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2016 TOP 3PL & COLD STORAGE PROVIDERS

Food Logistics [

ROBOTICS & AGVS

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EVOLUTION, NOT REVOLUTION

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Global Supply Chain Solutions for the Food and Beverage Industry

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HOW HYPERMODAL TRADE WILL TRANSFORM LOGISTICS

ARE YOU READY FOR FSMA?

SOLAS RULE

FDA TAKES A NON-PRESCRIPTIVE TACK

OCEAN CONTAINER WEIGHT REQUIREMENT BEGINS

Issue No. 179 August 2016 FoodLogistics.com

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Jane Kennedy Greene leads Kenco Logsitics in providing vertically integrated and engineered solutions with its partners.

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3PL & COLD STORAGE PROVIDERS This year's list reveals a noticeable trend. Specifically, more providers are adding new services to their portfolios to meet industry demands, which range from compliance with food safety and transportation regulations to customer-driven requirements for real-time tracking and temperature monitoring. Ultimately, 3PLs and cold storage providers on the 2016 list are committed to investing in their operations to stay ahead of the curve. Congratulations to these ÂŽ companies for their dedication. Global Supply Chain Solutions for

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Logistics the Food and Beverage Industry

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Since 1991

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2016

Logistics THE 11TH ANNUAL

TOP

3PL & COLD STORAGE PROVIDERS This year's list reveals a noticeable trend. Specifically, more providers are adding new services to their portfolios to meet industry demands, which range from compliance with food safety and transportation regulations to customer-driven requirements for real-time tracking and temperature monitoring. Ultimately, 3PLs and cold storage providers on the 2016 list are committed to investing in their operations to stay ahead of the curve. Congratulations to these ÂŽ companies for their dedication. Global Supply Chain Solutions for

Food

Logistics the Food and Beverage Industry

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ON THE MENU

OCTOBER 2015 ISSUE NO. 171

ON THE MENU

AUGUST 2016 ISSUE NO. 179 COLUMNS FOR STARTERS

COVER STORY

ARE YOU READY FOR THE FSMA? The U.S. Food and Drug Administration takes a non-prescriptive approach to food safety.

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ANNUAL 3PL & COLD STORAGE LIST

FEATURES

THIRD-PARTY & REFRIGERATED LOGISTICS

26 Foodservice Industry Prepares for Big Challenges on Many Fronts

Food Logistics’ 2016 Top 3PL & Cold Storage Providers 34

2016

TOP

More providers expand their portfolio of services to meet changing customer demands.

Moving from Providers to Partners 6

The expectations today require logistics providers and cold storage operators to take their relationships to even deeper levels of collaboration. COOL INSIGHTS

How Technology Innovation Transforms the Cold Chain 16

Cold chain logistics providers now have an opportunity with new technologies that gather and analyze data, then report findings to customers throughout the supply chain. FOOD (AND MORE) FOR THOUGHT

Food Logistics Industry Embraces Big Data to Optimize the Supply Chain 68

And ultimately, the customer experience is elevated.

Food safety laws, labor regulations and new consumer demands call for action.

SECTOR REPORTS

DEPARTMENTS

SPECIAL REPORT

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Robotics and Automation: Evolution, Not Revolution

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SOLAS Ocean Container Weight Rule Takes Effect 30

A new safety requirement pushes the maritime industry to better organize its information management.

WAREHOUSING

Robots take on more picking, sorting and packaging as technology advances. TRANSPORTATION

58 Reefer and Trailer Manufacturers Raise the Bar

Temperature control and green options expand to further enhance cold chain integrity. SOFTWARE & TECHNOLOGY

How Hypermodal Trade Will Transform Logistics 62

A report by Lux Research explores how Big Data and analytics are improving logistics. OCEAN CARRIERS & PORTS

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Supply Scan 12 Food on the Move 67 Ad Index

66 Leading Carriers Investing in Real-Time Tracking Solutions Enhanced visibility and control are important benefits for temperature-sensitive cargoes.

