were looking for a single entity to take care of all equipment maintenance. SGS won the contract and has
continued to search for ways to further ensure customer satisfaction throughout over 450 U.S. and territory airports supported.
"We looked to FedEx for solutions because they are industry leaders and global providers with an excellent reputation for providing
innovative distribution solutions for other divisions within Siemens," said Wayne Weatherly, vice president of strategic accounts for Siemens
Government Services, Inc. "Through it all, the priority that FedEx put on addressing our distinct business requirements was fantastic."
Rapid Response
SGS and FedEx mapped out a plan that would give field service technicians quicker access to region-specific inventory distribution points.
What this means is that the field service technician does not have to go to a remote cabinet somewhere, or call in and order a part from the
OEM and risk missing the terms of the service level agreement. Now, they go to that region's forward stocking location or ramp, pick up the
part, complete the repair, and fulfill the ultimate goal of keeping air travelers safe and happy.
Technology-Driven Efficiency
18th Edition
The technology provided by FedEx Critical Inventory Logistics offers SGS the ability to optimize sourcing locations and transportation
services, check inventory balances, and automate inventory replenishment. Through system validation of parts prior to stocking, it also supplies
an additional layer of quality controls to ensure that Siemens is getting the right part.
Reclaimed Returns
After improving delivery time and maximizing field service technician efficiency, SGS needed to address lost and unaccounted for damaged
parts. Previously, the technicians would complete the repair and return the inoperative part to the OEM in order for reimbursement.
Unfortunately, the inoperative part returns were not getting back to the OEMs, resulting in thousands of dollars lost. FedEx stepped in with the
Advanced Asset Exchange service. Now the new part is sent to the field service technician with a complete return label that allows the
inoperable part to be placed into a replacement part box and immediately shipped back to the OEM for credit. If the part is not returned
according to the predefined process, FedEx provides various levels of proactive alerts to single out potential return issues, and offers services to
help reclaim the lost part.
Competitive Advantage
"There is no doubt that FedEx has enhanced our competitive position," Weatherly said. "The amount of time previously consumed by the
maintenance and parts sourcing process was approximately 60 to 70 percent of the overall time between the initial repair call and the fix. Now it
is half that amount of time. What that means to the traveling public is that they will have airport security equipment that is operational so they
can get through airport security checkpoints as quickly and efficiently as possible. That is how we define success."
SGS Opportunities
Minimize average downtime of security equipment.
Increase SGS field service technician productive repair time.
Gain access to dynamic inventory storage locations for domestic and international regions served.
Reduce OEM charge-backs for parts not returned.
Gain visibility to static, in-transit and returns inventory.
FedEx Solutions
Combination of central stocking location and forward stocking locations network.
Order optimization for parts sourcing from FedEx and OEM locations.
Complete visibility of orders, shipments and returns via fedex.com.
Advanced Asset Exchange.
Same-day moves.
Will-call pickup service.
Hold at FedEx Location service.
International shipping and document preparation.
Values
More than 30 percent reduction in call-to-fix time.
Decrease in OEM charge-back costs for missing parts.
Integrated business processes and technology.
Increased asset tracking and logistics capabilities.
Improved responsiveness by pre-positioning spare parts near regional airports.
Improved customer satisfaction by leveraging distribution network to cover all U.S. and territory airports.
Customer Success Story: Halifax
Halifax provides hardware maintenance and enterprise logistics services support to customers across the U.S., serving more than 30,000
locations and more than 400,000 pieces of equipment.
An essential part of the relationship between Halifax and their customers is how Halifax delivers on all aspects of the Service Level
Agreement (SLA). This business model requires visibility to static and in-transit inventory, a solution that empowers field service technicians and
call center representatives to make quick sourcing decisions, and scalable facilities to support the ongoing growth of the business.
Delivering Value. Real Time.
When a game-changing customer with narrow SLAs and national requirements was landed, Halifax took the opportunity to redesign their
distribution model in order to exceed the customer's expectations. After carefully evaluating all the available alternatives in the service parts
logistics market, Halifax chose to implement the FedEx Critical Inventory Logistics service.
"FedEx offered every service from air, ground, and freight, to international solutions and logistics services. This comprehensive approach
was the absolute driver for our decision to choose FedEx," said Craig Heck, vice president of Logistics and Support Services for Halifax.
FedEx Critical Inventory Logistics service is a solution specifically designed to support businesses that deal with inventory of a critical nature.
It offers proactive monitoring, event notifications and transportation service through a global infrastructure. Moreover, it benefits from a
strategically positioned central stocking location in Memphis, Tenn., with late order cut-off times and a network of FedEx Office and FedEx
Express forward stocking locations that provide Halifax prime access to the critical parts needed by field service technicians in the markets
Halifax serves.
When a repair call comes in, the Halifax Call Management Team has the ability to control service events through the fedex.com FedEx
Critical Inventory Logistics customer portal. The FedEx application provides the best sourcing location, mode of transportation and cost
calculations.
18th Edition
This process allows the call center representatives the ability to make the right decisions for the customers and for the business. FedEx serves
as the backbone to the Halifax delivery model.
Advancing Returns
Halifax also uses FedEx to help with shipping return parts back to their repair depot in Lewisberry, Pa. FedEx makes it easy for Halifax to
track the progress of parts moving to the repair depot. By ensuring defective parts reach the depot quickly, FedEx has helped Halifax improve
asset utilization as parts are quickly repaired and redeployed into inventory.
Delivering More Than Packages
"The FedEx Critical Inventory Logistics solution has allowed us to decrease field service technician trunk stock by 80 percent and reduce our
overall inventory carrying costs because a particular forward stocking location can feed multiple customer locations through one central point,"
said Heck. "We have increased uptime since the inception of the FedEx Critical Inventory Logistics solution. That is proof of how reliable
FedEx is."
FedEx Office has made work easier for Halifax field service technicians with the Hold at FedEx Location service. A part can be sent to a
FedEx Office location, and a technician is notified to pick up the part when it arrives. Heck said, "Field service technicians can use FedEx Office
not only as an inventory location, but also as a communication center to get on a PC, produce documents and ship returns. Some technicians
view it like stopping into their own office because it has everything they need."
Leveraging FedEx Experience
"A key differentiator of FedEx is their willingness to provide whatever resources are needed to drive continuous improvement. The FedEx
solution has given us a competitive edge in Service Level Agreement attainment. We can meet or beat SLAs and can provide prospective
customers with proof of this through existing customer references," stated Heck.
Halifax Opportunities
Support Service Level Agreement requirements (ranging from one hour to next business day).
Optimize inventory levels.
Increase velocity of the delivery of critical repair parts.
Improve visibility of static and in-transit inventory.
Leverage a scalable network to accommodate rapid growth.
FedEx Solutions
Order, sourcing and transportation optimization.
Central stocking location with late order cut-off times.
Intelligent return solutions.
FedEx Office and FedEx Express forward stocking locations.
Value
Enabled coast-to-coast coverage that allows Halifax to meet customer Service Level Agreements.
Reduced trunk stock by 80 percent.
Provided return solution with SKU-based dispositions, in-transit tracking and reporting of returns.
Provided access to customer portal, visibility and service event management for field service technicians.
Leveraged the ability of FedEx Office locations for PC/Internet access, printing and Hold at FedEx Location service.
Reduced inventory value and obsolescence.
Allowed Halifax to offer global solutions to customers.
18th Edition
49 2571 999-105
COMPANY BACKGROUND
Parent Corporation:
Heinz Fiege
Asset Focus:
Fiege Merlin
Fiege Aser
Fiege Kalf
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Dr. Hugo Fiege
Heinz Fiege
Stephan Meyer
Manfred Schnor
Peter Hardebeck
2,085
Ticker Symbol
2,085 **
Exchange:
20,000
20
1-3
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
32.3
5
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Healthcare
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3M
Miscellaneous
Bobcat
Bridgestone
Daimler
Germany
Esprit
Apparel
Germany
Fujitsu
General Motors
Poland
Hankook Tire
Hungary
Hanro AG
Apparel
France
Herlitz AG
Falkensee, Berlin
J. W. Ostendorf
Chemicals
Hungary
LG Electronics
Hungary
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Poland
Asia/Pacific
Europe
China
Austria
Taiwan
Belgium
North America
Fiege
Latin/South America
Czech Republic
France
Germany
Great Britain
Hungary
Italy
Netherlands
Poland
Portugal
Russia
Slovakia
Spain
Switzerland
Ukraine
EDITOR'S COMMENTS
Fiege Logistics provides supply chain management services and designs the process to individual customers. It
is organized into four divisions:
FIEGE log - stationary logistics, warehouse management and affiliated IT systems
FIEGE net - includes distribution systems and affiliated IT systems
FIEGE ecm - combines e-commerce activities with logistics to successful online selling and offline delivery
FIEGE engineering - in charge of consulting, development and realization of supply chain solutions
Fiege and U.S. 3PL Kenco have cooperated for some international customers. Fiege is profitable and well run.
Fiege operates in 18 countries with 210 branches.
Provider's Strengths
VAWD third-party logistics.
Provider's Weaknesses
Geographical range (Northern Europe).
Comments of Dr. Hugo Fiege, contract logistics pioneer on the effects of the downturn, Cardinal errors in outsourcing, pointless pricing
discussions and the management of the crisis at home.
LOG: Dr. Fiege, is the downturn a risk or an opportunity?
Fiege: For contract logistics an opportunity. However, we have a situation like we have never had. Previous economic crisises were local.
This economic crisis is not local but global affecting everyone.
LOG: How does it look for Fiege?
Fiege: We have some business declines but for the year we estimate that they will be 2 to 3%. Contract logistics declines depend very much
on the industries you operate in. Fiege has the good fortune to be in industries that are affected little or not at all. Over 50% of our business is
in short-lived consumer goods. Until now this segment has almost never been affected.
In Fashion, we are used to 20% or more but will run from -5 to +5. We are a leading provider in tires. We supply tire dealers not automobile
manufacturers. Our business in newspaper logistics is stable. Our industry solutions for heating and air conditioning and the health sector still
show significant growth.
LOG: So what are the changes? How do you expect to compensate for the minuses with new business?
Fiege: The demand for logistics solutions increases in difficult times. If an industry is declining and takes losses, it looks for ways to cut fixed
costs. Logistics comes into play.
LOG: Is this potential exhausted in most companies?
Fiege: I think not. The potential for outsourced logistics is still high. In major studies we read that only half of the available business is
outsourced.
LOG: Of course many prospects want to see their existing staffs retained.
Fiege: Yes, that happens but not much. It is not simple to retrain production workers into logistics employees. It is usually not cost effective.
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LOG: What do you advise for prospective customers who want to test whether they should outsource logistics? Must they get a consultant?
Fiege: In many cases it is worthwhile to have a consultant. Making a decision to outsource can be very significant. Many companies do not
have enough resources on their own to make this difficult decision. A second tip do not outsource at any price.
LOG: Thats surprising coming from a logistics provider.
Fiege: I am happy about every new account but outsourcing must be an economic plus. It isnt worth doing if changes within the company
could be easily made to get the job done. However, if things are complex, mastering that complexity is a major reason for outsourcing the
second reason is to get synergies. If there are not synergies and there is only a one to one swap, the advantage is low.
LOG: It can certainly give cost savings.
Fiege: In the end cook everything only with water. There are some wage and tariff differences between service providers and industries.
However if a simplistic approach is used in all circumstances, motivation can be lost risking later performance wage reductions should not be the
sole motive for outsourcing. There must be strong potential for process and quality improvements to realize the synergies. These are Cardinal
Rules for outsourcing because there is plenty of potential for error.
LOG: What other mistakes can be made in outsourcing and how should they be avoided?
Fiege: Over the many years of our experience, we have learned many things. It is important that the outsourcer enters discussions with an
unbiased and open attitude. The outsourcer must provide good company information so that the service provider can price his services
correctly. It can be disastrous if the partners lie to each other.
LOG: Are there other Cardinal sins?
Fiege: Yes. There is often too much pressure in the implementation phase. Often the company takes more than a year to decide to outsource
and then wants to implement in a very short time. Because of this pressure, we go into great detail with our customers about the timeline. The
third point is the training of employees. Here you can not be careful enough. I am an enthusiastic hunter and the hunter says Old hunter
young dog: Young hunter old dog. The point of this logic is When we undertake a startup, we move in people who enjoy their work and
do it well. The new people learn with experience and enthusiasm to do training. New people to redesign old tasks and work honestly with
existing employees to create a new team.
LOG: Respect for the timing, calculation and planning, an honoring the process - does that lead to success?
Fiege: I have a colleague who says that the logistics consists of the following elements: space, software, the team and task structure. If one of
these elements changes, it should not be a problem. We adjust to correct fairly noiselessly. If two elements need modification, one must be a
more accurate observer. If three elements need to be modified, it can get highly complex. Sometimes all four need modification. In those cases
one does not want to be constrained by lack of implementation funding.
LOG: Which items will your customers discuss with you? Over the price naturally.
Fiege: We expect our customers to talk over cost rather than price over. One can minimize the cost when processes are optimized. You can
optimize the process holistically and lower overall cost. If you only talk about price you waste potential. The profit of a logistics service
provider averages 2 to 3%. If a price reduction of 5 percent is demanded, the service diminishes and quality drops. It is much better to
optimize the project holistically. We have had double digit savings for transport networks when we optimized holistically.
LOG: Do you have a concrete example?
Fiege: Certainly. If the hiring process is run correctly and supports the proper operational process, it will save enormous cost. Conversely, if
you get all the orders in the last five minutes before they need to be shipped, it will increase cost.
Error prevention can also become an issue when you try to operate outside the process. Most of our customers now source all over Europe,
and that is a challenge for running an optimized network.
Proper planning for the transportation network always for better capacity utilization and cost structures from carriers as a result. As part of
these we eliminate more transactions that are losers. We put together a new supply chain system run from the center. We eliminate silos and
run international and German business together getting better utilization and lower cost.
LOG: Last question. How does Fiege view 2009?
Fiege: This will be a mixed year. We may have declines that I have not anticipated. On the other hand we will win new business to balance it
out. We expect a satisfactory return for the year. 2010 will be a good year because our restructuring will be fully effective.
(This article was translated by Dick Armstrong.)
New Logistics Center in Portugal - Fiege co-operates with Whirlpool
Greven/Lisbon, October 7, 2008. The Fiege Group, Greven, signed a new logistics contract in Portugal with Whirlpool, Europes number
one brand for household appliances. The co-operation between Whirlpool Portugal and the Portuguese subsidiary, Fiege Iberia, has been in
place for two years and is limited to the complete spectrum of warehousing services at the customers current warehouse. The recently signed
contract goes far beyond the current scope, and covers storage, order picking and the national distribution, including inventory management of
18th Edition
the products, plus various value added services such as the delivery to the end customer, including installation as well as service and spare parts
management.
To handle this task with the customary high quality and know-how, the Fiege Group will be developing a new Logistics Center in Azambuja,
around 40 kilometers north of Lisbon, jointly with an investor for the customer. The center will comply with all of the customer's requirements.
The center will offer around 15,000 square meters in space, with the option of being extended by a further 5,000 square meters and offer space
for roughly 9,000 household appliances like freezers, ovens, microwaves, dishwashers, washing-machines and dryers. The inventory management
will be recorded by Fieges own Warehouse Management System, which is interfaced with Whirlpools in-house SAP-based finance and order
system.
We already had a competent partner for our warehouse activities in Fiege. For this reason the decision in favor of Fiege as our partner for
the extended co-operation regarding the full supply chain was an easy one to make, explains the customer. Upon completion of the
construction work next May, it is intended to consolidate all Fiege Iberia activities in Portugal under the roof of the new center.
Double-digit Growth Rates in Reverse Logistics
Greven, August 5, 2008. - The fact that reverse logistics are on the rise is impressively demonstrated by the booming business. A growing
trading volume not only increases sales figures of forward-looking logistics that span all stages from production to the end customer, but also
the logistical realm of reverse sequences, or reverse logistics, i.e. from the end customer back to the final destination at the end of a products' life
cycle (end-of-life strategy).
The Fiege Group recognized this trend at an early stage and acted accordingly: Four years ago, the logistics provider from Greven formed a
subsidiary with the defined goal of offering customers a reverse supply chain system for waste electronic and electrical equipment. Today, Fiege
relog GmbH is in charge of the entire portfolio of services of integrated supply chain solutions for reverse logistics. Since its formation, it has
evolved from a project-oriented company into a highly lucrative and successful enterprise.
The most recent project of Fiege relog is a partnership-based co-operation with a provider that trades in returned servers of a renowned
brand of IT hardware. Drawing on an independent partner network, Fiege relog today collects devices in 23 European countries either as parcels
or LCL from clearing centers in Great Britain, Sweden, Germany and Switzerland. The devices are then re-processed independently by the
owner. The supply chain process includes in addition to the collection from the commercial end customer, the interim consolidation of the
goods at the partner sites of Fiege relog and the delivery to the respective clearing center as well as the control and administration of the entire
reverse supply chain process.
Within reverse logistics, the supply chain tends to act as the mediator of additional services that formulate an added value for the customer.
"We deal with goods that nobody else wants and which should not exist per se, i.e. returns", explains Dr. Rembert Horstmann, company
spokesman of the Fiege Group. And even "what is no longer wanted" is a product for Fiege relog which allows customers to generate an added
benefit. Fiege relog verifies whether a product can still be used or sold. If not, its utilization or potential recycling is looked into. If there are no
further options for its re-use, Fiege relog chooses a course of demolition for the product that complies with statutory guidelines.
Fiege relog pursues these inspection stages at all times with the customer in mind. The company operates by referring to a world-wide
network of partnering companies for partial segments of its operations. As a project company Fiege relog ensures the optimization of the
process chain regardless of the location and in line with the customer's needs.
Within the management of remnant inventory systems as well as reverse logistics and waste disposal management, Fiege relog has been able
to build up a renowned clientele from a variety of industries. The company's portfolio was enlarged last year by two-way logistics. This implies
providing the retail trade with two-way containers and disposing of the same. Within the management of remnant inventory, Fiege relog
expanded its activities in 2007 by the utilization of commodities from averages or damaged during transport. "And waste disposal management is
evolving with solid growth rates at double-digit figures," comments Dr. Rembert Horstmann. The growth of Fiege relog within reverse logistics
continues undiminished and in 2008, projected onto the entire year, has already reached 23 percent.
Bridgestone and Fiege officially open European Logistics Center East in Bor, Czech Republic
New investment in European Supply Chain Structure will further improve service levels to Bridgestone customers.
On May 16th 2008 Bridgestone Europe and its logistics partner Fiege officially opened the new Bridgestone European Logistics Center
(ELC) East in Bor, Czech Republic.
Around 100 guests attended the opening ceremony including representatives from 15 local, regional and national media, neighboring
companies, several customers and suppliers, and various members of Bridgestone Europe and Fiege Group companies.
Both VIP speakers, Mr. Jens Fiege CEO Fiege and Yves Kerstens VP Supply Chain, Bridgestone Europe, expressed their satisfaction
with the relationship between the two long-term partners and the results achieved, specifically in the case of the Bor tire warehouse.
Mr. Kerstens stated in his speech: Personally I am very pleased to see the results that have been achieved in this context with the Fiege
Group. In 1978 Bridgestone was Fieges first contract logistics customer in Germany and today Fiege is our main service provider in Central
and East Europe, operating warehouses in Germany, Hungary, Czech Republic and also the first partner to perform cross border deliveries.
Over the last 3 years the Bridgestone group has made several investments in the Supply Chain Structure in Europe, transforming a countrybased structure into a European supply chain structure. The initiative, launched in 2005, is based on the creation of 3 European Logistics
Centers: one in Belgium (Zeebrugge), one in Spain (Madrid) and one in Czech Republic (Bor).
These 3 ELCs store the full Bridgestone product line-up and have 4 main logistics functions:
Import center for tires coming from overseas
Weekly Replenishment of the distribution centers in the region
Deliveries to end customers across country borders
Finally, to act as storage buffers between market demand and production supply
Phase 1 of the ELC-East in Bor some 20 km from the German-Czech Republic border - started operating in September 2006, after the
rapid construction of 54,000 m2 over a period of 7 months. The location Bor was selected for its strategic location to serve existing West
European markets as well as fast growing markets in East and Central Europe.
In May 2007 the company decided to extend the operation by another 16,000 m2 to cope with growing winter tire market demand.
The capacity of the warehouse totals up to 1,100,000 tires and around 100 employees are responsible for handling over 2,000 different
articles, comprising tires for passenger cars, trucks, buses, motorcycles, tractors and other agricultural machinery.
Fiege handles logistics for Hankook
18th Edition
The Fiege Group, Greven, managed to broaden the companys European tyre chart by Hungary. A new customer, the globally-operating
Korean tyre manufacturer Hankook, was acquired for the tyre logistics industry in which the Fiege Group has been active for almost 30 years.
As a result, the logistics provider from Westphalia in Germany now operates in Spain, in Switzerland, in Sweden, in the Czech Republic, in
Poland, in Hungary and in Germany for such renowned tire manufacturers like Bridgestone, Pirelli, Continental, Toyo, Yokohama and
Hankook.
Hankook, headquartered in Seoul, Korea, is among the seven largest tire manufacturers of the world. At the Fiege Logistics Center Budapest,
at Harbor Park, the first container filled with Hankook tires arrived in September 2007 already. Up to 500,000 tires will pass through the
warehouse this year. This figure covers around 400 different items stored on around 2,000 square meters. As soon as the containers dock at the
ramps, Fiege assumes control of the logistical flow, which includes quality inspections, storage, various value added services, release from stock
as well as the distribution of tires throughout the whole of Hungary within 24 hours. Customs clearance and international transports to the
Czech Republic, Slovakia, Rumanian, Lithuania, Estonia and Poland partially also form part of the services spectrum of Fiege Hungary.
The business of tires calls for a particular know-how which Fiege was able to translate to Hungary without difficulty on the grounds of its
existing tire logistics activities in other European countries, is how Thomas Schleife, management of Fiege Eastern Europe, details the benefits
of the pan-national tire logistics of the Fiege Group. Even if different languages are spoken and different mentalities exist, striving for success
of the highest quality and flexibility has united Fiege and Hankook in a successful partnership. We shall continue to further expand our activities
in tire logistics especially in Eastern Europe.
In addition to Hankook, the Fiege Group operates on around 30,000 square meters of warehouse and logistics space at the Budapest Harbor
Park for such other distinguished clients like Bridgestone, LG Electronics, Whirlpool and the paint manufacturer Ostendorf.
European Logistics Partnership between Fiege and Vorwerk
Long-standing co-operation to be stepped up
Greven/Wuppertal, November 27, 2007 A Lead Logistics Partnership (LLP) has been initiated by the Vorwerk group of companies based
in Wuppertal/Germany and the logistics provider Fiege, headquartered in Greven/Germany. The aim of this LLP project is for Vorwerk and
Fiege to jointly ascertain the strategy and standards for Vorwerk's German and European logistics, as well as the award of contracts.
Vorwerk Elektrowerke Stiftung & Co. KG, Wuppertal, had previously founded a co-operation with Fiege Holding in Wuppertal in 1996,
Prolog professional logistics GmbH & Co. KG. The joint venture's primary objective to-date is to handle Vorwerk's core logistics business. In
1997, ProLog Logistics was founded, a subsidiary which is headquartered in Wollerau/Switzerland. The company's main task is the organization
and constant improvement of international logistical flows.
The successful co-operation between Vorwerk and Fiege, now in its 11th year, has been extended to the year 2012, and as a result of the
strategic Lead Logistics Partnership has been substantially stepped up. CLOSe Logistics GmbH was founded in Wollerau/Switzerland and owns
subsidiaries in Italy and Germany. CLOSe is a neutral broker of supply chain and transport services for Vorwerk's three segments, vacuum
cleaners, kitchen appliances and pressing systems.
CLOSe's scope of responsibilities includes the following: warranty for the service rendered so far in terms of quality and price; cost reduction
through the application of a benchmark system that evaluates processes already in place; the convergence of volume purchases within the
Transport, Express, Warehousing and Order Picking departments; standardization of internal and external systems and flows; as well as the
expansion of the logistical range of offers to further areas of Vorwerk in the medium run. In line of such intensification of shared duties, the
Fiege Group assumes the current participation of Vorwerk in ProLog, which will continue to operate as the logistics provider for Vorwerk.
"This measure creates new opportunities for raising the quality and efficiency of our company", emphasizes Vorwerk. "The geographical
proximity of Prolog, our German logistics partner, to our main production location means that it is excellently positioned even for future
invitation of tenders."
Fiege operates new European Distribution Center for 3M
Contract for Poland, Czech Republic and Hungary signed following a tender process
Greven/Warsaw, November 27, 2007 The decision in favor of Fiege has been made: The successful co-operation in Poland between the
German logistics provider Fiege, headquartered in Greven/Germany and 3M, a leading globally-operating technology company, will be
extended. The new European Distribution Center (CEDC) in Dabrowa Grnicza, Silesia will be realized and run by the Fiege Group.
Operations will cover Poland as well as the Czech Republic and Hungary, and will include replenishment orders for other 3M warehouses in
Eastern Europe and are scheduled to start in January 2008.
"In doing so, we not only extended our scope of services for 3M, but upon expiration of the existing ten-year contract achieved the signing
of a new contract following the Europe-wide invitation of tenders, thereby successfully distinguishing ourselves from a field of strong
competitors", states Jens Fiege, CEO Fiege International, about the extraordinary aspects of the newly established co-operation.
The co-operation between Fiege and 3M, which has been in place since 1997 and whose product portfolio includes such renowned names
like Scotch, Post-it, Command and Vikuiti, started at the very first branch of Fiege Poland, in Odrzywolek near Grjec. Over the years, this cooperation evolved from the provision of genuine warehousing activities to include international transports and the domestic distribution to
today's highly diverse value added services which comprise, for example, labeling, repackaging and additional packaging.
In the year 2000 all logistical operations were relocated to Mszczonw, which is located on the outskirts of Warsaw. The Mega Center of the
Fiege Group based there has since been home to the headquarters of Fiege in Poland. The facility in Mszczonw has grown to become a
distribution centre for the entire Polish market. From here, Fiege handles all supply chain operations which 3M provides to the Polish market
for medical products, industrial goods and office supplies.
The new centre in Silesia, which is part of the 3M network of European Distribution Centers, will assume the function of a new distribution
centre for Central Europe in Southern Poland for direct deliveries to customers based in Poland, the Czech Republic and Hungary. It will
equally be home to handling replenishment orders for other 3M warehouses in Eastern Europe. The region of Silesia was chosen for the new
CEDC because of its central location. Moreover, it provides good connections to Poland's major cities as well as a relatively sound road
infrastructure to the central consumer markets in Poland, Hungary and the Czech Republic.
The facility in Dabrowa Grnicza was established in 2005 already. Fiege uses an area of 45,000 m in a modern building which fulfils all
functions of a bonded warehouse. The entire warehouse space reserved for 3M totals 15,000 m. For pharmaceutical and dental technology
products, a separate and licensed area has been set up, with the latest technique in electronic temperature and climate control, to comply with
regulatory requirements.
18th Edition
"We are very happy about the expansion of our co-operation with 3M, which is not only a significant success for our company but also a
major challenge for the future", explains Piotr Kohmann, CEO Fiege Sp. z o.o., "since this new contract for us is proof of the past efforts of
our company for 3M in Poland." And Paul Davis, European Distribution Network Manager for 3M adds: We were impressed by the Fiege
response to the tender for the new CEDC operation. It is 3Ms first experience of outsourcing an EDC and the previous good experience with
Fiege, together with the confidence that we would get immediate and high level attention to resolve any significant issues were both important
elements that contributed to their successful bid."
18th Edition
65 6267 5577
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1981
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
Singapore based 3PL with consolidation/deconsolidation emphasis and expanding chemical logistics capabilities.
KEY PERSONNEL
Eric Khua Kian Keong
CEO
CFO
SVP Corporate
87
44 **
Exchange:
711
SGX
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
474
Total Tankers:
150
1.4
Total Other:
MAJOR MARKETS
Elements
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Chemicals
PRC
BASF
Chemicals
PRC
Mitsubishi Chemical
Chemicals
PRC
Shell Chemicals
Petroleum Refining
PRC
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
China
Europe
North America
Freight Links
Latin/South America
Australia
Hong Kong
Malaysia
Singapore
Thailand
EDITOR'S COMMENTS
Freight Links Express is a major consolidator, deconsolidator and trans-shipment company. Its freight
forwarding is done primarily through agents. Freight forwarding is 48% of its total revenue, chemical logistics is
33%, warehousing is 15% and marketing, records management and relocation services is 4%.
Freight Links Express continues to strengthen its position in the chemical logistics arena. In 2004 it purchased
51% stake in LTH Logistics (Singapore) Pte Ltd. Since then, it has increased its chemicals logistics storage space
and revenue. Its chemical logistics revenue grew 19% last year.
Provider's Strengths
Operations and warehouses in key locations.
Provider's Weaknesses
Singapores leading provider of integrated logistics management services is eyeing more acquisition opportunities and strategic alliances in Asia.
Liz Rosagas reports.
Global trends including mass customization, shortening of product lifecycles, low inventory, quick response requirement and globalization of
supply chain are having an impact on the freight forwarding industry.
Growing its freight forwarding business is mainboard-listed Freight Links Express Holdings Limited, an integrated logistics service provider.
It is one of the largest international cargo handlers in Singapore. Freight Links has a global network more than 120 freight forwarding agents
covering nearly 600 destinations. Its overseas offices are in Malaysia, Thailand, Hong Kong, China, Australia and the United Arab Emirates.
Analysts have noted that international freight forwarding business is expected to provide a stable base load for the group.
Mr. Eric Khua Kian Keong, executive director and chief executive officer of Freight Links, said it is very difficult to estimate the companys
market share of the freight forwarding business. Even the three largest freight forwarders in the world makes up less than five percent of the
market, he explained.
Mr. Khua commented that Freight Links position has been strengthened when it took a strategic 20 percent stake in Freight Management
Holdings Berhad, which is a leading international logistics provider listed on the Malaysian Stock Exchange. The complementary network
afforded by our new working relationship with Freight Management gives us a much wider market coverage as well as greater negotiating power
with shipping lines, which enable us to deliver better rates to our clients. This will enhance our market share, he added.
The acquisition value of this shareholding before brokerage was RM15.1 million ($6.5 million) in November last year. Freight Links has
access to Freight Managements rail freight services between Port Klang in Malaysia and Lat Krabang, Bangkok, in Thailand. It represents an
opportunity for Freight Links to cross sell rail freight services to its existing and potential customers.
CAPTURING CHINAS LOGISTICS MARKET
A research report by Standard & Poors (S&P) noted that Freight Links earnings growth momentum would be driven by its new chemical
logistics business and the Chinese logistics market. Acknowledging that China is becoming an increasingly vital market, Mr. Khua has said
Freight Links would leverage on its existing logistics investments on the mainland and continue to explore acquisition opportunities to improve
its earnings and enhance returns to shareholders.
The Chinese logistics market is growing rapidly, particularly in the inland of the country. We have made strong inroads via our existing
investments in China Baisui Logistics, China GSD Logistics and Fudao Petrochemicals Group, said Mr. Khua.
However, competition is stiff as China is home to hundreds of thousands of local logistics companies and dozens of foreign players.
Last September, Freight Links invested $13.5 million in a part single/part three-story warehouse complex for storage of hazardous or
dangerous goods (DGs). Located at Penjuru Lane here, the new Freight Links DG warehouse covers almost 130,000 square feet. When
completed in the second quarter of this year, it will offer a high-density storage capacity of about 12,000 pallet positions, employing the VeryNarrow-Aisle storage technology.
This state-of-the-art warehouse will feature foam/water sprinklers, safety showers and gas detectors. In addition, Freight Links will also
custom-build an underground retention basin to contain spillage, and compartmentalized firewalls for different DG classifications. The
warehouse will be fully compliant with the international standards latest code of practice for storage of DGs.
With this complex, the company hopes to meet increasing demands of its customers in the areas of hazardous chemicals and DGs. As
Singapore is one of the worlds key petrochemical hubs, companies from the United States, Europe, Japan and other countries are making their
presence felt in Jurong Petrochemical Complex. With the new warehouse in close proximity, Freight Links targets to meet growing demand for
storage facilities and value-added services.
M&A AND ORGANIC GROWTH ARE THE WAY TO GO
In November 2004, Freight Links made a foray into the chemical storage and distribution business with the acquisition of a 51 percent stake
in LTH Logistics (Singapore) Pte Ltd.
LTH is a leading chemical logistics company with core capabilities in haulage and warehousing of hazardous and non-hazardous chemicals.
It also provides value-added services such as drumming, plant logistics and emergency response. LTH has received many awards from the
Singapore Chemical Industry Council for achievement in Community Awareness and Emergency Response, Distribution, and Employee Health
and Safety.
Mr. Khua said Freight Links is in the process of constructing 16,000 new pallet positions in its new chemical warehouse. This gives us a
lead on the market, particularly in the area of petrochemicals that the government has identified as a future area of growth for Singapore, he
18th Edition
added.
For the six months ended October 31, 2006, the group recorded a 17.3 percent increase in turnover to $61.9 million. The groups total profit
rose 13.6 percent o $2.3 million during the same period.
In efforts to further grow its businesses, Freight Links is focusing on both mergers & acquisitions and organic growth. We will target our
regional expansion in Asia, remarked Mr. Klua.
In July last year, Freight Links acquired an additional 600 ordinary shares of Baht1,000 each in Freight Links Express (Thailand) Co Ltd (FLE
Thailand), which is equivalent to 30 percent of its issued share capital for a total consideration of Baht8.775 million. With this purchase, the
companys equity interest in FLE Thailand rose from 19 percent to 49 percent.
Going forward, Freight Links has identified a few engines of growth. Firstly, we will bring our new warehouse online, said Mr. Klua,
adding that: Next we will continue to expand our business, particularly with the new opportunities that Freight Management has created in
three relevant areas freight forwarding operations and network, chemical logistics, and warehousing and distribution.
Investors should take heed that there are execution risks in new markets, acquisitions and joint ventures. Barring any economic slowdown
that would cause a dip in freight rates, storage rates and shipping volumes, Freight Links is gearing up for more organic growth, strategic
alliances and acquisitions this year.
18th Edition
33 (0)1 49 05 20 20
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Automotive Manufacturing
Automobiles Citron
PSA Wholesale Ltd.
GEFCO International Logistics (China) Co Ltd.
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Yves Fargues
Phil Shankley
Michel Saywell
Philippe Coss
Jean-Marc Prigent
4,014
1,806 **
Exchange:
9,400
Paris OTC
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
7.5
Total Other:
Total Trailers:
Total Aircraft:
36
Total Ocean:
1,900
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Anaka
Romania
BMW
Europe
Delphi
Turkey
Dia
Spain
Electrolux
Romania
Ford Motor
UK
Grimaldi
Shipping
Benelux
Honda Motor
Europe
Jaguar
Europe
Kosmepol
Europe
Manter
Osram
Chile
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
Morocco
China
Austria
Tunisia
Hong Kong
Benelux
North America
Czech Republic
GEFCO
Latin/South America
Argentina
Brazil
Chile
France
Germany
Hungary
Italy
Latvia
Poland
Portugal
Romania
Russia
Slovakia
Slovenia
Spain
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
GEFCO is a key partner for car manufacturers, rental firms and distributors of new and used vehicles. GEFCO
transported 2.5 million vehicles in 2009. Vehicle preparation and distribution is more than 50% of GEFCO's total
revenue. Its other main revenue components include consolidation and land transportation which is 36% and air
and sea logistics which is 14%.
Provider's Strengths
Preparation, reconditioning and distribution of vehicles.
Provider's Weaknesses
GEFCO doubles capacity at its Sete Lagoas site in Minas Gerais, Brazil, and signs a contract to distribute Renault vehicles in Morocco.
GEFCO Brazil is extending its Sete Lagoas site in Minas Gerais, doubling storage capacity from 465 vehicles to 993.
The expansion is in response to customer demand for capacity to meet their logistics needs.
GEFCO Morocco has a contract to distribute 15,000 Renault vehicles in the country this year. Consequently, the Automotive centre that
opened near Casablanca two years ago is making 3,600 additional storage spaces available for Renault.
Imported from Europe or produced locally, the vehicles are prepared and distributed by car-carrier by the Automotive workshop in
Casablanca to 23 Moroccan dealerships.
GEFCO Morocco now distributes around 55,000 cars in Morocco for the Renault, Dacia, Peugeot and Citron brands.
GEFCO maintains profitability level in 2009
Paris, 23 March 2010 With operating income of 102 million, representing 3.5% of turnover compared with 3.6% in 2008, the GEFCO
group has maintained its profitability level. Turnover in 2009 came to 2,888 million, down 18.3% on 2008 owing to the impact of the
slowdown in global automotive production in first-half 2009 and, more generally speaking, by an unfavorable industrial context.
Despite the crisis, the GEFCO group maintained its profitability level in 2009. This was the result of several, converging actions, namely
extremely rigorous management of purchasing and operating costs and a sustained effort from the sales forces in priority markets, together with
a recovery in Western European automotive markets in the fourth quarter thanks to state intervention, particularly in the form of scrappage
bonuses.
Contrasting markets
The strategic regions of Central and Eastern Europe and South America bore the full brunt of the crisis in 2009.
In Central and Eastern Europe, turnover totalled 278 million, down 19% on 2008.
In South America, GEFCO reported turnover of 149 million, down 16% year-on-year.
However, GEFCO scored excellent performances in the rest of the world, particularly in the Maghreb countries and China, reporting a 50%
increase in turnover compared with 2008 (15 million in 2009 up from 10 million in 2008).
Continued international development
Already solidly implanted in Western, Central and Eastern Europe, GEFCO continues to develop business in its strategic regions. In 2010
the Group will start up activity in two new countries, Kazakhstan and Bulgaria.
GEFCO sets up shop in South Africa; announces new automotive logistics deals
18th Edition
GEFCO sets up South African subsidiary; announces logistics deals in Italy, Benelux, Turkey and Poland, and renews partnership with
Electrolux.
GEFCO has established a subsidiary in Johannesburg, a region with high import and export volumes - notably for the automotive industry.
GEFCO is negotiating a global agreement to import spare parts for Peugeot and distribute them in South Africa and neighboring countries
including Swaziland, Namibia and Botswana.
The agreement represents up to one tonne of spare parts by air every day and between four and six sea containers every month.
GEFCO is also negotiating other partnerships in South Africa.
GEFCO Italy is now Yamaha's official service provider in Italy, and will ship 70,000 Yamaha two-wheelers throughout the country this year.
Partners since 2006, GEFCO Italy distributed 14,000 of the brand's two-wheelers in Tuscany and Sicily in 2008. The partnership has now
been extended countrywide to the twenty regions.
GEFCO Benelux has renewed its partnership with Grimaldi for another three years.
The contract covers the distribution in Belgium and the Netherlands of 60,000 Fiat, Alfa-Romeo and Lancia vehicles arriving by sea at the
port of Antwerp from Italy, Poland and Turkey. The vehicle centers at Ghislenghien, Belgium and Oosterhout, the Netherlands supply 250
dealerships in the two countries.
GEFCO Turkey is also distributing Peugeot Partner and Citron Berlingo vehicles from the Burasa plant.
The objective is to deliver 30,000 units, depending on demand in the emerging markets in Eastern Europe, the Middle East and northern
Africa. GEFCO Turkey currently manages logistics for 130,000 vehicles a year.
GEFCO Poland has extended its expertise to the production and assembly of van partitions for three car brands - Peugeot, Citron and
Indian manufacturer Tata Motors - at its Legionowo and Gdynia centers.
The company received approval for these operations from Poland's Ministry of Finance and homologation from the Automotive Industrial
Institute (PIMOT) and the Vehicle Transport Institute (ITS).
GEFCO Romania has extended its partnership with Electrolux.
For several months, GEFCO Romania has been distributing ovens manufactured at Satu Mare in northwest Romania to Moscow in Russia,
and will now distribute to other destinations in Eastern Europe, including Serbia, Croatia, Bosnia, Macedonia and Montenegro.
PSA unlikely to sell Gefco
The fate of Peugeot-Citrons logistics arm Gefco is now in the hands of former Corus CEO Phillipe Varin (pictured) following the company
s unprecedented decision to oust CEO Christian Strieff on Monday.
While no firm plans will be put in place until Varins official start date on the June 1, analysts have been speculating on the companys plans
to shed its unit assets including the Gefco logistics arm and parts subsidiary Faurecia. Disposal of those units would meet with investor
approval, Michael Tyndall of auto analyst Nomura Securities told Bloomberg.
But while Gefco would not comment on the future of its relationship to the carmaker, PSAs UK spokesman Stuart Anderson told
Automotive Logistics that the company was carrying on its relationship as normal and had no plans to sell off Gefco at the moment. He also
pointed to the benefits of maintaining the status quo with the company given the significant cost savings Gefco had brought PSA in recent years.
This was backed up by Transport Intelligence analyst Thomas Cullen, who pointed out that it was very unlikely the company would sell off
Gefco.
Gefco has subtly begun to re-orientate away from dependence on automotive, but it would be hard for it to end its relationship with PSA,
he said. For example, it has huge volumes of automotive moved by PSA which underpin its less-than-truckload road freight business.
They might float a portion of it on the Stock Exchange but that would take time, he added.
Shares in PSA dropped 9% to 13.94 ($18.45) in trading on Monday following the announcement.
GEFCO: international growth in 2008
Paris, 5 March 2009 GEFCOs sales and revenue in 2008 totaled 3.536 billion, down 0.5% on 2007.
The group reported a consolidated operating income of 127 million, equivalent to 3.6% of sales and revenue, compared with 4.4% in 2007.
The results remained positive despite two significant challenges in 2008:
The increase in the price of oil, and in turn diesel fuel, in the first seven months of the year, with the barrel nudging the $150 mark just
before the summer.
The fall in the automotive sector, GEFCO's number-one market, was down 30% in Europe (passenger car market in 27 countries) in the
fourth quarter.
2008 was a source of new progress:
International growth - Through simple organic growth, GEFCO strengthened its position in 2008 in two strategic zones: +32% in Central
and Eastern Europe (344 million in 2008 against 261 million in 2007) and +28% in Mercosur (178 million in 2008 against 139 million in
2007). In these two zones, GEFCO has grown stronger in its priority markets, including: automotive, two-wheelers, automotive supply, retail
and electronics.
Diversification of industrial activities - Logistics sales and revenue for the PSA group increased 1%, from 2.149 billion in 2007 to 2.171
billion in 2008, while non-group logistics sales and revenue rose 4.9%, from 1.211 billion in 2007 to 1.271 billion in 2008 (excluding Overland
Germany restructured end 2007).
Development of high valued-added solutions, both inbound and outbound - In 2008, GEFCO increased its capacity to bring manufacturers
gains in competitiveness in international supply chain management by ensuring complete end-to-end solutions. This progress is reflected in the
near 5% growth reported in Overseas and logistics activities.
GEFCO establishes new subsidiary in Chile
GEFCO is setting up a subsidiary in Chile in response to growing demand from manufacturers in Chile and other parts of South America,
particularly in the automotive, cosmetics and health sectors.
GEFCO's results in Brazil and Argentina in recent years reflect the strong growth potential of this region, which accounted for more than
18th Edition
Gefco UK, part of the international transport and logistics group, has been selected to manage just-in-time logistics for the production of
high-tech photovoltaic (PV) solar technology for Solarcentury, Europes leading solar energy company, specializing in the design and supply of
building integrated solar electric and thermal technology.
Solarcentury has already begun using Gefcos integrated logistics warehouse in Coventry as its main European storage centre, and will utilize
Gefcos customs management process, which was approved by HM Revenue and Customs in 2007.
Gefcos ability to handle rapid growth is critical for Solarcentury as the PV technology industry is expanding fast. Solarcenturys European
growth exceeded 25 percent last year.
Under the new supply chain process, Gefco will provide raw materials storage and transportation to a Solarcentury facility in Wales where the
latest solar technology, the Solarcentury C21 solar electric roof tile, are assembled, branded and boxed. The finished products are returned to
Coventry before being delivered on a just-in-time basis, duty-paid to Solarcenturys European distribution hub in Chessington, to be distributed
throughout the UK and Europe.
18th Edition
33-1-56-76-26-26
COMPANY BACKGROUND
Parent Corporation:
SNCF
Asset Focus:
Market Area:
Founding Business:
International
Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jean-Louis Demeulenaere
CEO
Jean-Paul Vignal
Philippe Gilbert
Laurent Dumas
Gilles Lvque
CFO
CIO
4,209
Ticker Symbol
1,263 **
Exchange:
12,200
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
17,000
Total Other:
Total Reefers:
Total Flatbeds:
33
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary, Oracle--OTM
Proprietary, Infolog, SAP
Barloworld
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Alstom
Industrial Machinery
Arkema
Chemicals
AstraZeneca
Pharmaceuticals
Atlas Copco
Manufacturing
Auchan
Hungary
Bayer
Chemicals
Europe
BMW
BP
Petroleum Refining
Carrefour Logidis
Castorama
Specialty Retailers
Disney
Entertainment
Dnata
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Cameroon
Chad
China
French Polynesia
Belgium
Mexico
Hong Kong
New Zealand
Czech Republic
United States
Argentina
Brazil
Chile
Colombia
French Guiana
Guadeloupe
Martinique
Peru
Venezuela
Cte d'Ivoire
Australia/New Zealand
Geodis
Burkina Faso
Africa/Middle East
Asia/Pacific
Denmark
India
Israel
Finland
Indonesia
Kuwait
France
Mali
Morocco
Japan
Qatar
Philippines
Reunion Island
Singapore
Saudi Arabia
Senegal
South Korea
Germany
Malaysia
Greece
Hungary
Ireland
Italy
Taiwan
Luxembourg
Tunisia
Thailand
Netherlands
Vietnam
Norway
South Africa
Poland
Romania
Russia
Slovakia
Spain
Sweden
Switzerland
Turkey
United Kingdom
EDITOR'S COMMENTS
Geodis is France's largest provider of transportation and logistics services and is one of the top European 3PLs.
With third-party logistics revenues of $4.2 billion and more than 12,000 employees, Geodis Group covers more
than 120 countries worldwide through its subsidiaries including Geodis Logistics, Geodis Wilson, and Geodis
Supply Chain Optimization (which grew out of its December 2008 acquisition of IBMs internal global logistics
operations). Most of the Groups revenue is European based and accounts for 78% of total revenue, Asia-Pacific is
11%, the Americas is 9% and the Middle East and Africa account for the rest.
Geodis Groups service portfolio is has significant coverage in Europe where it has five core businesses:
groupage (parcel delivery/LTL express), truckload, contract logistics, freight forwarding and supply chain
optimization. Freight forwarding is its largest segment generating 31% of revenue, groupage is next at 29%, then
contract logistics 16%, truckload 13% and supply chain optimization 12%. In Europe, Geodis industry segment 3PL
revenue breakdown is FMCG/Retail 42%, Automotive 17%, High-tech 16%, Industrial 11%, Healthcare 4%,
Textiles 3% and Others 7%.
Geodis purchased TNTs freight forwarder (Wilson) in late 2006. Wilson added significant new coverage for
Germany, China, Australia, New Zealand, North America and South America. Geodis has limited penetration in the
North American market. There are 18 offices including two for its chemicals specialist operation, Rohde &
Liesenfeld. It relies on a strategic alliance with International Papers xpedx.
Provider's Strengths
Broad offering.
Provider's Weaknesses
Needs a global identity and strong leadership to profitability.
Geodis Wilson has expanded its Atlanta operations into a new, larger facility designed to meet new and increasingly demanding regulatory
requirements, as well as growth in demand for supply chain solutions.
The new 84,000 sq. ft. facility provides airfreight, ocean freight, customs brokerage, domestic forwarding, warehousing and distribution and
other freight management solutions.
Geodis Wilson Atlanta is also a primary US airfreight gateway, serving the entire region including Georgia, South Carolina, North Carolina,
Tennessee, Alabama, and parts of Florida and Virginia, and has regularly scheduled consolidations to most major markets in Europe.
Geodis Wilson has also invested in the necessary infrastructure in Atlanta to become one of several new Certified Cargo Screening Facilities
(CCSFs) in the US, enabling the company to provide shippers with a fast, efficient, secure, and predictable cost option for screening freight in
compliance with the Transportation Security Administration's new 100% cargo screening mandate for all passenger aircraft.
Geodis enjoys strong growth
French-based logistics provider Geodis said that it had returned to strong growth in the first half of 2010. Together, recent acquisitions and
organic growth drove a 37.1% (841.6 million) increase in revenue to 3,112.6 million.
Significant acquisitions included IBM Global Logistics, IBM's global logistics flow management platform. This business was gradually
integrated as from March 2009, leading to the creation of the new Supply Chain Optimization Division. Other targeted acquisitions enhanced
18th Edition
Geodis' positions in France and abroad, chief among them Giraud International, Cool Jet, Sealogis, STSI, Bertola Servizi Logistici, Chevallier
and Ciblex. These changes added 523.5 million over the period.
The currency effect had a positive impact of 52.8 million on first-half revenue.
On a comparable structure and exchange rate basis, revenue rose 11.7%, or 265.3 million, from the year-earlier period.
While all Divisions contributed to revenue growth, those with the most international profile recorded the strongest increases.
Groupage: Against a backdrop of price decreases, organic growth stemmed from an increase in volumes, which was more pronounced in
express services than in traditional groupage.
Freight Forwarding: Higher air and sea freight volumes, notably between Asia and Europe, lifted revenue in the first half.
Contract Logistics: The start-up of new projects and a slight upturn in the automotive industry business contributed to revenue growth.
Full Truckload: Volumes recovered noticeably for consumer goods and industry, but declined for chemicals.
Supply Chain Optimization (SCO): IBM volumes rose significantly from the year before and new contracts began to take effect. The dollar's
rise against the euro also had a favorable impact on SCO revenue.
EC greenlights Geodis takeover of Giraud
through its IT system. Dealers who are pre-approved for credit place orders electronically, and operations that do not require a human value-add
are performed automatically.
"Ordering in Europe is quicker, more efficient, and error free," Urbinati says. "And the system is always working for the dealers, even at
night or on Christmas Eve."
Long-Lost Partners
Luca Baldoni, account manager for global freight management company Geodis Wilson, had called on Foscarini a few years ago when he
worked for another logistics company that did not offer 3PL services. When he joined Geodis Wilson, he contacted Foscarini again, and found
the company receptive.
Today, Geodis Wilson is working with Foscarini to develop a Web portal system in the United States that clones the system it uses in
Europe, says Baldoni. Dealers who are pre-cleared and have a credit history can log on to a Web portal and place their orders. The orders are
automatically approved and electronically transferred to the Geodis Wilson warehouse in New Jersey, where workers pick, pack, and ship.
This system gives the dealers and Foscarini complete visibility, and operates "hands-free," even while the Italian offices are closed for
summer vacation.
Although Foscarini's U.S. business continues to grow, the company does not locate employees in the United States. It is not uncommon,
however, for Geodis Wilson to provide office space to visiting teams who might come over temporarily to work on a project.
"It may not sound like much," Urbinati says, "but it saves us the hassle of locating a temporary office and negotiating a short-term lease."
Many companies break into a new market this way; maybe adding a small sales office, but typically not operating their own facility. Baldoni
cites the example of one global company that established itself in the United States, then decided to perform its own logistics services. It bought
a facility when the market was bottoming out, and saved a substantial sum on the purchase. "But, the facility has sat empty for the last two
years," Baldoni notes.
The problem for Europeans dealing in the U.S. market, says Baldoni, is that Europe has higher quality products, with lower quantities. The
United States is the opposite lower quality products with higher numbers.
"If a European company doesn't move one million units a year, some 3PLs won't even consider meeting to discuss a possible solution and
partnership," Baldoni notes. "Many U.S.-based 3PLs are driven by numbers and want to fill their distribution center space."
It's a cultural difference, he adds. "Whether the European firm moves $4,000 coats or discount shirts, it's still a $4 transaction for the 3PL."
Building A Relationship
Foscarini wanted an integrated solution where dealers would be able to check availability, place orders, and view delivery times. This is
working well in Europe and helping to position the brand with distributors there, says Urbinati. The partnership also matched Geodis Wilson's
goal of attracting customers who were looking for integrated solutions, rather than mere pick/pack transaction capabilities.
While each 3PL relationship places unique demands on its partners, some consistent qualities are the hallmark of successful partnerships.
Communication heads the list, starting with the prospecting stage and continuing throughout the relationship. Importantly, communication has
to flow both ways. That requires trust and openness both of which are earned over time.
For a new relationship, reputation counts. Networking with other outsourcers to determine a 3PL's reputation becomes part of the selection
process, along with formal information gathering on company size, capabilities, financial stability, and customer references.
Parrot, world leader in wireless peripherals for mobile telephony, entrusts management of its supply chain and reverse logistics to Geodis
Logistics [via website, June 16, 2010]
Following a call for tender launched in 2009, Geodis Logistics has concluded a contract with Parrot covering stock management, equipment
customization and reverse logistics for its products.
Following a stringent competitive process launched by Parrot with all market players, Geodis Logistics has won a multi-year contract to
manage the key stages of the company's supply chain.
As a result, since February 1st, Geodis Logistics has been providing the following services for Parrot out of one of its logistics hubs in the
Paris region:
Receipt and visual quality control of components from Parrots Asian factories
Stock management
Customization of equipment depending on the recipient, with the incorporation of specific software
Assembling kits
Order preparation
Reverse logistics services for products returned to after sales, testing these and where applicable, incorporating them into WEEE
management.
The products concerned are essentially hands-free systems for mobile phones and top-of-the-range multimedia products, destined to be sold
in over 60,000 outlets worldwide. Geodis Logistics takes care of order management for 80 countries in the EMEA and Latin America zones,
supplying the products to Certified Installer networks, automobile accessory manufacturers, non-food superstores and department stores.
The partnership concluded between Parrot and Geodis Logistics illustrates the manufacturer's desire for its customers and users to benefit from
the services of a logistics provider with expertise in the high-tech product sector, capable of guaranteeing high-quality, flexible service.
The technical complexity of our products and market considerations call for flawless distribution to our end customers, said Philippe
Poussin, Parrots Chief Production and Quality Officer at the contract signing. We are convinced that Geodis Logistics familiarity with this
sector will enable it to provide the required levels of quality. For his part, Jean-Paul Vignal, Director of Geodis Logistics, said: I am delighted
with this partnership with Parrot, a leading group which shares our values in terms of meticulous customer service. Our expertise in the hightech sector means we will have no problems adjusting to Parrots constant innovations.
Geodis moves huge wind turbine blades
Geodis Wilson has managed the transportation of two new wind turbine blades for its customer LM Wind Power on an Antonov AN-225,
the biggest aircraft in the world. With a length of 42.1 meters the blades are the longest cargo pieces that were ever flown by an aircraft.
Geodis Wilson is one of the logistics providers of LM Wind Power, a market leader in the international wind power industry, supplying rotor
18th Edition
solutions to numerous wind turbine manufacturers in all main markets worldwide. The two transported prototype blades were produced for a
new type of wind turbine that extends the possibility of efficient generation of clean energy.
Geodis Wilson's Industrial Projects division has built a specialist team to handle wind energy logistics. This transportation involved a full turnkey operation including inland transportation from the LM Wind Power manufacturing plant in Tianjin to Tianjin Airport, China, loading onto
the world's largest freight aircraft AN-225, customs clearance, supervision of unloading and final delivery from the Skrydstrup Vojens Danish
Military Airport (SKS), the only Danish airport capable of handling this large move.
"Our activities in the wind energy sector are well known in the market, but the move of these prototype blades of LM Wind Power allowed
us to conquer a new level of complexity," said Global Manager Wind Energy Projects, Henrik Funk. Philippe Somers, Senior Vice President of
Geodis Wilson Industrial Pojects adds: "The fact that we have an established network presence in both China and Denmark, along with a
dedicated air charter division, on-site expertise and technical support in this sector, certainly helped us to successfully manage this move for and
together with LM Wind Power and Antonov Airlines."
18th Edition
57 (1) 413-5104
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1974
Asset Focus:
Market Area:
Founding Business:
South America
Cargo Agents
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Adolfo Giraldo
CEO
Marketing
Logistics
Adriana Rojas
CFO
30
Ticker Symbol
30 **
Exchange:
600
23
1
ASSETS
Total Transportation Assets:
Total Tractors:
10
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
16
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.12
1
4
Total Tankers:
Total Other:
MAJOR MARKETS
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Aeromexpress Cargo
Airlines
Arrow Cargo
Airlines
Cargolux
Airlines
Airlines
Cielos Airlines
Airlines
Conviasa
Airlines
Cubana
Airlines
DHL
FedEx Express
Iberia Cargo
Airlines
Panama
LAN Chile
Airlines
Panama
Airlines
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Panama
Panama
Asia/Pacific
Europe
North America
GIRAG
Latin/South America
Colombia
Ecuador
Panama
EDITOR'S COMMENTS
GIRAG specializes in the handling of perishable goods and live animals. All of their warehouses are located at
airports.
Provider's Strengths
Imports/exports of air freight.
Provider's Weaknesses
Limited service offering.
18th Edition
82-2-2054-7038
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Automotive/Parts Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Kyung Bae Kim
CEO
Hyoung Ho Kim
Jin Ok Kim
CFO
CIO
1,413
104 **
1,900
712
1
Exchange:
SEO
ASSETS
Total Transportation Assets:
Total Tractors:
169
Total Trucks:
Total Trucks:
52
3.5
Total Other:
Total Trailers:
Total Aircraft:
243
0
10
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
179
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
SAP
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
3M Korea
Industry
Miscellaneous
Location
TM
WM
VA
DCC
Inte IM
Korea
Korea
Hankook Metal
Metals
Korea
Industrial Machinery
Korea
Hyundai Oilbank
Petroleum Refining
Korea
SK Networks
Petroleum Refining
Korea
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Asia/Pacific
North America
Czech Republic
Canada
India
Europe
United States
Korea
Russia
China
Australia/New Zealand
Australia
GLOVIS
Latin/South America
Slovakia
Turkey
EDITOR'S COMMENTS
GLOVIS, formerly known as Hankook Logitech, is part of the Hyundai Kia Automotive Group under its parent
company Hyundai Motor Co., Ltd. It specializes in the automotive, industrial and chemicals vertical industries.
Nearly half of its revenues are Korean based. Its Canadian subsidiary was established in September 2009.
Provider's Strengths
Provider's Weaknesses
18th Edition
55 71 2108-9733
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2003
Asset Focus:
Market Area:
Founding Business:
Brazil
Port Operations
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Fernando Barros
CEO
Leonardo Barros
Lus Eduardo Chamadoiro
Marketing
Logistics
Anderson Salmazo
Srgio Fraga Faria
CFO
CIO
37
Ticker Symbol
31 **
Exchange:
2,200
14
3
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
16
Total Trucks:
121
Total Trucks:
124
Total Other:
35
Total Trailers:
Total Aircraft:
53
Total Ocean:
Total Other:
58
7.4
8
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Americanas.com
Brazil
Avon
Brazil
Claro
Telecommunications
Brazil
Ford Motor
Brazil
Ingleza
Brazil
Brazil
Shell Chemicals
Petroleum Refining
Brazil
Shoptime.com
Brazil
Siemens
Brazil
Vivo
Telecommunications
Brazil
Xerox
Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Grupo TPC
Latin/South America
Brazil
EDITOR'S COMMENTS
Ford is one of Grupo TPC's largest customers. It manages the port operations for Ford in Brazil and received
an award in 2006 for the quality of its services.
Grupo TPC transports around 500,000 vehicles and 2.5 million cellular handsets per year, and an average of
20,000 pharmaceutical orders per day.
Provider's Strengths
Port operations.
Provider's Weaknesses
18th Edition
86-021-61313537
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
China
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jin Qian
CEO
Catherine Wang
Jimmy Geng
Marketing Mgr.
Logistics Mgr.
Kelvin Zheng
Julia Gao
CFO
CIO
29
Ticker Symbol
29 **
Exchange:
550
20
3-5
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
25
Total Other:
Total Trailers:
Total Aircraft:
680
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
2.2
0
4
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): ISC2000
Transportation Planning and Optimization:
Warehouse Management System (WMS):
ISC2000
ISC2000
ISC2000
ISC2000
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
BMW
Guangzhou
BP
Petroleum Refining
Tianjin
Shanghai
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Guangzhou Hutchison
Latin/South America
China
EDITOR'S COMMENTS
Hutchison Logistics Services is a subsidiary of Hutchison Whampoa. Hutchison Whampoa is a major port
operator.
Provider's Strengths
Major Asian corporate group.
Provider's Weaknesses
ProLogis Inc., a Colorado developer of distribution centers worldwide, has two major deals in the Pearl River Delta area of southeastern
China.
ProLogis (NYSE: PLD) said Thursday it will build a 2 million-square-foot industrial park on 102 acres in Guangdong Province. The park will
be called ProLogis Park Zhuhai, and will offer access to South China Sea port cities such as Zhuhai, Macau and Jiuzhou.
The developer gave no timetable for the park's construction.
At its ProLogis Park Sanshan distribution center in Guangzhou, one of Guangdong Province's major cities, ProLogis has cemented a major
lease with third-party logistics provider Guangzhou Hutchison Logistics Co.
Hutchison leased 194,000 square feet at the park for the distribution of BMW auto parts throughout the Pearl River Delta area.
Guangzhou Hutchison is part of Hutchison Logistics Services Ltd., based in Guangzhou and Shanghai.
"BMW required a distribution facility that could provide easy access to the entire region," Qian Jing, Hutchison Logistics Services general
manager, said in a statement.
18th Edition
86-574-8774-2588
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2001
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Bill Liu
Founder
Jason Lou
Alan Zhong
Lucy Yang
Thomas Zhao
CFO
Deputy GM, Admin./HR/Overseas Bus.
Ticker Symbol
42
4 **
225
280
1.5
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
10
Total Other:
Total Reefers:
Total Flatbeds:
0.043
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Pstar
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Latin/South America
North America
CUSTOMERS
Europe
Asia/Pacific
Australia/New Zealand
Industry
Specialty Retailers
J.C. Penney
General Merchandisers
Chemicals
Panasonic
Philips Lighting
Location
TM
WM
VA
DCC
Inte IM
US
China
China
18th Edition
Asia/Pacific
Europe
North America
Spain
United States
China
Headwin
Latin/South America
EDITOR'S COMMENTS
Headwin's business focus is on exports with 40% going to the U.S., 40% to Europe and 20% to other countries.
Its biggest customers are Central Purchasing and J.C. Penney. Its U.S. branch is in Inglewod, CA and Spain office
in Madrid.
Provider's Strengths
Ocean freight.
Provider's Weaknesses
Effective April, 18, 2009, a Project Logistics Department was officially established in Headwin Logistics Co. Limited. This new department
shall provide special services for bulk cargo, OOG and oversized cargo requiring ship chartering and for transportation of extremely large or
enormous project equipment. Stationed in Shanghai and counting on our complete network system, we have great capability in serving our
customers reaching all points on the globe with safe, speedy and highly efficient solutions.
The project team is staffed with professionals with more than 10 years in this logistics industry. Through our risk-free and low cost project
planning, we create logistical value to our clients allowing them to enjoy our services with advanced leading position in their own industry.
We are members of the following three famous global logistics associations, namely, MTG, CLC & GFG with more than 100 associated
agents worldwide, thus enabling us to monitor the whole process at each check-point and offer prompt response for all shipping movements
from port of loading to the destination.
We can provide agency insurance policies which offer effective protection in carrying this project logistics plan.
At present, our new project team is holding contracts with more than 30 ship owners (including ship owners of bulk cargo, RO/RO, crude
oil & chemical gas, etc.) plus 8 special commodity trucking teams. We sincerely hope that these reliable sources can serve you and your clients
with added value to meet your logistics needs.
18th Edition
49 541 605 12 11
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1871
Asset Focus:
Market Area:
Founding Business:
Global
Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Roger Haeussler
Arnold Goldstein
Steve Lee
Julian Riches
Sebastian Brockamp
CFO
VP Customer Solutions & IT Services
Ticker Symbol
3,433
687 **
8,652
150
3
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
2.4
Total Other:
Total Trailers:
Total Aircraft:
0
15
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Food, Groceries
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
LFS 400, WDS
PSI Logistics
Proprietary, Cass
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
ISO Certified Certification Locations: All locations are ISO 90001-1041 certified.
Other Services:
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Specialty Retailers
Columbus, OH
Bacardi Martini
Beverages
Miami, FL
Chicago, IL
Chicago, IL
Caterpillar
Miami, FL
Dana
Chicago, IL
Federal-Mogul
Indianapolis, IN
Lakeland
Specialty Retailers
UK, India
Limited Brands
Specialty Retailers
Entertainment
Entertainment
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
North America
Latin/South America
Angola
Afghanistan
Australia
Austria
Canada
Benin
Botswana
Azerbaijan
Cook Islands
Belarus
Mexico
China
New Caledonia
Belgium
United States
Hong Kong
New Zealand
Bosnia
India
Norfolk Island
Bosnia-Herzegovina
Indonesia
Samoa
Bulgaria
Solomon Islands
Croatia
Tahiti
Czech Republic
Tonga
Denmark
Vanuatu
Finland
Argentina
Bolivia
Brazil
Chile
Costa Rica
El Salvador
Grand Cayman BWI
Netherlands Antilles
Nicaragua
Panama
Paraguay
Peru
Trinidad and Tobago
Africa/Middle East
Burkina Faso
Burundi
Cameroon
Central African Republic
Chad
Congo
Japan
Macau
Asia/Pacific
Maldive Islands
Mongolia
Australia/New Zealand
Hellmann
France
Nepal
Germany
Ghana
Pakistan
Great Britain
Guinea
Philippines
Italy
Kenya
Madagascar
Singapore
Macedonia
South Korea
Malta
Sri Lanka
Moldova
Taiwan
Netherlands
Gabon
Malawi
Mali
Mauritius
Morocco
Mozambique
Poland
Vietnam
Portugal
Romania
Namibia
Serbia
Niger
Nigeria
Rwanda
Slovakia
Senegal
Spain
South Africa
Sweden
Sudan
Turkey
Tanzania
Togo
Ukraine
Slovenia
Tunisia
Uganda
Zambia
EDITOR'S COMMENTS
Hellmann is a privately held German company which continues to be competitive against the big guys. It has
good freight forwarding and contract logistics operations. Coverage in Asia and China is extensive.
In May 2009, Hellmann ceased its U.S. contract logistics operations. It had one contract facility and public
space.
U.S. Headquarters Contact Information:
Hellmann Worldwide Logistics, Inc.
10450 Doral Blvd.
Doral, FL 33178
Phone: +1-305-406-4500
Fax: +1-305-406-4519
Email: infous@us.hellmann.net
Provider's Strengths
Provider's Weaknesses
In a strategic joint venture with India-based Calipar (Parekh Group), Hellmann Healthcare Logistics has selected Dubai as the location for its
newly dedicated Healthcare Hub, due to its highly developed logistics infrastructure and the UAE's focus on the healthcare sector.
Located within the Free Trade Zone of Dubai World Central (DWC), the hub is situated close to DWC-Al Maktoum International Airport
and Jebel seaport.
Exclusive to Hellmann Calipar Healthcare Logistics, the newly built 100,000 sq. ft. multi-user warehouse will cater for the storage and
distribution of pharmaceuticals, medical devices and consumer healthcare products, and complies with all regulatory protocols and current
standards in the sector.
Hellmann Calipar Healthcare Logistics provides temperature- and humidity-controlled storage as well as designated quarantine areas, and the
warehouse is licensed for the storage and the wholesale of pharmaceuticals. An on-site pharmacist will be present at all times.
As part of the end-to-end supply chain solution, Hellmann Healthcare Logistics offers customers in the pharmaceutical, biotechnology and
medical device sectors; warehousing services and inventory management, value added services, hazardous goods storage, purchase order
18th Edition
management, packaging solutions, cold chain management and international, regional and local distribution.
Hellmann expands pharma team in South Africa
Hellmann Healthcare Logistics has expanded its specialist division into South Africa and appointed an in-house pharmacist in order to store
and distribute pharmaceuticals to comply with local regulations.
Currently adapting a 650sqm area in a Johannesburg warehouse, Hellmann Healthcare Logistics (HHL) is working to comply with the local
regulations for the warehousing of pharmaceuticals and licensing in accordance with the Medicines Control Council. Abiding by the legal
requirement that a pharmacist must be present on site, HHL appointed Freda van Loggerenberg as General Manager of Healthcare Logistics in
January 2010.
Working to establish the HHL brand in South Africa, Freda is in discussions with pharmaceutical, veterinary and medical devices companies,
on a local and multi-national scale. Also working closely with the Director of Hellmann Healthcare Logistics, Andreas Lohmeier, the
development of the Healthcare Quality Manual and Standard Operating Procedures pertaining to the logistics and storage of pharmaceuticals is a
key focus over the coming months for the worldwide logistics provider.
The growing activities in South Africa will soon lead to a fully operational healthcare hub which will provide regulatory-compliant end-to-end
supply chain solutions to businesses in the pharmaceutical, biotechnology and medical device sectors.
Andreas Lohmeier, Director of Hellmann Healthcare Logistics said: "The current developments in South Africa are happening at a very
exciting pace. Following the opening of the Dubai hub, HHL is gearing up to providing business across the globe with high quality and cost
effective solutions to enable them to be closer to their customers in emerging markets."
"The opening of the South Africa hub is a great landmark and I predict further developments this year to ensure the healthcare cargo
category maintains its reputation as a competitive specialist and comprehensive solution."
Hellmann Worldwide Logistics, Inc. Announces Partnership with Royal Caribbean Cruise Lines
Hellmann Worldwide Logistics, Inc., one the largest privately held global freight forwarders, has announced it will now be the official partner
of industry cruise giant Royal Caribbean Cruise Lines. Hellmann Worldwide Logistics, Inc. will be providing all vendor management services
including direct vendor coordination and cargo consolidation. Furthermore, HWL will handle all modes of standard logistics services for RCCL
such as air freight, sea freight, and domestic transportation. The announcement comes in conjunction with the official sailing of RCCLs newest
ship the Oasis of the Seas, with 16 decks and 2,700 staterooms it is the worlds largest most revolutionary cruise ship. Hellmann Worldwide
Logistics is currently operating a warehouse facility in Weston, Florida which is now dedicated exclusively for their newly publicized partnership.
In addition, Hellmann Worldwide Logistics, Inc. has acquired an estimated 30 former RCCL employees effective Dec. 2, 2009 which will be
stationed at the Weston facility. Cargo shipments are scheduled to begin on Dec.14, 2009 and will continue consistently throughout the duration
of their four year contract.
Hellmann Worldwide Logistics, Inc. Strategic Partnership with CHEP
The relationship between Hellmann Worldwide Logistics Inc. and CHEP began back in 2005 based strictly on transactional business. Moving
forward to 2010, the union has evolved into a strong and transparent strategic partnership. CHEP is the global leader in pallet and container
pooling services for many of the worlds largest companies. Their customers range in industries from consumer goods, raw materials, petrochemical and automotive industries. The Hellmann CHEP Innovation Team was formed in late 2009. Both organizations voiced the
importance of aligning both companies closer and ultimately driving revenue opportunities for one another. As the CHEP Hellmann partnership
moves rapidly forward several meetings with the newly formed "Innovation Team" have been scheduled to occur at various locations
throughout the year. Hellmann Worldwide Logistics, one of the leading privately held global freight forwarders, has risen above the challenging
logistics environment by forming true strategic partnerships as established with CHEP.
Hellmann launches healthcare logistics solution
Hellmann Worldwide Logistics has expanded its vertical solution portfolio to now include Hellmann Healthcare Logistics, a solution that
combines Hellmann's global experience in the pharmaceutical, biotechnology and medical device sectors.
Hellmann Healthcare Logistics will be a vertical segmented organization within Hellmann Worldwide Logistics.
"We have gained experience in the pharmaceutical, biotechnology and medical device sectors over many years, but never offered an entire
global end-to-end solution," said global director Andreas Lohmeier.
He added: "It's now time to consolidate all our current dealings into a dedicated solution with a dedicated team which provides support of
the entire logistics operation from supply chain design to transport and packaging solutions."
Recognizing that the pharmaceutical industry extends beyond the manufacturers' doors, Hellmann's key areas of focus will be on compliance
and processes, people, equipment and facilities.
As such, Hellmann Healthcare Logistics' solution includes global regulatory compliant processes, regional hubs, healthcare dedicated teams
and transport solutions for ambient and refrigerated products.
Hellmann Worldwide Logistics selects GT Nexus
Quotation, global shipment visibility, allocation tracking, and data feeds into other internal systems are among the areas being considered for
phase two.
INTTRA completes U.S. network for Hellmann
Online ocean carrier booking portal INTTRA said Wednesday it has completed a U.S.-wide network for Hellmann Logistics.
Hellmann's 25 offices are now outfitted with INTTRA Link, a product that allows shippers and logistics companies with high-volume
transactions to link their systems with carriers via XML or EDI. Hellmann's annual export volume from the U.S. exceeds 35,000 TEUs,
transporting commodities such as machinery, paper, forest products, chemicals and resin. The next phase of the contract with INTTRA will see
a global roll out and linking to all 443 Hellmann offices in 157 countries.
18th Edition
86-755-2380 7500
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Ken Mei
President
Huimin Wang
Monica Cheng
VP Marketing
VP Logistics
Ben Zhao
Ligong Wang
CFO
CIO
Ticker Symbol
115
12 **
1,200
500
1
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
300
Total Trucks:
Total Trucks:
150
Total Other:
Total Trailers:
Total Aircraft:
300
Total Ocean:
Total Tankers:
Total Other:
Total Reefers:
Total Flatbeds:
30
Total Other:
MAJOR MARKETS
Consumer Goods
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Haitian
China
Nike
Apparel
China
Wal-Mart Stores
General Merchandisers
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Hercules
Latin/South America
China
Hong Kong
EDITOR'S COMMENTS
Hercules provides VAWD, consolidation, shipping, chartering, import/export, and customs clearance services for
the South China market and is also an NVOCC.
Provider's Strengths
Retail logistics.
Provider's Weaknesses
18th Edition
86-21-60829156
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Asia Pacific
Warehousing
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Michael Zhang
CEO
Wang Xichen
Xu Xinda
25
Ticker Symbol
25 **
Exchange:
500
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
3.2
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Food, Groceries
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Henkel
Kraft Foods
Starbucks
Food Services
Toyota Motor
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
HurryTop
Latin/South America
China
EDITOR'S COMMENTS
HurryTop was a PRC governmental operation growing out of Hua-yun Logistics Industrial Corp.
Provider's Strengths
Provider's Weaknesses
18th Edition
33-327-537-778
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1900
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Michel Fabry
President
Michel Amosse
Michel Pilato
Pascal Poupart
Christian Coulon
CFO
VP IT
20
Ticker Symbol
20 **
Exchange:
150
5
1-5
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.4
Total Tankers:
Total Other:
MAJOR MARKETS
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Apparel
Minneapolis, MN
U.S. Robotics
Chicago, IL
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Benelux
United States
I.T.S. Fabry
Latin/South America
Bermany
France
Italy
Poland
Spain
United Kingdom
EDITOR'S COMMENTS
Small 3PL providing tailored value-added services and value-added tax controls. I.T.S. Fabry has a drop zone
network. It does website development for its clients.
U.S. Headquarters Contact Information:
I.T.S. FABRY, Inc
401 E. Ontario St., Ste. 4602
Chicago, IL 60611
Phone: +1-312-654-0101
Fax: +1-312-654-0202
Provider's Strengths
Good European solution for small to midsized accounts.
Provider's Weaknesses
Limited geographical ranges.
18th Edition
852-2635-2597
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Asian Imports Distribution
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Victor Fung
Ben Chang
Joseph Chua Phi
CFO
329
329 **
Exchange:
2,000
3-5
HKEx
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
100
Total Other:
Total Reefers:
Total Flatbeds:
13
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Food, Groceries
Healthcare
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Infor, Descartes, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Infor
Infor/EXE
Infor
Infor
PeopleSoft, Proprietary--Road Warrior
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Carrefour
Carter's
Apparel
Colgate-Palmolive
Hong Kong
Converse
Apparel
China
Diageo
Beverages
Asia Pacific
Dickies
Apparel
China
Malaysia, Thailand
ECCO
Apparel
Hong Kong
Gap
Specialty Retailers
Hong Kong
GlaxoSmithKline
Pharmaceuticals
Singapore
Guess
Apparel
Pharmaceuticals
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Thailand
Asia/Pacific
Bangladesh
Europe
North America
United Kingdom
United States
IDS Group
Latin/South America
Brunei
Cambodia
China
Hong Kong
Indonesia
Macao
Malaysia
Pakistan
Philippines
Singapore
Taiwan
Thailand
EDITOR'S COMMENTS
IDS Group's parent company, Li & Fung, was founded in Canton in 1906 as a traditional Chinese family
company engaged in trading. In 1937, it was established in Hong Kong as Li & Fung (1937) Limited, which is today
the holding company for the Group.
Li & Fung formed the IDS Group in 1999 to diversify into the distribution business. Today, the IDS Group is
made up of three business segments: Manufacturing, Distribution and Logistics. The Manufacturing segment is
10%, Distribution segment is 72% and Logistics segment is 18% of its total company revenue of $1.8 billion for
2009. Its revenue breakdown by region is: ASEAN 48%, Greater China 46%, UK 3% and US 3%. IDS Groups
industry focus is on apparel, footwear, FMCG and retailing.
Provider's Strengths
Very good SCM from Southeast Asia and China to U.S. and Europe.
Provider's Weaknesses
During the first half of 2009, the Group accelerated its pace in winning new businesses. 47 new contracts were concluded, including logistics
service for Colgate Palmolive in Hong Kong; distribution of additional product lines of SSL Healthcare in Hong Kong; the manufacturing of
diary products for F&N in Malaysia; the Muji hubbing operation in China; distribution service for Jamieson in China; and logistics service for
DSG (Disposable Soft Goods) in Malaysia and Thailand.
Amidst the challenging economic environment, we expect that like-to-like same customer volumes will be significantly down against last
year. Retention and expansion with existing customers as well as winning new customers will be imperative to drive business growth, said Mr.
Chang. We will continue to step up our business development efforts to maintain the pace of new business uptake as well as focus on account
management to maintain a high retention rate.
Operations Review
Greater China
The Greater China region delivered very solid performance in the first half of 2009, with 29% growth in revenue to US$397.29 million, while
operating profit increased 27.5% to US$11.59 million. This was driven mainly by the commencement of new contracts in late 2008 and early
2009, such as Remy Cointreau and Converse in China, Sanofi-Aventis and Philips Lighting in Hong Kong, and Shell lubricants in Taiwan as well
as the acquisition of a healthcare distribution company in Hong Kong in mid-2008.
All markets in the region registered double-digit growth in both revenue and operating profit despite challenges from soft consumer demand.
Hong Kong showed 30.9% growth in operating profit with similar growth rates from both Distribution and Logistics, and Taiwan had a
significant surge in operating profit of 61.1%, driven by the smooth commencement of Shell Lubricant contract as well as improved operational
efficiency.
