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Optimization Tools Find Redemption

Food Logistics

Originally published 2/6 in Food Logistics magazine

Remember the grandfatherly Shawshank Redemption character Brooks Hatlen – incarcerated since youth – lamenting his new life outside, on parole, in a letter to his former prison-mates saying, “The world went and got itself in a big damn hurry”? Well, it’s true!

Supply chains are being called on to become more efficient and responsive to keep up with the demands of ever stiffening competition. And sorry, Brooksie, but the pace is only accelerating; especially when it comes to the food supply chain. Yet it wasn’t until recently that shippers began to really embrace the agility enabled by optimization software.

So why weren’t shippers in a “big damn hurry” to adopt optimization and what made them come around?

Back in early 2010, Walmart instituted “must arrive by date” (MABD) compliance guidelines to improve their supply chain reliability and which penalized shippers unable to deliver within a (typically) 4-day window. It didn’t take long for competing concerns to adopt this new MABD standard to “keep up with the Waltons’” high standards for product freshness. As if dealing in perishable product weren’t stressful enough, ag-producers and other food shippers scrambled to find ways to ensure quicker, more efficient deliveries.

Well, what food shippers viewed as aggravation, transportation management solution providers saw as a spur to innovation. IT solution providers serving the supply chain industry had already been experimenting with algorithmic programs to optimize freight, routing and even entire transportation networks, for years by the time Walmart imposed MABD. Early innovators fielded commercially available optimization tools, but were met with the characteristic resistance to change. But it wasn’t until shortly after Walmart changed the rules that adoption rates for optimization tools began to really take off.

Shippers now had a compelling reason to take a chance with transportation management systems (TMS), automated freight optimizers and network optimization tools.

The MABD was a catalyst for today’s high rate of adoption for TMS and optimization software. In fact solution providers even developed configurable options for considering MABD in addition to things like transit time and delivery date; and best-in-class optimization software can look at MABD windows when doing optimizations.

What many shippers were not inclined to look at through the prism of technology – i.e. ways to leverage automation to shorten delivery times and improve transportation efficiency – have become the focal point of their attention as the penalties for inefficiency grow too big to ignore. Add to this, rising fuel costs and falling capacity and the business case for TMS and optimization software has become nearly indisputable.

So, to borrow a phrase from Andy Dufresne (and with apologies to Steven King) “It comes down to a simple choice - get busy optimizing or get busy paying!”

Posted: Feb 22, 2013


ATCM Reveals Whether a TMS is TRU-ly Strategic

Food Logistics

Originally published 2/21 in Food Logistics magazine

A transportation management system (TMS) utilized to its fullest potential, becomes a truly strategic supply chain management tool. TMS can help enforce compliance with all manner of business rules; provide auditability to reveal deviations from planned/approved shipping activities; even deliver insight into the effects of transportation issues on overall product cost. The rub is, not all TMS solutions are created equal and the weaker ones often color the market’s perception regarding all TMS solutions – even the most robust.

Want an example of how a best-in-class TMS solution adds strategic value to the overall supply chain?

In 2004, the California legislature passed the Transport Refrigeration Unit (TRU) Airborne Toxic Control Measure (ATCM), mandating the use of low-emission TRU equipment for all trucks shipping product in or out of the Golden State. With the 12-year phase-in process nearly complete, most carriers have decided whether to make their equipment compliant or forgo working in CA.

However, the law’s impact on shippers’ transportation decisions adds another variable to the already staggering list of things transportation managers must consider when building shipments and routes. Which carriers are compliant with updated equipment? Which ones have decided they simply will not accept tenders into or out of California? How will this unique, single-state requirement impact on the cost and timeliness of my shipments to or from CA?

California’s ATCM is the perfect example of how inevitable changes in the market test the flexibility of any TMS. All TMS solutions claim to offer the flexibility to adapt to such occurrences and afford users the ability to take a strategic view of the ramifications of such a change. But is such an adjustment effortless and easy to accomplish? Or is it a huge hassle that will likely be swept under the rug? If a TMS cannot adapt easily, over time, hundreds of relatively minor considerations like this one can add up to major, unnecessary expenses.

Being a strategic supply chain tool requires being able to accommodate emergent modifications to tactical functions like routing and tendering. But for some solutions, making the following change in real-time is not an easy or intuitive process. Best in class TMS programs should be able to:

  • Quickly, easily, broadcast a message to the entire carrier base asking each carrier to update their established carrier profile reflecting whether or not they’re compliant with ATCM for TRU

  • Collect carrier responses

  • Identify and remove non-responsive carriers

  • Load updated carrier profiles back into the system

Once the carrier profiles are updated via the automated communications systems and non-responders are removed, tendering can see equipment requirements or SKUs that require TRUs. Only California TRU-compliant carriers will be offered the tender in the auto-tender process. Transportation managers enjoying full visibility into the costs (in both time and spend) incurred by ATCM on all California shipments, remain fully aware of how this issue affects their budgets. As a result, they can take whatever steps are necessary, such as revisiting shipment schedules to minimize trips into CA; or informing their sales teams of the need to adjust pricing for customers requiring CA shipments.