WEB EXCLUSIVES • McDonald’s Franchisees Fear Switch to Fresh Beef Will Bring Safety Disaster foodlogistics.com/12234874

• Florida East Coast Railway Celebrates First Big Ship via Expanded Panama Canal at PortMiami foodlogistics.com/12231264

• Food Logistics’ Educational Webinar Series foodlogistics.com/webinars

Published and copyrighted 2016 by AC Business Media Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher. Food Logistics (USPS 015-667; ISSN 1094-7450 print; ISSN 1930-7527 online) is published 10 times per year in January/February, March, April, May, June, July, August, September, October and November/December by AC Business Media Inc., 201 N. Main Street, Fort Atkinson, WI 53538. Periodicals postage paid at Fort Atkinson, WI 53538 and additional mailing offices. POSTMASTER: Send address changes to Food Logistics, P.O. Box 3605, Northbrook, IL 60065-3605. Canada Post PM40612608. Return undeliverable Canadian addresses to: Food Logistics, Station A, P. O. Box 25542, London, ON N6C 6B2. Subscriptions: U.S., one year, $45; two years, $85; Canada & Mexico, one year, $65; two years, $120; international, one year, $95; two years, $180. All subscriptions must be paid in U.S. funds, drawn from a U.S. bank. Printed in the USA.

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FOR STARTERS

FROM THE EDITOR’S DESK

DETAILS

MOVING FROM

PROVIDERS TO PARTNERS W SOWINSKI

hen speaking about risk, along with the benefits supply chains, one of associated with the sharing the most frequently of data and intelligence. heard terms today is collaboration. Frankly, the very nature of Indeed, it is a prominent theme global supply chains and the in the 2016 20th Annual Thirdcomplexities that define global Party Logistics Study. supply chains make partnerships Specifically, “This year’s survey and collaboration central to success. suggests 3PLs and their Logistics providers and customers are becoming their customers are more proficient at what acutely aware of this, 2016 they do, individually as evidenced in the well as together, which applications Food is improving the quality Logistics received from of their relationships. the many companies Both parties—93 represented on this percent of 3PL users and year’s annual Top 3PL 94 percent of 3PL providers— & Cold Storage Providers reported that their relationships awards (see Page 34). are successful and that their Collaboration and relationships work is yielding positive results,” are fundamental to our Supply states the executive summary. Chain Network team, which Furthermore, “Gainsharing and includes Food Logistics and its sister collaboration remain important publication, Supply & Demand Chain to many relationships, and 46 Executive. We adhere to a busy travel percent of shippers and 81 schedule because we understand percent of 3PL providers agree the importance of interacting with that collaborating with other others in our industry at trade shows, companies, even competitors, to face-to-face meetings, business achieve logistics cost and service conferences and other events. improvements holds value.” We’re looking forward to Increasingly, logistics providers, spending time with friends and cold storage operators and colleagues during the industry others in the supply chain are shows and conferences coming up actively pursuing relationships in the last quarter of this year. with their customers that are Enjoy the read. more collaborative and not simply transactional. The reasons are myriad, and are fueled by proliferating regulatory compliance pressures and concerns over

TOP

LARA L. SOWINSKI, EDITORIAL DIRECTOR LSOWINSKI@ACBUSINESSMEDIA.COM

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Published by AC BUSINESS MEDIA INC. 201 N. Main Street, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com