The Distribution business in China registered outstanding performance whilst Logistics was impacted by volume declines from existing
customers. As a consequence, operating profit in China increased by 19.1%. After being granted approval from state authorities, the Group
commenced distribution of pharmaceuticals, medical devices and OTC healthcare products in China in 2009. This has gone very smoothly as
several new customers have signed up with IDS and numerous other parties have expressed interest.
The pharmaceuticals and medical device trading licenses enable us to issue invoices to hospitals, pharmacy chains and secondary dealers,
thus giving us better control of distribution channels, said Mr. Joseph Phi, President of the IDS Group. We now have a significant presence in
major cities such as Shanghai, Guangzhou and Beijing in pharmaceuticals and medical distribution, and we aim to further expand our presence in
other cities and provinces. We expect to see rapid growth in this business from 2010 onwards.
ASEAN
The ASEAN region also registered respectable 12.7% growth in operating profit to US$12.61 million during the period, in spite of a 7.3%
decline in revenue which was mainly caused by the weakening of ASEAN currencies. Excluding the foreign exchange effect, revenue growth was
6%.
Thailand maintained its momentum, which can be attributed to increased Listerine production volume after adding Australia, New Zealand
and Japan to its list of export markets as well as strong performances from key customers such as Gilead and Procter & Gamble. Meanwhile,
significant progress has been made turning around the business in Indonesia.
During the period, the Group acquired an additional 20% interest in its associated company in Sabah to become the majority shareholder. As
a consequence, the company has become a subsidiary of the Group, and the Group now enjoys a leading position in the distribution of
consumer products across the East Malaysian corridor.
IDS commenced building high-standard healthcare distribution centers in Singapore and Thailand in the first half of 2009. Following the
success of the Hong Kong facility, it is expected that once the new facilities become fully functional by the fourth quarter of this year, it will
substantially strengthen the Groups regional healthcare distribution proposition.
US & UK
Due to the economic downturn, the resulting weak retail spending in the US and UK led to a significant decrease in revenue over the first
half of 2009. Many customers have shown year-on-year volume declines in excess of 30%. Despite the acquisition of a logistics company in the
US in May 2008 and expanded business partnership with Li & Fung (L&F), first-half revenue for the US & UK registered a decline of 38.1% in
2009 compared to last year. Although with the benefit of savings from facility consolidation and cost reduction programs that were implemented
in 2008, the region still recorded an operating loss of US$8.26 million for the period compared to a US$3.34 million loss in the first half of 2008.
The US operation continued to take on more business from L&F, which accounted for about 20% of the revenue there during the first half
of 2009. Additional business from L&F is expected to come on board in the second half, and plans are in place to consolidate all L&F
businesses into a new 650,000-square-foot distribution center on the West Coast towards the end of the year to enhance operational efficiency
and ensure room for business expansion.
In the UK, an agreement has been reached with Marks & Spencer, the largest customer of IDS UK operations, to guarantee the throughput
volume of the distribution center in Leicester. This will ensure that the Leicester facility runs a profitable operation in the second half and brings
the UK business to a better position. IDS is also investigating the viability of expanding its logistics clientele in the UK, which is apparel-centric,
into the consumer sector by leveraging the Groups expertise and customer base in Asia.
With regard to the full-year outlook, Mr. Chang is cautiously optimistic about the second half performance of the IDS Group.
We expect our Asian operations to maintain a strong growth for the rest of 2009 and we will be seeing improvements in the US and UK
business. Together with the revenue generating and cost-cutting initiatives we have undertaken and the potential acquisition opportunities, we
are cautiously optimistic about our second half 2009 performance. I do expect it to be much stronger than last year, concluded Mr. Chang.
IDS Group Reports Strong First Half Profit Growth of 17.6%
Hong Kong, 21 August 2008 Integrated Distribution Services Group Limited (the Group or IDS; SEHK: 2387), an integrateddistribution and logistics services provider, today announced its interim results for the six-month period ended 30 June 2008.
Despite a challenging business environment, profit attributable to shareholders recorded strong growth of 17.6% to US$19.39 million in
2008, against US$16.49 million for the same period in 2007.
Earnings per share for the period were 6.16 US cents (equivalent to 48.01 HK cents), compared to 5.32 US cents (approximately 41.57 HK
cents) in 2007. The Board of Directors declared an interim dividend of 14 HK cents per share, against 12 HK cents for the first half of 2007.
18th Edition
Revenue for the period increased by 40.0% from US$583.15 million in 2007 to
US$816.43 million in 2008, driven mainly by solid organic growth across all key markets, in particular China, Hong Kong, Malaysia and
Thailand, as well as contributions from the businesses acquired in 2007 in East Malaysia and the UK. Core operating profit on a like-to-like
basis, excluding the Slumberland Asia Pacific (SAP) business (which is being divested) increased by 17.6% to US$10.20 million from US$8.67
million. Core operating profit with the first half 2007 operating profit contribution from SAP saw a decline of 4.5% from US$10.68 million last
year to US$10.20 this year.
During the period, IDS continued the progressive divestment of its interest in SAP, and reached another agreement with Hilding Anders for
the divestment of its remaining 40% interest in SAP over a three-year period, commencing this year. Including the one-off gain of US$14.04
million from the divestment of 20% interest in SAP, operating profit in the first half of 2008 was US$24.31 million, up 6.4% over the same
period last year.
The operating environment during the first six months of 2008 had been challenging. Despite weak consumer sentiment, high inflation and
the downbeat global economy, we are delighted that the Group continued to register strong profit growth, said Mr. Ben Chang, Group
Managing Director of the IDS Group.
We expect the growth momentum of the first half to remain strong in Asia especially China for the rest of the year. We are also continuing
to make substantial progress on the M&A front. With our vigilant control of expenses, and our strong business development pipeline, we expect
to continue on our strong performance in 2008. We remain confident in our ability to achieve our 2008-2010 Strategic Plan breakthrough goal of
doubling our profit by 2010 vs. 2007, added Mr. Chang.
Acquisitions Update
In May 2008, IDS announced two acquisitions. The first involved the acquisition of all the shares in Warehouse Technology Inc. (WTI), a
third-party logistics company in the US based in the Los Angeles Metropolitan area, for a total consideration of US$10 million.
WTI provides storage and transportation services to a portfolio of illustrious customers in the footwear, handbags and accessories sectors,
including the Rosetti handbag division of Li & Fung (Trading) Limited (L&F).
Our investment in establishing a strong country resource team comprising the supporting functions of Finance, HR and IT in the US has
resulted in the smooth integration of this acquisition, said Mr. Chang. There are substantial synergies as a result of consolidating our current
logistics facilities on the West Coast with those of WTI.
We will essentially be reducing our US Distribution Centers from 15 to 9 facilities. With better space utilization, we will generate over US$2.5
million savings in occupancy costs alone.
IDS also made its maiden acquisition at its home base, Hong Kong, acquiring 95% of the issued capital of Universal Pharmaceutical
Laboratories Limited (Universal) for a consideration of approximately US$14.6 million. Universal is a leading Hong Kong-based manufacturer
and distributor of pharmaceutical and healthcare products. It runs a GMP certified manufacturing facility in Hong Kong for the production of
generic drugs and is a dominant supplier of certain restricted drugs in Hong Kong.
With this acquisition, we have a much strengthened healthcare operation in Hong Kong, said Mr. Joseph Phi, President of IDS. Our
manufacturing expertise is further expanded to cover pharmaceutical products, thus enhancing our service offerings to our customers. This is
also a strategic move to facilitate a strong entry into the healthcare sector in China, which has enormous potential for us.
Operations Review
Greater China
All markets reported healthy growth in both revenue and operating profit. China continued to register strong revenue and profit growth and
accounted for 19.1% of total Group revenue in the first half of 2008. Operating profit for the Greater China region in the first half of 2008 was
US$9.09 million, up 26.9% compared to last year, excluding the Slumberland business for this region in 2007.
Major contracts won across the region included Asian hubbing services for ECCO in Hong Kong, logistics and distribution service for Shell
lubricants in Taiwan and a number of healthcare distribution contracts in Hong Kong. The Group also secured more business to provide
logistics services for garment companies including LiFung Trinity, a leading high to luxury end menswear retailer, in China, Taiwan and Hong
Kong. IDS invested in building a 6,500-square meter, purpose-designed distribution center for handling both Garment-On-Hanger (GOH) and
flat-pack garments specifically for this contract in Shanghai.
IDS is already the acknowledged leader in the apparel and footwear logistics sector in China, said Mr. Phi. Our foray into the GOH
logistics sector will lead us to the next tipping point of aggressive expansion. With LiFung Trinity as the anchor client in the region, we expect to
aggressively build our presence in the GOH industry and tap into the opportunities to work with other clients of Li & Fung.
Shortly after the period under review, IDS was granted approval in July 2008 from the Ministry of Commerce in China to engage in the
distribution of pharmaceutical products and medical equipment. This marked yet another important milestone for IDS since receiving the CEPA
(Closer Economic Partnership Arrangement) approval to conduct distribution and wholesale of consumer products in 2004, which triggered the
onset of the Groups network expansion in China. Leveraging on the use of its extensive distribution and logistics network, IDS is now ready to
make a stronger entry into Chinas healthcare sector and further strengthen its position as a leading distributor of consumer products,
pharmaceuticals and medical equipment.
This is indeed great news for IDS, said Mr. Chang. We are in the process of finalizing our China healthcare entry plan, taking into account
our newly constructed state-of-the-art healthcare facility as well as the newly acquired manufacturing resources in Hong Kong. From our initial
discussions, we foresee strong interest from multinational healthcare brands to partner with us in this all-important China market.
ASEAN
The ASEAN markets registered stellar performance in the first half of 2008 on the back of major contract wins last year as well as business
growth from key customers such as the Listerine manufacturing business in Thailand. The acquisition of a distribution company in Sarawak in
June 2007 also contributed to the strong performance in Malaysia. Excluding the Slumberland business in 2007, operating profit from the
ASEAN region recorded year-on-year growth of 47.2%.
New contracts secured in the first half of 2008 included the ASEAN hub operation and distribution service for LOreal in Singapore and the
Philippines, respectively, and manufacturing service for new Nestle products in Malaysia. Shortly after the period under review, the Malaysia
team secured the manufacturing contract for Fishermans Friend lozenges, initially covering Malaysia and Singapore, with potential to expand to
other markets such as Indonesia, Hong Kong and Australia.
US & UK
18th Edition
The strategic intent for IDS to expand globally is to connect its comprehensive Asian logistics and distribution network with that in the US and
UK to manage end-to-end global logistics programs for its multinational customers as well as tapping into the customer base of its sister
company, L&F. Investment in the US continued in the first half of 2008 with the implementation of the Groups regional Warehouse
Management System (WMS) in more logistics facilities. The weak retail sentiment in US coupled with the seasonal nature of the UK business,
which is traditionally skewed towards the second half of the year, the region recorded a loss of US$3.34 million in the first half of 2008,
compared to a profit of US$0.26 million during the same period in 2007.
Despite the short-term impact on the overall financial performance, investments in the US have allowed us to establish a much stronger
foundation, and are pre-requisites for our sustainable long-term growth of the business.
The Group has also embarked on facility consolidation and rationalization program in the US to improve utilization. The first phase of the
program was completed in June. The rest of the program will be completed in the second half, with target to reduce the floor space by 20%. It is
expected that the program will translate into substantial rental savings for 2009 onwards.
The UK business, though negatively impacted by the soft retail market, has been tracking better than expected. During the period under
review, the organization was streamlined and the distribution centers were rationalized through improved work process and infrastructure. As a
consequence, operating efficiency was improved resulting in significant cost savings.
We are confident that the businesses in the US and UK will rebound strongly in the second half, said Mr. Chang. Initial discussion with
customers both in US / UK and Asia revealed that the concept of logistics hubbing and end-to-end solutions has gained traction. Our venture
into global logistics will be experiencing an era of high growth in 2009 and beyond.
IDS Selects Descartes' Delivery Management Solutions for China Operations
WATERLOO, ONTARIO - February 27, 2007 - The IDS Group, an integrated-distribution and logistics services provider and a member of
the Li and Fung Group, has chosen Descartes' delivery management solutions to help them enhance the efficiency and productivity of the IDS
Group's service offerings.
IDS, a listed company on the Hong Kong Stock Exchange, provides customized integrated-distribution and logistics solution and services to
multinational organizations in China, southeast Asia and, most recently, in the United States.
"We are honoured that such a respected company in the Asia-Pacific region has selected our solutions to help improve their business
processes." said Arthur Mesher, CEO of Descartes. "Having industry leaders like IDS choose our solutions for use in China is a welcome reward
for our investment and commitment to expanding the use of our solutions in China."
"We have chosen Descartes as our delivery management solutions provider because of their proven deployment of routing and dispatch
solutions on a world-wide basis," said John Anderson, General Manager - Operations of IDS Logistics, Hong Kong. "We look forward to a longterm relationship where Descartes can help us deliver more efficiently for our customers."
IDS will utilize Descartes Route Planning and Dispatch solutions to increase its effectiveness in the area of daily route plans, daily dispatch
and delivery of goods for their customers. Delivery routes will be automatically optimized based upon their customers' demand in quantity,
frequency, timing and service time. The increase in efficiency and productivity will be monitored within the system and will allow for the
inclusion of more performance reports to be generated on a customer by customer basis.
DIAGEO PARTNERS IDS TO OPEN S$13 MILLION REGIONAL LOGISTICS HUB IN SINGAPORE
Development Board, October 10, 2006]
[Singapore Economic
Innovative supply chain process the first of its kind for the beverage alcohol industry
Singapore Diageo, the worlds leading premium beverage alcohol company, and the IDS Group, a premier Pan Asian provider of
Integrated-Distribution and Logistics Services, today announced the opening of the S$13 million Diageo Asia Pacific Logistics Hub at the IDS
Groups logistics facility in Singapore. This strategic partnership, which involves an innovative supply chain process the first of its kind for the
beverage alcohol industry in Asia will handle all of Diageos Asia Pacific logistics requirements.
John Pollaers, managing director, Diageo Asia, commented: Asia Pacific is a key growth market for Diageo. The setting-up and opening of
our logistics hub in Singapore is a complete overhaul of Diageos Asia Pacific supply chain, maximizing our efficiency whilst allowing us to be
more flexible and responsive to meet the needs of a diverse and growing Asian market.
We are extremely impressed by IDS Groups capabilities, track record and their approach to our needs. They are an ideal partner for Diageo
and we have found synergies in our corporate values and culture. Singapores many strengths its infrastructure, skilled workforce and
geographical location made it the country of choice over its many competitors for managing the logistics side of our business in Asia.
Ben Chang, Group Managing Director of IDS, added: This regional hubbing service for Diageo demonstrates IDSs strength in offering
customized regional logistics and supply chain solutions to customers. Our state-of-the-art Automatic Storage and Retrieval System (ASRS)
facility is ideally suited for quick-response hubbing and value-add regional supply chain services.
The flexibility we are able to offer ensures that Diageo can respond rapidly to regional demand and future growth. We see this as the first
stage in a long-term, successful relationship that will develop along with Diageos expansion in the region.
At the official opening, Mr. Lim Siong Guan, Chairman Singapore Economic Development Board, said: Congratulations to Diageo on the
opening of its regional logistics hub. Diageos decision to consolidate its regional management and logistics for the Asia Pacific region and site
its regional distribution centre here is a boost to our aim of becoming the Supply Chain Management nerve centre of Asia.
Already, more than half of the worlds top 25 third party logistics companies have set up significant operations in Singapore. Many of them
have their regional solutions teams based here from which they launch new specialized logistics services for Asia Pacific. By partnering with IDS
Logistics, Diageo has leveraged on IDSs operational excellence in managing this state-of-the-art logistics and warehousing facility.
The new Diageo Asia Pacific Logistics Hub will be located at the IDS Groups ASRS (Automated Storage and Retrieval System) facility in
Tuas, one of Asias largest and most technologically advanced distribution facilities. Premium bottled product such as Johnnie Walker and
Singleton will arrive at the centre from Europe and will then be labelled, packaged, and put through rigorous quality control checks before being
distributed to the different markets including Korea, Australia and China.
Designed to grow in line with Diageos business, the centre will handle 3.5 million cases of Diageo beverages in its first year, growing to 6
million cases in 2007 and 8 million in subsequent years. When working at full capacity, the Diageo Asia Logistics Hub will involve the creation
of approximately 80 jobs.
The Diageo Asia Pacific Logistics Hub makes use of the leading edge technologies available in the IDS Groups Tuas facility, such as the
advanced ASRS and digital imaging capabilities, as well as its customs-bonded area and temperature-controlled zones, to improve process
efficiencies and ensure the quality of the products. As a result of the new Diageo facility, average product lead-times from production through to
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point-of-sale will be cut from eight to ten weeks down to one to three weeks.
The facility will store Diageo inventory to the value of S$60 million and will complete the final market-specific labelling and packaging
(known as postponement) at the last moment on bespoke, high-speed, semi-automated production lines. This will allow one-off initiatives
such as seasonal Diageo promotions in a single market to be rolled out quickly and to a high standard.
Postponement is a common supply chain process for the electronic industry and some parts of the Fast Moving Consumer Goods (FMCG)
industry; however this will be the first supply chain of this type for the beverage alcohol industry.
Diageo will have a dedicated production hall for the automated labelling and finishing of its products, using equipment and operating
processes tailored for the company. Earlier in 2006, Diageo significantly upgraded its Singapore office to Asia regional hub status.
The companys latest investment in Singapore illustrates Diageos increasing commitment to the country as a key base for its rapidly
expanding trade in Asia.
18th Edition
27 11 873 1874
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Supply Chain Management
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Marius Swanepoel
CEO
Abrie de Swardt
Thinus Erasmus
Marketing Director
CEO Transport & Warehousing
Greg Hocking
Gerald Rudman
Financial Director
Services Director
2,145
2,145 **
Exchange:
21,000
50
5-20
JSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
0
Total Trucks:
Total Other:
4,480
571
757
2,068
Total Tankers:
1,546
Total Trucks:
4,480
Total Trailers:
Total Aircraft:
2,582
4
Total Ocean:
Total Other:
600
Total Other:
MAJOR MARKETS
Automotive
Elements
Food, Groceries
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i2 Technologies, OPSI
RedPrairie WMS, SAP WMS
i2 Technologies, OPSI
Accpac, Pastel, SAP
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ABSA
South Africa
Aerosud
Europe
BMW
Europe
brandhouse
Beverages
South Africa
Consol
Packaging, Containers
South Africa
Distell
Beverages
South Africa
Lafarge
South Africa
PG Group
South Africa
Safripol
Chemicals
South Africa
South Africa
Shell
Petroleum Refining
South Africa
Tiger Brands
South Africa
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
Botswana
France
Namibia
South Africa
Germany
Swaziland
United Kingdom
North America
IMPERIAL
Latin/South America
Poland
Zambia
Zimbabwe
EDITOR'S COMMENTS
IMPERIAL Logistics is one of three divisions of Imperial Holdings Limited and contributes 34% of total revenue.
Over 70 operating companies make up IMPERIAL Logistics' five business divisions which are: Consumer Products,
Specialised Freight, Transport and Warehousing, Integration Services, and Support Services. IMPERIAL Logistics
continues to grow these business divisions via acquisition.
Over 55% of IMPERIAL Logistics revenue is generated in South Africa. The major industries served are
automotive, chemicals, FMCG/retail, engineering/construction, and packaging.
IMPERIAL Logistics International division is headquartered in Germany and generates the remaining 45% of
revenue. Panopa Logistik, neska, Imperial Reederei, Brouwer Shipping and Laabs GmbH Tank-Logistic make up
this division. The 600 Other transportation assets shown consist of barges and tugboats based in Europe.
Provider's Strengths
South African supply chain management.
Provider's Weaknesses
Johannesburg, South Africa, 29 April 2010 Gillhuber Logistik Group, a 100% subsidiary of IMPERIAL Logistics Internationals business
unit, Panopa Logistiek has been awarded the management of external warehousing and interplant transport for long-term customer and
renowned car manufacturer, BMW. The additional services will see IMPERIAL Logistics overseeing 1000 deliveries daily, utilizing up to 200
trucks to all BMW Bavarian locations and its Leipzig plant.
Gillhuber delivers an innovative concept to automotive, supplier and consumer goods industries throughout the supply chain, says
IMPERIAL Logistics CEO, Marius Swanepoel. By means of modern IT applications and efficiently organized processes, the company
considerably reduces the proportion of empty runs and substantially increases capacity utilization of equipment used.
He adds that Gillhubers strength also lies in its established customer relationships. Headquartered in Neufahrn near Munich, and with four
additional operations in Germany and two in the United Kingdom, the team has been BMWs logistics specialist for almost 20 years.
Swanepoel explains that Panopa handles the distribution of processed steel rolls, automotive parts, components and the preliminary assembly
of certain products for a number of European vehicle and component manufacturers. It devises holistic logistics solutions offering Just-In-Time
and Just-In-Sequence supply of parts and components to various module assemblers, and also to final assembly sites as required.
With big automotive brands such as Behr, BMW, General Motors, Mercedes Benz, Opel, Porsche, Smart and Volkswagen as customers,
IMPERIAL Logistics offers substantial experience and expertise in this sector, says Swanepoel.
IMPERIAL Logistics Southern Africa has exciting plans to progressively expand these, together with more classic / fundamental logistics
service offerings such as warehousing and transportation in southern Africa.
Swanepoel concludes, The expansion of our logistics operations directly into the automotive sector in southern Africa therefore makes a lot
of sense. Through Panopa and other automotive logistics and transport operations in which IMPERIAL has interests, we can leverage
IMPERIAL Logistics status as a leading automotive logistics services provider in Europe, with excellent operational experience to draw from.
So why re-invent the wheel?
IMPERIAL Logistics Acquires 50%+1 of e-Logics
IMPERIAL Logistics Enhances its Customized Software Offering
Johannesburg, South Africa, 25 March 2010 IMPERIAL Logistics and e-Logics (Pty) Ltd today announced that IMPERIAL Logistics
acquired 50%+1 in the share capital of e-Logics. In the alignment of unique competencies and shared synergies, the acquisition will result in an
enhanced service offering to both companies existing customer base and significant new business development opportunities.
We are excited about the addition of e-Logics to our Integration Services portfolio, says Cobus Rossouw, Chief Executive Officer,
IMPERIAL Logistics Integration Services. Not only are we expanding our technology service offering, we are also improving our business
process outsourcing capabilities to address specific requirements with greater software and systems support, providing integrated solutions as
and when required.
IMPERIAL Logistics comprehensive experience of integrated logistics and supply chain management, complemented by e-Logics multidisciplinary expertise is a win-win combination. The technology services and design capabilities offered by e-Logics will be leveraged to expand
the IMPERIAL Logistics value-add proposition. Rossouw continues: In collaboration, both IMPERIAL Logistics and e-Logics will continue to
focus on the development and implementation of integrated logistics and end-to-end supply chain solutions including transportation operations
and asset management in the rail, road and utilities industries.
Being part of the leading logistics and supply chain management company in southern Africa will boost our development and enable us to
capture new opportunities in the supply chain industry, says Johann van der Westhuizen, Managing Director, e-Logics. Taking advantage of
IMPERIAL Logistics vast knowledge and supply chain expertise, I am confident that we will become increasingly innovative, allowing our
customers to better their performance through improved business processes and technology management.
IMPERIAL Logistics and e-Logics will target new business as well as growth opportunities within their customer base in a structured fashion
and proceed with their strategy of increasingly becoming an extension and part of their customers operations.
Following the transaction, e-Logics will be able to offer their customers 125% BBBEE procurement recognition, in line with IMPERIAL
Logistics formal rating as a Level 4 Contributor. e-Logics, as a member of IMPERIAL Logistics, will continue to promote the pillars of
transformation, focusing on people-related aspects such as employment equity, skills development and corporate social responsibility.
Q&A with Abrie de Swardt, Marketing Director of IMPERIAL Logistics
Supply Chain Digital asks Abrie de Swardt, Marketing Director of IMPERIAL Logistics, about its transatlantic supply chain network,
sustainability and the industrys response to the recession
IMPERIAL Logistics, one of three divisions of the IMPERIAL Holdings Group, has been making a name for itself in logistics and supply
chain management since 1948. It comprises IMPERIAL Logistics Southern Africa and IMPERIAL Logistics International, which is
headquartered in Germany. Following a period of aggressive growth, the company is coming to the fore of the South African industry, and
making its mark on Europe too. Marketing Director, Abrie de Swardt, explains how the company has grown through acquisition to establish
longstanding working relationships, and how it is encouraging sustainable supply chains.
Can you outline the services that IMPERIAL Logistics provides?
Abrie de Swardt (AS): We really provide a service across the supply chain. We operate quite a unique business model in that we do not
subscribe to a particular business model be it 3PL, 4PL, LLP. We believe that its in the best interests of the client to design a solution that
meets their requirements. For example, Red Bull is one of our most recent acquisitions in terms of clients. We provide a route-to-market
solution for them. Lastly, we also provide technology or supply chain consulting, and that really consists of strategy formulation, operations
improvement, people alignment, or technology enablement. We do that either for our own in-house operating companies, or externally to clients
as an added value service or to generate income.
How are the companys operations spread geographically? And how is this an advantage in the market?
AS: We have a really good base in South Africa. We are certainly, by far, the largest logistics and supply chain management service provider in
southern Africa. About 10 years ago, we expanded into Europe with good success. The distribution network in South Africa makes it an
absolute necessity to have offices throughout the country, but our International head office is in Germany. We work very closely with our
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international colleagues to try and create transatlantic supply chains or to leverage best practice; either bringing their solutions into South Africa,
or vice versa. In Germany, we have a leading waterway solution we operate about 600 barges and pushboats. Then we have a leading terminal
solution in Europe. We manage in excess of a million containers per annum, more than eight million tons of product per annum, and that could
be bulk commodities. One of the challenges we face in South Africa is that we are spatially challenged, far from the market, import and export
harbors, and volume is concentrated in Gauteng.
Its no secret that supply chain companies have been hit hard by the recession. How has it affected IMPERIAL Logistics?
AS: We still grew our business, despite the economy. We even improved margins. I think it is testimony to the fact that we have very good,
loyal clients; we have done a great job of keeping our clients over many years, so thats been part of our success. Secondly, its a very well run
business; weve even managed to improve margins, which I think in this kind of economy is an amazing performance. Whats interesting for us
is that we dont seem to be able to see a trend. So there are certainly a lot more peaks and troughs compared to previous periods.
Sustainability and green issues are high on the agenda at the moment. How have you responded?
AS: Sustainability has certainly, for the right reasons, become a lot more important to companies. Its also a lot easier to work with clients on
this type of thing where previously it was seen as frivolous. Weve had great success. We recently did a study with Cardiff University, whereby we
calculated the extra distance traveled as a result of uncertainties in the supply chain and that showed where there are performance gaps. I think
people, for the first time, really link economic benefit to green benefit; in that, not only can you take costs out of the supply chain, but you can
also reduce emissions. The link is being made between taking cost out of the supply chain, and secondly, by being more sustainable in your
approach towards logistics.
Are you working closely with clients to implement solutions?
AS: We are working with customers continuously and, for me, thats a positive thing that one has to take out of the recession. Clients are
more willing now to allow you to engage with them. I think companies are more interested to find better ways of doing things, which allows you
to work closer with them to create more sustainable and cost effective solutions. In the past, it was more about rate; the guy with the lowest rate
would get the contract. It has to be about taking waste out of the supply chain and I think this is what were seeing now.
IMPERIAL Logistics has adopted an acquisitive growth strategy. Is this strategy likely to continue?
AS: Weve grown our business, to a large extent, through bolt-on acquisitions. We have very successfully done mergers and acquisitions and
we are continuously looking for opportunities to grow our business through acquisitions.
What plans do you have for the company in the short-term future?
AS: Its all about growth, but growth in a responsible manner; the manner in which we grow our clients businesses, their brands. Weve just
recently re-launched the IMPERIAL brand, which is exciting. Also, I think expanding our business in the way that we integrated with our
European partners for me, thats quite exciting. I cant comment on that too much but we have very clear plans in that we have to work closer
with our European colleagues. We can certainly complement one another in the markets that we operate.
IMPERIAL Logistics Acquires Stake in Forward Thinking Pragma
Johannesburg, South Africa, 9 November 2009 IMPERIAL Logistics today announced that it has acquired a 36% stake in Pragma
Holdings, with various professionals who are members of Pragmas management owning the balance. The acquisition strengthens the industrial
services capabilities in physical asset management services of IMPERIAL.
Pragma will form part of the recently established Integration Services division. The division is extending IMPERIAL Logistics service
offering beyond the traditional transport and warehousing services to include procurement, operations planning and international logistics
management. says Cobus Rossouw, Chief Executive Officer of the IMPERIAL Logistics Integration Services. The division also houses
Megafreight providing forwarding and clearing services, Volition offering supply chain consulting, Paltrack with specialized services in fruit
export tracking and management and IMPERIAL Logistics Air Cargo focused on express overnight services. The asset care services that Pragma
provides will further complement the development of our Business Process Outsourcing services, concludes Rossouw.
One of IMPERIAL Logistics core competencies is the management of complex operations with its own high-value physical assets or those
of its customers. Supply chain and logistics assets are applied to support customer-centered service excellence. IMPERIAL Logistics is
continuously pursuing opportunities to enhance its demonstrated position as southern Africas largest logistics and supply chain management
service provider. By partnering with Pragma IMPERIAL Logistics obtains access to a world-class physical asset management service, i.e. the
Asset Care Centre Service.
Pragma has recently embarked on an international growth strategy with the aim to increase market share through the establishment of global
networks and partnerships, says Adriaan Scheeres, Chief Executive Officer, Pragma Holdings. IMPERIAL Logistics is well-known for its
continuous improvement and value creating investments. Being a dominant player in the African physical asset management industry, our
partnership with IMPERIAL Logistics is an exciting and strategic development. With significant synergies between ourselves, the deal brings
numerous opportunities to strengthen our local presence across a number of industries, whilst it enables us to invest in various international
projects currently underway.
The investment by Imperial Logistics deepens the Imperial groups involvement in Pragma. Imperials Black Economic Empowerment
partner, Ukhamba Holdings (47% held by Imperial Holdings) last year acquired a 50% interest in Pragma Africa, the division in Pragma which
focuses on the groups South African operations.
Imperial Logistics Increases Strategic Footprint in Construction Industry
Johannesburg, South Africa, 29 October 2009 Imperial Logistics recently announced the acquisition of a 55% interest in Rustgold
Transport (Pty) Ltd, further enhancing its strategic position as a market leader in the southern African construction industry.
The agreement establishes an association of like-minded partners and provides clear synergies to both companies. Imperial Logistics through
its Specialized Freight division serves many of the biggest brands with the transportation and distribution of cement and cementitious products.
18th Edition
Synergies are unlocked as a result of Rustgolds logistical solutions to the construction industry. It specializes in medium and long-distance
distribution of palletized cementitious products.
This announcement is a culmination of months of exploring how the acquisition could produce immediate benefits for both companies.
Being perfectly aligned, the transaction strengthens Imperial Logistics capabilities and paves the way to successfully develop new avenues and
business opportunities, says Nico van der Westhuizen, CEO Imperial Logistics Specialized Freight.
Imperial Logistics provides logistics and end-to-end supply chain solutions to multiple industries in southern Africa and globally. It is active
in the construction industry and provides warehousing, in- and outbound distribution solutions, consulting services amongst others through 3PL
and 4PL business models.
We are well equipped to provide a full range of logistics solutions in the field of specialized freight. However, Rustgold Transport brings
unique capabilities to Imperial Logistics, especially in areas where we endeavour to improve our service offering, says van der Westhuizen. We
also want to increase our market share and through this agreement Imperial Logistics will strengthen its presence in countries such as Botswana
and Namibia, where Rustgold already plays a significant role.
The agreement positions Rustgold Transport strategically with excellent growth prospects as well as direct economic exposure to Imperial
Logistics blue chip infrastructure. Rustgold Transport will leverage Imperial Logistics capabilities that include supply chain intelligence which
will give it a competitive edge to capture future opportunities.
This deal represents significant value for Rustgold Transports shareholders, improves the strategic balance of our business and aligns us
with a leading global and diversified company, with superb tier one assets and a track record of excellence, says Attie Pienaar, Rustgold
Transport Managing Director. Imperial Logistics has a strong commercial focus and is well-known for its continuous improvement and value
creating investments. Being part of Imperial Logistics, we also share in benefits such as bulk fuel procurement and vehicle parts purchases.
Together we will make both businesses stronger to the advantage of shareholders and employees alike.
Imperial Logistics Completes Two Strategic Acquisitions
Imperial Logistics Transport and Warehousing strengthens its service offering and reach
Johannesburg, South Africa, 12 October 2009 Imperial Logistics recently announced the acquisition of two strategic logistics service
providers. Imperial Logistics acquired a 60% stake in Express Hauliers (Pty) Ltd and 70% in Logistical Transport Services (Pty) Ltd. These
acquisitions have extended its logistics service offering and customer base, while strengthening relationships with existing customers as a result
of additional synergies.
We are very pleased with the addition of these two strong logistics players to the group, says Marius Swanepoel, CEO Imperial Logistics.
Both companies have distinguished themselves in their specific markets as significant brands with unique competencies. Not only do they
broaden Imperial Logistics service offering with their extensive experience, our combined strengths and synergies also opens up new markets
and opportunities for growth.
Express Hauliers specializes in express freight and logistics, warehousing and national distribution, including consignments of fast moving
consumer goods (FMCG) into the informal markets located in and around Gauteng. With its headquarters in Boksburg, Gauteng, the company
operates from two DCs in Gauteng and one in the Western Cape. Express Hauliers owns a fleet of more than 100 vehicles and services mainly
customers in the packaging, retail and FMCG industries.
As part of its warehousing operations, Express Hauliers also focuses strongly on inventory management as a value-added service offering to
its customers. With the latest technology support and seamless integration with customers systems, Express Hauliers is able to provide real time
visibility and access to key information.
During the past decade Express Hauliers has captured the fast growing market for the distribution and express freight management of
goods into the informal market sectors of South Africa, says Peter Bignals, Managing Director, Express Hauliers. We are thrilled to be part of
the Imperial Logistics group that allows us access to advanced logistics services and value-added supply chain management capabilities, enabling
us to enhance our service solutions for these niche markets. While opening new markets and adding customers to the Imperial Logistics stable,
we gain the capability to strengthen our business and relationships with our existing customers, realizing a growth benefit for us and our
customers alike.
Based in Durban, Kwa Zulu Natal, Logistical Transport Services (LTS) is a non-asset based logistics service provider offering primary and
secondary distribution solutions. LTS is focused on the supply of competitive and optimized niche market solutions to address specific customer
needs.
The company operates a nationwide service and collaborates diligently with a large base of sub-contractors, ensuring continued access to a
wide range of vehicle types, including 8 tonners, 12 tonners, closed body units, tautliners, tri-axles and superlinks.
We differentiate ourselves in the market through a unique personalized service, supported by key account management that enables us to
continuously and in-time update our customers with regards to their consignments, says Neville Caine, Managing Director, Logistical Transport
Services. Becoming part of this leading logistics and supply chain management company was a natural development in our business relationship
as we have much in common, especially a passion to delight our customers with world-class service delivery. We are excited about the
acquisition and the new opportunities available to advance our customer offering and strengthen our capability to expand our reach.
18th Edition
604-3981996
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1973
Asset Focus:
Market Area:
Founding Business:
Asia Pacific
Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Tee Tuan Sem
CEO
Makoto Takahashi
Chin Then Yuon
CFO
52
36 **
Exchange:
1,300
Kuala Lumpur
ASSETS
Total Transportation Assets:
Total Tractors:
150
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
180
1,050
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
4.1
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): CTMS WAP/Driver Link
Transportation Planning and Optimization:
Warehouse Management System (WMS):
EXCEED
18th Edition
Gateway
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Asustek Computer
Foxconn
Fujitsu
Hitachi
IBM
China
IKEA
Specialty Retailers
China
Japan Tobacco
Tobacco
Lenovo Group
LG
Panasonic
Samsung Electronics
Sanyo Electric
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
China
Malaysia
Asia/Pacific
Europe
North America
China
Hong Kong
Japan
Malaysia
Philippines
Singapore
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
ILB handles 140,000 TEUs per year. Its Malaysian operations contribute to about 40% of its revenue. China
emphasis is on operations in Shenzhen (Hong Kong area) and Shanghai with modern buildings. Land bridges
Singapore to Bangkok. Value-adds include VMI. Warehousing and valued-added services is about 64% of ILB's
revenue. The other 36% is primarily freight forwarding, transportation and distribution.
Provider's Strengths
Transhipment, Asian SCM.
Provider's Weaknesses
Integrated Logistics Bhd, a Malaysian warehousing and supply chain services provider, is focusing on Middle Eastern operations as the
economic conditions have created havoc in its traditional home market and in China.
"Honestly, we cannot see any growth at the moment. Our business in China is down by 20-25%. Our business in Malaysia is also down by 3035%. Our volume is down tremendously," said ILB CEO Tee Tuan Sem.
"Our objective now is to sustain the company," the ILB executive added.
The firm will now concentrate on its Dubai warehouse construction project, where work began in the last quarter of 2008. It is slated for
completion in mid-2010 and will start operations in the first quarter of 2011, primarily catering to consumer products. ILB will also diversify into
oil and gas, chemical storage and temperature-controlled storage in a bid to beat the downturn.
"I'm very bullish on the demand because the warehouse in Dubai is something new, something the group has not done yet. It is a cold room
and this is an automated warehouse," concluded Tee.
ILB postpones warehouse construction in China
[By Yantoultra Ngui Yichen, The Edge Financial Daily, March 30, 2009]
KUALA LUMPUR: Integrated Logistics Bhd (ILB), a logistics services provider with the largest bonded warehouse network in Malaysia, has
deferred the construction of its warehouses in Yantian Port and Yangshan Port in China.
The main board-listed companys chairman Elias Abdullah Ng said the construction of the warehouses would only start upon satisfactory
evaluations of market conditions, even though China was still expected to achieve at least an 8% growth in 2009 amid the global economic
downturn.
In the current economic environment, the group is cautious about further spending on capital investment, he said in the chairmans
statement in ILBs 2008 annual report.
Nevertheless, Elias said the completion of its investment in the chemical logistics industry through 30%-owned tank farm and operator in
China, Foreversun, was expected to increase the yield of ILBs China investment.
RHB Research said Foreversun would scale down its expansion plan due to the difficulty in securing funding. The Jiangsu province-based
company had a solid clientele portfolio comprising oil majors such as British Petroleum (BP) and Shell, and BASF, according to RHB.
We project Foreversun to contribute RM5 million to RM6 million per annum to ILBs profit before tax (PBT) in FY09 to FY11, it said in
a recent research note.
In FY08, ILBs Chinas operations, which include Hong Kong, contributed RM128.61 million or 60% to its total revenue, according to its
financial statement. The balance came from its Malaysian operations.
Elias said Malaysia, in particular, was expected to experience a very challenging year, especially in the first half as industries and companies
sought to weather export slumps and knock-on effects of cutbacks in consumer spending and business investments.
Nevertheless, he said the warehouse business was expected to continue to enjoy high occupancy rates and higher rental rates.
Notwithstanding the lower handling revenue due to slow-moving goods, this will be mitigated by cost rationalizations through manpower
reduction and increase in operational efficiency, he said.
Despite the unfavorable macro economic picture, ILB and its Dubai-based partner National Trading & Development Establishment
(NTDE) remained committed to complete the new RM230 million warehouse in Jebel Ali FTZ, Dubai, according to RHB.
In terms of progress, the research house said the warehouse was now 20% to 25% completed. It was now scheduled to be completed by mid2010, versus end-2009 initially due to the delays in obtaining certain approvals, according to RHB.
Once completed in 2010, the Dubai warehouse is expected to be ready to capture the business opportunities in the next economic upswing,
said Elias.
Nevertheless, RHB said it did not expect material contribution from ILBs 50%-owned venture during the period.
The research house maintained an underperform on ILB with a fair value of 53 sen based on six times FY10 earnings per share (EPS), which
was in line with its one-year forward target price-to-earnings ratio (PER) for the transport and logistics sector.
The counter closed one sen higher at 63 sen last Friday with a total of 90,000 shares changing hands.
18th Edition
Dubai: National Trading and Developing Establishment (NTDE) Group, distributors of over 6,000 products in the UAE and Integrated
Logistics Bhd (ILB) announced a landmark joint venture, under which the two companies will build a central hub in Dubai to provide extensive
logistics services to the Middle East and Africa.
The Dubai hub, built in response to the rapidly growing logistics requirements of the region, will provide a plethora of services to Middle
Eastern and Asian countries, including vendor managed inventories, Risk Management through outsourcing, on-site logistics management, cross
border transportation and regional distribution centers.
The joint venture benefits each company with specialized logistics strengths; has extensive experience in warehousing, storage, fleet
management, third party logistics and IT while ILB is a powerhouse in logistics services, warehousing (bonded and non-bonded), international
freight forwarding and customs brokerage and transportation and container haulage. The venture is geared in particular to handle logistics
operations in relation to electrical and electronics items. The Joint Venture also covers Malaysia, China and Dubai, United Arab Emirates.
"We are broadening our Middle East and North Africa operation with the new central hub in Dubai," said Farid Ahmadi of NTDE. "During
this expansion process it is essential that a world-class infrastructure facility is in place to meet the growing demands of the market. In order to
provide better services to customers, more sophisticated use of technology is vital as these results in associated cost-savings and improved
performance."
New fully integrated technologies are being deployed, as the backbone of this new infrastructure, and will comprise a range of logistics
solutions. As the volume of trade in the Middle East increases and more companies look to do business in and around the region. In the UAE
alone we have seen a tremendous growth in the logistics industry," he added.
"We consider our association with NTDE a valued and timely diversification. The foundation of the new hub is a clear signal that we are
investing in the development of future markets. This step brings us even closer to our customers and allows us to strengthen our focus on their
requirements, in line with our vision to provide better and fast services to our customers," said a representative of ILB.
China operations drive ILBs growth
[By Siow Chen Ming, The Edge Malaysia, February 14, 2005]
Like most Malaysian companies, Integrated Logistics Berhad (ILB) has learnt some hard lesson in China. But it has learnt from past mistakes
and today, its business in China makes it different form its competitors.
ILB first entered China in the mid-1990s, joining other Malaysian companies that were then flocking to set up businesses in the the world's
most populous market. But its timing was unfortunate.
After it completed construction of its first warehouse in Shenzhen in 1997, the Asian financial crisis struck and ILB found no takers for its
space.
Its net profit fell by more than 80% in the financial year (FY) ended Dec 31, 1997, to RM3.07 million. It had then booked a loss of RM49.5
million in FY1998 - its worst year ever - after writing down the value of its assets.
"Now we don't built new warehouses to wait for demand in China. If there is demand, we will rent new facilities straight-away," says Goh
Theow Hiang, ILB's executive director.
Today, ILB derives 60% of its pre-tax profit (after finance costs and share of associates' results) from China with the remainder from
Malaysia, despite a larger asset base domestically. Its rapidly growing China operations, which derives much higher profit margin amid low
operating costs, have expanded group earnings at a faster pace.
Group pretax profit for the nine months ended Sept 30, 2004, was RM16.58 million on turnover of RM133.06 million. Pretax profit has
already surpassed FY2003's figure of RM11.42 million.
While it is currently closing its accounts for FY2004, full-year profit before tax is expected to be between RM20 million and RM21 million.
The management is even looking at an expansion of pretax earnings at a rate of between 30% and 40% for FY2005. This is driven by growth
in its operations in China that is targeted to grow by between 60% and 70% this year.
To cater for the expanding business, ILB expects to increase warehouse storage capacity by the first half of this year from 950,000 sq ft
currently to about 1.8 million sq ft. The expansion is mainly in the cities of Shenzhen and Shanghai to cater for increasing demand from IBM's
PC division and Swedish furniture maker Ikea.
Goh says China's economy is still going strong and foreign investors have not been deterred by the notion of China experiencing a hard landing
in the near future.
"The Matsushita group is setting up its white goods (electrical home appliances) operations in Hangzhou. This will be a very big plant," he
add.
ILB is planning to set up logistic operation in Hangzhou for Matsushita, its largest and earliest client in Malaysia. The company has a good
relationship with the Japanese electrical giant. Incidentally ILB's chairman Datuk Yasuo Takahashi was once an export manager at Matsushita.
Goh sees huge potential in providing logistics services for foreign multinational companies (MNCs) in China. While competition is tough,
ILB claims to be a notch above others in the business.
Goh says the operations in Shenzhen are a successful example of how logistics companies can enhance their scope of services to cater to the
needs of MNCs, which outsource the bulk of their business processes to vendors like ILB to cut cost and to enhance efficiency.
The Shenzhen operations pioneered the "vendor-managed inventory (VMI)" model for IBM's computer division. It handles the whole
logistics process from the inflow of parts (from vendors), to the sorting of parts and storage, followed by the picking of relevant parts to feed
IBM's manufacturing process and finally to handle outward transportation of the finished products on behalf of IBM. This model makes money
for ILB both from the vendors and IBM.
"Our efficiency is more than 99%," says Goh, adding that IBM is expanding its operations in Shenzhen to include the manufacturing of
server computers, a move that bodes well for ILB.
He says the planned acquisition by Chinese computer maker Lenovo Group (formally known as Legend Computer) of IBM's PC and
notebook division will have little impact on existing business arrangements with IBM, currently one of its biggest clients in China.
ILB is currently trading at around RM1.90, which comes up to 20.4 times its annualised nine-month earnings per share of 6.97 sen as at Sept
30, 2004. While its current valuation seems pricey, ILB's share price has remained above RM1.60 since April last year, amid anticipation of
strong earnings growth in FY2005.
Based on current valuations, ILB seems on the high side. But the sexy story in the company is its exposure to the growing logistics business
in China. Domestically, ILB's operation is growing steadily but it is not significant enough because the margins in China are double those of the
business in Malaysia.
ILB poised to ride China boom
18th Edition
Business success in China, one of the most attractive destinations for Malaysian investors, is not guaranteed. Many Malaysian companies,
which went there in droves in the 1990s, ended up failing just after a few years of operation.
Integrated Logistics Berhad (ILB) is not one of these companies. Making its foray into China in 1995, it not only tasted success but also
emerged as one of the top three foreign logistics player in the country as well as the largest bonded warehouse operator in Malaysia.
"Many people went to China in the mid-1990s and came out with nothing. We ventured into China 10 years ago, shortly after our listing on
the back of our financial ability and record in handling multinational corporations in Malaysia," says ILB chief executive officer Tee Tuan Sem.
"Why have many people failed and we've succeeded? Of course, there are many people who say that they were not as lucky but then again,
who would have called me lucky when ILB was badly hit by the Asian financial crisis which led to business slowdown?"
Tee believes that the main ingredient to ILB's success was its ability to remain focused on its core competencies and a strong belief in the
business model. He stresses that it also boils down to management plus the need for perseverance in the wake of adversity.
Today, ILB's clients include some of the largest multinational corporations and companies involved in oil and gas, electrical and electronics,
IT, home furnishing and pharmaceuticals.
"We have 30 years' experience in handling multinational corporations and manufacturers in Malaysia and we have been in the Chinese market
for the past 10 years. ILB is now well positioned to ride the China boom.
"Our China operations will be contributing more to our bottom line from FY2004 from 50:50 last year on the back of faster cargo
throughput, demand, better yields and more available warehousing space this year." Tee says in recent interview.
Starting with basic logistics services when it first stepped into China, ILB has now moved up the value chain by offering third-party logistics,
solutions and supply chain management to meet the growing sophistication and needs of global manufacturers and suppliers.
Tee says ILB is undertaking a RM100 million expansion plan in China with the building of two new warehouses to meet the strong demand
for space from global manufacturers. To date, the company had invested about RM250 million in its China operations.
The additional warehouses in Shenzhen and Shanghai will almost double its space to 164,000 sq m by the first quarter of 2005 from the present
92,000 sq m. ILB will expand its operations to Dalian, Tianjin, Suzhou and Guangzhou in 2005 and 2006.
Tee says China's logistics sector will continue to grow at a rapid rate of 25% yearly, driven by the strong inflow of foreign direct investment
and its entry as a member of the World Trade Organisation.
The China market is currently fragmented with 16,000 registered logistics players. None have more than a 2% market share. "This offers
enormous potential to gain market share," he says.
ILB shares have climbed steadily over the past 10 months on the back of improved earnings. Net profit for the first six months ended June
30, 2004, jumped 233.9% to RM5.81 million from RM1.74 million a year ago.
Tee says ILB's Malaysian operations will continue to be big despite the growing importance of the China businesses. The company operates
241,000 sq m in the Philippines. The company's network also includes Indonesia, Hong Kong, Japan, Singapore and Thailand.
18th Edition
49 (08122) 567-1001
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1981
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
Good 3PL with strong German base and heavy apparel focus.
KEY PERSONNEL
Reinhard Rank
Managing Director
Thomas Bogner
Guido Voss
223
Ticker Symbol
223 **
Exchange:
1,100
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
1.7
Total Other:
Total Trailers:
Total Aircraft:
0
38
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Food, Groceries
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Adidas
Industry
Location
TM
WM
VA
DCC
Inte IM
Europe
Apparel
Europe
Anita International
Apparel
Europe
Baldessarini
Apparel
Europe
Bumler AG
Apparel
Europe
Bogner
Apparel
Europe
Cecil
Apparel
Europe
Europe
Elan
Europe
Erdinger Weissbru
Beverages
Europe
GMG GmbH
Publishing, Printing
Europe
Hako
Industrial Machinery
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Asia/Pacific
Europe
North America
Austria
United States
ITG
Latin/South America
Germany
Netherlands
EDITOR'S COMMENTS
ITG has very strong VAWD capabilities in Southern Germany. North AmericanEuropean freight
forwarding/NVOCC operations are competitive. Only U.S. location is in Boston.
Provider's Strengths
Provider's Weaknesses
18th Edition
55 11 4727 2091
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
South America
Cargo Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Fernando Simes
Irec Rodrigues
Mauro Postali
Sales Director
Executive Officer
Denys Ferrez
Glauco Mariano
623
Ticker Symbol
623 **
Exchange:
9,300
250
11
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
545
Total Trucks:
163
Total Trucks:
163
Total Trailers:
Total Aircraft:
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): E-Cargo
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Braskem S.A.
Chemicals
Alagoas, Bahia
Cebrace Vidros
Argentina, So Paulo
Rio de Janeiro
Prysmian
Telecommunications
Argentina, So Paulo
Esprito Santo
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Julio Simoes
Latin/South America
Brazil
EDITOR'S COMMENTS
Julio Simes provides domestic transportation management and SCM. Other services include passenger
transportation, street cleaning and waste management.
Provider's Strengths
Domestic transportation management.
Provider's Weaknesses
Limited services and scope.
18th Edition
905-795-6422
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1992
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Geoffrey Bennett
Gary Breininger
Keith Matthews
Dir. Marketing
EVP & Co-Chairman
Nikhil Sathe
Richard Adams
CFO
Dir. IT
90
Ticker Symbol
14 **
Exchange:
120
15
1.4
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.2
7
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): MercuryGate, Virtual Dispatch, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
MercuryGate
Proprietary
MercuryGate
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Ashland
Chemicals
Costco Wholesale
Specialty Retailers
Elementis
Chemicals
Frito-Lay
Inventure Group
J.M. Smucker
Jones Soda
Beverages
LG
Ocean Spray
Beverages
Olivieri Foods
Food Production
PepsiCo
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Kelron
Latin/South America
Canada
United States
EDITOR'S COMMENTS
Kelron provides North American transportation management. Its strengths are in Canada and the northern tier
of the U.S. Sixty percent of business is now between points in the U.S.
Provider's Strengths
Canadian and U.S. cross-border third-party transportation operations combining customized solutions and
transportation management. Specializes in small to medium size accounts.
Provider's Weaknesses
LQ: How is risk management in the supply chain putting a greater emphasis on excellence in supply chain practices?
Nikhil Sathe: The supply chain has a heightened importance in today's economic environment. The financial matrix has a direct relationship
with the supply chain performance, whether it is revenue growth, marginal profit, return on capital, or customer satisfaction.
We have seen that 64 percent of the SCMs now report to the CEOs. The SCMs are making probably more rounds to the C-level suite - that's
become of strategic importance. We know that supply chain is critically linked to a cash-to-cash cycle, working capital management. That's
becoming so important to organizations in today's situation. The banks are pressing the reset button on facilities and resetting the covenants.
There is hype and growing attention to the working capital management that organizations have. Supply chain managers have grown in their
stature and their importance to the organizations. We know that supply chain is becoming of strategic importance. They also have the boardlevel appearances at the board meetings. So there is certainly a heightened importance in the supply chain.
Today's supply chain is closely related to financial metrics and it directly or indirectly affects revenue growth, margin of profit, asset efficiency
and customer satisfaction.
Risk management has assumed greater importance with heightened security and compliance environment in the freight transportation.
Flexibility is key in supply chain but is often compromised to drive out the costs.
Quality of supply chain is critical, however supply chain failures keep on happening. Collaboration and optimization have proven to be
extremely essential to a linear and effective supply chain. The biggest risk in freight transportation is the risk of capacity and unpredictability of
rates. It is estimated that more than 60 percent of the capacity in freight transportation lies in a probabilistic environment. Freight forecasting
models can reduce this risk by streamlining forecast information exchange, making freight a tradable commodity and introducing business
interest software applications.
LQ: When your firm looks at developing innovative and sustainable supply chain practices does it look at innovation in its alignment with
partners?
Nikhil Sathe: We have a situation where there's a transactional sale and a transportation management sale. We have seen enterprise
opportunities growing where the financial sale is overtaking the transportation or logistics sale.
You are selling to C-level suite in terms of supply chain opportunities, not necessarily to the logistics managers and director of transportation.
Right now optimization, dynamic routing, and transportation cube manipulation are in the background. Everyone wants to save their nickels and
dimes - it's all about cost-dominating supply chain agendas at the present time. There is definitely a heightened importance.
As the markets are rebounding and capacity is changing, it offers opportunities for 3PLs to position themselves to seize new opportunities.
Unlike 2009, we will see more enterprise level opportunities in managing and optimizing freight. Transactional or our commodity/brokerage
opportunities will also grow as capacity tightens and 3PLs will have to leverage technology and expertise to re-emerge as capacity finders. We
bring in innovation as part of our corporate strategy.
The unspoken rule of innovation is to solve a problem. We believe that big breakthroughs do not cost big money. I recall in one of the
paradoxical studies conducted recently on supply chain, they talked about innovation paradox. New product innovation is growing fast, however
innovation in supply chain is not that quick!
LQ: What are your views on the shared service drivers between 3PLs and logisticians, such as overall savings, efficiencies, better
accountability and enablement of strategic priorities, that will result in some of the most innovative practices in the supply chain?
Nikhil Sathe: I think there is a very exciting and encouraging pattern that is developing in the 3PL growth. Armstrong and Associates is
probably the most reliable data that you can get in the 3PL market space where the rate of growth of outsourcing is almost three times the rate
of economic growth. We have seen certain modal shifts during this time as people are now transferring their freight from over the road to
intermodal - part of the cost-saving initiative and also part of the sustainability green transportation initiative. Two to three percent of GDP
growth is a very exciting trend. While the freight volumes are depressed by 22 percent, we see the level of outsourcing is growing. Every Fortune
1000 company is using at least one 3PL. There is a bigger market share that is coming that's more, not because of the cost control issue, but it's
because of the value-added services. They're gravitating from the brokers, to forwarders, to 3PLs, to lead logistics providers: there are enterprise
opportunities versus transactional opportunities; be a strategic supplier versus a tactical supplier. So we have seen a transformation in the 3PL
capacity of providing service offerings. That's been a major value chain. They are now becoming partners in the supply chain. Supply chain is
broad spectrum. But demand plan is to warehouse managers. 3PLs fit into that as value service providers.
As the level of outsourcing has grown consistently to more than two to three times that of normalized economic growth, shippers have
started to use outsourcing at the strategic management level. 3PLs have moved from being only a broker, forwarder, or logistics service provider
to being lead logistics providers. 3PLs have built their service offerings around shippers' stress points as solutions providers.
LQ: What are the flexibility-based strategies that your firm uses, or its partners, to define its overall supply chain strategy?
18th Edition
Nikhil Sathe: The transactional to enterprise, tactical to strategic, being a business value provider versus a cost saver. Traditionally 3PLs have
been working as capacity finders. But as the capacity is very fluid in the market right now, where supply exceeds the demand, we have a situation
where a sustainable situation on the cost savings is more important than just finding the capacity. This is going to dramatically change in the next
12 to 18 months. I've no doubt about the resilience of the North American economies where we bounce back in terms of our turnaround times
and then demand will exceed the supply. That's where the capacity will become tight and that's where the 3PLs will play an increasing and
progressive role into the cost control and the value-added services.
LQ: How does your firm balance and mitigate risk with innovation and business development?
Nikhil Sathe: I think it's a great question. Yes, there is a heightened importance of the supply chain in the current economic environment.
Supply chain has become a burning platform for the C-level suite. Supply chain managers have been doing the rounds to the C-level suite more
often. They've gained strategic importance with the organization structure today. The financial matrix has a direct relationship with the supply
chain performance. Where there is revenue growth, marginal profit, return on capital, or customer satisfaction, they are directly linked to supply
chain performance. Supply chain is becoming a strategic piece of the organizational performance. We have seen this in the current economy
where cash-to-cash cycle is so important. Working capital management is very important.
Outsourcing is also growing because you want to save money; you're in a capital preservation mode rather than a sales, growth and strategy
mode. Outsourcing fits into that category and supply chain is a burning platform. We talk about a balanced growth and a controlled growth. We
do not want to clip our wings to grow for tomorrow. I want to talk about cost optimization - reduce your baseline costs and maintain services at
acceptable levels. We need to be careful to do this in such a way that does not undermine our ability to capitalize on new growth or revenue
opportunities.
LQ: What's your forecast or outlook in terms of the dynamic between logisticians and 3PLs?
Nikhil Sathe: It's an 80/20 rule. Eighty percent of the 3PL relationships are strategic in nature. But only 20 percent of the shippers'
relationships with the 3PLs are strategic in nature. In terms of the shippers, their primary focus right now is to save money. It's not so much
about customer service or technological advantage. So that's a financial sale today rather than a transportation sale. I think that's a real
transformation in our industry today. This will change. In good times it becomes an optimization rather than a price sale. In today's economic
environment where every dollar is important in the present value concept, that's where it is becoming a financial opportunity.
Kelron Logistics: Providing integrated transport solutions
2009]
[Written by Gabe Perna and Produced by Lorraine Heist, Exec Digital, March 10,
President Geoff Bennett reveals to Exec Digital how Kelron grew from a basement start-up into a premier North American transportation
logistics solutions provider
Considering that Kelron Logistics started out only 17 years ago as two guys working out of a basement, the companys growth and current
size is pretty impressive. With 130 employees spread across five business units in four locations generating approximately CAD $100 million in
revenue, this leading non-asset based transportation logistics solutions provider has certainly come a long way.
We opened up in my basement and worked there until it got too crowded. We would have truck drivers picking up checks and sales guys in
there. It was getting too busy, says Geoff Bennett, current President of Kelron Logistics, who founded the company, along with partner and
Executive Vice President Keith Matthews, in 1992. Bennett says the company quickly expanded from its roots.
We moved to an office in 1993 doing day- to- day freight brokerage. We also represented several trucking companies and found customers
to fill their trucks, and in return would receive a commission on the transactions.
For the firms first few years, Kelron focused strictly on the brokerage and transactional businesses. In 1996, the company opened additional
offices in Vancouver and Toronto. Five years later it began a warehouse business in Toronto and opened an office in Chicago. In 2006 it opened
yet another business unit focusing on transportation management. That same year it opened a brokerage branch office in Montreal.
Today, Kelron offers a variety of solutions. Transportation services offered include On Demand and Dedicated Capacity, both of which are
available for full truckload, less than truckload and intermodal movements. The firm also offers warehousing and distribution, transportation
management and supply chain consulting.
The Kelron Difference
Offering a full line of logistics solutions is not the sole reason for Kelrons significant growth. Bennett points to what the company calls, the
Kelron Difference. This mantra speaks to the companys ability to provide customized solutions, personalized customer service and highly
efficient and professional back office business practices such as billing, freight payment and claims assistance. The Kelron Difference also
includes the companys flexibility when dealing with the variability present in most companys supply chains.
We believe having a competency in both transportation management and freight brokerage gives us a leg up on most of our larger
competitors who dont have an integrated capability to provide both types of services. Or they might have them but dont have the technology
to run them together, says Bennett.
This integrated capability comes in the form of numerous distinct advantages Kelron has over competitors. One major difference is the
companys full North American competency, meaning it is able to transport within and to and from any of the North American countries.
Kelron also has the agility and customer focus sometimes lacking from the larger players as well as the financial stability smaller ones are
challenged to provide.
Winning Technology
Technology is another prominent differentiator between Kelron and its competitors. For one, the company has a unique and proprietary
SQC (supplier quality and compliance) proficiency, meaning it is connected online with several private and public databases interfaced into its
operational system. This enables Kelron to automatically run a check on all available up to the minute safety, insurance and compliance data
whenever it selects a supplier for a particular movement.
The company recently added software to compliment its SQC capabilities. Using SQC as a jumping off point, it also built an interface to a
custom application called DecisionX. The information available through DecisionX further enhances the ability of the companys operations
staff to make the best decision when tendering freight.
For customers, we have a visibility and order management system called EnvisionX, which we worked hard to make as user friendly as
possible. We use EnvisionX primarily for the transactional side of our business, says Bennett.
Kelrons commitment to technology does not end there. The company uses an outside company for an on-demand TMS application called
Mercury Gate, which is a procurement, load tendering, analytical and optimization tool and also serves as a portal for customers using the
18th Edition
companys Dedicated Capacity and Transportation Management services. It allows them to look at transactions which apply to them and share
as much data as they want with their own customers.
Continuous Improvement
Even as one of the leading transportation logistics solutions providers in North America, Kelron always looks to continuously improve. This
includes a dedication to sustainability. Bennett says the company has started a full environmental stewardship campaign with suppliers who are
responsible for 90 percent of their transactions. Kelron works with those suppliers to understand what they are doing to minimize their carbon
footprint and to find out what it can do to assist them in the process and their business overall.
Along with its own internal sustainability efforts, Kelron also participates in the SmartWay Transport Partnership, which is dedicated to
minimizing the environmental impact of the transportation sector.
Another important improvement initiative at Kelron actually comes from within. Bennett says the company encourages a lot of employee
based improvement plans. We have an internal focus to have better employee engagement. We are trying to create a blog to create better
internal communication and idea sharing. As weve gotten larger, its become increasingly important to ensure we let everyone know what is
going on in the business and are able to fully leverage all of the excellent ideas for innovation so many people have, says Bennett. Employees
also stay current with the latest innovations and best practices by participating in various industry training programs.
As for the future, Kelron intends to continue its history of continuous growth, and Bennett feels the company is well positioned to succeed.
Our competencies in the On Demand and Dedicated Capacity side of the business are well established. Now with technology and further
investment were looking to grow the Transportation Management segment by concentrating on customers that have 10 million plus to spend
on freight transportation. We think they would benefit from having someone identify and leverage efficiency improvements so they can get even
more value from the substantial amount of money theyre spending on transportation, says Bennett.
Kelron Logistics Opens New Eastern North American Facility in Montreal
Kelron Logistics, one of North Americas fastest growing full service transportation management solutions providers, has opened its newest
facility in Montreal, Quebec.
We are opening this facility to increase our ability to meet our sales growth objectives, and also expand our reach into different markets to
further meet the transportation needs of clients in Eastern North America, said Keith Matthews, Executive Vice President and Co-Chairman of
Kelron.
Located on the Trans-Canada Highway only minutes from Montreal's Pierre Elliot Trudeau International Airport, this newest location will
provide a wide range of services including full truckload, less than truckload, inter-modal, distribution and fully outsourced transportation
management solutions.
Matthews went on to explain how this newest facility in Montreal will further increase the companys ability to fulfill its mission of working
together to be a leading provider of customer-driven transportation and logistics solutions.
Kelron representatives at this new facility may be contacted by calling 1-866-795-6409 from anywhere in North America.
Frito-Lay Inc Honors Kelron Logistics as Truckload (TL) Carrier of the Year for 2006
Kelron Logistics, one of North Americas fastest growing full service transportation management solutions providers, has been named TL
Carrier of the Year by Frito-Lay.
This distinguished award is presented each year by Frito-Lay to recognize the full truckload carrier who delivers the best performance across
a number of logistics-specific critical success factor areas including on-time delivery, flexibility, communication, and innovation.
As Geoff Bennett, President of Kelron commented, I had the great pleasure of being at the awards ceremony, and felt extremely proud of
our staff as I watched our Western Region Vice President and General Manager, Howard Breslaw, accept the award and congratulations from
our competition.
Bennett went on to explain that Kelrons vision is working together to be a leading provider of customer-driven transportation & logistics
solutions, and noted how this distinguished award signifies the excellent job Kelron front line staff are doing in fulfilling this mandate.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
Large warehousing/logistics player with Hong Kong base and strong PRC freight forwarding.
KEY PERSONNEL
Keng Lam Ang
Chairman
William Ma
Jesse Lui
CFO
CIO
997
Ticker Symbol
590 **
Exchange:
6,000
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
Total Trucks:
2,000
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
Total Trucks:
3,500
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
18
Total Trailers:
Total Aircraft:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Food, Groceries
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): KerrierTMS
Transportation Planning and Optimization:
Warehouse Management System (WMS):
KerrierTMS
KerrierWMS
KerrierVISION
KerrierFMS
KerrierT2
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Beverages
China
Various
China
Various
Chemicals
China
Various
Apparel
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Bangladesh
Australia/New Zealand
Australia
Europe
North America
Austria
United States
Brunei
Belgium
Cambodia
Czech Republic
China
France
Kerry
Latin/South America
Germany
Hong Kong
Netherlands
India
Poland
Indonesia
Spain
Japan
Switzerland
Korea
United Kingdom
Macau
Malaysia
Myanmar
Philippines
Singapore
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Kerry Logistics' business portfolio encompasses contract logistics, international freight forwarding, warehousing,
transportation, distribution, trading, merchandising and a wide variety of value-added services and is now
managing over 18 million sq. ft. of warehouse space, logistics cen6ters and port facilities globally. Its Integrated
Logistics division, mainly VAWD, generates 40% of revenue and its International Freight Forwarding division
generates 60%. Kerry Logistics handles 450,000 TEUs and 115,000 metric tons of airfreight annually.
Kerry EAS Logistics, the brand name of Kerry Logistics in Mainland China, continues to provide high-quality
logistics and solutions to customers in three major areas: freight forwarding, express parcel delivery and contract
logistics.
Provider's Strengths
Strong China and Asian operations, parent company support.
Provider's Weaknesses
As Kerry Logistics' Asia Road Transport arm targets 30 per cent growth in Thailand-Vietnam business
Kerry Logistics has expanded its handling capacity and increased its crane moves to enhance service levels following the delivery of a third
gantry crane at its Laem Chabang terminal in Thailand.
The gantry crane, which takes the total to three at Kerry Siam Seaport, started operations in April and has increased terminal lifting capacity
to 85 moves per hour from 65 moves per hour.
"In order to increase our competitiveness we are investing to improve many aspects of container handling, yard management and IT systems.
The new crane is a key part in this improvement strategy as we strive to deliver a consistent level of service and reduce port stay times for our
shipping line customers" said Kledchai Benja-athonsirikul, Director & General Manager, Thailand.
In other news Kerry Asia Road Transport (KART) is aiming to increase its cross border business between Thailand and Vietnam by one
third in 2010.
KART's major customer for this door-to-door service is a leading beverage cans producer in Bangkok, Thailand transporting products to Lao
Bao in Vietnam, a distance of 880 km which takes three days from pick up to delivery using the East Western Economic Corridor (EWEC) in
Laos.
Kerry Logistics Strengthens Vietnam Network
18th Edition
Kerry Logistics has completed a strategically important piece in its Vietnam network with the opening of the first phase of its new logistics
centre in Danang in Central Vietnam.
The facility will provide around 9,000 m2 of space when completed in the second half of 2010.
The new facility will add to Kerry Logistics' 62,500 m2 facility in Ho Chi Minh City and a 10,300 m2 facility in Hanoi, providing complete
coverage in North, Central and South Vietnam.
Operating in Vietnam as a wholly owned foreign company since 2006, Kerry Logistics was the first foreign company to own and operate
logistics facilities in the country, and now has a comprehensive network of distribution centres and integrated logistics facilities in the major
commercial centres throughout Vietnam.
Kerry Logistics is also a pioneer in building the first ASEAN cross border trucking service, through Kerry Asia Road Transport (KART),
with door-to-door services connecting Thailand, Malaysia, Singapore, Vietnam, Laos and Cambodia, and service coverage from Vietnam to all
South East Asian countries and several destinations in China.
In China, Kerry Logistics' nationwide transport and logistics platform connects with the KART network through its Kunming transport hub
in China's South West.
Kerry Group Limited/Kerry Logistics (683.UK)
Managing Director-William Ma
Pan Asian 3PL, strong presence in Southern China. Kerry Logistics is a Hong Kong based 3PL. It has grown from being largely Hong Kong
based with warehouse being its dominant asset, to being an Asia/China-wide logistics operator.
Integrated logistics represents 80 of Kerry's business (warehouses, trucks, etc...) with the remaining 20 from international freight forwarding.
Domestic China demand is strong especially in the west. Domestic China volumes for the company are growing strongly, especially in the 3rd
and 4th tier cities. This is being helped by the 2nd phase of the mainland Government's stimulus package where individuals receive the 17%
sales tax back on certain items. The 1st phase of this was for white goods in November 2008, the 2nd phase runs for 12 months, and now also
includes computers.
Kerry's volumes to the western parts of China are growing at 30-40 (this is similar in scale to the 50 another company highlighted).
Export logistics - no green shoots. With respect to export logistics, they have seen no green shoots. The Canton fair in April had purchases
down -20 to -25 (less than this in volume terms but customers are switching to cheaper goods). Customers in the US and Europe are not talking
of increased orders.
Global supply chain is still in adjustment phase. The global logistics chain is still in an adjustment phase which Kerry believes will run until
June 2009 for most sectors and until September for the auto sector. As an example North China's raw material stocks are at "normal" levels
while Southern China still has excess inventories of many chemicals.
New postal rules restricted foreigners from doing very small parcels and apparently could lead FedEx to lose 35% of its volumes in China.
Kerry carries on
Kerry Logistics, a major logistics provider in Asia with a focus in the mainland China market, isnt letting a little global recession get in the
way of its ambitious growth plans. Indeed, the Hong Kong-based company is well-positioned and well-insulated to continue its ascent.
It has an asset-light operating model, two key strategic partnerships, is part of a powerful Asian conglomerate Kuok Group and is a
subsidiary of Kerry Properties Ltd., Hong Kongs largest warehouse owner and operator.
Kerry Properties is also a major player in property investment and development in Hong Kong and Mainland China.
Kerry also has two 50-50 joint ventures, one with the U.K.s Wincanton to provide international supply-chain services; the other with
TALKE Logistic for chemical logistics services throughout mainland China.
At the end of 2008, the company entered another joint venture, with major shareholders of T.Join Transportation, a Taiwan forwarder. The
new venture aims to strengthen Kerrys networks in Taiwan, mainland China and Hong Kong and comes as China and Taiwan cement new
economic and trade links.
T.Join operates mainly in road transportation services in Taiwan with services that include truckload transportation, multitemperature
warehousing, logistics and express services. It has more than 200 terminals and sales offices, and a fleet of about 4,000 trucks across Taiwan and
its offshore islands.
Just prior to that move, Kerry Asia Road Transport (KART), Kerrys Thailand-based road transport subsidiary, launched a service between
Kunming, China, and Bangkok. The service for the first time will connect Kerrys Southeast Asian trucking network from Singapore to northern
China. Kerry said it would add a route soon from Guangxi province to Vietnam.
KART was instrumental in building the first Southeast Asian cross-border trucking service linking Thailand, Malaysia, Singapore, Vietnam,
Laos and Cambodia. China is now linked into this network, and, within China, another Kerry transport and logistics subsidiary, Kerry EAS, can
access the Kunming hub, making the network available across all of China and Southeast Asia.
The new network will provide shippers with an option to truck directly to anywhere in Southeast Asia or China, said Alex Ng, assistant
general manager of KART Southeast Asia. It also will provide direct connections to all major airports and ports, he said.
Kerry is a very significant player in China, especially in Hong Kong, said Evan Armstrong, president of Armstrong & Associates, a 3PL
research and consulting firm. Theyll continue to expand.
Kerrys two core businesses are integrated logistics within China and international forwarding. The integrated logistics division covers
domestic warehousing, inventory management, transportation and product customization. The company operates more than 50 warehouses
comprising 16 million square feet and 3,500 trucks in China.
On the forwarding side, Armstrong said Kerry moves about 400,000 TEUs and about 115,000 metric tons of airfreight annually.
Kerrys logistics and forwarding operations generated revenue of $498.2 million during the first six months of 2008, up 21 percent over the
same period in 2007. Net profit of $8.7 million over that span increased 36 percent. Kerrys container volume during that period increased 17
percent to 185,493 TEUs.
Chinas roll-out this month of a 12-year development plan for the southern Pearl River Delta thats designed to boost the economic and
trade integration of the region with the Hong Kong and Macao Special Administrative Regions falls directly into Kerrys operational and
geographic wheelhouse.
The 2008-20 plan, released by Chinas National Development and Reform Commission, is designed to boost the pan-Pearl River Delta as a
center of advanced manufacturing and modern service industries, and as a center for international shipping, logistics, trade, conferences and
exhibitions and tourism.
Goals include the development of two to three new cities in the region, the development of 10 new multinational firms, and expansion of
18th Edition
road, rail, seaport and airport capacities by 2020. They include construction of an 18-mile bridge linking Hong Kong, Macao and the Pearl River
Delta, construction of 1,864 miles of highways in the region by 2012, and rail expansions of 683 miles by 2012 and 1,367 miles by 2020.
Kerry launches first China-South East Asia overland freight transportation network
Kerry Asia Road Transport (KART), the Thailand-based road transport subsidiary of Kerry Logistics, is launching a new service between
Kunming in China and Bangkok.
This will connect KART's South East Asian network to China for the first time and create a seamless trucking service from Singapore
through to the north of China.
KART will also add a route from Guangxi province to Vietnam later in the year.
KART was a pioneer in building the first ASEAN cross border trucking service linking Thailand, Malaysia, Singapore, Vietnam, Laos and
Cambodia, providing a door-to-door service throughout the region. KART has now added China to this network.
Within China, Kerry EAS has built a nationwide transport and logistics platform that can now be accessed through KART's Kunming hub to
enlarge Kerry's logistics network across all China and the whole of the South East Asian region. It will also enable Kerry Logistics' European
customers to develop their supply chain options both for sourcing in and exporting to the region.
"The new integrated network, operated totally by Kerry Logistics companies, will provide shippers with an option to truck directly to
anywhere in South East Asia or China and the service will also provide direct connections to all major airports and ports," said Alex Ng,
assistant general manager of KART South East Asia. Customers will also have full visibility throughout the trucking service.
Customers will also be able to leverage Kerry Logistics' other services, which include international air, sea freight forwarding, warehousing,
distribution, express, customs brokerage and seaport operations within the region.
Trio of problems for 3PLs
Lack of talent, standardization and low margins keep China's logistics industry on a precarious path.
Foreign, state-owned and private domestic firms are angling for business amidst rising costs for warehouse space and power in China. Add to
that a worrying shortage of supply chain professionals in China a situation exacerbated by rising salaries and heavy staff turnover and you
have a challenging situation.
But third-party logistics providers are certainly not turning their backs on the opportunities China presents.
By some estimates half of the 3PLs in the United States have already entered China or plan to do so in the near future. Aside from the entry
of the established major players like UPS, FedEx and Expediters, you also have the entry of companies like Schneider Logistics, Menlo
Worldwide and YRC Logistics, who have all acquired Chinese logistics firms in the recent past.
Regional logistics partnerships in China appear to be the way to success for companies trying to carve out margin in an increasingly
competitive and costly third-party logistics industry.
But 3PL is still the exception rather than the rule in China. Sun Lei, director of the international cooperation department for the China
Federation of Logistics & Purchasing, said at an eyefortransport China 3PL Summit in Shanghai in June that the top 10 companies control less
than 13 percent of the market.
He said China's 3PL industry is forecast to reach $5 billion by 2011 but that's only a fraction of the nearly $650 billion spent on logistics in
China in 2007.
Xuejun Tian, director of China Post Logistics, said the most important trend driving logistics outsourcing in China is the increasing presence
of multinational companies in all sectors.
"The rise in competition from the growth of MNC business in China has spurred Chinese leading manufacturers to upgrade their own supply
chains via utilizing more 3PL services," he said. "The second and third level manufacturers in China are also increasingly fitting 3PL services into
their strategies. Services with high potential are export-related logistics services and nationwide domestic logistics services."
Xuejun added that China's large, state-owned manufacturers tend to establish strategic partnerships with large, state-owned logistics
companies, such as Bao Steel with COSCO, and Sinochem with Sinotrans.
With increased competition has come a squeeze on profits, Xuejun said.
The average margin of logistics companies in 2007 decreased to less than 10 percent, from 30 percent in 2003. Warehousing companies, at 3
percent to 5 percent margin, and trucking companies, at 2 percent to 3 percent, have it even worse.
"Because of low margin, some small and medium enterprises have to leave the logistics market, or be purchased by big logistics companies,"
he said. "The logistics industry will centralize and reorganize because of strong competition of foreign and domestic logistics companies."
Gary So, executive director of Chinese powerhouse Kerry EAS Logistics, agreed. He said now that logistics has been fully opened to global
competition, it is likely to bring in market consolidation.
Meanwhile, Xuejun pointed out that regional logistics partnerships are forming throughout China, helping regions fill in gaps in service by
partnering with neighbors that specialize in that gap.
Xuejun predicted that industrial and commercial companies will pay even more attention to supply chain management in the years to come
and will thus increase logistics outsourcing, but that will strain an already stretched supply of logistics talent.
Lei, of the China Federation of Logistics & Purchasing, said China's total logistics cost reached $643 billion in 2007, an 18.2 percent increase
over 2006. The investment in logistics infrastructure was $204 billion in 2007, a 17.4 percent increase. So demand and investment are growing at
a parallel pace.
What are also growing are logistics joint ventures between foreign and domestic logistics companies.
Two such entities involve U.S.-based YRC Logistics and Schneider Logistics. Executives from both companies spoke at the summit about
how partnering and acquisitions could advance China's 3PL sophistication.
In such arrangements, China partners offer their foreign counterparts better government relations, local knowledge, access to local clients
and markets, and access to local capital, said Nancy Qian, vice president of the joint venture between YRC Logistics and China-based JHJ
Transportation.
YRC offers its Chinese partner access to a large direct customer base, access to technology, global logistics expertise, an enhanced portfolio
of services, a larger sales force, and improved size and scale, she said.