If a TMS does not support the above best practices, it will be up to system users to do the labor-intensive work of determining if each carrier is compliant for CA shipments. This adds a manual, work-around back into the process (assuming they don’t simply avoid the issue). Sounds a lot more tactical than strategic, doesn’t it?

Posted: Feb 22, 2013


Food Logistics Announces its 2012 Top 100 3PL & Cold Storage Providers

Food LogisticsFort Atkinson, WI - August 15, 2012 - Food Logistics, the only publication dedicated exclusively to the food and beverage supply chain, this week announced those companies chosen as the Top 100 3PL & Cold Storage Providers for 2012.

The Top 100 3PL & Cold Storage Providers serves as a resource directory of third-party logistics and cold storage providers whose products and services are critical for various companies in the food and beverage supply chain, ranging from food producers and manufacturers to retail grocers and small format markets.

"The companies on this year's list offer tremendous value to their customers in the food and beverage sector, starting with their understanding of the requirements and demands unique to this space," commented Lara L. Sowinski, editor-in-chief at Food Logistics. "For one, food and beverage supply chains operate in a highly regulated environment where safe and secure transportation and warehousing of the product, which oftentimes involves temperature-controlled facilities and equipment, is paramount. In addition, the constant introduction of new products coupled with increased consumer demand for more fresh produce raises the stakes even higher."

Companies on this year's Top 100 3PL & Cold Storage Providers list will be profiled in the July/August 2012 issue of Food Logistics, as well as online at www.foodlogistics.com.

They include, in alphabetical order:

A.N. Deringer, Inc., Allen Lund Company, AM Transport Services, Inc., American Cold Storage-Tulsa, LP, Ammex Services, APL Logistics, ArrowStream, Aspen Logistics, Inc., Atlanta Bonded Warehouse Corporation, BM2 Freight Services, Inc., Bolingbrook Cold Storage, Burris Logistics, C.H. Robinson Worldwide, Inc., Capstone Logistics, LLC, Cardinal Logistics Management Corporation, CaseStack, Classic Transportation & Warehousing, Cloverleaf, Columbian Logistics Network, Conestoga Cold Storage, Cryo-Trans, DB Schenker, Derstine's Inc/EZ3PL, DSC Logistics, DSW Distribution Centers, Inc., Dura Freight, Inc., Echo Global Logistics, England Logistics, FAC Logistics , Flagship Logistics Group, Friopuerto, FST Logistics, H & M Bay Inc., Hall's Warehouse Corp., Hanover Logistics, HCI Logistics, Hellmann Perishable Logistics a division of Hellmann Worldwide Logistics, Henningsen Cold Storage Co., Hermann Services, Inc., Inmar, Interstate Transport, J.B. Hunt Transport Services, Inc., Jacobson Companies, Jameson Logistics, Jarrett Logistics Systems, Johanson Transportation Service, Kane is Able, Kenco Logistic Services, KTI, LTD., Lily Transportation Corp., Lineage Logistics, LMTS, Matson Logistics Inc., Menlo Worldwide Logistics, Metro Park Warehouses, Midwest Refrigerated Services, Millard, Murphy Warehouse Company, Newport-St. Paul Cold Storage Co., Next Generation Logistics, Inc., NFI Industries, Nor-Am Cold Storage, Nordic Cold Storage, ODW Logistics, Inc., Pacer, Palos Garza, PFS Logistics, Pioneer Cold, Inc, ReTrans, Inc., Ristow Logistics, RLS Logistics, RMX Global Logistics, RTL Services, Inc., Ruan Transportation , RWI Transportation, LLC, Ryder Supply Chain Solutions, Saddle Creek Logistics Services, Scotlynn , Seaonus, Shippers Warehouse, Stanford Refrigerated Warehouses, Star Distribution Systems, Inc., States Logistics Services, Inc., Strive Logistics, Sunteck Transport Group, Total Quality Logistics, Trademark Transportation, Inc., Transplace, Ultra Logistics, US Perishables, Vantix, Veracity Logistics, Verst Group Logistics, Wagner Industries, Inc., Warehouse Shippers Inc. (WSI), Weber Logistics, Werner Enterprises, Wheels Group, Witte Bros. Exchange Inc., WOW Logistics

About Food Logistics
Food Logistics is published by Cygnus Business Media, a leading diversified business-to-business media company. The publication serves the information needs of executives involved in various aspects of the food and beverage supply chain. Through our print and online products, we provide news, trends, and best practices that help more than 24,000+ grocery and foodservice suppliers, distributors, and retailers make better business decisions. Visit us online at www.foodlogistics.com.

Posted: Aug 15, 2012

 
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