WWW.FOODLOGISTICS.COM PRINT AND DIGITAL STAFF Group Publisher Jolene Gulley Associate Publisher Judy Welp Editorial Director Lara L. Sowinski lsowinski@ACBusinessMedia.com Editor Ronnie Garrett rgarrett@ACBusinessMedia.com Managing Editor Elliot Maras emaras@ACBusinessMedia.com Associate Editor Carrie Mantey cmantey@ACBusinessMedia.com Web Editor Eric Sacharski esacharski@ACBusinessMedia.com Senior Production Manager Cindy Rusch crusch@ACBusinessMedia.com Creative Director Kirsten Crock Sr. Audience Development Manager Wendy Chady Audience Development Manager Angela Kelty ADVERTISING SALES (800) 538-5544 Associate Publisher (East Coast) Judy Welp (480) 821-1093 jwelp@ACBusinessMedia.com Sales Manager (Midwest & West Coast) Carrie Konopacki (920) 542-1236 ckonopacki@ACBusinessMedia.com National Automotive Sales Tom Lutzke (630) 484-8040; tlutzke@ACBusinessMedia.com EDITORIAL ADVISORY BOARD Smitha G. Stansbury, partner, FDA & Life Sciences Practice, King & Spalding Raymond J. Segat, director, cargo & business development, Vancouver Airport Authority Dr. Barbara Rasco, professor and interim director, School of Food Science, Washington State University Adriano Melluzo, vice president, national sales, Ryder CIRCULATION & SUBSCRIPTIONS P.O. Box 3605, Northbrook, IL 60065-3605 (877) 201-3915; Fax: (800) 543-5055 Email: circ.FoodLogistics@omeda.com LIST RENTAL Elizabeth Jackson, Merit Direct LLC (847) 492-1350, ext. 18, Fax: (847) 492-0085 Email: ejackson@meritdirect.com REPRINT SERVICES Carrie Konopacki (920) 542-1236 Fax: (920) 542-1133 ckonopacki@ACBusinessMedia.com AC BUSINESS MEDIA INC. Chairman Anil Narang President and CEO Carl Wistreich Executive Vice President Kris Flitcroft CFO JoAnn Breuchel VP of Content Greg Udelhofen VP of Marketing Debbie George Digital Operations Manager Nick Raether Digital Sales Manager Monique Terrazas Published and copyrighted 2016 by AC Business Media Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher.

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SUPPLY SCAN

NEWS FROM ACROSS THE FOOD SUPPLY CHAIN Daily Updates at FoodLogistics.com

FDA FINALIZES FOOD FACILITY REGISTRATION RULE UNDER FSMA The U.S. Food and Drug Administration (FDA) finalized a rule to improve the accuracy of food facility registration as part of the implementation of the Food Safety Modernization Act (FSMA). Facilities that manufacture/ process, pack or hold food for consumption in the United States are required to register with the FDA, and this final rule adds new provisions to the current regulations to codify provisions of the FSMA that were self-implementing and effective upon enactment. Those provisions include the requirement of an email address for registration, required renewal of registration every two years, and that all food facility registrations must contain an assurance that the FDA will be permitted to inspect the facility at the times and in the manner permitted by the Federal Food, Drug and Cosmetic Act. All food facility registrations are required to be submitted to the FDA electronically, although this requirement does not take effect until January 4, 2020. Registrations are now required to contain the type of activity conducted at the facility for each food product category. This was required when the final rule became effective July 14, which is before the October-December 2016 registration renewal period. Finally, beginning October 1, 2020, food facilities will need to provide a unique facility identifier as part of the registration process.

ORACLE TO ACQUIRE NETSUITE Oracle entered into a definitive agreement to acquire NetSuite, the cloud company. The transaction is valued at $109 per share in cash or approximately $9.3 billion. The transaction is expected to close in 2016, and is subject to regulatory approvals and other closing conditions. The closing is subject to a condition that a majority of NetSuite’s outstanding shares not owned by executive officers or directors of NetSuite, or persons affiliated with Larry Ellison, his family members and any affiliated entities, be tendered in the tender offer.

OBAMA SIGNS GMO LABELING LAW President Barack Obama signed S. 764, a law requiring food to carry labels listing genetically modified organisms (GMOs). The law sets in place one national standard for GMO disclosure that brings consistency, certainty, and an end to restrictions on interstate commerce facing retailers, manufacturers and customers. The President’s signing brought accolades from the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA). “I am convinced it will help circumvent further consumer confusion on the already misunderstood and complex topic of GMOs,” said Leslie Sarasin, FMI president and CEO. Food Democracy Now!, an activist group, said it plans to challenge the law. The group said Obama wrote a blank check to Monsanto Company and Big Food while betraying his 2007 promise when running for the White House.