Qian emphasized that an international joint venture must include "a detailed plan to deal with cultural differences." Cultural gaps should be
analyzed, and similarities between the two should be leveraged, she said.
YRC decided to use both the brand names because while it is a known global brand, it's not well-known in China. Conversely, JHJ is a
reputed brand in China, but is unknown outside the country, Qian added.
18th Edition
As for Schneider, the Wisconsin-based company went the acquisition route to launch operations in China.
Jack Gross, senior vice president, Schneider Logistics, said Schneider saw the opportunity to bind together a very fragmented industry. In
China, there are 5.5 million trucks registered to 2.5 million companies. Do the math and you see the average company operates barely more than
two trucks.
This fragmentation is only one reason why Chinese logistics costs are so much higher than those in the United States.
According to Gross, inventory carrying costs and transportation costs, as a percentage of total logistics costs, are actually lower in China than
in the United States. But administrative costs take up nearly four times as much of the pie. A lack of standardization is primarily to blame.
Lack of standards results in various order sizes, equipment types and facilities, he said.
"The cottage trucking industry leads to inefficient use of assets and empty kilometers," Gross said in his presentation. "Use of people instead
of technology results in too many handoffs. Insufficient training and education results in poor execution. Provincial rules lead to sub-optimal
solutions. Poor reliability translates into excess inventory, lead time and customer service resources. Poor planning leads to duplication of
resources both human and physical."
Beyond that, a lack of pallet usage in China "has created major inefficiency around delivery points among major supply chain partners."
Gross said Schneider intends to operate in a hybrid model that combines some owned fleets and some usage of third-party carriers. The
company has access to more than 5,000 trucks in China, including 2,000 carriers on a regular basis and dedicated carriers for long-term contracts
with customers.
As Xuejun indicated, a problem everyone faces is talent. China's young minds are on the lookout for good pay and growth opportunity, but
they're also increasingly willing to change jobs. Not the ideal situation for an industry that needs not only bodies, but stability.
Gina Tay, director of Rasmussen and Simonsen International, a supply chain training and consulting firm, presented results of an RSIeyefortransport survey on logistics staffing in China. The results don't make for great reading for the 3PL industry.
It found that only 14 percent of respondents were satisfied with the overall skill level of their staff, only 5 percent were satisfied with the
overall management skill level of their staff, and 85 percent felt that there was a gap between expected and actual staff performance levels.
The problem is that most companies feel the problem is getting worse. More than half of the respondents said there's not adequate training
to learn about China's supply chain issues, and that staff don't understand their customers' businesses.
The survey also found that management in China tends to focus too tightly on financial goals, and that losing staff to competitors is a
chronic problem. The logistics talent shortfall could reach 6 million nationwide by 2010, with particularly acute problems in Beijing and Shanghai
Tay said.
Government estimates say that by 2010 the logistics industry needs 300,000 to 400,000 1ogistics professionals with at least a junior college
degree annually. But China only turns out 10,000 logistics graduates from its universities each year.
As one might imagine, pay is the biggest incentive in attracting talent, the survey found. Seventy-three percent of respondents said so, along
with 54 percent who said bonus and allowance packages would sway them to join. Farther down the list is a company's ability to offer a
structured career plan (49 percent) and training opportunities (41 percent).
18th Edition
81-3-3201-2666
COMPANY BACKGROUND
Parent Corporation:
Kintetsu Group
Asset Focus:
Market Area:
Founding Business:
Global
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Satoshi Ishizaki
Kiyoshi Kataoka
Takashi Bamba
EVP
GM, The Americas
2,118
360 **
8,893
5+
Exchange:
TYO
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Healthcare
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--UFS
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--UFS
Proprietary--UWS
18th Edition
Proprietary--UFS
Proprietary--OMS
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
ISO Certified Certification Locations: Japan, Singapore, Hong Kong, Taiwan, Philippines, Malaysia, Korea, Canada
Other Services: Capital Equipment - Production Equipment Handling
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Agilent Technologies
Becton Dickinson
Cisco Systems
Daewoo
Dongyang Mechatronics
Hewlett-Packard
MANDO Corp.
Nordson Corporation
Manufacturing
Pall
Industrial Machinery
Panasonic
Airlines
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Afghanistan
Australia
Austria
Canada
Iran
Iraq
Azerbaijan
New Zealand
Belgium
Mexico
Bangladesh
Czech Republic
United States
Cambodia
Denmark
Argentina
Bolivia
Brazil
Chile
Colombia
Costa Rica
Ecuador
El Salvador
Guatemala
Honduras
Nicaragua
Panama
Peru
Uruguay
Venezuela
Israel
Jordan
Australia/New Zealand
Kintetsu
Egypt
Africa/Middle East
Asia/Pacific
Finland
China
Kenya
France
Kuwait
Morocco
India
Nigeria
Japan
Oman
Kazakhstan
Qatar
Saudi Arabia
Korea
Germany
Indonesia
Greece
Hungary
Ireland
Italy
Malaysia
Luxembourg
Tanzania
Pakistan
Malta
Tunisia
Philippines
Netherlands
Singapore
Norway
Sri Lanka
Poland
Taiwan
Portugal
Thailand
Romania
South Africa
Russia
Turkmenistan
Slovakia
Uzbekistan
Spain
Vietnam
Sweden
Switzerland
Turkey
United Kingdom
EDITOR'S COMMENTS
Kintetsus largest operations within their global network are in Japan and China, with over 100 offices located in
each of those countries. Forty-four percent of its business is airfreight based. Ocean and logistics business
accounts for 42%. KWE has a host of strategic joint ventures and affiliated companies. Its verticals are high-tech,
automotive, healthcare and others.
It has 138 logistics warehouses outside Japan, with 6.4 million square feet (warehouse space in Japan is over
2.6 million square feet). Fifty-eight of those warehouses are in China. KWEs 2009 global airfreight volume totaled
882,544 metric tons and it had 517,806 TEUs in its ocean program.
KWE listens to the Voice of the Customer and promotes long-term collaborative business partnerships. Its a
quality management success story.
Provider's Strengths
Automotive support, parts supply, airfreight base.
Provider's Weaknesses
[By Hisane Masaki, The Journal of Commerce Online, May 12, 2009]
Forwarder suffers from sharp decline in air cargo volume Kintetsu World Express, Japan's second-largest international forwarder, said Tuesday
it suffered steep declines in revenue and profit in its 2008 fiscal year ending March 31.
KWE's group operating revenue fell 10.9 percent in fiscal 2008 from the previous fiscal year to $2.67 billion. KWE's group operating,
ordinary and net profit all tumbled because of repeated hikes in fuel surcharges and a sharp decline in the volume of air cargo through Japan
amid the sharp deterioration of the global economy.
Group operating profit plunged 35 percent to $92.5 million, ordinary profit -- similar to pre-tax profit under the U.S. accounting standards -plummeted 38.4 percent to $94.2 million, and net profit nose-dived 62 percent to $35.7 million.
An anti-monopoly fine-related extraordinary loss also contributed to the sharp decline in KWE's net profit. In March, the Japan Fair Trade
Commission fined 12 international freight forwarders a total of about $93.2 million for forming a cartel to raise air cargo charges. KWE was
fined about $15.4 million.
Operating revenue in Japan amounted to $1.17 billion in fiscal 2008, down 10.1 percent from fiscal 2007, and operating profit in Japan came
to $12.2 million, down a staggering 73.2 percent.
Operating revenue in the Americas, which includes the United States, Canada and Latin America, declined 3.5 percent to $384.2 million in
fiscal 2008, and operating profit in the Americas dropped 5.5 percent to $26 million, more than double the operating profit in Japan.
KWE expects to suffer sharp declines again in fiscal 2009. But the company expects a rise in group net profit, partly because the one-off
factor of the anti-monopoly fine-related extraordinary loss will disappear.
KWE expands in the Czech Republic, UK, Canada and Japan
KWE has set up a new company in the Czech Republic, opened new facilities in Wales and Canada, and announced plans to expand its
Narita Terminal.
18th Edition
Kintetsu World Express has established a new company in the Czech Republic - KWE (Czech) - which began operations on October 1st,
2008. KWE (Czech) has also set up a branch office in the city of Pilsen, east of Bohemia.
During the 1990s, KWE expanded into the Czech Republic by commissioning operations to a local agency through a co-operation
agreement. In 2002, KWE established its own business site in Prague as a branch of KWE (Germany). To date, KWE (Germany), through its
Czech branch, has provided high-speed transport services by airfreight forwarding through the gateway terminal in Frankfurt, Germany.
KWE foresees future expansion into businesses such as a truck transport service from these manufacturing hubs to major commercial
markets such as Germany and Russia, as well as distribution and logistics services as a transshipping center for cargo from neighboring Ukraine
and Romania.
In other news, KWE (UK) has established a new combined warehouse and office facility with 3PL functions in Hawtin Park, Blackwood in
southeast Wales. This brings the number of KWE sites in the UK to ten.
The new facility is a result of KWE being awarded a logistics contract by UK confectionary maker Bon Bon Buddies (BBB). BBB's products
are transported by sea from Hong Kong and China, and by truck from Belgium, France and Germany.
In September, KWE (Canada) opened its newly constructed Halton Hills Distribution Warehouse located in Milton, near Toronto.
Until now, KWE (Canada) has provided logistics services from the Milton warehouse that was established in 2004. However, continued
business growth inspired the company to expand its warehousing facilities with the construction of a new warehouse in this area. KWE (Canada)
will use both the existing Milton warehouse and the newly opened Halton Hills distribution warehouse.
In Tokyo, Japan, KWE has announced plans to enlarge the Narita Terminal, with construction due to begin in December 2008 and
completion scheduled for end-October 2009.
The floor area of the terminal will be expanded and a second unit load device (ULD) workstation will be added, which will enable KWE to
operate one ULD workstation designated exclusively for export freight and one exclusively for import freight.
Additional warehousing space on the third through fifth floors will enable KWE to strengthen its provision of high value-added logistics
services, including leveraging its location close to the airport for cross dock operations that must be managed in units of time, work done in
bond, and freight inspection work.
On completion of the tertiary construction, the KWE Narita Terminal will be one the industry's largest single facilities in the Narita area.
Kintetsu World Express signs up to OAG Cargos air freight rates (AFRA) application in 11 countries as database of real-time cargo rates
exceeds eight million for the first time [arabianbusiness.com, August 7, 2008]
Kintetsu World Express (KWE) has signed a contract for its operations in 11 countries in Europe and South Africa to use OAG Cargos
Airfreight Rates (AFRA) application to distribute and search for real-time worldwide cargo rates.
This latest development comes as the total number of airfreight rates published by AFRA exceeds eight million for the first time. In total,
650 airlines have published tariffs on the site (www.oagcargo.com). This information is accessed regularly by over 10,400 users from 1,265
offices worldwide.
Thomas Weppelmann, Director Business Development EA Region, Kintetsu World Express commented By expanding our usage of AFRA
into an additional 7 countries will enable us to build excellent working relationships within our KWE group and our customers as a global
logistics partner.
Bart Jan Haasbeek, Director Key Accounts at OAG Cargo, commented: Kintetsu has been a customer of AFRA in Germany, the UK,
Netherlands and Belgium and with this new agreement, it is extending its use of the application to also include the Czech Republic, France,
Ireland, Italy, South Africa, Switzerland and Sweden. This clearly demonstrates the value the company is deriving from using AFRA as a single
source of rate information in terms of making management decisions and increasing the productivity of its staff. The rapid growth of AFRA
shows that cargo agents and airlines see the application as their preferred way of managing rates both now and for the future.
AFRA enables freight forwarders to make informed decisions about their cargo shipments. Rates previously distributed by airlines in a wide
variety of formats including mail, email with attachments and fax are now accessible through a single web-based application.
This enables users to search for all rates, including general, contract, ad hoc and net rates, to view and compare all rates in one place and view
historical, current and future rates.
The Air Freight Rates application is part of the total cargo portal solution offered by OAG Cargo. Its Inforwarding Announcements service
that enables airlines to publish time sensitive operational announcements to freight forwarders and is now live in 24 countries and states in
Europe, North America, Asia and Australia with further countries due to be added.
In total, there are over 25,000 registered users of the Announcements service. The portal also provides route building, schedules, truck
service points and rates and analysis tools as well as regulations governing the carriage by air of dangerous goods shipments.
Nippon Express, KWE and ANA to create air cargo JV
Tokyo-based logistics companies Nippon Express and Kintetsu World Express (KWE), and airline All Nippon Airways (ANA), have signed
a memorandum of understanding to establish a new joint venture company to provide business-to-business international express delivery
services in Asia.
The new company, which has yet to be named, will begin operations on April 1, 2008.
ANA will hold a 34% share in the JV, Nippon Express and KWE will each hold 28%, and the remaining 10% will be taken by other
forwarding companies.
The three partners said that the reason for the new JV is the increasing need for integrated, strategic distribution services, particularly the
need in Asia for reliable and responsive logistics services to support the supply chains of businesses with rapidly expanding production bases.
Nippon Express and KWE have been developing their own new products independently, and ANA has been working to create a cargo hub
in Okinawa and efficient air network in Asia with plans to move into the international express delivery market.
KWE launches Shanghai Twelve Express
Kintetsu World Express will launch a new airfreight forwarding service in August the Shanghai Twelve Express an ultra express delivery
service that enables cargo exiting Japan to be delivered to a consignee in Shanghais metropolitan area within twelve hours.
Prior to the commencement of this service, KWE will launch the Shanghai Twenty-Four Express service, which provides express delivery
within 24 hours of cargo receipt from the Tokyo Metropolitan area or Kansai region.
The 24-hour service will begin this month for the Tokyo metropolitan area and in August for the Kansai region.
The features of these new services are as follows:
18th Edition
By delivering a single ULD unit to an airline company, KWE is able to load cargo received by 06h00 at its Narita Terminal facility onto a
direct flight that leaves for Shanghai Pudong International Airport before noon on the same day.
The cargo arrives at Shanghai Pudong International Airport in the afternoon, where KWE performs emergency customs clearance
through its local import department and completes the delivery to the consignee within the Shanghai metropolitan area, including Suzhou,
Hangzhou and Wuxi, that same evening (12-hour service).
For cargo received in the evening, KWE performs late night customs clearance and ships the cargo out on the next available flight the
following day, and completes delivery to Shanghai via Shanghai Pudong International Airport that evening (24-hour service).
For the Kansai region, cargo delivered in the evening to any of KWEs cargo centres in Osaka, Kyoto or Kobe is forwarded by KWEs
own vehicles to its Narita Terminal by 06h00 for early morning customs clearance and placing on a morning flight to Shanghai Pudong
International Airport.
These new services will initially focus on the transport of small items such as samples requiring high-speed delivery. KWE plans to expand
the services to include general and large cargo transport.
KWE adds to air import operations warehouse space in Tinjin, China
Beijing Kintetsu World Express Co., Ltd.("BKWE"), a company registered in China that is part of the group of Kintetsu World Express, Inc.
("KWE": TSE 9375) has newly established an air import operations warehouse in the Tianjin Airport International Logistics Zone that
commenced business on April 1, 2006. This brings the total number of business sites within the Tianjin area of China to 5.
Tiajin, an area designated by the Chinese government as a hub for the development of the Balhae Bay coastal region, is an area of intensive
development which, centering on Japanese and South Korean manufacturers of electrical appliances and automobiles, is attracting a large
number of manufacturing companies. Further the ongoing development of facilities around the Tianjin Airport and improvements in
transportation infrastructure have resulted in a continued increase in the amount of airfreight.
Since the establishment in 2000 of the Tianjin Branch, BKWE has been actively expanding sales activities within this area having already
established two sales offices, one airport operation office and one warehouse focusing on domestic logistics within China. Tianjin is now the
fourth largest area in terms of the volume of freight handled after Shanghai, Hong Kong and Dalian.
This air import operations warehouse being KWE's fifth business site in Tianjin is favorably located. In off-peak hours it takes 5 minutes by
car to the airport freight terminal, 30 minutes to Tianjin city, 60 minutes to the Tianjin economic and technological development zone and
Tianjin Port bonded area and less than 2 hours to the city of Beijing. The establishment of this warehouse has made it possible for KWE to
perform its own air import operations in this area and as such it is expected that it will operate to further improve our comprehensive freight
forwarding services.
The opening of this warehouse means that in the 12 months since March of last year the KWE China network has increased by 12 its
number of business sites, with the network currently comprising 10 companies with 97 business sites in 38 cities. In the future, with a goal of
100 business sites, the KWE group will continue to focus on further expanding its China network.
KWE opens a logistics center in Incheon, Korea
The Korea affiliate of Kintetsu World Express, Inc. (TSE 9375) opens a logistics center within the bonded area adjacent to Incheon
international airport, and commence its operations as of 20 January 2006. KWE will be the first Japanese forwarder to have presence in the
Incheon bonded area, and it will be KWEs fourth logistics center in Korea after existing ones in Seoul city, Kimpo and Suwon.
The main features of the Incheon logistics center include: Strategically located within the bonded area with direct connection to Incheon
international airport via underground passage; Fully equipped to handle unit load devices on its own for air freight forwarding; Well positioned
to act as a gateway for Korea-China traffic, with Incheon having both international ports for air and ocean and Equipped with cold storage
facilities for technology and chemical goods related shippers
Since its establishment in 1996 as among the first foreign firms engaged in total logistics, KWEs affiliated company is Korea added to its
logistics expertise. KWE-Korea now handles various cargo, including LCD related electronic parts and components that Korea is competitive at,
after-the-service automobile parts, motorcycles, golf clubs, digital cameras, etc., and will keep providing high-quality logistics services more
extensively, with the opening of its Incheon Logistics Center.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1984
Asset Focus:
Market Area:
Founding Business:
Asia Pacific
Container Haulage
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Haji Ismett Azyze
Chairman
Subaida Haneefa
Loo Hooi Keat
Corporate Communications
EVP
Eddie Thoo
M. Baskar
Finance
Business Process & IT
67
22 **
Exchange:
1,155
Kuala Lumpur
ASSETS
Total Transportation Assets:
Total Tractors:
700
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
5,000
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.8
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Malaysia
Malaysia Navy
Military, Government
Malaysia
Petronas
Petroleum Refining
Malaysia
Proton
Malaysia
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Konsortium
Latin/South America
India
Indonesia
Malaysia
Thailand
EDITOR'S COMMENTS
There are 29 company owned businesses in Konsortium Logistik Berhad (KLB). Major business segments are
automotive (31%), project logistics (15%), oil and gas (6%), and warehousing (5%). KLB appears to be a very
complicated company for the total revenue generated. At last report, KLB was posting large losses.
Provider's Strengths
Automotive LLP capability; southeast Asian transshipment.
Provider's Weaknesses
Cooperative Development Minister Datuk Mohamed Khaled Nordin last week, the latter has given the assurance that his ministry will not allow
a new entrant into the industry.
He (Mohamed Khaled) understands the situation in the container haulage industry and seems to be supportive of the idea that there should
be a strong container haulage industry in Malaysia. And I believe that he will take steps to ensure that the industry continues to be viable, said
Mirzan.
Meanwhile, Mirzan said Konsortium Logistik has received approval from the Securities Commission (SC) to acquire Diperdana Holdings
Bhd and is awaiting the SCs approval for Diperdana Holdings to sell.
"We have somewhat lost the capacity to reinvest because of the sharp decline in tariff rates," he said, adding that prime movers and trailers
were mechanical equipment that wore out after some time.
He said without reinvestment, the industry would have a fleet of aging prime movers and trailers, which would result in higher maintenance
cost and reduced quality in services.
Consolidation within the industry is also inevitable, he added.
18th Edition
203-578-4302
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Global
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
Tier 1 global supply chain manager. The largest ocean freight forwarder.
KEY PERSONNEL
Klaus-Michael Kuehne
Executive Chairman
Reinhard Lange
Peter Ulber
CEO
EVP Sea & Air Logistics
CFO
CIO
16,014
5,394 **
54,680
>100
3-5
Exchange:
SWX
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
75
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): CIEL 4000, KN Road, i2 Technologies
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Oracle--OTM, i2 Technologies
CIEL Warehouse, KN Warehouse
i2 Technologies
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Abbott Molecular
Pharmaceuticals
Aelia
Specialty Retailers
Aero Inventory
Agor Network
Airbus
Akzo Nobel
Chemicals
Apple
Argos
AS&E
AstraZeneca
Pharmaceuticals
Auchan
B&Q
Specialty Retailers
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Iberia
UK
US
UK
Europe
North America
Latin/South America
Afghanistan
Australia
Albania
Canada
Bahrain
Cyprus
Azerbaijan
New Zealand
Austria
Mexico
Bangladesh
Belarus
United States
Cambodia
Belgium
Argentina
Bolivia
Brazil
Chile
Colombia
Ecuador
El Salvador
Guatemala
Peru
Puerto Rico
Uruguay
Venezuela
Egypt
Iran
Australia/New Zealand
Kuehne + Nagel
Angola
Africa/Middle East
Asia/Pacific
Bulgaria
China
Iraq
Israel
Jordan
Hong Kong
Kenya
Indonesia
Lebanon
Japan
Malawi
Mauritius
Kazakhstan
Croatia
Czech Republic
India
Denmark
Estonia
Finland
France
Korea
Germany
Namibia
Kyrgyzstan
Great Britain
Nigeria
Macau
Greece
Saudi Arabia
South Africa
Malaysia
Hungary
Pakistan
Ireland
Philippines
Italy
Singapore
Kosovo
Mozambique
Syria
Tanzania
Uganda
United Arab Emirates
Zambia
Sri Lanka
Zimbabwe
Thailand
Latvia
Liechtenstein
Taiwan
Lithuania
Turkmenistan
Uzbekistan
Vietnam
Luxembourg
Macedonia
Malta
Netherlands
Norway
Poland
Portugal
Romania
Russia
Serbia and Montenegro
Slovak Republic
Spain
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
Kuehne + Nagel is the largest ocean freight forwarding operation handling over 2.5 million containers per year.
It is also the fifth largest airfreight forwarder. With the addition of the ACR group, contract logistics operations more
than doubled in 2006 and are now 54% of net revenues. The current industry segments breakdown for its contract
logistics operations is: Retail 35%, Healthcare 22%, Technological/Telecom 18%, Chemicals 7%,
Automotive 6%, Fulfillment 5%, Misc. 5% and Services 2%.
Kuehne + Nagels North American logistics network totals 12 million sq. ft. of space across 50 DCs. There are
11 DCs in Canada (located in Toronto, Montreal, Calgary, and Edmonton), 30 single- and multi-client DCs in the
U.S., six facilities in Mexico, and four Mexican border locations for transborder/customs services.
Americas business for Kuehne + Nagel is 13% of net revenues. Net revenue was $713 million in 2009 for the
Americas with over 50% from freight forwarding.
Kuehne + Nagel has developed its own land transport management and trucking network for Europe.
Provider's Strengths
Good top management, solid operations on three continents.
Provider's Weaknesses
Is it big enough to stand alone as a global LLP?
Key Personnel:
Dr. Juergen Rahtz, Ph.D., Senior Vice President, KN LLS North America
Stewart Dunsmore, Senior Vice President Global Business Development, KN LLS
Dennis Williams, Vice President Solutions Development, KN LLS North America
Peter Haver, Vice President Business Management, KN LLS North America
18th Edition
software, CIEL 4000, a single global operational platform, is used to create documentation, plan transportation and manage events. The internet
overlay for users is a suite of information value products, underscored by the KN Login web-enabled visibility suite. Interfaced to it are the
transportation management system (TMS), warehouse management system (WMS), electronic data interchange (EDI) and other capabilities.
In the United States, Kuehne + Nagel uses Oracle (G-Log) TM extensively in coordination with its contract logistics (VAWD) operations.
In Europe, i2 is used for contract logistics and the Rail & Road Logistics division. Rail & Road has expanded significantly in the last two years
in competition with Schenker/Railon, DFS and others.
5,200 Seafreight division personnel rely on the CIEL 4000 software to manage its ocean container shipments.1 There are extensive
paperwork and filing requirements for non-document international shipments (invoice, bill of lading, advanced manifest, etc.) plus a series of
cargo control events (handoffs) for any shipment. In todays logistics environment, it is as important to move information as it is to move
cargo, thereby creating a dual workload responsibility for all operational staff around the globe. ISO quality systems and protocols underscore
all Kuehne + Nagel operations to provide uniformity and standardized productivity. The program is QSHE (Quality, Safety, Health,
Environment and Security).
A useful feature of the CIEL system is that photo imaging of all documents works very well. For any shipment, an invoice, bill of lading or
other paper document can be retrieved and reviewed. Kuehne + Nagel is ahead of its major competitors with this capability.
For every shipment, Kuehne + Nagels information value products provide visibility from booking through delivery. Planned and actual
events are time defined and exceptions are quickly and systematically identifiable. Reporting of events, for internal staff and clients alike, can be
customized by each user with a customized dashboard. In addition, Kuehne + Nagel has deployed a robust global reporting platform, Business
Objects, which pools all data generated from the globally standardized operating applications in order to provide flexible and scalable
reporting solutions.
These systems afford Kuehne + Nagel the ability to act as an IATA certified, Cargo 2000 Phase II provider for all stations around the globe.
Cargo 2000 Phase II entails the door-to-door monitoring of heavy weight shipments against predefined route maps which are systematically
maintained, monitored and updated. The route maps serve as the baseline which all events of a shipment are measured against. Kuehne +
Nagel is the only airfreight forwarder with this process for their entire network. Kuehne + Nagels airfreight operation handles about 30,000
shipments per week.
Unique to Kuehne + Nagel, customs brokerage operations are also integrated into the globally standardized applications wherever possible.
For example, in the U.S. brokerage operations are conducted through 41 offices by 250 personnel within the CIEL system and its customs
brokerage subset. One-third of Kuehne + Nagel brokerage staff members hold individual licenses. Over 300,000 entries were filed with the
bureau of U.S. Customs and Border Protection (CBP) in 2006. Real time Automated Broker Interface results are online in KN Login. Kuehne
+ Nagel can handle and clear shipments centrally through Chicago or the closest CBP office.
Kuehne + Nagel handles post entry work such as Customs Form 28/29. Periodic duty payments, foreign trade zone entries, insurance and
carnets for trade shows are routinely handled. Remote location filing, electronic invoice processing, automated classification, and electronic
7501 data migration are standard processes of advanced entry services.
In conjunction with the organizations ISO 9001 protocols, Kuehne + Nagel has developed a standard operating procedure for quality
brokerage management. Kuehne + Nagel is C-TPAT certified and validated.
A useful feature for Kuehne + Nagel customers is its ability to "burn" a CD of entry documents indexed by entry number. Also, scanned
documents can be sent as PDF files to customers secured servers. This assists Kuehne + Nagels partners in compliance and regulatory matters.
Lauren Carribean's operation, based in the Chicago suburb of Elk Grove Village, has 150 people and operates seven days a week. Lauren is
also responsible for smaller offices in St. Louis, Kansas City, Denver, Minneapolis and Detroit (with 7-45 people in each office). In Chicago,
there are 16 employees in customs brokerage. Seven staff members are licensed brokers.
The Chicago office handles about 10,000 shipment transactions a month. About 4,500 are airfreight, 3,000 are ocean and 2,500 are in
customs. Ocean freight inbound runs twice as heavy as outbound. A major challenge, for forwarders and shippers alike, is the reduced staffing
levels at the steamship lines which slows communications. At the same time, the challenges posed by container lines make it easier for Kuehne
+ Nagel to offer its high quality service. About 80% of Kuehne + Nagel's container volume is from customers with 100-1,000 containers a year.
Carribean's Chicago dock operation has 127,000 square feet of dock space. It runs heavy on airfreight particularly on Friday night and
Saturday morning loading consolidations to 150 destinations. Twice a week Kuehne + Nagel operates its own 747F charter service to and from
its Frankfurt hub. Cargo for the charter flights, as well as commercial uplift, is all handled in the Chicago facility.
Kuehne + Nagel loads and unloads all types of airline pallets or Unit Load Devices. "Cookie sheets" (one type of airline pallet) are frequently
used as a base for 10 or 20-foot groupings of airfreight shipments. These devices are transferred to and from the airlines on roller bed trucks.
Ocean containers are loaded tightly using lumber and airbags. The airbags are inserted and inflated to prevent cargo from shifting. Kuehne +
Nagel professionally stuffs containers to eliminate cargo damage.
Cargo is tracked in the warehouse with barcode labels, license plates and guns. There is a security cage and some racked storage is done. Air
and ocean shipments are sent daily. The largest customers are in the high-tech, pharmaceutical and medical industries.
Complimenting the Elk Grove forwarding operations are two suburban Chicago value-added warehouses. Kuehne + Nagel Contract
Logistics grew substantially with the purchase of French-based ACR in 2005. Kuehne + Nagel has more than 400 contract logistic warehouse
locations in 55 countries. 25,000 employees work in contract logistics. The customer list covers all verticals but pharmaceuticals and high-tech
accounts are especially prevalent.
The main service lines are single client, dedicated warehouse solutions and multi-client contract operations. Profitability in large, single client
dedicated warehouses is driven by product value and the degree of value-added services. Kuehne + Nagel's multi-client warehouses also
emphasize high value products with extensive value-added services but allow for more labor saving practices and normally higher margins. A key
marketing aspect of multi-client warehousing is to keep the space filled with complimentary operations.
For its WMS, Kuehne + Nagel uses CIEL and Provia's FourSite. These WMS routines are integrated to KN Login and the TMS. As a result,
customers have carton level visibility to all inventory at all times. Radio frequency (RF) labeling and reading practices are standard.
Kuehne + Nagel's list of value-added services covers the gamut. Product transformation activities include sub-assembly and
postponement/build to order.
Kuehne + Nagel has 25 multi-client warehouses in the United States. There are six in Mexico and six in Canada. Fifteen dedicated
distribution centers are operated. The Mexico operations are among the best in that country. All of these operations have the Oracle (G-Log)
TM capability and KN Login visibility
Kuehne + Nagels Critical Service Logistics (CSL) supports field engineers with deliveries within pre-specified periods of time by
incorporating flexible contact center capabilities, visibility tools and forward positioning of inventory from more than 175 stocking locations
across the globe. Customers include Sun Microsystems, Xerox, Johnson Controls and Tomo Therapy. Returns are tracked to repair vendors.
Kuehne + Nagel's two multi-client facilities in the Southern Chicago suburb of Alsip are just off the I-294 and I-80 highways.
Alsip 1, on Pulaski Road, is 370,000 square feet with 37 dock doors and one drive-up ramp. There is 21,500 square feet of temperature
controlled space. The anchor tenant is Merisant (Equal). Kuehne + Nagel provides complete SCM services, including returns, for Merisant. Also
18th Edition
in this facility is MAN Roland's printing press replacement parts inventory. This location is MAN Roland's global parts depot. This operation
has 21,000 SKU's some of which are kept for printing presses still working after 50 years.
Alsip 2 has a set of high value, healthcare and parts related customers. Its a good example of Kuehne + Nagel's contract logistics market
focus. This 235,000 square foot warehouse includes 41,000 square feet of temperature controlled space. Takeda, a manufacturer of Actos (an
insulin sensitizer for type 2 diabetes), occupies over one-half of this space. Alsip 2 is the U.S. distribution location for Takeda. PTS Labs takes a
chunk of the rest.
Another major client is Omron Healthcare. Omron manufactures diagnostic equipment such as blood pressure monitors and thermometers.
Kuehne + Nagel handles ASN (USC 128) orders, retail compliance, picks and packs and manages transportation in and out. An onsite lab is
maintained by Omron. Alsip 2 is Omron's North American distribution center. Radio-frequency identification (RFID) is used for Omron's WalMart business.
Another healthcare related customer is U.S. Surgical, a division of Tyco Healthcare. Services for this customer include cross-docking.
Non-healthcare related customers include Rheem, Denso Automotive, Woodward Governor and BMW. For Rheem, Kuehne + Nagel
provides postponement and wiring services. Denso is a Toyota dealer supplier of alternators and other parts. Alsip 2 is Denso's North American
distribution center (store, pick, pack, route and ship). The Woodward Governor operation is similar.
The BMW business is housed in a separate facility. It is reverse logistics and cores management. The cores are sent to Germany for
reprocessing.
Alsip 2 is a well run warehouse. All the KPI's are very good. But the thing that really struck me was the mix of high value commodities and
the capability to maximize operations in this multi-client warehouse. These Kuehne + Nagel customers are the kind who need and can support
high quality, global supply chain management.
1 A&A estimates that Kuehne + Nagel handles 450,000 TEUs a year in the Asia-China line. Most of this traffic is handled as Blue Anchor Line,
its Federal Maritime Commission approved NVOCC. Included in this ocean freight volume are 40,000 TEUs of consolidated LCL shipments.
Forwarders need cool heads in a demanding market
Around 90 percent of customers that are using powered refrigeration to shift temperature-sensitive airfreight are moving high-value
pharmaceutical or healthcare products, Envirotainer CEO Thomas Persson says.
There are small flows of specialty foods such as mozzarella cheese, but mainstream shippers of perishables prefer to pay less for a solution
involving dry ice or cooling blocks and will simply factor in a percentage of loss from spoilage.
Kuehne + Nagels philosophy, as it set about uniting its major stations under one global fresh to door concept in 2008, was to try to
control the end-to-end supply chain in the five key perishables categories of vegetables, fruit, flowers, meat and fish.
That may mean picking up flowers from the grower in Kenya by refrigerated truck and delivering them to the importers cooler at a
destination airport halfway across the world, in the middle of the night using a computer access code if necessary.
It is a complex business, explains Dennis Verkooy, Amsterdam Schiphol-based global director air freight perishables logistics at K+N. Fresh
cut flowers need to travel at +2 to +3 degrees Celsius to arrive in optimum condition; bell peppers and tomatoes, a major export stream out of
the Netherlands, at +8 to +12 degrees; and tropical fruits at +15 to +20 degrees.
Some customers may be unwilling or unable to pay for dedicated insulated containers, Verkooy says. You have to be honest. Everyone
talks about the cool chain, but if its a passenger aircraft, you dont know if the pilot is keeping the hold temperature at 5, 10 or 25 degrees. On
a full passenger flight, you will have four or five positions for freight and you may get incompatible cargoes traveling next to each other.
Where every penny counts to the customer, they will keep their fingers crossed for eight hours rather than specify insulation blankets or
active cooled containers. If there is no perishable freight going back from the destination airport, active refrigeration can be an expensive
solution: an empty Envirotainer weights 750 kilos at up to $3 per kilo.
K+N grew its perishables business 23 percent last year, in the worst year ever for airfreight, Verkooy says. He points out that for fresh
beans and strawberries from Egypt, basically grown in the desert almost for free, the logistics can represent 70 or 80 percent of the consumer
price in the supermarket. In this cutthroat market, how does a forwarder differentiate its service? We urge our staff to learn all there is to know
about the product that our customers are shipping. When they know what theyre dealing with, they can explain why a more expensive solution
may be appropriate, but will still keep an eye on the cost.
A personal relationship with the customer is essential. The days of typing out an airwaybill and waving goodbye to the shipment at the
airport are over. When an export shipment for Canada is in the system in Brazil, for example, it is also in the inbound system and our people in
Toronto will pre-alert the customer accordingly. At pick-up next morning, there are no hidden charges, no surprises.
Even in the healthcare and pharmaceutical segment, active refrigeration is not always appropriate, according to Marcel Fujike, vice president
product management and business development in Kuehne + Nagels Global Airfreight division. Were a big user of Envirotainers and other
airline systems but a lot of the time its too expensive, so you look at passive solutions such as thermal blankets. New solutions that can shield
the entire pallet are getting better and cheaper, Fujike says.
Pharmaceutical clients will have their own internal data loggers at piece level, but are increasingly keen to measure the ambient external
temperature. This may put pressure on carriers to maintain fixed temperatures across complete compartments. Most have no clue about how to
warm/cool across all the pallet positions in a 747, Fujike says.
One [all-cargo] carrier carried out tests using up to 50 readers and was getting a range of different temperature readouts in each pallet
position. Most carriers have not done this, so you have no transparency.
The high value of pharmaceutical shipments presents challenges, and Fujike sees it as the forwarders job to raise awareness of potential
problems down the line. The packaging has to be right, and protect the contents from extreme conditions.
Where K+N is offering more services beyond pure airfreight, it can come up with customized solutions, but much depends on the individual
customer, Fujike says. Who is going to be packaging the goods? Is road transport required in an ambient or air-conditioned truck? Are you
throwing away or recycling the packaging? Will refrigeration equipment need to be cleaned?
The weakest part of the chain can be where shipments are sitting on the tarmac waiting to be loaded on the aircraft or transfer the carriers
warehouse. Cool dollies maintain temperatures at airports such as Dubai, but not every facility is so well equipped. Clients, not just forwarders,
have responsibilities in this respect, Fujike emphasizes. It is not unknown for a customer paying the general cargo rate, and supplying goods in a
standard cardboard box, to stipulate on the air waybill: Keep between 2 and 8 degrees. Yet the forwarder may still face a claim afterwards if
something goes wrong.
We always treat 2-8 degree shipments as a specialty. In some locations, we employ front runners people whose job is to be at the aircraft
side when a delicate shipment arrives although you cant do that at every airport, he says.
New question marks surround the tightening US airfreight security regime. Fujike says it will be interesting to see what the authorities accept
18th Edition
as an outer package. Envirotainers are closed and sealed, so do not have to be broken down for inspection. But is a thermal blanket round a
pallet sufficiently tamper-proof to be accepted as a secure unit? He says there are no clear answers so far. Geodis Wilson has identified
pharmaceutical and healthcare as one of eight sectors where it can provide added-value solutions. Martin Svantesson, director of vertical markets
and directly responsible for pharma says the company has been actively marketing a cool chain service with its own dedicated sales and
operational teams to customers such as AstraZeneca, GlaxoSmithKline and Sanofi-aventis since the start of this year.
Svantesson agrees with his competitors that it is not all about refrigeration. The industry in general is moving more goods at ambient
temperature than through the cool chain and it is more challenging to do so, he says. The only malfunction you get in the cool chain is if the
product is packaged wrong or the container loses power. In ambient temperatures, standard packaging may not give you the required solution.
We can do Envirotainers or boxes with gel packs as needed its a question of how the customer wants it done, and is largely driven by the
product, the volume and the particular trade lane. You have to optimize to the individual shipping pattern. Customized boxes can be a better
solution than an Envirotainer or CSafe unit traveling with empty space around the shipment.
Geodis Wilson is hoping to double its pharma business in three years and Svantesson expects most of this growth to come through winning
market share rather than from organic growth in the market. Indeed, airfreight forwarders as a whole may see volume losses as some lower-value
products that were traditionally flown start to go by sea in reefer containers.
He is encouraged by Geodis Wilsons recent successes in
receiving invitations to quote. The company is not just winning new contracts, but also additional business from existing clients (it has had a 20year relationship with AstraZeneca and has helped the client build a global distribution chain). What makes the difference? Were capable and
agile. We will commit people at senior level, which not everyone can do, and were willing to invest to support contracts. This might mean taking
a warehouse to the highest level, far beyond the regulatory requirement, in return for a longer-term guarantee of business.
Svantesson claims innovation is one of his companys strengths. A year ago the company brought to the ambient cargo market its own design
of insulated airfreight container, the G-Box. It is now working on a new version pitched at the +2 to +8 degree market.
K+N in bullish mood as logistics sector bounces back
John Deere, one of the world's leading manufacturers of farm equipment, has recently awarded Kuehne + Nagel a contract for the
management of its national service parts distribution center in Tianjin.
With the objectives of better serving its dealers and optimizing service parts management in China, John Deere has centralized all the aftersales services in a national distribution center in Tianjin. In the past, its three factories located in Tianjin, Jiamusi and Ningbo, producing
different types of agricultural machines, offered after-sales services to the dealers in the country separately.
In the dedicated 5,500sqm facility, Kuehne + Nagel is responsible for the management of around 10,000 SKUs and 170,000 units of John
Deere's products. Kuehne + Nagel's services include inbound transportation from the three factories to the distribution center, inventory
management, domestic distribution to the manufacturer's dealers in China as well as a series of value-added services, such as inbound receiving,
quality control, labelling, pick & pack operations and order processing.
"Kuehne + Nagel has proven itself to be our partner of choice. Not only is it a professional leader in the China logistics market, its solutions
18th Edition
demonstrate a high degree of customer orientation and flexibility," commented Luke Gakstatter, Director of China Operations of John Deere
(China) Investment Co. Ltd. "Based on its efficient set-up, the facility will serve as the regional distribution center for other countries in the AsiaPacific region."
Forwarders boosted by continued consumer spending
Russia has seen financial crises before. Markus Ruulio head of marketing for Kuehne+Nagel there, has been through one of them, in a
previous tour of duty in 1998. So the problems of the last two years have been nothing new. People live one day at a time, so you didnt see the
depression here that maybe you saw in the West. Theyre still consuming fashion goods and cosmetics, Ruulio says.
K+N is focused on fast moving consumer goods, retail, industrial markets (including aerospace and oil & gas) and high-tech, and is
developing in fashion logistics. So in a couple of its target segments, at least, the latest downturn was less painful than it might have been. Clients
in the construction and automotive industries were more heavily affected, Ruulio admits. But that business now seems to be coming back. Oil
and gas business and turnkey projects have developed steadily, and here airfreight plays a major role. Oil and gas clients often need logistics
decisions tailored to specific non-standard demands and the deadlines are tight. Speed is essential from the forwarding agent, especially for spare
parts deliveries, Ruulio says.
One of the first international forwarders to establish a presence in Russia, K+N serves a steadily growing client base, consisting of Russian
enterprises as well as large international corporations. Contract logistics business operates through almost 100,000 sq. meters of warehouse space
in Moscow, St Petersburg and Rostov. The company also has offices in Murmanskand Sakhalinsk for the oil and gas sector, and in Sochi where
it is building up for the next Winter Olympics. Where K+N is not directly present, it has an network of agency airfreight forwarding offices.
Moscow may be well to the west, 10,000 kilometers from Russias Far East, but 85 percent of goods are still imported through there.
Importers and service providers are based at the citys airports and most freighter services call there. Airport infrastructure outside Moscow is
underweight for such a large market and needs more investment, Ruulio says. There are cities of one to two million people that lack adequate
facilities, he says.
Domestic distribution is an issue here, from dairy products right through to spare parts. How do you distribute given the distances and the
severe weather? For clients such as Benetton, we want to go all the way to the shelf without local distributors taking their margin. People who
dont understand the number of large cities in Russia may be surprised, but Benetton has 80 stores here. We need airfreight for this. There is
demand but it needs infrastructure.
Most garments go through a long, complex supply chain to reach those stores. Typically, they will be consolidated in Hong Kong or
Shanghai, shipped to St Petersburg and trucked to Moscow before domestic air services kick in. Benetton sources some items closer to home in
Italy, from where shipments are trucked direct to Moscow. Only for particular fashion ranges, or for retail chains that change their rail every one
to two weeks, will garments fly all the way. The airfreight process will theoretically become more efficient when new Customs rules are
introduced later this year, allowing clearance at the airport for onward shipment. Customs posts in downtown Moscow are moving out to first
points of entry, including land borders with Finland or the Baltic states as well as seaports and airports.
They will have to strengthen the setup at the borders, Ruulio says. The ports should have been ready from March but this has been
postponed to October. The infrastructure and IT is not ready to cope with the volumes. Airfreight is probably ahead of the ports and land
borders right now.
There is more of a tendency these days to import direct into Russia. Security has improved and neighboring countries like Ruulios native
Finland, which once warehoused transit goods in a safer, more traceable environment, play a lesser role now. Yet Customs is not much more
transparent or predictable than before. K+N has its own national Customs clearance license, but it is so crucial to have the correct
documentation and meet the Customs authorities requirements point by point, especially for shipments originating in the US, that it can be wise
to involve local brokers.
Otherwise you can get stuck for weeks or months, Ruulio says. And under-the-counter payments are not an option for multinationals. We
do only white Customs clearance, and local companies are increasingly going this way too.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1994
Asset Focus:
Market Area:
Founding Business:
Brazil
NVOCC
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Enrique Ventura
CEO
Ezequiel Ventura
Artur Regis
Managing Director
Logistics
Ticker Symbol
2 **
Exchange:
12
6
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): MSV/Oracle
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
MSV/Oracle
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Braspine Madeiras
Brazil
Caterpillar
Brazil
DuPont
Chemicals
Brazil
Impsa
Energy
Brazil
Invista
Textiles
Brazil
Kalmar Industries
Industrial Machinery
Brazil
Mendes Jnior
Engineering, Construction
Brazil
Novelis
Metals
Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
Levent
Latin/South America
Brazil
EDITOR'S COMMENTS
Levant is a small, aggressive, modern 3PL involved primarily in project logistics. Project logistics often involves
movement of ship to shore cranes and gas compression units.
Provider's Strengths
Size.
Provider's Weaknesses
Size.
18th Edition
416-626-1178
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1945
Asset Focus:
Market Area:
Founding Business:
International
Customs Brokerage
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Peter Luit
David Zavitz
Chris McMullen
Phil MacDonald
CFO
VP IT
Ticker Symbol
285
62 **
2,200
1976
3-5
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
3
Total Trucks:
Total Trucks:
0.8
Total Other:
10
Total Trailers:
Total Aircraft:
10
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
Proprietary
Insite
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Abbott Laboratories
Pharmaceuticals
BASF
Chemicals
Boeing
Dell
Dow Chemical
Chemicals
Fort Saskatchewan, AB
Eddie Bauer
Apparel
Richmond, VA
Freightliner
Future Shop
Specialty Retailers
Michelin
Motorola
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Burnaby, BC
Garland, TX
Asia/Pacific
Europe
China
North America
Livingston
Latin/South America
Canada
Mexico
United States
EDITOR'S COMMENTS
Livingston International is a leading North American provider of cross-border customs brokerage. It also has
transportation and integrated logistics services. Livingston facilitates the clearance and processing of entries for
more than five million shipments each year, and is the largest customs broker in Canada and the third largest entry
filer in the United States. Livingstons core competency is customs brokerage and its competitive advantage is
customs compliance. Livingston provides good technology with a broad range of web based technology solutions.
In addition, Livingston offers a range of freight, integrated logistics, warehousing and distribution, and international
freight forwarding services.
In 2008, Livingston expanded in air and ocean in the major hubs of Chicago, Los Angeles and New York.
Livingston Internationals former parent company, Livingston International Income Fund, was acquired earlier
this year which resulted in a delisting from the Toronto Stock Exchange.
Provider's Strengths
Canadian import/export 3PL, good niche player.
Provider's Weaknesses
U.S. market penetration could be greater.
TORONTO, Canada Livingston International Inc., former subsidiary of Livingston International Income Fund (TSX: LIV.UN) (
Livingston), CPP Investment Board (CPPIB) and Sterling Partners (Sterling) announced today that the acquisition of assets of Livingston
by a subsidiary of CPPIB and Sterling has been completed.
Livingstons units have been cancelled and will be delisted from the Toronto Stock Exchange today. It is expected that the Depositary for
the transaction will transfer funds today from the acquisition and redemption of units to CDS Clearing and Depository Services Inc., the
registered unitholder, for distribution to beneficial unitholders shortly thereafter on the basis of Cdn$9.50 per unit (subject to applicable
withholding taxes for non-residents).
As previously announced, a portion of the amount received by unitholders will be a Capital Gain Distribution, as defined in the management
information circular dated October 28, 2009 and supplemented with a letter to unitholders dated December 15, 2009 (collectively, the Circular
), and a portion of the Final Redemption Amount, also as defined in the Circular, will constitute income, other than taxable capital gains.
Livingstons current estimate is that the Capital Gain Distribution is not expected to exceed Cdn$1.77 per unit and the portion of the Final
Redemption Amount that will constitute income is not expected to exceed Cdn$0.03 per unit. The exact amount of the Capital Gain
Distribution and the income portion of the Final Redemption Amount will be based on the taxable income and taxable capital gains of
Livingston for fiscal 2010, and each unitholders proportionate share thereof will be set out in T3 tax information slips to be received by
unitholders. As previously announced, unitholders who are not resident in Canada for the purposes of the Income Tax Act (Canada) are subject
to non-resident withholding tax in respect of these amounts.
Livingston also announced today that the amount of the special non-cash distribution made on the outstanding Livingston units to
unitholders of record at the close of business on December 31, 2009, in an aggregate amount equal to Livingstons undistributed net income for
2009, is not expected to exceed Cdn$0.22 per unit. The exact amount of the distribution will be included in the T3 information slips to be
received by unitholders for the 2009 fiscal year. The special non-cash distribution was originally announced by press release on December 23,
2009, at which time the distribution was estimated to be Cdn$0.21 per unit.
Livingston reports results for 2008 fourth quarter and year
TORONTO, Canada Livingston International Income Fund (TSX: LIV.UN), Canadas largest customs broker and a leading North
American provider of customs brokerage, transportation and integrated logistics services, today announced the results for the quarter and year
ended December 31, 2008.
Our key financial measures for the year either exceeded or are comparable to the record levels we achieved in 2007. We are very pleased to
have once again delivered outstanding results for our unitholders, especially given slowing demand and the dramatic fluctuations and drop in the
value of the Canadian dollar, said Peter Luit, president and chief executive officer of Livingston International Inc.
However, we recognize that 2009 will be very different, Luit continued, as the North American economy is showing considerable
weakness. We are prepared for a difficult year ahead, and we have already taken measures to keep expenses down. Specifically, we have accorded
all staff one day off every second week or the equivalent time off on a daily or weekly basis, with a proportionate adjustment in salary; frozen
compensation levels across the organization; and offered an incentive to elicit voluntary resignations from some of our longer-term employees.
These temporary measures will save us money during the period in which they are in place. While we cannot predict with any accuracy when the
economy will rebound, we are confident that it will; and we will be ready for that.
Quarterly results
In the fourth quarter, revenues declined 12.2% to $73.9 million from $84.1 million in the same quarter of 2007. The net loss for the quarter
18th Edition
was $119.8 million compared with a net loss of $24.7 million in the fourth quarter of 2007. There were restructuring costs of approximately $1.9
million in the quarter. The net loss arose from the recognition of impairments of goodwill in our Canadian and U.S. customs brokerage
operations in the amounts of $104.8 million and $38.9 million, respectively.
EBITDA (earnings before interest, taxes, other income or expense, depreciation, amortization and impairment of goodwill, intangibles and
fixed assets)1 decreased to $14.0 million in the quarter compared with $21.1 million in the year-earlier period. As a percentage of revenue,
EBITDA1 decreased to 18.9% from 25.1% a year earlier, as a result of lower volumes in U.S. customs brokerage, transportation and logistics,
and border services.
Annual results
Revenues for the year reached $322.9 million, falling just 0.3% short of the previous years record $323.8 million. The net loss in 2008 was
$88.9 million compared with a net loss of $15.3 million a year earlier, for the same reason mentioned in the quarterly results above.
The Funds EBITDA1 rose in 2008 to $69.7 million compared with $67.7 million in the previous year. The EBITDA1 margin increased 0.7%
to 21.6% of revenue from 20.9% of revenue in 2007.
Highlights
Three months
12 months
(in millions of dollars except
ended Dec. 31
ended Dec. 31
per unit amounts, unaudited)
2008 2007
2008 2007
Net revenues
$73.9 $84.1
$322.9 $323.8
Net loss
(119.8) (24.7)
(88.9) (15.3)
Cash flow from operations
4.1
71.5
45.5 40.5
EBITDA1
14.0
21.1
69.7 67.7
Distributions to unitholders
11.6
11.6
46.4 46.4
Distributions per unit to unitholders*
0.426 0.426
1.704 1.704
* The per-unit calculation is based on the weighted average number of units outstanding.
Livingston International and PBB Global Logistics agree on enhanced offer
TORONTO, Dec. 21 /CNW/ - Livingston International Income Fund and PBB Global Logistics Income Fund today announced they have
reached a negotiated agreement under which PBBs board of trustees unanimously supports an enhanced Livingston offer to acquire all of the
outstanding trust units of PBB.
The enhanced terms of the Livingston offer include an increase in the exchange ratio to one unit of Livingston for each unit of PBB. The
increased exchange ratio currently values the PBB units at $22.45, a premium of 57% or $8.15 above the closing price of the PBB units of $14.30
on the Toronto Stock Exchange on October 18, 2005, the day before Livingston announced its intention to make the offer. Also included in
the enhanced offer is a varied offer alternative, which will allow PBB unitholders to exchange their units for Livingston units while deferring the
realization of any gain or loss for income tax purposes.
In addition, Livingston intends to increase its regular monthly distribution by 10% to $0.142 per unit, commencing with the monthly
distribution expected to be declared on or after March 15, 2006. The increased monthly distribution represents $1.70 per Livingston unit on an
annualized basis.
"Unitholders of both Livingston and PBB can be pleased with the terms of this enhanced offer and that the two funds have agreed to a
transaction that will create a larger, stronger Canadian industry leader," said Peter Luit, president and chief executive officer of Livingston. "A
negotiated acquisition has always been preferred. The agreement to enter into discussions that we announced on December 9 and the
subsequent due diligence have resulted in an offer that is attractive to the unitholders of both funds. It is also clearly a positive development for
the employees and clients of both our operations."
John Brough, chairman of the board of directors of PBB Global Logistics Inc. and chair of the special committee, said: "We are pleased to be
able to unanimously recommend this enhanced offer to our unitholders. Based on the recommendation of our special committee of
independent trustees and directors and the opinions of our independent financial advisors, this transaction is in the best interests of our
unitholders and, we believe, all our stakeholders, including our employees and customers. The terms of the agreed offer provide fair value today
and outstanding potential for the future."
The trustees and certain other senior officers of PBB and its subsidiaries have agreed to irrevocably deposit their units to the enhanced offer.
Following closing, John Brough will join the Livingston board.
As a result of the variation to the Livingston offer, its expiry will be extended to midnight, Toronto time, on January 10, 2006. The offer was
scheduled to expire at midnight (Vancouver time) on December 21, 2005.
The enhanced Livingston offer, will also allow PBB unitholders to elect one of two methods to deposit their units and accept the offer. They
can exchange their PBB units for Livingston units and make an "offer election" through their broker or other nominee. In this case, the
exchange will be treated as a taxable disposition for Canadian income tax purposes. Alternatively, unitholders may elect to deposit their PBB
units to the offer and make a "merger election" through their broker or nominee. In this instance, PBB unitholders would exchange their PBB
units one-for-one for Livingston units on a tax-deferred "rollover" basis and defer the realization of any gain or loss for Canadian income tax
purposes. PBB units tendered to the offer without the unitholder making an election will be treated as if the merger election had been selected.
Full details of the enhanced Livingston offer are included in a Notice of Change, Variation and Extension from Livingston that will be filed
on SEDAR and mailed shortly to PBB unitholders.
The two funds have entered into a support agreement providing for a break fee of $5 million in certain circumstances. The agreement also
requires PBB to waive its unitholder rights plan on January 10, 2006.
18th Edition
55-21-21116657
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1962
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
Brazilian intermodal services provider spun off from former parent - Companhia Vale do Rio Doce.
KEY PERSONNEL
Mauro Oliveira Dias
Roberta Brando
Claudio Loureiro de Souza
CFO
244
26 **
750
Exchange:
Bovespa
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Metals
Ambev
Beverages
Metals
So Paulo
Food Production
So Paulo
BASF
Chemicals
Braskem S.A.
Chemicals
Camargo Corra
Engineering, Construction
Minas Gerais
Cargill
Food Production
So Paulo
Evonik Industries
Chemicals
So Paulo
Exxon Mobil
Petroleum Refining
Vitria
Ford Motor
Vitria
Gerdau Ameristeel
Metals
So Paulo
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Brazil
Asia/Pacific
Europe
North America
Log-In
Latin/South America
Argentina
Brazil
EDITOR'S COMMENTS
Log-In was established and originally named Docenave in 1962 by Companhia Vale do Rio Doce (CVRD).
Docenave was changed to Log-In in 2007 when the assets and employees related to Intermodal Services were
separated from the structure of CVRD. Log-In, with its subsidiaries, provides port handling and door-to-door
container transportation by sea or rail, complemented by short distance road transportation and container storage.
Its customers are in the food/beverage, consumer goods, automotive, industrial and electronics industries.
Log-In currently has 13 offices throughout Brazil and an office in Argentina. It plans to expand its coastal
shipping operations by adding five new vessels by 2013 increasing its coastal shipping capacity by 300%.
Provider's Strengths
Coastal shipping and intermodal.
Provider's Weaknesses
Log-In Logistica Intermodal S. A reported earnings results for the second quarter of 2008. For the quarter, the company posted net profits of
BRL 13.2 million, compared to losses of BRL 7.8 million in the same period last year. Last year's second quarter results were affected by the
company's IPO process which led to extra expenses. Excluding these expenses, the company would have registered a BRL 7.1 million profit.
Net revenues of BRL 99.1 million, up 8.9% over the same period last year. Ebitda was BRL 22.4 million, up 17.9%.
Log-In Secures 20 Year Bauxite Deal; Announces Earnings Results for the First Quarter of 2008; Plans to Add A New Service Between Santos
and Manaus [BusinessWeek, May 9, 2008]
Log-In has won a contract worth $1 billion over the next 20 years to ship bauxite ore for Alunorte in the north of the country. The company
termed the long-term contract the greatest in coastal shipping history. Under the take or pay deal, Log-In will ship 6 million tonnes of the ore
each year between Alunorte's Minerao Rio do Norte mine, close to the Amazon port of Trombetas, and Vila do Conde. Two 80,000 dwt bulk
carriers will be built at a Brazilian shipyard at a cost of $165 million to operate on the route from 2010 onwards, the company said. The
18th Edition
company started construction of the first of five 2,700 teu container vessels at the Rio de Janeiro-based EISA shipyard in March. The company
posted a sharp increase in net income in the first quarter of 2008 to BRL 36.8 million ($21.9 million), compared with BRL 3.4 million in the
previous year, largely the result of BRL 22.8 million tax credits. The company plans to add a new service between Santos and Manaus. The new
Amazonas service linking Santos and Manaus will begin in the second quarter of this year.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1990
Asset Focus:
Market Area:
Founding Business:
Chile
Warehousing
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Fernando Ovalle
General Mgr.
Alex Cantzler
Sebastin Arizta
Eric Lobo
Christin Looff
50
Ticker Symbol
50 **
Exchange:
450
10
5
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
Total Trucks:
10
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
65
Total Reefers:
Total Flatbeds:
Total Trucks:
60
Total Trailers:
Total Aircraft:
75
Total Ocean:
1.07
1
13
Total Other:
10
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Food, Groceries
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
HighJump
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Brother
Chile
Bticino
Chile
Concha y Toro
Beverages
Chile
Corona
Beverages
Chile
Envases CMF S. A.
Packaging, Containers
Chile
Lay's
Chile
Quaker Oats
Chile
Remington
Chile
Ripley
General Merchandisers
Chile
T-Fal
Chile
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Logistica Industrial
Latin/South America
Chile
EDITOR'S COMMENTS
Loginsa's warehouses are locateed in Santiago, Chile. Its core business is in retail, industrial, and spare parts
distribution.
Provider's Strengths
VAWD.
Provider's Weaknesses
Limited service area.
18th Edition
352 719690-1359
COMPANY BACKGROUND
Parent Corporation:
Delton AG
Asset Focus:
Market Area:
Founding Business:
International
Warehousing
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
Major European 3PL with key contract logistics and forwarding divisions.
KEY PERSONNEL
Berndt-Michael Winter
Mara Hancker
Helmut Kaspers
Antonius Wagner
1,547
1,147 **
Exchange:
5,200
100
3
Germany (SDAX)
ASSETS
Total Transportation Assets:
Total Tractors:
700
Total Trucks:
Total Trucks:
600
Total Other:
Total Trailers:
Total Aircraft:
900
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
10.8
1,900
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ABB
Industrial Machinery
Europe
AEG
Europe
Agrolinz
Chemicals
Europe
Alpha Garment
Apparel
Alpha Packaging
Packaging, Containers
Austria
Amgen
Pharmaceuticals
Europe
Applied Materials
Int'l
Arcandor
Specialty Retailers
Europe
Audi
Europe
Autoliv
Europe
Avnet
Europe
Axel Springer
Publishing, Printing
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Bangladesh
Australia
Albania
Canada
Cyprus
Egypt
Cambodia
New Zealand
Austria
Mexico
China
Belarus
United States
Hong Kong
Belgium
Argentina
Brazil
Chile
Colombia
Ecuador
Peru
Uruguay
Venezuela
Iran
Isreal
Australia/New Zealand
Logwin
Botswana
Africa/Middle East
Asia/Pacific
Bosnia-Herzegovina
India
Jordan
Kenya
Kuwait
Indonesia
Madagascar
Malaysia
Mauritius
Maldives
Mozambique
Oman
Myanmar
Bulgaria
Croatia
Japan
Czech Republic
Denmark
Estonia
Finland
Nepal
France
Qatar
Philippines
Germany
Saudi Arabia
Singapore
Great Britain
South Africa
Syria
South Korea
Greece
Sri Lanka
Hungary
Taiwan
Ireland
Thailand
Italy
Pakistan
Uganda
United Arab Emirates
Latvia
Vietnam
Lebanon
Liechtenstein
Lithuania
Luxembourg
Macedonia
Malta
Moldova
Netherlands
Norway
Poland
Portugal
Romania
Russia
Serbia
Slovakia
Slovenia
Spain
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
Logwin, formerly Thiel, is a conglomerate that acquired Birkart, Microlog and other companies. Logwin has
subsidiaries for automotive, fashion/lifestyle/media and furniture.
Logwin now has two business segments: Solutions (contract logistics) which generated 62% of revenue and Air
+ Ocean which generated 38% of revenue in 2009. Over 70% of its revenue is Germany and Austria based. Its
Road + Rail business segment was discontinued in 2009.
Provider's Strengths
Germany-based, European VAWD with capable regional and freight forwarding operations.
Provider's Weaknesses
Limited growth; problems integrating acquired companies.
Logwin is upgrading and expanding its facilities in Shanghai to meet growing demand in China for value added logistics services in the
fashion retail sector.
The company has moved to a 6,000 m2 CFS center in the Lingang district of Shanghai, which is close to the deepwater Yangshan Port, and
has also established a 2,000 m2 logistics facility in Baoshan in the north of Shanghai.
The Baoshan facility will be primarily focused on serving Logwin's fashion retail clients, offering a full range of value added logistics services
such as quality checking, price tagging, sorting, labelling, scanning and pick and pack activities.
Logwin also provides specialist services to customers in the automotive, retail, hi-tech and high end consumer goods and chemicals.
Logwin established its operations in Asia in 1972, and now has 49 offices in China, Hong Kong, Taiwan, Korea, Thailand, Vietnam,
Singapore, India, Bangladesh, Pakistan, Sri Lanka, Philippines, Malaysia, Indonesia, Australia, and New Zealand, as well as representative offices
in Cambodia, Japan, Laos and Myanmar.
Logwin establishes own national subsidiary in Kenya
18th Edition
Grevenmacher (Luxembourg) - The global logistics service provider Logwin has established its own national subsidiary in Kenya. The first
office opened in the Kenyan capital of Nairobi in April this year, with a second office to be established around 500 km away in Mombassa in
June.
"Consequently expanding our network of branches is and will remain a significant cornerstone of our strategy", explains Helmut Kaspers,
COO of the business segment Air + Ocean at Logwin AG. "We are placing increasing importance on local entrepreneurial commitment, as
evidenced by the current establishment of our national subsidiary in Kenya and in India last year."
Logistics from A to Z
Darren Brown is the country director of Logwin Air and Ocean Kenya Ltd. The 40-year-old Brit has extensive experience in the African
logistics market. Brown and his team offer Logwin customers in Kenya a complete one-stop logistics service: In addition to managing air and
ocean freight consignments, the company also specializes in cross-border transportation to the neighboring East African countries, including the
delivery of aid supplies. Project management, supply chain management, warehousing, distribution and customs clearance round off the product
range.
Kenya at the crossroads
With its own offices in Nairobi and Mombassa, Logwin has a presence in two major logistics centers in Kenya. The capital of Nairobi is one
of the most significant economic centers in the country. The majority of Kenya's imports and exports transported by air - around 200,000
tonnes of goods annually - pass through Jomo Kenyatta International Airport. The harbor city of Mombassa, Kenya's second largest city, is the
major hub for Uganda. "A lot is happening in Kenya in terms of logistics infrastructure at the moment", declares Patrick Federle, Managing
Director Region Africa, Logwin business segment Air + Ocean. "For example, current projects include the modernization of the port facilities in
Mombassa and upgrading of the highway to Nairobi. As logistics service provider we profit directly from this." Kenya imports primarily
petroleum and petroleum products, chemicals, white goods, machines and vehicles. Its main exports are tea, coffee, vegetables and fruit, as well
as cut flowers and garments.
Many years' experience
Logwin has had a presence on the African continent since 1976 and operates five offices in South Africa. "Establishing our Kenyan national
subsidiary is the springboard for expanding our activities in Africa", explains Helmut Kaspers. "This market offers great potential and we want
to support our customers on the ground with reliable logistics services."
Logwin in Nairobi:
Logwin Air and Ocean Kenya Limited
1st Floor, Clifton Park, Mombasa Road,
Nairobi, Kenya
Phone: + 254 - 20 - 821619
Fax: + 254 - 20 - 821613
E-Mail: airocean.ke@logwin-logistics.com
Logwin sells Eastern Europe and Austrian land transport activities
Luxembourg-based Logwin and Germany-based Augustin Network have agreed the terms for the sale of Logwin's Eastern European road
and rail activities and general cargo network activities in Austria.
The transaction is subject to cartel clearance by the relevant authorities.
The transaction price has not been disclosed.
The two logistics companies intend to co-operate closely in the future in the form of a preferred partnership, in particular for groupage, LTL
and FTL transportation in Central and Eastern Europe.
The sale is part of the agreed streamlining of land transportation activities within the Logwin Group.
"With the sale of these Road + Rail companies in Austria and Eastern Europe, we are pressing ahead with the announced streamlining of our
land transportation activities as well as increasing our focus on the areas of contract logistics and sea and air freight," said Dr Antonius Wagner,
CFO of Logwin and COO of Road + Rail activities.
According to Berndt-Michael Winter, CEO of Logwin and responsible for the Solutions business segment, Austria and Eastern Europe will
continue to remain core markets for Logwin even after the sale of the land transportation activities, and nothing will change for Solutions and
Air + Ocean customers, who will continue to have access to the Austrian and Eastern European land transportation networks.
Logwin to sell overland transport unit
Logwin is selling the land transportation activities of its subsidiary Logwin Road + Rail Lyon, previously known as TK Logistik, to French
company Dimotrans.
The sale is part of the planned streamlining of the land transportation activities across Luxembourg-based Logwins European subsidiaries.
Logwin Road + Rail Lyon is based at Genas and mainly conducts general cargo transport between France, Germany and Austria, with annual
revenues of around 8m (US$11.5m), and Logwin said that it and Dimotrans are looking for areas of further co-operation.
It added that the sale does not affect the operations of Logwin Road + Rail France located in Scionzier, including the site in Lyon serving
the automotive industry in Lyon.
Logwin strengthens logistics support for BMW
Logwin has increased its support for BMW in Germany with the deployment of its Parts Direct aftermarket service in Berlin and the
surrounding area for the same-day delivery of parts to dealers. It has also enhanced its provision of warehouse and transshipment services in
Hamburg and Cologne for the storage of original parts for the carmaker.
18th Edition
Having now put into full deployment a project initiated last October, Logwin is collecting aftermarket parts from the BMW Dealer Metro
Distribution Center in Berlin and delivering them to 115 BMW dealers in Berlin and the eastern federal states. The company is handling
dispatch, tracking and tracing and loading/unloading.
"Deliveries are affected in a multi-same-day service," said Dr Stephan Freichel, Managing Director Solutions, Sales and Logistics Engineering
at Logwin. "We serve some dealers between two and four times a day. They can call up more than 15,000 different BMW parts numbers on the
same day.
In Hamburg Logwin is now operating 3,000m of logistics and transshipment space for BMW at its PrimeX logistics center in Norderstedt
near Hamburg Airport. Meanwhile, in Cologne-Lvenich, it is operating 3,500 m of warehousing and transshipment space of which 3,000 m
are currently made available to BMW. That site can be increased to 8,000m if required.
Deliveries to dealers and workshops in the assigned delivery regions are made up in order cycles up to four times per day utilizing a fleet of
up to 500 Sprinter vans.
Shipments are put together in a two-step picking process. Small-parts accessories are packed in rotary stackable containers that are then given
a seal. Logwin controls the complete flow of containers and manages the interfaces to the BMW's system.
Logwin falls into loss
Logwin AG (formerly Thiel Logistik) has announced that in the first six months of 2009 it achieved sales of 772.9 million (2008: 1,039.7
million). Earnings before interest and tax (EBIT) before restructuring costs and impairments amounted to -5.3 million and was significantly
below the previous year's figure (2008: 15.4 million).
As a response to the developments of the first half year and the continuing difficult economic situation comprehensive measures aimed at
capacity adjustments and cost cuttings are being implemented. These include cost reductions in all businesses segments, in particular the area of
staff, for example the widespread termination of temporary work, the introduction of short-time work and staff reductions.
Despite the decline in performance as a result of lower sales, net cash flow improved compared to the previous year's figure to -5.4 million
(2008: -7.3 million). At the end of the first half-year the group's cash and cash equivalents remained stable at 53.5 million.
In the first half year 2009 restructuring costs of -6.0 million were incurred in connection with the closing down of the forwarding activities
at the Karlsfeld location near Munich (Germany) at the end of 2009.
"In view of the difficult economic situation, it is of key importance for the Logwin Group that we ensure efficient cost management and
preserve our stable liquidity," stated Berndt-Michael Winter, Chairman of the Executive Committee (CEO) of Logwin AG. "At the same time
we are making Solutions activities more sales-oriented and streamlining our land transportation activities." As already announced in May this
year, the business segment Road + Rail is the subject of a comprehensive review process which also includes a due diligence.
The unchanged weak economic environment and the decline in volumes as a result of the economic situation affected the three business
segments to a similar extent in the reporting period. However, the earnings show differing developments.
In the fist half of 2009, the business segment Solutions achieved sales of 280.0 million (2008: 366.4 million). The business segment was
only able to partly compensate for the sometimes drastic volume declines and achieved EBIT of 0.3 million (2008: 6.9 million). The operating
margin decreased accordingly to 0.1% (2008: 1.9%).
In the reporting period, sales at the business segment Air + Ocean amounted to 200.3 million (2008: 269.0 million). This reduction is
mainly due to the significantly lower air and ocean freight rates. EBIT amounted to 6.9 million (2008: 10.3 million). The business segment was
thus able to maintain its good market position amid the difficult conditions. The operating margin of 3.4% (2008: 3.8%) underlines the success
of air and sea freight activities.
Lower transport volumes and a drastic decline in freight rates put pressure on the business segment Road + Rail. At 319.7 million, sales
were significantly down on the previous year (2008: 432.3 million). In spite of measures aimed at lowering costs and reductions in capacities in
the transportation business, the business segment reported a significantly negative EBIT before restructuring costs and impairments of -9.8
million
(2008: 1.2 million).
The company stated that in view of the unchanged weak overall economic situation, the focus continues to be on measures aimed at stability
in order to safeguard earnings and liquidity over the course of the year.
Logwin realigns business segments
Logwin has decided to realign the activities of its Solutions and Road + Rail business segments in response to the global economic crisis and
its impact on the logistics market.
The aim of the new organization is to align the activities of the Solutions business segment even more closely towards sales, and at the same
time to drastically reduce admin costs.
The Solutions business sales functions will be bundled into a single unit, with customers supported by the tight organization of the
operational processes.
The activities of the Road + Rail business unit will be significantly reduced in order to concentrate on sustainably profitable areas of the
business.
This business unit's disappointing results require resolute actions in order to streamline its activities in land transportation. This will involve
closing businesses and divestments.
Some activities will be integrated into the Solutions business segment in order to benefit from synergies.
Strategic partners will be increasingly sought for cooperation on network activities. Fringe activities with little affinity to the Logwin Group's
other core business will be divested.
The strategic direction of the Air + Ocean business segment remains unchanged.
18th Edition
52 55 5390 4607
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Market Area:
Founding Business:
Asset Focus:
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jos Ignacio Llano
Managing Director
Oscar Lpez
Joaquin Bravo
Irene Guevara
Group Controller
32
Ticker Symbol
32 **
Exchange:
700
50
3
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
1
10
Total Other:
Total Reefers:
Total Flatbeds:
0.95
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
HighJump
18th Edition
Microsoft Dynamics
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Nationwide
Beverages
Nationwide
Representaciones Dicanco
Apparel
Nationwide
Metals
Quertaro, Mexico
Sharp
Nationwide
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Logyx
Latin/South America
Mexico
EDITOR'S COMMENTS
Logyx provides VAWD to the consumer goods, food/bevereage, and retailing industries.
Provider's Strengths
Warehousing.
Provider's Weaknesses
Scope of services.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Iberian Peninsula
Road Haulage
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jos Lus Simes
CEO
Vtor Enes
Jos Melo
Manuel Valentim
82
Ticker Symbol
41 **
Exchange:
559
22
3
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
1,320
Total Other:
Total Reefers:
Total Flatbeds:
2.2
6
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Food, Groceries
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): BaaN-Smart/SID
Transportation Planning and Optimization:
Warehouse Management System (WMS):
BaaN-Smart/SID
GEODE
18th Edition
BaaN Financial
BaaN-Smart/SID
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Iberia
Heineken
Beverages
Spain
Indesit
Portugal
LG
Portugal
MasterFoods
Iberia
Michelin
Iberia
Iberia
Reckitt Benckiser
Portugal
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Luis Simoes
Latin/South America
Portugal
Spain
EDITOR'S COMMENTS
Luis Simoes provides contract logistics and distribution to the Iberian Peninsula. Verticals are food and
beverage 20%, autos 19%, healthcare and pharmaceuticals 12%, paper goods 12%, electronics and high-tech 6%
and other 31%.
Provider's Strengths
Integrated distribution solutions.
Provider's Weaknesses
The Portugal-based Lus Simes group, the country's largest road haulage enterprise, has substantially expanded its logistics centre in Ribarroja
del Tria (Spain). The move is designed to strengthen the company's presence in Spain, as well as to double the volume of goods transported
to/from the Valencia and Murcia regions in Spain. The 7,000 sqm enlarged facility has 12,000 pallet slots. Some 60 of these are already in use in
the first phase of operations, which has just started. Approximately 200 t of goods per day from customers in the region and other parts of the
Iberian Peninsula are processed at the facility. Lus Simes currently operates five other handling centres with an overall area of about 80,000
sqm in Spain. They are located in Barcelona, Bilbao, Madrid, Seville and Valencia. Business in Spain generates nearly 30 of the group's entire
turnover.
18th Edition
64 9 270 7402
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1978
Asset Focus:
Market Area:
Founding Business:
International
Transportation
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Bruce Plested
Carl George
Don Braid
Tim Williams
Kevin Drinkwater
CFO
Group IT Mgr.
719
245 **
Exchange:
3,352
NZ
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
450
Total Other:
Total Reefers:
Total Flatbeds:
1.4
Total Tankers:
Total Other:
MAJOR MARKETS
Food, Groceries
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Mainchain, FreMan
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--MIMS
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Bancroft Wines
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Industry
Beverages
Location
TM
WM
VA
DCC
Inte IM
New Zealand
Asia/Pacific
Australia/New Zealand
Europe
North America
China
Australia
Canada
Hong Kong
New Zealand
United States
Mainfreight
Latin/South America
Taiwan
EDITOR'S COMMENTS
Mainfreight started in New Zealand and then expanded to Australia providing warehousing and distribution. It
continued to grow internationally through a series of acquisions which include: CaroTrans in 1999, Hong Kong
International Freight in 1998 (fully acquired in 2007) and Target Logistic Services (rebranded Mainfreight USA) at
the end of 2007. In July 2008, Mainfreight acquired Halford International an Australian-based freight forwarder.
Today, Mainfreight continues to hold its No. 1 IATA ranking from New Zealand.
Provider's Strengths
The largest provider in New Zealand.
Provider's Weaknesses
New Zealand-based Mainfreight Group has reported that its total revenue (sales) decreased by 10.5% to $1.13bn, from $1.26bn in 2009.
Excluding foreign exchange, this represents a decrease of 10.3%. EBITDA declined 6.7% to $75.85m.
Exceptional items totaled $1.89m; $800k related to leases surplus to requirements and the balance predominantly to restructuring costs
incurred in its Mainfreight USA operations.
Management commented that the past 12 months had been an "exciting and challenging time". Freight volumes deteriorated in most of its
business units. The company's response to this decline was to manage cost structures better, improve margins, aggressively expand market share
by increasing sales activities and continue to improve our quality and levels of service. As the year progressed, performance strengthened quarter
on quarter.
Mainfreight continued to open new branches in China, New Zealand and Australia and "continues to look for new areas where we can
extend our services around the world".
Mainfreight expanding U.S./Canada service
U.S.-Canadian trade logistics company Mainfreight said Monday it is adding equipment and personnel to its nightly service between the U.S.
Northeast and Toronto with continuing service to other major cities in Canada.
The forwarder is adding a "rounder" service with a dedicated truck that originates in Toronto on a Tuesday evening, arriving in Newark-New
York the next morning then returning to Toronto on Thursday morning. Mainfreight also provides overnight service to Toronto from Chicago.
Mainfreight has an exclusive agreement with Sameday Worldwide, a subsidiary of Day & Ross, one of Canada's largest trucking firms, to
provide Canadian domestic service from Toronto to any region in Canada.
Air Cargo Flies a New Heading
The financial impact of the 100 percent cargo screening mandate combined with the other challenges on the horizon are undoubtedly
weighing heavily on the air cargo sector. But surprisingly, some companies are thriving, especially the small- and medium-sized forwarders.
The forwarder who finds a niche and markets it extensively will always be successful because his response times are often better than the
integrators, says Fried. The integrators will always have their place, theres no doubt about it. But what about the shipper who cant fit into the
integrators model? I believe the smaller forwarder is always going to win when it comes to responsiveness, no matter what, because he treasures
his client. For example, when I was a forwarder, I delivered on Christmas Day. If a customer wanted certain packing and palletization, I would
customize my service for them. When it comes to integrators, it's transportation for the masses. But, there are a lot of companies that think
outside the box and they need a forwarder to do that as well."
Jay Bellin, managing director of Mainfreight San Francisco (www.mainfreightsfo.com), formally Target Logistics, couldn't agree more. Not
only does customization play a key role in the company's success, equally important is the focus on customer service, which for many companies
exists more in theory than in practice.
"When we first meet with a potential customer, we go in with a notepad and pencil," says Bellin, "not a presentation." One of the forwarder's
core values is exceeding customer expectations. According to Bellin, the formula is comprised of meeting timing requirements, providing ease of
use and error-free service, and lastly, creating high value for the price that's paid. A willingness to customize a service, remain highly flexible and
execute rapidly goes with the territory.