GENERAL MILLS REVAMPS GLOBAL SUPPLY CHAIN, WILL CLOSE PLANTS General Mills Inc. announced restructuring in its global supply chain, impacting its U.S., Brazil and China operations. The company will close a Vineland, New Jersey manufacturing facility and transfer production to other U.S. facilities to eliminate excess soup capacity in its North America supply chain, eliminating 370 jobs. A Martel, Ohio facility will tentatively be sold to The Mennel Milling Co., affecting 180 jobs. General Mills also said it will close or scale back three international plants, which will result in 420 jobs lost in Brazil and 440 jobs in China.

WENDY’S HIT BY MASSIVE CYBER ATTACK, BLAMES MALWARE Wendy’s reported that, in recent months, some of its restaurants were the victim of malicious cyber activity targeting customers’ payment card information. The company is conducting an investigation. Wendy’s first reported unusual payment card activity affecting some restaurants in February. In May, the company confirmed evidence of malware being installed on some restaurants’ point-of-sale systems and worked to disable it. In June, the company discovered additional malicious cyber activity involving other restaurants. That malware was also disabled in all franchisee restaurants where it was discovered. The malware targeted cardholder names, credit or debit card numbers, expiration dates, cardholder verification values and service codes. Wendy’s worked with third-party forensic experts and federal law enforcement on this investigation. The company arranged to offer fraud consultation and identity restoration services to customers who used a payment card at a potentially affected restaurant during the time when the restaurant may have been affected.

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FOOD AND BEVERAGE DISTRIBUTION THRIVES WITH THE RIGHT AUTOMATION.

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SUPPLY SCAN

NEWS FROM ACROSS THE FOOD SUPPLY CHAIN Daily Updates at FoodLogistics.com

CAMPBELL SOUP CO. COMMITS TO ANTIBIOTIC-FREE CHICKEN Campbell Soup Co. plans to use only antibiotic-free chicken in its products, but acknowledged the change won’t come quickly, according to The Courier Post in Cherry Hill, New Jersey. The shift “will be implemented over the next few years,” said the producer, which uses tens of millions of pounds of chicken annually. “We won’t allow antibiotics to be added to the feed, water or any commercial vaccines used by any of our chicken suppliers,” said company spokesman Thomas Hushen. “We’re working with our suppliers to develop a stable, sustainable supply chain.” Campbell President Denise Morrison reported the planned change reflects a real food philosophy at Campbell, which previously vowed to remove artificial colors and flavors from North American products by the end of 2018. The company also backed mandatory national labeling of products that may contain genetically modified organisms.

DANNON COMMITS TO VOLUNTARY GMO LABELING, BUILDS NON-GMO PORTFOLIO Dannon joined the list of food suppliers that will label products that contain genetically modified organisms (GMOs). All Dannon products in the United States that have GMO ingredients will be labeled as such, independent of actions taken (or not) by the federal government. Starting in 2017 and completing the transformation by the end of 2018, Dannon will go a step further to ensure that the cows that supply milk for three brands will be fed non-GMO feed, a first for a leading non-organic yogurt maker. This will involve the conversion of an estimated 80,000 acres of farmland to produce non-GMO crops in order to provide non-GMO feed for the milk used to make Dannon, Oikos and Danimals brand products. New yogurts with non-GMO ingredients are available for the first time from Dannon. The company introduced the first Dannon and Oikos brand products that contain more natural and non-GMO ingredients, a beginning of the transformation of the company’s Danimals, Oikos and Dannon brands, which over time, will evolve to contain non-GMO ingredients to add more choices.

BREWERS TO ADD NUTRITION LABELS TO BEER Anheuser-Busch InBev, Molson Coors Brewing Company, Constellation Brands and Heineken, which produce more than 80 percent of the beer sold in the U.S., will begin providing consumers more nutritional information about their beers, according to CBS News. The Beer Institute, an industry trade group, stated that brewers will disclose calories, carbohydrates, and alcohol content by volume and portion size, both on labels affixed to bottles and cans, and on websites that will be accessible via a quick-response (QR) code. Major beer makers, trying to reverse declining U.S. consumption for years, are also providing dates for when the beer is produced. The Beer Institute’s move, which it hopes will be finished by 2020, got kudos from the Center for Science and the Public Interest (CSPI), a nonprofit that’s often critical of the food industry.