"We're extremely sensitive to our customers' market conditions and we tailor our services to create a supply chain that provides them with a
competitive advantage," he emphasizes. At the same time, Bellin points out that employee satisfaction is tied into customer satisfaction.
"We built a great Order & Inventory Management system, but it's our highly motivated employees that are driven to direct the tools to
exceed our customers' expectations." Bellin says that the company recognizes the direct link between employee satisfaction and customer
satisfaction and they have built their compensation and financial incentive model precisely on that principle. We use incident reporting and
customer satisfaction surveys, conducted by neutral third-party professionals, to tie-in employee compensation directly to overall customer
satisfaction. In addition to customer satisfaction, our supervisory staff is also compensated on the measurement of employee satisfaction.
18th Edition
As an example of how the company was able to customize a solution for a customer, Bellin explains, One of our customers builds surgical
instruments and they require us to deliver the instruments directly to a waiting team of surgeons. The instrument is then retrieved the next day
and staged in one of our warehouses for the next demonstration surgery. We realized that a simple tracking system was not going to give them a
competitive advantage. Instead, we customized our Web-based interface and gave them a virtual command center management tool, with
complete visibility to hundreds of instruments staged in warehouses across the globe." Furthermore, in an effort to satisfy their distributors,
Mainfreight San Francisco also added an incident management system, which allows their customer's sales representative to document any
positive or negative issue associated with the delivery or transportation of their instrument. The tickets are reviewed to identify trends and feed
into their continuous improvement model.
"Another customer requires delivery of their vending machines to supermarkets and other retail locations. Our drivers deliver the machines
with tools in hand. They mount, install and/or assemble on-site, while every step is documented in our Web-based interface." Once again, they
customized the online tracking system and included a retail store management tab where their customer service personnel and their customer's
planners collaborate online, setting up installs and removals, days, weeks and months ahead of the actual movement.
Although the current market conditions are making it tougher for the air cargo industry in general, those such as Mainfreight San Francisco
who understand the value of providing a personal touch, customized solutions, and rapid response will continue to excel no matter the
challenges.
CaroTrans builds global footprint
When many in the shipping industry had written off non-vessel-operating common carrier CaroTrans International a decade ago, a company
little known to the U.S. freight market stepped up to breathe new life into the organization.
Under the financial wing of New Zealand-based logistics provider Mainfreight Ltd., CaroTrans is now more robust than ever, and is ready to
embark on a global expansion strategy that it believes will put it on par with the giants of the freight consolidation business.
"We have an owner that gives us a sense of identity and a viable future," said Greg Howard, global chief executive officer for Union, N.J.based CaroTrans, in a recent interview. "We've been given the flexibility and resources to independently develop our brand and partner network
around the world."
"The success of CaroTrans in the U.S. market has given us the confidence and the respect that CaroTrans deserves to continue its
development around the world,'' said Don Braid, managing director for Mainfreight.We are excited to be able to commit more resources to
developing our NVOCC services and are committed to the growth that CaroTrans can provide."
CaroTrans was founded in 1979 by Jim Justiss of Carolina Freight Corp., and initially prospered in the U.S./Puerto Rico trade. Howard
joined CaroTrans in 1984 and was charged by Carolina Freight to open the NVO's European and Asian network.
In the mid-1990s, Carolina Freight was purchased by Arkansas Best Corp., a Fort Smith, Ark.-based trucking company. CaroTrans, one of
the most recognized NVO brands at the time, suddenly became Clipper International, a division of Arkansas Best's domestic intermodal service
provider Clipper Group, and nearly slipped into oblivion.
Sensing an opportunity to resurrect the CaroTrans brand, Howard helped negotiate a deal with Arkansas Best to buy Clipper International in
1999. The two investors in the new CaroTrans were Mainfreight and Brussels-based Ziegler Group.
One of the first things the new CaroTrans management team did was cut loose its business with Puerto Rico by selling off this portion of the
network to USF in August 1999. Puerto Rico once represented 40 percent of the NVO's business.
"There were those in the industry that thought we were crazy to divest ourselves of the Puerto Rico business, but it has since proven the best
decision," Howard said. "It allowed us to focus our operations on truly becoming an international NVO service."
However, CaroTrans maintained its neutral consolidator status, meaning that it would continue to provide less-than-container load and fullcontainer load services only to freight forwarders and their affiliated NVOs.
Mainfreight bought Ziegler's shares in 2003. Howard described Mainfreight's ownership of CaroTrans as "completing the circle" in a long
history between the companies.
Bruce Plested and Neil Graham started Mainfreight as a New Zealand trucking operation in 1978, a year before CaroTrans began. According
to a company history, Mainfreight became an agent to Carolina Freight. A meeting between the companies in 1986 at Cherryville, N.C.,
introduced Mainfreight to one of the most sophisticated freight automation systems at the time. Mainfreight took the concepts of the Carolina
Freight system back to New Zealand to build its own.
Since the Mainfreight takeover, CaroTrans has increased its annual U.S. export volumes to more than 50,000 TEUs. The NVO handled an
additional 75,000 TEUs in non-controlled import shipments for overseas agents. Howard noted that CaroTrans' revenue for fiscal year 2007,
ending March 31, will exceed $100 million.
"Our core competency is LCL export, but the mix of business has become more balanced between import and export LCL volumes,"
Howard said. "The growth in exports has recently surged in the FCL market."
CaroTrans operates 12 U.S. offices staffed by more than 170 employees and has plans to further expand its U.S. footprint. The company's
traditional international business had revolved around the transatlantic market. During the past year, the company has opened five branch
offices in Australia and three others in New Zealand, Hong Kong and Shanghai, which has helped expand its presence in the transpacific trades.
Today CaroTrans conducts business in 140 countries with 240 cargo discharge points.
CaroTrans continues to invest in IT development and has initiated electronic data interchange connections throughout its agency network,
forwarder client base and vendors.
"Our current operating system is a proprietary system designed by us and will serve as our global platform as we continue to expand,"
Howard said.
While systems are shared across the company, CaroTrans maintains a decentralized operational structure and prefers to be in the local market
rather than operating backroom service centers in remote locations.
"Targeting growth by instituting our own management, sales force, customer representation and documentation processing on site may cost
us more money in the beginning, but it puts us more firmly in the local market," Howard said. "This also gives us a clearer succession path
within the company and allows us to promote more from within."
Howard, elevated from president to Global CEO in May, will now lead CaroTrans' global expansion, which will include both acquisitions
and new agency partners abroad. Michael Forkenbrock succeeds Howard as president of CaroTrans.
"We'll continue to expand in key markets," Howard said. "We don't want to reinvent the wheel. It's important that we find the right
investment that adds value to our operations and enhances the services to our customers."
Target Logistic Services Changes Name To Global Parent, Mainfreight
Carson On July 1, 2008, Target Logistic Services officially changed its name to Mainfreight, reflecting the title of its new global parent.
18th Edition
The Carson, CA-based freight forwarder and logistics provider was acquired by Mainfreight in November of last year and increasingly is
being integrated into the New Zealand company's worldwide logistics operations.
"The name change tells our thousands of customers and our friends in the logistics industry that under the Mainfreight name the same high
standards of service will apply," stated Chris Coppersmith President & CEO. "Whatever mode of transport; air, ocean or surface, we will
continue to provide swift, reliable transport of our customers' freight."
Coppersmith added that "after operating in the U.S. and abroad for the past thirty eight years as Target Logistic Services, we are proud of our
legacy of dedicated service to our customers." He noted that the freight forwarder opened its doors in 1970 with zero revenues and one office.
"We have grown into a $200 million company with facilities in 38 U.S. cities and a network of subsidiaries and agents in 80 nations."
"In our new role as part of the Mainfreight worldwide team, we now can offer a greater variety of services, combined with competitive rates
that will enable us to become an even stronger presence in global logistics," commented Coppersmith.
He noted that Mainfreight is one of the largest transportation companies in New Zealand with offices throughout Asia and the South Pacific.
The company has some 3,000 employees and $1 billion (NZ) in annual revenues. "We will be offering superior logistics services around the
world," Coppersmith emphasized.
Coppersmith cautioned, however, that air freight and the entire transportation industry faces immediate, formidable challenges. "While the
long term outlook is very positive for the international logistics industry with sustained growth predicted, the current situation poses a number
of serious threats," he continued. "The sky high price of jet fuel, the slowdown in the U.S. and the economies of our trading partners,
overcapacity on many routes and extremely fierce competition combine to make the present air freight environment a difficult one."
Coppersmith is confident, however, that with the dedicated efforts of company personnel aided by the marketing, sales and financial
resources of parent Mainfreight, the U.S.-based division will continue its pattern of sustained, profitable growth. "As part of the Mainfreight
worldwide team, we are in a much stronger position than before the acquisition in November of 2007," Coppersmith concluded.
Mainfreight announces agreement to acquire Halford International
Mainfreight Limited (Mainfreight) today signed a call option deed to acquire all of the shares of Halford International Pty Limited (Halford
International), an Australian-based, privately owned, international freight forwarder and logistics provider.
The call option may be exercised in Mainfreight's sole discretion. Under the terms of the deed, Mainfreight will acquire Halford for
approximately $A21 million. This price is formulated on a six-times multiple of EBITDA earnings at Halford International's financial year end
(30 June 2008). 80% of the purchase price will be paid on completion, with the remaining 20% to be paid over a two-year period.
The acquisition of Halford International provides Mainfreight with an increased presence in the Australian international freight forwarding
sector. Halford International provides freight forwarding, customs clearance activities and logistics services to the market throughout Australia
and New Zealand.
It has six branches within Australia and New Zealand, and a network of international agents throughout the world, including the key trading
nations of Japan, Germany, Asia and the United States of America.
Halford International's sales revenues in the financial year to June 2008 are expected to exceed A$65 million and earnings will be positive.
Mainfreight believes that this transaction will provide it with a strong foundation for further growth in the Australian international freight
market, which is consistent with its strategies expressed to the market over the past 12 months.
"We are impressed by Halford's strong culture and capabilities, and we look forward to welcoming the Halford International team to the
Mainfreight family", said Don Braid, Mainfreight's Group Managing Director.
Pending the completion of certain closing conditions, the transaction is expected to close during July 2008.
Mainfreight announces Target Logistics Inc Acquisition Transaction Completion
Mainfreight Limited (Mainfreight) early this morning (31 October USA date) completed the acquisition transaction of Target Logistics, Inc.
(Target Logistics), a USA and international freight forwarder and logistics provider publicly listed on the American Stock Exchange. Details of
the acquisition are as previously advised on the 18 September 2007.
As a consequence of this acquisition Target Logistics will be de-listed from the American Stock Exchange effective immediately.
This is Mainfreight's second USA acquisition and is another important step in the development of Mainfreight around the world.
As previously advised Target Logistics will be earnings positive and will be consolidated from today into Mainfreight's accounts.
18th Edition
650-378-5484
COMPANY BACKGROUND
Parent Corporation:
Con-way, Inc.
Asset Focus:
A, N
Con-way Truckload
Market Area:
Founding Business:
Con-way Multimodal
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Robert Bianco
President
Robert Bassett
Gary Kowalski
Julie Hui
John Herb
VP Finance
VP Human Resources
1,326
514 **
6,500
200
3-7
Exchange:
NYSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
34
Total Trucks:
55
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
2
18
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--LMS, Infor/CAPS, Oracle--OTM, TR
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--LMS, Infor/CAPS
Infor WM Provia (Menlo modified), SIMS
Infor/CAPS
TMS, Proprietary--LMS
Proprietary--LMS
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3Com
A.O. Smith
US
Netherlands
B&Q
Specialty Retailers
China
Bayer MaterialScience
Chemicals
US
Netherlands
Bobcat
China, Netherlands
Braun GmbH
China
Canon
Caterpillar
IL
CHEP
Packaging, Containers
Netherlands
Cisco Systems
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Latin/South America
Belgium
Canada
Hong Kong
Czech Republic
Mexico
Brazil
Chile
India
Germany
United States
Malaysia
Great Britain
China
Australia/New Zealand
Menlo
Australia
Singapore
Hungary
Ireland
Taiwan
Netherlands
Thailand
EDITOR'S COMMENTS
Menlo is one of the leading U.S. based 3PLs. It is a prime contractor for the U.S. Transportation Commands
Defense Transportation Coordination Initiative. Menlos two Asian acquisitions position it as a major 3PL in China
and Southeast Asia and it has growing European operations. Menlo has adapted a lean six-sigma management
approach that is having positive results both on its profitability and on securing high-margin, high-tech industry
customers. Menlo has solid inbound supply chain management and finished goods distribution capabilities. Its I.T.
capabilities, including its recent addition of Oracle-TMs transportation management system, provide it with solid
supply chain management and optimization capabilities.
Provider's Strengths
Combined and integrated SCM, 4PL and LLP capabilities, significant Asia Pacific presence and expanding global
footprint.
Provider's Weaknesses
Key Personnel:
Gary So Managing Director, North Asia
Jess Goldberg Vice President, North Asia
Bryan Yan Fu Business Development Manager, North Asia
Tom Song Operations Manager, Suzhou China
Zhang Qiang Warehouse Operations Manager
Menlo China Overview
In a recent visit to Shanghai, we had the opportunity to review Menlo Worldwide Logistics' expanding Chinese operations. Menlo Worldwide
Logistics has over 47 years of experience in China. In 1962, it established a Hong Kong office and in 1999 Menlo Worldwide Logistics
established a wholly-owned subsidiary, Shanghai-Menlo Worldwide Logistics (Shanghai) Company Ltd., in the Waigaoqiao Free Trade Zone. In
2006, Menlo formed a wholly owned foreign enterprise (WOFE) allowing it to provide domestic warehousing and transportation services. In
2007, Menlo greatly expanded its domestic mainland Chinese supply chain management network through the acquisition of Shanghai based Chic
Logistics. Chic was a significant domestic Chinese provider of non-asset based transportation management and value-added warehousing
services. In 2009, Menlo rebranded the Menlo/Chic China operations as Menlo Worldwide Logistics, North Asia.
Operated by a staff of 1,400, Menlo North Asia had gross revenue/turnover of over $68 million in 2008 and has developed significant
warehousing and transportation network coverage in mainland China. Its total warehousing network has 2.1 million square feet (197,000 square
meters) of warehouse space and Menlos transportation capacity exceeds 9,100 trucks. Significant warehousing operations have been established
in 12 key cities: Beijing, Chengdu, Guangzhou, Hong Kong, Shanghai, Shenyang, Shenzhen, Suzhou, Tianjin, Urumchi, Wuhan, and Xian. Menlo
s network operations are managed from seven regional branch offices including its centralized transportation management operation collocated
with its Shanghai headquarters. In North Asia, Menlo serves customers in the consumer packaged goods, automotive, industrial, medical
equipment, health & beauty, and high technology vertical industries.
Menlos North Asia warehouse network processes approximately 3,000 to 10,000 customer orders per day. It also provides customers with
solid domestic transportation management capabilities for less than truckload, truckload, domestic air, in-land barge, and rail shipments. In 2008,
Menlo managed in excess of 1,080,000 shipments between approximately 700 cities. In addition to its use of outside carriers, Menlo maintains a
fleet of 50 trucks equipped with GPS (global positioning units) for satellite tracking. Its annual freight under management exceeds $50 million.
The best benchmark of Menlo's value-added warehousing and distribution capabilities in China is its Mary Kay operation. We had a chance
to visit this operation in February 2008 and it has grown considerably since then. In our opinion, it is one of the most sophisticated logistics
operations we have seen in China.
Menlo processes over two million outbound sales orders per year for Mary Kay from its central distribution center in Shanghai, seven
regional distribution centers, and 73 direct sales counter (order pick up point) operations throughout China.
Mary Kay Shanghai Operations
In the Songjiang District of southwest Shanghai, Menlo is running a 23,000 square meter (247,570 square foot) warehouse for Mary Kay
cosmetics. 19,400 square meters of the warehouse is dedicated to a central distribution center (CDC) operation that manages the replenishment
18th Edition
of cosmetics inventories for seven Mary Kay regional distribution centers (RDCs) within China.
The CDC operation receives a daily average of 30 inbound truckloads of Mary Kay product from its manufacturing operation in Hangzhou.
The CDC is staffed with 18 people responsible for replenishing inventories in Mary Kay's seven China RDCs located in Beijing, Chengdu,
Guangzhou, Shanghai, Shenzhen, Wuhan, and Xian. Over 1,000 stock keeping units (SKUs) of product are maintained in on-hand inventory.
Menlo uses a proprietary warehouse management system (WMS) with an EDI interface to Mary Kay's JD Edwards enterprise resource
planning (ERP) system. Menlos WMS is used in conjunction with radio frequency (RF) devices to manage overall work flows. The connected
systems ensure accurate order information flows and inventory levels in the CDC and RDC operations.
The Shanghai RDC operation is collocated in 3,600 square meters of the warehouse and has an approximate staff of 25. Seventy percent of
the thousands of orders it fulfills each day are direct to salesperson residential orders. The remaining orders are delivered overnight to 19
Shanghai area Mary Kay pickup counter operations.
Most of the high-volume RDC order picking is performed by 14 pickers in two main pick modules. An average of over 200,000 order lines of
product are picked each day. Both pick modules are segmented into seven picking zones and stations. Paper orders have incorporated barcodes
which are scanned using RF devices at each station. Specified products are picked from rack positions and placed into cartons on a roller
conveyor. Every individual carton of Mary Kay product has an enclosed RFID (radio frequency identification) tag to identify its contents and
specifications. The RFID tag is also scanned at each station to verify order accuracy during the picking process.
After picking, the orders are packed out and a label is generated for each carton containing shipping and order number information.
All of the outbound transportation from the RDC is managed by Menlo using China Post, a small number of outside carriers, and its own
trucking fleet.
Suzhou Powerwave Dedicated Warehouse
Approximately 50 miles west of Shanghai in Suzhou, China, Menlo runs a dedicated value-added warehousing and distribution operation for
Powerwave Technologies, a wireless communications network solutions company.
The 7,200 square meter (77,500 square foot) Menlo Powerwave Suzhou warehouse began operations January 1, 2008 after a three-month
start up. It is located in a newer warehousing campus and is very modern with three-high storage racking and open shipping and receiving areas.
It is very similar to other Menlo warehouses we have visited in the U.S. and Europe.
The operation has a staff of 21 managing several hundred SKUs of finished goods inventory and wireless communications components.
Warehousing services performed include product receiving, business-to-business order fulfillment, picking, packing and repacking, and overall
inventory management. One-hundred percent of all outbound orders are checked before shipping to ensure order accuracy. The operation also
prepares export documentation as needed for outbound shipments. Powerwave has approximately 20 to 60 outbound shipments per day from
Suzhou.
The Powerwave operations are run using RF devices interfaced with Menlos proprietary SIMS WMS. SIMS in-turn interfaces with
Powerwaves Oracle ERP for order management and visibility.
The operations staff has also been trained using Menlos key lean management principles. This training has paid off; for the four key
performance indicators (KPIs) being tracked for Powerwave, Menlo is currently running at 100% in each. The KPIs include shipping and
inventory accuracy and inbound receiving and outbound order processing metrics.
North Asia Operations Review Summary
Menlo has taken significant steps in becoming a key 3PL in the domestic Chinese market. It is one of the largest players in contract logistics
on the mainland, and the level of sophistication of its operations is closer to those of Western 3PL operations when compared to most of the
manual-intensive Chinese operations we have visited.
By leveraging its local expertise, deploying its lean management principles and solid information systems, engineering, and contract logistics
skills, Menlo Worldwide Logistics has gained a solid footing for future growth in China.
Menlo Worldwide Logistics Extends its Network Transportation Management Reach
http://www.3plogistics.com/Menlo_Aurora_8-2009.htm]
Aurora, IL USA Site Visit
August 27, 2009
Key Personnel:
Bob Bianco, President
Bob Bassett, Vice President of Sales and Marketing
John Beckett, Vice President Aurora Network Logistics Center Operations
Tommy Barnes, Director of Transportation Procurement
Menlo Worldwide Network Logistics Center (NLC) Overview
While we have reported on many Menlo global warehousing operations over the past years, warehouse management is only half of the Menlo
3PL story. With a global transportation management staff of 374 serving 45 customers, Menlo managed approximately 3.3 million international
and domestic transportation shipments in 2008. It is on track to manage $1.2 billion of transportation in 2009 and is targeting to grow its
transportation management business to over $2 billion by the end of 2012.
A large amount of Menlos transportation is managed from its 150 person Network Logistics Center (NLC) operation in Aurora, IL making
the NLC a significant player in domestic transportation network management. Approximately 83% of the transactions the NLC manages are for
outbound shipments and 17% are inbound. Of the NLC transactions, 72% are for domestic shipments and 28% are international. Menlos key
transportation management accounts include more recent customers Bayer MaterialScience, Dana, and the DTCI (Defense Transportation
Coordination Initiative), and long-running Menlo customers Dow, HP, Starbucks, Ricoh, Sears, Electrolux, and Stanley.
Menlos NLC utilizes a straightforward daily transportation management approach. Over 97% of orders are received electronically from
customers via EDI (electronic data interchange), direct data feeds, or through manual order entry into Menlos proprietary supply chain
management system dubbed LMS (Logistics Management System). The orders are then consolidated into shipments and the appropriate
transportation mode is determined based upon shipment size and service requirements. From there, a primary carrier is selected based upon its
cost, service performance, and operating territory. Once all of the orders are planned and the plan is approved by the NLCs staff of
approximately 70 load planners, shipments enter the transportation execution phase and are tendered to the respective carriers.
The LMS handles both domestic transportation modes and international air and ocean shipping. It has multi-currency and measurement unit
capabilities and provides for currency conversion. Secondary service for non-transportation partner fees (storage, customs, etc.) functionality has
18th Edition
also been developed allowing the LMS to provide customers with total cost calculations for transportation and services at an order level.
The LMS also has web applications for order entry, tracking and tracing shipments, event management, rate calculations, and carrier
interfaces for load tendering. Additionally, to help better manage transportation functions, Menlo has developed a number of standard reports in
its LMS.
NLC operations utilize multiple planning boards and numerous quality and productivity measures which are tracked each day and over time.
Menlo is driving Lean management principles throughout its organization and the NLC is no exception. Its customers are each supported
by the Delivery Performance Team. The original concept for the team was developed some years ago by Menlo for HP. It works with customers
and carriers to define a perfect order in the customers terms and manage its transportation processes in light of the definition. Each customers
complete network (inbound and outbound) is analyzed and modeled on an ongoing basis to make process improvements.
Prior to daily transportation management by the NLC, it works with most customers in rationalizing their carrier networks. It uses the web
based EMPTORIS procurement tool to structure single and multi-customer request for proposal (RFP) carrier procurement activities. The tool
s functionality allows Menlo to standardize carrier rate and cost structures, contracts, and develop standard agreed to performance metrics for
its customers. Menlo is currently working with over 530 domestic and international transportation providers and is an active Environmental
Protection Agency SmartWay transport partner.
The customer case studies below are good examples of the NLC/Menlos transportation management capabilities.
DTCI (Defense Transportation Coordination Initiative) Customer Case Study
In 2007, the United States Transportation Command (USTRANSCOM) awarded the Defense Transportation Coordination Initiative (DTCI)
contract to Menlo. Menlo was contracted to develop, deploy, and manage an integrated transportation management program incorporating daily
transportation planning and execution for all Department of Defense (DOD) material shipments moving in and out of continental US DOD
facilities. It was a natural project for the NLC.
The DTCI rollout has been in multiple phases and when completed, the operations will encompass up to 68 DOD sites. The total freight
under management will be approximately $1.6 billion over the contract life. Menlo is currently implementing Phases II & III which will be
concluded in December. Upon completion, it will be managing shipments between 68 DOD sites. Approximately 72% of the shipments
currently being managed by the 37 person DTCI NLC operation are less-than-truckload (LTL), 15% are airfreight, and 13% are truckload (TL)
and specialized TL. To date, Menlo has realized gross savings of over 25% for USTRANSCOM through improved carrier procurement and
carrier management. For example, it has been able to convert many air shipments to lower cost ground transportation providers.
Thus far the NLC is not systematically consolidating LTL to TL, but it will begin mode conversion/optimization operations in 2010 once
Government systems can accommodate complex routing instructions. This should add significant additional savings.
Overall, the NLC operations are performing very well. Menlo has provided USTRANSCOM with on time pickups within eight operational
hours of shipment tenders for over 98% of the shipments it has handled and has made on time deliveries on nearly 96% of the total shipments
in the current period. In addition, small businesses are receiving 50% of the transportation spend through the initiative which greatly exceeds the
contractual target of 23%.
Dana Customer Case Study
Dana is leading supplier of axles, drive shafts, and structural, sealing and thermal-management products to major vehicle and engine
manufacturers in the global automotive, commercial vehicle, and off-highway markets. In 2008, Dana partnered with Menlo to reduce its
logistics costs and improve transportation service levels for its US and Canadian plants.
Menlo deployed a centralized Lean Control Center, leveraging other Tier 1 suppliers. The solution incorporates Menlo logistics specialists colocated with Danas global logistics team in Fort Wayne, IN. Combined, this team exceeded savings and service expectations, which led to the
expansion of the account one year later to include Danas Mexican logistics. The Mexican addition, based on-site at Danas Queretaro, MX
location, along with a leveraged Menlo staff in Guadalajara, MX, supports daily execution of logistics plans engineered via Menlos engineering
resources. Overall, Menlo through a lean foundation and its LMS system has developed a cohesive, information rich, solution for all of Dana
North America.
Summary
With expanding European, Asian, and North American operations, Menlo has advanced to being a true Tier 1 major market supply chain
manager. Its growing domestic NLC operations have been a critical component to its global growth. With its Lean management focus, Menlo
has been able to attract significant new business even in the current recessionary environment. Its Lean approach is making Menlo especially
attractive to high-tech, industrial, automotive and healthcare vertical industry customers.
Menlo Worldwide Logistics Expands its European Market Presence
http://www.3plogistics.com/Menlo_Europe_7-2009.htm]
Eersel and Rotterdam, Netherlands Site Visits
July 10, 2009
Key Personnel:
Bob Bassett, Vice President of Sales and Marketing
Arthur van Gerven, Sr. Director of Business Development, Key Account Management and 4PL Services
Andr de Jong, General Manager - Eersel
Hein van Gastel, Logistics Manager Eersel
Philippe Angeline, Warehouse Manager Rotterdam
Menlo Worldwide Logistics Europe Overview
Menlo Europes 2008 revenues were approximately $80 million and its primary service offering includes both dedicated and multi-client
warehousing and multi-modal transportation management. It has a staff of over 400 operating out of 14 Locations in seven European countries.
The 14 locations include dedicated customer operations in: Germany, Belgium, Hungary, Ireland, and The Netherlands. Its total warehousing
footprint is just over 60,000 square meters (SQM) with seven warehouses. It also manages two transportation management routing centers; one
is in Eersel, Netherlands and one is in Budapest, Hungary. Menlo Europes transportation management services include pan-European ground
18th Edition
truckload, less than truckload (LTL), and last mile delivery services. Its key European customers are: 3Com, AMD, Blue Coat, Bobcat, Diebold,
Lam Research, GE, MAQUET, NCR, New Era, Nike, Nike Golf, Powerwave, and Trimble.
In a recent visit, we had the opportunity to tour one of Menlos main European operations in Eersel, Netherlands and a smaller warehousing
operation in Rotterdam. These are detailed below.
Eersel Multi-Client Warehouse and Transportation Management Routing Center
Menlos Eersel warehouse started as an Emery operation in 1998 for Nike and in 2002 was migrated to Menlo. It is approximately 35,000
square meters and has four separate walled off subdivisions. The ceiling height is 10.6 meters, and Menlo added two 1,400 square meter
mezzanine levels in 2007 in one of the warehouse sections to manage order fulfillment for Nikes online Internet store. Menlo is a global lead
logistics provider (LLP) for Nike Store and Nike Golf.
Today, Menlos Eersel facility in total manages 35,000 SKUs, and processes over 500,000 orders per year for 12 different customers.
Menlo is driving Lean management principles throughout its organization and Europe is no exception. Inbound warehouse receiving and
outbound shipping planning boards are utilized and numerous quality and productivity measures are tracked each day. Its approach is bottom-up
quality improvement focused, and Eersels staff initiated 95 Kaizen (process improvement) events in 2008. The Eersel operation earned Menlos
Silver Lean level (which runs Bronze through Gold) in 2007. It is also ISO 9002 and TAPA certified.
In approximately 3,200 SQM of warehouse subdivision E, Powerwave network computer equipment is stored in racks. The equipment is
received from manufacturing facilities in China and Estonia and Menlo fulfills European business-to-business orders of case and full pallet
quantities. Menlo is using its proprietary SIMS warehouse management system (WMS) with interfaced radio frequency (RF) scanners to manage
inventory and warehouse tasks for Powerwave. It is also managing all outbound ground and parcel transportation and performing some
refurbishment and returns management work.
The remainder of the E warehouse subdivision is occupied by Nike Golf storage racks and a multi station pick/pack line, as well as the Nike
Store (Nike.com) mezzanine operation. Both Nike Golf and Nike Store operations involve thousands of SKUs and order planners use Menlos
Provia WMS to drive cluster picking. Outbound orders are packed and shipped to retailers, consumers and individual stores. The operations
staffing runs from 60 to 120 people (depending on the season) working in single or double shifts, five days per week.
Menlo began working with a Europe based global health care and home care equipment and devices provider in 2007. It manages
approximately 9,000 SKUs of product in 10,000 SQM of warehouse subdivisions A and B. Menlo processes approximately 400 orders per
day destined to hospitals, extended care facilities, and service technicians. The operation has a staff of 50 and almost all of the items and
products are picked and packed prior to shipping. The service scope from Menlo includes returns processing and also value added services.
MAQUET, another Menlo customer in the health care industry, recently expanded its relationship with Menlo awarding it new warehousing
and inbound and outbound transportation management business in Europe for its products manufactured in the United States. The new
business will expand MAQUETs footprint in Eersel from its current 3,800 SQM operation to approximately 4,000 SQM in subdivision B. The
Eersel facility will process over 10,000 outbound orders annually and perform all warehousing activities for some 350 separate products. The
operation for this customer will include warehousing several thousand SKUs of finished goods such as ventilators and cardiovascular monitors
and many lines of spare/service parts. Menlo will continue and grow its existing vendor managed inventory (VMI), kitting, and pick/pack
operations and additionally the work scope will expand to include the transportation management of outbound orders to customers located in
seven European countries.
In a small 3,000 SQM section of warehouse subdivision D, Menlo is performing light assembly work for Trimble. Trimble is a
manufacturer of survey and global positioning equipment. Components used in the assembly are received for short-term storage in nearby racks.
Menlo receives daily work orders for 16 different configurations of two types of survey equipment machines from Trimble. It then assembles
the machines, tests them to ensure they function properly, and packs them into kits with designated parts and accessories. Provia is used to
manage the warehouse and assembly processes and approximately 20 to 40 people are working in the operation in a given day depending on
order demand. Approximately 100 orders are processed each day. Menlo is also performing some returns processing as part of the operation.
The 3,000 SQM 3Com finished product warehousing and distribution operation in subdivision D was the last stop on our warehouse tour.
Menlo receives products including routers, switches, and components such as power cords from 3Com's global suppliers. The inventory is
putaway into rack storage. Approximately 80% of the products and components are VMI stock. As orders are received, product is picked and
packed for shipping. Menlo is processing several thousand orders per year using its SIMS WMS. It is also processing returns and making
software updates to products as value-added services.
The final stop on the Eersel tour was the 10 person transportation management routing center operation. The center is managing panEuropean transportation for most of the warehousing customers. Modes handled include full truckload, LTL, small package, ocean and air.
Rotterdam Multi-Client Warehousing Operations
The Rotterdam warehouse is approximately 8,500 SQM and houses operations for Blue Coat Systems, CHEP and NCR. The facility is ISO
9001 certified, Menlo Lean Silver certified, and TAPA certified. It has an approximate staff of 35.
The first operation we reviewed was for Blue Coat Systems. It develops computer network security and management systems for web
communications and corresponding applications and began working with Menlo this year. The eight person, 250 SQM operation programs
individual network firewall systems from 16 work stations. Once programmed, the units are tested, packaged, and shipped. Several hundred
units are processed and shipped each week.
Menlo processes approximately 15 orders for NCR point of sale (POS) retail equipment units per day. Menlo configures and programs each
machine in a 15 person operation occupying approximately 1,200 SQM.
The rest of the warehouse was dedicated to multiple clients and the Rotterdam CHEP pallet and container hub operation.
Summary
With expanding European, Asian, and North American operations, Menlo has advanced to being a true Tier-One major market supply chain
manager. With its Lean management focus, Menlo has been able to attract significant new business even in the current recessionary
environment. Its Lean approach is making Menlo especially attractive to high-tech and healthcare vertical industry customers.
Menlo Worldwide Prospers in a "Lean" Environment [To view in full html format, follow this link:
http://www.3plogistics.com/Menlo_NSH_3-2009.htm]
Nashville, TN USA Campus Site Visits
March 23, 2009
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Key Personnel:
Gary Kowalski, Chief Operating Officer
Bob Basset, Vice President of Sales and Marketing
Anthony Oliverio, Senior Director of Operations Strategy
Timothy Sroka, Lean Sensei
Jonathan Coller, Facility Manager
Jerome Wanke, Senior Logistics Manager
Overview
With 2008 revenues topping $1.5 billion and a global workforce of over 6,500, Menlo Worldwide Logistics is a leading U.S.-based third-party
logistics provider (3PL). 2007 was a pinnacle year for Menlo. It made acquisitions of Shanghai, China based Chic Logistics and Cougar Logistics
in Singapore to position Menlo as a major Asian-Pacific 3PL. In addition, Menlo was selected as the prime contractor for the U.S.
Transportation Commands Defense Transportation Coordination Initiative. The contract was a major win for Menlo over strong competitors
and is potentially worth $1.6 billion.
Menlo provides customers 3PL and 4PL services, including dedicated and multi-client warehousing; domestic transportation management on
four continents, managed international transportation services; as well as a variety of value-added services including: inventory management,
light assembly, kitting, foreign trade zone (FTZ) services, labeling, manufacturing support, pick/pack operations, packaging, service parts
management, and reverse logistics. Its key customers include: Canon, Cisco Systems, Diebold, Danfoss, Embraer, Ford, General Motors,
Hewlett-Packard, IBM, Navistar International, NCR, Network Appliance, Nike, Nortel, Toyota, and the U.S. Department of Defense.
Menlo has embraced the warehouse campus concept. It has transitioned from a customer-driven dedicated warehouse centric strategy to
more flexible multi-client warehouse operations and now has more than 60% of its value-added warehousing operations in multi-client facilities.
Campuses and multi-client arrangements allow for improved labor management efficiencies.
Menlo Lean Management Process
Menlo has also taken major steps to implement "Lean" management principals across its organization. "Lean" is a methodology that has
grown out of major manufacturing companies and considers the expenditure of resources for any other goal than the creation of value for the
end customer to be wasteful. Wastes are identified using a technique called Value Stream Mapping and once identified, are targeted for
elimination through process improvements (also known as "Kaizen").
Menlo has grown its business using a project-by-project approach. Its overall strategy of standardizing Lean management process
improvement principles across its organization and then deploying the requisite technology needed by each project fits well into this approach. It
is a process driven operating and management style enabled by appropriate IT applications versus an IT driven operating environment. Lean
warehouse standardization is intended to: institutionalize lean principles and techniques at the floor level where the work is performed, engage
and empower hourly staff to make decisions and eliminate waste. It also focuses on increasing training effectiveness, improving productivity and
operational throughput, reducing the total cycle time for new project start ups, and in-turn drives increased customer satisfaction levels.
Each Menlo logistics project starts with an analysis of the current state of operations. Then an improved future state, represented by a Value
Stream Map, is developed as an operational goal. The current state is then analyzed and wasteful activities are eliminated to drive toward the
future state Value Stream Map. Shikumi diagrams and process flow charting techniques are used to model the improvements. Once the
operational processes are optimized, standard work instructions are developed for each individual work process.
As operations are deployed and mature, Menlo staff provide valuable input and feedback driving process improvements. In a Lean operating
environment, Kaizen events are used to target process improvement areas. Menlo separates its Kaizen events into two types. "Process Kaizen"
events focus on rapid process improvements on the logistics execution side to reduce waste and inefficiencies. "Flow Kaizen" events focus on
larger network value-stream process improvements. Examples of Process Kaizen events include: increasing percentages of on-time deliveries,
shortening order to fill lead-times, and reducing required inventory levels in a warehouse. Flow Kaizen event examples include: coordinating
transportation moves between customers to build round-trip truckload moves and expanding the number of warehouse network campus
operations to provide flexible workforces to meet customer needs.
In 2008, Menlo estimates it has saved over $8 million through its Lean improvement activities which are detailed below.
Menlos Lean Results
Kaizen Events
Assoc. Trained
Bronze Certifications
Silver Certifications
Lean Savings
2005
75
80
1
0
$1.59M
2006
216
220
1
0
$2.27M
2007
378
1607
28
4
$5.75M
2008
463
1325
12
9
$8.13M
As process improvements are made, Menlo tracks operational performance through multiple metrics and ongoing customer satisfaction
surveys. Menlo provides individual Lean training to its employees and has implemented Bronze, Silver, Gold, and Platinum certification levels
based upon specific rating criteria for its warehouse operations.
Nashville Warehouse Site Visit
Menlo has been operating in Nashville for over eight years. A primary customer for Menlo is one of the world's largest copier and office
systems manufacturer's, for whom Menlo provides finished goods distribution and transportation management. The first service Menlo
performed for this customer was a modeling exercise designed to optimize its U.S. distribution network. The result of this analysis, which Menlo
then implemented, was to reduce the customer's overall costs and maintain its customer service levels by rationalizing the domestic network to
three distribution centers from eight. After redesigning the network, Menlo began managing all three value-added warehousing operations. Its
daily warehousing and distribution services include inventory management, processing orders for copiers, printers, and associated accessories
and parts, returns processing, and transportation routing.
In its Nashville, TN campus, Menlo operates a 256,000 square foot dedicated warehouse. The operation employs 48 people and runs in two
shifts. Over 14,500 stock keeping units (SKUs) of products, accessories and parts are maintained in on-hand inventory and approximately 665
outbound orders are processed each day. Orders are shipped to over 2,000 end customers. The operation recently received Menlo's Silver Lean
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#3 Menlo Worldwide
WHY THEY WON: Menlo has set out to consistently improve its customers' supply chain performance while driving down total landed
costs. The company has also made strides in the 4PL arena, designing and deploying optimized supply chain networks. Over the past year, we
refined and improved our lean capabilities to help customers drive out waste and inefficiency in their supply chains," says Menlo President Bob
Bianco.
According to IL readers, the San Mateo, Calif.-based 3PL's efforts are paying off. Menlo provides full commitment to our global logistics
needs," says one reader. Another remarks, "They are an industry leader, responsive to their customers, innovative in their approach, and
committed to delivering quality service.
Ed Melching, director of global logistics at Warrenville, Ill.-based truck manufacturer Navistar Inc. agrees. Our business relationship with
Menlo is intensely collaborative," says Melching. "We've greatly benefited from the relationship and today we are invested in a new culture,
management philosophy, and metrics-based approach to defining success and achieving common goals.
CASE STUDY: Navistar
In 2008, Navistar's supply chain operations spanned three siloed business units, creating inefficiencies that did not support its larger business
strategy. Following in-depth research and analysis, the company established and rolled out a five-year plan to fundamentally transform its supply
chain, elevate its logistics capabilities, and reduce overall logistics spend by 25 percent by 2013.
As its lead logistics provider, Menlo Worldwide Logistics served as the change agent Navistar needed, and began working with Navistar
under a unique strategic collaboration model. Today Menlo, Navistar, and its key suppliers have aligned with this vision and strategy, launched
19 projects that have or will yield validated annual cost savings in the millions of dollars, and generated a five-percent reduction in annual
logistics costs.
"With the strategic collaboration model and Menlo's deep expertise in transformative logistics, resources, and best practices, Navistar's supply
chain has become a competitive asset that is continually improving and helping to accelerate our growth strategies," says Melching.
Leading Lingerie Manufacturer Partners with Menlo Worldwide in the UK
Triumph International UK Limited has agreed the transfer of its Swindon located warehouse activities to global logistics operator Menlo
Worldwide Logistics
Swindon, UK and Amsterdam, Netherlands - June 23, 2010 - As part of Triumphs initiative designed to restructure and improve the
competitiveness of its overall UK business, an agreement has been signed with Menlo Worldwide Logistics (Menlo), effective 1st July 2010. The
international logistics operator, part of the diversified freight transport company, Con-way Inc. (NYSE: CNW), will take over warehouse
operations at the lingerie companys Swindon, purpose-built site.
Menlo, which is seeking to grow its business in the region, intends to operate the currently dedicated warehouse as a multi-user facility in the
future. Menlo, which in addition to a full range of warehousing functions, offers transport management services, web fulfillment and 4PL
services, is committed to targeting new customers for the Swindon premises. Situated at the hub of the UKs economically vibrant M4 Corridor
the site provides a strategic location for regional, national and international distribution networks.
The UK is a core market for the global Triumph International lingerie business, which operates in 120 countries, has a history dating back
124 years and is one of the worlds leading underwear producers with brands such as sloggi, HOM and Valisere, in addition to Triumph.
To ensure Triumph UK remains competitive and to support the business plan for growth, the decision to outsource the warehouse operations is
the most viable option for the UK business and its long-standing employees.
Commenting on the agreement with Menlo, Triumph UKs General Manager, Petri Haikola said, Focusing on sales and marketing
operations is the best long-term decision for the UK business and its employees. As such we looked for a trusted and experienced logistics
provider to take over our warehouse business under the Transfer of Undertakings/Protection of Employment (TUPE) regulations. It was vital
to us that our partner would ensure that the 118 warehouse employees would retain their employment and provide job security for the
foreseeable future. We are pleased that in Menlo, we have found just such a partner, with which to work closely.
Tony Gunn, Menlos Managing Director, Europe, welcomed the new partnership with Triumph. At Menlo we are serious in our response to
customer business requirements. Our core values are people oriented and our culture is one of innovation. These assets have helped us in
providing Triumph with an effective solution in Swindon, Gunn noted.
We look forward to leveraging our resources, in-depth logistics experience and knowledge; our commitment to a lean and process-driven
approach, and our reputation for operational excellence in support of Triumphs objectives, added Gunn. In Swindon we see a win-win
situation, a positive solution for Triumph and business growth for Menlo based on delivering consistent performance, service improvement and
waste elimination.
For both parties investment is proof of the commitment they have to the Swindon site and the UK market. Triumphs business initiative also
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includes considerable investment in IT infrastructure and marketing. Its UK operations will be updated with a new IT system facilitating
improved corporate processes across the UK and within the global organization. Additional investments in local sales and marketing activities
will support the Triumph Inspiration Award, an international young designers competition to be hosted in London during September 2010.
For its part Menlo, as a logistics service provider with a global network, investment in the UK and in Europe as whole, provides local and
regional customers with single-source supply chain management expertise and illustrates the companys long-term commitment to best in class,
dedicated and multi-user warehouse and transportation management services, as well as a burgeoning 4PL capability.
Navistar promotes Menlos role to 4PL
US automotive manufacturer Navistar, Inc. has announced it has extended the role of Menlo Worldwide Logistics, LLC, contracting with the
company to provide an expanded range of 4PL analysis, design and management services in support of Navistar's 5-year plan to re-engineer and
improve performance in its supply chain.
In this larger "network manager" role, Menlo will work with Navistar to deploy an advanced "strategic collaboration model" for continuous
supply chain improvement globally. Utilizing this model, the companies are redesigning Navistar's structure, processes and practices for global
logistics, transportation and supply chain management. Navistar's objective is to achieve a 25% reduction in supply chain spend by 2013, while
establishing the team and advanced management skills to drive continuous improvement into Navistar's operations going forward.
Navistar originally selected Menlo in 2008 as its non-North America lead logistics provider. That award marked the launch of a major effort
to identify cost reductions throughout Navistar's global supply chain while improving lead time planning and net landed cost modeling.
"Our goal is to build a world-class logistics capability that drives value and helps us better serve our customers on a continuous basis," noted
Ed Melching, Navistar director of global logistics. "We made great strides in the past 18 months. Probably the biggest is we proved to ourselves,
Navistar and Menlo, that the concept of strategic collaboration really works. Vision, strategy and process all came together. We've formalized the
approach and restructured our team into a blend of Menlo expert resources and Navistar experience. The opportunities to build on these initial
successes are exciting."
Going forward, the Navistar/Menlo team will be implementing additional transformation projects based on its five-year vision and strategic
plan. Specific focus areas will include distribution network analysis and planning, sourcing and contract management, network execution,
invoicing and payment of freight charges, and performance and compliance monitoring. Goals are based on SMART (Specific, Measurable,
Achievable, Relevant, Time-related) targets and measurement against validated key performance indicators.
By embracing its "strategic collaboration model," the Navistar/Menlo team anticipates it will continue to drive results and maintain its
momentum toward achieving their five-year vision in 2013.
18th Edition
81-3-5442-5236
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1937
Asset Focus:
Market Area:
Founding Business:
Global
Motor Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Masanori Kawai
Masaki Izumikawa
Mitsuzo Segawa
15,390
970 **
71,352
200
3
Exchange:
TYO
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
300
Total Trucks:
1,400
Total Trucks:
6,490
Total Other:
1,380
Total Trailers:
Total Aircraft:
2,955
Total Ocean:
27
Total Other:
0
90
40
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Healthcare
Industrial
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Manhattan
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Manhattan, Proprietary--NEWINS
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Canon
Global
Cummins
China
Daimler
China
Ford Motor
Asia Pacific
General Electric
Diversified Financials
Global
Hitachi GST
Global
Honda Motor
Global
Honda Motor
IBM
IBM
Pharmaceuticals
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Global
Global
Australia/New Zealand
Nippon
Europe
North America
Latin/South America
South Africa
China
Australia
Austria
Canada
Hong Kong
New Zealand
Belgium
Mexico
Brazil
Chile
India
Czech Republic
United States
Indonesia
Finland
Africa/Middle East
Asia/Pacific
France
Japan
Germany
Korea
Hungary
Malaysia
Philippines
Singapore
Taiwan
Ireland
Italy
Luxembourg
Netherlands
Thailand
Poland
Vietnam
Portugal
Russia
Spain
Switzerland
Turkey
United Kingdom
EDITOR'S COMMENTS
Nippon Express covers Japan. Its Japans largest domestic transportation company and its Pelican Express
operation is the largest package operation in Japan. Over 87% of Nippon revenues are from domestic Japanese
operations. Its international operations in forwarding and contract logistics are tied to its Japanese base. In
addition to truck-based operations, Nippon provides harbor and ship transportation, air freight forwarding and
warehousing. Its warehousing is tied to its freight forwarding operations. The major question for Nippon is how
much will it grow internationally?
Provider's Strengths
Global reach except for Africa.
Provider's Weaknesses
Developing a neutral international perspective.
Nippon Express has developed a new Black Sea route service to Russia whereby goods will be transported to southern Russia via the Black
Sea. The service is expected to go into full-scale operation in 2010.
The Black Sea route service will allow the company to offload cargo at Russia's Novosibirsk port situated on the northeastern shore of the
Black Sea and transport it by truck to Moscow, Lipetsk and its special economic zone, Kaluga, and cities in the Russian south, reducing lead time
18th Edition
Recession pulls revenue down 3.8 percent, large fine cuts net 58.4 percent
Nippon Express, Japan's largest freight forwarder, said on Friday that it suffered declines in both sales and profit in fiscal 2008, which ended
on March 31.
The Tokyo-based company's group sales totaled about $18.4 billion in fiscal 2008, down 3.8 percent from the previous fiscal year. The
company's group operating, ordinary and net profits all fell sharply in fiscal 2008.
Operating profit tumbled 30.9 percent to $337 million, ordinary profit -- which is similar to pre-tax profit under U.S. accounting standards -plunged 24.9 percent to $423 million, and net profit plummeted 58.4 percent to $153 million.
Nippon Express attributed the poor fiscal 2008 results to the sharp deterioration in the international cargo market that started last autumn
amid the deep global economic downturn, as well as the continued downward trend in the domestic cargo market.
By geographical segment, the Americas brought $571 million in sales, down 5.1 percent, and $23 million in operating profit, down 36.4
percent, to the Nippon Express group in fiscal 2008.
For fiscal 2009, Nippon Express said it projects $15.9 billion in group sales, down 13.6 percent from fiscal 2008. The company also projects
drops in both group operating and ordinary profits.
But the company expects a sharp 40 percent rise in group net profit in fiscal 2009, partly because the one-off factor of an anti-monopoly finerelated extraordinary loss will disappear.
In March, the Japan Fair Trade Commission fined 12 international freight forwarders a total of about $92 million for forming a cartel to raise
air cargo charges. The largest fine was levied on Nippon Express, which was ordered to pay about $24 million.
The company's fiscal 2009 group profit projections are: $315 million in operating profit, down 6.6 percent; $368 million in ordinary profit,
down 12.9 percent; $214 million in net profit, up 40.4 percent.
18th Edition
81 33 238 6638
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Hiroshi Tsutsui
CEO
Sherman Oda
Masahiro Tsutsui
Mits Matsusaka
Taro Ariga
VP Finance, Controller
Division Manager, Planning
1,245
500 **
3,698
100
1-5
Exchange:
TYO
ASSETS
Total Transportation Assets:
Total Tractors:
5,000
Total Trucks:
Total Trucks:
1,000
Total Other:
Total Trailers:
Total Aircraft:
1,000
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
3.3
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
DSA-Foxware
18th Edition
Oracle
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Mitsubishi Motors
Toyota Motor
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
China
Australia/New Zealand
Austria
Canada
Hong Kong
Belgium
Mexico
India
France
United States
Indonesia
Germany
Nissin
Latin/South America
Russia
Japan
Spain
Malaysia
Philippines
United Kingdom
Singapore
Thailand
Vietnam
EDITOR'S COMMENTS
Nissin is a multifaceted Japanese 3PL with significant global freight forwarding operations. It competes with
Kintetsu and Nippon Express.
Provider's Strengths
Automotive logistics.
Provider's Weaknesses
U.S. brand development.
18th Edition
groupe@norbert-dentressangle.com
33-475-031-877
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1979
Asset Focus:
Market Area:
Founding Business:
Europe
Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Franois Bertreau
CEO
Thierry Leduc
Herv Montjotin
Dir. Communications
EVP & Transport Div. Mgr.
Patrick Bataillard
CFO
3,779
3,779 **
Exchange:
26,450
>100
3
EPA
ASSETS
Total Transportation Assets:
Total Tractors:
6,900
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
8,600
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
57
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--Norbert Dentressangle RDT, SHARP
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Paragon
Reflex 400, Infolog, RedPrairie, Proprietary--ULTI
Paragon, Class
SAP
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Agfa-Gevaert
Europe
Arjomari
Europe
ASDA
General Merchandisers
Europe
Auchan
Europe
B&Q
Specialty Retailers
Europe
Beverages
UK
British Airways
Airlines
Europe
Carrefour
Europe
Cosmeticus H&B
UK
Daikin Industries
Manufacturing
Europe
Danone
Europe
Dow Chemical
Chemicals
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
Norbert Dentressangle
Latin/South America
Belgium
Czech Republic
France
Germany
Ireland
Italy
Luxembourg
Netherlands
Poland
Portugal
Romania
Slovakia
Spain
Switzerland
Ukraine
United Kingdom
EDITOR'S COMMENTS
Norbert Dentressangle is a European leader in bulk and temperature-controlled goods. Over 62% or 35.5
million square feet of its warehouse space is frozen storage space.
Norbert consists of two divisions: Logistics which is 45% of its revenue and Transport which is 55%. France is
its largest contributor to revenue at 56.2%, the UK and Ireland are next at 19.6%, then Spain at 11.1%, and other
European countries contribute the rest.
On December 14, 2007, Norbert Dentressangle acquired Christian Salvesen which has broadened its service
offering in the refrigerated and frozen logistics market.
Provider's Strengths
European transportation/distribution.
Provider's Weaknesses
European logistics company, Norbert Dentressangle has made its first significant move into the US freight forwarding market by signing an
agreement to acquire Schneider Logistics' freight forwarding services. The transaction includes air, ocean-forwarding and customs house
brokerage services that operate in seven major US cities and in China (Tianjin and Shanghai) with $29 million of estimated annual revenue and
56 people employed.
Management said that this acquisition will give the company access to the Americas and Asia, two vital regions for international trade, and
significantly accelerate the growth of its freight forwarding business. The acquisition should be completed by the end of October 2010.
The company also revealed that in the first half of 2010, its consolidated revenue totaled 1.4 billion, up 3.9% on a published basis compared
with H1 2009. At constant exchange rates, revenue advanced 3.2%.
Transport revenue rose to 821 million, up 7.3% in the first half and building on the 6.8% growth achieved in Q1 2010. In H1 2010, logistics
revenue amounted to 600 million, down 1.2% compared with H1 2009, but recovering in Q2 to the levels seen in Q2 2009.
Norbert Dentressangle's consolidated operating margin stood at 3.2% in H1 2010, up from 2.1% in H1 2009. Profitability improved in the
transport business thanks to measures undertaken in 2009 and strong momentum in pallet distribution. Transport EBITA margin was 2.5% on a
published basis and 2.1% after adjustment, compared with 1.8% in H1 2009.
Tight management of operations led to a strong rise in logistics profitability. Logistics EBITA margin amounted to 4.3% on a published basis
and 3.7% after adjustment, against 2.4% in H1 2009.
Dentressangle revenues grow in first half
European logistics provider Norbert Dentressangle saw its consolidated revenue grow to 1.4 billion in the first half of 2010, up 3.9% on a
published basis and up 3.2% at constant exchange rates. Transport revenue amounted to 821 million, increasing 7.3% on a published basis and
6.8% at constant exchange rates in the first half, building on growth achieved in Q1 2010.
In H1 2010, logistics revenue amounted to 600 million, down 2.2% at constant exchange rates, compared with a decline of 3.8% in Q1
2010, but matching the revenue level attained in Q2 2009.
Freight forwarding operations, launched at the beginning of the year, grew in accordance with expectations and generated 2 million in
revenue.
Against this backdrop, Norbert Dentressangle continued to improve its profitability in the first two quarters of the year, and management
said that the group will present a healthy balance sheet for the first half of 2010.
Norbert Dentressangle keeps Ultra Ice cool
Norbert Dentressangle has been appointed to provide a frozen storage and distribution service for fast-growing ice manufacturer, Ultra Ice
(UK).
18th Edition
Established in 1984 primarily to serve the airline and event catering sectors, Ultra Ice has grown to become a major provider of ice to the
food, retail and airline industries.
Based close to Gatwick Airport, the company currently produces sixty tonnes of ice a day, and is currently experiencing demand growth of
24% due to the World Cup and recent high temperatures.
To enable Ultra Ice to meet this demand and support the company's continued growth, Norbert Dentressangle makes daily collections from
the company's manufacturing facility and provides storage at its main networked temperature-controlled distribution center at Easton in
Lincolnshire, from where Norbert Dentressangle delivers product into major retailers' distribution networks.
Norbert Dentressangle also provides real-time stock visibility, allowing Ultra Ice to accurately and reliably meet the needs of its major retail
customers.
Hain renews Dentressangles contract for another five years
Hain Frozen Foods UK Ltd has renewed its logistics contract with Norbert Dentressangle for a further five years.
Committed to achieving a greener and more sustainable food chain, in partnership with Norbert Dentressangle, Hain has reviewed its
logistics operations as part of its ongoing commitment to carbon footprint reduction.
Under the new contract, Norbert Dentressangle has introduced double-deck reefer trailers, significantly reducing road miles and CO2
emissions and providing a more efficient, environmentally friendly solution.
Originally appointed by Hain in 2007, Norbert Dentressangle collects frozen ready meals and desserts from Hain's dedicated meat-free
manufacturing facility in Fakenham and provides storage for up to 2,500 pallets at its cold store at Easton, Lincolnshire.
Through its
temperature controlled, shared-user network, Norbert Dentressangle delivers around 400 pallets per week into major multiple retailers'
distribution networks.
The company also stores and delivers raw materials as required for call-off and JIT delivery into Hain's manufacturing facility.
Norbert Dentressangle manages Nettos returns
Netto, part of the Dansk Supermarket Group, has appointed Norbert Dentressangle to establish and operate a centralized returns handling
center for non-food products from its UK stores.
Drawing on best practices developed through the provision of reverse logistics solutions for major retailers including Asda, B&Q, Marks &
Spencer and Tesco, Norbert Dentressangle will operate a central returns management centre for Netto within its shared-user facility in
Birmingham.
Prior to Norbert Dentressangle's appointment, returned product was retained in store or within the retailer's regional distribution centers,
with no defined process for disposal, taking up valuable space and working capital.
Under the new arrangements, returned product is collected from all stores by Netto's delivery vehicles and consolidated at the RDCs for bulk
transportation to the returns handling centre.
Following inspection of product, Norbert Dentressangle's BACTRAC system captures details of returned items and automatically identifies
the most appropriate disposition routes based on a set of user-defined questions, dependent on the value and condition of the product. These
are typically return to vendor, re-sale through the secondary market or, if this is not possible, scrappage in line with the appropriate legislation,
e.g., WEEE.
Where appropriate, Norbert Dentressangle also undertakes product refurbishment in order to maximize recovery value.
In addition to providing real-time, item level visibility of product in the reverse supply chain from point of receipt to final disposal,
BACTRAC provides comprehensive views of historical data and trends, providing Netto with valuable management information.
Norbert Dentressangle has also worked closely with Netto to establish new return to vendor agreements with a number of major suppliers,
significantly improving the recovery value of returned product.
Norbert Dentressangle is also using its established European network of dealers to secure maximum revenue from graded' product, whilst
ensuring that this product is not re-sold in Netto's primary markets.
Norbert Dentressangle wins Beretta deal
Norbert Dentressangle has been appointed to provide a frozen storage and distribution service by leading UK ready meal manufacturer,
Headland Foods.
Established in 1990, Headland Foods Ltd operates two production facilities at Flint in North Wales and Grimsby in North East Lincolnshire
supplying more than two million own-label ready meals per week to major retailers throughout the UK. The company also supplies the in-flight
catering sector.
Through its shared-user, temperature-controlled network, Norbert Dentressangle is providing a daily collection service from Headland
Foods' manufacturing sites, storage within its cold store in Grimsby and onward distribution of product into major multiple retailers'
distribution networks.
Prior to Norbert Dentressangle's appointment, the operation was handled by another third-party provider. The company said that the
transfer was completed with no disruption to Headland Foods' customers.
As a result of the successful implementation of the core business, Norbert Dentressangle is also now handling Headland's specialist aviation
business, serving customers in the in-flight catering sector.
18th Edition
John Picot, Site Director for Headland Foods, said: "The transition to Norbert Dentressangle was easy; the reaction times to obtaining
information regarding our stock is instantaneous, communication is excellent and if we had known it was going to be this good we would have
changed years ago. We also saved some money and I no longer have to get involved in disputes because there aren't any."
18th Edition
3-3542-8877
COMPANY BACKGROUND
Parent Corporation:
NYK Group
Asset Focus:
NYK Bulkship
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Kazuo Ishizuka
Jim Craig
David Proctor
Anthony Chiarello
Donald Meewes
3,417
2,153 **
Exchange:
15,000
500
1-5
TYO
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
25.2
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Paragon, Proprietary
Manhattan--PkMS, Infor/Provia, Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Academy Sports
Specialty Retailers
Adidas
Apparel
AstraZeneca
Pharmaceuticals
Big Lots
Specialty Retailers
Canadian Tire
Canon
Cardinal Health
Casio
Caterpillar
CVS
Dell
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Europe
UK
UK
Europe
North America
Latin/South America
Bangladesh
Australia
Belgium
Canada
Eqypt
Isreal
Brunei
Guam
Bulgaria
Mexico
Cambodia
New Zealand
Czech Republic
United States
China
Saipan
Denmark
Argentina
Brazil
Chile
Columbia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Nicaragua
Panama
Uruguay
Venezuela
Jordan
Kenya
Australia/New Zealand
NYK
Bahrain
Africa/Middle East
Asia/Pacific
Finland
Hong Kong
Kuwait
Madagascar
Mauritius
India
Oman
Japan
Qatar
Korea
South Africa
United Arab Emirates
Macau
France
Germany
Indonesia
Hungary
Italy
Netherlands
Norway
Malaysia
Poland
Myanmar
Portugal
Nepal
Romania
Pakistan
Russia
Philippines
Spain
Singapore
Sweden
Sri Lanka
Turkey
United Kingdom
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
NYK does not have the kind of strong domestic base in Japan that characterizes Nippon and others. It has
aggressively grown international markets and expanded through organic growth and acquisitions. NYK Logistics
started in 2001 by combining purchases and adding transportation and warehouse network to expanding contract
logistics and airfreight operations. Contract logistics and distribution are strong in Europe. In Americas, seven
companies have been combined to create NYK Logistics Americas, with a broad suite of logistics services offered
in North, Central and South America. Automotive, industrial and retail/consumer goods verticals are emphasized.
Its automotive logistics includes roll-on/roll-off, JIT and parts distribution. Sister company, Yusen Air & Sea, is a
major airfreight operation, particularly within Asia and recently set up a strategic agreement with Panalpina. Nippon
Cargo Air is now an NYK owned entity and NYK Logistics Americas has its own airfreight forwarding capability.
Revenues shown include Yusen. NYK Logistics and Yusen Air & Sea are slated to be merged into one company,
Yusen Logistics Co., Ltd., in 2011.
U.S. Headquarters Contact Information:
NYK Logistics
2417 E. Carson St., Ste. 210
Long Beach, CA 90810
Phone: +1-310-518-0206
Fax: +1-310-518-9443
Email: jim.craig@na.nyklogistics.com
Provider's Strengths
Breadth of parent company offerings, willingness to change and grow.
Provider's Weaknesses
Summary
NYK Group and its 3PL operations perform many sophisticated services supporting global trade and supply chain management. It is one of
a select group of 3PLs that have this level of global supply chain management expertise. The combination of NYK Logistics and Yusen Air &
Sea into Yusen Logistics is a logical step in streamlining and synchronizing its operations to provide a single market face to customers. The
integrated company will be one of a handful of global 3PLs with the ability to handle shipments from origin to final destination completely
within its own network. We anticipate that this strategy will be a significant step in driving the 3PL operations continued growth.
NYK enhances inland transportation service in China for finished cars
NYK Logistics (China) has ordered 100 car trailers to meet the inland transportation needs of China's car market - which is now the largest in
the world.
After this procurement, the company will have 700 car trailers at its disposal, and will rank among the leading foreign-capitalized companies
providing finished car transport services.
The NYK Group has been transporting finished cars overland in China since 2003, and now provides transportation services throughout the
country to Chinese, European, and Japanese vehicle manufacturers that produce cars domestically.
Domestic sales of new cars in China now exceeds thirteen million units, and the resulting demand for inland transportation is expected to
increase in tandem with increasing imports and exports.
NYK Logistics (China) established its head office in Shanghai in June 2000 - the first comprehensive logistics company wholly owned by a
Japanese company. Since then, the company has set up branches in cities along the seacoast as well as the inner regions of China, and intends to
further expand its logistics service network.
Evenflo appoints NYK Logistics
Evenflo has appointed NYK Logistics as its logistics service provider to help develop its business in Europe, the Middle East, Africa and
India.
NYK Logistics' warehouse in Antwerp has functioned as the European Distribution Centre for Evenflo since March 2010.
Evenflo's baby care products and equipment are stored in the Good Distribution Practice (GDP) licensed area of the warehouse and is
handled by specially trained employees.
Throughout this initial phase of the operation, NYK is handling fifty orders and receiving two containers each month. At the same time,
approximately 100 pallets will be stored in the EDC.
The Antwerp facility is a bonded warehouse with a customs department that can handle all associated formalities relating to Evenflo's
operational activities. Other administrative formalities, such as VAT settlement, are also managed by NYK.
Nippon Yusen Kabushiki Kaisha (NYK) and Yusen Air & Sea (YAS) have signed a letter of intent covering the integration of the two
companies' logistics businesses [Supply Chain Asia, March 7, 2010]
Effective on or around October 1st, 2010, NYK Logistics (Japan) will be integrated into YAS through an absorption-type de-merger or
business transfer with cash consideration. On completion of the integration, YAS will change its trade name to Yusen Logistics Kabushiki
Kaisha (English name: Yusen Logistics Co), and the newly integrated company will remain a listed subsidiary of NYK. The two companies'
logistics businesses outside Japan will be integrated gradually between April 2011 and March 2012, basically through the establishment of joint
ventures.
NYK merges logistics divisions
In his New Years Speech to the company on Monday, NYKs president Yasumi Kudo said that the company needed to merge its contract
logistics business, NYK Logistics, with its airfreight forwarding business, Yusen Air & Sea Service, to establish a structure capable of fully
serving all logistics needs of customers.
But he added that the merger will not prove effective until the company fosters logistics professionals fully versed in all aspects of ocean/air
freight forwarding and contract logistics on a worldwide basis.
This year we are keeping up a vigorous exchange of personnel among our liner trade division, NYK Logistics and Yusen Air & Service in
Japan which began last summer, a spokesman told Automotive Logistics News. The personnel exchange in overseas has not begun yet.
Kudo outlined that the company was still pursuing its Yosoro Project in response to the economic crisis that saw export shipments of new
cars from Japan almost halved in 2009 on the previous year, far exceeding the earlier projected downturn.
Yosoro, which means Steady Ahead, has led to the scrapping of surplus vessels, including car carriers, as well as aircraft, warehouses and
trucks. Car carrier vessels were down from 130 vessels to approximately 90 vessels at the end of 2009, as predicted in February 2009 by
Mikitoshi Kai, head of investor relations at NYK.
This scrappage will continue in 2010. Those car carriers still operating, like the companys container vessels, which saw a fall in volumes
shipped of around 15%, continue to slow steam along their trade routes.
Further slimming down strategies are due for the new year according to Kudo. We must redouble these efforts to slim down surpluses and
achieve the restoration of profits by all means during the second half of the current fiscal year, he said.
With regard to the impact on automotive customers, an NYK spokesperson said that the merger of the NYK Logistics and Yusen Air & Sea
Service will allow the company to better serve the logistics needs of its customers in ocean/air freight forwarding and contract logistics at one
stop.
The benefit is not limited to ocean freight. For the automotive sector, we offer the PDI operation, terminal business and milk run as well as
cross dock, he said.
The companys outline for structural reform includes the strengthening of vehicle transport by sea through the establishment of a more
flexible fleet mixture that can accommodate fluctuations in cargo volumes and changes in fleet planning policies. It is also aiming to enhance its
ability to meet export demand from China and India.
NYK wins contract extension from Volkswagen Logistics
18th Edition
Following a competitive tender, NYK has been awarded a contract extension by Volkswagen Logistics to provide inbound logistics services
for the delivery of components into Bentley Motors' manufacturing facility in Crewe.
The operation supports production of the existing Bentley range, comprising the Arnage, Azure, Brooklands, Continental Flying Spur,
Continental GT and Continental GTC models.
NYK Logistics is responsible for the delivery of around 6,000 different parts into the Crewe plant from 150 UK-based suppliers and 460
suppliers throughout Europe.
Supported by the provision of integrated reverse logistics planning, NYK is responsible for the outbound movement and management of
returnable packaging on a pan-European basis.
The contract will continue to be served by NYK's existing UK and European automotive network. Bentley parts are cross-docked at NYK
hubs in Germany and the UK before onward delivery direct into the plant at Crewe by a dedicated fleet of shuttles.
Paul Demet, Deputy Chief Executive for NYK Logistics (UK) Ltd said: "This is great news and was achieved fundamentally as a result of the
quality of service we have provided to Bentley over the last few years.
"Our success was achieved against strong competition from other providers and reflects the hard work and commitment shown by both the
Bentley and NYK teams in working together to make this happen. We look toward a long term and successful future with Bentley."
NYK night shift means next day delivery for Kia
NYK Logistics has integrated spare parts deliveries for 90 Kia dealerships in Belgium and Luxembourg through its cross dock centre in the
Belgian municipality of Sint-Katelijne-Waver.
The move is part of a multi-year contract between the two companies with an annual value of 250,000.
Distribution from the centre is taking place overnight, with ordered parts delivered to the cross dock in the evening from the Mobis logistics
coordination centre 70km away in the Flanders town of Lummen. Based on dealer location, the parts are then sorted for milk-run delivery to the
dealerships before the following morning. The cross dock is fully operational between 16:00 and 02:00 hours.
Kia Belgium was looking for a service and quality upgrade and selected NYK for the deliveries of after sales parts to their dealers, NYK
Logistics Belgiums Senior Manager for Business Unit Night Distribution, Eric Derbaix, told Automotive Logistics.
NYK has an established night distribution network for spare parts delivery to car dealers and repair shops in the Benelux region and France.
The premium service includes full scanning and track & trace.
The 4,000m2 Sint-Katelijne-Waver cross dock was set up in December 2006 when operations moved from nearby Mechelen. It has 26
loading docks and is one of five locations NYK Logistics runs in Belgium. Besides being the central hub for the night distribution network in
Belgium, where the sorting and loading of the distribution trucks takes place, it is also the central office for the management and customer
service for the networks in Belgium, Netherlands and France, said Derbaix.
As well as the automotive spare parts distribution in the region, NYK Logistics offers supplier pick up services and logistics including
storage. At the ports of Antwerp and Zeebrugge, NYK RoRo and ICO (a NYK group company) offer a wide range of PDI and terminal
operations, as well as shipping.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Mexico
Warehousing
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Ing. Ruben Iman Trevio
CEO
Andriana Antnez
Lic. Aldo Lopez Torres
Financial Director
36
Ticker Symbol
36 **
Exchange:
1,268
39
3
ASSETS
Total Transportation Assets:
Total Tractors:
708
Total Trucks:
Total Trucks:
593
Total Other:
Total Trailers:
Total Aircraft:
679
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
1.97
60
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): EZIPO
Transportation Planning and Optimization:
Warehouse Management System (WMS):
EZIPO - LANZA
SICA
18th Edition
EZIPO
SICA
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Azcue
Furniture
Mexico D.F.
Mexico D.F.
Districomex
General Merchandisers
Mexico D.F.
Dobos
Mexico D.F.
Editorial Planeta
Publishing, Printing
Mexico D.F.
Liverpool
General Merchandisers
Mexico D.F.
Mexico D.F.
Puma
Apparel
Mexico D.F.
Siglo Xxi
Apparel
Mexico D.F.
Thomson Technology
Mexico D.F.
Tommy Hilfiger
Apparel
Mexico D.F.
URMAN
Specialty Retailers
Mexico D.F.
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Onest
Latin/South America
Mexico
EDITOR'S COMMENTS
Onest's warehouses are strategically located in 21 cities throughout Mexico from Tijuana to Cancun.
Provider's Strengths
VAWD.
Provider's Weaknesses
Size and scope.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Ocean Shipping
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Allen Wong
CEO
Frankie Lau
Bosco Louie
CFO
CIO & Director
483
50 **
850
Exchange:
HKEX
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
2.2
Total Tankers:
Total Other:
MAJOR MARKETS
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Belkin
Computer Peripherals
US
Hobby Lobby
Specialty Retailers
US
Michaels Stores
Specialty Retailers
Asia, US
USG
CA
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Belgium
Canada
Cambodia
Denmark
United States
China
Finland
Hong Kong
France
Egypt
Bangladesh
Isreal
United Arab Emirates
Australia/New Zealand
Australia
OOCL
Latin/South America
Germany
India
Netherlands
Indonesia
Sweden
Japan
Turkey
Korea
United Kingdom
Macau
Malaysia
Myanmar
Napal
Pakistan
Philippines
Singapore
Sri Lanka
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
OOCL Logistics was founded 30 years ago under the name of Cargo System. It is the logistics piece of Orient
Overseas Container Line (OOCL). OOCL generated revenues of $4.3 billion in 2009.
Provider's Strengths
Provider's Weaknesses
Orient Overseas (International) Ltd., Hong Kongs biggest container line, returned to profit in the first half after a $1 billion gain from selling
property and a rebound in shipping demand.
Net income of $1.28 billion compared with a restated loss of $231.8 million a year earlier, the company said in a statement today. Hanjin
Shipping Co., South Koreas largest liner, posted a 174.1 billion won ($149 million) profit in the second quarter as it charged more to move
cargo.
Orient Overseass container-shipping sales rose 39 percent as it carried more clothes, toys and furniture to the U.S. and almost doubled rates
on Asia-Europe routes. Shipping volumes are rising after a trade slump during the global recession caused industrywide losses of more than $15
billion last year.
Profitability is improving with better rates, said Geoffrey Cheng, an analyst at Daiwa Institute of Research in Hong Kong. Export orders
to the U.S. have been increasing, and this can help sustain demand for the rest of the year.
In January, Orient Overseas agreed to sell its Chinese property assets to CapitaLand Ltd., Southeast Asias biggest developer, for $2.2 billion.
Orient Overseas posted an operating profit of $309.9 million rebounding from a year-earlier loss of $191.7 million. Sales jumped 32 percent
to $2.7 billion. Hanjins operating profit was 169.7 billion won and sales at 2.37 trillion won.
Orient Overseass container-shipping revenue rose to $2.5 billion from $1.8 billion. Asia-Europe sales more than doubled to $603.6 million.
Transpacific revenue increased 19 percent with average revenue per box rising 14 percent.
Special Dividends
Orient Overseas line proposed dividends of 51.5 cents a share, including the interim dividend and a special payout following the China
property sale.
Shares of the company, controlled by the family of former Hong Kong Chief Executive Tung Chee-hwa, rose 1.5 percent to close at
HK$63.65. The stock has risen 75 percent this year, compared with a 1.5 percent drop for the benchmark Hang Seng Index. Hanjin fell 1.2
percent to close at 33,500 won in Seoul.
Orient Overseas is giving preliminary consideration to a number of possible acquisitions, focusing on opportunities to significantly grow
the container transportation business, Chief Finance Officer Ken Cambie told reporters in Hong Kong.
Further Opportunities
Further opportunities may arise over the next six to 12 months, Cambie said today. The company will expand the terminal and logistics
businesses organically, he said.
Orient Overseas had avoided a container squeeze that plagued some companies in the first-half, and has adequate cargo-boxes to meet its
requirement, Cambie said.
The shipping line carried 2.2 million twenty-foot containers in the first half, a 12 percent increase from a year earlier. Volumes on transpacific
routes, the companys biggest market, rose 4.4 percent, while Asia-Europe traffic increased 11 percent.
18th Edition
High utilization rates are indicating strong near-term performance and seasonal demand, Teddy Tsai and Quek Shuwei, analysts at DnB
NOR ASA, wrote in an Aug. 2 note. Most companies are expecting profitability and improving cash-flows going into the third-quarter.
Hanjin moved 953,917 boxes in the second quarter, 24 percent more than a year earlier, the company said in a statement today. Operating
profit from its container business reached 149.8 billion won, compared with a loss of 8.7 billion won in the previous three-month period.
Container volume is expected to increase as we enter into the peak season but we are also concerned about the excess capacity expected
with deliveries of new large vessels, Hanjin said in an e-mailed statement today.
OOCL Logistics launches Payment Audit
With the third in a series of innovative product launches, OOCL Logistics has demonstrated its leadership in information technology and
innovative solutions with the launch of Payment Audit, a unique product package offered to OOCL Logistics customers.
Payment Audit allows OOCL Logistics customers to save time and resources, is easy to use, and gives total visibility when checking the
validity of their carrier bill.
With Payment Audit, customers pay only for the transportation services they have received, in compliance with their freight contract. They
can check details on every field audited, said Allan Wong, CEO of OOCL Logistics. This unique product will also tell customers what has
been validated and how it has been done, and is fully customized to their needs.
Key features of Payment Audit include:
Customizable audit policy setting on audit items
Zoom into the audit result to illustrate every un-matched charge item
Visibility in the entire process, from invoice receipt, audit, discrepancy resolution, to payment
Measurement of your carriers invoicing quality
Invoice image, data storage and retrieval
Supports payment audit for shipments managed by logistics providers other than OOCL Logistics
Mr. Wong explained that OOCL Logistics Payment Audit offers customers unique benefits, including:
Full visibility in the audit process
Zero capital investment
Saved costs incurred by errors and duplications
Increased accuracy
Allows pre-audit and post audit functions
With rates set up in the Payment Audit system, you can repeatedly audit many invoices. Accuracy of auditing is higher, faster and more
systematic than the manual process of your accountant, said Mr. Wong. OOCL Logistics customers can get the big picture with details
about which charge item has gone wrong, with an accurate calculated amount and explanation. They can also determine what kind of data
should be verified and audited. With zero capital investment, our customers can enjoy full visibility in the audit process.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Asset Focus:
Market Area:
Founding Business:
Asia Pacific
Third-party Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Gilbert W. K. Lau
Managing Director
Margaret Lau
Udo H. G. Willhoft
Executive Director
GM
22
Ticker Symbol
22 **
Exchange:
350
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
50
Total Other:
Total Reefers:
Total Flatbeds:
0.6
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Oracle
Oracle
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Adidas
Apparel
Hong Kong
Avon
Hong Kong
Bridgestone
Hong Kong
Carrier Corp.
Hong Kong
Ciba
Chemicals
Hong Kong
Exxon Mobil
Petroleum Refining
Hong Kong
General Electric
Diversified Financials
Hong Kong
Hong Kong
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
Oriental Logistics
Latin/South America
China
EDITOR'S COMMENTS
Small Hong Kong-based 3PL with a chemicals, hazmat specialization; charismatic owner.
Provider's Strengths
Close-knit employees.
Provider's Weaknesses
Small operator in toughening market.
Large or small, each customer gets individualized service. Oriental shies away from large customers due to the risk factor present if they
terminate a contract and a large part of their warehouse is suddenly vacated. Mr. Lau has emphasized steady but small growth for Oriental and
has developed relationships with Hoyer, G&U Logistics, Anker Leschaco Logistics of Germany, and a partnership in Hamburg, Germany.
HSBC Mega Hong Kong Sale
The HSBC Mega Hong Kong Sale is one of the five major events of City of Live: Hong Kong is it. Oriental Logistics, which provides
professional logistics services, is the Official Logistics Company of this event.
Background
The Mega HK Sales (MHKS) held from 15th June 2002 to 31st August 2002 was the 4th major tourism campaign in the City of Life: HK Is
It! Program. Organized by HK Tourist Board (HKTB), this is the largest ever shopping festival in HK. Oriental Logistics (OLL) as a sponsor
and key supporter of the event provided logistics and delivery services on MHKS publicity material for participating merchants.
Challenge
As OLL is the sole logistics service provider for the MHKS, we took a critical role to handle every single order in a timely manner in order to
streamline the promotion activities during the program.
Firstly, OLL had to meet a tight delivery and collection schedule. Since the participating merchants and designated kiosk locations were
scattered over the territory, OLL had to deliver publicity materials to around 1,400 delivery points within 3 days and to transport the collaterals
for the set up of the kiosks before the launch of the program.