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GMO LABELING BILL CAUSES SPLIT IN THE ORGANIC FOOD INDUSTRY The Organic Seed Growers and Trade Association (OSGATA) withdrew its membership from the Organic Trade Association (OTA) over federal legislation that would require food to carry labels listing genetically modified organisms/ingredients (GMOs). The U.S. Senate and House both passed such legislation recently. The OSGATA claimed its decision was prompted by the OTA’s duplicity toward organic farmers and consumers when a small number of OTA board members endorsed the bill that would pre-empt existing strong state GMO labeling laws that the OSGATA claims are widely supported by the organic community and consumers. The OSGATA claimed the OTA created close partnerships with Monsanto, including lobbying efforts by the biotech-linked lobbyist Podesta Group, on behalf of the bill. The bill’s primary intent is to nullify mandatory GMO labeling laws passed in Vermont, Maine, Connecticut and Alaska legislatures, the OSGATA claims.

UTZ QUALITY FOODS TO ACQUIRE GOLDEN ENTERPRISES INC. Utz Quality Foods, a privately held snack company, agreed to acquire Golden Enterprises Inc., a holding company that owns Golden Flake Snack Foods Inc. Company stockholders will receive $12 per share in cash. This represents a premium of approximately 71 percent over the company’s 30-day average closing trading price of $7. “This merger will allow the Golden Flake brand to continue to grow in our core southeastern markets, while expanding the product selections for our consumers,” said Mark McCutcheon, Utz Quality Foods CEO. www.foodlogistics.com

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DELAYS CHANGE EVERYTHING. That’s why Penske has logistics solutions to help put business problems behind you. Our supply chain services can be tailored to time-sensitive distribution needs. So you can keep moving forward. Visit gopenske.com or call 844-868-0818 to learn more.

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FOOD ON THE MOVE

LOGISTICS TRENDS IN OUR INDUSTRY

SHIPPERS CLAIM CARRIERS AND SERVICE PROVIDERS EXPLOIT SOLAS VGM RULES

Global Shippers Forum (GSF) members, mainly in Asia and Africa, report that some carriers and other service providers are exploiting the new Safety of Life at Sea (SOLAS) verified gross mass (VGM) weighing rules by imposing exorbitant and unjustified charges. The GSF is calling for those charges to be withdrawn. Chris Welsh, secretary general of the GSF, said: “Shippers worldwide support the safety goals of the container weighing requirements and are committed to fulfilling their regulatory requirements, but this should not be used by supply chain partners as an excuse to impose unjustified fees.” He said developing countries pay 40 to 70 percent more on average for the international transport of their imports than developed countries.

TWO WEST COAST PORT TERMINALS TO RAISE MITIGATION FEES

The West Coast Marine Terminal Operator Agreement (WCMTOA) announced a 1.9 percent increase in the traffic mitigation fee (TMF) at the ports of Los Angeles and Long Beach, scheduled to take effect on August 8. The increase will sustain the operation of PierPass OffPeak gates amid labor cost increases. The TMF will rise to $70.49 per 20-foot equivalent unit (TEU) or $140.98 per 40-foot container. The adjustment falls under WCMTOA’s Marine Terminal Schedule No. 1, which states the fee will be adjusted annually to reflect increases in labor costs based on Pacific Maritime Association labor cost figures. PierPass launched the OffPeak program in 2005 to reduce cargo-related congestion on roads around the Los Angeles and Long Beach ports. OffPeak established night and Saturday work shifts for trucks delivering and picking up containers at the 13 container terminals in the two adjacent ports.

EXPANDED PANAMA CANAL SMASHES TOLL RECORD

A cargo ship paid a record $829,468 toll with the opening of the expanded Panama Canal in June, according to gCaptain.com. The toll was paid by the Mitsui O.S.K. Lines (MOL)-operated MOL Benefactor for a northbound transit of the canal on July 1, the Panama Canal Authority noted. The previous toll record was paid by the COSCO Shipping Panama for its inaugural transit of expanded locks to the tune of $575,545. The 10,000 20-foot equivalent unit (TEU) MOL Benefactor was the first neo-Panamax containership to use the new locks since commercial operations began on June 27.