Moreover, during the program, OLL had to deliver the give-away items and collaterals regularly and supported the replenishment of
necessary materials to the designated kiosks under a tight time schedule. OLL also collected the daily lucky draw coupons at the 40 designated
kiosk locations dispersed over the territory to the Headquarters of HKTB before 10:00 am each morning.
In addition to the rigid time constraint, repacking of 1,400 kits of publicity material was another challenge to OLL. As each location require
different amount of publicity material, OLL needed to repack and distribute the publicity material correctly according to the requirement of each
location and ensured that the publicity materials reached the right destination timely.
How we meet the challenge
Building on our global experience and industry expertise, OLL provided an innovative logistics solution to the complex distribution
requirements. Supported by our fleet of vehicles, our dedicated logistic and delivery system provided efficient and timely delivery services over
the complex distribution points.
We also allocated a team of experienced and competent staff to operate the service and emphasis the important of time management.
Result
With the business relationship with HKTB for more than 4 years, OLL understood the requirements of HKTB and provided a successful
logistic and delivery services for the program.
18th Edition
info@panalpina.com
41 61 226 11 01
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1935
Asset Focus:
Market Area:
Founding Business:
Global
Freight Forwarding
Pantainer AG
Panalpina Air & Ocean AG
Panalpina, Inc.
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Monika Ribar
Group CEO
Lucas Kuehner
Markus Wegmann
Hans Moller
Armin Heinlein
5,481
1,267 **
Exchange:
13,500
>100
7-10
SWX
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
22.3
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Armani
Apparel
Bally
Specialty Retailers
Bombardier
Germany, India
Cargill
Food Production
Brazil
Celestica
Chanel
Apparel
Chevron
Petroleum Refining
Delphi
Apparel
Eastman Kodak
Singapore
Ericsson
UAE
Gucci
General Merchandisers
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
US
Europe
North America
Latin/South America
Afghanistan
Australia
Albania
Canada
Angola
Bahrain
Azerbaijan
Guam
Austria
Mexico
Bangladesh
New Caledonia
Belgium
United States
Cambodia
New Zealand
Boznia-Herzegovina
China
Saipan
Bulgaria
Argentina
Aruba
Barbados
Bolivia
Brazil
Chile
Colombia
Costa Rica
Cuba
Dominican Republic
Ecuador
El Salvador
Guatemala
Guyana
Haiti
Honduras
Jamaica
Netherlands Antilles
Nicaragua
Panama
Paraguay
Peru
Puerto Rico
Suriname
Trinidad and Tobago
Uruguay
Venezuela
Cameroon
Congo
Cyprus
Australia/New Zealand
Panalpina
Algeria
Africa/Middle East
Asia/Pacific
Croatia
Egypt
Equatorial Guinea
Georgia
Ethiopia
Indonesia
Gabon
Japan
Ghana
Iraq
Kazakhstan
Czech Republic
India
Denmark
Estonia
Finland
France
Korea
Germany
Jordan
Kyrgyzstan
Greece
Kenya
Lebanon
Hungary
Kuwait
Libya
Malaysia
Iceland
Maldives
Ireland
Myanmar
Italy
Nepal
Latvia
Israel
Madagascar
Malawi
Mauritius
Lithuania
Morocco
Mozambique
Pakistan
Oman
Singapore
Qatar
Sri Lanka
Rwanda
Saudi Arabia
Taiwan
South Africa
Philippines
Luxembourg
Macedonia
Malta
Netherlands
Norway
Thailand
Poland
Sudan
Turkmenistan
Portugal
Syria
Vietnam
Romania
Tanzania
Tunisia
Russia
Serbia and Montenegro
Uganda
Slovakia
Slovenia
Yemen
Spain
Zambia
Zimbabwe
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
Panalpina is a Top 10 freight forwarder. It is the third largest in air freight and fourth largest in ocean freight. It
handles more than 1.1 million TEUs per year, more than 700,000 tonnes of airfreight and about 1 million tons of
non-containerized break bulk cargo. It has 242 sub-contracted warehouses in 150 countries and is consistently
profitable.
The life blood of Panalpina is its ongoing financial stability and transparency. Its gross profit runs greater than
20%, EBITDAs (earnings before interest, tax, depreciation and amortization), EBITs and net incomes consistently
run among the industrys best. Like all of the truly strong players, these results are clearly and straightforwardly
reported for each financial period. Gross profit (net revenue) runs 40% for air freight, >30% for ocean freight and
>25% for SCM.
Panalpina concentrates on six verticals/segments: Automotive, Healthcare, High-Tech, Oil & Gas,
Retail/Fashion, and Telecommunications. Telecom growth was major in 2007. The Oil & Gas operations are
primarily in project logistics, which accounts for 10-15% of Panalpina's revenues.
U.S. Headquarters Contact Information:
Panalpina, Inc.
1776 On-the-Green
67 E. Park Pl.
Morristown, NJ 07960
Phone: +1-973-683-9000
Fax: +1-973-254-5712
Email: info.usa@panalpina.com
Provider's Strengths
Good air and ocean freight forwarder with modern logistics operations.
Provider's Weaknesses
18th Edition
Attendees:
Lucas Kuehner, Managing Director, USA
Markus Wegmann, Head of Operations, USA
Armin Heinlein, Vice President & Head of IT Competence Center, Americas
Norman Rasmussen, Head of Luxury Goods
Tim Hotze, Manager of Logistics and Supply Chain Solutions
Valerie Kilburn, Director of Customer Systems
Some guys can do it and some guys just talk about it. Panalpina is a doer and one of the few real global supply chain managers.
Panalpinas supply chain capabilities are built on its freight forwarding and cross docking operations. Panalpina is the third largest air freight
forwarder and fourth largest ocean freight forwarder. It has 500 owned offices and 242 warehousing locations. In short, it has the scale and
scope to carry out global operations as a global freight forwarder and then add-on a host of integrated Logistics and SCM value-added services.
The value-added services are the complement for door-to-door, full service, supply chain management (SCM).
The life blood of Panalpina is its ongoing financial stability and transparency. Its gross profit runs 20%, EBITDAs (earnings before interest,
tax, depreciation and amortization), EBITs and net incomes consistently run among the industrys best. Like all of the truly strong players, these
results are clearly and straightforwardly reported for each financial period. Gross profit (net revenue) runs 43% for air freight, 31% for ocean
freight and 26% for SCM.
Feeding the profitability of the company are 14,800 employees operating in Panalpina-owned offices with standardized procedures and solid
IT. This, however, is to be expected because Panalpina is culturally a Swiss company at its core. The structure allows support for creativity
and innovation.
Value-added warehousing and distribution activities include all the standard major third-party logistics provider (3PL) capabilities from pick
& pack execution to postponement, light assembly to vendor managed inventory (VMI), just-in-time (JIT) and reverse logistics. Milk runs,
merge-in-transit and direct-to-store programs are also standard offerings.
Of course, global supply chain management depends on best-in-class IT systems. Panalpina utilizes standardized hardware and software
environments, running an IBM server System-p (AIX) and System-x (Wintel) server farms. The System-x (Wintel) applications are published via
a CITRIX virtual desktop. A customized version of Manhattan Associates Warehouse Management System (WMS/ILS)/Transportation
Management System (TMS) is used with MS Exchange deployed as middleware.
The System-p (AIX) servers are used to host Panalpinas proprietary Forwarding Systems, SAP (ERP) and several other specialized WMS
solutions. Panalpinas environment is highly virtualized on both the System-p through IBM server virtualization and System-x through VMWare
ESX. The company is working closely with telecommunications companies around the world to efficiently maintain their network of offices.
The network is globally connected via two global telecommunications partners Verizon and British Telecom (BT).
Not everything is standardized, however. Certain country specific items like customs brokerage filings are handled locally. For the U.S.,
Panalpina has been driving the development and consulting process for a Customs application with a leading software provider. The servers
running the U.S. customs and local systems are based in New Jersey. The Forwarding Systems are hosted in six datacenters around the world
with the main one located in Basel and a backup datacenter a few miles away.
Panalpinas IT platform depends on a centrally-integrated communication repository of data operating in real-time. Interfaces, multiple data
entry and redundancy are minimized.
The Logistics and SCM applications are grouped together under the PANLOGIC Application Suite. PANLOGIC has three major parts
tracking, supply chain management and warehouse management. The applications cover communications software, supply chain activity,
advanced planning/collaboration and local tools. Supply chain activities are order management, fulfillment, inventory and transportation
management.
Panalpina mainly employs two track & trace systems. PANTRACE is the publicly accessible system with basic shipment tracking
information (accessible at www.panalpina.com). INTRAC is the proprietary sign-in system for vendor booking and supply chain visibility.
INTRAC information covers orders (suppliers, pickup, warehouse receiving, compliance/consolidation/booking, tendered/in-transit shipments,
destination arrival, customs clearance, domestic transport and delivery) and is applied for efficient purchase order management.
In the more advanced collaboration SCM platform called Supply Chain Application (SCA), the user is presented with a set of screens for data
management in which data is congruent and telescoping for purchase orders (buyer and supplier), transport orders, shipment legs, license plates
(pallet and case levels) and item/stock keeping unit (SKU) numbers. SCA is built on a Manhattan Associates software base incorporating all the
INTRAC capabilities but allowing for even greater detail and additional functionalities such as the supplier enablement module and fulfillment.
At the screen level the user starts with Dashboard, Purchase Orders, Transport Orders, Shipments, Loads, Inventories, Fulfillment,
Notifications and Administration. Reports are customizable and important documents like bills-of-lading and invoices are scanned in at origin
and are attached to every purchase order/shipment file.
Warehousing and inventory management are fed by radio frequency (RF) terminals and barcode scanners. CubiScan, a laser based,
automated system, is used for weighing and dimensioning freight.
Panalpina has a broad portfolio of warehouse management systems and also operates its proprietary transit warehouse management system,
iPAWS. The warehouse management systems feed information via a global shipment database into SCA (and back), and as such allow for a
seamless logistics execution. The warehouse management systems are sourced from Xelog, Manhattan Associates and Hal Inc. (C2C). The
latter is the industry standard in the oil and gas industry and as such an important addition for Panalpinas extensive oil and gas project logistics
operations (oil and gas project logistics accounts for 10-15% of Panalpina's revenues).
For transportation management, Panalpina has used a series of proprietary and off-the-shelf systems. For transportation procurement,
Panalpinas AirWarder and SeaWarder are being used. On the trucking side, LBase is deployed for dispatch, control of pickups and deliveries.
A major TMS upgrade is in the works in partnership with SAP. The prototype will be tested in the fall of 2009.
Supply Chain Management Customers
Panalpina maintains a North American Luxury Goods Hub in Secaucus, NJ. This customs bonded warehouse is 175,000 square feet with 16
18th Edition
dock doors, a 28' clear roof, high-value cages, 48 surveillance cameras and motion detectors. The warehouse is high-touch with extensive
garment on hanger (GOH) operations.
The customer list is a whos who of high-value goods and includes: Armani, Gucci, Diane von Furstenberg, Louis Vuitton, Bally, Chanel and
others. Because of the high-value, time-sensitive nature of the goods, a significant amount of air freight is involved.
A partial list of value-added services includes:
VMI
End-to-end GOH
Direct Store Delivery
Item Pricing and Labeling
Re-conditioning
Kitting and Light Assembly
Customs Pre-classification
Reverse Logistics
Pick, Pack, Relabeling, etc.
Panalpina prepares floor-ready-merchandise for some customers. Items are priced and labeled, then moved directly to the floor. This process is
more efficient and hence more cost effective than preparing merchandise in the stores. Of equal importance is service quality, especially meeting
the twice-yearly sale peaks of retail customers.
A good European example of Panalpinas complete supply chain management is Leder and Schuh (Leather and Shoe), an Austria-based
company. Seventy percent of the companys manufacturing is now done in China and Vietnam. Customers are primarily in the Central
European countries where Leder and Schuh is a major player. Panalpina performs purchase order management from 200 suppliers involving
50,000 orders and 800,000 items a year. Services are managed by Panalpina end-to-end all the way through to store delivery.
Other Vertical Examples
Automotive Panalpina operates an 800,000 square foot complex in Montgomery, AL for automotive manufacture support. The principal
customer is the nearby Hyundai plant. Panalpina provides sequencing, light assembly and JIT support.
Oil and Gas The oil and gas logistics segment, especially involving air freight of large cargoes, has been consistently expanded and
Panalpina is the market leader in this field. Panalpina covers a host of challenging destinations in West Africa and the Middle East to meet its
clients needs.
High-Tech High-tech customers utilize a significant amount of air freight and value-added services. Panalpina is a natural choice for
customers like IBM, Celestica, Hewlett-Packard, Palm and Philips Consumer Electronics, to name a few.
Panalpina, for instance, engages in high-tech fulfillment operations. In Huntsville, AL, it completes high-volume configure-to-order
fulfillment requests. Returns are also handled through these facilities.
Telecommunications Panalpina engages as the 4PL for Telus Communications, a provider of next-generation cell phone base station and
peripherals technology. Panalpina manages their purchase orders and engages in marshalling of sales delivery orders. Due to the nature of the
business, most deliveries are assembled as single loads to be delivered to special construction sites. Panalpina manages the to-site delivery which
regularly incurs special rigging activities.
Healthcare and Chemicals Panalpina operates a unique own charter operation between hubs in Luxembourg and Huntsville, Alabama.
Several 747-400 aircrafts run the lane called the Dixie Jet. Panalpina has cooler facilities at the Huntsville airport and can offer an integrated cool
supply chain for pharmaceutical companies. Panalpina has direct tarmac access in Huntsville and as such can turn around the aircrafts extremely
fast. In addition, Panalpina can supply Envirotainer equipment for temperature-controlled end-to-end cold chain moves.
Panalpina Adding Transit, Logistics Space in Dubai
Company says new hub is part of expansion plan in the Middle East
Panalpina, the Swiss global logistics and freight forwarding group, began operations at a 450,000-square-foot, state-of-the art multimodal
transit and logistics hub in Dubai.
The new facility, in the Dubai Logistics free trade zone, is adjacent to the new Al Maktoum International Airport and the Jebel Ali seaport.
This facility represents a milestone in our expansion strategy in the Middle East, said Claus Schmidt, Panalpina managing director of the
Arabian Belt region.
It will allow us to significantly increase our service offerings in supply chain management by providing a seamless integration of
international air, ocean and trucking services with our logistics and order fulfillment services, Schmidt said.
The facility comprises 30,000-square-foot of office space, a 120,000-square-foot multipurpose logistics operating area with 10,000 pallet
positions in a temperature-controlled environment and a 150,000-square-foot lay down area.
Panalpina and Cargill renew collaboration
Basel, 19 May 2010, After a successful 2009 sugar crop, whereby Panalpina moved approximately 5000 TEU for Cargill Sugar Division, the
partnership has been extended by renewing the current service contract with Panalpina Brazil for a further year. The volume forecast for the
2010 crop season is approximately 1000 TEU per month from Santos to destinations mainly on the Indian subcontinent, the Mediterranean and
the Middle East.
The Cargill contract goes in line with the strategy to further expand our business within the commodity markets. The innovative solutions
developed and designed together with Panalpina Ocean for the Cargill business shows that our unique and refreshing approach is very much
welcomed in the market comments Daniel Setz, Country Manager Panalpina Brazil.
Sleepless in Sydney
Australian ResMed develops medical products that let people with respiratory disorders sleep well again. Panalpina supports its customer with
professional logistics services.
18th Edition
ResMed was formed in 1989 with the primary purpose to commercialize a device for treating sleep apnea. Since then the company has
become a leading developer, manufacturer and marketer of products for the screening, treatment and long-term management of sleep-disordered
breathing and other respiratory disorders. It operates in more than seventy countries and is listed at the Sydney and New York Stock Exchange.
For its international logistics it trusts Panalpina.
A brief look at human anatomy is necessary in order to understand how ResMed's products work. Snoring and sleep apnea are caused by a
narrowing of the upper airway during sleep which leads to vibrations commonly referred to as snoring. In case of a complete collapse of the
upper airway, respiratory failure lasting from ten seconds up to two minutes is possible. A shortage of oxygen will prompt the brain to wake up
and restart respiration. In extreme cases, this procedure unconsciously repeats itself several hundred times per night.
ResMed's approach is as simple as its implementation is complex. The key is continuous positive airway pressure, CPAP. From a device,
patients receive light air pressure that forms something like an air wedge keeping the airway open and thus avoiding sleep apneas. Air pressure is
precisely controlled by software and adjusted to a patient's specific anatomy. ResMed's latest innovation, the s8, fits into a hand and barely
weighs one and a half kilos - crucial characteristics for patients on the road. Furthermore, ResMed is constantly developing more comfortable
masks and reducing the air pump's noise level.
Today Panalpina supports ResMed's logistics in two dozen local organizations on four continents and with a wide array of services. The two
partners have come a long way in very short time: It all started in September 2007 when Panalpina was awarded a two month trial of air freight
export from Sydney to the U.S. In March 2008 Panalpina was among a group of service providers invited to take part in an RFQ and tender
procedure for a new logistics warehouse in Singapore to support ResMed's newly created manufacturing facility to support the company's
ongoing growth. Panalpina was awarded the international air and ocean freight into and out of Australia, customs brokerage world wide, the
Singapore logistics warehousing, the international air and ocean freight into and out of Singapore, the ResMed 3rd party suppliers world wide
into Singapore and intra-Asia cross traffic to support new product lines, the international air and ocean freight from Asia to North America to
support the ResMed Motor Technology business as well as traffic to India where ResMed had just established its local operation in 2009.
We were looking for a global service provider who takes initiative and continuously seeks improvements, for example by changing routing
or minimizing lead times. With Panalpina we have developed strong relationships within all levels of the business in all locations within our
supply chain, says Graeme Scott, Global Director of Logistics at ResMed. And Lyndall Smith, Global Account Manager for ResMed at
Panalpina, adds: With our global network we are able to leverage volumes to provide total and ongoing end-to-end cost solutions to ResMed
and also progress with them as they expand their global footprint.
Nasal continuous positive airway pressure therapy was developed in 1981 by Professor Collin Sullivan and colleagues (University of Sidney,
Australia) and provided the first successful non-invasive treatment of sleep apnea.
Project shipments require all team members to do their part
Operations in which outsize machinery, turbines, silos, boats, rail wagons and the like are painstakingly maneuvered over level crossings,
under bridges or through winding streets not only yield spectacular pictures for the cover of trade journals, but also make front-page news in the
local papers. But the carriage of heavy goods and outsize components is only one aspect of Panalpina's projects business. Panalpina ensures that
all on-the-ground handling of heavyweight shipments is entrusted to suitably equipped specialists.
"This niche logistics market involves the provision of special forwarding, heavylift and project management services using cranes and special
transporters. The shipped components include not only bridge girders, prefabricated structures and roof assemblies for the building industry, but
also special vehicles such as construction or agricultural machinery, railway and tram rolling stock plus industrial equipment such as generators,
wind power plant and high-capacity boilers." This outline of the projects sector was given by Christian Kille, Head of Logistics Market
Intelligence at the Fraunhofer ATL in Nuremberg, in an article published in the Deutsche Logistik-Zeitung (DVZ) trade journal. "Such
shipments therefore require a special vehicle fleet that includes low-loaders, heavy-duty towing equipment, mobile cranes and stacker trucks
together with specialist expertise in heavy-goods handling," he adds.
In exceptional cases with our own vehicles...
Panalpina only procures its own means of transport where this is necessitated by particular project circumstances or where the required
carrier types are not locally available. Such a situation arose several years ago in connection with a major project in the Kashagan Oil Field in the
Caspian Sea, some 80 km south of the Kazakh city of Atyrau. To meet the specific requirements, Panalpina's project managers commissioned
the custom-fabrication of two lighters plus mooring and procured special hydraulic heavy-goods transporters. As Chris Kent from Panprojects
London explains, "We had to move some 88 so-called super-out-of-gauge items, 43 meters long by almost 7 meters tall, and weighing up to 657
tonnes." The special lighter barges and mooring near Atyrau were needed to allow the use of shallow waterways not navigable by standard
vessels.
...though generally in collaboration with partners
As a rule, however, Panprojects appoints subcontractors with particular expertise in the services described above Panalpina's corporate
project shipments competence centre is headquartered in Bremen, Germany. Panprojects focuses on the preparation, organization and
coordination of complex logistical tasks. In many cases, the preliminary work - including investigations into the local topography and any
potential need for alterations to the road or rail infrastructure - commences months before the first shipment. On many contracts, Panprojects is
also responsible for proper freight packaging, enforces HSE regulations and provides a tracking & tracing facility.
Panprojects enjoys all the benefits of the Group's global air and sea freight network. Apart from the outsize and heavy goods typical of major
projects, there are also many tonnes of components and spare parts for containerized shipment by sea or, if urgently needed, by air. In the
words of Thorsten Grams, Corporate Head of Operations at Panprojects, "A world-spanning network is essential in guaranteeing the punctual
delivery on site of consignments originating from a host of different countries." For Maria Teresa Berini, Head of Logistics at Panalpina's
customer Tecnimont, this was one of the key criteria behind the appointment of Panalpina as logistics provider for a project in the Persian Gulf:
"Particularly crucial for us was the international reach of Panprojects, its access to a global network that is excellently equipped to meet our own
specific needs and the concrete demands of the project," she emphasizes. "During the course of the project, our high expectations of Panalpina
were satisfied to the full." The project in question entailed the construction of a chemical plant. Working in tandem with the customer, the
Panprojects specialists devised a comprehensive solution involving 13 local Panalpina branches on four continents. The overall freight volume
ran to 140,000 tonnes, to be delivered according to a clearly defined schedule. The contract was overseen round-the-clock by a team of logistics
18th Edition
Swiss based forwarder Panalpina has announced heavy falls in revenue and profits for its financial year 2009 driving the company into loss in
terms of profit after tax. As expected, revenue fell but what really hurt Panalpina was the rise in freight rates and the consequent compression of
their margins.
Net forwarding revenue for 2009 fell by 32.9%, to CHF5.9bn (4.04bn/$5.5bn) for the year with huge falls of 38% and 40% for the second
and third quarter. However EBIT (Earnings Before Interest and Tax) collapsed, falling by 83.9% to CHF29.9m (20.5m/$27.9m), reflecting
near or actual losses in the first and third quarters. Consolidated profit after tax was negative by CHF11m (7.5m/$10.3m).
Underlying volumes in terms of tonnes saw falls of 19% and 14% for air and sea freight respectively, but gross profit per tonne, fell by only
18th Edition
7%. The problem is Panalpina not only failed to capitalize on the very soft rates earlier in the year, it also suffered badly in the fourth quarter as
rates hardened sharply.
Panalpina admitted this in describing the changing market dynamics of its fourth quarter performance in the air freight market. Here it saw a
"double digit" jump in volume leading to "strongly rising freight rates". The "associated time lag in passing on these higher rates to customers
led to an unprecedented squeeze of GP [gross profit] per unit of cargo in Q4, which fell >30% year-on-year".
Monika Ribar, Panalpina's CEO, stated that, "Although we reacted quickly on the cost side and increased productivity, the measures taken
could not compensate for the sharp fall in volumes and a rapid increase in buying rates in the second half of the year." Panalpina also said that
the company's reliance on larger customers affected demand as such customers recovered less quickly than the market generally. It also
continued to be affected by the loss of its Nigerian traffic.
These figures must be viewed with concern by Panalpina. It has performed below the level of most of its big rivals both in terms of
profitability and possibly in terms of market-share. The worrying thing is that this seems to be caused by a management that is slower and less
adaptable than its competitors. The company has re-organized in order to deal with this problem, including removing some senior managers.
This will have to deliver considerable benefits if Panalpina is to regain its direction.
18th Edition
82-2-3771-2444
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1977
Asset Focus:
Market Area:
Founding Business:
Global
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Sung-koo Yeo
Seok-Tae Kim
Wang-Je Cho
CFO
CIO
2,285
Ticker Symbol
2,285 **
Exchange:
2,440
300
1
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
26.4
0
4
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Healthcare
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Abbott Laboratories
Pharmaceuticals
Korea
Anam Electronics
Korea
Canon
Korea
Korea
Dongbu HiTek
Chemicals
Korea
Doosan Infracore
Engineering, Construction
Korea
E-Land
Apparel
Korea
General Electric
Diversified Financials
Korea
GS Caltex
Petroleum Refining
Korea
GS E&C
Engineering, Construction
Korea
Hewlett-Packard
Korea
Hitachi
US
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Latin/South America
Austria
Canada
China
France
Mexico
Brazil
Panama
India
Germany
United States
Indonesia
Italy
Dubai
Cambodia
Oman
Saudi Arabia
Australia/New Zealand
Pantos
Australia
Netherlands
Japan
Kazakhstan
Poland
Russia
Korea
Spain
Malaysia
Turkey
Singapore
Thailand
Ukraine
United Kingdom
Uzbekistan
Vietnam
EDITOR'S COMMENTS
Pantos Logistics has a full set of tools including air and ocean freight forwarding, rail and road transportation in
Korea, warehousing, customs, and express transportation. Customers include Korean based companies like LG
and internationals like Philips. Pantos is a good international supply chain manager with a large freight forwarding
base (1.3 million TEUs and 317,000 airfreight metric tons).
Provider's Strengths
Provider's Weaknesses
Signs cooperation agreement in freight transportation with Atlas Air, set to seek expansion of joint projects
Pantos Logistics, Koreas largest general logistics firm (President Yeo Sung-koo), signed an agreement on air logistics cooperation with
Atlas Air Worldwide Holdings, the parent company of Atlas Air of the U.S., the worlds largest air freight company. With the agreement, Pantos
Logistics formed a strategic alliance, which calls for Atlas Airs offer to grant Pantos Logistics stable supply and operation of freighter aircraft
for air freight transportation, while Pantos Logistics seeks to attract stable volumes of freight for transportation to and from countries, to which
Atlas Air operates service routes. Additionally, the two sides agreed to stage joint marketing in the global air logistics market, and continue to
expand the scope of mutual exchange and cooperation.
The alliance between Pantos Logistics and Atlas is expected to help expand the supply of air shipping services in the domestic air logistics
market, which is having trouble securing shipping services due to successive recent cancellations of routes by airliners. Also, the deal will likely
diversify and stabilize the sources of freighter aircraft, and thus help boost export competiveness of freight owners.
Atlas Air provides about 140 chartered aircraft to Pantos Logistics as of 2009. The air career plans to deploy additional 12 B747-800 aircraft
to the Korean market in 2010. Atlas Air, which is known as the worlds largest air logistics firm that possesses 37 jumbo freighter aircraft B747,
is operating routes to and from 112 countries worldwide. The company entered the Korean market in 2001 through its subsidiary, Polar Air
Cargo.
18th Edition
PLRTM@Penske.com
610-775-6291
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Truck Leasing & Rental
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
Major LLP in North America, especially in automotive, with good Europe and Asia operations.
KEY PERSONNEL
Vince Hartnett
President
Jim Feenstra
Terry Miller
SVP Marketing
EVP Operations
Paul Ott
Tom McKenna
Ticker Symbol
2,387
736 **
7,181
255
3-5
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
2,542
Total Trucks:
275
Total Trucks:
Total Other:
44
Total Trailers:
Total Aircraft:
448
23
Total Tankers:
Total Other:
275
3,949
0
Total Ocean:
Total Other:
44
12.3
4
21
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies, Proprietary--LMS
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i2 Technologies, Proprietary
i2 Technologies
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
ISO Certified Certification Locations: Over 50 locations in the Americas, Europe and Asia.
Other Services:
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Allison Transmission
China
Food Production
Europe
BMW
Mexico, US
China
Bombardier
Europe
Cardinal Health
N. America
Carpenter Technology
Metals
China
Continental Tire
China
Daimler
US, Europe
DSM
Chemicals
Europe
Eastman Chemical
Chemicals
US
Eaton
Industrial Machinery
N. America, S. America, E
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
China
Penske Logistics
Europe
North America
Latin/South America
Estonia
Canada
Brazil
Germany
Mexico
Italy
United States
Netherlands
United Kingdom
EDITOR'S COMMENTS
Penske Logistics is a major automotive logistics player. It is Fords lead logistics provider and provides
significant services for General Motors, Daimler and tier-one suppliers. Penske Logistics is one of five major
automotive 3PLs with over $400 million per year in revenues in this segment. Penske Logistics is a master of
inbound supply chain management, cross-docking, sequencing, dedicated contract carriage and just-in-time
support. Penske Logistics has made significant strides in leveraging its automotive experience to other verticals.
Major wins include: Steelcase, PPG, Wawa, Mission Foods, Samsung, Sony, Merck, Eaton and Emerson. Penske
landed a major deal with Cardinal Health involving 700 trucks in DCC in 2008.
Mexican and Brazilian operations are particularly strong. European business continues to grow and gain in a
much tougher market. Penske Logistics recently opened a Shanghai, China branch to broaden its global network.
It has expanded operations in India.
Provider's Strengths
LLP quality operator with South American and European reach.
Provider's Weaknesses
Needs to broaden and globalize offerings while preserving profitability.
Key Personnel:
Jim Erdman, Senior Vice President Asian Operations
Joseph Gallick, Senior Vice President of Sales
Robert Bos, Vice President of Sales Strategic Accounts
Angela Yang, General Manager Asian Operations
Justin Barrow, Director Business Development
Jezi Ji, Regional Manager , Sales
Don Pingley, Operation Manager Warehouse Management
Peter Wei, Operation Manager Warehouse Management
Steve Yang, Project Supervisor
Chris Mitchell, Logistics Solutions Manager
Penske China Overview
To position itself to meet the long-term potential of the Chinese 3PL market, Penske Logistics established its Asian headquarters in
Shanghai, China in 2005. Initially it began operations as a consulting licensed Wholly Owned Foreign Entity (WOFE). Then, in 2006, it made an
acquisition of a local logistics provider and became a licensed international trading company, Class A licensed freight forwarder, and customs
broker. Today, Penske Logistics has a staff of 102 in China supporting 12 major contract customers. It manages operations in 15 major cities
throughout China with a mix of Penske run and agent operations. Penske run operations are in six major cities: Beijing, Shanghai, Shenyang,
Guangzhou, Suzhou, and Jinan. It has a total warehousing footprint of 237,000 square feet and is managing approximately 2,500 annual TEUs
(trailer equivalent units--20 containers) as an ocean freight forwarder. For 2008, Penske had China revenue of $10 million.
Penske Logistics current customer operations in China include:
Value-added warehousing, distribution, and import/export support for Allison Transmission.
Warehousing and manufacturing support for the J.V. (joint venture) of BMW - Brilliance Automotive.
Value-added warehousing, distribution, and import support for Carpenter Technology.
Warehousing and distribution management for Continental Tire.
Warehousing, private and premium labeling, and distribution for Master Lock.
Warehousing and transportation management for automotive supplier Nissens.
On a recent visit to Shanghai we had the opportunity to review some of these operations and they are detailed below.
18th Edition
Wai Gao Qiao Multi-Client Bonded Warehouse and Allison Transmission Aftermarket Parts Operation
A short drive from downtown Shanghai is the Wai Gao Qiao (WGQ) free trade zone (FTZ) and Shanghai ocean shipping port. In December
2008, Penske Logistics opened a new 62,000 square foot bonded warehouse to house a service parts value-added warehousing and distribution
operation for recently signed customer Allison Transmission and a handful of smaller accounts.
The WGQ bonded warehouse manages imports and exports, domestic transportation, customs brokerage, and value-added warehousing
activities including: kitting, labeling, product quality inspections, and pick/pack. Most products handled at the warehouse are imported goods
being distributed within China. Penske Logistics has permission to use the Chinese government's CIQ customs information system to track
inbound product through customs clearance. Its staff notifies customers of product movement and final clearance. In addition, they prepare the
necessary documentation for domestic distribution.
To support its warehouse operations, Penske Logistics utilizes the popular Chinese warehouse management system (WMS) "Flux WMS".
Flux provides good warehouse management and inventory management functionality. It is also interfaced with wireless radio frequency devices
for picking, putaway, and other warehouse tasks.
The aftermarket service parts distribution operation Penske Logistics runs for Allison Transmission is the largest at the WGQ warehouse and
takes up approximately one-third of the entire warehouse.
The Allison operation began operations in December 2008. Penske is managing approximately a thousand SKUs (stock keeping units) of
parts as part of the value-added warehousing and distribution operation.
Ocean containers and airfreight shipments of parts are received into the warehouse for Allison. Penske works with China customs to support
clearance of all inbound parts. Once parts clear customs, they are received at the warehouse. All received parts are checked against ASNs
(advance ship notices) that are received electronically into the Flux WMS. After physical receipt, the service parts are putaway into dedicated
rack, bin, and shelf storage warehouse locations.
Penske receives hundreds of outbound parts orders directly from Allisons customers each month. Once the order is entered into Penskes
WMS, the information is sent to Allisons SAP system via EDI. An order acknowledgement form is then returned to Penske thus allowing
further processing of that order. Each outbound parts order can range from one piece to over a few hundred pieces. The orders are processed
for all repair facilities in over 10 Asian countries including domestic China. Approximately 30% of the order volume is for domestic China repair
operations and the rest require export processing.
Penske picks the order quantities, labels specific parts, packs out the orders and builds kits of parts as requested. As an additional value-added
service, it also applies antirust coatings to parts for Allison. Instead of having each picker also pack out the order, Penske has a different
warehouse worker label parts and pack out the order to ensure order accuracy. Each outbound order is also weighed for freight optimization. In
addition, Penske performs a credit check and obtains a credit release from Allison before shipping any order.
Once orders are available for shipping, Penske will work with the customer, China Customs, and the appropriate transportation vendor to
determine the best shipping method. Depending on the required delivery date, Penske will either ship the order that day, or consolidate it with
additional orders to reduce Allisons overall transportation costs. The outbound shipments are routed via international airfreight and require
Penske to prepare customs and export documentation and coordinate transportation with Allisons approved freight forwarders.
Penske is currently exceeding all of its KPI (key performance indictor) goal requirements for the Allison Transmission operation. The KPIs
include: receiving putaway time, order fulfillment processing, order line delivery accuracy, shipped goods condition, and goods labeling accuracy.
Minhang District, Multi-Client Distribution Center Operations
In 2008, to support its customers expanding domestic China distribution and international export needs, Penske Logistics added an
additional 50,600 square feet of multi-client non-bonded distribution center (DC) operations to its China network. Located in the Minhang
district of southwest Shanghai, the operation is segmented into three storage bays in one warehouse and one bay in another close by warehouse.
Penske began handling value-added warehousing and distribution operations for Nissens, a producer of automotive radiators and climate
control equipment, in April 2009.
Several shipments of product are received monthly from Nissens multiple Chinese contract manufacturers. After receiving the product into
the warehouse, an on-site Nissens employee performs random quality control inspections on the product. All items are then labeled with a
Nissens barcode and specific serial number information. Several outbound containers of product are then shipped from the DC each week. The
operation is anticipated to process several hundred thousand units annually.
The Nissens operation was established as a DC bypass strategy. Previously, all product from the Chinese contract manufacturers was shipped
to a central DC in Denmark for quality control inspections and European distribution. Now manufactured product is shipped to the Minhang
warehouse for quality inspections and then exported directly to individual country DCs and the U.S. This strategy provides for quality
inspections closer to the manufacturers, reduces inventory levels through direct shipping, reduces transportation costs, and minimizes damages
through less handling.
The second distribution operation we toured was for industrial products distributor First Bridge. The operation start up began in September
2008, the warehouse set up is evolving with First Bridges distributed products mix change.
Several hundred SKUs of product such as machine belts, engine seals, grease, bearings, induction heaters, and hydraulic pullers are
maintained in inventory. Penske performs a 100% quality control inspection on all inbound product. Outbound orders are picked, packed, and
shipped to First Bridges's industrial manufacturing products dealers.
Next we reviewed the Master Lock domestic China distribution operation. Product received into the DC is sourced by Master Lock from
various worldwide manufacturing locations including OEM suppliers from China. For imports, Penske is managing customs clearance. In
addition, it performs SKU, aesthetic and packaging quality inspections on all inbound product.
Over several hundreds of SKUs of product and a sizeable quantity of individual pieces are maintained in finished goods inventory. Penske
receives multiple orders per day from Master Lock. Each order contains various SKUs of product and multiple individual items. All items are
individually picked and packed for delivery to stores, supermarkets, and distributors. Penske is also performing product labeling and some kitting
work as part of the operation.
The final warehouse we toured contained the new high-tech package assembly and distribution operation.
This just-in-time (JIT) operation assembles specialized cartons with foam inner packs and reinforced bottoms that are forklift friendly. Those
cartons are sequenced daily to a contract manufacturers local manufacturing line where they are used to pack out computer network equipment.
All of the cartons are loaded onto a Penske shuttle truck and are required to be delivered by 12:30 P.M.
As part of its service, Penske is also sourcing some of the components locally they use in their assembly operation.
Summary
18th Edition
Penske Logistics is leveraging its multinational customer base and expanding local expertise to grow its operations in China. It has
successfully positioned the company as both a "China Gateway" for U.S. and European customers moving material and product in and out of
China and as an established domestic China 3PL managing domestic transportation, providing warehousing and distribution services, and
supporting plants with its tier-one inbound logistics services. As the domestic Chinese value-added warehousing market develops, we anticipate
that Penske Logistics will have a solid network in place to address the needs of both multinational customers and domestic Chinese companies.
Penske Logistics Europe [To view in full html format, follow this link: http://www.3plogistics.com/Penske_Europe_12-2007.htm]
Roosendaal, Netherlands - Site Visit
December 12, 2007
Key Personnel:
Joe Gallick, SVP Global Sales
Erik van Egmond, Managing Director Europe
Dirk-Jan Zwagerman, Director of Sales
Edwin Holleboom, Contract Manager
Marco Stroeken, Senior Manager Chemical Unit
Richard Edelman, Manager TMS Operations
Necessity is the mother of invention and when Erik van Egmond took over as Managing Director of Penske Logistics Europe, the need was
great. The operation needed to convert from a red ink trucking company to a black ink third-party logistics provider (3PL). To make it tougher,
the new Penske Europe operation had to compete with very large competitors in a mature logistics market.
Out of necessity, new, better and more market attractive services had to be designed.
By 2002, Penske was an i2 test site. By using i2, it was developing a solid transportation management capability. About the same time, GEs
quality management program got introduced at Penske Logistics.(1) Erik van Egmond and his team melded the two together. They now use
this state of the art Process Improvement (PI)/TM offering to land new business against major Europe based competitors. The new approach
has significant C level appeal among customers.
Penske now offers customers an optimized transportation system allowing for better reporting, transparency for all inbound and outbound
inventory, consolidation of less-than-truckload (groupage) and better trucking equipment utilization. Penske can model the system before
beginning its TM role. As a consequence, major structural changes such as distribution center relocation may result early in the process. Often,
however, it takes 6-12 months of managing the operation and developing baselines to hone in non-conformities which disrupt processes. A
host of performance measurements are taken on the process. Root cause analysis is done on the non-conformities. Processes are then
improved, controlled and re-measured.
Penske quality instruments begin with entry of all shipments, continuous monitoring of all shipment pickups, deliveries and any damage or
loss. Failures to perform are dealt with quickly. Carriers utilized under contract to Penske are given monthly scorecards. Failure Mode and
Effects Analysis and 5-Why Analysis are used to get at process execution, order entry and customer service failures. For example, a 5-Why late
delivery analysis might reveal that a traffic jam occurs regularly at certain times on a route. Changing to an alternative route can solve the
problem.
Penskes attention to detail allows its customers to shorten order cycle times, reduce inventory in the pipeline and plan more precisely.
Standard practices are:
Weekly non-conformance meetings of operating people
Monthly operations meetings by account for personnel from customer service, planning and contract managers
Weekly transportation management system (TMS) management meetings with regional directors, supervisors and contract managers
attending
Daily, weekly, and monthly key performance indicators (KPIs) and team quality reports
Periodic (Six Sigma) analysis
Complaint resolution
Carrier management reporting
5-Why analysis
Supplier performance reporting
Inbound order defect review
Failure mode and effects analysis
Voice of the customer reporting through C.A.R.E. (Customer Account Retention Efforts) and CTQ (Critical to Quality)
Using its PI/TM approach, Penske has won some key accounts for whom it is now the Lead Logistic Provider (LLP). Bombardier, Eaton,
DSM, Ford Europe and Merck Sharp & Dohme are examples.
Bombardier Transportation
Bombardier Transportation (BT) builds locomotives, bogies, light rail vehicles, and propulsion and control systems. It has 32 production
sites in 12 European countries. 1,000-1,500 different suppliers make 100,000 shipments a year.
BT selected Penske as its LLP to manage its supply chain. Penske now manages all inbound and outbound. It also runs materials sequencing
centers for production.
As a result of Penskes activities, BT gets optimized material flows, information control and new value-added services. Penskes service went
live October 2007.
A key change has been to take control of transportation Ex Works allowing for better rate negotiation and optimization. Outbound
transportation includes freight forwarder management for global distribution. Value-added services performed are sequencing parts for
production, kitting, subassembly and continuous improvement.
Penske prevailed over other notable global supply chain managers (GSCMs) to win BTs business. Subsequently, they have collaborated with
Schenker to provide transportation services a strength for Schenker in Europe. Similarly, Penske works with UTi as a primary freight
forwarder. Over 25 BT personnel from different divisions reached agreement on Penske as the LLP. Previously, each division had operated
independently.
Penske has implemented most of its TM control and system. Value-added services are being initiated mid-2008. When fully implemented,
18th Edition
Key Personnel:
Jim Erdman, Senior Vice President - Asian Operations
Joseph Gallick, Senior Vice President of Sales
Aditya Mishra, CFO - Asian Operations
Gary Franz, Vice President of Sales - Global Accounts
Victor Wang, Logistics Manager
Peter Wei, Operation Manager - Warehouse Management
Scott Zhang, Continental Project Manager - Logistics Engineer
The third-party logistics (3PL) industry in China is a tale of two major 3PL market segments--international freight forwarding and domestic
warehousing and distribution. Over the last 15 years most 3PL revenue growth has been generated by international air and ocean freight
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forwarding. The domestic market includes 3PLs such as Penske Logistics whose main focus is on supporting the distribution of goods within
the domestic Chinese market. As the Chinese per capita income increases, its population of 1.4 billion will continue to demand more and more
goods. To support this demand significant improvements are beginning to be made in domestic warehousing and distribution. Due to the
developing Chinese economy and increased personal wealth, it is easy to argue that freight forwarding will grow at some factor of China's GDP,
while the domestic 3PL market holds greater long-term potential.
To position itself to meet the long-term potential of the domestic Chinese 3PL market, in 2005 Penske Logistics established its Asian
headquarters in Shanghai, China. Initially Penske Logistics began operations as a consulting licensed Wholly Owned Foreign Entity (WOFE).
Then in 2006 it made an acquisition of a local logistics provider. Through the acquisition, Penske Logistics became a licensed international
trading company, Class A licensed freight forwarder, and customs broker. Today Penske Logistics has a staff of over 100 in China, manages five
facilities totaling 140,000 square feet, and generates revenues of $5M.
Penske Logistics current projects in China include: warehousing and distribution management for Continental Tire, export consolidation and
international transportation management for Knoll, international transportation management for Key Safety Systems, managing an international
J.I.T. hub for Eaton, customs clearance and domestic distribution for GE, and import and domestic distribution management for BMW. In
addition, it has begun operations in a new 5,000 m2 material supply center (pictured below) for BMW Brilliance Automotive in Shenyang and a
500 m2 warehouse in Beijing for BMW AG (marketing products).
Continental Tire Domestic China Warehousing and Distribution Management
Penske Logistics custom designed a 60,277 square foot non-bonded distribution center for Continental Tire in the Minhang district of
southwest Shanghai and has occupied the new facility since September of 2007.
As part of its warehouse management functions, Penske Logistics engineered the optimal warehouse layout and stock placement strategy for
an average inventory of approximately 55,000 passenger vehicle tires representing over 100 stock keeping units (SKUs). Penske Logistics staff of
15 utilizes Continental's SAP information system for inventory management, warehouse order picking and putaway.
It also performs inbound and outbound transportation planning and order fulfillment of approximately 8,000 to 10,000 tires per week
destined to Continental's Chinese dealer network.
Waigaoqiao Multi-Client Logistics Center
A short drive from downtown Shanghai is the Waigaoqiao free trade zone (FTZ) and ocean shipping port. Penske Logistics runs a 12,960
square foot bonded logistics center managing customers' import/export, customs brokerage, and short-term storage activities. Customers such
as Sandvik and Amcor are supported by a staff of 12.
Most products handled at the center are imported goods being distributed within China. Penske Logistics has permission to use the Chinese
government's customs information system to track inbound product through customs clearance. Its staff notifies customers of product
movement and final clearance. In addition, they prepare the necessary documentation for domestic distribution. It takes approximately 24 hours
to clear Waigaoqiao customs.
To support its logistics center operations, Penske Logistics utilizes the popular Chinese warehouse management system (WMS) "Flux WMS".
Flux provides good warehouse management and inventory control functionality, can support radio frequency devices for picking and putaway,
and can be integrated with most major enterprise resource planning systems such as SAP. Penske Logistics is currently running an RFID active
pallet tag test using Flux for GE.
Summary
Penske Logistics is leveraging its multinational customer base and expanding local expertise to grow its operations in China. It has
successfully positioned the company as both a "China Gateway" for U.S. and European customers moving material and product in and out of
China and as an established domestic China 3PL managing internal transportation, providing warehousing and distribution, and supporting
plants with its tier-one inbound logistics services. Paired with the alliance air and sea transportation services Penske offers with ABX Logistics,
customers can benefit from a full range of 3PL value-added services. In the near future, as it links China with other regions through its global
transportation management platform, true event management via a single portal or system will be possible. As the domestic Chinese contract
logistics market develops, we anticipate that Penske Logistics will have a solid network in place to address the needs of both multinational
customers and domestic Chinese shippers.
Penske Logistics Leverages Local Expertise in Expanding Brazilian Operations
http://www.3plogistics.com/Penske_Brazil_2007.htm]
Sao Paulo, Brazil - Site Visits
January 15 & 16, 2007
Key Personnel:
Joseph Gallick, Senior Vice President of Sales
Gary Franz, Managing Director - South America Region
Mohamed Nassif, Operations & IT Director - South America Region
Paulo Monteiro, Finance Director - South America Region
Paulo Sarti, Director of Sales - South America Region
A myriad of taxes, import/export regulations, high interest rates, infrastructure and geographic constraints, language barriers, and security
issues make Brazil a challenging country for supply chain managers. These challenges often make it imperative for global companies distributing
products in Brazil to have a strong logistics partner.
To meet the needs of its global customer Ford Motor, Penske Logistics established its Brazilian operations in 1998 by investing in a joint
venture with Cotia Trading company. In August of 2005 Penske Logistics bought out the remaining interest in Cotia Penske Logistics and
formed a wholly-owned company. In a market that is just starting to embrace logistics outsourcing, Penske has leveraged its local staff with
Brazilian market expertise to grow revenues from $25 million in 1998 to $65 million in 2006. It currently has an approximate staff of 1,200
associates and 1.8 million square feet of warehouse space primarily serving the needs of 14 major customers. Top Brazilian customers include:
Ford, HP, Ingersoll Rand, General Motors, Lexmark, Officer, Samsung, Sony, Terra, and Tyco.
A good example illustrating Brazil's logistics challenges are Samsung's outbound distribution operations. To meet the demands of the
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Brazilian market, Samsung has built manufacturing plants in Campinas (just outside of Sao Paulo) and in the north central city of Manaus.
Manaus is a targeted growth city developed out of the Amazon rainforest by the Brazilian government. Because of its location and the need to
transport products via the Amazon river before being transloaded into trucks, the transit time from Manaus to Sao Paulo (Brazil's largest city) is
12 days.
Sao Paulo Samsung Warehouse
Penske manages the majority of Samsung's Brazilian distribution operations including a 120,000 square foot warehouse adjacent to its
headquarters in Barueri-Sao Paulo. Approximately 1,200 stock keeping units (SKUs) are maintained in on-hand inventory for same-day order
fulfillment. Security is very tight since high-value products stored include: large flat-panel televisions, computer monitors and appliances.
Approximately 30,000 pieces are received from Manaus and 100,000 pieces are received from overseas operations each year. Penske's systems
automatically schedule receiving dock doors. Inbound product quantities are verified, barcoded and if necessary serial numbers are scanned in by
Penske personnel prior to being directed for putaway by Penske's warehouse management system (WMS). Penske's facility is very modern and
all activities are driven by its WMS via radio frequency (RF) devices.
Product is stored in five position racking with the fastest moving items stored on the floor closer to the outbound shipping doors. Picking is
RF driven and is typically done in waves, routes, or by final customer. Penske performs continuous cycle counting and reconciles Samsung's
inventory each day. Inventory accuracy has been running at 99.7% and inventory turns 1.5 times per month.
During Samsung's peak season from August through December, approximately 400 outbound orders are filled per day. Outbound
transportation is managed using Penske's proprietary "e-cargo" transportation management system (TMS). In addition to warehousing and
distribution, Penske is also performing repair and refurbishment work for Samsung. This includes performing returns processing, product
quality checks and basic refurbishment and repackaging. Samsung's Brazilian customers include retailers: Casas Bahia, Carrefour, Po de Acar,
and Wal-Mart.
Sao Paulo Multi-Client Warehouse (MCW)
A short drive from Penske Logistics Brazilian headquarters, is its very secure 250,000 square foot multi-client warehouse. Having an
approximate workforce of 350 the MCW utilizes Penske's proprietary TMS and WMS and with integrated RF interfaces to manage logistics
functions.
Penske runs a sizable aftermarket spare/service parts kitting and fulfillment operation for GM's Brazilian car dealer distribution network. The
operation is staffed by 150 workers in three shifts occupying 60,000 square feet of space.
Each month approximately 2.1 million parts are picked, packed and shipped to dealers and GM's regional parts distribution centers. Many of
the shipments require significant transportation management with same-day or specific delivery window requirements.
Lexmark is another
large MCW customer and has grown with Penske since its operation startup in 2004. It occupies 53,800 square feet. A staff of 45 associates are
responsible for receiving inbound product, performing product customization, warehouse management, outbound distribution, and reverse
logistics services. An example of one value-added service being provided is special ink jet labeling for the Brazilian market. Penske manages
approximately 3,000 outbound loads per month for Lexmark.
Sony Style's Brazilian business to consumer internet order fulfillment operation operates in a fenced off 35,000 square foot section of the
warehouse. Approximately, 250 orders for everything from large screen high definition televisions to accessories are processed each month.
Sony's enterprise resource planning (ERP) system has been integrated with Penske's WMS to efficiently manage warehouse activities. In addition
to order fulfillment, Penske provides Sony with full outbound transportation management services. Approximately half of the outbound orders
are LTL (less than truckload) and half are FTL (full truckload).
Penske is a primary 3PL for Brazilian headquartered Officer Distribuidora a wholesaler of IT equipment and software. Officer has a branch
office located in the MCW and is directly integrated with Penske's WMS for order picking and outbound fulfillment.
The final MCW customer operation we viewed was for Terra, an online business selling caller identification equipment, modems, cable
television converters, and other electronics. It occupies approximately 30,000 square feet of the MCW and utilizes Penske's "Logix" ERP system
for order fulfillment and customer invoicing.
Ford Parts Distribution Center Operations
Penske Logistics manages two aftermarket automotive parts distribution centers (PDCs) for Ford in Brazil; one is in the Northeast and the
second one which we toured is in Sao Paulo. With an approximate dealer network of 500, both operations require top-notch integrated valueadded warehousing and transportation management capabilities.
The 387,000 square foot dedicated Sao Paulo Ford PDC began operations in 1999 and is staffed by 220 Penske associates. Inbound parts are
received from Ford's manufacturing plants and suppliers. Inventory consists of approximately 47,000 SKUs and 10 million items stored in over
81,000 warehouse locations. Penske's key performance indicators include a minimum order fill rate of 97% and 99.6% inventory accuracy.
Penske has been running at 99.9% inventory accuracy.
To increase operational efficiency, Penske developed four 12 meter high vertical carousel sorters for picking fast moving items. Each
individual sorter contains 82 shelves and can quickly process hundreds of orders at the same time.
Outbound parts orders are received from Ford's dealer network and Penske picks, packs, and ships the orders. Delivery requirements are
stringent. Orders received by 2 P.M. must be shipped that day and those received by 6 P.M. for Sao Paulo dealers must be delivered by Penske
that evening. All other orders must be delivered within 48 hours of order receipt.
Transportation Management System - "e-cargo"
To tackle the distinct needs of managing transportation in Brazil, Penske Logistics uses its proprietary transportation management system
(TMS) dubbed "e-cargo". While Penske uses i2 for TMS in the U.S., e-cargo has been developed to handle four federal Brazilian taxes,
individual state taxes, and a tax imposed on each transportation invoice.
e-cargo runs as an ASP web application via sequel server (SQL) on an Oracle database. Overall transportation execution functionality is very
robust. Orders are received from customers via EDI interfaces directly into e-cargo. The system in-turn facilities optimal routing, carrier
selection, rates shipments and drives picking on the warehouse floor. e-cargo has templates for automatically preparing bills of ladings. Once
shipments are in transit, e-cargo offers solid internet tracking and tracing capabilities via communications with carrier global positioning systems
(GPS) or through "check" calls to Penske's central transportation management call center. This shipment visibility provides Penske with vital
information to insure high-value loads are secure.
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Summary
By leveraging its local expertise and inherent skills as an automotive logistics leader, Penske is growing its presence amongst high-tech
industry customers in Brazil. We anticipate that Penske Logistics will continue its global expansion by developing solid integrated warehousing
and transportation management operations in high-tech and other select verticals.
Penske Logistics wins new Ford contract
Penske Logistics has won additional business with Ford Motor Company by being selected as a logistics provider at Ford's Dearborn Truck
Plant in Dearborn, Mich., where the popular F-Series trucks are assembled.
Penske Logistics will provide manufacturing support services for Ford including sequencing, metering, repack, small-lot, and containermanagement services.
"Ford Motor Company is a longstanding and valued customer," said Penske Logistics President Vince Hartnett. "We're pleased to serve their
needs in this new capacity."
Penske Logistics is a strategic supplier to Ford and is part of its Aligned Business Framework. Penske performs lead logistics, as well as,
manufacturing support, dealer delivery, in-plant, material handling, warehouse and transportation management services across Ford product lines
in the U.S., Canada, U.K., and Brazil.
Readers Choice Top 10 3PL Excellence Awards 2010
#9 Penske Logistics
WHY THEY WON: Penske Logistics places a relentless focus on the customer experience and value creation, says Vince Hartnett,
president, Penske Logistics.
"Relationship and goal alignment are key elements because we work very closely with our customers at all levels to ascertain both their shortterm and long-term strategic direction."
Reader comments support Hartnett's assertions about Penske's approach. "They go above and beyond and treat our business like their own,"
says one shipper. "Penske Logistics works hard to understand our company's needs and business model," says another. A third praises Penske
Logistics' "best-in-class solutions and people."
Offering shippers the services they need is a priority for the Reading, Pa.-based 3PL. Penske Logistics took a focused look at each of our
product lines to ensure that the services we offer provided the most value, says Hartnett. We aligned our business operations with the
respective product lines. For example, Penske recently launched a new labor management program designed to streamline warehouse efficiency,
and reduce waste and cost within the customers supply chain. As a result of this successful implementation, some of our customers have
experienced 15- to 25-percent productivity gains in a three- to four-month period."
CASE STUDY: Cardinal Health
Penske Logistics and global healthcare manufacturer and distributor Cardinal Health have been working together for more than 20 years.
Since 2008, Penske Logistics has managed dedicated contract carriage services for Cardinal Health's medical products; distribution business,
which serves hospitals, clinics, surgery centers, labs, and physician's offices. Over the past two years, Cardinal Health outsourced the
management of its private fleet to Penske Logistics.
Today, they're focused on improving outbound distribution network and transportation efficiency, while maintaining a close eye on the
critical nature of service required to support healthcare customers. Initial results show fleet utilization has increased, vehicle fuel efficiency has
improved, empty miles/backhauls have decreased, and additional synergies have been created with key suppliers.
3PL Slowdown Goes Global
China bucks global trend of lower growth forecasts for Asian, European and Latin American 3PLs
Like their counterparts in the U.S., third-party logistics providers in Europe, Asia-Pacific and Latin America enter 2010 with lower growth
expectations.
European and Asia-Pacific 3PLs that reported layoffs in 2009 averaged work force reductions of 12 and 9 percent, respectively.
Three-year growth forecasts for regional European 3PL markets have shrunk from 6.5 percent in 2008 to 4.9 percent this year, according to
the 2009 14th Annual Third-Party Logistics Study, released by Capgemini Consulting and the Georgia Institute of Technology.
Company growth projections for the three-year period fell from 10 percent to 8.7 percent.
For Asia-Pacific 3PLs, three-year growth projections fell from 23 percent in 2008 to 16.7 percent in 2009.
Amid the gloom, there are positive signs. Shippers in Europe, the Asia-Pacific and Latin America spend a higher percentage of their logistics
budgets 66, 62 and 51 percent, respectively on outsourced logistics than North American shippers 47 percent.
3PLs in all the regions can expect to capture a bigger share of overall logistics spending. Expenditures on outsourcing as a percentage of total
logistics costs are expected to rise to 72 percent in Europe by 2011 and 74 percent by 2014. In the Asia-Pacific, expenditures on outsourcing as a
percentage of total logistics costs are forecast to grow to 65 percent by 2011 and 70 percent by 2014; and in Latin America, 55 and 60 percent,
respectively.
In Latin America, the percentage of shippers who use 3PL-provided freight billing and auditing services doubled last year from 2008, to 28
percent.
Logistics is a key industry cluster in Chinas long-term ongoing economic development plans. The sector has grown by an average 14 percent
annually for most of the past decade, according to the China Federation of Logistics and Purchasing.
According to a January report in the China Daily, the National Development and Reform Commission reported total revenue from the nation
s logistics industries grew 20 percent year-over-year in the first nine months of 2009.
With a 40 percent annual growth rate in demand for time-definite logistics services, there are huge opportunities for foreign and domestic
3PLs in China, said Nicholas Pechet, vice president and head of China operations for Global Intelligence Alliance, a Helsinki, Finland-based
strategic consulting group.
Foreign 3PLs with carefully crafted strategies can succeed in Chinas highly fragmented market. In the past decade, foreign 3PLs have
18th Edition
captured nearly 80 percent of the nations time-sensitive export logistics business, Pechet said at the December 2009 opening of Shanghai-based
Huier Logistics logistics park in Qingpu, near Shanghai.
Penske Logistics is one of the success stories. The company operates in 15 Chinese cities, providing services to more than a dozen
customers, said Angela Yang, managing director, Asia-Pacific. Penske operates about 240,000 square feet of warehousing space in China and
handles approximately 2,500 annual TEUs.
Challenges include evolving standards for trucks, regulations for domestic transportation and toll-fee structures that vary from province to
province.
New customers entering or expanding in the Chinese and Asian markets are seeking cultural fits and consistent service levels across the
globe, Yang said.
According to Chinas State Administration for Industry and Commerce, there are more than 700,000 registered logistics companies in the
country. Cosco Logistics, which had the highest annual revenue in the industry, equal to around $17 billion, accounted for less than 3 percent of
the nations total logistics market.
Logistics costs, including transportation, storage and management account for 18.3 percent of the nations GDP, according to Chinas 11th
Five-Year Plan approximately twice as much as in the U.S. and European Union.
The high costs are driven by fragmentation, rising fuel costs and a lack of supply chain expertise among tens of thousands of export-oriented
companies that expanded rapidly during the past 20 years. In a 2009 survey of 100 Chinese exporters in six major industries, 80 percent reported
being unsatisfied with their ability to meet the basic service demands of their overseas customers, such as on-time and accurate product delivery.
They also report low levels of collaboration with suppliers and customers.
The study was conducted by global management consultants A.T. Kearney and the Chair of Global Supply Chain Management at Tongji
University, Shanghai.
Logistics costs are even higher in Latin America, ranging from 18 to 34 percent of product value, compared with a 9 percent average for the
30-plus members of the Organization for Economic Cooperation and development, according to the World Bank.
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630-766-6395
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1979
Asset Focus:
Market Area:
Founding Business:
International
Int'l Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Stephane Rambaud
Drew Felling
Mike Short
VP Marketing
VP North America
Emil Sanchez
Shanna Miller
CFO
VP IS
733
Ticker Symbol
140 **
Exchange:
1,900
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): FastTrack
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
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DCS
FastTrack
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Specialty Retailers
Bridgestone
Pampered Chef
Specialty Retailers
Ty, Inc.
Whitney Design
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Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Europe
North America
Latin/South America
Bangladesh
Australia
Austria
Canada
Isreal
Jordan
China
New Zealand
Belgium
Mexico
Hong Kong
Tahiti
Bosnia
United States
Argentina
Bolivia
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Honduras
Panama
Paraguay
Peru
Puerto Rico
Uruguay
Venezuela
Kuwait
Australia/New Zealand
Phoenix
Bahrain
Africa/Middle East
Asia/Pacific
Croatia
India
Lebanon
Czech Republic
Indonesia
Oman
Qatar
Saudi Arabia
Japan
Malaysia
Yemen
Pakistan
Denmark
Estonia
Korea
Finland
France
Germany
Philippines
Greece
Singapore
Holland
Sri Lanka
Hungary
Taiwan
Ireland
Thailand
Italy
Vietnam
Latvia
Lithuania
Norway
Poland
Portugal
Romania
Russia
Serbia
Slovakia
Slovenia
Spain
Sweden
Switzerland
Turkey
United Kingdom
EDITOR'S COMMENTS
Phoenix International is an aggressive freight forwarder, NVOCC and customs broker. It handled 200,000 TEUs
and 46,266 airfreight tonnes in 2009. It has 73 owned offices. FMC license number is 2431F. Customs Filer Code
is 279. Phoenix has 44 licensed Customs brokers throughout the U.S.
The Phoenix in-house operating system in the U.S. runs on an AS400. Phoenix is developing a new Javabased system, Pixos, to cover all functions. Much of the development work is being done in China where Phoenix
has an IT staff of 50. Phoenix maintains a transparent, teamwork approach. Fifty personnel are actively involved
in sales. Its strongest verticals are in retail and FMCG including housewares. Rambaud is a quality operator.
Provider's Strengths
Quality, international freight forwarding.
Provider's Weaknesses
were 180,000 TEUs (twenty foot equivalent units) and 50,000 tons of airfreight.
Overseas, the major international operations are in China (16 offices), India (12 offices) and the UK (5 offices). Rambaud and his VPs are
now moving to further develop Latin America.
Specializations include vendor managed inventory (VMI) from Chinese sourcing/part locations and garment on hanger (GOH) moves to the
US and UK. Phoenix also has the largest freight forwarding operation in St. Louis (120 employees), a significant presence in Springfield, MO
and a large office in Kansas City as part of a strong Midwestern US concentration.
Not only has Phoenix expanded in Tier 2 sized American cities, it has built its business on medium-sized clients. The Phoenix corporate
culture is a nice match for these companies. At the same time, Phoenixs customer base stays very diversified. The top 20 accounts provide only
15% of the companys gross profits.
A major service for Phoenix is LCL (less than container load) consolidation. Phoenix handles purchase orders and regularly direct loads to
specific destinations bypassing intervening distribution centers. Value-added services are provided for total supply chain management.
Rambauds family was involved in the international shipping industry in France before World War II. Stephane immigrated to the US in
1985 and he has been working at Phoenix for 23 years. He is a very experienced, bi-cultural 44 year old ready to move Phoenix into the big time.
Phoenix Announces New Vice President of North America
Wood Dale, Illinois January 20, 2010 Phoenix International Freight Services, Limited is pleased to announce the promotion of Mike
Short to the newly-created position of Vice President, North America.
Short joined the company in 1999 as the St. Louis branch sales manager, and steadily advanced to the positions of St. Louis general manager,
central regional manager, and now vice president of North America.
Mike took over from me our second largest-producing branch in 2001, and doubled its size; generating $60 million in new revenue while
increasing the staff from 40 to 150, said president and chief executive officer Stephane Rambaud. Rambaud opened St. Louis in 1988 as the
companys fourth location. In his new position Mike will use his proven expertise to further the continued growth of Phoenixs 24 U.S. offices.
Shorts accomplishments also include successful branch startups and consistently hiring and developing many of the companys topproducing sales representatives.
First move will be to analyze current business practices to help our branch managers better craft optimal solutions designed to surpass
customer needs; while ideally also bolstering work environments leading to increased productivity, said Short.
French Forwarding Familys Tradition Continues on Native Soil
Wood Dale, Illinois May 29, 2009 Phoenix International Freight Services, Limiteds office debut in Paris this past March was a
homecoming of sorts for the companys President & CEO, Stephane Rambaud.
Since our companys inception in 1979, Phoenix International has been represented in the French market by exclusive agent partners. I am
very pleased to announce the opening of our own office in France. The fact I happen to be a native of France, and that my family has a rich
heritage in our industry in France, have little to do with the opening of our 74th office. What is a key factor is the need to provide our global
network and clients with a stronger and more dedicated presence in a market as important as France, said Rambaud.
Rambauds grandfather, Paul Rambaud, founded a cartage company in Paris in 1931, and Rambauds parents, Daniel and Anne Rambaud,
took over the business in the 50s until Rambaud International was sold in 1998.
Many of you have come to rely on and appreciate our proven weekly ocean consolidations, FCL service, and multiple weekly airfreight
consolidations to and from France. Knowing that your needs continue to grow and require more sophisticated supply chain integrity, visibility,
compliance and security, our office staff and service offerings in France have been chosen to serve you well, explains Rambaud.
Phoenix France will be managed by Christophe Bedin who brings more than twenty years of market and industry experience to the latest
Phoenix venture.
You can reach Bedin and his staff at:
Bat 4 Sogaris, Fret 5, 14 rue de la Belle Borne
BP 18371 Tremblay En France
95706 Roissy CDG Cedex
Tel: 33.1.48.64.86.17
Mail: cbedin@phoenixintl.fr
AN EXCITING PERIOD OF CHANGE
[By Stephane Rambaud, President and CEO, Phoenix Flier, March 2008]
After being CEO for more than half a year, I am happy to report that I have not yet lost my sanity, our people have not gone on strike, and
we are still in business! That is pretty good news.
It has actually been a very exciting period, one of many changes. But I hear that is what people are seeking these days: change. With respect
to management, change is good, but only within reason. Most of us are creatures of habit, and stability in management is equally as important as
the change that a stable management team can generate. As early as July, I spoke about delegating and going forward as a team; I said together,
we can do anything. And we have done a lot.
Halfway through our fiscal year we are up 13 percent in revenues, gross profit, and net income. Our regional managers have gotten used to
working closely with the GMs who lead and build their newly designed regions. Some have made management changes, others are focusing
more on sales growth, and still others are cleaning up operational issues.
Now that sales revenues are approaching $800 million, our pattern of averaging 20 percent annual increases will likely abate, but efforts to
review and improve areas of our company will ensure that prosperity will continue for many years to come.
Since late summer, PIX Line has seen changes in management, staffing, choice of carriers, and pricing structure. It is a more dynamic, branchfocused, and sales-driven entity. LCL export is a very important part of our fiber as a company and a product we will focus on more in the
months ahead. Thank you, Ursula Borzym and your team.
The growth potential for air import business from Asia is a topic that caught our attention at the last management meeting, and since then
we carefully reviewed and revised our program. We now have the proper vehicle in Asia to propel us to new heights, a dynamic pricing structure
and a gateway network providing coverage from Taiwan to northern China. By combining cargo, resources, and knowledge we have been able to
secure enormous shipments and offer services comparable with major market players. Rick Mettetal, Steven Tu, and Sky Chang have done a
great job putting this together. Thanks, guys!
Another exciting project that has been in the works for some time will have come to fruition by this articles distribution date, and that is our
18th Edition
Vendor Management Services program. Our Information Systems teams in Chicago and Shanghai invested considerable time and energy into
making this our lethal supply chain weapon. Shanna Miller, Tony Liu, Laura Peacock, and their respective teams deserve thanks and gratitude
for a job well done.
In early December we expanded our presence in Miami to a full-service branch, and have since opened two more: Nashville, TN, in Jack
Fleischmans region; and Springfield, MO, in Mike Shorts territory. Look for more about these new additions in the next edition of the Flier.
A few weeks ago I mentioned to our U.S. employees that Latin America is to be a future market focus for Phoenix. For months we have
been planning a return enforce in LATAM. Having learned lessons from our previous endeavor there, we expect our entre into this market to
be very successful. Rather than opening an office, our new approach involves people and partners with great experience in that part of the
world, and will soon be unveiled for you. I would like to thank Tom Sweet, without whom this could never have happened. He worked very
closely with Jack Fleischman and Avelino Garcia, and the three of them turned out to be a great team. Thank you.
PHOENIX TEAMS WITH ITATRANS FOR GLOBAL EXPANSION
Phoenix Flier, March 2008]
In accordance with our plan to develop business in South America, Phoenix International has signed a definitive agreement with Itatrans, a
freight forwarding company in Brazil. Phoenix and Itatrans will represent each other in their respective markets Itatrans will act as Phoenixs
agent in Brazil, and Phoenix will be Itatrans agent in the USA, UK, and Asia.
In January, I traveled with Ricardo Sapag (president of Itatrans) and Olivier Arnaudeau (director of Asia development, Corporate) to visit
five of our branch offices in Asia: Shanghai, Shenzen, Qingdo, Hong Kong, and Taiwan. One of the primary purposes of our trip was to work
on Asia-to-Brazil integration issues.
Like Phoenix, Itatrans is a privately held, owner-operated company, and we share similar goals and philosophies.
Phoenix Launches Global Textile Division
Wood Dale, Illinois September 29, 2006 - Phoenix International has recognized a growing need to provide tailored services at every level of
the supply chain to the booming global Textile industry. Global Textile Logistics (GTL) is comprised of a team of people within our company
in the USA and around the world able to fully understand and focus on providing tailored services to the very time sensitive commodity group
of Textiles, said CEO Bill McInerney.
Phoenix, the largest privately owned international freight forwarder, NVOCC and Customs broker headquartered in North America, with
1400 employees in 65 global offices and sales exceeding $611 Million, also recently acquired a forwarding company with 14 offices in India and
opened a new branch office in Sri Lanka; a major sourcing market for the textile industry.
The Textile Industry is burdened by improper handling and delays. Producers and importers need logistics services which meet their
industry-specific needs freight, documentation, timely handling of goods, distribution, and efficient follow up. Customers are looking for
dedicated service people completely involved and knowledgeable about the industry of textile logistics, explains Phoenixs GTL Business
Development Manager Francois Wolberg.
We are able to offer full services to satisfy every level of the textile supply chain from the shipment of raw material to factory, to final
destination, to warehouses, and to pick & pack distribution to store shelves, said Wolberg.
Phoenix International expands into Indian subcontinent
Phoenix International Freight Services has opened thirteen new company offices located in India and Sri Lanka. This month, Phoenix
acquired the majority shares of Eastern Logistics in India, and opened an office in Colombo, Sri Lanka. (7/26/2006)
According to Phoenix founder & CEO Bill McInerney, the company expects these new offices to have a positive impact on the companys
ability to offer its clients superior and enhanced services to and from the Indian subcontinent.
Our global organisation just received a very powerfully positive influx of talent and expertise; the future is surely bright for Phoenix and our
clients, he remarked.
Phoenix is a financially and operationally strong company, with a global network of 275 locations in 100 countries. Since it was established in
Chicago in 1979, its has grown to a global operation generating sales revenue exceeding $500 million.
McInerney commented that ensuring a strong presence in the Indian subcontinent is vital to steady company growth. Our success in
developing offices in China has been instrumental in the companys recent progress. Eastern Logistics standing as a premier freight forwarding
company with a national network in India provides us with a powerful presence in one of the most exciting and emerging global markets.
18th Edition
sales@ptclogistics.com.sg
65-6264 3394
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1950
Asset Focus:
Market Area:
Founding Business:
Singapore
Owner-operator Transport
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Poh Choon Ann
72
72 **
Exchange:
723
SIN
ASSETS
Total Transportation Assets:
Total Tractors:
206
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
1,470
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i-Transport/I FMS
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i-WMS (EXE)
18th Edition
AIMS
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Chemicals
Singapore
Chemicals
Singapore
Mitsubishi Chemical
Chemicals
Singapore
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Singapore
EDITOR'S COMMENTS
Major capabilities are in drumming chemicals, chemicals distribution, bulk commodities and trucking.
Transportation and Bulk Cargo is its largest business segment generating 82% of total revenue for 2009.
Provider's Strengths
Chemicals niche.
Provider's Weaknesses
Limited geographical and product coverage.
18th Edition
55 81 3464-5210
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1942
Asset Focus:
Market Area:
Founding Business:
Brazil
Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Amrico Pereira
CEO
Sales Director
Logistics Director
Sebastio Marinho
Rafael Mansilha
CFO
CTO
307
Ticker Symbol
307 **
Exchange:
6,500
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
6.5
Total Other:
Total Trailers:
Total Aircraft:
30
750
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
1,750
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Infor
18th Edition
Proprietary
Oracle
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Dell
Brazil
Natura
Brazil
Oi
Telecommunications
Brazil
Scania
Brazil
Vale
Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Rapidao Cometa
Latin/South America
Brazil
EDITOR'S COMMENTS
Rapido Cometa is the second largest domestic transportation company in Brazil. It has 33 branch offices in
Brazil specializing in road transportation, specialized pharmaceutical services, and home delivery. Rapido
Cometa has more than 12,000 active customers and more than 7 million deliveries are made each year. It has a
fleet of 750 trucks and 1,750 light vehicles and motorbikes. Its international shipments are handled through an
agreement with FedEx.
Provider's Strengths
Domestic transportation.
Provider's Weaknesses
Rapido Cometa starts investing R$ 5.5 million (US$ 3.5 million) in the purchase of 37 new trucks that will be added to the 2,400 vehicle fleet
of the company, one of the largest ones in Brazil in the areas of transportation and logistics. Among the new vehicles there are light, heavy, semiheavy and extra-heavy trucks that will be employed in the new strategy to comply with the restriction of trucks in So Paulo. The Operating
Officer of Rapido Cometa, Manoel Leite, declares the operating costs have increased 12% in So Paulo - which is responsible for 30% of the
volume of cargo shipped by the company. "With the increase of the perimeter to 100 kilometers, time got shorter and we had to hire more
people", he explains, saying it was necessary to reallocate five trucks from the routes and leave a large tractor trailer in the Ipiranga area to be
loaded during the day by the utility vehicles, to keep the same routes. Among the new acquisitions there are five Daily, from Iveco, for cargo
distribution inside urban areas. The operations in Campinas will receive six trucks, of the Atego semi-heavy line, with capacity for 16 tons; and
one of the three tractor trailers, from the Axor line of extra-heavy trucks for up to 24 tons with semi-trailer, both from Mercedes-Benz. The
focus of the business is the collection of the cargo from the South and Southeast for distribution in the North and Northeast. The operation will
be strengthened by the increase of the Guarulhos and Manaus terminals. In the first one, to be opened in September, R$ 30 million (US$ 19.1
million) was invested together with a partner from So Paulo. Installed in a lot with 67 thousand square meters, the terminal will have its built
area doubled, reaching 22 thousand square meters. The terminal of Manaus will become bigger, with 26 thousand square meters of built area,
but at a much lower cost due to the characteristics of the project. It will be ready until December and will consume between R$ 15 million (US$
18th Edition
9.6 million) and R$ 20 million (US$ 12.7 million). Every new investment leads to the creation of at least 150 new job positions, and that already
causes the company to have 6,400 employees working in three shifts, in the 37 branch offices and 170 distribution offices. With the distribution
concentrated in the capital cities of Pernambuco, Cear, Bahia, and Par, Rapido Cometa reaches 4 thousand Brazilian cities and handles 50
thousand tons of cargo a month in shipment and distribution. That means nearly R$ 2 billion (US$ 1.3 billion) in goods, mainly retail products
in the segments of telephone, electrical and electronic devices, footwear and medicines. "We have a project to operate with distribution to the
south and southeast as well and, after 2009, we will decide about new routes", says the Operating Officer.
DETERMINANTS OF CUSTOMER PARTNERING BEHAVIOR IN LOGISTICS OUTSOURCING RELATIONSHIPS: A
RELATIONSHIP MARKETING PERSPECTIVE [By Adriana Rossiter Hofer, April 24, 2007]
Increasing customer trust in a 3PLIt is crucial for a 3PL representative to make an effort to develop personal and interactive relationships
with its customers. Personal relationships may be emphasized in many areas of a 3PLs activities, including those that deal with customer issues
or complaints (e.g., the marketing department and call-center). Several semi-structured interviews were conducted with Rapido Cometas
customers. During the interviews, it was emphasized how important the weekly visits from Rapido Cometas representatives were for the
customers. The customers argued that Rapido Cometa was responsive when problems arose, such as late shipments. They pointed out that it
was important to know that someone from Rapido Cometa was paying attention to their problems and working to solve them.
Aside from working on interpersonal interactions with customers, one way to increase a customers perception of a 3PLs benevolence is by
investing in the relationship. It was shown that there is a positive relationship between 3PL transaction-specific investments and 3PL
benevolence. Transaction specific investments are a demonstration of concern and care for the relationship. Therefore, if a 3PL invests in the
relationship with a customer, the customer will not only perceive itself to be dependent on the 3PL, but will also trust the 3PL.
An important means of increasing a customers perception of a 3PLs credibility is by increasing the 3PLs reputation. A positive relationship
was found between a 3PLs reputation and its customers perception of the 3PLs credibility. Reputational advertising may help here. In addition,
reputation may spread through word-of-mouth. One of the customers interviewed said that his company chose Rapido Cometa based on
conversations with managers from other firms who already worked with Rapido Cometa.
Finally, it is crucial that a customer is satisfied with the services provided. The model results show that satisfaction with outcomes of the
relationship build trust that in turn shapes a customers partnering behavior with a 3PL. During the interviews, on-time performance, freight
visibility through a satellite tracking system, and cargo integrity (i.e., absence of damage and spoilage) were clearly the main factors that
customers used to evaluate Rapido Cometas performance.
18th Edition
52 55 5278 8360
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1991
Asset Focus:
Market Area:
Founding Business:
Mexico
Package delivery
Redpack TNT
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Francisco Rodrguez Chapa CEO
Sonia Bracamontes
Francisco J. Chapa
Marketing Mgr.
CEO, Redpack USA
Administration Mgr.
53
Ticker Symbol
53 **
Exchange:
300
30
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
1,500
Total Other:
Total Reefers:
Total Flatbeds:
0.08
10
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Healthcare
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Cognos
Proprietary
Radar
SAP
SAP
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Casa Saba
Mexico
CompuSoluciones
Guadalajara
Litoformas
Publishing, Printing
Mexico
MercadoLibre
Mexico
Perfumes Mxico
Mexico
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Australia/New Zealand
Europe
North America
Redpack
Latin/South America
Mexico
United States
EDITOR'S COMMENTS
Redpack is known as one of the largest courier package delivery companies in Mexico. It delivers 30,000
packages daily servicing 850 points throughout Mexico. It currently has 193 offices throughout Mexico and recently
opened an office in Laredo, Texas. Destinations outside of Mexico are served through an alliances with UPS and
TNT.