SYSCO ACQUIRES E-COMMERCE PLATFORM FOR RESTAURANT SUPPLIES AND EQUIPMENT

Sysco Corp. acquired Supplies on the Fly, an e-commerce platform providing restaurant supplies and equipment exclusively to Sysco customers. The price of the acquisition was not disclosed. Based in Kennesaw, Georgia, Supplies on the Fly allows Sysco customers to place orders for more than 170,000 products online or by telephone via an e-commerce platform that is fully integrated with Sysco’s business information systems. In 2009, Sysco entered into an agreement with Instawares Holding Company LLC, the owner of Supplies on the Fly, to develop www.suppliesonthefly.com. Sysco secured an option to purchase all of the equity interests of Supplies on the Fly.

U.S. DOT PROPOSES FLIGHTS TO CUBA FOR EIGHT U.S. AIRLINES

The U.S. Department of Transportation (DOT) proposed eight U.S. airlines to begin scheduled flights, as early as the third quarter of 2016, between Havana, Cuba and the following U.S. cities: Atlanta, Charlotte, Fort Lauderdale, Houston, Los Angeles, Miami, Newark, New York City, Orlando and Tampa, according to Air Cargo World. The airlines are Alaska Airlines, American Airlines, Delta Air Lines, Frontier Airlines, JetBlue Airways, Southwest Airlines, Spirit Airlines and United Airlines. The news comes months after the U.S. Airforwarders Association (AFA) urged the DOT to assign routes to U.S. airlines that also offer cargo services. In February, the U.S. and Cuba signed a memorandum of understanding to re-establish a broad spectrum of services between the two countries that were terminated for more than 50 years.

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FOOD ON THE MOVE

LOGISTICS TRENDS IN OUR INDUSTRY

USDA TO TEST ONLINE GROCERY DELIVERY TO FOOD STAMP RECIPIENTS

The U.S. Department of Agriculture (USDA) plans to test online delivery of food stamp grocery purchases, although the program could raise fraud concerns, according to Fox News. A USDA spokesperson said the agency will be seeking volunteers for the pilot program in the fall. The spokesperson said “getting the proper technology in place to ensure process integrity” was a major factor, as few companies developed the correct encrypted PIN capabilities. The Washington Post reported that online delivery services like Peapod, FreshDirect and Thrive Market are supporting the push. If the USDA determines the pilot program is successful, it will deploy it nationwide.

AFN ACQUIRES HA ADVANTAGE TO STRENGTHEN ITS LESS-THANTRUCKLOAD OFFERING

AFN LLC, which provides customized supply chain solutions to manufacturers, retailers and carriers in the United States, acquired HA Advantage, the transportation management system (TMS) and less-than-truckload (LTL) division of HA Logistics. The move will enhance AFN’s holistic product offerings. The proprietary TMS developed by HA Advantage is a scalable, web-based, mobile-optimized solution designed to enable smarter and faster transportation decisions.

7-ELEVEN MAKES FIRST DRONE FOOD DELIVERY IN RENO

7-Eleven partnered with a tech startup called Flirtey to make its first drone delivery to a customer’s home in Reno, Nevada, according to Blasting News, an online social journalism website. Through the use of precision GPS, the items delivered included: Slurpee drinks, donuts, coffee, candy and a sandwich. The Flirtey drone successfully lowered each food package into the family’s backyard within a few minutes of the delivery. Already delivering food items through services such as those offered by Postmates and Tapingo, 7-Eleven stated that it intends to launch a delivery service powered by drones some time in the future. The 7-Eleven drone delivery preempts Amazon’s stated intention to be the first company to offer delivery services through drones.

MATSON LOGISTICS TO ACQUIRE SPAN ALASKA TRANSPORTATION

Matson Logistics will acquire all of the equity of Span Alaska Transportation for a cash purchase price of $197.6 million. The transaction is expected to be treated as an asset purchase agreement for federal tax purposes, which will allow for a step up in the tax basis of the assets, producing an anticipated $35 million net present value benefit to Matson. Matson expects to fund the transaction from available borrowings under its revolving credit facility and the transaction is expected to close in the third quarter of 2016, subject to the Hart-Scott-Rodino waiting period and other customary closing conditions. Matson also expects to issue $200 million of 15-year senior unsecured notes at a fixed interest rate of 3.14 percent within the next 60 days. Proceeds are expected to be used to pay down the company’s revolving credit facility and for general corporate purposes.