Provider's Strengths
Courier package delivery.
Provider's Weaknesses
Scope of services.
TNT has stepped up its presence in the Mexican express market through an alliance with leading player Redpack, local media reported.
TNT is investing $1 million into a three-year strategic and commercial cooperation with Redpack in order to target import and export
shipments to and from Mexico, the two companies announced at a press conference last week.
The two companies plan to speed up domestic and international deliveries to between 24 and 48 hours respectively. TNT is handling the
international shipments of Redpacks customers, while the Mexican firm is providing nationwide delivery of TNT shipments to Mexico.
Redpack, founded in 1991, is the second-largest domestic express and parcels carrier in Mexico. It serves 850 destinations across the country
via 32 air routes and with a fleet of more than 1,000 delivery vehicles, 1,300 staff and some 320 sales outlets. In 2008, it transported more than
six million shipments and generated revenues of over $40 million.
Redpack managing director Francisco Rodrguez Chapa said at the news conference that the two companies would align their processes,
capacity and IT systems as part of the cooperation. There will also be training for Mexican staff to ensure they provide services at TNTs
performance levels.
TNT regional director for Latin America, Helmer Knust, explained that the Dutch group is targeting emerging markets as part of its overall
strategy. Redpack and TNT are teaming up to increase the penetration of the Mexican international express market, working together and
uniting forces to provide better competitiveness, and offering a first-class, flexible service, he declared.
Delivering the Goods
A homegrown company with a unique model and national coverage, MEXICOs Redpack is one of the top 10 delivery companies in the
country. With 30,000 packages moving through its doors on a daily basis, Redpack has grown tremendously since it started as a network of
delivery men only a decade ago. Peter Krupa reports.
The problem was a complex one: how to build a domestic company that is capable of delivering packages to all corners of Mexicos 32 states,
inhabited by 100 million people, many living in lightly populated areas with few roads? The network would have to cover everywhere from the
jungles of Oaxaca to the northern plains, and in the early 1990s, building such a company probably sounded a little crazy.
But crazy or not at the time, history certainly absolves the founders of Redpack, a company that today presides over the delivery of 30,000
packages and envelopes per day to 850 destinations in Mexico and tens of thousands more around the world through the companys strategic
alliances. Though the problem of building such a network may have been complex, the solution was, if not simple, elegant: bring together all the
existing delivery companies in the country into a unified network under a single brand.
Like a co-op for delivery people, Redpack has continued to grow and today operates huge urban hubs and the latest in cutting-edge electronic
tracking. This year, the company is expanding its shipping options to include light cargo, as well as aggressively pursuing a greater slice of
international shipping to Mexicos northern neighbors, the United States and Canada.
FROM NORTH TO SOUTH
Redpack today is one of the largest delivery companies in Mexico. The company delivers to 853 destinations, as well as innumerable
destinations abroad in 210 countries through its alliance with UPS. The company operates out of 193 offices around the country, and its many
Internet and phone connected sites means that the status of all the packages is tracked in real time. The company covers 500,000 km of ground
routes with 1,500 vehicles, as well as 30 commercial air routes with two cargo planes.
With 100 percent Mexican capital, Redpack has grown to take up a place in the top 10 delivery companies in the country. Everyday, the
company handles 30,000 packages and envelopes, with an installed capacity to handle 80 metric tons daily. The company even has the
connections now to ship to 35,000 destinations in the U.S. and Canada in short, Redpack can deliver from Saskatchewan to the Yucatan.
Were still working the way we started, said sales and marketing director Sonia Bracamontes, just on a higher level.
EVOLUTION
Of course, that doesnt mean that Redpack has picked up concessionaires in Toronto. As the company has grown, it has taken on more of
the characteristics of a traditional delivery company. For example, since its founding, Redpack has bought out 50 percent of its concessionaires
and now owns outright those smaller service providers. Its not that Redpack is intentionally seeking to buy out its concessionaires,
18th Edition
Bracamontes said. Its more a matter that as Redpack grows, it needs to offer the face and the same quality of service to its customers no
matter where. If a concessionaire isnt keeping up with change, upgrading equipment, and offering good service, Redpack might step in.
In the beginning, (concessionaires) were the only way to grow, Bracamontes said.
But these days, Redpack is growing in all sorts of ways, for one by investing large amounts of capital to develop the infrastructure of a
traditional delivery company. Redpack now has major hubs in half a dozen Mexican cities. Bracamontes calculated that altogether, the companys
storage and shipping facilities amount to just under 30,000 square meters of space.
HIGH-TECH
The new growth also means Redpack has had to figure out new ways to handle the shear volume of material passing through its doors every
day. With a total of some eight million packages per year, thats no simple task. Fortunately, there are solutions. In the last few years Redpack
has invested several million dollars in new technology for its shipping centers, including 23 IBM servers, handheld computers, and scanners.
The new equipment means that, like any of its global shipping competitors, Redpack can keep instant track of where any package is at any
time. The new tech also makes it possible to extend an advantage it already had over the competition: customer service.
CRITICAL ADVANTAGES
Its an important point because the competition in the shipping industry is steep. Redpack has to compete with the likes of local providers
like Estafeta and Multipack, as well as transnationals like German shipping giant DHL. The new technology Redpack has installed means it can
communicate directly with its customers by making it possible to integrate its shipping system with that of its customers.
That can make a world of difference for Redpacks big clients in the automotive, publishing, and pharmaceutical industries.
We know just in time exactly when theyre needing to send things, Bracamontes explained, giving Redpack that hair-thin but crucial time
advantage over the competition.
Its not the only competitive advantage Redpack has either. Remember that at its heart, the company is still a network of guys on motorbikes,
fanning out across the country and delivering packages right to the doors of small businesses and individuals in obscure towns. Its a feat that a
German company like DHL cant hope to replicate.
We have a lot of regional expertise and we know the different cultures of the Mexican territory, Bracamontes said, adding: We still have
the advantage (over companies like DHL) in that we arrive to more destinations.
GROWTH EXPLOSION
Over the last three years, Redpack has grown a combined 20 percent, which Bracamontes called an explosion. Redpack has plans to
continue that which explosion on several fronts, with the goal of growing annually by five points above the growth of the market, which has
historically been between 2 and 9 percent.
They plan to continue that growth with a variety of initiatives. For one, there is Redpack USA Inc., the companys subsidiary located in
Laredo, Texas. Bracamontes sees in the U.S. an important niche market as more Mexican immigrants send packages back and forth across the
border and need to deal with things like customs requirements, or making sure important documents arrive safely. By next year, Bracamontes
expects Redpack USA Inc. to account for 10 percent of the companys sales.
Second, Redpack just this year expanded its shipping abilities to include light cargo pallets of materials weighing up to 400 kg. That will
appeal to the companys key customers in, for example, the publishing and autoparts businesses, as well as bring in some new ones.
QUALITY WITH THE QUANTITY
As Redpack continues to grow, it will also be focus on quality. The company already has ISO: 9000 certification, and last year it won the
National Safety Award from the National Private Transportation Association. Redpack, however, is going further. Each of the companys four
management zones will this year beat the bushes to find and eliminate any shipping or service problems the company has seen.
Were trying to lower mistakes more and more (every year), Bracamontes said.
Quality of the product isnt the only thing Redpack is trying to improve either. By next year, the company will have qualified with the
Mexican government as a socially sustainable company, a certification that takes into account quality of life of employees, links with the
community, and environmentally and socially safe practices.
Its a new movement in Mexico, Bracamontes explained, and a perfect fit for an innovative company like Redpack.
18th Edition
852-2764-2429
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1975
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Calvin Ng
Chairman
Alex Leung
Ricky Leung
Annie Luk
Bessie Leung
Accountant
IS Mgr.
59
Ticker Symbol
10 **
Exchange:
130
0
1
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.013
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
Proprietary--ITIS
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Belkin International
Computer Peripherals
US
Conair
US
J.C. Penney
General Merchandisers
US
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
China
Europe
North America
Rical
Latin/South America
United States
Hong Kong
India
Indonesia
Korea
Malaysia
Singapore
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Rical is primarily involved in exporting/NVOCC activity.
Provider's Strengths
Hong Kong base and freight forwarding operations.
Provider's Weaknesses
Limited geographical and functional scope.
18th Edition
info@rudolph-log.com
49 561 494180
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1946
Asset Focus:
Market Area:
Founding Business:
International
Trucking
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jrgen Rudolph
Managing Director
Managing Director
VP Transportation
228
Ticker Symbol
228 **
Exchange:
1,700
20+
ASSETS
Total Transportation Assets:
Total Tractors:
80
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
300
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
5.6
395
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Latin/South America
North America
CUSTOMERS
Europe
Asia/Pacific
Australia/New Zealand
Industry
Manufacturing
Audi AG
Chemicals
BMW AG
Bogar AG
Pharmaceuticals
Location
TM
WM
VA
DCC
Inte IM
Continental AG
18th Edition
Asia/Pacific
Europe
North America
Rudolph
Latin/South America
Bulgaria
Germany
Great Britain
Hungary
Latvia
Luxembourg
Portugal
Russia
EDITOR'S COMMENTS
Rudolph is a sophisticated automotive logistics 3PL. About 70% of Rudolph's business is in automotive. It
continues to expand in contract logistics for auto parts vendors, high-tech and other verticals. Rudolph is a well run
company and takeover target.
Provider's Strengths
Operations between Germany and "New Europe."
Provider's Weaknesses
18th Edition
305-675-0754
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Global
Truck Leasing
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
Tier 1 supply chain manager with presence in most major markets. Very good DCC.
KEY PERSONNEL
Gregory Swienton
John Williford
Tom Jones
CEO SCS
SVP U.S. SCS
Robert Sanchez
John Sonia
1,611
Ticker Symbol R
1,413 **
Exchange:
8,595
804
3-5
NYSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
2,793
Total Trucks:
503
Total Trucks:
50,300
Total Other:
160
Total Trailers:
Total Aircraft:
35,400
0
488
686
Total Tankers:
27
Total Ocean:
Total Other:
15
3,100
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies, Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i2 Technologies
V3 Systems, Manhattan--PkMS, Appian, Propriet
i2 Technologies
Proprietary
LogicNet
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Andersen Windows
Applied Materials
Europe, N. America
ArvinMeritor
Publishing, Printing
NJ
Aspects Beauty
Atlanta Journal-Constitution
Publishing, Printing
BellSouth
Telecommunications
Boeing
Boral Bricks
BrandsMart
Specialty Retailers
Carrier Corp.
N. America, L. America
Chrysler/Fiat
N. America
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
GA
Asia/Pacific
China
Singapore
Europe
North America
United Kingdom
Canada
Ryder
Latin/South America
Mexico
United States
EDITOR'S COMMENTS
Ryder, one of the most recognizable 3PL brand names, is a big-5 logistics 3PL. Ryder is a lead logistics
provider for most GM plants and services Chrysler/Fiat, Toyota and Honda plus a multitude of Tier 1 suppliers.
Ryder runs top notch inbound supply chain management, sequencing centers, just-in-time and dedicated contract
carriage operations.
John Williford, the chief executive officer of Ryder, and Tom Jones, executive vice president and chief of the
automotive logistics operations, are redesigning Ryders SCS emphasis. Their redesign is based on an expansion
of Asia-US retail business leveraging off of the purchase of Transpacific Container Terminals and CRSA and a joint
partnership with Hong Kong based Cargo Services Far East. Operations in South America have been eliminated
so that Ryders resources can be applied more strategically. Ryders SCS business was about 60% automotive
through 2008. Williford and Jones are working hard on the further expansion of retail, consumer goods, and hightech business. Jones had been moving Ryder to these new verticals with some successes over the last few years.
Provider's Strengths
Ryder has LLP supply chain management. Dedicated contract carriage and transportation management are
strong. Distribution center operations are capable.
Provider's Weaknesses
Increasing flexibility and central control.
handles most of the transportation exceptions. Each of its exception managers cover about 250 loads a day. Ryders TMS operations provide
dashboards with extensive key performance indicator (KPI) information and tracking capabilities for customers and truckers. Standard carrier
KPIs cover on-time performance, tender acceptance, update activity and daily summaries.
Overall, the freight under management (FUM) process works very smoothly. At most times it is like a well made car operating on cruise
control. In addition to the FUM operations at the TMC, Ryder has built a significant freight brokerage operation. Ruth Lopezs operation now
handles 100 loads a day and is expanding its backhaul management for Ryders dedicated contract carriage (DCC) operations. There are 18
people in Lopezs operation split between customer service and dispatch/truck handlers. Lopez and the employees in Ryders brokerage were
trained at the TMC. Margins are similar to industry averages. Most loads move in vans but there is refrigerated trailer and flatbed activity.
The smoothness and efficiency of Ryders TMS operation is exactly what Todd Carter wants. Carter has been at Ryder for a little over two
years. He has fine tuned the operation to its world class capabilities. We met Carter at GATX over a decade ago. He was a key member of Joe
Nicosias (Hope is not a plan!) team. Complimenting Carters efforts is John Williford and his master plan for Ryder. Williford is retooling
Ryders Supply Chain Solutions and Dedicated Contract Carriage Divisions to concentrate on strong operational strengths and provide crafted
but generally uniform solutions for customers in retail/consumer goods, high-tech and automotive verticals. The retail emphasis is new to
Ryder and is a logical reworking of its powerful automotive manufacturing and transportation supply chain support functions.
Profitable but non-strategic, problematic operations in Argentina, Brazil and Chile have been eliminated in favor of strengthening North
American and Asian operations. CRSA Logistics and its sister consolidation/deconsolidation company, TCTL, were added to handle Asia to
Canada retail supply chain solutions. These operations are based in Shanghai and come with a good IT base which allows for expansion. In
Shanghai, Paul Tay is crafting the plan for Ryders Asian expansion. This Asian/North American expansion is a major piece of Ryders retail
vertical development.
Expanding Mexican operations is also in process. Ryder handles about 3,800 border crossings a week between Mexico and the U.S.
Mexican/U.S. operations are key to automotive, high-tech and other Ryder customers. Within Mexico, Ryder has solid value-added
warehousing and distribution (VAWD) and DCC operations and over $100 million in revenues. It is a strong base to build on.
Williford has charged his six primary direct reports with the development of proactive, quickly implementable, Lean solutions. Willifords
reports are key for expanding the new supply chain management offerings. They are:
Tom Jones, Senior Vice President & General Manger
Stephen Dean, Senior Vice President Sales & Marketing
Steve Martin, Vice President Supply Chain Excellence
Paul Tay, Vice President & Managing Director Asia Pacific
Gene Sevilla, Vice President & Managing Director Latin America
Guy Tokso, Vice President Canadian Operations
Williford has a history of cutting edge solutions for high profile customers like GM (Vector) and USPS. He is not afraid to think outside the
box and cut to the chase. He has put together a strong team for driving the change at Ryder and increasing third-party logistics competition.
See the Armstrong & Associates report Ryder Streamlines Transportation Procurement from October 2, 2008.
Ryder Streamlines Transportation Procurement with i2's Transportation Bid Collaboration System
link: http://www.3plogistics.com/Ryder_i2_TBC_2008.htm]
Novi, MI USA Site Visit
October 2, 2008
shipped via truck to seven distribution points in Canada. In Canada, Ryder provides DCC delivery and transportation management to stores and
distributors. The BAT Canadian operation operates under the brand name Imperial Tobacco.
Ryders BAT warehouse is a new, food grade facility with 210,000 square feet. There is a protective cooler area of 60,000 square feet. Product
is controlled and shipped on a first in first out (FIFO) basis to Canada. In addition, Ryder manages the packaging material (cardboard) for the
plant. Cardboard is shuttled to the plant as needed and seven loads a day are brought back.
This RF facility uses WebSphere for its WMS. Manhattans PkMS is used for Canadian distribution. RF reading devices are Symbol guns and
pallets have license plates.
Ryder uses five tractors and 10 trailers for the dedicated shuttles. Celadon is the primary outbound carrier.
To summarize, Ryder manages packaging material to the plant utilizing its DCC for transportation. Ryder moves finished product to the
protective RF environment. It controls the finished product inventory until requested to release it on a FIFO basis. It provides transportation
management for outbound linehaul to Canada and distribution to Mexico. In Canada, it provides cross-docking, dedicated store delivery and
transportation management to get the product to customers.
Incidentally, BAT pays the cigarette taxes when the product is cleared into Canada.
Others
The HP operations in Guadalajara are a good example of multifunction supply chain management. Inbound is managed to the plant.
Transportation planning and execution is done for U.S. distribution. DCC is provided for activities close to Guadalajara. Ryder provides
extensive piece picking and packing and returns management for HP in Guadalajara.
Ryder has over 1,700 employees throughout Mexico.
Ryder System Gains Traction in China
Shanghai, China Site Visit
October, 2007
Key Personnel:
Christopher Woodward - Vice President & Managing Director, China
Alice Yu - Director of Business Development, Greater China
Gary Maida - Senior Logistics Manager
Chris Gee - Senior Logistics Project Manager, China
Ryder has been working in China since 2000 when it began assisting Shanghai General Motors (SGM) in launching an inbound logistics
management process for its production facility in Shanghai. In 2001 Ryder formally entered the market by forming a Wholly Owned Consulting
Company in the Shanghai Free Trade Zone. In 2006 Ryder received a logistics license to perform integrated logistics services in China. Its main
third-party logistics (3PL) service offering includes: transportation management, value-added warehousing and distribution, and supply chain
engineering and design services. Major customers in China include: Beijing Benz, Lucent, and Italian household systems manufacturer Merloni
TermoSanitari (Merloni). Ryder China's basic operational service offering is detailed in the figure below.
At the time of our visit in mid-October, Ryder had a team of 95 people in China, eight of which were logistics engineers. It managed 226,000
square feet of warehouse space in six cities: Shanghai, Beijing, Wuxi, Changchun, Nanjing and Kunming. Ryder was also managing domestic
transportation in approximately 200 distinct lanes. This December, Ryder is starting up a new operation for a consumer electronics/white goods
customer in Shanghai that will bring its total square footage to approximately 500,000 square feet, its transportation management network to
about 250 lanes, and its total number of employees to 160. This operation is set to go live the second week of December. In addition, Ryder is
contracted to open up warehousing operations in Guangzhou, Harbin, Fuzhou, Changsha, Wuhan, and Zhengzhou in the first quarter of the
new year.
In addition to Ryder's traditional transportation management and value-added warehousing and distribution operations, Ryder China is
currently providing some interesting global transportation management services that are capable due to the time difference of 12 hours between
the eastern U.S. and Shanghai. According to Chris Woodward--Ryder's managing director for China--by using teams composed of Ryder staff in
both the U.S. and China, Ryder provides a virtual 24 hour work day making it easier to staff and support central transportation management
operations required to run 24 hours, seven days a week.
Case Study: Merloni's, Ryder Domestic China, Network Redesign and 3PL/4PL Services
With the help of i2's Supply Chain Strategist, supply chain network optimization software, forecasted demand volumes and service level
requirements, Ryder's engineers designed an optimal domestic China distribution network for Merloni's Ariston water heater product line. In
addition, Ryder worked with Merloni in developing key indicators for monitoring supply chain performance.
By utilizing Ryder's optimal network design solution and its 3PL and 4PL services, Merloni has reduced its Chinese distribution center (DC)
network from 18 to 12 Ryder managed locations. The redesign has dramatically reduced Merloni's on-hand inventory levels while improving its
transportation service and direct service area coverage to customers.
While Ryder's main Merloni central distribution center operation is in Wuxi, we had a chance to visit its 4PL Shanghai regional distribution
center (RDC) operation in the northwestern Jiading district of Shanghai.
Ryder utilizes a local 3PL (Kanto) for warehousing, including non-management labor, and Merloni's Shanghai local transportation services.
The RDC is 22,600 square feet and product is stored on pallets on the warehouse floor. Most of the water heaters are destined to Chinese bigbox retail stores such as Gome and Yolo.
To support its Chinese warehousing and distribution operations including Merloni, Ryder uses a popular local warehouse management
system--"Flux" WMS. Flux is integrated with Merloni's order management system in Wuxi. As orders are generated they drop into Flux. Flux is
used to print paper pick lists for picking in the warehouse and for putaway of product as it is received. Once product is picked and loaded into
trucks for outbound distribution, Flux is updated with the information which also automatically updates Merloni's order management system.
Through this tight integration, inventory accuracy and visibility has been dramatically improved.
Summary
Ryder has learned many lessons since entering the Chinese 3PL market with SGM. It is using its logistics engineering expertise, information
systems, and operational process design expertise to develop tier-one Chinese supply chain operations and differentiate itself from domestic 3PL
18th Edition
competitors. Ryder has had to be creative in its business development approach and is beginning to see significant success. With this approach,
Ryder has become established in one of the fastest growing global 3PL markets and is on track to become a leading domestic Chinese 3PL
provider.
Cooperation Alters Operations Among Warehouse Users [By Michele Fuetsch, Transport Topics, July 26, 2010]
The 3PLs dealing in consumer packaged goods were the first to embrace collaborative distribution but the trend today has been adopted the
fastest by 3PLs serving the electronics industry, said Steven Sensing, vice president and general manager of high-tech and electronics for Ryder
Supply Chain Solutions, part of Ryder System Inc. Miami.
Its a service or a solution that 3PLs are providing to their suppliers and, in turn, creating value for the end-retailer as well in a consolidated
shipment.
Ryder, though, has built on the collaborative model, opening what it calls campuses to match the needs of electronics manufacturers and
retailers.
Their footprint requirements are 250,000 square feet to 500,000 or 600,000 square feet of space which does not lend to a multiclient
solution [in just one building], Sensing said.
Thats where we go into more of a campus environment, where you have those suppliers co-located, Sensing said, and you still have
that abilityto optimize across multiple customers in [neighboring] buildings more full truckloads or multistock truckloads versus an LTL.
For its large electronics manufacturing clients, Sensing said. Ryder has created three major collaborative distribution campuses: in metro Los
Angeles and Dallas and in Groveport, Ohio.
From all three places, he said, Ryder is creating full truckloads of products from several manufacturers bound for retailers around the country.
To further enhance its distribution services and cut labor and time from the supply chain, Ryder has created new customer delivery teams.
In the past, lets say, four customers, suppliers that we had going into a Best Buy, we would make four different phone callsfor those
customers, Sensing said.
Today, just one phone call goes out to a retailer to set up a delivery appointment on behalf of the four suppliers.
So, what you do is, you build up that relationship with that retailerIt improves the delivery and the appointment setting for those carriers
when they go in. Sensing said.
Looking to cut costs and build profits, more manufacturers and supply chain providers are honing their reverse logistics
Consumers are a fickle, demanding bunch. That widescreen HDTV they buy today may not be what they want tomorrow. Those boots you
bought for your wife online for Christmas might just be the wrong color or size. Or you may be one of the 1.7 million people who bought the
iPhone 4 in the first three days of availability last month, only to lose reception because of a balky antenna.
So back the products go, returned to the store they came from, or, if acquired online, shipped back under a guaranteed returns policy to
the tune of more than $185 billion last year, according to the National Retail Federation, 8 percent of the estimated $2.3 trillion in retail products
NRF members sold.
And thats just on the retail side. With that much product in the returns pipeline, is it any wonder reverse logistics, once a mere afterthought,
is now a top priority for manufacturers and service providers looking to cut costs and boost profits.
In a February 2010 survey, Reverse Logistics: Driving Improved Returns Directly to the Bottom Line, 87 percent of 164 companies said
effective management of the reverse supply chain is extremely important or very important to their operational and service performance, up
from 74 percent in 2008 and 61 percent in 2007.
One of the key factors driving interest in reverse logistics in the consumer/retail technology and high-tech sectors is shorter product life
cycles. Without good returns processes, inventory imbalances on obsolete or soon-to-be obsolete products can hurt a companys financial
performance.
A lot of new products are competing for market share, Leider said. Its very difficult for companies to predict which models will be
popular.
In 2008, the last year for which figures were available, returns and exchanges in the $165 billion U.S. consumer electronics industry totaled
$11 billion. Return rates for all consumer electronics are about 8 percent, and 13 percent for video products, because of the popularity of
HDTVs, according to the Arlington, Va.-based Consumer Electronics Association. Thats a lot of returns, considering 325 million televisions,
233 million cell phones, 222 million DVD players, 164 million digital cameras and 128 million desktop computers are in use in the U.S.
In the Aberdeen survey, returns represented an average of 16 percent of companies total sales of equipment and parts. The main challenges
facing companies in the returns process are products returned with no fault found, returns velocity, lack of customer support, lack of visibility,
and warranty and billing issues.
Ryder System, a Fortune 500 logistics and transportation provider, found so many plasma TVs, iPods, PCs and other electronics were being
returned with no fault found about 75 percent that it made sense to locate reverse and repair facilities close to customers distribution
centers so goods could be restocked as soon as possible, said Steve Sensing, Ryders vice president of supply chain solutions.
Of the remaining 25 percent of returned products, about half are repaired and sold through other channels, while scrapped products are
disposed of in an environmentally responsible way.
With so many recoverable assets in the reverse supply chain, companies can ill afford to just scrap returned products, as they used to. Now, it
s all about asset recovery and root cause analysis.
People trashed what might have had value, Sensing said. A large percentage of goods can go back out.
Ryders reverse logistics management system provides a front-end Web portal that allows for returns initiations, authorizations and visibility
throughout the entire process at serial number and SKU levels.
Reverse logistics has long been used for product recalls, and in the food industry and other verticals, but explosive demand for cell phones
and consumer electronics in the past 20 years, and the emergence of online retailers, has created a vastly bigger market for returned goods, said
Chris OBrien, vice president of C.H. Robinson Worldwide, a global 3PL based in Eden Prairie, Minn.
18th Edition
#1 Ryder
WHY THEY WON: IL readers' top-rated 3PL inspires declarations such as, "We only use one 3PL-Ryder. It is the only one that meets our
needs" and "By far, the best 3PL company around!"
John Williford, Ryder's president, global supply chain solutions, credits the 3PL's deep expertise in key industry groups and our commitment
to operational excellence" with helping to meet our shippers unique challenges and deliver consistent results.
But Ryder isnt resting on its laurels. This year, our newly formed Retail/CPG group
expanded our capabilities for the flow of goods from Asia, including purchase order management, shipment consolidation in Asia, and
deconsolidation in North America," says Williford.
John Snider, vice president of logistics at hardware retailer Do It Best, lauds the Miami-based 3PL's eye for cost savings. "Ryder has been a
key component of our cost-control efforts," Snider says. "They are constantly looking at ways to reduce costs and pass on the savings. In one
respect, Ryder is just a vendor. But Ryder as a partner is more valuable to us than Ryder as a vendor."
CASE STUDY: iGPS
Intelligent Global Pooling Systems (iGPS) required a logistics model to support deployment of more than 175 million pallets across its
customer base. It turned to Ryder to help design a network where iGPS customer locations CPG and retailer warehouses became pallet
pooling centers.
Ryder developed an optimization model that worked with the dynamic iGPS network, while managing complicated inventory levels and rapid
growth. Ryder tracks pallets in use daily and identifies available pallets at an iGPS customer warehouse that are ready to be re-deployed. Ryder
handles all transportation, inventory management, and reverse logistics services, including managing third-party carriers and handling freight bill
payment and audit. This strategic partnership has provided iGPS with a highly flexible, scalable solution that can grow with the company as it
explores new territories and industries.
18th Edition
81-3-3536-3869
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1918
Asset Focus:
Market Area:
Founding Business:
International
Stevedoring
OVERALL CAPABILITY
Overall Capability of Provider:
Capable Japan-based 3PL and SCM with a strong presence in Asia and operations in Europe, USA and Brazil.
KEY PERSONNEL
Kimikazu Nakamura
Koji Morito
Hitoshi Yoshida
Manabu Ino
Yoshikazu Murakami
2,065
440 **
13,000
>200
4-5
Exchange:
TYO
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
143
Total Trucks:
544
Total Trucks:
940
Total Other:
91
Total Trailers:
Total Aircraft:
140
Total Ocean:
Total Other:
11.2
0
10
1,200
64
Total Tankers:
Total Other:
632
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Healthcare
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Aisin Seiki
Japan, China
BASF
Chemicals
Japan
Denso
China, Europe
DuPont
Chemicals
IKEA
Specialty Retailers
Japan
Pharmaceuticals
Japan
Japan
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
China
Sankyu
Europe
North America
Latin/South America
Netherlands
United States
Brazil
India
Indonesia
Japan
Korea
Malaysia
Philippines
Singapore
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Sankyu is an asset-based Japanese 3PL with a strong presence in the Asian market as well as operations in
Europe, USA and Brazil. Although Sankyu still does a significant amount of project logistics, the main revenue
from its logistics division is from the automotive, chemicals, consumer goods and retailing industry verticals.
Logistics generates almost half of Sankyu's total company revenue.
On January 15, 2010 the construction of Sankyus new Flagship Distribution Center was complete. It has a total
of 907,400 square feet and is located across from the container yard at the Port of Kawasaki, near Tokyo.
Provider's Strengths
Comprehensive network in Japan and the rest of Asia. Its fully owned IT subsidiary. The successful relationships
it has with leading Japanese companies as well as US and European multinationals.
Provider's Weaknesses
As a logistics system developed by Sankyu is available for use, users can manage their inventories, purchase orders (P/Os), and shipments via
the Internet from anywhere in the world, the company said.
Sankyu group profits down despite sales increase
August 6, 2008 In the first quarter of fiscal 2008 (April-June), the Sankyu Inc. group earned an operating profit of YEN5.38 billion,
marking a decrease of 1.8 percent year on year. The company posted an ordinary profit of YEN5.55 billion (down 3.5 percent) and a net profit
of YEN2.91 billion (down 5.4 percent). All this comes at a time that saw sales of YEN92.28 billion, an increase of 2 percent.
By business, the logistics services suffered declines in both sales and operating profit, with the former chalking up YEN59.78 billion (down
0.4 percent) and the latter posting YEN2.37 billion (down 17.2 percent).
In a breakdown of specific logistic services, in-factory operations were favorable for customers in the iron and steel, petroleum and
petrochemical industries, but containerized cargo volumes between Asian countries weakened.
Lack of cargoes moving to and from China, combined with the completion of many major projects overseas had a negative impact on
earnings. The damaging effects of sharp rises in bunker oil prices worsened the divisions profitability, which led to a further decline in operating
profit.
With regards to Sankyus plant engineering and installation services, the company enjoyed growth in both sales and profit. Sales rose 8.1
percent to YEN28.24 billion and operating profit for the quarter surged 19.6 percent to post YEN2.72 billion.
Large-scale equipment installation work in the iron and steel industries declined during the quarter, but thanks to an increase in repair
services - regular, shut down maintenance -- for petroleum- and petrochemical-related customers the division was able to enjoy healthy growth.
Other Sankyu services posted an overall sales mark of YEN4.26 billion, a decrease of 1.6 percent and an operating profit of YEN233 million,
a drop of 22.9 percent. The reasons behind the profit and sales contractions were a decline in orders for system development and the
discontinuation of ship leasing services.
JP and Sankyu set up JV forwarder
July 8, 2008 Japan Post Service Co. Ltd. and Sankyu Inc. recently established a joint venture, with Sankyu spinning off its airfreight
business, including the carriage of small-lot international parcels, while Japan Post Service took a stake in the new international logistics service
provider.
Japan Post Sankyu Global Logistics Co. Ltd. is capitalized at YEN300 million, 60 percent of which was invested by Japan Post Service and
the balance by Sankyu.
It will be engaged mainly in forwarding air cargoes, and also in NVOCC, trucking, customs-clearance, and warehousing services.
Sankyu sees big gains in FY07
Sankyu Inc. scored significant gains in three categories of profits on a consolidated basis in fiscal 2007 (April 2007 March 2008).
On sales of YEN430.79 billion (up 5.7 percent from a year earlier), the Sankyu group made an operating profit of YEN25.81 billion (up 24.5
percent), an ordinary profit of YEN 24.91 billion (up 23.1 percent), and a net profit of YEN14.47 billion (up 36.5 percent).
The Tokyo-based logistics company, which pays out a dividend at one time at the end of a fiscal year, plans to offer an annual dividend of
YEN9 per share, an increase of YEN3.
In the logistics business, the volumes of containers and project cargoes to overseas destinations both fell.
However, throughput increased in 3PL services as well as in-factory operations for clients in the iron and steel, petroleum, and petrochemical
industries.
As such, sales from logistics services improved 2.7 percent to YEN240.12 billion.
As the group endeavored to curtail costs by withdrawing from low-profit activities, furthermore, operating profit rose 8.1 percent to YEN9.2
billion.
In the plant engineering and installation business, the Sankyu group made active capital investments in, among others, the enhancement of
capabilities at its facilities for iron and steel, petroleum, and petrochemical customers, and the update of oil facilities.
As a result, it achieved sizable growth in operating profit on increased sales, with the former growing 36.7 percent to YEN14.81 billion (up
35.7 percent) and the latter, 5.7 percent to YEN162.03.
The group registered huge gains in both sales and profit from other services as well.
Sales jumped up 42.4 percent to YEN28.65 billion and operating profit 31.2 percent to YEN1.53 billion.
For the current fiscal year, the company anticipates decreases in both sales and profit in consolidated term, forecasting to earn, on sales of
YEN425 billion (down 1.3 percent from fiscal 2007), an operating profit of YEN24.9 billion (down 3.5 percent), an ordinary profit of YEN24.2
billion (down 2.9 percent), and a net profit of YEN13.6 billion (down 6 percent).
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1981
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
One of the half dozen major China based, India Subcontinent, and Asian NVOCC/air freight forwarder operations.
KEY PERSONNEL
Adam Ho
Gino Lim
Solomon Wong
Michael Sin
Kevin Tong
CFO
CIO
Ticker Symbol
300
75 **
2,000
2-3
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.4
0
4
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
E&B Giftware
Fastenal
Specialty Retailers
US
J.C. Penney
General Merchandisers
US
QVC
US
Siemens
China
Tyco Electronics
China
Watsons
Specialty Retailers
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Bangladesh
Australia/New Zealand
Italy
Canada
Cambodia
Spain
United States
China
Turkey
Hong Kong
United Kingdom
Scanwell
Latin/South America
India
Indonesia
Japan
Korea
Malaysia
Pakistan
Philippines
Singapore
Sri Lanka
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Scanwell is a major Asian, China based freight forwarder with strong air and ocean operations in key strategic
production cities, from Hong Kong to China, India to the Indian Subcontinent, Singapore to Vietnam, and rest of the
Far East countries.
Scanwell has eight U.S., two Canadian, and over 70 worldwide owned offices providing direct service contacts
for international trade buyers and vendors. About 85% of shipments handled are FOB at ports which means they
are paid for and controlled by U.S. and other global consignees.
Of the over 100,000 TEUs handled each year, 60% are North American and 40% are European, Australian, and
intra-Asian. Airfreight shipments are primarily to North America.
Adam Ho founded Scanwell in Hong Kong in 1981 and expanded to Taiwan, Seoul, Singapore, and the U.S.
fairly quickly. To cope with the opening policy of China, Scanwell established its broader China network in 1990
and India network in 1995. Over the years, freight forwarding has been augmented by expanding services.
Scanwell's traditional vertical markets are apparel and CPG for department stores, private labels, and other
retailers. Scanwells network has diversified and established a wider range in industrial markets in the last decade.
Scanwell has to be a very competitive business because high-tech and electronics are more profitable verticals
now handled primarily by large global supply chain managers.
Scanwell is interested in M&A activities to expand its business.
Provider's Strengths
Provider's Weaknesses
Gross margins in De Wells NVOCC market segment from China to the U.S. are less than 10% as opposed to the traditional European
industry standard of 20%. De Well buys significant capacity from 14 container lines. Some LCL (less-than-container load) is consolidated and a
significant portion of De Wells space is resold to other freight forwarding companies.
De Wells other business, depot management, runs higher volumes and profits. At its five Shanghai locations, De Well stores and repairs
containers for all of the container lines calling at the Shanghai ports of Pudong and Yangshan. The depots operate 24/7 and process 21.4
million containers a year. In addition, De Well operates 150 tractors out of three Pudong depots. De Wells trucking operations deliver and
pick up loads operating alongside a host of other Chinese trucking operations. Dispatch for trucking operations is at Pudong 1, the largest
facility. All De Well trucks have GPS and radio control.
At Pudong 1, 10,000 containers are stored at one time. They are normally stacked seven high. Container locations are maintained using
wireless yard control software.
De Well inspects all containers and repairs about 700 a day. Six Kalmar side-loaders are used to move trailers around. Each unit is on the
yard control system.
In addition to the container depot and trucking terminal operations at Pudong 1, warehousing is done. At the time of our visit, 120
employees were involved in inspection and kitting operations. A proprietary WMS (warehouse management system) is used for location control
in the warehouse.
Non-De Well drivers pay for container use at the front gate where trailer numbers and locations are provided. Seven days free time are given
for each container.
In addition to opening an LA basin warehouse, Time Yang remains on the lookout for the right U.S. third-party logistics provider (3PL) to
purchase to expand his company. He has built De Well to a thriving business in 19 years, and at 47 hes got a lot of fire left.
Scanwell
Adam Ho started Scanwell in Hong Kong 28 years ago. In addition to its NVOCC operations, Scanwell Hong Kong handles 40,000
tonnes of airfreight a year. About two-thirds of these shipments are garments for customers like J.C. Penney. In addition, Hong Kong manages
truck transportation and distribution into the PRC for companies including Tyco Electronics. An important commodity for distribution is wine
most of it warehoused at NISKO, a partner company. Scanwell maintains contracts with 15 container lines in Hong Kong. Adrian Hassan,
Hos son, is executive director of business development in Hong Kong.
In 1993, Solomon Wong initiated the PRC operations for Scanwell. Wong, like the rest of the top echelon at Scanwell, is bi-cultural and
polished. Jeff Zhu, deputy general manager China, attended college in the U.S. and worked here for years. Wong lived and worked in the U.S.
for six years.
Scanwell handles over 100,000 export TEUs a year. Sixty percent go to North America and 40% go to Europe. Apparel is the primary
commodity handled through Shanghai. While Shanghai handles a sizable amount of airfreight, it is Scanwells primary ocean shipping location.
Wong discussed the available business openly. He pointed out that electronics and high-tech shipments are handled primarily by large global
supply chain managers (SCMs) like DHL and UPS. He acknowledged that companies, like Scanwell, were relegated to lower value commodities
but pointed out that margins on Scanwells airfreight business were twice what could be made on ocean freight.
Scanwell has eight U.S. offices and two Canadian offices. It also has significant coverage in Taiwan, Korea and Southeast Asia.
Summary
De Well and Scanwell are two strong but quite different Chinese NVOCC based logistics providers. They are part of a small group of
Chinese companies that could grow significantly over the next few years either organically or by purchasing American companies. At the same
time, they are attractive candidates for several American companies itching to be global SCMs. The guys we met are bright and very good
businessmen. They have been successful in China and Hong Kong and expect to be in North America and the rest of the world.
18th Edition
416-401-8811
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Canada
Third-Party Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jim Eckler
Chris Galindo
Paul Ragan
CFO
CIO
148
Ticker Symbol
148 **
Exchange:
1,113
25+
4
ASSETS
Total Transportation Assets:
Total Tractors:
6
Total Trucks:
Total Trucks:
16
1.5
Total Other:
Total Trailers:
Total Aircraft:
10
18
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): TECSYS, Scancode, TMW
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Barloworld's CAST
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3SO
Canada
Amazon.ca
Canada
Avon
Canada
Bell Canada
Telecommunications
Canada
Canada Post
Canada
Canon
Canada
Honda Motor
Canada
Lowe's Canada
Specialty Retailers
Canada
Pitney Bowes
Canada
Rogers Communications
Telecommunications
Canada
Siemens
Canada
Toys "R" Us
Specialty Retailers
Canada
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
SCI
Latin/South America
Canada
EDITOR'S COMMENTS
SCI is a well run Canadian 3PL with good ties to major Canadian companies. Eckler has been a good CEO and
continues to expand SCI.
Provider's Strengths
Parent strength, profitability and partnerships.
Provider's Weaknesses
Needs broader North American presence.
The Solution
SCI Logistics assembled key resources from the organization, keeping the team small and focused to quickly address the challenges and
propose a flexible, innovative solution. Members of the team included our directors of quality, operations and systems.
The quality and flexibility of our solution was key to its successful implementation. The new acquisition and the clients various locations
resulted in processes being disjointed across many functional areas of the business.
By bringing everything together, we were able to incorporate all activities including fulfillment, assembly, returns and all key reporting and
metrics into one system. The system was integrated to the clients host system for almost real-time information exchange, allowing automated
subscriber activation. It also provides complete life cycle tracking of each handset along with a web portal that allows for real-time data on
inventory and shipment status, along with self-run reporting. The solution was rolled out across three facilities one in Toronto, one in Langley
to service the B2C market and one in Mississauga to support retail through a VMI model with vendors.
The solution features:
Robust and highly scalable WMS/TMS
Fully deployed hotsite for contingency, allowing complete failover systems
Full RF deployment in warehouses
Web portal for inventory and order track and trace
The Results
The SCI Logistics solution delivered exceptional results against objectives:
Achieved year-over-year cost reductions of 5% to 10%
Achieved dock-to-stock efficiency rates of less than 4 hours
Orders received by 4 p.m. guaranteed to ship same day
Inventory accuracy greater than 99.99% (virtually zero shrink)
Ability to service almost any centre in Canada through zone skip model
CASE STUDY: MANUFACTURING
The Challenge
Our client is a manufacturer of wireless handsets and accessories who markets and sells to clients around the world.
Historically, its Canadian warehouse operations were split between direct-to-client (D2C) shipments for Canadas largest wireless service
provider and bulk distribution to other national wireless providers. The operations also handled D2C orders from its Canadian e-commerce
business.
Recognizing the need to improve efficiency and better manage costs, the client determined that instead of operating its own Canadian
distribution centre, it would outsource warehousing and distribution operations. SCI Logistics was selected as the supplier of choice to serve the
Canadian market.
The Solution
SCI Logistics engineered a solution integrating a full suite of supply chain services that delivered full visibility and life cycle product tracking
of every handset at every stage of the supply chain.
The process of creating the solution began with our Solutions Team and the client working together to determine the clients key
requirements including the complete transfer and outsourcing of the clients GTA operations to the SCI Logistics Mississauga facility.
One of the challenges was integrating the solution with the wireless service provider, including adhering to its vendor managed inventory
(VMI) requirements. For the VMI program, our client maintains ownership of inventory and fulfills orders passed to it by the service provider,
billing them once shipment confirmation is received. VMI programs like this require extensive data sharing and reporting between all parties,
which means systems need to be seamless, regardless of who owns them. Our Solutions Team quickly assessed the operating and technology
environments of each company and built several interfaces between the manufacturer and the service provider systems to support all supply
chain activities, including the VMI program.
The remainder of the solution involved designing and implementing freight management services and assembly and kitting services. We also
created cross dock processes for moving product to other large client warehouses in the Canadian marketplace. And finally, we supported our
clients e-commerce offering in Canada, distributing product directly to consumers who ordered through the companys website.
The key features of the solution include:
Robust and scalable WMS/TMS
Complete interface with the clients host SAP system
Real-time track and trace of inventory and order status via the web
Transportation management system that includes managing carrier claims on the clients behalf
Direct access to reports
The Results
Proof of the effectiveness of the solution is in the numbers:
Achieved inventory accuracy levels of 99.99%
On-time shipping of orders received before 4 p.m. exceeded 99.95%
Dock-to-stock in 4 hours with ASN receipt
18th Edition
A long-term sustainable solution that met client requirements and has been in effect since 2007.
Shipped more than 15,000 kg between the data centres on a monthly basis.
Maintained service standards throughout multiple airline seasonality schedule adjustments.
Leveraged existing network to provide the client with a solution that reduced their costs by more than 20%.
Reduced tender and retrieval times by 50%, resulting in improved delivery downstream.
Mitigated time constraints and provided client with more operational flexibility.
CASE STUDY: CRITICAL PARTS NETWORK
The Challenge
Post-sales support is a market differentiator for business equipment manufacturers.
To meet the rising expectations of clients, business equipment manufacturers have to deliver superior post-sale service. To do so requires
accurate, timely access to service parts inventories.
Progistix was called on by a leading business equipment manufacturer to help supply its 800 field service technicians across Canada with postsales support that would:
Maximize client uptime and field service technician productivity.
Standardize service levels across Canada.
Achieve consistent delivery times.
Formalize performance measurements.
The Solution
Progistix developed an integrated fulfillment solution designed to expedite the provision of service parts and provide order and inventory
management, returns management and end-to-end visibility.
Progistix formalized the definition of expedited delivery zones (30 minutes and 60 minutes) in 13 urban markets across Canada.
Progistix Critical Parts Network combined multi-client facilities for increased availability of service parts with a range of expedited delivery
services including 30 minutes, 60 minutes, next day, next flight out, after-hours support and technician pickup.
The solution integrated the clients parts entitlement and ordering system with Progistix SAP system.
The Critical Parts Network solution provided same-day processing of defective parts for repair and refurbishing by third-party agents,
restocking of good parts, and management of obsolete parts and excess inventories.
The solution delivered business-critical intelligence through tracing capabilities of the parts fulfillment process and web visibility of order
status and inventory positions.
The Results
Progistix innovative, integrated and intelligent Critical Parts Network solution delivered measurable and sustainable results. With Progistix
help, our clients client service solution achieved:
Exceptional operational performance.
Inventory accuracy exceeded 99.6%.
Service levels in time-critical 30- and 60-minute deliveries exceeded 98% nationally.
Reduced the number of broken calls, thereby increasing client uptime.
18th Edition
33 1 46 96 44 22
COMPANY BACKGROUND
Parent Corporation:
Bollor Group
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Herbert de Saint Simon
CEO
Jean-Pascal Naud
Didier Julien
Jean De Pouilly
J. Chatelon
CFO
CIO
5,604
1,120 **
Exchange:
28,000
Euronext Paris
ASSETS
Total Transportation Assets:
Total Tractors:
1,500
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
1,800
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
64.6
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Food, Groceries
Healthcare
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
18th Edition
Pro-Stream
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Alcatel-Lucent
Autoliv
Bayer
Chemicals
Delphi
EADS
Essilor
Eurocopter S.A.
Faurecia
GE Healthcare
Diversified Financials
Asia
Goodrich
France
Honeywell International
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia
Asia
Asia
Europe
North America
Latin/South America
Bangladesh
Australia
Belgium
Canada
Angola
Benin
Brunei
French Polynesia
Czech Republic
Mexico
Cambodia
New Caledonia
France
United States
China
New Zealand
Germany
Argentina
Brazil
Chile
French Guiana
Guadeloupe
Martinique
Uruguay
Botswana
Burkina Faso
Burundi
Australia/New Zealand
SDV
Algeria
Africa/Middle East
Asia/Pacific
Great Britain
East Timor
Cameroon
Central African Republic
Hong Kong
Chad
Indonesia
Congo
Japan
Korea
Italy
Luxembourg
India
Netherlands
Portugal
Romania
Russia
Laos
Spain
Gambia
Lebanon
Switzerland
Ghana
Malaysia
Turkey
Guinea
Kenya
Philippines
Gabon
Singapore
Liberia
Sri Lanka
Libya
Taiwan
Madagascar
Thailand
Malawi
Mali
Vietnam
Mauritania
Mauritius
Morocco
Mozambique
Namibia
Niger
Nigeria
Reunion Island
Rwanda
Senegal
Sierra Leone
South Africa
Sudan
Tanzania
Togo
Tunisia
Uganda
United Arab Emirates
Zambia
Zimbabwe
EDITOR'S COMMENTS
SDV is a quintessentially French transportation and freight forwarding company. It is ranked #1 in France by the
IATA and #5 in Europe. SDV operates in 89 countries with a large footprint in Europe, Africa and Asia. It also has
15 branches in major U.S. cities.
U.S. Headquarters Contact Information:
SDV Americas
150-10 132nd Ave.
Jamaica, NY 11434
Phone: +1-718-525-8100
Fax: +1-718-978-8425
Provider's Strengths
Varied operations and coordination abilities.
Provider's Weaknesses
French logistics company SDV Logistics said Monday it is starting a bi-monthly reefer consolidation service for shipments from Le Havre to
Tokyo.
The 28-day service is aimed at products needing cellar temperature, like wine and spirits, chocolate, biscuits and other foodstuffs, the
company said.
SDV is a subsidiary of the Bollore Logistics.
Africa a bright spot for SDV
18th Edition
AFRICAN traffic is one bright spot for Paris-headquartered forwarding group SDV in the current downturn, with its chief executive officer
Herbert de Saint Simon, saying airfreight shipments for the oil and mining industries, as well as infrastructure projects such as hospitals or roads,
are holding up well.
"The African market does not buy a lot of consumer goods, and so they are not so linked to the global downturn, and even though the price
of oil and copper has gone down, these industries are still producing," he says. Nevertheless, he admits that Africa is only performing relatively
well when compared to other global markets. "It is still down 10 percent, but the US and Asia are down between 20-30 percent. It also must be
said that Africa only accounts for 15 percent of our turnover and in other markets we are suffering, like everyone else."
Particularly hard hit globally are consumer goods, where Saint Simon says the downturn is "spectacular". Such sectors as perfumes, leather
goods and fashion have all been impacted here. Performing better are shipments linked to big industrial projects - such as the shipment of
machinery for new factories - as well as the oil and gas markets.
Despite the difficult market conditions, Saint Simon is adamant that SDV's strategy will not change. "This crisis will have an end and we
intend to be still there and ready to provide what our customers expect from us," he says. "We just hope the crisis will not last too long. In the
meantime, we have to cut costs as much as possible."
He reckons there will still be opportunities for the company during the downturn. "When times are hard, importers and exporters look for
new solutions, so if you can give them those solutions, you have a chance to win business," he says. "The answer lies in being imaginative at the
way you look at the supply chain."
He admits this could include weighing the use of airfreight against sea freight, but does not reckon there will be a major shift away from air as
a result. "The companies who use airfreight are generally the ones who have to use airfreight. Perhaps there are some marginal markets, such as
Europe to the US, where the difference in transit times between sea and air is not so high, but basically the need for airfreight will still remain."
Paradoxically, one worry for Saint Simon are the very low airfreight rates currently being offered in the market. While he admits these offer a
temporary advantage to shippers and forwarders, he says in the longer term they are not viable for airlines and so will have to return to more
normal levels.
The worry is that these very low rates are used in tenders, or that shippers come to expect such rates longer term, he says. If an exporter
wants a year-long commitment on rates, forwarders have to be realistic and say they cannot guarantee such rates. But my concern is that this is
not always done.
French-Anglo Merger between SDV International Logistics and JE Bernard Positions the Bollor Group as a Formidable Global Force.
website, March 12, 2007]
[via
Global freight management and logistics solutions provider SDV International Logistics, the transport and logistics division of the Bollor
Group, today announced the merger of JE Bernard in a move to strengthen its UK operations and to further consolidate its position as a true
global provider of freight management and logistics solutions products. This significant merger is consistent with SDV Groups pan-European
development program and will bring into balance its strengths within the European markets, following an earlier acquisition of the Geis
Network in Germany.
The merger with JE Bernard will add significant value and increase capability to the SDV Group, which has for some time been seeking to
develop a stronger position within the UK, and is seen as a perfect fit between two unique organizations with highly differentiating yet very
complimentary services, products and resources.
Commenting on the merger, Herbert de Saint Simon, CEO SDV International Logistics Europe, said: The merger between SDV Group
and JE Bernard is one of huge importance to us, creating a dynamic platform upon which we can build in the future. To this effect, we will
continue to strengthen our European operations with further developments expected in the very near future.
Commenting on the merger, Ed Kimber, the Bernard Group Chairman and CEO, said: The Bernard Group has enjoyed rapid expansion
over the last decade with particular emphasis on the development of our supply chain logistics solutions, customs and legislative compliance
products, but realized we needed a true global platform to seamlessly serve and dynamically respond to our customers ever-changing needs as
they compete in todays fast paced global economy. The merger with SDV International Logistics is a realization of these requirements, enabling
global reach and enhanced capacity, offering genuine solutions to complex supply chain issues, whilst forming a truly world-class organization. A
major consideration to both organizations was the perfect match of our people, assets and mutual customers which as a consequence made this
a very exciting and compelling business proposition, creating an organization of 445 offices in 88 countries, employing over 26,000 people. In
the UK alone, the newly merged company will boast 17 locations, 6 purpose built freight terminal facilities and employ over 500 members of
staff.
Bollor Group is a diversified industrial group with a wide range of activities including Transport & Logistics, Fuel Distribution, Industrial
activities, Media & Communication, Plantations, It employs 31,000 people in 105 countries with a turnover of 6 Billion Euros. Transport and
logistics is a core part of the Groups operations and this acquisition confirms the Groups commitment to building world-class freight
forwarding & logistics businesses.
Within the Bollor Group, transport & logistics account for 60% of total turnover with some 3.6 Billion Euros in 2006.
SDV International Logistics materializes its goals in India
Firmly established on the East/West route, SDV International Logistics, Bollor Group, is fleshing out its network and continuing its expansion
by investing in India.
With more than one billion inhabitants, India accounts for more than 20% of the worlds population. Its economy is growing strongly and
regularly, generating a significant increase in imports and exports.
In accordance with its international objectives, SDV International Logistics, the No. 1 on the French market and among the 6 European
leaders in IATA classification, acquired SWG Logistics that holds Air Link and Sea Link, both leaders in their fields of activity in India. Air Link,
the Indian operator ranking third in IATA classification and the countrys leading independent operator, controls 5% of the India-USA market
share. Sea Link is one of the countrys main forwarding and maritime agents.
This merger did not happen by chance since, for 5 years, Air Link and Sea Link, companies set up in 1989, have been official agents of SDV
International Logistics in India. With this acquisition SDV International Logistics will hold a majority stake in SDV - Air Link / Sea Link and
cover the entire country.
In India this acquisition will enable SDV International Logistics to fully cover this strategic market. Indeed with 20 offices with ISO 9001
certification in 16 towns (Ahmedabad, Bangalore, Chennai, Cochin, Coimbatore, Delhi, Hyderabad, Jaipur, Kolkata, Ludhiana, Mumbai,
Moradabad, Panipat, Pune, Tirupur and Tuticorin) and 380 highly qualified professionals, Air Link and Sea Link have recognized know-how at
18th Edition
their disposal, making them leaders on the market. With the same approach as the Group, Air Link and Sea Link teams have developed offers
dedicated to very specific sectors such as textile.
At the same time, in the United States, this merger will enable SDV International Logistics to strengthen its network. Air Links 5 offices in
5 towns (Atlanta, Charleston, Chicago, Los Angeles and New York) and 32 employees will join the Groups 14 agencies installed in 13 of the
countrys main economic centres (Atlanta, Boston, Chicago, Cleveland, Dallas, Denver, Houston, Los Angeles, Miami, New York, San
Francisco, Seattle and Washington D.C.). The alliance and complementary professions and means will enable all the teams to develop their
know-how for the greater benefit of the two companies.
This acquisition will also enable SDV International Logistics network to set up in Bangladesh and Sri Lanka covering, in this way, a major
part of the India sub-continent, a market with a high potential for development.
SDV International Logistics: the strength of a global network
Faced with the globalization of the economy and trade, this investment marks a new stage in the Groups external growth. Thanks to the
synergy of skills and means, SDV International Logistics will propose carriage and logistics solutions that are even more efficient and better
adapted to its customers needs.
SDV International Logistics has always wished to flesh out its network and this is why it is determined to make outright investments to
guarantee global solutions for its customers. In this way, SDV International Logistics and Air Link will develop their trans-Pacific flows as well
as routes such as India/ Asia, India/ Europe and India/Africa thanks to Bollor Groups African network.
SDV International Logistics, the No. 1 on the French market and among the 6 European leaders in IATA classification.
A recognized specialist in all carriage and logistics trades, the Bollor Group International Logistics Division designs tailor-made solutions
(Products dedicated to Aerospace, Oilfield, Express and Industrial Projects) for its customers, using the most advanced means (dedicated
computerized Tracing/Tracking tools).
An international anniversary
[via website]
When a luxury market leader organises its 150th anniversary celebrations, this takes on worldwide dimensions. In fact the brand decided to
celebrate this event in 5 of the world's major cities by organising a prestigious party bringing together between 1500 and 2000 guests for each
operation. So since the beginning of 2004 the show has stopped off at New York in February and Hong Kong in April. The tour will continue
in Tokyo in September and Los Angeles in November, finishing off in Paris.
For this celebration, the brand had a 71 m long and 31 m wide structure designed and built in New Zealand, requiring a local team 16 days to
assemble and 6 days to take down. Like for huge rock concerts, a production team based in Auckland was appointed to undertake the entire
project.
For such a large-scale project, a transport and international logistics leader was needed to ensure all operations linked to moving this event.
In November 2003, the decision was made: the Exhibition department of the SDV International Logistics Group was in charge of the whole
project.
From that moment on, the group's different offices were involved in the project; Auckland (New Zealand), New York (USA), Hong Kong
and Tokyo coordinated their actions in order to guarantee all equipment on site was made available for each event while taking into account the
time constraints imposed by the customer.
During November and December our Auckland agency started removing equipment throughout the whole of New Zealand to make it
available for the production on the site where the tent's "trial" assembly was carried out. Resources and handling staff were also made available
on site for operations involving unloading lorries and loading containers. In total 28 containers (Shippers Own Containers) were rented in
Auckland for a 1 year period in order to follow the whole tour.
At the end of December operations sped up with preparing and establishing ATA books which were essential for customs clearance in the
different countries visited. The freight left Auckland during the Christmas holidays. At the same time as this shipment, 3 40' HC containers and
2000 kilos of air freight left Italy between Christmas and the New Year with all the structure and stage equipment needed to assemble a giant
mobile screen.
So, for the freight leaving Auckland and Le Havre between Christmas and New Year, the group set up a dedicated team within each SDV
International Logistics office to monitor all operations.
First town visited: New York. A delicate leg of the journey because of the location of the site, right in the centre of Manhattan and very
difficult climate conditions: snow and -15.
The event venue being very limited space-wise, our New York agency had to find an industrial site nearby (5000 sq feet with travelling crane
and handling means) enabling the tent structure to be pre-assembled and then transported to the site with the help of more than 17 flatbed
trucks. The same operation was carried out to take down and reload the structure in the containers.
As the site could not receive all the trucks in one go, a schedule was set up with the production team. This had to take into account the
structure assembly requirements, site access conditions (circulation, restricted parking) and the time needed to unload various equipment. All
empty containers were then stored until dismantling.
The New York agency set up a dedicated team of 16 people to start packing and unloading all the decoration equipment as soon as the
evening ended which was the 11th February at 2 a.m.
From the 23rd February all 31 containers were on board a ship heading for Hong Kong for the party to take place the 16th April.
As the Hong Kong party required additional stage equipment, production had to rent equipment from specialised companies. The
Exhibition department thus had to coordinate the shipment by plane of almost 8000 tonnes of units from New York (USA), London (Great
Britain), Milan (Italy), Sydney and Auckland (Australia), as well as returning them after the event.
Once the evening had finished, some "sensitive" equipment was stored in a warehouse with a controlled temperature and ten or so other
containers, once loaded, were put into storage while waiting to leave for Tokyo, the departure date scheduled for the end of July.
18th Edition
jiayi@jiayi56.com
86-531-88276505
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1999
Asset Focus:
Market Area:
Founding Business:
China
Inland Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Wang Lin
CEO
Xuan Hu
Yue Li
Marketing Mgr.
Logistics Mgr.
Wang Peng
Zheng Shaofeng
CFO
CIO
40
Ticker Symbol
40 **
Exchange:
2,400
1-3
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
1,500
Total Other:
Total Reefers:
Total Flatbeds:
1.4
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Publishing, Printing
China
Panasonic
China
Wujixian
China
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Shangdong Jiayi
Latin/South America
China
EDITOR'S COMMENTS
Shangdong Jiayi Logistics provides transportation, warehousing and distribution services in China.
Provider's Strengths
Chinese distribution operations.
Provider's Weaknesses
18th Edition
86 21 34307785
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1997
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Robert Jiang
Susan Duan
Jack Yang
Marketing Mgr.
Logistics Mgr.
Yingmei Chen
Liz Zhang
CFO
CIO
83
Ticker Symbol
38 **
Exchange:
289
220
2
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
70
Total Other:
Total Reefers:
Total Flatbeds:
0.1
2
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Elements
Technological
Elements
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Flux
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Shanghai
Shanghai
Shanghai
Petroleum Refining
Shanghai
Shanghai
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Chemicals
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Shanghai Dajin
Latin/South America
China
EDITOR'S COMMENTS
Shanghai Dajin Logistics provides warehousing and distribution throughout China. In 2007, it expanded its
service offering by adding chemical logistics and international freight forwarding. These services are provided by
its subsidiaries.
Provider's Strengths
Warehousing and distribution throughout China.
Provider's Weaknesses
Geographical reach.
18th Edition
8610 62295901
COMPANY BACKGROUND
Parent Corporation:
Sinotrans Group
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
PRC's 3PL.
KEY PERSONNEL
Zhang Jianwei
CEO
Gufen Wuliufazhan
Qiao Jichun
Marketing
Logistics
Liu Hongling
Liu Minsheng
CFO
CIO
4,196
858 **
24,084
1000
Exchange:
HKEX
ASSETS
Total Transportation Assets:
Total Tractors:
100
Total Trucks:
Total Trucks:
632
Total Other:
Total Trailers:
Total Aircraft:
100
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
11
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Food, Groceries
Industrial
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Manugistics
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Manugistics
18th Edition
Manugistics, Oracle
Manugistics
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Baosteel
Metals
BASF
Chemicals
Beifa Group
Petroleum Refining
China Unicom
Telecommunications
Coca-Cola
Beverages
Haier
Midea
Samsung Electronics
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
China
China
Asia/Pacific
Europe
North America
Sinotrans
Latin/South America
China
EDITOR'S COMMENTS
For many years, Sinotrans was completely protected by Peoples Republic of China law from direct foreign
competition until recently. In some ways it is a very transparent company. Seventy-six percent of revenues are
derived from freight forwarding. Sinotrans handles 6.7 million TEUs, 422,000 tons of airfreight and handles over 22
million express packages per year.
Sinotrans Limited is a joint stock limited company incorporated in the Peoples Republic of China on 20
November 2002 with China National Foreign Trade Transportation Corporation (Sinotrans Group Company) as its
sole promoter. The Company was listed successfully on The Stock Exchange of Hong Kong Limited on 13
February 2003.
The Groups core services are freight forwarding, express services and shipping agency services and its
support services include storage and terminal services, trucking and marine transportation.
Logistics Development Dept:
Rm. 1313 Jinyun Plaza
A43 Xizhimen North St.
Beijing 100044, P.R. China
Tel: 0086-10-62295845/62295600
Fax: 0086-10-62295627
Email: gufenwuliufazhan@sinotrans.com
Provider's Strengths
Governmental protection.
Provider's Weaknesses
Ongoing upgrade to modern, competitive skill set.
Key Personnel:
Li Renzhi, Deputy General Manager
Chen Aijun, Manager
Beijing-based Sinotrans Ltd. had gross revenues of $5.7 billion in 2008. It has expanded its Sinotrans Integrated Logistics (SIL) business unit
in Shanghai by operating three main regional distribution centers (RDCs). One is in Songjiang District, another in Putuo District, and the one
we visited is in Fengxian District. The Songjiang warehouse is around 10,000 SQM and consists of mainly high-tech products. The Putuo
warehouse is around 17,000 SQM and handles products distributed within Shanghai. The Fengxian warehouse is 48,000 SQM and handles
product distribution throughout China. SIL currently has 280 employees in Shanghai with 130 of them in Fengxian. It plans to increase its staff
to over 600 employees in the near term.
Sinotrans Shanghai is in the process of completing a six warehouse campus in Fengxian totaling 125,000 SQM. The two largest warehouses
started operating in October 2008Warehouse 1 and Warehouse 2. Each warehouse is just under 24,000 SQM and has four subdivisions. Each
subdivision is about 5,000 to 6,000 SQM. The other four warehousesWarehouse 3, 4, 5 and 6each have a 1.45 meter high loading dock on
one side to match container and large truck chassis. Each loading dock has 18 doors. The height inside the warehouse is 9.5 meters and
product can be loaded 5-high in each rack. The warehouse is equipped with U.S. standard fire fighting equipment and has 24-hour closed-circuit
television (CCTV) control.
Key customers of SIL include fast moving consumer goods companies like Auchan, Kraft, Metro, Robust, and Uni-President; automotive
companies like Cooper Tires, Goodyear, and Michelin; and high-tech companies like BenQ, Dell, Hewlett-Packard, and Tsinghua University.
SIL is also developing customers in the cold chain and chemicals industries.
The Fengxian warehouse is near the Waigaoqiao Free Trade Zone, Yangshan Port area and Pu Dong Airport, making it convenient for
export consolidation. SIL has plans to make this a bonded warehouse in the future.
SIL has around 100 trucks (each 4.2 to 9.6 meters long) in Shanghai. Twenty-five of them are in Fengxian. SIL also manages transportation
from Shanghai to Beijing and Guangzhou with subcontractors.
Sinotrans is a leading logistics provider for air, ocean, and inland transportation in China and continues to invest in the development of
Integrated Logistics. We envision that SIL will continue to take the steps to develop into a leading integrated transportation management and
value-added warehousing third-party logistics provider in China.
18th Edition
CHINESE logistics giant, Sinotrans, may sell all or some of its 51 per cent controlling stake in its struggling Grandstar Cargo International
Airlines joint venture.
Sinotrans started the cargo carrier last year with, among other investors, Korean Air, but Grandstar has yet to make a profit or expand
beyond its Tianjin-Frankfurt route. Sinotrans posted a third quarter loss of CNY61.8 million (US$9 million) on the investment.
Contenders to buy the stake include favorite China Eastern Airlines or Air China. China Eastern is already the controlling shareholder of
China Cargo Airlines, which, having just merged with Shanghai Cargo Airlines, has opened up China Eastern to acquiring the parent company
Shanghai Airlines.
The Civil Aviation Administration of China (CAAC) has recently decided to encourage the merger and reorganization of domestic airfreight
companies to consolidate the market.
Signs that there is such a drive are emerging after Chinese police have started to investigate the majority shareholder of Shenzhen Airlines for
economic crimes. In China the term is used to refer to a variety of offences, such as fraud and money laundering.
Li Zeyuan controls 65 per cent of the former state-owned carrier under the title of senior adviser and has been in prison three times for
similar crimes. He has passed his command to Li Kun, the airlines president, until the investigation is complete. Analysts suggest that,
depending on the investigations findings, Li Zeyuan may sell some or all of his stake.
Air China, which owns 25 per cent of Shenzhen Airlines and wants to increase it stake in the company, is paying close attention to the
proceedings.
In 2005, Li Zeyuan beat Air China to his stake of Shenzhen Airlines and it is alleged that it was that bid the police are investigating.
Shenzhen Airlines owns 51 per cent of Jade Cargo, the joint venture it formed with Lufthansa in 2004.
Chinese and US economic slowdowns hit Sinotrans profits
Chinese logistics company Sinotrans Ltd, whose activities include freight multimodal transportation and ships' agency work, among others,
this week reported a less buoyant financial performance in the first half (H1) of 2008, compared to the same period in 2007.
According to the Beijing-headquartered group, that was due to the economic slowdown in the US, combined with rising costs, successive
natural disasters and other factors affecting the Chinese economy. Sinotrans' liner shipping services and a large proportion of its freight
forwarding activities are focused on the transpacific and intra-Asian trades.
In H1 2008, Sinotrans' revenue increased by 13.8% to CNY20.78bn (2.17bn), while operating profit (EBIT) grew by 5.3%, reaching
CNY699.37m (73.31m). That resulted in a return on sales (ROS) of only 3.36%, although that was only slightly lower than the company's
3.63% ROS in 2007.
The 2008 performance represented a considerable slowdown compared to Sinotrans' H1 2006/7 revenue and especially in terms of its EBIT
growth. Last year, for example, the company's revenue increased by 19.7% and EBIT by 30%.
In its freight forwarding business this year, Sinotrans reported 6.7% growth in container volume to 3.33m TEUs, while air freight volume
grew by 2.8 to 211,900 tonnes. However, the company reported a slight decline in its bulk cargo throughput, from 3m tonnes down to 2.9m
tonnes.
A more buoyant performance was reported in its other transport activities. The volume carried by Sinotrans' express services increased by
31.7% and the number of containers handled in the shipping agency business grew by 8.8%. Meanwhile, in the company's liner business,
Sinotrans Container Lines Co Ltd, volume was 10.5% higher at 905,306 TEUs.
In what it termed "complex situations in the domestic and international economic environment, the Sinotrans Group has adopted "a series
of specific measures in pro-active response to market changes. Those moves have included building up its overseas network, continued
enhancements in direct customer marketing and improvements in the quality of operations, amongst others.
Sinotrans also reported that in H1 2008, Chinas GDP increased by 10.4% and the countrys imports and exports by 25.7%, on a year-onyear basis. The container throughput at Chinese ports grew by 17.1%, which was considerably more buoyant than was the case at most of the
largest US container ports in that period.
KSA- Almajdouie, Sinotrans form joint venture
(MENAFN - Arab News Aug. 8, 2008) A leading business house of Saudi Arabia, Almajdouie Group, and Sinotrans Ltd. of China have
signed an agreement to operate a joint venture logistics company in Saudi Arabia. The joint company, named as Almajdouie Sinotrans Middle
East, will operate in the areas of customs clearance, heavy oversized cargo handling and inland transportation services.
"Both groups were working together for past three years in Saudi Arabia and successfully completed the project logistics management
including customs clearance, heavy oversized cargo and inland transportation services by moving equipment for five cement production lines of
Sinoma International Engineering Co. Ltd. in Saudi Arabia and providing quality service by delivering over 500,000 freight tons cargo to the
site," said Abdullah Al-Majdouie, vice president of Almajdouie Group, while speaking on the occasion of the signing ceremony.
Sinotrans President Zhang Jianwei and Vice President Tao Suyun attended the signing ceremony. Al-Majdouie said: "This JV will be the
leader in logistics industry with a goal to have strong presence in Middle East and North Africa (MENA) region, bringing the best quality
services to its customers."
Spelling out the details of the new joint venture operation, Al-Majdouie said that the Almajdouie Sinotrans Middle East will set up the main
office in Saudi Arabia and offer project cargo handling, transportation and project logistics services. "It will gradually move toward GCC and
other Middle East countries, while expanding its operation in a qualitative manner," he added.
Almajdouie Group, a company established in 1965, is leader in supply chain management and third party logistics services, offering general
transportation, heavy/oversized transportation and engineering including lifting and erection, project forwarding, terminal handling, silo
management, warehousing & distribution management, product packaging operations, equipment & maintenance, international freight
forwarding, documentation/import, export and transit clearance contract logistics and tours and travel.
Sinotrans (598.HK) [Transport Thoughts, MerrillLynch, May 27, 2008]
Gao Wei Board Secretary
Li Shichu General Manager
Du Peng Securities and Legal Affairs Department
Sinotrans is a logistics service provider in China, with Rmb 38.8 billion in 2007 revenues, a 21% year-over-year increase. Owing to strong
logistics growth within the country, Sinotrans posted sizable gains in its forwarding, shipping agency, and storage and terminal services, while
18th Edition
marine transportation losses were reduced in 2007. The strong growth was driven by Chinas 23.5% growth in import and export trade, leading
logistics volumes to increase 25.5% year-over-year.
Freight Forwarding, Sinotrans largest business, jumped 27% year-over-year (and now represents 77% of gross revenues, from 74% in 2006),
Express Services grew 9% (8% of revenues), Marine Transportation fell 13% year-over-year (8% of revenues in 06), Storage and Terminals
revenues climbed 16% year-over-year (4% of revenues), Shipping Agency revenues grew 15% year-over-year (2% of revenues), and other
operations climbed 16% year-over-year (2% of revs).
Despite being the largest revenue division, Freight contributes only Rmb 573 million in operating income (a slim 1.9% gross margin, for 41%
of operating income while it contributes 77% of revenues, although margins did improve from 1.5% last year). Thus, Express, with its Rmb 350
million contribution (25% of operating income and 10.6% operating margin (down from 14.9% last year)), and Shipping Agency, with its Rmb
289 million (or 45% margin), are the main profit drivers for the company.
Looking forward: Looking to 2008, Sinotrans management noted uncertainties exist, particularly due to a slowdown in Chinas export
growth (which it expects in the wake of the slowdown in global economic growth), as well as some international trade discords and the ongoing
RMB appreciation.
Freight Forwarding: With revenues of Rmb 30.6 billion, up 27% year-over-year, Sinotrans believes it controls more than a 10% market share
in the Chinese freight forwarding market, competing with global logistics companies and small local forwarders. On the ocean freight side, it has
increased its container TEU moves to 6.4 million in 2007 (+20% year-over-year, accelerating from last years 14% growth), from 5.3 million in
2006 (+14% vs. 2005), 4.7 million in 2005 (+32% year-over-year), and 3.54 million in 2004. It noted that its main competitors are Kuehne +
Nagel, Panalpina, Danzas, Expeditors, Schenker, Maersk Line, APL and local Chinese logistics companies, such as China Shipping Logistics and
COSCO Logistics. Air tonnage cargo was 0.39 million tons, up 6.3% from 2006.
It noted that for 1Q08, airfreight forwarding revenues were down year-over-year owing to the elimination of revenues that were consolidated
due to the Excel-Sinotrans joint venture that was deconsolidated upon the DHL/Excel merger. Aside from the accounting shift, it noted that
revenues remained strong.
Express Shipping of low margin goods has slowed: Express revenues were Rmb 3.31 billion, up 9% year-over-year. While Express
represents only 8% of revenues, it contributes 25% of operating income. Sinotrans noted that less than 10% of its revenues are derived from
domestic services (we estimate this to mean 7%-8% of its revenues) with the remaining 92%-93% from profitable international services. This
was an increase from last years 5% of Express revenues being derived from domestic, highlighting that business rapid growth.
This increase would indicate that domestic revenues jumped 64%, to Rmb 249 million of revenues, from RMB152 million in 2006, while
international revenues increased 6%, to Rmb 3.07 billion. It noted that the shipping of low margin goods has slowed while machinery goods
continue to grow at a robust pace.
Overall, Sinotrans posted Express volumes of 19.2 million packages (+24% year-over-year from 15.5 million in 2006 (which was up +33%
year-over-year from 11.7 million in 2005). Sinotrans noted that the international volumes continued to grow at close to double-digit rates, but
growth has decelerated over the past 2 years. It noted the domestic market remains significantly larger than the international market in terms of
package flow, with China Post holding the largest market share at more than 50%, Sinotrans the next largest, FedEx has a small market share,
and the rest is with smaller companies. It noted that overall Express revenue growth was slower than package growth because of the robust
growth in its domestic segment, which has significantly lower revenue per package. In the international market, Sinotrans believes it has a 30%
share of China export volumes.
It noted that while less than 10% of revenues were from domestic operations, more than 33% of packages were from its domestic
operations. Of the 19.2 million packages shipped, that would leave 12.9 million derived from international operations. With a 30% international
export market share, that would indicate the export market is 43 million packages/year, or 161,700 per day.
Sinotrans has a 30-year contract with its joint-venture partner, DHL. It previously had a relationship with UPS, which ended when UPS
purchased its JV to provide its own international express service. To develop its express service, the company has set up a 51% owned JV with
Korean Air to provide air lift capability.
Aside from FedEx, TNT, DHL, and UPS, its main domestic competitor is EMS (Express Mail Service). It noted the domestic market is quite
sizable, but believes there are too many local competitors (with flexible business policies) to be able to achieve its target of 10% margins.
Marine transportation: Sinotrans also acts as an agent for shipping companies, which represents 8% of its revenues at Rmb 2.96 billion. The
division lost Rmb 148 million in operating income (a 5.0% negative contribution), but an improvement from last years Rmb 250 million in
losses. The company believes its ongoing shift to focus on intra-Asia will boost returns, and with 70-80 vessels under its management, Sinotrans
continues to charter-in 1,000-2,000 TEU vessels to meet demand within the intra-Asia lane. Within this division, it recently decreased capacity
flowing to Long Beach and Oakland in order to continue cutting its cost. Sinotrans handled 12.2 million TEUs in 2007, up 21% year-year.
Ocean Rates: As Sinotrans buys capacity from ship owners, it provided solid insight into current rates. In 1Q08, rates between China and
Europe and intra-Asia continued to increase (with rates intra-Asia up 30%), with the strength due to rising oil prices and strong demand.
However, rates between China and the U.S. continued to fall, dropping 4%, and it noted a softening of rates between Asia and Europe in April.
It also noted that there is overcapacity at Chinas main ports in the near-term.
Strong free cash flow: Management noted that with its solid cash flow, 6% cost of debt (vs. 10-12% hurdle rate), it continues to look for
investments. It has Rmb 4-5 billion of cash, Rmb 3-4 billion of capex, Rmb 1-2 billion of working capital needs, yet remains a significant cash
flow generator.
Sinotrans will streamline China operations
Sinotrans has said it will integrate dozens of its smaller subsidiaries into two listed firms by 2010 as it prepares for an IPO (initial public
offering) in Hong Kong later this month that could be worth up to US$1.69bn. The smaller companies are to be merged into Sinotrans Shipping
and its existing Hong Kong-listed company with Sinotrans Shipping to become the groups bulk shipping flagship. According to the company,
the consolidation will help boost the total turnover of the Sinotrans Group to a forecast $10bn by 2010. Sinotrans Shipping has priced its offer
at 12 to 14 times the firms 2008 earning forecast of $300m. Trading in the shares will start on November 23 and seven cornerstone investors
have already subscribed for a total of $175m worth of shares and will very likely make a great deal of money. These include Li Ka-shing, one of
Asias richest men and chairman of Hutchison Whampoa, controller of leading port operator Hutchison Port Holdings. Other key investors are
three Chinese shipping and port giants China Cosco Group, China Shipping Group and China Merchants Group together with Ping An
Insurance, Lee Shau-kee, chairman of Henderson Land Development, and hedge fund Citadel Investment Group.
Sinotrans profits fall as shipping division struggles
Chinese logistics group Sinotrans has released its annual results. The group's turnover amounted to RMB32,220.9 million (3,127m) in 2006,
up by 12.75% from RMB28,576.8 million (2,774m) for the corresponding period in 2005. Management stated that the increase was primarily
18th Edition
attributable to the group's further integration of marketing resources and development of new products, improvement of network plans and
increased business process standardization. Each business of the group maintained its rapid growth.
Turnover from the group's freight forwarding services amounted to RMB24,118.7 million (2,341m) in 2006, rising by 15.82%. The volume
of sea freight forwarding containers carried was 5.3 million TEUs in 2006, jumping 13.73% from 4.66 million TEUs in 2005 and cargo tonnage
of air freight forwarding services was 0.3695 million tonnes, rising 2.52% from 0.3604 million tonnes in 2005.
During 2006, turnover of continuing operations from express services posted RMB3,038.1 million (294m), an increase of 23.51% from
2005. The number of documents and packages handled through express services of the group was 15.49 million units, a rise of 32.73% over
11.67 million units in 2005.