DAT SOLUTIONS’ MONTHLY FREIGHT REPORT

The High Cost of Truck Detention Hammers the Freight Industry Mark Montague is an industry rate analyst for DAT Solutions, which operates the DAT network of load boards and the RateView rate analysis tool. He has applied his expertise to logistics, rates and routing for more than 30 years. Montague is based in Portland, Oregon. For more information, please visit www.dat.com.

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If there’s one area in which carriers, freight brokers and shippers can agree, it’s that more productivity is good for business. Unfortunately, the loading dock—where shippers and carriers literally come together—is where so much productivity gets lost. DAT Solutions surveyed 257 carriers, and nearly 63 percent said their truck drivers spend more than three hours at docks waiting for their vehicle to be loaded and unloaded. Roughly 54 percent reported typical waits of three to four hours, while 9 percent said five hours or more was common. Lost productivity is a big issue when you’re paid by the mile and need to keep the wheels turning. In fact, 84 percent of

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motor carriers said detention is one of the top five business problems they face. By contrast, among the 50 freight brokers who responded to the survey, only 20 percent agreed that detention is one of their top five problems. Both brokers and carriers defined detention as holding a driver and truck at the dock for more than two hours while loading or unloading. Most carriers said they are seldom paid for detention, and when payment is offered, only 3 percent of

By Mark Montague

carriers said they were paid on 90 percent or more of their claims. The average rate was between $30 and $50 per hour, a level of compensation that did not cover the opportunity costs to their business. Furthermore, carriers said they turned down other loads while their trucks were detained. Driver detention costs the trucking industry as much as $4 billion a year in lost productivity. The Federal Motor Carrier Safety Administration is preparing an audit to measure its potential effects on truck driver fatigue and crash risks as it lays the groundwork for new regulations on shippers and receivers. www.foodlogistics.com

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COOL INSIGHTS

BY SUDARSAN THATTAI

HOW TECHNOLOGY INNOVATION TRANSFORMS THE COLD CHAIN

T Thattai

Sudarsan Thattai is CIO of Lineage Logistics. He has more than 17 years of experience leading technology operations and initiatives across large-scale organizations like UTi Worldwide, Cisco Systems and DFS Group.

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ake a moment to observe the number of gadgets, screens and devices that are in your immediate line of sight. If it wasn’t obvious before, it is undoubtedly clear to you now that our lives are being slowly taken over by technology. Over the last few decades, innovators and disruptors alike have employed technology to reimagine daily life—the way we work, the way we raise our families, even the way we eat is ever-impacted by the evolution of and accessibility to the latest advancements in technology. Transactions have never been easier; access to information has never been faster; and the efficiency and sheer convenience technology continues to introduce to our world cannot be understated.

inform solutions to its customers’ most challenging logistics needs. As an example, the Lineage Logistics facility in Santa Maria, California, deploys hundreds of temperature sensors in its receiving, storage and shipping areas to provide constant visibility into the operations of the refrigerated systems and to help maintain quality control. From the data collected via these sensors, managers are able to make adjustments to the system to minimize temperature variability, protecting customers’ product and decreasing energy bills. In addition, the system can predict when maintenance of the systems are required and avoid costly shutdowns.

Technology’s Challenge

The consolidation of the cold chain logistics industry during the last decade has also resulted in great opportunities for companies to optimize the performance of their customers’ supply chains. For instance, the increased scale of newly combined companies improves routing solutions for both inbound and outbound transport, dramatically reducing empty trailer miles and yielding other benefits. Lineage, for instance, can tap its larger network of facilities to more accurately match backhauls and fronthauls to make the supply chain more efficient and environmentally sustainable. This system can extend to match the shipping profiles of customers’ trading partners, adding channels to ensure that as many trailers as possible are traveling full to improve profits and reduce waste.