Turnover from marine services of the group in 2006 amounted to RMB3,379.9 million (328m), falling 14.45% from RMB3,950.6 million in
2005. The number of containers shipped by the group rose to 1.525 million TEUs in 2006, up by 11.23% from 1.371 million TEUs in 2005.
The group's operating profit was RMB984.8 million (95m) in 2006, representing a decrease of 19.60% from 2005, mainly as a result of the
operating losses in marine transportation. For 2006, operating profit as a percentage of total revenue decreased to 3.04% from 4.27% in 2005.
18th Edition
86 532 55578600
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2002
Asset Focus:
Market Area:
Founding Business:
International
Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Albert Yue
Managing Director
Jason Cui
Kevin Zhang
Marketing Mgr.
Logistics Mgr.
Raul Zhang
Rossella Lv
CFO
CIO
Ticker Symbol
38
6 **
140
140
3
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
519
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Elements
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Cargo 2000
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Cargo 2000
18th Edition
Cargo 2000
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
ABB
Industrial Machinery
Baosteel
Metals
China Petroleum
Petroleum Refining
Reliance Industries
Energy
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Smart Cargo
Latin/South America
China
EDITOR'S COMMENTS
Qingdao Smart Cargo International Services was established in 2002 and specializes in break bulk, heavy lift,
and project cargo. Most of its customers are in the Industrial and Elements vertical industries.
Provider's Strengths
Provider's Weaknesses
18th Edition
01 34 40 29 03
COMPANY BACKGROUND
Parent Corporation:
Astorg Partners
Asset Focus:
Market Area:
Founding Business:
Europe
Warehousing
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Jean-Pierre Masse
Ccile Carrara
Thomas Mortier
Communications Director
Business Director
Brigitte Andreolis-Clavier
Olivier Thomas
Finance Director
IS Director
207
Ticker Symbol
207 **
Exchange:
1,000
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
2.7
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Augusta II
18th Edition
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Citron
France
Court Paille
Publishing, Printing
France
Monroe
France
Renault
France
Ultrafilter
Industrial Machinery
France
Yamaha Motor
Transportation Equipment
France
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
STACI
Latin/South America
Benelux
France
Italy
Poland
Spain
EDITOR'S COMMENTS
STACI is a B2B warehousing and distribution 3PL of non-core products/non-commercial goods. STACI supplies
marketing and related materials to agents, dealers and customers.
Provider's Strengths
Business-to-business fulfillment.
Provider's Weaknesses
Size and scope.
18th Edition
56-32 220-1481
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1985
Asset Focus:
Market Area:
Founding Business:
International
Port Services
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Vctor Pino T.
Executive Director
T Christin Irarrzaval T.
Felipe Rioja R.
Roberto Larran S.
Guillermo Aguirre S.
Finance Mgr.
Systems & Communications Mgr.
103
Ticker Symbol
103 **
Exchange:
1,200
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
20
Total Ocean:
Total Other:
10
1.3
Total Tankers:
Total Other:
10
MAJOR MARKETS
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Food Production
Chile
Food Production
Chile
Chile
Beverages
Chile
Beverages
Chile
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
Sudamericana Agencias
North America
Latin/South America
Mexico
Brazil
Chile
Colombia
Costa Rica
Ecuador
Guatemala
Peru
Uruguay
United States
EDITOR'S COMMENTS
SAAM handles the preparation and coordination of imports and exports received at the numberous port
locations it operates throughout Latin and South America. Additional services provided include clearance,
stevedoring, bulk handling, container repair and a tugboat fleet of over 80 tugboats.
Provider's Strengths
Port services.
Provider's Weaknesses
18th Edition
852-2947-7667
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2000
Asset Focus:
Market Area:
Founding Business:
Asia Pacific
Logistics
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Karen Lee
GM
Almon Yu
Wallace Chan
GM
Asst. Logistics Director
Andi Hui
10
Ticker Symbol
10 **
Exchange:
100
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
10
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Microsoft Axapta
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Microsoft Axapta
18th Edition
Microsoft Axapta
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
CUSTOMERS
18th Edition
Asia/Pacific
Australia/New Zealand
Europe
Latin/South America
North America
Asia/Pacific
Europe
North America
Sun
Latin/South America
Hong Kong
Macau
EDITOR'S COMMENTS
Karen Lee seems well connected. The Macau expansion should help.
Provider's Strengths
Entrepreneurial spirit.
Provider's Weaknesses
Size.
What Karen Lee doesnt know about logistics could be written on the back of a postage stamp. She is the third generation of Lees who grew
up in the industry, learning all there is to know about the business from her father, Simon Lee, who in turn learned the trade from his father, Lee
Chi-hung, founder of the Sun Hing Group.
When the business was founded in 1945, logistics was then known as warehousing and shipping. Today, on the eve of its 60 anniversary, the
Sun Hing Group is a model of how businesses can ensure a bright future for themselves by embrace change. This is clearly illustrated in the
groups latest business venture, Sun Logistics, a 50:50 joint venture with Sun Hung Kai Properties, which Ms Lee has steered as General
Manager of the company since its establishment in 2000.
She says the partnership is a continuation of a close working relationship that the two partners have enjoyed since the mid-1980s, which
sprung out of a casual chat between the Chairman of Sun Hing Simon Lee and the late Chairman of Sun Hung Kai Properties Kwok Tak-seng
at a dinner reception. At the time, Hong Kong manufacturers were migrating north, and in their wake many godowns were left abandoned. The
late Mr Kwok asked Mr Lee if he had any use for a warehouse he had in Fo Tan, and after further meetings the two entrepreneurs decided to
form a warehousing join venture which continues to this day.
Towards the end of the 1990s, warehousing and shipping was starting to become a fine art. In the late 1990s, we looked at supply chain
management trends in the U.S. and Europe, and realised the logistics business was undergoing an evolution, Ms Lee said.
The rise of e-commerce triggered the shareholders to think how they could get involved in this business by offering onestop solutions for
inventory management, delivery and packaging by making full use of information technology.
The shareholders originally thought of calling this new business Sun Hing Warehousing, but thought that it sounded rather old fashioned,
she says. In the end, we decided to form a new company with a totally new image and in May 2000 Sun Logistics was born.
The biggest hurdle for the company was and remains convincing businesses that supply chain management is essentially just a new, more
efficient way of doing an old business.
We spend a lot of time talking about supply chain management and outsourcing logistics tasks, but many businesses still dont appreciate
the fact that if you want to succeed in business you have to carefully monitor your inventory, she says. In this regard, we are still behind
Singapore and Australia when it comes to supply chain management and logistics development.
Another challenge was peoples unrealistically high expectations about e-logistics. Because the company was born at the time of the dotcom bubble, businesses thought that they could track every product in real time and that consignments would arrive at their destination
overnight, she says.
The hottest topic sweeping through the logistics industry today is radiofrequency identification (RFID) a technology that will allow
companies to pinpoint the exact location of their goods at any time, anywhere in the world says Ms Lee. Logistics companies are already on
cloud nine dreaming up uses for the breakthrough technology, but when ubiquitous RFID arrives in the next few years, most Hong Kong SMEs
will not be able to take advantage this marvel of ingenuity.
The good news ironically is that the cost of implementing RFID is still prohibitively expensive, even for large firms. She expects the cost
will drop in three years to a level where it will be more cost effective. During this time, SMEs will have a window of opportunity to put their
inventory control systems in order and catch up to a level where they will be able to use RFID.
Companies are increasingly coming to grips with inventory management as they look at different areas to save costs, says Ms Lee. However,
18th Edition
SMEs are often reluctant to ask for assistance, as they think logistics service providers are only interested in working with larger businesses.
We are a bit different from other logistics companies, as besides multinationals, one of our most important markets is the SMEs, she says.
Their needs are usually quite straightforward, and as we provide almost every service SMEs need warehousing, inventory management, various
packaging solutions, distribution, customer service, and e-logistics development and support the efficiency and benefits that we can provide to
SMEs are far more significant that those of big companies. So at the end of the day, we can provide them with the services that they require at
minimal cost.
She also believes that many SMEs are cautious about enquiring about such services after being burnt by unscrupulous software vendors.
Many SMEs didnt get what they paid for, so their software ended up just sitting on the shelf, Ms Lee says. In my view, it is critically
important to have the right business knowledge. You cannot simply buying off-the-shelf software to manage your companys logistics needs, it
has to be tailored to your own circumstances. And because many SMEs do not have an IT manager in house, they are often at the mercy of
these companies that sell solutions and leave the SMEs to figure it out themselves.
18th Edition
55 11 4346-2533
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1998
Market Area:
Founding Business:
Asset Focus:
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Gennaro Oddone
CEO
Emanuel Balaz
Jos Roberto Salom
Marketing Mgr.
Logistics Mgr.
Alexandre Brando
679
343 **
Exchange:
3,143
3-7
Bovespa
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
1,600
Total Other:
Total Trailers:
Total Aircraft:
2,400
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
16.1
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Food, Groceries
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): RDC
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Alcis
Proprietary
Datasul
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Apple
Brazil
Daimler
Brazil
Ford Motor
Brazil
General Motors
Brazil
Globalstar do Brasil
Telecommunications
Brazil
Hewlett-Packard
Brazil
Honda Motor
Brazil
Officer.com
Brazil
Renault
Brazil
Shell Chemicals
Petroleum Refining
Brazil
Toyota Motor
Brazil
Unilever
Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Tegma
Latin/South America
Brazil
Uruguay
Venezuela
EDITOR'S COMMENTS
Tegmas strength is in the automotive industry. Tegma transported over 900,000 vehicles in 2007. Services
include vehicle inspection, accessory installation, licensing, and used vehicle auctions. Major customers are: Ford,
GM, Honda, Renault, Toyota, and Volkswagen.
In early 2007, Tegma integrated the operations of Coimex Logstica Integrada and Boni/GATX to strengthen
and diversify its portfolio.
Provider's Strengths
Modern 3PL with good Brazilian coverage.
Provider's Weaknesses
So Paulo, February 12, 2009 To consolidate its position as one of the countrys largest logistics operators and reach the planned revenue
of R$2 billion in 2011, Tegma Logstica is already doing its homework. Achieving the target is a difficult task, but not impossible. After all, the
companys net revenue between January and September this year was R$751.8 million, as against R$744.9 million in the twelve months of the
previous year.
One of the tasks to continue to grow amidst the crisis is to gradually reduce the importance of the automotive chain in revenues by
diversifying cargoes and operations.
It is certainly no easy task. Based in So Bernardo do Campo in the So Paulo state, close to the countrys major car makers, most of Tegma's
revenues come from the automotive business. For example, it is the countrys largest carrier of brand new cars. In July, August and September
this year, it transported 289,300 cars, 15.5% more than in the same months last year.
The company did not wait for the crisis to diversify itself. It had begun the transformation long before the crisis hit, with the milestone being
the Companys IPO, which leveraged the acquisition of three transport and logistics companies - Boni GATX, CLI and CTV.
Dedicated cargo
In line with its reasoning of putting eggs in different baskets so as to grow with diluted risk, the company devised what it christened the Shell
Project. It is an agreement, tailored last year and already in operation, which involves the purchase of 115 B-train trucks. The task is to
transport lubricants and aviation fuel, says Gennaro Oddone, Tegmas CEO since 2003, who joined the company in 1999 as CFO.
Dedicated agreements are characterized by maximum productivity vehicles may be on the road round the clock with up to three drivers. In
addition to fuel, the diversification includes orange juice, pulp and paper, and logistics services. Net revenue excluding the automotive sector was
R$50.4 million, 50.5% higher than in the third quarter of 2007.
Progress on other fronts has helped to reduce the impact of the decline in the automotive sector. "We know that our operations will be hit
hard in the short run. It was a sudden decline and we have to inevitably adapt to the reduced demand." As part of the adaptation process, Tegma
laid off 330 employees, 10% of its staff. We are prepared to grow in the automotive area and in other cargoes, he says.
We are looking for new exclusive agreements, he adds. Transport still represents 80% of our revenues, but logistics (20%) has excellent
18th Edition
growth potential because companies tend to outsource this type of activity in times of crisis."
Tegma, which went public in 2007, is the aggregate of several companies. It was founded 40 years ago (1969) as Sinimbu, a transporter of
brand new cars.
The first big change occurred in 1998, when it merged with Allied Holding and the Coimex Group, and later absorbed the transport
companies Schlatter and Transfer.
The next step was in 2001, with the acquisition of Translor Veculos, the outbound division of Ryder do Brasil. In 2002, it acquired Allied
Holdings interest in the company and adopted the name Tegma.
Tegmas controlling shareholders are the Itavema-Sinimbu Group, which operates in the car dealership, car rentals and packaging segments,
and the Coimex group, which operates in exports and imports, port operations, real estate, highway and energy concessions, and purchasing
pool operations (consrcios). Other shareholders own close to one third of the companys capital.
Tegma Logstica declares the acquisition season opened
After going public and raising R$600 million on the stock exchange, Tegma Gesto Logstica, headquartered in the Frango com Polenta
route in the city of So Bernardo do Campo (So Paulo), declared officially opened the season for acquiring companies that operate load
transportation, inventory management and storage activities.
Out of the funds raised, R$300 million were set aside from the primary issue, for the acquisition of companies that promote Tegmas
expansion, currently rated among the major logistics operators in the Country with estimated sales of R$680-720 million for 2007.
Tegma was born from the integration among companies, in 1998, with the name Axis Sinimbu, a product of the unification of logistics
operations of three of the most traditional carriers: Schlatter, Sinimbu and Transfer, specialized in the automotive logistics activity, particularly
new cars.
In 2001, Axis Sinimbu gave another step towards consolidation when it purchased Ryder, the new vehicles transportation arm that pertained
to Translor Veculos, established in 1958 by the businessman Walter Lorch. The U.S. company Ryder, one of the worlds largest carriers,
acquired Translor, but did not keep the new car transportation business.
Dominance in new vehicles
Tegma adopted its current name in 2002, with two partners, the Coimex group and Itavema-Sinimbu. Since the going-public process, these
two groups now hold two thirds of the capital. The other third is with the market. The major business is the transportation of new cars. Tegma
transports one third of the cars produced.
The transportation fleet used by Tegma to a great extent focused on car transportation is of 2.5 thousand pieces of equipment, 90% of
which belonging to third-parties, the so-called cegonheiros, certainly one of the strongest categories among Brazilian truck drivers in terms of
growing, high value-added, captive load, which allows for fairly high freight fees and steady renovation of trucks.
Internationalization phase
Last year, Tegma managed the transportation of 730 thousand vehicles, around one third of the production of cars and light commercial
vehicles. In 2007, the company will also account for one third of the vehicles carried, the equivalent to approximately 900 thousand units.
Following its policy of consolidating and expanding to gain scale, Tegma gave its first step towards the operational internationalization when
at the end of September it debuted in the Venezuelan new car transportation market, incorporating Tegma Venezuela. The Brazilian company,
owner of 25% of the capital, is responsible for the administrative and operating management. The business strategy will be resolved in joint
decisions with the Venezuelan partners, businessmen from the automotive industry and who incorporated the Promotora Quinta Rueda C.A.
This is the right moment to enter into this market. The Venezuelan vehicle market has grown in the first eight months of the year, 52.5%,
with 302,853 units. This partnership with local investors will help us getting to know an important Latin American market, where we will
initially serve our main customer, General Motors, said Tegmas CEO, Gennaro Oddone. The expectation is to expand our participation to
other car makers.
80% of Tegmas revenue derives from the automotive chain new car transportation and management of car makers parking yards and
inventories. The remaining 20% derives from other segments. The trend, according to Oddone, is a growth in transports and logistics operations
off the automotive segment situation that is expected to take place with the recent merger of Boni/Gatx and of CLI (Coimex Logstica
Integrada). These two companies increased Tegma Logsticas revenues by 20% in a first moment.
Inevitable Consolidation
Tegma covers several sectors. In addition to transportation in the automotive chain, the company carries chemical products, orange juice,
pulp and paper, oil byproducts, alcohol and frozen products. It also manages inventories for the telecom, pharmaceutics and electric home
appliances industries. Transportation is our main driver, accounting for 80% of our sales.
According to Oddone, the consolidation is inevitable in order to grow. Within five years, the market will have a group of large companies,
not more than twenty, with revenues over R$1 billion, capable of following the logistics evolution and meeting customers wishes and
requirements, he adds. One must have scale in order to maintain an area of software projects, where we have eight engineers, he says.
Tegma shares become a new option for investors
Tegma Gesto Logstica presented yesterday the terms of its public offer, which may exceed R$ 640 million. The operation, which was
coordinated by banks JP Morgan and Unibanco, comprises the primary and secondary issue of 20.2 million common shares, which will list the
Company on Bovespas Novo Mercado. The issue price should range between R$ 26 and R$ 32 per share.
Individual investors who are interested in taking part in the offer should file a registration request with the brokerage house from June 19 to
28. The minimum and maximum investment values are R$ 5 thousand and R$ 300 thousand, respectively. Shares make their debut on July 3. Of
the total offered value, 9,706,639 shares correspond to the primary offer, which may increase the Companys cash by R$ 300 million. According
to the prospectus, the largest portion of these funds is aimed at future acquisitions. The 10,493,361 remaining shares are owned by the seller
shareholders, a block formed by individual controlling shareholders of the Itavema-Sinimbu Group, and by Coimex Trading and CAG, both
controlled by the Coimex Group. With the offer, 30% of the companys capital is transferred to the market. The Itavema-Sinimbu Group has
one of the largest concessionaire networks in the Country, and accounted for the sale of 40 thousand vehicles in 2006. The group also acts in the
plastic packaging, vehicle rental for outsourcing segments and insurance brokerage for management of the group companies policy portfolio.
18th Edition
With 59 years of activities, the Coimex Group operates in the areas of distribution and port logistics, with the purpose of serving the oil
exploration and production offshore operations. In addition, it operates in the foreign trade sector and invests in the energy, highway
concessions, car, motorcycle and real estate consortium sectors.
The company was founded in 1998 as Axis Sinimbu, from the unification of the logistic operations of Schlatter, Sinimbu and Transfer. In
2001, the company acquired Transvalor, a pioneer in the new vehicle transportation sector. The company was named Tegma in 2002, and its
current shareholders are Coimex and the Itavema-Sinimbu Group. Tegma is an integrated logistic provider operating in the transportation,
storage, control and management of inventories and in the development of logistic solutions in several economic sectors.
[via website, 3/01]
One of our specialties is to manage supplies, making information available to our client in real time. Thus, we count on very modern
equipment, trained professionals, system of integrated information, structure of more than 750.000 square meters for common storage, customs
and services for the adequacy of goods to the Brazilian market.
Coimex Armazns Gerais S.A is certified under the norms of ISO 9002 for all its storage processes and vehicle and cargo movement,
counting on the support of PDI Comrcio, Indstria e Servios Ltda., which has the capacity to inspect up to 300 vehicles a day.
The search for better solutions has driven Grupo Coimex to develop procedures perfectly tuned to each client's strategy.
Through Coimex Logstica Integrada S.A., an allied company, we provide all the necessary support to storage, consolidation and distribution
of goods to the whole country making use of the most modern technology of system support and information technology resources
18th Edition
55 11 4221-4393
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1935
Asset Focus:
Market Area:
Founding Business:
International
Customs Brokerage
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Hermeto Bermudez
CEO
Fabio Bermudez
Marcelo Motta
CFO
Country Mgr. Mexico
24
Ticker Symbol
16 **
Exchange:
405
11
4
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS):
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
Freight Bill Audit/Payment Software:
ERP/Order Management System:
Other Systems Capabilities:
Bar Coding
Demand & Supply Forecasting
18th Edition
RM Sistemas
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Chemicals
Argentina, US
Dana
Brazil
Delphi
Brazil
Ford Motor
Brazil
General Motors
Brazil
Nestle
Brazil
Petrobras
Petroleum Refining
Brazil
Pirelli
Argentina, Mexico
Rhodia
Brazil
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Chemicals
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
Tito
North America
Latin/South America
Mexico
Argentina
Brazil
United States
EDITOR'S COMMENTS
Tito has operations in Argentina, Brazil, Mexico and, as of 2005, the United States. The opening of its U.S.
location was basically intented for companies engaged in reciprocal trade between the U.S. and Latin America. In
Mexico, Tito offers a full range of import, export, customs consultancy and cargo handling management services.
Tito also has service capabilities in Europe and Asia through an agent network.
Provider's Strengths
Customs clearance.
Provider's Weaknesses
Size and scope.
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
International
Freight Forwarding
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Hugh Cushing
CEO
Paul Coutts
Myles O'Brien
Brian Kruger
Tom Thompson
CFO
CIO
717
Ticker Symbol
136 **
Exchange:
4,200
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): IPACS Logistics 2000
Transportation Planning and Optimization:
Warehouse Management System (WMS):
IPACS
EXE WMS
18th Edition
IPACS
IPACS
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Various
Telecommunications
Asia
Various
Germany
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
North America
Bahrain
China
Australia
France
Canada
Jordan
Kuwait
Hong Kong
New Zealand
Germany
United States
Africa/Middle East
Lebanon
Oman
Asia/Pacific
India
Netherlands
Indonesia
Sweden
South Africa
Syria
Malaysia
Sri Lanka
Latin/South America
United Kingdom
Macau
Qatar
Singapore
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Warehousing and exhibition operations are primarily in Singapore and major Chinese cities. Gross margin (net
revenue) runs 19%. Airfreight is 52% of the business, sea freight is 39%, exhibitions 4% and third-party logistics
5%. The Asia Pacific region represents 43% of its revenues, Europe and Australia/New Zealand each 20%, the
Americas 9% and Africa 8%.
In March 2008, Toll took over BALtrans, a large intra-Asian freight forwarder with operations to the United States
and Europe. Toll has rebranded BALtrans as Toll Global Forwarding.
In February 2010, Toll acquired Summit Logistics International to integrate it into Toll Global Forwarding and
expand its capabilities in the Greater China to U.S. trade lane.
Provider's Strengths
Freight forwarding.
Provider's Weaknesses
AUSTRALIA'S Toll Group has made a major step forward in its ambition to become one of the largest freight forwarders in the UK after it
announced the acquisition of Genesis Forwarding Group and WT Sea Air Group. This is the first time there has been a double purchase of large
UK independents.
"These two UK headquartered acquisitions combine to provide significant scale to our Toll Global Forwarding (TGF) division in Europe,"
said Toll Group's managing director, Paul Little. "WT is expected to generate revenue this year of around A$170 million (US$148 million) and
Genesis is expected to generate around A$80 million ($70 million)."
Genesis has a strong UK-export business and also specializes in mission-critical international multi-modal freight, predominantly for the
defense, aerospace and oil and gas industries across Europe, the US, Asia Pacific and the Middle East. In the 2009 IATA CASS rankings,
Genesis was ranked 22nd largest UK forwarder.
WT is principally a UK-import business from Asia, which also has a division in Hong Kong, specializing in global forwarding of fashion
items. It also markets value-added services such as bonded warehousing, pick-pack, garment re-hanging, vacuum packing and final-mile delivery
services.
The deal was supervised by Toll's new head of global development, Chris Fahy.
Toll also announced that it has sold its 50 percent share in the Italian Pacorini-Toll Joint Venture to the Pacorini Group. The venture
provided logistics for the metals industries.
"While the joint venture has been a successful business since its formation, it was decided that the ownership interest was not a core asset for
Toll," said Little.
"Importantly, Toll will continue its relationship with Pacorini through the provision of warehousing and other logistics services.
Toll buys two UK companies, sells stake in metal logistics JV
Toll Group has announced its intention to acquire two freight forwarding companies in the UK and divest its investment in Pacorini Toll - a
joint venture with the Italy-based Pacorini Group.
Toll plans to acquire WT Sea Air Group (WT) and Genesis Forwarding Group (Genesis) - in two deals that, combined, are expected to
generate revenue of more than A$250 million for Toll.
According to Toll's managing director Paul Little, the two UK-headquartered acquisitions will provide significant scale to the Toll Global
Forwarding (TGF) division in Europe.
WT is principally a UK inbound business from Asia specializing in the provision of global forwarding and value added services such as
bonded warehousing, pick-pack, garment re-hanging, vacuum packing and final mile delivery services.
Genesis provides complex and mission-critical international multi-modal freight, predominantly in the Defense, Aerospace and Oil & Gas
industries across Europe, the US, Asia-Pacific and the Middle East.
The Toll Group operates in 55 countries, and, since the BALtrans acquisition in 2007, has continued its global expansion with a string of
acquisitions:
2010:
18th Edition
Qantas has announced the sale of its shareholding in Asia-based freight and courier business DPEX Worldwide to Toll Holdings. The sale
excludes the airline's stake in the DPEX Australian operation.
The transaction is in line with Qantas Group's ongoing strategy of focusing on core business areas, and with Toll's growth strategy for the
Toll Global Express (TGX) division.
"DPEX will support Toll's ongoing growth and development in the region," said Toll Group's managing director Paul Little. "It is an
important addition to TGX's Asia Pacific operations that acquired Deltec, Skynet and Kwikmail businesses in the middle of last year, and will
provide additional scale and coverage across a network of nineteen countries in Asia."
The expansion of the Toll Priority network throughout Asia is a key component of the Toll Global Express strategy. Toll Priority and DPEX
will leverage each other's capabilities and customers to further accelerate growth - both regionally and globally - within this key international
express freight market.
The DPEX acquisition will provide more than A$30 million in revenue for Toll.
Completion of the transaction is subject to approval by China competition authorities as a result of both Qantas and Toll having significant
unrelated existing interests in China.
Toll Group acquires Concord Park
Toll Group has announced its acquisition of the assets of Concord Park, a privately owned interstate transport company.
With revenue of around A$90 million, Concord Park offers distribution, third party logistics, timeslot deliveries into distribution centers,
overnight express deliveries and bulk line-haul services across Australia.
The business combines FTL and LTL services, and, according to Toll Group managing director Paul Little, the company will be a valuable
addition to Toll following its integration into the Toll Express business.
This follows Toll's recent A$80 million acquisition of US freight forwarding company, Summit Logistics International.
In other news, Kmart Australia has entered into an agreement with Toll in2store to manage its new Victorian Distribution Centre.
Fahy returns to the industry with Toll Holding
Air Cargo News understands that Chris Fahy (right), the former chief executive officer of DHL Global Forwarding, has made his longanticipated return to the logistics business by taking up the role as global development director, within the Toll Group.
Fahy controversially left DHL in March 2008, after a management restructuring of the business units, and has since been acting as an advisor
for a number of organizations, including Toll, over the past nine months and contributing to UK parliamentary discussions on retail, automotive
and banks.
In his new role, Air Cargo News has been told Fahy will be responsible for the mergers and acquisitions of the ambitious Toll Group and its
future global footprint.
Toll still on acquisition trail
he said.
Volumes appear to be improving, and the company is well placed to take advantage of anticipated more buoyant economic levels.
Toll buys US freight forwarder for $80m
Toll Holdings has acquired US freight forwarder Summit Logistics for about $80 million.
Logistics provider Toll Holdings has acquired US freight forwarder Summit Logistics for about $80 million.
Summit, which provides ocean freight services on the trans-Pacific route between China and North America, generates annual revenue of
around $300 million, Toll said in a statement.
Summit also generates about 30 percent of its revenue from the provision of transport and logistics services to its freight forwarding
customers within the US.
"We have been investigating US-based opportunities for some time, and this is an important acquisition for the group in the global
forwarding market," Toll managing director Paul Little said.
"The development of significant scale in the trans-Pacific trade lane is a key element of delivering price-competitive services to US-based
customers.
"Importantly, integrating Summit into Toll Global Forwarding also improves Toll's total supply chain capability in the US market."
The acquisition of Summit is expected to add to Toll's earnings per share in the first year of ownership by Toll.
Toll shares closed 10 cents lower at $8.48 on Tuesday.
18th Edition
61 3 9694 2880
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1888
Asset Focus:
Market Area:
Founding Business:
International
Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
Very good integrated logistics service provider with broad Asian coverage.
KEY PERSONNEL
Paul Little
Managing Director/CEO
Andrew Ethell
Wayne Hunt
CFO
CIO
5,129
4,052 **
Exchange:
30,000
>1000
<10
ASX
ASSETS
Total Transportation Assets:
Total Tractors:
15,000
Total Trucks:
Total Trucks:
5,000
Total Other:
Total Trailers:
Total Aircraft:
25,000
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
32.3
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Industrial
Technological
Elements
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Abbott Laboratories
Pharmaceuticals
Singapore
Amway
Advertising, Marketing
India
Singapore
Military, Government
Australia
Bridgestone
India
Colgate-Palmolive
ConocoPhillips
Petroleum Refining
Ford Motor
Australia
General Electric
Diversified Financials
Gillette
China
GlaxoSmithKline
Pharmaceuticals
India
Holden
Australia
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Europe
North America
Bahrain
China
Australia
France
Canada
Jordan
Kuwait
Hong Kong
New Zealand
Germany
United States
Africa/Middle East
Lebanon
Oman
Asia/Pacific
India
Netherlands
Indonesia
Sweden
Latin/South America
United Kingdom
Japan
Qatar
Toll Group
South Africa
Syria
Macau
Philippines
Malaysia
Singapore
South Korea
Sri Lanka
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Seventy-five percent of Tolls revenues are Australian based where Toll has one of everything in logistics. Tolls
mission is to be the most successful provider of integrated solutions to the Asian region providing customers with
global reach. Its largest vertical industry is Retail/FMCG, which accounts for 45% of its revenues.
Sixty percent of SembCorp was acquired in 2006 by Toll Holdings which owns Australias largest trucking and
distribution operations. SembCorp is one of the largest logistics providers in Asia. SembCorp has extensive Asian
operations (16 countries) and a sizeable joint venture (St. Anda) in China. Its revenues are split as follows:
Northern Asia, 53%; Southeast Asia, 41%; others, 6%.
In March 2008, Toll took over BALtrans, a large intra-Asian freight forwarder with operations to the United States
and Europe. Toll has rebranded BALtrans as Toll Global Forwarding.
In February 2010, Toll acquired Summit Logistics International to integrate it into Toll Global Forwarding and
expand its capabilities in the Greater China to U.S. trade lane.
Provider's Strengths
SCM and distribution in southeast Asia and India.
Provider's Weaknesses
AUSTRALIA'S Toll Group has made a major step forward in its ambition to become one of the largest freight forwarders in the UK after it
announced the acquisition of Genesis Forwarding Group and WT Sea Air Group. This is the first time there has been a double purchase of large
UK independents.
"These two UK headquartered acquisitions combine to provide significant scale to our Toll Global Forwarding (TGF) division in Europe,"
said Toll Group's managing director, Paul Little. "WT is expected to generate revenue this year of around A$170 million (US$148 million) and
Genesis is expected to generate around A$80 million ($70 million)."
Genesis has a strong UK-export business and also specializes in mission-critical international multi-modal freight, predominantly for the
defense, aerospace and oil and gas industries across Europe, the US, Asia Pacific and the Middle East. In the 2009 IATA CASS rankings,
Genesis was ranked 22nd largest UK forwarder.
WT is principally a UK-import business from Asia, which also has a division in Hong Kong, specializing in global forwarding of fashion
items. It also markets value-added services such as bonded warehousing, pick-pack, garment re-hanging, vacuum packing and final-mile delivery
services.
The deal was supervised by Toll's new head of global development, Chris Fahy.
Toll also announced that it has sold its 50 percent share in the Italian Pacorini-Toll Joint Venture to the Pacorini Group. The venture
provided logistics for the metals industries.
"While the joint venture has been a successful business since its formation, it was decided that the ownership interest was not a core asset for
Toll," said Little.
"Importantly, Toll will continue its relationship with Pacorini through the provision of warehousing and other logistics services.
Toll buys two UK companies, sells stake in metal logistics JV
Toll Group has announced its intention to acquire two freight forwarding companies in the UK and divest its investment in Pacorini Toll - a
joint venture with the Italy-based Pacorini Group.
Toll plans to acquire WT Sea Air Group (WT) and Genesis Forwarding Group (Genesis) - in two deals that, combined, are expected to
generate revenue of more than A$250 million for Toll.
According to Toll's managing director Paul Little, the two UK-headquartered acquisitions will provide significant scale to the Toll Global
Forwarding (TGF) division in Europe.
WT is principally a UK inbound business from Asia specializing in the provision of global forwarding and value added services such as
18th Edition
bonded warehousing, pick-pack, garment re-hanging, vacuum packing and final mile delivery services.
Genesis provides complex and mission-critical international multi-modal freight, predominantly in the Defense, Aerospace and Oil & Gas
industries across Europe, the US, Asia-Pacific and the Middle East.
The Toll Group operates in 55 countries, and, since the BALtrans acquisition in 2007, has continued its global expansion with a string of
acquisitions:
2010:
Qantas' Asia Pacific express airfreight business, DPEX Worldwide
The assets of Concord Park, a privately owned interstate transport company
US freight forwarding company, Summit Logistics
2009:
Japan-based Footwork Express
New Zealand-based freight forwarder, Express Logistics Group
Dubai-based international freight forwarding company, Logistic Distribution Systems
Asia-based express / courier companies Deltec, Kwikmail and Skynet
Asia Pacific based shipping and freight forwarding company, Perkins Shipping
China-based St-Anda Logistics and India-based BIC Logistics
Toll has also concluded the sale of its 50% interest in the Pacorini Toll joint venture to the Pacorini Group of Italy.
Incorporated in 2004, Pacorini Toll provides integrated logistics solutions and trade finance facilitation for the ferrous and non-ferrous
metals industries.
Little said that while the JV has been a successful business since its formation, it is not a core asset for Toll.
Pacorini Toll is now a wholly owned subsidiary of B. Pacorini, and will trade under the name of Pacorini Metals.
Toll acquires Qantas Asia Pacific express air freight business
Qantas has announced the sale of its shareholding in Asia-based freight and courier business DPEX Worldwide to Toll Holdings. The sale
excludes the airline's stake in the DPEX Australian operation.
The transaction is in line with Qantas Group's ongoing strategy of focusing on core business areas, and with Toll's growth strategy for the
Toll Global Express (TGX) division.
"DPEX will support Toll's ongoing growth and development in the region," said Toll Group's managing director Paul Little. "It is an
important addition to TGX's Asia Pacific operations that acquired Deltec, Skynet and Kwikmail businesses in the middle of last year, and will
provide additional scale and coverage across a network of nineteen countries in Asia."
The expansion of the Toll Priority network throughout Asia is a key component of the Toll Global Express strategy. Toll Priority and DPEX
will leverage each other's capabilities and customers to further accelerate growth - both regionally and globally - within this key international
express freight market.
The DPEX acquisition will provide more than A$30 million in revenue for Toll.
Completion of the transaction is subject to approval by China competition authorities as a result of both Qantas and Toll having significant
unrelated existing interests in China.
Toll Group acquires Concord Park
Toll Group has announced its acquisition of the assets of Concord Park, a privately owned interstate transport company.
With revenue of around A$90 million, Concord Park offers distribution, third party logistics, timeslot deliveries into distribution centers,
overnight express deliveries and bulk line-haul services across Australia.
The business combines FTL and LTL services, and, according to Toll Group managing director Paul Little, the company will be a valuable
addition to Toll following its integration into the Toll Express business.
This follows Toll's recent A$80 million acquisition of US freight forwarding company, Summit Logistics International.
In other news, Kmart Australia has entered into an agreement with Toll in2store to manage its new Victorian Distribution Centre.
Fahy returns to the industry with Toll Holding
Air Cargo News understands that Chris Fahy (right), the former chief executive officer of DHL Global Forwarding, has made his longanticipated return to the logistics business by taking up the role as global development director, within the Toll Group.
Fahy controversially left DHL in March 2008, after a management restructuring of the business units, and has since been acting as an advisor
for a number of organizations, including Toll, over the past nine months and contributing to UK parliamentary discussions on retail, automotive
and banks.
In his new role, Air Cargo News has been told Fahy will be responsible for the mergers and acquisitions of the ambitious Toll Group and its
future global footprint.
Toll still on acquisition trail
Zealand and Japan Footwork Express Group in October, and Dubais LDS in December. The company purchased Summit Logistics in the US
this month.
These acquisitions are major steps for the business to achieve its goal of being a top 10 player in the global forwarding market segment,
said Toll.
Overall group revenue was down 6% to $3.3bn and ebit fell 7% to $319m. Group MD Paul Little insisted the companys finances remained
robust.
While volumes are down in some sectors, it is certainly a good time for companies with strong balance sheets to be pursuing acquisitions,
he said.
Volumes appear to be improving, and the company is well placed to take advantage of anticipated more buoyant economic levels.
Toll buys US freight forwarder for $80m
Toll Holdings has acquired US freight forwarder Summit Logistics for about $80 million.
Logistics provider Toll Holdings has acquired US freight forwarder Summit Logistics for about $80 million.
Summit, which provides ocean freight services on the trans-Pacific route between China and North America, generates annual revenue of
around $300 million, Toll said in a statement.
Summit also generates about 30 percent of its revenue from the provision of transport and logistics services to its freight forwarding
customers within the US.
"We have been investigating US-based opportunities for some time, and this is an important acquisition for the group in the global
forwarding market," Toll managing director Paul Little said.
"The development of significant scale in the trans-Pacific trade lane is a key element of delivering price-competitive services to US-based
customers.
"Importantly, integrating Summit into Toll Global Forwarding also improves Toll's total supply chain capability in the US market."
The acquisition of Summit is expected to add to Toll's earnings per share in the first year of ownership by Toll.
Toll shares closed 10 cents lower at $8.48 on Tuesday.
18th Edition
562-908-1699
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1990
Asset Focus:
Market Area:
Founding Business:
International
Ocean Freight
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Robert Wang
Andy Wang
EVP
Ticker Symbol
250
78 **
436
Exchange:
* Financial information may be actual company reported or A&A estimates.
** Net Logistics Revenue is net of pass-through revenues for purchased transportation.
*** Average exchange rates for the respective year are used to convert revenues to USD.
ASSETS
Total Transportation Assets:
Total Tractors:
18
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.4
Total Tankers:
Total Other:
MAJOR MARKETS
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
HON
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Brookstone
Specialty Retailers
Asia, US
Costco Wholesale
Specialty Retailers
Asia, US
Saks
General Merchandisers
Asia, US
Toshiba
Asia, US
Wal-Mart Stores
General Merchandisers
Asia, US
Westinghouse
Asia, US
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Bangladesh
Australia/New Zealand
Belgium
Canada
China
Czech Republic
Mexico
Hong Kong
Denmark
United States
India
France
Topocean
Latin/South America
Germany
Indonesia
Italy
Japan
Netherlands
Korea
Poland
Malaysia
Sweden
Nepal
United Kingdom
Pakistan
Philippines
Singapore
Sri Lanka
Taiwan
Thailand
Vietnam
EDITOR'S COMMENTS
Topocean is a highly respected NVOCC. Chairman and President Robert Wang is one of three partners who
are the core of the business. Wang is Taiwanese/American. About one-third of employees are in the U.S.
Topocean has contracts with 16 container lines and handled 156,000 TEUs in 2009. Besides the Asia-U.S.
lane, Topocean has a significant intra-Asia business. Significant efforts are being made to expand the airfreight
business. Thirty of Topoceans offices are owned. Of these, eleven are in China, five are in the U.S., and eight are
in Indonesia and Malaysia.
Provider's Strengths
Provider's Weaknesses
18th Edition
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1954
Asset Focus:
Market Area:
Founding Business:
Europe
Auto transport
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Cristina Guiral del Pozo
Joseph Pulg
Jose Antonio Alos
General Manager
Vice President
305
Ticker Symbol
305 **
Exchange:
1,500
ASSETS
Total Transportation Assets:
Total Tractors:
400
Total Trucks:
Total Trucks:
90
Total Other:
Total Trailers:
Total Aircraft:
500
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.7
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i2 Technologies
Infor/EXE
i2 Technologies
i2 Technologies
i2
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Audi
Europe
BMW
Europe
Citron
Europe
Daimler
Europe
Ford Motor
Europe
Mazda Motor
Europe
Nissan Motor
Europe
Opel
Europe
Peugeot
Europe
Renault
Europe
Seat
Europe
koda Auto
Europe
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
TRADISA
Latin/South America
Czech Republic
France
Germany
Hungary
Portugal
Spain
United Kingdom
EDITOR'S COMMENTS
TRADISA is a private 3PL. TRADISA handles the distribution of finished cars and supplies parts. In the
European tradition it provides a distribution fleet and runs VAWD. It is dominant in its home country but more
European than many competitors.
Provider's Strengths
Modern, culturally unbiased automotive SCM.
Provider's Weaknesses
18th Edition
91-124-2381611
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1958
Asset Focus:
Market Area:
Founding Business:
International
Cargo Transportation
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
D P Agarwal
Vineet Agarwal
Jasjit Sethi
Executive Director
CEO, TCI Supply Chain Solutions
A K Bansal
Chander Agarwal
CFO
Executive Director
345
325 **
Exchange:
1,177
50
3-5
NSE India
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
210
Total Trucks:
Total Other:
1,196
256
Total Trucks:
758
7.8
Total Trailers:
Total Aircraft:
404
30
14
Total Ocean:
Total Other:
48
46
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Elements
Food, Groceries
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary (Miebach)
18th Edition
Proprietary
Proprietary
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
ISO Certified Certification Locations: TCI Freight, TCI XPS, Shipping Divisions
Other Services:
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Bajaj Auto
India
Bhushan Steel
Metals
India
Food Services
Delhi, India
CEAT Limited
India
Essar Group
Manufacturing
India
GE Betz
Diversified Financials
Pan India
General Motors
India
Hero Honda
Transportation Equipment
India
Hindalco Industries
Metals
Pan India
India
Hyundai Motor
India
ICB India
India
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
China
Germany
Hong Kong
Netherlands
North America
India
Indonesia
Singapore
Thailand
EDITOR'S COMMENTS
Transport Corporation of India provides domestic Indian solutions for warehousing, transportation and thirdparty logistics. It moves approximately 1.5 million consignments (shipments) and 4.5 million tons annually. The
information shown covers TCI SCS and Global divisions.
Provider's Strengths
Indian company with 3PL capabilities, English as business language.
Provider's Weaknesses
Primarily a one country solution.
First quarter profit falls steeply after barely eking out gain in 2008
Net profit for Transport Corp. of India fell 28 percent to $2.4 million in the January-March quarter of fiscal 2008-09 ended March 31.
Revenue totaled $69 million, down from $70 million, the company said in an earnings statement on Friday.
TCI, the countrys leading integrated supply chain and logistics services provider, posted net profit of $7.08 million for fiscal 2008-09, up 1.06
percent from $7 million the previous year.
Income from operations rose to $288 million, from $265 million.
The company earlier announced plans to invest nearly $50 million in trucks and ships over the next two years, and open offices in China,
Thailand and several European countries to accelerate its activities in global markets.
Gurgaon-based TCI currently has a fleet of more than 6,000 trucks and five container vessels for coastal services, operating through a
network of some 1,200 branches.
Transport Corporation to invest Rs 200 crore in 2 years
Transport Corporation of India (TCI) announced that it will invest Rs 200 crore over the next two years, while launching its new corporate
logo and brand line. The company plans to invest Rs 200 crore in the next two years for purchase of ships and trucks and construction of
warehouses, besides opening offices in various countries across globe.
Sigh, then collaborate or die
Collaboration has to be more than just a buzzword if Indian auto sector is to progress, says panel of carmakers.
Perhaps no word is more overused in logistics today than collaboration.
Everyone stresses the need for more collective thinking, transparency between supply chain partners, and an end to the fight for market share
in favor of profitable growth.
In the realm of the Indian automotive industry, the same plaintive cries are heard. The question is, will anyone heed them?
Auto logistics in India is in an interesting position. It is often lauded as the most developed logistics sector in the country, mainly due to the
longevity of domestic car manufacturers, who have introduced supply chain sophistication that other sectors are still striving to attain.
But listen closely to the car manufacturers, which now include a healthy batch of foreign car giants, and youll hear rumblings about the
future. At Automotive Logistics India, a recent conference in Delhi held by Automotive Logistics magazine, many carmakers and auto logistics
service providers said they see future domestic and export demand on a collision course with failing infrastructure. But, perhaps more
importantly, they also see an inherent unwillingness to cooperate logistically as a major hurdle. The initial problem seems to be that, when it
comes to collaboration, carmakers blame logistics companies and vice versa.
Jasjit Singh Sethi, chief executive officer of TCI Supply Chain Solutions, said the auto industry is beset by antiquated notions when it comes
to being efficient in logistics.
If you share trucks or warehouses, its considered bad, he said. And theres no trust. Companies will think, how can anyone know my
business better than me?
A carmaker representative in India had a different take.
Each of the LSPs (in India) do something well but they dont combine to do many things well, said P.B. Madhavan, general manager of
materials planning and logistics for Ford India.
But for all the blaming that goes on, everyone seems to sense the need to improve the situation as the industry moves forward. The
consequences could be huge otherwise.
The dual challenge in the future is capacity, followed by cost, in that order, said Subodh Marathe, head of marketing services at Tata
Motors, one of the worlds biggest vehicle manufacturers. We need collaboration or the growth story of the automotive industry in India will
be hampered.
Marathe clearly stated that (original equipment manufacturers) in India need to stop fighting bloody battles and collaborate on load
balancing.
18th Edition
Empty returns is a challenge everywhere, but especially here in India, he said, a nod to the inefficiency of Indias road network. Theres a
highly competitive stance among OEMs and cooperation versus competition is easier said than done, but were reaching a point where well
have no other choice.
As Marathe rightly points out, the flipside of collaboration is competition, but some here feel that India has such potential for growth that
competition wont even be a factor.
There is actually no competition in the market because the cake is too big to be eaten up, said Sanjay Sinha, CEO of Mahindra Logistics.
So there needs to be collaboration to drive maturity in the 3PL market. And consolidation of suppliers is a step that needs to be taken, within
the clusters in the North, West and South.
So what exactly does this collaboration entail?
The impact of inventory holding has always been important, but its more important now than ever, Marathe said. Theres a lack of
freight consolidation because Indias OEMs still insist on exclusive warehousing and distribution center space.
Marathe did, however, point to what he called new experiments in finished vehicle logistics, including small pilot projects that are looking at
new ways of fitting together rail movement, coastal roll-on/roll-off, road connections and inventory yards.
Theres a case for substantial cost savings by collaborating and sharing findings of such experiments, he said.
He also said multi-franchise auto hubs will likely become a reality because of the seasonal demand for cars (sales spike during festive seasons,
when Indians like to make big purchases) and skyrocketing real estate costs.
With the combined might of all stakeholders, we can be a formidable group, he said. But such a combined effort has not emerged. And
independent efforts are not enough.
Whats driving Marathes concern over a lack of collaboration are the inherent inefficiencies in India today. Employees arent trained to the
same standards as they are overseas, roads are in rotten shape, rail suffers from a lack of capacity. And whats worse, customers are expecting
more than ever.
The auto industry is expected to grow 15 percent annually over the next six to eight years, he said, but road-based logistics will grow only 4
percent. You can imagine what that gap will mean. Logistics investment is not keeping pace with the environment and the reason is, theres
uncertainty in the space. The entire industry is in a state of flux and thats not conducive for long-term investment.
As the automotive logistics providers get stretched, the customer service expectations are rising. Thats a concern for OEMs.
At the most basic level, collaboration in auto logistics is best exemplified by the relationship between a carmaker and its parts vendors.
Different companies have different perspectives on how smooth and transparent these relationships are.
M.M. Singh, executive director of production for Maruti Suzuki India, the countrys passenger car market share leader by a wide margin, said
Maruti is focusing heavily on in-plant logistics. Seventy percent of the automakers suppliers are within 100 kilometers of the companys two
major plants near Delhi. The other 30 percent are in the south and west of India, which are upwards of 1,500 kilometers away.
In-plant logistics are key as volume grows, he said. Its doubled to 675,000 units in the last four years and we have to add another 350,000
through 2011.
Singh said Maruti expects its suppliers to be able to supply materials on a four-hour basis. He said the automaker has a visual online system
that allows suppliers to look and see when inventory levels are low and ship without orders. That, and better planning, has allowed inventory
levels to be reduced from four to five days down to 0.8 days since 2001.
Suppliers may be worried - how can we do four hours on Indian roads? - but it can be done, he said. We have a one-month tentative
plan, then a 15-day schedule, and we tell this to suppliers so they can schedule their own material procurement.
Madhavan said Ford is looking to logistics companies in India to point out the right suppliers, facilities and locations from which to source.
After a certain amount of time, they want vendor and dealer management help, he said of the OEMs expectations of logistics companies.
They want investment in warehousing within the plant and at other locations. They want packaging, which is especially important in a tough
environment like India. And they need to manage the total cost to customers. They need to point out where the rate for a certain vendor might
not be the best, but where its in the long-term interest of the OEM to go with that vendor.
But Madhavan cautioned that it serves carmakers no purpose if logistics companies pretend to be what theyre not.
Logistics companies need to gain competency before offering services and they need to share knowledge, he said.
Robert Strain, logistics director, for global purchasing and supply chain for the Asia Pacific region at GM, agreed.
Suppliers need to be able to say no, Strain said. I have the utmost respect for suppliers who say I cant take on this business at this time.
And the theme of not biting off more than a company can chew was backed up by Sinha, of Mahindra Logistics.
Logistics companies must first meet the basic service requirements before they start fiddling around with value-adds, he said. OEMs
expect 3PL maturity because they have to outsource various activities or they cant be competitive. LSPs wonder who will pay for these
endeavors, but OEMs expect the LSPs to have those capabilities.
Another representative from Tata Motors suggested that suppliers be more closely integrated into new or expanded manufacturing plants to
cut down on transportation costs, but also to make the supplier feel like a larger part of the OEMs business.
Outsourcing can take place inside your plant, said Mohan Savarkar, assistant general manager of logistics for Tata Motors.
For example, a paint shop inside a plant could be operated by an outside company who charges by the car.
The key is shrinking your vendor base so you have tighter integration with each one, he said. We share a monthly plan with vendors, then
a 10-day plan, then a three-day forecast. The vendors can then see when assembly passes key benchmarks (i.e. the body shop) and the predicted
point at which their part is to be fit.
The question is, is there a place for LSPs within this tight integration between OEMs and vendors?
From his perspective, Savarkar has seen integration grow, and as a result has seen efficiency rise.
It used to be that JIT was a desirable when selecting a vendor, he said. Then it was an order winner. Now its a qualifier. If someone
cant guarantee me JIT, then hes not a vendor for me anymore.
Yet Sethi, of TCI Supply Chain Solutions, one of Indias longest-running logistics companies, said Indian carmakers seem to be embracing
3PL activities in the country far more than their foreign counterparts.
The 3PL industry is very fragmented, he said. Only $1 billion out of the $20 billion spent on logistics today is 3PL activities. But we have
found, to our surprise, that Indian (automakers) are far ahead of foreign companies from an outsourcing point of view. Theyre much more
willing to take risks and that may be because foreign LSPs might be too far removed from their home office, who might not be convinced about
India yet.
First to develop should be trust between carmaker and logistics company.
Most contracts are for one year, but you cant forge partnerships in one year, he said. An LSP cant learn when he knows he could be out
the door on commercial terms after one year. On the other side, it makes no sense to share information and processes with an LSP when they
go and help your competitor next year.
But unless you keep a vendor in business, he wont be able to serve you.
When asked how long agreements should last, Sethi replied with a smile that they should be perpetual.
18th Edition
It doesnt actually mean perpetually, he said. You can always throw the guy out. A three-year contract might only last one year, but longterm partnerships dont just benefit suppliers. They benefit OEMs maybe even more.
Theres obviously still work to be done, he said. Carmakers have to not only trust their logistics providers more, but they also need to work
with other carmakers on initiatives that dont jeopardize market share, like combining on assembly processes, or sharing warehousing space or
even space in the same truck.
Take something like a plant location, Sethi said. Many times we put up a plant where there is a tax benefit, not necessarily where it should
be from a market standpoint. You might lose in the short-term but gain in the long-term, and the benefits of being near your suppliers will far
outweigh the tax benefits. These are the things where trust is involved.
If you want to improve on logistics, there will be pain and you have to endure it.
TCI teams up with Concor
Transport Corp of India (TCI) has signed an MoU with train operator, Container Corp of India (CONCOR), to provide comprehensive
railroad-based door-to-door logistics and warehousing services.
The two companies will establish a long-term Joint Working Group (JWG) to devise strategies for serving customers through suitable hub
and spoke arrangements, beginning with certain identified routes.
The collaboration will capitalise on container services provided by CONCORs rail transport and terminal handling network of 58 facilities
throughout the country, and TCIs road transport, shipping and warehousing network.
Both TCI and CONCOR have comprehensive networks of warehouses and distribution centres. TCI Group manages a fleet of almost 6,000
trucks, owns four cargo ships, and has strategic co-operations covering both domestic and international airfreight.
According to TCI executive director Vineet Agarwal, the partnership with CONCOR is part of a long-term strategy to provide allencompassing, integrated supply chain and logistics solutions to a diverse range of customers, not only in the domestic market, but on a global
level.
The Indian logistics sector is on an upswing and has immense potential that is yet to be tapped, said Anil Gupta, CONCORs domestic
business director. This strategic tie-up will open greater avenues for customers with varied requirements by offering them multi-modal
transport solutions.
Transystem Logistics
To contribute to the developing and dynamic Indian market by providing customized logistic solutions for the automotive industry MITSUI
& CO., LTD (Mitsui) and TRANSPORT CORPORATION OF INDIA LTD. (TCI) have joined hands to set up a new joint venture company,
TRANSYSTEM LOGISTICS INTERNATIONAL PVT. LTD. (Transystem)
The Indian automotive industry is going through a radical paradigm shift with the entry of the global majors. No longer does the consumer
have to wait for months for the then sole model available in the market as now new entrants are introducing new models almost monthly. This
has also helped to push the Indian auto ancillary industry. The demands for high quality and low prices have fuelled the requirements for total
quality management and business process re-engineering. All automobile manufacturers are looking for vendors who can help to keep their
inventory costs at the minimum, have assured and damage free deliveries and service their customers in the shortest possible time. Mitsui & TCI
were able to identify the need for a logistics provider who could fulfill these objectives and identified this as a key area of growth.
Mitsuis global and TCIs local expertise would be used to create an operating model that is adaptable to the needs of the Indian auto
industry. Mitsui is recognized for its international skills in handling such operations with their numerous joint ventures throughout the world.
Mitsuis resources and skills in the areas of training of personnel, offering management consultant services and development of operational
systems will give Transystem a solid foundation. TCI on its part will provide the local infrastructure such as land, building and warehousing
facilities from their large network of branches at various locations along with the transportation backbone. It will also provide trained logistics
personnel and the Indian operational systems.
Transystem will be offering complete logistics solutions encompassing planning, transportation, warehousing, distribution and MIS and
related documentation. One of the main objectives of Transystem is to function as a logistic partner for Toyota Kirloskar Motors Pvt. Ltd.
(TKM) by providing them logistics services for their up-coming project at Bidadi, near Bangalore. The following services will be rendered by
Transystem to TKM:
Original Equipment Manufacturer (OEM) Logistics: Procurement, consolidation and transportation of OEMs parts through milk run
operations from various suppliers all over India to Bangalore on a just-in-time basis.
Complete Built up Units (CBU) Logistics: Transportation of the CBUs (finished cars) from plant to all dealers in the country and operation
of CBU yards.
Knock down (KD) Logistics: Coordination and transportation of custom cleared KD parts from port of entry to manufacturing plant.
Spare parts Logistics: Transportation of after market parts to dealers by road and air.
The Joint Venture will develop and provide logistic solutions which conform to international standards and requirements. The knowledge
base and experience of both the companies would be instrumental in making Transystem a success in the Indian market.
TCI Plans to Invest s 100 cr in 2 years
With outsourcing catching on in logistics industry as well, integrated logistics service provider Transport Corporation of India (TCI) has
decided to focus on third party logistics for growth and plans to invest Rs. 100 crore over the next couple of years to upgrade the requisite
infrastructure.
TCI is also eyeing the international markets with plans to form alliances with logistics companies in Malaysia, Philippines, Maldives and
Singapore, Veneet Agarwal, executive director, TCI told to TNN here.
It has recently signed a memorandum of understanding with the Chinese government owned Sinotrans and has entered into tie-ups with
Enem Omni group of Bangladesh and Sea Sky Freight International of Dubai.
At present, international business is a negligible part of our total business but with the WTO regime coming into play by 2005 and free trade
agreements with Thailand and Singapore among others under process international trade is bound to get a major boost, which we want to tap,
Agarwal explained.
On expansion plans, he said the idea was to invest in setting up more warehouses, enhancing the truck fleet and upgrade IT systems
including installing global positioning systems in all owned trucks.
18th Edition
55 19 2108 9001
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1941
Asset Focus:
Market Area:
Founding Business:
Brazil
Cargo Transportation
A, N
TA Express
Wind Express
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Celso Delle Donne Luchiari
CEO
Manager
85
Ticker Symbol
74 **
Exchange:
2,500
ASSETS
Total Transportation Assets:
Total Tractors:
61
Total Trucks:
Total Trucks:
82
Total Other:
Total Trailers:
Total Aircraft:
202
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
31
11
Total Tankers:
Total Other:
MAJOR MARKETS
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Americanas.com
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Industry
Internet Services & Retailing
Location
TM
WM
VA
DCC
Inte IM
Brazil
Asia/Pacific
Europe
North America
Transportadora Americana
Latin/South America
Brazil
EDITOR'S COMMENTS
Transportadora Americana's service area is mainly the southern portion of Brazil.
Provider's Strengths
Regional transportation management.
Provider's Weaknesses
18th Edition
info@ups-scs.com
678-746-6660
COMPANY BACKGROUND
Parent Corporation:
Asset Focus:
Market Area:
Founding Business:
Global
Small Package
A, N
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Bob Stoffel
Alan Gershenhorn
Brad Mitchell
CFO
CIO
7,516
5,357 **
Exchange:
35,000
5-7
NYSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
2,018
Total Trucks:
66
Total Trucks:
Total Trailers:
Total Aircraft:
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
2,507
Total Reefers:
Total Flatbeds:
Total Ocean:
Total Other:
40
570
20
Total Tankers:
Total Other:
77
MAJOR MARKETS
Automotive
Consumer Goods
Retailing
Technological
Food, Groceries
Healthcare
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): i2 Technologies, Roadnet, TMW
Transportation Planning and Optimization:
Warehouse Management System (WMS):
i2 Technologies
Infor/EXE, Manhattan, LMS, Proprietary
Proprietary
Proprietary
LMS
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Pharmaceuticals
N. America
Adidas
Apparel
N. America
Alcatel-Lucent
Global
N. America
Apparel
AND1
N. America
Applied Materials
Global
Baxter Healthcare
Birkenstock
Apparel
Blackhawk
Specialty Retailers
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
North America
Latin/South America
Algeria
Azerbaijan
American Samoa
Albania
Canada
Angola
Bahrain
Bangladesh
Australia
Austria
Mexico
Brunei
Cook Islands
Belgium
United States
Cambodia
Fiji
Bosnia-Herzegovina
China
Guam
Bulgaria
Georgia
New Caledonia
Croatia
New Zealand
Czech Republic
Denmark
Estonia
Samoa
Finland
Tonga
France
Vanuatu
Germany
Argentina
Aruba
Bahamas
Barbados
Belize
Bermuda
Bolivia
Brazil
Cayman Islands
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Guyana
Haiti
Honduras
Jamaica
Netherlands Antilles
Nicaragua
Panama
Paraguay
Peru
Puerto Rico
Trinidad and Tobago
U.S. Virgin Islands
Uruguay
Venezuela
Africa/Middle East
Botswana
Burundi
Cameroon
Cyprus
Egypt
Asia/Pacific
Hong Kong
Ghana
India
Israel
Indonesia
Jordan
Kenya
Japan
Kazakhstan
Kuwait
Australia/New Zealand
UPS SCS
Lesotho
Korea
Greece
Madagascar
Kyrgyzstan
Hungary
Malawi
Mauritius
Lebanon
Iceland
Malaysia
Ireland
Myanmar
Italy
Nepal
Latvia
Morocco
Mozambique
Namibia
Lithuania
Nigeria
Oman
Pakistan
Qatar
Singapore
Reunion Island
Sri Lanka
Saudi Arabia
Senegal
Taiwan
Luxembourg
Philippines
Malta
Moldova
Netherlands
Norway
Tajikistan
Sierra Leone
Poland
South Africa
Thailand
Portugal
Swaziland
Uzbekistan
Romania
Syria
Tanzania
Vietnam
Russia
Slovakia
Tunisia
Slovenia
Spain
Yemen
Sweden
Zambia
Zimbabwe
Switzerland
Turkey
Ukraine
United Kingdom
Yugoslavia
EDITOR'S COMMENTS
UPS is an 800 lb. gorilla of global supply chain services. Revenues for contract logistics were $1.6 billion in
2009. Net freight forwarding/NVOCC/customs brokerage revenues were $3.7 billion. UPS SCS had a profitable
year in 2008. UPS SCS EBITDA margin target is 8%, but we are not holding our breath. In the meantime, UPS
SCS contributes $2 billion+ per year in package business to its big brother. UPS handles about 700,000 TEUs per
year as a freight forwarder. Twelve percent of containers are LCL consolidations; 40% are Asia-U.S. Forwarding
revenues are 60% air and 40% ocean. UPS has 1,400 employees involved in customs brokerage: 400 in Aiken,
SC; 250 in Cleveland, OH; and 750 in Louisville, KY.
UPS has redesigned its supply chain operations to concentrate on high-tech, medical and some retail/consumer
goods customers. These operations are highly integrated between value-added and package delivery services.
Revenues per employee run $175,000 to $180,000.
Provider's Strengths
Leverage of parent company's operations, assets and cash.
Provider's Weaknesses
Overcoming the limiting aspects of parent company culture.
Key Personnel:
Anna Wang, Marketing
Melody Wong, Marketing
Michelle Yu, Manager Contract Logistics
Stella Liu, Supervisor
Lilly Xu, Welcome Center Representative
UPS Express and UPS Supply Chain Solutions (SCS operations) are involved in a closely integrated expansion in China. Operations began in
18th Edition
1988 and UPS now has 5,500 employees. UPS serves in 45 locations that constitute more than 80% of China's GDP (330 cities). There are 16
import and 17 export gateways. There are 144 UPS flights weekly including 12 chartered with Yangtze River Express. (UPS runs the ninth
largest airline in the world in terms of IATAs ranking on scheduled international freight tonne-kilometres flown in 2008).
On the ground, UPS runs 940 vehicles and operates 100 facilities. Operations are concentrated along the Eastern Seaboard. Not
surprisingly, the major airport locations are Beijing, Shanghai, Qingdao, Guangzhou and Shenzhen. The headquarters is in Shanghai where the
International Air Hub is located. Eighty-two flights a week go in and out of Shanghai. The Hub links all of China via Shanghai to UPS
international network with direct service to the Americas, Europe and Asia. A second intra-Asia hub will be opened at Shenzhen handling
transshipment volume for exports from and imports to Asia Pacific and China.
UPS Shanghai hub opened in December 2008. Shenzhen should be operational during the first half of 2010.
UPS has built a strong presence in China in 21 years starting with a Sinotrans joint venture in 1988. Today, it's a wholly owned foreign
enterprise offering global air and ocean transportation, trade management, customs brokerage and duty/tax management, cargo insurance, some
domestic transportation on a contract-basis and logistics management.
UPS' logistics management offerings are similar to its contract logistics offerings in the United States. As in the rest of the world, vertical
industry emphasis is on high-tech, electronics, healthcare and fashion.
Logistics Management Offerings:
Supply Chain Design / Re-engineering
Network / Facility Location Analysis
Inventory Management
Reverse Logistics Solutions
Call Centers
Invoice Audit / Payment Management
VMI / JIT
Finished Goods Inventory Management
Warranty Bonded Warehousing
Post Sales / Service Parts Logistics
UPS has invested about $600 million in China in the period from 2002 to 2008. Thus far, the new Shanghai facility cost is $125 million.
While this is a significant investment, in recent years UPS has had free cash flows over $5 billion. UPS can afford to invest in China building
scope and scale in a manner limited to a few global third-party logistics providers (3PLs).
The Shanghai import and export hub (PVG) is divided into three areas. Express package shipments occupy about half of the space. The
general cargo handling area is for heavy air freight and other supply chain shipments. There is also a dedicated area for other freight forwarders
utilizing UPS airplane space. It is also home to the largest on-site customs inspection area in Shanghai, with Chinese customs officials on duty
round the clock.
The hub also deploys a unique Risk Management system developed by UPS and utilized by Chinese customs, to significantly reduce
unnecessary checks, thereby smoothening cross-border flow.
The facility operates 24/7, 365 days a year. The facility is clean, modern and secure. The middle section where other freight forwarders
tender shipments is fenced off. Guards are on duty at the gates. There are 210 cameras monitoring the Hub's conveyor belts constantly.
Shipments are covered by electronic data interchange (EDI) and Internet information transfers and control. The information process flow
control is in E2K. The product portfolio is:
1. UPS Express Freight with guaranteed, door-to-door 1-3 day service to major metropolitan areas worldwide with standard brokerage
using the standard UPS rate structure with some discounting.
2. UPS Air Freight Direct freight forwarding airport-to-airport 1-3 day service with negotiated shipment rates. Pickup, delivery, and
customs clearance are optional.
3. UPS Consolidated Air Freight which is a 3-5 day version of Option 2.
The UPS flight cutoff time for exports is three hours before departure. Most flights are mixed express parcel and freight forwarding parcel.
Some are exclusively one type of freight. UPS also does some charter flights. Space from commercial airlines is utilized as needed.
UPS has always been a master of standardizing, controlling and improving processes. We looked closely at the export methodology being
used at PVG and found it to be a standard, high quality UPS process. Productivity levels are at the high end of what we have seen for export
operations. Here is a summary of the process:
2 days before shipment Customer Service Rep (CSR) receives shippers notice of intent to ship. All terms (payment, etc.) are verified.
1 day before shipment CSR manages pickup and notice. A record is created in E2K. Cargo is picked up, checked and arrives at PVG
where it goes through the weights and measures check, customs documents are processed, inspections are done and filings are made, customs
cleared.
Shipment day Shipment is loaded and flight leaves. E2K imaging, pre-alerts and shipper notices sent.
Day 1 Verify documents and forward to Finance & Accounting (F&A returns documents to customers after payment is made.)
There are 800 people employed at the Shanghai International Hub. UPS operates 20 buses to pick them up for work. The buses operate to
and from set locations in Shanghai and take employees home after work.
UPS operates 16 air freight hubs throughout the world with the main location being in Louisville, KY. From China, most U.S. locations are
served via Anchorage.
Contract Logistics
UPS has a dozen warehouses in China. These facilities are all modern, high security buildings. The customers are in high-tech, electronics,
healthcare and fashion. The high value products involved with these customers primarily move by air freight.
The Waigaoqiao Free Trade Zone (FTZ) warehouse is a multi-client facility. It has four doors and moves over 2,000 shipments in and out a
18th Edition
month for three high-tech/electronics customers. It is also a Post Sales / Service Parts Logistics area for a major contract manufacturing
operation with 20,000 stock keeping units (SKUs). This facility has a radio frequency (RF) system and everything is bar-coded.
WBW in Baoshan This is a combination bonded and non-bonded facility. The bonded portion of this warehouse is a Service Parts
Logistics area. This facility is 30,000 square feet, racked and RF-enabled. The warehouse management system (WMS) is EXceed which is one
of the few systems used in UPS facilities.
Suzhou Bonded Logistics Center This bonded facility is for high-tech, fashion and equipment customers. It is 32,000 square feet.
Chengdu This is a 9,000 square foot retail product distribution location.
Shenzhen-Yiantian Customs Supervised Warehouse This is a high security, customs-supervised 300,000 square foot facility with 12,000
pallet positions and 60 loading bays. It is used primarily for ocean freight clients.
Futian FTZ Warehouse-Shenzhen This is a 223,000 square foot multi-client warehouse with a wide range of value added services. (This
warehouse was profiled in 2005 when it first opened. See http://www.3plogistics.com/UPS_China_2-2005.htm.)
For the reader looking for additional information on the UPS SCS Louisville hub there is a case study available at
http://www.3plogistics.com/UPS_3-2008.htm.
UPS Revamps Supply Chain Service Offering
Louisville, KY Site Visit
April 8, 2008
and Drug Administration) and DEA (Drug Enforcement Administration) and is compliant to the PDMA (Prescription Drug Marketing Act)
and cGMP (current Good Manufacturing Practice) standards. UPS is also certified as a Verified Accredited Wholesale Distributor. The
Louisville campus features a primary 575,000 sq. ft. building and a portion of an 822,000 sq. ft. building dedicated to healthcare. The facilities
have full backup power generation to ensure temperature is maintained during power disruptions.
These facilities include temperature (20 Celsius) and humidity (50%) controls as well as dedicated cooler space (2-20 Celsius) and a large
freezer room. Processes within the building are established and revised regularly by UPS and its partners. Shipments are made to about 100
countries from this facility. (The UPS Worldport air express hub is two miles away.) The primary Healthcare building has 40 foot ceilings and
narrow aisles with six-high racking. UPS IT visibility and system linkages manage expiration and lot number controls. UPS works with its
clients to provide e-pedigree compliance as markets require.
The examples quoted above show the new UPS contract logistics focus. The solutions being provided require sophisticated global IT
capability, and UPS is a leader in this space. Jeff Jones, vice president of technology services, is one of the best in third-party logistics. Just as
importantly, UPS has gotten much better at applying its famous engineering, design and yield management to this business.
As president of global logistics and distribution David Bowles points out, UPS is the best supply chain solution, not the cheap alternative.
Bowles and his team are dedicated to high class, quality solutions. They are one of the few operations that can provide integrated,
multifunctional, truly global solutions.
Additional Information
As part of our visit to the UPS Louisville campus, we picked up several interesting facts indicative of UPS scale as a global supply chain
manager.
UPS invests $1 billion a year in IT.
UPS processes 4.5 million U.S. Customs brokerage entries per year (2007).
UPS has 81,000 delivery information acquisition devices (DIAD's) in use every day.
Mahwah, NJ has a Tier 4 (highest level of IT) system available. This classification is the first Tier 4 designation ever given.
The Louisville campus includes a foreign trade zone.
UPS has nearly 21 million sq. ft. of focused distribution space globally and another nearly 18 million sq. ft. of forwarding and
consolidation locations.
Square Footage (In Millions) by Location:
U.S. = 10.4
Canada = 3.6
Mexico = .360
EMEA = 3.6
Asia Pacific = 2.9
China/Hong Kong = 1.3
Singapore = .770
India = .043
China and India are strong growth markets for facilities and services.
UPS has engineered its processes and information systems linkage for efficient implementation. A standardized 40-step process is being
patented. UPS effectively uses applications to different warehouse management systems (WMS) based on industry sector applications linked to
its own SPLUS platform for service parts distribution and returns.
UPS has approximately 900 3PL contracts.
UPS has 24,000 employees in Kentucky and is that states largest private employer. The Louisville supply chain campus has
approximately 4,000 employees. The multi-client campus allows flexibility to shift workers on short notice to manage peaks and valleys of
work. This facilitates seasonal or day-specific fulfillment requirements, customer promotions or highly competitive speed-to-market activities
for a new product launch such as a generic drug just receiving FDA approval.
The 11 P.M. - 4 A.M. UPS Worldport air express sort hires hundreds of college students under a special Louisville Metro College
program. UPS pays their tuition and other college expenses. Part-time hub workers are also eligible for medical benefits.
UPS SCS now feeds $2 billion a year to UPS small package.
86% of world healthcare spend is in North America, Japan and Europe.
Mark Hone, global distribution and transportation manager for Abbott Diabetes Care said that the UPS operations for Abbott run,
Smooth as silk." He indicated that Abbotts merger with TheraSence drove formation of the partnership.
Bill Gardner of Nikon said that the coming of the new technology of digital cameras drove Nikons outsourcing to UPS. Using Louisville
as a central DC from assorted inbound international air freight movements from Nikon manufacturing, UPS does extensive kitting for Nikon
and handles its significant order variations corresponding to unique retailer promotions.
High-Tech customers generate about ten times more air freight revenue than ocean freight revenue.
UPS recently tripled the number of express air freight lanes to realign its international network of UPS Airlines "browntails" and
purchased space as a forwarder on commercial carriers. UPS manages over 1 billion kilos of air freight annually.
Fortune 500 customers initially spread UPS globally, but growing medium-sized customers fill out distribution capacity and increasing
multi-modal transportation strategies for air and ocean freight services as well as global small package express and less-than-truckload
transportation.
The UPS business model and IT are robust and highly reputable.
Final Comment
UPS SCS looks like it is really getting its act together. It should remain profitable going forward. Net revenues are $5.9 billion ($1.6 billion
in contract logistics and $4.3 billion in NVOCC/freight forwarding/customs brokerage). There is a lot of talent and innovation developing and
executing UPS supply chain strategies; some of it by guys who never drove a brown truck.
UPS Supply Chain Solutions (SCS) [To view in full html format, follow this link: http://www.3plogistics.com/UPS_China_2-2005.htm]
South China Operations Site Visit
18th Edition
February, 2005
Key Personnel:
W.K. Wong, Terminal Manager
Ivan Li, Director Business Development Support & Marketing
Celine Lee, Business Development
The most striking feature about UPS South China operations is not their individual largeness nor their modern, uniform supply
chain/logistics methods. The thing that got my attention was how much UPS presence is already there. UPS, a true global power, is making a
large footprint in South China. And its only one of the footprints of UPS, the brown giant, as it routinely expands on its original steps in Asia.
For most 3PLs, duplicating what UPS has put in place in a few years would be a huge undertaking. For UPS, it is a fairly standard solution
among many in globalization. A well run company with over $36 billion in revenue and more than $2 billion a year in free cash flow can do
things like that. I could feel it when I visited the new Futian FTZwarehouse. (Futian is across the border from Hong Kong about one hour
away.)
Construction on this facility is completing. It is 240,000 square feet on six floors. The first five have 6,000 pallet positions per floor. The
office is on top. The facility handles both inbound and outbound. Customers include the high-tech company Molex, Toshiba, Gortex,
LexMark and others. The facility uses barcodes, cycle counts, A&B designations and UPS global WMS. Exceed.
In addition to Futian, UPS SCS has a 300,000 square foot warehouse in Yantian for its export container operations.
It handles about 4,000 FEUs per month with seasonal fluctuations. The maximum throughput of the facility is about 8,000 FEUs per month.
Most operations involve LCL consolidation and pick & pack. There are 16 forklifts, 12 checkers and about 50 laborers (W.K.). This is a
customs supervised export license operation whose peak season is June October.
The Hong Kong warehouse is a mere 150,000 square feet housed in the ATL Logistics center. The ATL center is 13 floors high and said to
be the worlds largest concrete building with 5 kilometers of roadway inside it. ATL is home to most of the major Hong Kong 3PLs. UPS SCS
Hong Kong operation handles ocean freight about 3,000 FEUs per month. The maximum throughput is about 9,000 FEUs per month.
UPS SCS major competitor in this area, as in most of the Far East, is DHL/Danzas. While there is still room for other players, they will
need to be nimble and creative to avoid being stepped on by these giants.
If you are a potential UPS SCS customer for the Hong Kong region, you will find the sales people educated, articulate, with good English
and quite able to craft solutions. But if you want a real feel for what you are going to get, talk to W.K. Wong. He is a good operator who
understands the business and is serious about getting it done right. He is a lot like warehouse managers Ive meet in Chicago, Dallas or The
Netherlands.
UPS Supply Chain Solutions Turns Into a Winner [To view in full html format, follow this link:
http://www.3plogistics.com/UPS%20SCS_12-2003.htm]
Atlanta, GA - Site Visit
December 9, 2003
Interviewees:
Bob Stoffel, President
Lynnette McIntire, Director Public Relations
UPS Supply Chain Solutions has turned the corner. It is very large, profitable and now a vital part of the UPS steamroller.
UPS SCS is now the largest U.S.-based 3PL. Morgan Stanleys Jim Valentine estimates that FY 2003 net revenues were $2.16 billion. In
addition, UPS SCS was profitable in every quarter of FY 2003.
While we (Armstrong) estimate growth for FY 2003 was about 6.8%, President Bob Stoffel anticipates that it could exceed 10% for FY
2004. Stoffel is a UPS veteran with a strong operations bent. Hes the right guy at the right time for UPS SCS and its 22,300 employees. He is
also a realist who understands that his relatively new distribution and logistics business unit may not generate the kind of operating ratio that UPS
mature package business can. Armstrong & Associates expects that UPS SCS should be able to generate EBITS of 8-10% within a few years.
These EBITS will run 4-5% less than the transportation operations.
We maintain a detailed profile of UPS SCS in our Whos Who In Logistics, and the reader is invited to look there for a list of customers,
rolling stock assets and other facts. For the time being, here are the other salient features from our visit in Atlanta and additional, recent
research.
UPS SCS revenues are split fairly evenly between international and domestic. About 90% of customers have integrated services.
i2 applications are the principle transportation design and execution tools. Manhattans Pkms is the in-house warehouse management system.
However, SCS and its analysts use a large variety of other software programs including customer legacy systems as well as its own proprietary
software. UPS-owned Roadnet and Mobilecast software (routing, scheduling and dispatching) are sold independently by UPS Logistics
Technologies.
UPS is using activity-based costing to better understand pricing and margin variations by geography and vertical industry.
Expect UPS to win its struggle with the FMC over tariff filing requirements for NVOCCs. UPS has strong lobbying capabilities and we believe
it will get this change from congress if the FMC denies it. For its freight forwarding operations, it may become advantageous for UPS to charter
its own container ships.
Armstrong & Associates has concluded that European operations are profitable and cross selling of product lines is going well.
Good customers are often mid-market companies who let UPS manage their whole supply chains. Customer density over facilities is
improving. UPS SCS Louisville campus (2 million square feet) and its Elizabethtown facility are close to full capacity. The company also is
completing a 400,000 square feet facility in Chicago next month.
UPS SCS is responding to a few hundred requests for proposals per month. There are 12 people working on contracts and 80 supply chain
management engineers.
18th Edition
UPS SCS has a good recognition of competition and market opportunities by geography and product line.
Supply chains are very different by verticals and each creates its own opportunities. UPS knows how to play in each vertical and has hired
industry specialists for each.
If that list doesnt impress the reader, it is important to remember that UPS Capital, consulting, mail innovations and the rest of the nonpackage division have related activities that are very beneficial to UPS SCS. These other non-package units do more than $786 million per year
in revenue. More importantly, UPS now has $4 billion in cash that it needs to invest.
You can understand why we think Stoffel is the right guy, in the right place, at the right time.
Parcel redux: FedEx follows UPS with bullish forecast
Memphis-based package giant raises quarterly projections, citing continuing strong demand. Analysts warn of rate hikes ahead for shippers.
These are good times for the dynamic duopoly of the U.S. small-parcel industry.
Four days after UPS Inc. reported stellar second-quarter results, FedEx Corp., UPS's chief rival, announced on July 26 that per-share earnings
for its fiscal first quarter, which ends Aug. 31, would be well above what it originally forecast and would come in between 81 percent and 116
percent ahead of the year-earlier period.
The Memphis-based giant said it expects earnings to be $1.05 to $1.25 a share in the quarter; its earlier forecast was for earnings to reach 85
cents to $1.05 per share. For its full fiscal year, FedEx expects earnings per share of $4.60 to $5.20, up from a range of $4.40 to $5.00. FedEx
reported earnings of $3.76 per share in its previous fiscal year.
"Our revenue and earnings growth are exceeding original expectations, primarily due to better-than-expected growth" in the company's air
express and ground parcel volumes, said Alan B. Graf Jr., FedEx's executive vice president and chief financial officer, in a statement.
Graf said the company is benefiting from demand for its international express and freight services. For example, FedEx's International
Priority service, a time-sensitive premium-priced product, grew 20 percent in the quarter, Graf said. FedEx will issue its official first-quarter
results on Sept. 16.
The FedEx announcement comes on the heels of UPS's report that its per-share earnings in the second quarter rose 71 percent over prioryear numbers. Second-quarter revenue for the Atlanta-based company rose 13 percent year over year to $12.2 billion, resulting in a 57-percent
increase in operating profit to $1.4 billion. Operating margins year over year rose by well over 30 percent, the company said.
Jon A. Langenfeld, transportation analyst for the Milwaukee investment firm Robert W. Baird & Co., said the performance of both
companies, along with positive comments from other transportation firms, supports the idea that freight demand will stay strong beyond the
upcoming 2010 peak shipping season.
In an unwelcome but expected development for shippers, carrier pricing has lagged behind the recovery, according to Langenfeld. This
implies that higher prices lie ahead for shippers as they negotiate contract renewals in the second half of 2010.
FedEx and UPS continue to enjoy favorable pricing as a result of DHL Express's January 2009 exit from the domestic U.S. market. While the
incumbents have long since absorbed DHL's daily U.S. package count of between 1 and 1.5 million, the absence of a third shipping optionand
the departure of the low-price leaderhas led to yield improvements for FedEx and UPS and has emboldened them to take tougher lines on
pricing, according to Jerry Hempstead, former vice president, national account sales, for DHL Express and its predecessor Airborne Express,
and now head of a consultancy that bears his name.
An improving economy has also been a tailwind for the carriers. DHL, which continues to offer international service to and from the United
States, has said it is shooting for a 10- to 15-percent growth rate for those volumes by early 2011.
According to Hempstead, UPS and FedEx have been using such code phrases as "rational pricing" and "intelligent discounting" to describe
their rate strategies in the current market environment. Whereas 18 months ago, the companies would have tried to retain accounts at almost any
cost, today they are increasingly walking away from business they believe offers slim profit margins, Hempstead said.
The analyst believes that with the economy growing, and with the U.S. Postal Service proposing significant rate increases on its parcel
business, UPS and FedEx will feel confident coming to market in early 2011 with substantial price hikes of their own.
"This is not great news for shippers," Hempstead said.
Shots fired in UPS dispute in Turkey
18th Edition
WHY THEY WON: Readers who voted for UPS Supply Chain Solutions cited the Atlanta-based 3PL's "superior customer service and
excellence in execution" and quality product and consistent performance, praising it as a one-stop services provider and top value for the
money.
Brad Reagan, chief operating officer for water sports accessory company Monster Tower, appreciates UPSs dependability and rapid
response. Its reassuring to know that UPS can move inventory quickly when it's necessary, which is critical to a successful business
relationship," says Reagan.
Brad Mitchell, UPS vice president, logistics and distribution, credits the 3PL's loyal following to its range of service offerings. UPS has
strategically become one of only a handful of companies in the world capable of managing all the critical touchpoints of the supply chain process
under one brand, says Mitchell. We provide both asset and non-asset based transportation-from small package delivery to air and ocean freight
movement on global trade lanes, all of which are supported by visibility tools to manage suppliers, inventory, fulfillment, trade compliance and
reverse logistics.
CASE STUDY: March Networks
March Networks, a provider of intelligent IP video solutions, sought to partner with a global logistics provider that could offer end-to-end
supply chain visibility, consistent processes, and accountability for its distribution activities.
To support its customers worldwide, March Networks deploys an advance replacement model to exchange defective units in the field; it is
supported by a 48-hour time-in-transit requirement.
UPS' proven track record in reverse logistics and the company's ability to service 99.9 percent of March Networks' installed base within 48
hours led March Networks to partner with the3PL in early 2009.
18th Edition
562-552-9401
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1995
Asset Focus:
Market Area:
Founding Business:
Global
Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Eric W. Kirchner
CEO
Jochen Freese
William T. Gates
3,568
1,361 **
Exchange:
19,514
>100
3-5
NASDAQ
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
40
Total Trucks:
22
Total Trucks:
Total Trailers:
Total Aircraft:
Total Other:
Dedicated Contract Carriage Trailers:
Total Dry Van:
409
1,873
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
24.3
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary--eMpower, i2 Technologies
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary--eMpower, i2 Technologies
Proprietary--eMpower, Infor/EXE
Proprietary--eMpower
Proprietary--eMpower
Proprietary--eMpower
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EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
3M
Miscellaneous
Abbott Laboratories
Pharmaceuticals
Adidas
Apparel
Ashanti Goldfields
BASF
Chemicals
Bayer
Chemicals
BMW
Boehringer Ingelheim
Pharmaceuticals
South Africa
Bombardier
N. America
Beverages
Bristol-Myers Squibb
Pharmaceuticals
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
South Africa
South Africa
US
Europe
North America
Latin/South America
Afghanistan
Australia
Armenia
Canada
Angola
Bahrain
Azerbaijan
Fiji
Austria
Mexico
Bangladesh
Guam
Belarus
United States
Brunei
New Zealand
Belgium
Cambodia
Saipan
Boznia-Herzegovina
Argentina
Aruba
Bahamas
Barbados
Bermuda
Bolivia
Brazil
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guadeloupe
Guatemala
Haiti
Honduras
Jamaica
Netherlands Antilles
Nicaragua
Panama
Paraguay
Peru
St. Croix
St. Lucia
St. Thomas
Trinidad
Uruguay
Venezuela
Botswana
Burkina Faso
Burundi
Cyprus
Djibouti
China
Egypt
India
Ethiopia
Indonesia
Ghana
Guinea
Japan
Australia/New Zealand
UTi Worldwide
Algeria
Africa/Middle East
Asia/Pacific
Bulgaria
Croatia
Georgia
Czech Republic
Denmark
Estonia
Finland
Kazakhstan
France
Jordan
Laos
Germany
Kenya
Macau
Greece
Kuwait
Lebanon
Malaysia
Guernsey
Myanmar
Hungary
Nepal
Iceland
Pakistan
Ireland
Israel
Libya
Madagascar
Malawi
Mali
Mauritius
Philippines
Morocco
South Korea
Mozambique
Sri Lanka
Namibia
Nigeria
Taiwan
Singapore
Latvia
Lithuania
Luxembourg
Macedonia
Malta
Thailand
Oman
Italy
Moldova
Qatar
Uzbekistan
Netherlands
Saudi Arabia
Vietnam
Norway
Senegal
South Africa
Poland
Portugal
Tanzania
Romania
Tunisia
Russia
Uganda
Slovakia
Slovenia
Zambia
Spain
Zimbabwe
Sweden
Switzerland
Turkey
Ukraine
United Kingdom
EDITOR'S COMMENTS
UTi's net revenues decreased 12% last year. UTIs contract logistics operations are 39% of net revenues. UTis
purchase of Standard Corporation is still the most successful contract logistics acquisition we have seen. UTi
contract logistics has strong operations in Asia and a major drug distribution operation in South Africa. Airfreight
forwarding, ocean freight forwarding and customs are the other major functions. UTi does very well in British
Commonwealth countries.
Provider's Strengths
Asia, Africa and Europe. Airfreight and contract logistics are strong offerings.
Provider's Weaknesses
UTi Pharma dominates the private sector pharmaceutical market in South Africa controlling over 50% of the total prescription
pharmaceutical business. As a third-party logistics provider (3PL), Uti does direct distribution connecting major pharmaceutical companies to
pharmacies, doctors and other end users. Under its core model, drug wholesale/distribution companies are eliminated. Uti receives the
prescription drugs from 31 clients including eight of the top 10 pharmaceutical manufacturers. Uti then takes orders through its call center and
website. Uti handles the orders, manages the inventory, delivers the drugs, collects the money and pays the pharmaceutical manufacturers.
The major alternative to Utis "Direct Distribution" model is the pharmaceutical wholesale distributor who buys pharmaceuticals from drug
companies and then resells them to pharmacies and hospitals. In the U.S., wholesale/distribution middlemen dominate the pharmaceutical
supply chains except for instances where larger retail chains like Walgreens and CVS buy direct. The major pharmaceutical wholesale
distributors are Cardinal Health, McKesson and AmerisourceBergen.
The wholesale distributor model is still present in South Africa but most of its activity is now part of vertically integrated companies who
own pharmacy chains and supply chain functions. Vertical integration helps companies stay competitive with direct distribution operations
which save 10% to 12% of supply chain costs when compared to wholesale distributors. Direct distribution cuts out the buy and resell step
which is basic to the wholesale distributor model.
The money saving "Direct Distribution" model got started in South Africa in 1994. Backed by four committed CEO's from the
pharmaceutical manufacturers, Utis CEO Holger Eckoldt led efforts to get Direct Distribution working. South Africa held its first democratic,
post apartheid elections in 1994. At the same time, drug wholesale distributors refused to accept changes brought by the new order. A boycott
was led by UPD which is now owned by the parent of the major pharmacy chain Clicks Pharmacy. UPD and other drug wholesalers bought up
the supply of most prescription drugs and withheld them from the South African public for the first half of 1994. After six months, a
combination of major pharmaceutical companies broke the logjam by supplying drugs to the public through direct distribution.
In 1996, South Africa adopted a Health Policy. In 1997, the Medicines Control Act was revised and in 2004, price regulation was
established. Prescription drugs are now sold at single exit (fixed) prices which are modified yearly. Under consideration is setting the logistics
fees associated with pharmaceuticals distribution.
Fifteen years after the new democracy was formed, South Africa has two pharmaceutical sectors. The governmental healthcare (public)
sector covers 85% of South Africans (40.5 million people) at a pharmaceutical cost of $470 million. The private sector covers 15% of the
population (7.4 million people) at a pharmaceutical cost of $2.83 billion. Over-the-counter, generics off patent and original branded products
add $2.8 billion. About 15% to 20% of the public sector drugs go missing from governmental warehousing and transportation vehicles.
Uti Pharmas clients (pharma manufacturers) sales are over $2 billion of this total. Annually, 1.8 million invoices are cut by Uti and 2.8
million parcels are delivered. Retail level customers (doctors, hospitals, etc.) exceed 5,000. Utis top 10 customers account for about 50% of
revenues, which will be $90 million in 2010.
Uti Pharma Infrastructure
Uti Pharma has 1,000 employees. Holger Eckoldt, CEO, has a core group of managers but he is the master of creation and execution for
this company. Eckoldt, 63 years old, was raised in Germany but lived and worked for years in Canada, Brazil and Singapore. Sales, marketing
and financial management are exceptional in this operation. Operations and execution are very good for South Africa. Eckoldt transitioned his
core team from IHD when Uti purchased it in 2004 and renamed it in 2008.
For Uti Pharma, Johannesburg is the corporate control center with three major locations and 412,000 sq. ft. (38,280 m) of space. There are
important regional distribution centers in Cape Town, Durban and Port Elizabeth. All locations are ISO 9000 Certified and governmentally
licensed. Deliveries throughout South Africa are handled daily by 80 one-ton trucks supplied by five contractors. Special carriers are used for
certain no-go areas. All delivery trucks are GPS monitored. Blind tracking units are hidden on each truck and assistants are sent with drivers
as necessary. Thirty deliveries are average for vehicles in metro areas. Not surprisingly, productivity in delivery and warehousing operations is
affected by the top operational priority-security. In addition to its South African business, Uti Pharma exports to eight surrounding countries.
Utis Linbro Distribution Center
Linbro is the primary facility for most Uti Pharma functions. It has 22,400 m (241,000 sq. ft.) of space. Linbro uses 1.2 x 1 meter pallets
(48" x 40" in the U.S.). Product is picked according to FEFO (first expired first out). Batches of product are separated by pallet locations.
Facilities are camera controlled and entrance to the warehouse, and controlled locations within it, is by finger print identification devices. No
cell phones are allowed.
The warehouse management system (WMS) "Delta" was built by IHD (Uti Pharmas predecessor). It is designed to cover all of the operating
idiosyncrasies of the multi-faceted Uti warehouses.
Individual item fine picking is done by using voice picking technology which replaced pick to light systems at Linbro. Staff members are
paid extra for picking accuracy.
Picked items are collected in blue plastic containers/trays. The containers traverse the seven loop conveyor systems to key locations until
orders are filled. Containers are bar coded and auto reading routes them through the system.
Completed containers are forwarded to security checking, packed and labeled for distribution.
Linbro was operating at capacity at the time of our visit.
Utis Longmeadow Warehouse
Uti Pharma increased its capacity by opening the Longmeadow warehouse in September 2006. This 18,640 m (201,000 sq. ft.) facility is
primarily a case/pallet pick warehouse for FMCG (fast moving consumer goods). Fifteen hundred different FMCG products are stored using A
, B, C locations. Cold chain pharmaceuticals and diagnostic apparatuses are also handled at this location. There are 14 receiving doors
with two dedicated to cold chain receiving. The cold storage area including receiving is 2,100 m. Most cold products are stored in half pallet
locations.
Cold chain products are elevated using Hanel Lean lifts to the mezzanine level (4,000 m) where they are stored and picked. Frozen products
are shipped throughout South Africa in 17 liter and 400 liter containers packaged with dry ice.
The mezzanine level at Longmeadow is used for cold chain and fine (individual items) picking. Non-cold fine picking at this location is mostly
for non-prescription FMCG.
It is fairly standard in South Africa to allow orders with single items even for non-pharmaceuticals. This leads to a host of mixed orders on
pallets of cartons plus single items. In part, this happens because of a large amount of small customers. (There are still a host of small
pharmacies but about half of them have gone out of business as the market matures and retail chains displace the mom and pops.)
As in Linbro, pharmaceuticals received are placed in quarantine, checked by on-staff pharmacists and then moved into the warehouse and
18th Edition
Both our facilities in Ghana and Kenya are being expanded to accommodate more products as we seek to convert them from merely
supporting the donor funded project to taking on a commercial function along exactly the same lines witnessed in Centurion warehouse
during the tour.
DHL Supply Chain - Healthcare Focus
DSC Healthcare operates a 6,500m warehouse in the Elandsfontein suburb of Johannesburg. There are 4,700 rack positions and 200 m of
2 to 8C chilled space. The warehouse is fully air-conditioned. Like most South African warehouses we visited, this one has a stand by
generator for electrical power. Based at the warehouse, are 14 one-ton light delivery vehicles. The operation uses a network of cross-dock third
parties on the coastal regions. The facility houses various dedicated healthcare clients in separate parts of the warehouse that share some
overhead costs and synergy on transport.
The operation is headed up by Alan Burgess, who is a no-nonsense operations man, who drives rigor into processes and very tight stock
control.
The Netcare Hospital Group was signed by DHL in 2006 and is the main focus of this healthcare operation. Netcare has 105 hospitals and
clinics in South Africa. In 2007, DHL signed Bausch & Lomb and took over its South African contact lens and solutions business. This is an
intricate challenge, considering the small size of each delivery and the extensive number of Optoms and eye clinics that require drops throughout
the Republic of South Africa. In 2008, DHL added the Nativa business to its healthcare operations. In 2009, Burgess signed BARD SA, a
medical devices company.
DSC Healthcare moved away from the Pharma-Direct model of fine distribution (unit picking and providing multiple deliveries per day in
a shared client operation). The previous DSC Healthcare business was Kinesis Logistics and was formed by various multinationals including
Pfizer (and then Warner Lambert), GlaxoSmithKline and Aspen Pharmacare in 2000.
DSC Healthcare has all the necessary licenses including the MCC (Medical Control Council), Department of Health and Pharmacy Council.
There are three registered pharmacists on hand.
Burgess plans on leveraging off the BARD SA account to gain more medical devices business and expand hospital logistics capabilities. The
DSC Healthcare operation is capable of a wide range of services and this flexibility is proving to be very valuable to its clients.
New UPD
New UPD is the underlying wholesale distribution arm for the Click Group. There are over 200 Clicks Pharmacy's plus other, sister retail
shops in South Africa. Clicks opened its first pharmacy in 2004 when regulatory reform allowed for corporate ownership of retail pharmacies.
UPD has five DCs including the Lea Glen Pharma DC which cost it R45 million and has automated picking. The DC is 20,250 m 4,000 m
are used for pharma and 16,250 m are used for FMCG. There are 13,752 stock keeping units (SKUs) and 360 employees. A total of 2,000
customers place 95,000 orders a month.
UPD is primarily part of a vertically integrated operation whose mission is to operate profitable drug stores. However, it does have a 3PL,
UPD Specialized Distribution, and a dedicated distribution division for once and twice a day deliveries depending on the location within South
Africa.
UPD was founded in 1993. In 1999, it was acquired by a consortium and renamed New UPD. New Clicks acquired UPD in 2003. UPD
provides exclusive distribution for hospital chains LifeHealth Care and Mediclinic.
As mentioned previously, UPD was the main culprit in the famous drug boycott of 1993-1994. UPD had 60% of the drug wholesale market
at the time. UPD and other wholesalers bought up and held all of the prescription drugs coming into the country. The boycott lasted for a half
year and helped create big pharmas need for the direct to customer approach used by UTi and PHD.
Source: www.adcock.com
South Africa has huge security issues and its share of sophisticated, organized crime.
Concentrek Thrives after UTI Acquisition
2009.htm]
Grand Rapids, MI USA - Site Visit
April 29, 2009
Key Personnel:
John Patterson, President and CEO
Greg Morello, EVP Business Development
Mike McClelland, Chief Operating Officer
Walt Zelichowski, VP Client Services
Julie Cooper, Director of Operations
Eugene Williams, Director of Operations
UTi Worldwide and Concentrek Overview
UTi Worldwide has developed into a Tier-One global supply chain manager building an operation of over 20,000 employees working in 88
countries. UTis supply chain operating network includes 390 branch offices, 200 logistics centers, and 130 exclusive independent agent offices.
Its revenues have increased from $164 million in 1993 to $4.5 billion in fiscal 2009. Asia Pacific business accounts for 24% of UTis revenues,
the Americas and Europe generate 32% and 30% respectively, and Africa accounts for the remaining 14%. After subtracting out purchased
transportation, 47% of UTis net revenues come from value-added warehousing and distribution, 22% from airfreight forwarding, 13% from
ocean freight forwarding, customs brokerage is 7%, and other services account for 11%. As part of its global business strategy, UTi extended its
North American domestic transportation management capabilities by acquiring Concentrek in 2005.
Concentrek was founded by its current President and CEO John Patterson and two other third-party logistics (3PL) veterans as the 3PL
operation of truckload carrier Knight Transportation in 1999. Concentreks transportation management operations are run by a North American
staff of 150 people processing over 675,000 shipments annually. Its major customers include: Ansell, Bell Canada, BRP, Bombardier
Transportation, Cummins, Rain Bird and Rotary Lift. Concentreks core service offering includes: supply chain network modeling,
transportation management process reengineering, inbound and outbound transportation planning and management, carrier procurement, rate
18th Edition
and contract administration, freight bill audit and payment, and claims administration.
Concentrek Leverages i2 Technologies Solutions
To support operations, Concentrek has been a heavy user of i2 Technologies transportation management and planning systems since 2001. It
upgraded to version 6.2.3 of i2s transportation management systems (TMS) in March 2008. Concentrek primarily uses i2 to optimize and
manage customers transportation on a daily basis. The system has 120 active users and processes approximately 13,000 shipments each week.
While the shipment counts are high, the data management requirements are even higher. Approximately 58,000 shipping locations, 205,000
consignee locations, 900 carriers, and 7.3 million lanes are configured and maintained in the TMS.
The following customer case study highlights how Concentrek reengineers and manages customers transportation and how it has benefited
from being part of the UTi organization.
Bell Canada Customer Case Study
Bell Canada required a 3PL who could manage high-volume, time critical distribution of over 450,000 small package shipments per year from
its Unigistix/UTi warehouse in Brampton, Ontario. (A&A reviewed this operation in 2007; for our report please see:
http://www.3plogistics.com/UTi_Canada_11-2007.htm.) After a formal RFP process, Bell Canada selected Concentrek for outbound
transportation management in 2007. The distribution operation had a $9.1 million annual transportation spend and a goal to reduce its net
transportation cost by $1.65 million in one year.
Concentrek deployed its network engineering team on the project and developed a redesigned transportation management solution in July
2007. During the startup Concentrek had to deal with many challenges. Concentrek was able to begin implementing the solution in August and
the operation went live on August 27. Concentrek recruited onsite staff familiar with Bell and its freight, and Bell supplied key personnel to
support the success of the implementation. While using less-than-truckload (LTL) carriers was not necessary for mobile phone products, Bells
satellite television receiver product was mode shifted from small package to LTL and truckload. Through better carrier selection and mode
conversion, Concentrek was able to generate net first-year savings exceeding Bells goal. In addition, carrier on-time delivery service was tracked
from Day 1 and has shown significant improvement.
Its ability to reduce costs allowed Concentrek to secure Bell Canadas remaining transportation management business in October 2008. This
new business totaled $25 million in annual freight spend and included rationalizing Bells dedicated fleet operationsvan, flatbed, and mail
serving 63 routes delivering further savings to Bell.
Today, Concentrek has a staff of six onsite at the Brampton warehouse performing daily transportation optimization and management
services for Bells entire Canadian transportation network. Concentrek is also providing freight audit and payment services which have
significantly improved Bells data collection and reporting capabilities.
Summary
Concentrek is a growing part of the UTi organization and as the Bell Canada case study illustrates, it has done a good job of supporting
existing UTi accounts in delivering integrated supply chain solutions. We anticipate that as UTi expands into providing more and more end-toend supply chain management solutions for customers, Concentrek will be increasingly relied upon to manage complex networks in a 3PL and
lead logistics provider role.
UTi Worldwide Builds upon Two Key Acquisitions [To view in full html format, follow this link:
http://www.3plogistics.com/UTi_Canada_11-2007.htm]
Ontario, Canada - Site Visits
November, 2007
Key Personnel:
Tim Speed, President - UTi Canada, Inc.
Binny Jind, President & CEO - SPAN International
Patricia Croley, VP & Director of Quality - SPAN International
Tom Krzepkowski, VP & Director of Supply Chain Operations - SPAN International
Shawn Ragoobar, General Manager - USA Supply Chain Operations - SPAN International
Greg Stamkos, SVP & COO - Unigistix
John Brereton, CFO & CIO - Unigistix
UTi Worldwide is a major global third-party logistics provider (3PL) with revenues of $3.6 Billion and staffing of over 19,000. In 2004 and
2006 it made "tuck-in" acquisitions of two very interesting mid-sized Canadian logistics providers: Unigistix, Inc. and the SPAN International
group of companies.
Unigistix, a value-add warehousing 3PL, has approximately 350 employees and three warehouses in Canada totaling over 800,000 square feet.
It has developed a solid base of telecommunications customers including Bell Canada, Virgin Mobile, Globalstar, and TELUS. Key value-added
services offered include handset programming, kitting, packaging, labeling, inventory management, order fulfillment, refurbishment and repair,
and asset recovery.
SPAN International was founded in 1981 by its current President and CEO Binny Jind. SPAN began operations as a contract manufacturer
for automotive industry customers. Leveraging its manufacturing materials management and parts kitting and sequencing skills, SPAN has built
significant value-added 3PL capabilities and now runs an inbound materials management and just-in-time (JIT) parts distribution network
supplying many manufacturing lines of North American automotive manufacturers.
Unigistix First Gulf Warehouse
The 302,000 square foot Unigistix First Gulf warehouse is a bonded multi-client facility serving 19 customers including: Este Lauder and
TELUS (Canada's second largest wireless phone company).
UTi's Toronto freight forwarding operation has recently been collocated in approximately 100,000 square feet of the warehouse for increased
operational synergies. It manages air shipments of leather seats from Toronto to DaimlerChrysler in South Africa, Psion Teklogix barcode
scanners to Europe, and generic pharmaceuticals being distributed in the U.S. In addition, UTi is a global lead logistics provider (LLP) for Este
Lauder and is managing imports of approximately four to five ocean and air containers per day of inbound materials and a small amount of
18th Edition
Summary
By going north of the border, UTi Worldwide has made two significant acquisitions to help round out its North American contract logistics
portfolio. Both Unigistix's Canadian operations and SPAN International's Mexican operations boost UTi's warehousing network coverage and
provide it with added expertise for addressing the needs of automotive and electronics industry customers. As it further integrates its operations,
we anticipate that SPAN will play a major role in providing UTi with additional resources in pursuing high-margin electronics repair and
refurbishment business. These acquisitions provide UTi with greater depth in providing true end-to-end solutions from inbound logistics
through final delivery with reverse logistics support for its customers.
Fuji Film Chooses Uti as Distribution Manager
Hanover Park, IL USA - Site Visit
May 3, 2006
Fuji Film found a solution to its U.S. warehouse and distribution problems by outsourcing them to UTi Contract Logistics. UTi now
operates two distribution centers in Edison, NJ and Hanover Park, IL.
The Edison operations are fully functional shipping more than 800 orders a day. A display building/kitting line has been added rounding out
the offering.
The 220,000 square feet operation I visited in Hanover Park, IL opened five months ago and now ships twice the orders shipped before the
change. About 70% of orders are LTL, 30% are package shipments. Fuji has kept the northern end of the building for its own administrative
functions.
The primary products shipped from Hanover Park are color paper, film, cameras, chemicals and mini-lab film processing machines. There
are about 5,000 SKUs and over 13,000 rack locations. The customers are major retailers like Wal-Mart, Eckerd, Ritz and Best Buy.
On time delivery of exact orders is critical to preserve shelf space at retail customer outlets. Three key performance indicators are used to
control this requirement. Orders shipped on time including compliance with must ship orders, shipping accuracy as measured by cases
delivered without exception, and orders shipped compared to orders scheduled. The targets for these KPIs are 99.6%, 99.9% and 100%. UTi is
meeting these measures on a regular basis.
Other KPIs cover safety, housekeeping, cost, productivity, and inventory accuracy. UTi and Fuji measure productivity in cases shipped per
variable labor hour. Inventory accuracy requires a very close match (99.9%) between inventory dollar value counted and booked. This variable
is measured using daily cycle counts. Costs must meet monthly budgets.
Conformance to the KPI requirements is made by a staff of 40 warehousemen operating one staggered start 13 hour shift. This workforce
functions as a team. All of the employees and managers interact on a friendly, first name basis. All watch the KPIs closely and measure their
individual success.
For the most part, the employees were in place before UTi took over. Their pay rates stayed the same and satisfaction levels have increased.
Operating improvements are due to UTis process improvement and employee management methods. I got the impression that the guys
working in the warehouse enjoyed it. Its an impression I dont often get. Everyone is on a first name basis. Conversations are equal to equal
and this work place has harmony.
UTis process control and improvements come as standard operating procedure. At most warehouses, customer service, human resources
and financial controls are displayed as basic performance systems.
Performance system conformance is measured regularly at all UTi Contract Logistics locations by operations audits. Audits are conducted
for compliance with contract, scope, safety, security, personnel, customer service/quality, financial aspects and operations. Process
Improvement Manager, John Barrett performs most audits. He is also building profiles for each location he audits. The profiles are being
accumulated and matched for a centralized operations file at UTi Contract Logistics headquarters. Development of these files allows for better
account management, reporting and systemization of quality operating results.
As UTi tightens its processes, it improves its service uniformity at a high quality. Also, the centralization allows for consistency of replication
for new locations. As Bill Gates says, The key to sustained growth is consistent execution on service requirements. Business is not a catch and
release program. It does us no good to be reeling them in one side of the boat and tossing them out the other side.
UTis operation for Fuji at Hanover Park meets the test. Within a year, UTi will probably manage all Fuji North American supply chains
from manufacturer to customer.
Freight Forwarder UTi Seeking Higher Rates
Company says capacity and pricing pressed margins as shipping demand soared
UTi Worldwide says it is raising prices for shippers after the global freight forwarder saw its profit margins squeezed amid rapid growth in
demand in the companys fiscal first quarter.
UTi said stronger air and ocean freight volume pushed revenue up 37 percent in the three months ending April 30, but the forwarding and
logistics operators net profit grew only slightly to $10.1 million because of tight capacity and higher shipping rates.
Shipping volume returned close to the level of two years ago, UTi CEO Eric W. Kirchner said, with rising demand driving a 54 percent gain
in air freight gross revenue and a 42 percent in ocean forwarding total revenue, pushing overall gross revenue to $1.06 billion. But net revenue
grew only 18 percent, and was up only 7 percent when adjusted for currency fluctuations.
That left UTis net profit up only 2.3 percent over the same three-month period a year ago.
Kirchner said UTi now is pressing to pass along the higher rates to its shipping customers.
Our freight forwarding results were constrained by yield pressure caused by very tight capacity and higher transportation rates, he said.
We are adjusting our pricing to reflect these higher rates, yet rates continue to be volatile on many trade lanes.
It is difficult to predict when yields will stabilize, as it will depend on the future rate and capacity environment and our continued ability to
adjust pricing. We are intent on achieving our targeted margins, which may adversely impact volume growth in future months. However, we
maintain our goal of growing faster than the market, said Kirchner.
Maintaining Relationships in Challenging Times
Even in good times, maintaining relationships with suppliers, clients and 3PLs can be challenging. Add to the mix today's difficult economic
climate and it gets even tougher. Elijah Ray, senior vice president of customer solutions at Uti Integrated Logistics, and Brian Childs, of Kohler
Company, know this well and presented attendees with methods for smoothing the sometimes rocky road.
18th Edition
Ray began the presentation with some statistics: A full 20 percent to 25 percent of 3PL relationships fail within two years; up to 50 percent of
those relationships fail within five years.
If you dig into the root causes of failure, youll see that theres not a lot of emphasis on managing relationships, he said. Many companies
place too much emphasis on selling and procurement. Theres a gap there and we need to think about relationships systematically. Companies
should be able to stay together in tough times.
Ray pointed out that in tough times, many companies are out there shopping and looking for the lowest price. "But if you have the right
relationship, the cost savings are right there," he pointed out.
The common barriers to successful relationships, according to Ray, include:
A "show me the money" mentality
A short-term focus
No real sense of the cost of failure
Not understanding the positive impact of a relationship based culture
No systematic process to manage the relationship
"What are the steps to manage a relationship?" asked Ray. "Not many companies can tell you."
Constant discovery
Relationships aren't static either, Ray pointed out. "If you think change isn't going on behind the scenes, you're wrong," he said. "You have to
have constant discovery. Conversations are critical to enhancing relationships. Understand what is being said and what is not being said."
To create a culture for relationships, Ray suggested that it all begins with the individual and that certain skills can help, including empathy,
attunement, organizational awareness, influence, developing others, inspiration and teamwork.
He also suggested that companies develop an organizational sensitivity. The four dimensions of emotional intelligence include: Social
awareness; self-awareness; self-management; and relationship management. "If you have the right people involved, you have a better chance of
success," he said.
Childs added to Ray's input by talking about the importance of employee engagement. "An engaged employee is one who is fully involved in,
and enthusiastic about, his or her work," he explained. "At Kohler, we have systems in place to engage our employees."
He added that in a climate like today's, anything that was important five years ago is that much more important now. "Employee engagement,
then, can make or break you today," he said.
Employee engagement is getting increasingly difficult, however. He pointed out statistics that included:
Employee performance is declining. The number of employees exhibiting high levels of discretionary effort has decreased by 53 percent
since 2005. The solution, he said, is to increase emphasis on commitment to the organization to stimulate performance.
The disengaged are 24 percent less likely to quit in 2008 than 2006. The solutionimprove managers' focus and effectiveness at reengaging
or managing the disengaged.
High-potentials are more likely to quit. To prevent that, over invest in the delivery of their retention drivers.
For senior leaders, first focus on rational commitment to the organization, then the overall emotional commitment.
In tough times, Childs said you must also manage the cycle of fear. "You have to have candor and tell the team what you know," he said. "If
you focus on what business you'll lose next, you'll lose it. Use your energy to improve the company."
You must also engage the customer, said Childs. "Learn their businesses and functional strategies," he said. "Strategic structure is what pulls
companies through the worst of times."
He also suggested that you serve needs beyond the customers' capabilities. "In tight times, if they can do it themselves, they will, given the
resources," he said. "If they don't have the resources and you do, fill that gap."
Vendor engagement is also important. "You must trust key vendors and the relationship you hold with them," said Childs. "This is difficult in
a time where cost, more than ever, outweighs relationships in the typical 'purchasing' decision."
He also pointed out the importance of making sure your core culture matches with their core culture and to make hard decisions earlier
rather than later. Finally, he said, "Leverage the buyers' market without pushing vendors into a long-term losing position. It will only hurt you in
the long run."
UTi Worldwide: Reflections on Meeting with New CEO
(UTIW-$11.69-Outperform)
MEETINGS WITH NEW CEO. Last week we visited UTIW and met with new CEO Eric Kirchner as well as Chairman and departing
CEO Roger MacFarlane, CFO Lawrence Samuels and Director of IR Jeff Misakian.
COMMANDING PRESENCE. Eric's command of the room was apparent during our meetingsand after only 3 weeks on the job.
Roger has been advising Eric and transitioning knowledge but clearly is letting Eric run the company, as he ran our meeting.
OFF TO A RUNNING START. Eric has been CEO for less than a month and has already visited UTIW's South African and European
regions as well as North America and also hosted UTIW's annual three day executive meetings. He will be visiting UTIW's logistics operations
over the next week and then he plans to visit Asia and China within weeks.
PROCESS BEFORE A NEW DIRECTION. Our sense is that right now besides from learning the business and people, that Eric is
focused on process more than strategy. He noted UTIW's need to better leverage its corporate capabilities, without losing its sense of
entrepreneurship. That includes better process, best practices, and UTIW's "4 as 1" initiative to improve information flow from regional to
corporate. We don't expect any major strategy decisions for some time.
REDUCING ESTIMATES REITERATING OUTPERFORM. We have modestly reduced our F10 and Fl 1 EPS to account for the
further step-down in global demand since early Dec. Our sense is UTIW's previously announced $34M in pretax savings from exiting some bad
businesses, which was apparent in F3Q should be somewhat more apparent in 4Q and we would expect some additional belt tightening going
forward. Despite the massive step-down in the global economy, our sense is that Cons. EPS forecasts are closer to reality than most stocks and
at current valuations UTIW
remains one of our top picks for C09.
Investment Conclusion
UTIW's stock is down 18.5% YTD compared to our Freight Forwarder Index excluding UTIW down 17.2%, and the S&P 500 down 12.6%.
We are modestly lowering our F10 and Fll EPS forecasts by 8% each from $1.10 and $1.20 to $1.01 and $1.10 (vs. Consensus $1.11 and $1.23)
18th Edition
to account for further steep declines in global forwarding and logistics volumes mostly offset by greater Gross Yield expansion in both air and
ocean forwarding.
Still UTIW remains one of our top picks for C09 based on its forwarding business' ability to offset a material amount of volume declines
with Gross Yield expansion, its cost savings already enacted mostly at logistics, relatively easy comparisons and low expectations at a valuation
well below historical ranges.
UTIW is currently trading at 11.4x and 6.0x our below Consensus, forward twelve month EPS and EV/EBITDA estimates. This compares
to its 1, 5 and 8 year averages of 14.1x, 22.4x and 21.4x and 7.7x, 12.0x and 10.9x. Our unchanged $15 year-end C09 target price assumes a 13.5x
target forward P/E (up from 12.5x previously as we gain confidence that our estimates are getting closer to a bottom) applied out 10 months
from now to our then forward year Fll (C10) EPS forecast of $1.10 (down from $1.20 previously). Longer term we see great upside potential to
both UTIW's earnings stream and its valuation, if it can refocus again on its core forwarding business and retain a margin and return on capital
focus over market share growth. Our sense is that this is the direction the company is heading. UTIW remains rated Outperform.
18th Edition
604-255-4015
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1946
Asset Focus:
Market Area:
Founding Business:
International
Fishing Industry Services
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Brent Sugden
Allen Gerllays
Guy Shields
Joel Smith
Jewell Steckler
1,246
Ticker Symbol
1,246 **
Exchange:
8,500
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
25
Total Tankers:
Total Other:
MAJOR MARKETS
Food, Groceries
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Burger King
Food Services
Cargill
Food Production
Dannon
Kellogg
Kroger
Food Production
Nestle
Overwaitea
Canada
Restaurant Brands
Food Services
New Zealand
Tree of Life
Food Production
Unilever
US
Wendy's
Food Services
New Zealand
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
New Zealand
US
Canada
Asia/Pacific
China
Europe
VersaCold
North America
Latin/South America
Australia
Canada
Argentina
New Zealand
United States
EDITOR'S COMMENTS
VersaCold's purchase of Atlas Cold Storage in 2008 has created one of the world's largest perishable/frozen
products specialists. VersaCold has large trucking operations throughout Canada. Atlas operated primarily in
Ontario, Quebec and the United States. VersaCold dominated in British Columbia and Alberta.
Provider's Strengths
Production and retail distribution of frozen and refrigerated products.
Provider's Weaknesses
Also announces major investment in Versacold, the largest global integrated cold storage network
Los Angeles based investment firm, The Yucaipa Companies, LLC (Yucaipa) announced today the $2.0 billion global restructuring of Hf.
Eimskipafelag Islands (Eimskip), the largest shipping and logistics company in Iceland and the North Atlantic. Yucaipa worked with Eimskip
and Landsbanki to formulate a strategic plan that would allow the company to return to its core shipping and logistics business. Yucaipas
commitment to fund new equity into Eimskip marks the first major investment by a U.S. firm since Icelands economic meltdown.
Gylfi Sigfusson, CEO and President of Eimskip commented: I am pleased to announce the involvement of Yucaipa with Eimskip, as I
believe that the support of a foreign investor into Iceland is a very positive step for our whole economy and demonstrates that there are
investors willing to support Iceland going forward. We see Yucaipa as much more than a financial investor as they will also bring operating
expertise and strategic options to our re-constructed business. We look forward to exploring the options for Eimskip and other Yucaipa
portfolio companies to realize the obvious opportunities that will exist between a leader in cold storage and Eimskips shipping and logistics
operation.
Eimskip was founded in 1914 as Icelands first shipping company and ever since then has played a vital role importing and exporting goods
to and from Iceland. They also have extensive shipping and distribution operations in the Faroe Islands, Norway and Europe. They are the
leading shipping company in the North Atlantic with sales of $736 million and are an active participant in the worldwide reefer logistics business.
Yucaipa also announced today the acquisition of 49% of the shares of Versacold International Corporation from parent Eimskip and an
option to purchase the remaining 51%. Versacold is the second largest cold storage company in the world with sales of over $1.2 billion. A
provider of frozen food logistics and supply chain services, the company operates more than 120 modern, temperature-controlled warehouses
and distribution centers across United States, Canada, Argentina, New Zealand and Australia. Versacold has the largest integrated cold storage
18th Edition
network in the world and can service virtually any aspect of its customers temperature-controlled supply chain needs.
Yucaipa is also the 100% owner of Americold Realty Trust, the market leader in the United States temperature controlled food logistics.
Americold operates 104 cold storage facilities in the United States and has a sizeable transportation and distribution product offering.
At present, Yucaipa will not acquire a controlling stake in Versacold. Consequently, both Americold and Versacold will continue to operate
fully independently and compete in the marketplace.
The management teams of both companies will remain in place and fully separate. The Board of Directors of both companies will also be
fully independent. Versacolds CEO Brent Sugden comments: "This is a great outcome to our sale process. Yucaipa is well familiar with our
business sector and the food industry as a whole. We share a common vision to be a best in class company and to continue growing the business
domestically and globally. Yucaipa has the resources and expertise to make this happen. Versacold has strong brand recognition and I am
pleased that we will continue to do business as Versacold and that our management and support teams will continue to serve our valued
customers.
Ron Burkle, managing partner of Yucaipa stated that: "Versacold is a excellent company with a dedicated management team that has enjoyed
a number of successes and accomplishments that we intend to build upon. I believe that Yucaipa's complementary and extensive operations in
logistics will facilitate Versacold's current plans to expand their presence in public refrigerated warehousing, third party logistics and
transportation. Yucaipas investment will help ensure Versacold's existing customers are offered the same quality of service across an even
broader spectrum of the supply chain.
VersaCold and Atlas Come Under One Banner
VersaCold and Atlas now show a single business face to their customers and to the marketplace. Going forward, they will be operating under
the name VersaCold Logistics Services. Unifying their business will have a great clarifying effect in the marketplace. They will have one strong
brand stretching coast to coast in the US and Canada, along with the companys already existing presence in Australia, New Zealand and
Argentina.
VersaColds unifying campaign touts, We are one company, one culture, one vision, one team. The name doesnt make the company; its
our people that make the company. We know our name is only as good as we make it just the same as in our personal lives. Our dedicated
staff make the VersaCold name stand proudwe stand for high standards in everything we do . . . we are First in Cold.
Their strength lies in the local relationships theyve built with their customers, which will continue. According to VersaColds President and
CEO Brent Sugden, Our customers are the heart of our business. We look forward to sharing a long and fruitful relationship together.
VersaColds roots go back to 1946, with B.C. Ice and Cold Storage Company. By the 1980s, VersaCold established a strong operations base
in the West, with eight facilities in BC, Alberta and Washington. In the 1990s, Atlas emerged as a major player in the industry, acquiring Bell
Cold Storage in Minnesota in 1994 and entering the Canadian marketplace in 1996 with two sites in Toronto. VersaCold continued to grow and
expand with the acquisition of QF Foods and Trans Canada Freezers.
As the new century dawned, both companies continued to thrive and compete in the dynamic frozen and refrigerated food industry. Atlas
merged with Associated Freezers and acquired Blue Star Cold Storage, with operations in Alberta and BC, and CS Integrated, with 16 US
facilities and the vital 3PL business. VersaCold expanded in 2003, with the acquisition of Geneva Lakes Cold Storage and Wisconsin Logistics,
and in 2005, with the purchase of P&O Cold Logistics, adding operations in the US, Australia, New Zealand and Argentina.
Sale of the Business Announcement
As part of their Q3 press release today, Eimskip announced that they have made a strategic decision to sell Versacold Atlas.
We (Eimskip) are diligently working towards our stated goal of lowering our debt levels.
Eimskips key focus will be on streamlining our organization and the goal of bringing our equity ratio to 25%. To that end, a formal sale
process of Versacold Atlas has begun in cooperation with our engaged Canadian banks.
This is a decision by Eimskip that will enable them to delever their balance sheet and restore their business to good financial health. This was
an anguishing decision for them because they like the cold storage sector and also because Versacold Atlas has outperformed their expectations.
Our performance is what makes us such an attractive and saleable asset. Its hard to know whether to be flattered or disappointed that we will be
sold.
The key thing to keep in mind is ownership changes, but the business carries on. We continue to work together as a team to serve our
customers. This is a dynamic day to day business that is built on years of operational knowledge and relationships there is no such thing as
auto-pilot for us. We continue to make every effort to apply our specialized knowledge and thereby give our customers a competitive service
advantage.
We have many opportunities to grow the business in response to our customers growth plans and changing needs and also to respond to
other marketplace situations, including acquisitions. A change in ownership will allow us to move forward from our current steady state position
and grow the business. Our track record has proven that we are very good at this.
The sales process will probably take several months. We will keep you updated.
Best regards,
Brent Sugden
CEO, VersaCold Atlas Logistics
Acquisition of Barber Logistics marks move into 4PL
VersaCold/Atlas has expanded its New Zealand operations with the purchase of Barber Logistics, a full-service logistics provider,
specializing in supporting the Quick Service Food (QSF) industry. It operates from two facilities in Auckland and Christchurch.
This exciting move marks New Zealands first foray into Fourth Party Logistics (4PL), where we not only provide the usual storage and
logistics services, but own the stock as well.
Key customers are Restaurant Brands (NZ franchise owner of KFC, Pizza Hut and Starbucks), Wendys and Burger King.
VersaCold New Zealand looks forward to adding value to this acquisition and intends to enhance, develop and grow the combined business,
leveraging our international experience and knowledge.
EIMSKIP COMPLETES ACQUISITION OF VERSACOLD INCOME FUND
Eimskip Holdings Inc., an indirect, wholly-owned subsidiary of Hf. Eimskipaflag slands announced today that Eimskip has successfully
18th Edition
completed its previously announced offer to acquire all the issued and outstanding trust units of Versacold Income Fund. The aggregate
acquisition cost, including debt, is CDN$1,180 million.
Versacold has applied to de-list the Units and the Debentures from the Toronto Stock Exchange and will apply to the Canadian Securities
Administrators to cease to be a reporting issuer.
The acquisition of Versacold fits well within Eimskips long term strategy to build a worldwide network of temperature controlled
transportation and warehousing services. The Versacold facilities are complimentary to Eimskips and the combined company will have a
presence in the temperature controlled transportation and warehousing services market in every continent, except Africa.
Baldur Gudnason, CEO of Eimskip commented:
Versacold is a great company with a dedicated management team that has enjoyed a number of successes and accomplishments that we
intend to build upon. I believe that Eimskips complementary and extensive operations in shipping, trucking and storage will facilitate Versacold
s current plans to expand their presence in public refrigerated warehousing, third party logistics and transportation. The combination of our
companies will allow us to pursue and accelerate this vision, ensuring Versacolds existing customers are offered the same quality of service
across an even broader spectrum of the supply chain.
Brent Sugden, CEO of Versacold commented:
This is an exciting time for Versacold as we join forces with an expansive and quickly growing international transportation and cold storage
company. I am particularly pleased that we are joining forces with a company that recognizes our accomplishments at Versacold and supports
our plans for continued growth. I am impressed with the drive and energy of Baldur and the team at Eimskip, and I believe they are very well
placed to accelerate the expansion of our supply chain offering to existing and new customers....
18th Edition
Fax Number:
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 2009
Asset Focus:
Market Area:
Founding Business:
MENA
Transportation Services
Wared Transport
Wared Express
Wared Distribution
OVERALL CAPABILITY
Overall Capability of Provider:
Transportation and 3PL services in the Middle East and North Africa.
KEY PERSONNEL
Brian McHale
CEO
Pete Stiles
Richard Mansour
Marketing Mgr.
Logistics Mgr.
Ted Nelson
CIO
50
Ticker Symbol
50 **
Exchange:
1,000
ASSETS
Total Transportation Assets:
Total Tractors:
500
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
700
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
0.32
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Elements
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Proprietary
Proprietary
Proprietary
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Bahra Steel
Engineering, Construction
Syria
Caterpillar
Saudi Arabia
Saudi Arabia
Ingersoll-Rand
Industrial Machinery
Saudi Arabia
Michelin
Saudi Arabia
Premco
Engineering, Construction
Syria
Metals
Syria
Volvo Truck
Saudi Arabia
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Wared
Latin/South America
United Kingdom
Egypt
Lebanon
Saudi Arabia
Syria
United Arab Emirates
EDITOR'S COMMENTS
Wared Logistics is a joint venture between Zahid Group Holding and Construction Products Holding Company
(CPC).
Provider's Strengths
Transportation and distribution in the MENA region.
Provider's Weaknesses
veteran provide the foundation for building a world-class MENA third-party logistics service organization."
Wared Logistics has formed four operating companies, each providing unique component logistics services.
Wared Transport provides container drayage, full truckload, and specialized heavy-lift transport.
Wared Express provides Less-Than-Truckload (LTL) and Shuttle/Express transport services, including local pick-up and delivery.
Wared Distribution provides contract warehousing and inventory management services for general commodities and refrigerated products.
Wared International provides Global Trade Management services -- forwarding and customs brokerage/clearance.
"Wared provides the ultimate logistical solutions to serve its customers in the Middle East and North Africa region," stated Brian McHale,
CEO of Wared Logistics. "Starting with established operations allows Wared to deliver the quickest, most accurate, and most cost-effective
fulfillment and delivery experience for every customer."
Wared has the knowledge of the business practices, regulations, and ways-of-working in its geographies that position it for significant success.
18th Edition
905-602-2755
COMPANY BACKGROUND
Parent Corporation:
A, N
Synaps
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Doug Tozer
Owner
Barry Murphy
John Kelly
Sales Mgr.
Dir. Operations
Laurie Fox
Robert Maro
CFO
VP IS
222
Ticker Symbol
142 **
Exchange:
160
12
3
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
0
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
700
0
Total Tankers:
Total Other:
0
700
0
Total Ocean:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Food, Groceries
Industrial
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): ASKK Technologies--TEDS, Megatrans
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
Radical--CAST
Epicore
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Bellisio Foods
Bridgestone
ConAgra Foods
Constellation Brands
Beverages
Crayola
Ford Motor
General Mills
Toronto, ON
General Motors
ON
Gorton's
Beverages
CA
Primco
Canada
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Toronto, ON
Omaha, NE
Asia/Pacific
China
Europe
North America
Wheels Clipper
Latin/South America
Canada
Mexico
United States
EDITOR'S COMMENTS
The Wheels Group has been recognized every year since 1997 as one of Canada's 50 Best Managed Private
Companies and in 2003 became one of 17 companies across Canada to be inducted into the 50 Best Platinum
Club for management excellence.
In 2006, the Wheels Group acquired Clipper. The Wheels Clipper brand was launched in 2007.
Provider's Strengths
Multi-modal transportation within North America.
Provider's Weaknesses
Peter Jamison, COO, on Wheels Groups current and future growth plans
CT&L: What have been the most significant developments for Wheels Group over the past year?
Jamieson: We recently acquired the Clipper Group to expand our customer reach and capabilities within the US. We are now proceeding to
integrate our non-asset companies - Wheels International and Clipper - into one larger North American 3PL (branded as Wheels-Clipper) to
offer our customers on both sides of the border a greater product and service offering. In addition, we continue to expand our freight
forwarding efforts as Wheels Global to meet our customers' growing needs for a door-to-door service provider concentrating on the Pacific Rim
and Europe.
CT&L: Although you are repeat winners of the 50 Best Managed Companies Award, your services have garnered a considerable amount of
other forms of recognition. Can you elaborate?
Jamieson: We were also the first Canadian 3PL to achieve ISO 9001-2000 certification, and have been named a top North American 3PL by
both Inbound Logistics and Logistics Quarterly. We are also Ford Q1 qualified. But our most important strength is people. We focus on
attracting, developing and retaining the industry's best so that we can provide superior service to our many industry channels - packaged goods,
food, automotive, general manufactured and consumer goods.
CT&L: The impact from a high Canadian dollar combined with a general economic slowdown in North America is creating a much different
marketplace than what we have been accustomed to in recent years. What challenges is this posing for your specific client base?
Jamieson: Reduced Canadian export shipments into the US coupled with the overall economic slowdown has created many challenges. For
northbound shippers, this means reduced carrier capacity and increased costs, plus add the border clearance issues.
CT&L: How is Wheels responding to this new reality to help out shippers?
Jamieson: We continue to increase our carrier efforts, look for opportunities where we can provide round trip service, alternate intermodal
solutions and more innovative cross-border options around collaborative US and Canadian carriers. Our combined North American rail and
highway capabilities offer our clients stronger knowledge and strengths for transactional shipping needs. In addition, we can offer our valueadded supply chain analysis and optimization team to identify ways to both improve service and reduce overall costs. Our experts can leverage
our knowledge and strengths to find improvements in areas that may not be as efficient or may be driving costs into the supply chain. We touch
18th Edition
transportation, modes, inventory, service levels, in and out distribution, customer order agreements, business strategies and rules, etc. This
customer value solution focuses on understanding the business strategies and issues and leveraging our strengths to help identify and improve
processes, information management and implement supply chain optimization and service solutions.
CT&L: Often casts creep into supply chain functions because a company has not developed the tracking and measuring procedures necessary
to identify and isolate the costs of certain operations. How can your information technology provide them with more visibility into their cost
structures?
Jamieson: Customer focused information technology is really about delivering timely business information to both manage activities and
processes. Our Wheelslink portal provides key shipping information: load status; pick-up; enroute; delivered OTD, plus much more customertailored reporting by product such as SKU, shipping and receiving points, OTD to their end customer/receiver and performance reporting
around core supply chain elements such as production, inventory, carrier, order details etc, to focus on core causes. It is really about turning
supply information into valuable business knowledge to identify and drive change.
CT&L: Are you satisfied with the current size of your company and the breadth of its service offerings? If not, how do you plan to continue
growing in the future?
Jamieson: Wheels has had an impressive growth record. Our annualized average growth rate has been 25 since the company's inception in
1998. We see future growth through expansion into the warehousing distribution services, reefer controlled logistics, and kitting/sub assembly
services, being driven by integrated collaborative customer needs in the near future.
Wheels Group acquires Clipper Group, USA
The corporate headquarters of Wheels Group in Toronto proudly announces the acquisition of Clipper Group, a USA 3PL (third party
logistics) firm based out of Chicago, IL. A transportation and logistics service provider since 1938, Clipper currently specializes in domestic dry
and temperature controlled intermodal and truckload logistics throughout the USA.
Doug Tozer, CEO of the Wheels Group explains, "Though the acquisition immediately increases our total revenue by 75%, the subsequent
benefits to our clients are even more significant. A stronger U.S. presence, increased coverage and leveraged buying power, will grow our
business exponentially to further enhance our capabilities as a North American logistics provider with international reach."
Wheels Group of Companies
18th Edition
44 1249 710001
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1925
Asset Focus:
Market Area:
Founding Business:
International
Grocery/Dairy Distribution
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Graeme McFaull
CEO
Holly Porter
Eric Born
3,707
3,707 **
Exchange:
30,000
>50
1-5
LSE
ASSETS
Total Transportation Assets:
Total Tractors:
3,900
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
4,600
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
30.1
Total Tankers:
Total Other:
MAJOR MARKETS
Automotive
Consumer Goods
Elements
Industrial
Retailing
Technological
Food, Groceries
Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): @SYS.t3
Transportation Planning and Optimization:
Warehouse Management System (WMS):
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Adidas
Apparel
Chemicals
Argos
Arla Foods
Food Production
Armstrong Flooring
Auchan
B&Q
Specialty Retailers
BASF
Chemicals
Best Buy UK
Specialty Retailers
Bldina
BMW
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
UK
UK
Asia/Pacific
Australia/New Zealand
Europe
North America
Wincanton Logistics
Latin/South America
Austria
Benelux
Czech Republic
France
Germany
Hungary
Ireland
Italy
Norway
Poland
Portugal
Scandinavia
Slovakia
Spain
Sweden
Switzerland
Turkey
United Kingdom
EDITOR'S COMMENTS
A leading European contract logistics company, Wincanton Logistics provides services across the supply chain.
Market leader in food distribution for UK retailers, in chilled consolidation, fuel product distribution and automated
warehousing. Additional services include multi-temperature and time-critical distribution via tankers of food and
non-food products including petroleum, plus commercial vehicle fleet management. Over 60% of Wincanton's
revenue is from the UK and Ireland.
Provider's Strengths
Distribution, frozen products, range of offerings.
Provider's Weaknesses
Software catching up.
Wincanton has secured a 13 million contract renewal for the distribution of bulk LPG for Shell Gas UK, and has disposed of its recycling
business to Sims Group UK.
Wincanton has secured a two-year renewal of its UK bulk tanker distribution of aerosol propellants and LPG for Shell Gas. This builds on a
ten-year partnership and reinforces Wincanton's status as the UK market's leading bulk gas logistics provider.
The bulk tanker fleet predominantly loads from Shell Gas terminals at Stanlow in Cheshire and Mossmorran in Fife, and has a nationwide
distribution network managed from eight strategic operating centers.
In other news, Wincanton has announced the disposal of its recycling business to Sims Group UK by way of an asset sale.
The consideration of approximately 17.5 million will be paid in cash on completion and will be used to reduce debt.
Wincanton's recycling business comprises electronics recycling plants at Billingham and Daventry and sortation centers at Harlow and
Widnes. The business employs approximately 145 employees, who will transfer to Sims under TUPE on completion.
In the twelve months to March 31st, 2010, these recycling activities generated turnover of approximately 18.3 million and EBIT of
approximately 0.3 million. Gross assets as at March 31st, 2010 were approximately 8.1 million.
Wincanton looks for growth in tough market
18th Edition
With its management setting an upbeat tone, Wincantons latest figures demonstrate a good degree of resistance to the recession,
underpinned as it is by its high level of exposure to retailing in the UK. However, the company was not totally immune to the global slowdown
with profits and revenues both falling in the last financial year.
Allowing for the recession, the results are not bad. However, business outside of Britain is still struggling to gain traction. Revenue fell by
7.6% compared with 2008-9, to 2.2bn. Operating profit fell heavily from 38.9m in 2008-9 to 22.9m in 2009-10 although these figures were
affected by exceptional items including ongoing restructuring costs. Wincanton stated an underlying operating profit of 54.6m, down from the
previous years 59.6m. Underlying EBITDA was 93.2m.
The foundation of the company remains its British retail and manufacturing operations. A fall in volumes and the loss of existing customers
impacted on performance, but this was mitigated by gains in new industrial business which improved margins. Oddly it was construction,
containers and defense sectors which drove profits despite the three sectors being generally depressed. Wincantons fleet services business also
reported higher revenue and has returned to profit. Overall the underlying operating profit was 48.4m, down 7.8% whilst revenue was 1.3b
down 8.9%, although margins hardened.
The mainland European business did not do so well. In part depressed by adverse currency movement, revenue fell by 5.4% to 856.5m and
operating profit by 5.4% to 6.2m, an operating margin of 0.7%. Wincanton ascribes this in part to being hit by lower volumes and implying
that it has had to move quickly to maintain even these margins. More than 25% of the business is German road haulage and this continued to
suffer losses forcing the company to restructure the business further, leading to an exceptional charge of 14.9m. Contract logistics and
Rhineland intermodal did better, however, although demand was not strong.
Wincantons response to its difficult market conditions is to look for growth in new markets. It has outlined seven areas including existing
markets which it believes will deliver this, these being food service, record management, containers, construction, home delivery, defense and
recycling. Although this year it appears that the company has made some of these sectors pay, it might be tough to squeeze growth out of them
quickly.
A new dimension in custodial services
Wincanton combines forces with Serco to bid for contracts to manage prisoner escort services on behalf of the Ministry of Justice
Wincanton plc (Wincanton or the Group), the leading European provider of supply chain and business outsourcing services, has entered
into a joint venture with international service and business outsourcing provider, Serco. Its first initiative will be to bid for contracts to manage
the escort of prisoners on behalf of the Prisoner Escort and Custody Service (PECS).
PECS, which operates under the aegis of the Ministry of Justice, is responsible for the escort of prisoners to and from courts in England and
Wales around one million people each year.
The venture will see the creation of a new company, Serton, harnessing Wincantons logistics and fleet management expertise with Sercos
proven track record in custodial services.
Wincanton is a FTSE-listed pan-European UK-based organization with a turnover of 2.36 billion employing 30,000 people. With a proven
track record in international logistics, the company works in partnership with a host of blue-chip clients to help them run their businesses more
efficiently.
Serco is a FTSE-100 international service company employing 70,000 people around the globe. With 10 billion worth of public and private
contracts, Serco already manages four UK adult prisons for the Ministry of Justice and also runs custodial facilities in Australia and Germany.
Graeme McFaull, Chief Executive, Wincanton, said: We are delighted to be working with Serco and creating a powerful alliance of equal
partners. Our two companies share similar values, defined by an uncompromising commitment to excellent customer service.
By combining Wincantons experience across the supply chain with Sercos seasoned expertise in custodial services, the new company will
get the best from both organizations.
There is an increasing enthusiasm of governments around the world for public private partnerships, and we will provide dedicated, assured
services for all stakeholders while maximizing care and professionalism.
Goodman/SWIP leases to Wincanton in UK
Global property group Goodman and Scottish Widows Investment Partnership (SWIP) has leased a major new 220,000 sq ft distribution
centre at Hoddesdon Commercial Park, in Hertfordshire, to European logistics provider Wincanton.
Wincanton has taken a 15 year lease and plans to open the new facility in July to support the company's growth within the foodservice sector.
It replaces the company's regional foodservice operations currently based at Luton and Dunstable and will provide significantly increased
capacity to serve Wincanton's growing network of customers across the region.
Goodman and SWIP formed a 50:50 joint venture in 2006 to fund and develop 895,000 sq ft of space at Hoddesdon Commercial Park. This
partnership has led to 850,000 sq ft of industrial and distribution space being built in less than 30 months.
David Jones, Managing Director for Foodservice, Wincanton said: "The site at Luton is both old and constrained in terms of size to meet
current challenges and our anticipated further business growth. This new 220,000 sq ft modern facility, will allow us to greatly enhance the
service to our customers, enabling both Wincanton's ambitious growth plans and those of our existing customers to be met."
Wincanton wins contract with Best Buy UK
Wincanton has secured a five-year storage and distribution contract with Best Buy, a leading consumer electronics retailer, ahead of its launch
in the UK in Spring 2010.
Wincanton has refitted a distribution centre at its Daventry site for Best Buy and has developed software to integrate with the retailer's IT
systems, enabling efficient goods monitoring and distribution.
Stuart Lacey, Supply Chain Director for Best Buy UK said: "I'm delighted to announce Best Buy's partnership with Wincanton. I'm confident
that together with the team at Wincanton, we will bring Best Buy's enthusiasm and passion for providing a high level of customer service to the
homes of our customers."
Wincanton's Chief Executive, Graeme McFaull, commented: "This partnership confirms Wincanton's market leadership in the retail sector
and demonstrates the continued growth of our core business in the UK & Ireland, complementing the progress we are making in Mainland
Europe and in our newer sectors and services."
"Best Buy is one of the most exciting companies in global consumer electronics retailing, and we are delighted to be working with them,
particularly as Best Buy's values mirror our own. We're both equally passionate about customer service - it's at the core of everything we do."
18th Edition
Wincanton has announced that it is restructuring its in-house groupage network in Germany and joining a new groupage co-operation.
Management says that this new co-operation will meet the groupage requirements of its customers but materially reduce the infrastructure costs
associated with an in-house network. It will also substantially reduce the Group's exposure to fluctuations in market volumes.
The restructuring involves the closure of three loss-making groupage depots. It is also withdrawing from the currently loss-making groupage
activities at a further four locations to enable these sites to increase their focus on their profitable warehousing and transport management
operations. The remaining sites, which are already profitable, will continue with their current mix of warehousing and transport management but
will in future contribute their groupage volumes into a new partnership with ILN, an existing Pan-European network operator.
The loss-making groupage activities being closed or restructured will address the material adverse effect of the in-house network upon the
profitability of both Wincanton's transport management activities and its German business as a whole. The restructuring, which is scheduled to
be fully implemented by the end of the third quarter of the current financial year, is expected to deliver a profitable, less volatile business base
for the Group in Germany but will lead to an exceptional charge of up to 13m.
Commenting on the announcement, Graeme McFaull, Wincanton Chief Executive, said: The restructuring announced today, which we
expect to deliver an attractive profit and cashflow payback, will enable us to focus more clearly on the significant growth opportunities for
Wincanton in the German market and contribute positively to our overall progress in Mainland Europe.
18th Edition
fdangelo@yobelscm.biz
511-460-0754
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1965
Asset Focus:
Market Area:
Founding Business:
International
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Aquiles Diaz
Fancisco D'Angelo
Julio Velayos
Managing Director
Commercial Mgr.
100
Ticker Symbol
100 **
Exchange:
4,500
30
3
ASSETS
Dedicated Contract Carriage Power Units/Trucks:
Total Tractors:
Total Trucks:
Total Other:
500
Total Trucks:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
500
1.2
4
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Food, Groceries
Healthcare
Retailing
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): BPCS/SSA
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Proprietary
BPCS/SSA
18th Edition
BPCS/SSA
BPCS/SSA
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
ABL Pharma
Pharmaceuticals
Peru
Alberto-Culver
Peru
Beiersdorf
Belcorp
Bticino
Peru
Colgate-Palmolive
Peru
Eastman Kodak
Peru
L.M. Ericsson
L'Oral
Peru
Ollas Essen
Argentina
Colombia, Guatemala, Me
Recamier
Peru
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
Yobel
North America
Latin/South America
Mexico
Argentina
Chile
Colombia
Costa Rica
Dominican Republic
Ecuador
El Salvador
Guatemala
Panama
Peru
Puerto Rico
United States
EDITOR'S COMMENTS
Yobel is a supply chain management company providing services in the Latin America Region (12 countries).
Yobel's manufacturing capabilities are in Chile, Mexico and Peru.
Provider's Strengths
Capable warehousing and manufacturing with good Latin American coverage.
Provider's Weaknesses
Yobel SCM Manufacturing has been certified with USO 9001; it has met the requirements that ISO demands according to the auditing held
on January 29-31, 2003, by Bureau Veritas.
This Certification encompasses filling, formulation, production and sales of cosmetic and personal care products, as well as the design and
manufacturing of plastic packaging.
Yobel Supply Chain Management Broadens its Horizons
May, 2003 Yobel Supply Chain Management has shown that the experience, dedication and professionalism of their employees can open
new horizons and possibilities of new businesses abroad.
Two years ago, Yobel Supply Chain Management started its internationalization by beginning operations in Chile. The goal was not only to
start a business abroad, but to globally integrate itself into the international logistics network, so that its customers could find the same
philosophy with one logistics operator in the whole region.
This will allow Yobel to turn into a common strategic partner for all the customers of international corporative accounts. This has given
them a great competitive advantage. Yobel Supply Chain Management has turned into an excellent alternative to meet that requirement. There
fore, in addition to the operations in Chile, they have started businesses in Puerto Rico in 2001 and this year in Dominican Republic, Colombia,
El Salvador, Ecuador and Guatemala.
18th Edition
81-3-3669-8540
COMPANY BACKGROUND
Parent Corporation:
NYK Line
Asset Focus:
Market Area:
Founding Business:
International
Air Freight Forwarder
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Shunichi Yano
President
Shoji Murakami
Masaki Tanaka
1,202
292 **
5,065
Exchange:
TYO
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
Total Tankers:
Total Other:
MAJOR MARKETS
Technological
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): ICSS, CargoWise, YUNAS
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Network Modeling/Site Location:
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Applied Materials
Micron Technology
National Semiconductor
Texas Instruments
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
Location
TM
WM
VA
DCC
Inte IM
Asia/Pacific
North America
Latin/South America
Austria
Canada
Brazil
Hong Kong
Benelux
Mexico
India
Czech Republic
United States
Indonesia
France
China
Australia/New Zealand
Yusen
Australia
Germany
Japan
Hungary
Korea
Italy
Malaysia
Poland
Philippines
Russia
Singapore
Spain
Taiwan
Sweden
Thailand
Turkey
Vietnam
United Kingdom
EDITOR'S COMMENTS
Yusen Air & Sea, sister company of NYK Logistics, is a major airfreight operation, particularly within Asia. It
recently set up a strategic agreement with Panalpina.
Yusen Air & Sea handled over 135,000 tons of export airfreight from Japan in 2009. Japan accounts for nearly
50% of the business.
NYK Logistics and Yusen Air & Sea are slated to be merged into one company, Yusen Logistics Co., Ltd., in
2011.
U.S. Contact Information:
Yusen Air & Sea Service (USA), Inc.
377 Oak St., Ste. 302
Garden City, NY 11530
Phone: 516-222-1777
Fax: 516-222-0003
Provider's Strengths
Airfreight logistics.
Provider's Weaknesses
Over reliance on Japanese customers.
In his New Years Speech to the company on Monday, NYKs president Yasumi Kudo said that the company needed to merge its contract
logistics business, NYK Logistics, with its airfreight forwarding business, Yusen Air & Sea Service, to establish a structure capable of fully
serving all logistics needs of customers.
But he added that the merger will not prove effective until the company fosters logistics professionals fully versed in all aspects of ocean/air
freight forwarding and contract logistics on a worldwide basis.
This year we are keeping up a vigorous exchange of personnel among our liner trade division, NYK Logistics and Yusen Air & Service in
Japan which began last summer, a spokesman told Automotive Logistics News. The personnel exchange in overseas has not begun yet.
Kudo outlined that the company was still pursuing its Yosoro Project in response to the economic crisis that saw export shipments of new
cars from Japan almost halved in 2009 on the previous year, far exceeding the earlier projected downturn.
Yosoro, which means Steady Ahead, has led to the scrapping of surplus vessels, including car carriers, as well as aircraft, warehouses and
trucks. Car carrier vessels were down from 130 vessels to approximately 90 vessels at the end of 2009, as predicted in February 2009 by
Mikitoshi Kai, head of investor relations at NYK.
This scrappage will continue in 2010. Those car carriers still operating, like the companys container vessels, which saw a fall in volumes
shipped of around 15%, continue to slow steam along their trade routes.
Further slimming down strategies are due for the new year according to Kudo. We must redouble these efforts to slim down surpluses and
achieve the restoration of profits by all means during the second half of the current fiscal year, he said.
With regard to the impact on automotive customers, an NYK spokesperson said that the merger of the NYK Logistics and Yusen Air & Sea
Service will allow the company to better serve the logistics needs of its customers in ocean/air freight forwarding and contract logistics at one
stop.
The benefit is not limited to ocean freight. For the automotive sector, we offer the PDI operation, terminal business and milk run as well as
cross dock, he said.
The companys outline for structural reform includes the strengthening of vehicle transport by sea through the establishment of a more
flexible fleet mixture that can accommodate fluctuations in cargo volumes and changes in fleet planning policies. It is also aiming to enhance its
ability to meet export demand from China and India.
Panalpina Japan goes operational
Panalpina and the NYK Group have agreed to realign the level of their current cooperation in Japan. Panalpina Japan will entirely in-source the
air and ocean freight operations effective January 2010. In line with an earlier agreement communicated in February 2007, Panalpina will
continue to represent the NYK subsidiary Yusen Air & Sea Service interests in various countries.
In February 2007, Panalpina appointed the NYK subsidiary Yusen Air & Sea Service Ltd. (YAS) as its agent for the handling of air and ocean
freight shipments in Japan. YAS in turn assigned Panalpina to be its representative in several countries.
With the new contractual agreement Panalpina Japan will entirely in-source its ocean freight and air freight operations currently handled
through YAS as freight forwarding agent for the Panalpina Group. YAS will, however, continue to provide services in Japan as a subcontractor
for Panalpina. Already as of November 1st 2009, Panalpina Japan will start issuing freight invoices and arrival notices for ocean import
shipments. Panalpina Japan and its partner YAS are committed to ensure a smooth transition for its customers and business partners with its
existing branches in Tokyo (Head Office), Osaka, Nagoya and Hiroshima/Fukuoka.
The strategic partnership between Panalpina and NYK group will remain unchanged: As a freight forwarding agent, Panalpina will continue
to represent the interests of YAS in 23 countries across Latin America, Africa, Europe and the Middle East. In addition, both companies will
provide dedicated services for the respective partner and YAS can still benefit from Panalpinas extensive global network. This way both parties
will continue to strengthen their respective networks.
An even stronger presence in the Japanese market under the Panalpina brand supports our global strategy with focus on global supply chain
management solutions. In addition we can further strengthen our network, comments Panalpina CEO, Ms Monika Ribar.
According to Andreas Behnke, Country Manager of Panalpina Japan, "Panalpina Japans operational status change will even intensify the
local collaboration between Panalpina and YAS in Japan. Furthermore Panalpina will be able to offer a much wider service portfolio under its
own brand name to its customers.
Yusen Opens China Warehouse
Yusen Air & Sea Service Co., Ltd., the core logistics arm of NYK Line, announced that it has established a Mexican subsidiary to strengthen
its local services in that country.
Yusen Air & Sea Service (Mexico) S.A. de C.V. is capitalized at 5 million Mexican pesos ($372,000) and wholly owned by YAS.
The Mexican subsidiary, which opened for business on Jan. 2, is headquartered in Monterrey and has a branch office in Mexico City, Tokyobased Yusen said.
Yusen to this point has operated in Mexico through the representative offices in Monterrey and Mexico City of its wholly-owned United
18th Edition
Yusen Air & Sea Service (YAS) has become the second major Japanese global forwarder this year to announce a significant development in
Monterrey, Mexico, close to that country's border with the US. The first was Nippon Express.
YAS announced this month that Yusen Air & Sea Service (USA) Inc had expanded and moved its Monterrey representative office on
September 1. "Located near the US border, Monterrey serves as a base for Mexican-American cross-border logistics, along with Laredo Service
Centre on the US side of the border," explained YAS.
It said YAS (USA) provided 300 trucking services per month between Monterrey and Laredo. In Mexico, the company also provided VMI
(vendor managed inventory) services, which stored auto parts in bonded warehouse through contracted local agents and delivered them to
clients' facilities as necessary.
YAS said the group as a whole had focused on America as a priority area for special reinforcement in its mid-term business plan, 'YAS FiveStar Project'. "South and Central America, and the Mexican market in particular, represent a growth area and are attracting considerable inbound
investment. YAS (USA) has been providing logistics services for automotive products and will continue to be proactive in building this business."
Earlier this year, Nippon Express USA de Tijuana S.A. de C.V. (NE Tijuana), a company owned by Nippon Express USA Inc, itself a
subsidiary of Japanese forwarder Nippon Express Co Ltd, announced that it had opened a new business location in Monterrey. "Monterrey is
Mexico's third largest industrial city and as such has attracted numerous Japanese automobile companies and other manufacturers. This has led
to a tremendous expansion in the volume of cargo handled in the area," stated Nippon Express.
It added that NE Tijuana's principal operations involved the import of raw materials and parts/components from Japan, Asia and other
sources, the storage of finished and semi-finished goods, and distribution processing.
The Nippon Express Group now has seven locations in Mexico - five offices (Mexico City, Guadalajara, Monterrey, Manzanillo and
Aguascalientes) established by Nippon Express de Mexico S.A. de C.V., and NE Tijuana's two offices in Tijuana and Monterrey.
18th Edition
52 55 1940 1928
COMPANY BACKGROUND
Parent Corporation:
Year Started in Logistics: 1979
Asset Focus:
Market Area:
Founding Business:
Mexico
Warehousing
OVERALL CAPABILITY
Overall Capability of Provider:
KEY PERSONNEL
Lliana Gmiz
General Director
Lorena Gmiz
Francisco Castillo
Marketing Mgr.
Commercial Director
80
Ticker Symbol
80 **
Exchange:
1,129
ASSETS
Total Transportation Assets:
Total Tractors:
Total Trucks:
Total Trucks:
Total Other:
Total Trailers:
Total Aircraft:
Total Ocean:
Total Other:
Total Reefers:
Total Flatbeds:
2.4
Total Tankers:
Total Other:
MAJOR MARKETS
Consumer Goods
Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating:
Software Vendor/Brand:
Software Type:
Transportation Management System (TMS): Proprietary
Transportation Planning and Optimization:
Warehouse Management System (WMS):
Manhattan--PkMS
18th Edition
EDI Handling
ERP Interfaces
Transportation Execution
Contract File Maintenance
Transportation Services
Air Freight Forwarding
Rail
Exception Handling
Pre-Audit
Consolidation/Deconsolidation
Rail TOFC/COFC
Load Tendering
Post-Audit
Loss/Damage Claims
Tracking & Tracing
Performed In-house
Outsourced
Freight Brokerage
Home Delivery
Small Package
Specialized
Truckload (TL)
Refrigerated
Value-Added Services
Call Centers
Rail Siding
Kitting
Pick/Pack
Labeling
Lot Control
Pool Distribution
Repair/Refurbish
Specialty Packaging
Merge in Transit
Sub Assembly
KanBan
Manufacturing Support
Reverse Logistics
Cross Docking
Customization
Sequencing/Metering
Installation/Removal
Order Mgmt
Food Grade/Sterile
Quality Control
Union Services
Temperature Controlled
Areas Served
Africa/Middle East
Duty Drawback
LCL Consolidation
Customs Brokerage
Export Crating
Port Services
Location
Colgate-Palmolive
Mexico
Energizer
Mexico
Maybelline
Mexico
tesa Tape
Manufacturing
18th Edition
Latin/South America
North America
CUSTOMERS
Customer
Europe
Asia/Pacific
Australia/New Zealand
TM
WM
VA
DCC
Inte IM
Asia/Pacific
Europe
North America
Zimag
Latin/South America
Mexico
EDITOR'S COMMENTS
Zimag is one of Mexico's largest 3PLs. Their customer focus is mainly in the retail, food and beverage,
healthcare, and consumer goods industry segments.
Provider's Strengths
Warehousing and distribution.
Provider's Weaknesses
[HispanicBusiness.com]
ATLANTA, March 31 /PRNewswire-FirstCall/ -- Manhattan Associates , the global leader in providing supply chain execution (SCE)
solutions, today announced that Zimag Logistics, Mexico's largest third party logistics (3PL) company, has selected Manhattan Associates'
industry-leading supply chain execution solution, PkMS(R). Zimag selected PkMS to replace its legacy system following a two-year evaluation of
competitive offerings. Zimag switched to PkMS to meet the increasingly sophisticated distribution needs of its Fortune 1000 clients including
Colgate-Palmolive, Energizer, Maybelline and Tesa Tape. The company expects that by deploying PkMS and adding radio frequency (RF)
technology in the distribution center (DC) it will be able to reduce cycle times, while providing Zimag and its customers with increased inventory
visibility and additional control of the supply chain.
At Zimag Logistics, technology is of the utmost importance and distinguishes us from others in the 3PL marketplace," said Iliana Gamiz,
general director at Zimag Logistics. "Manhattan Associates' PkMS will provide us with a scalable, flexible supply chain execution solution that
can address the diverse needs of our clients. In addition, this implementation will make Zimag one of the first Mexican 3PL companies to offer
its clients RF technology and an advanced, functionally robust warehouse management system -- a differentiator that will truly provide us with
the competitive advantage needed to secure new business and continue to satisfy our current customer- base."
With PkMS, Zimag will gain greater control over, and more information about, its customers' supply chains. PkMS, coupled with RF
technology in the DC, will provide Zimag and its customers with real-time information about inventory levels and the location of inventory
within the supply chain. The combined solution will also help Zimag increase the efficiency of its pick- pack-ship process, saving both time and
money. Additionally, PkMS will enable Zimag to offer more customized services to its customers, allowing Zimag to keep its current customers
satisfied and make their services more attractive to potential new customers that have increasingly sophisticated and specialized supply chain
requirements.
PkMS enables 3PL companies such as Zimag to gain exacting control over their distribution center operations, including receiving, inventory
management, replenishment, order personalization, picking, packing and shipping. The result is a more streamlined operation with improved
supply chain performance and the efficiencies 3PL's need for their diverse customer- base. Additionally, PkMS enables multi-client support
within a single distribution center by supporting multiple order profiles, SKU profiles, product handling requirements and value-added services.
18th Edition