It goes without saying, technology’s influence on the cold chain logistics industry is equally profound. From the implementation of temperature monitoring to the optimization of product put-away and selection, technology has and always will be an industry game-changer. The challenge cold chain logistics providers face is leveraging that technology to bring efficiency and optimization opportunities to their customers’ businesses. Lineage Logistics constantly looks for ways to utilize technology and other optimization strategies to deliver value along its customers’ extended supply chains. Across its facility network, critical technologies and systems like sensors and automation help it to gather and analyze critical data that

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Inbound and Outbound Opportunities

In addition, because retailers and suppliers want product delivered in tighter time windows, but also want to reduce out-of-stocks and limit excess stock at the store, cold chain logistics companies need better visibility into product movement. Deployment of technologies that can track and trace product from pasture to plate gives logistics providers the capability to support complex and changing supply chains.

Efficiency Impacts Quality Lastly, automation has the potential to significantly increase capacity and reduce energy consumption at cold chain distribution facilities. Such product handling and related technologies can also improve food quality and product consistency by optimizing the handling of goods in harsh environments like extreme cold. Automation helps distributors increase throughput, decrease scheduling errors, and lower labor and energy costs. Other benefits include better productivity, a critical value-add when there is a labor shortage, and more flexible methods of product handling on the same line. This industry is dynamic and the impact of technology on the cold chain continues to unfold. While it is often challenging to keep up with the revolving door of technological advancements, the benefit that the ubiquity of technology provides is clear—in many ways, technology and other optimization methodologies help foster a less tactical, more strategic partnership between cold chain providers and their customers.

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©2015 Carrier Corporation.

, E C N A M R O F R E TR U E P . E V O L TR U ©2016 Carrier Corporation

rt ™ Tra n s p o e V e c to r h T y . le b a p p o rt u n it t. R e li g e n u in e o l e ff ic ie n a e u is F g t. n h ri ee h tw e ig a le r ti v e e n g in Q u ie t. L ig s ic o ld d e U ) in n o v a R (T ’s it rr ie r Tra n n a U C n r o u ti o y ra A sk ance. R e fr ig e f p e rf o rm s s b e tt e r. o e d in n s u ra b b r c to r e you it h th e V e to m a n a g in lo v e w g in ll fa a re w h y fl e e ts

www.carrier.com /ecoforward www.foodlogistics.com

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COVER STORY COLD CHAIN INTEGRITY

ARE YOU READY FOR THE

BY ELLIOT MARAS

FSMA?

The Food and Drug Administration takes a non-prescriptive approach to improving food safety.

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T

he balancing act between the expansion of the cold chain (with its inherent vulnerabilities) and the industry’s commitment to better safety (aided by an array of new tools) continues. One sign of progress in this shaky balancing act is the finalization of the U.S. Food and Drug Administration’s (FDA’s) Food Safety Modernization Act (FSMA). Compliance dates for the rules vary, with enforcement for at least one of the rules starting as early as September. The FSMA provides all players in the cold chain—growers, processors, distributors, retailers and transporters—more definitive roadmap to improve the safety of the food supply. While many players already deployed safe practices that exceed FSMA standards, the law gives the FDA new enforcement powers that can encourage better practices to improve food safety. Earlier this year, the FDA finalized the last of the FSMA’s seven rules— the intentional adulteration rule. The intentional adulteration rule complements the preventive controls rules for human food and animal food, the produce safety rule, the foreign supplier verification program rule, the accreditation of third-party auditors rule, and the sanitary transportation of human and animal food rule.

These seven rules are designed to strengthen the food safety system. The rules have varying compliance dates, depending, in part, upon the size of the covered business. The preventive controls rule for human food became final September 17, 2015, with a compliance date for certain provisions starting as early as September19, 2016, for large businesses. The sanitary transport rule was published in April and enforcement for large businesses begins in April 2017. The FDA has an educational outreach initiative, in addition to educational efforts from trade organizations and private efforts.

The FSMA Borrows from HACCP Some FSMA requirements are similar to longstanding practices, such as the FDA’s Hazard Analysis and Critical Control Point (HACCP) protocols. In formulating the final rules, the FDA incorporated certain HACCP-like elements—such as implementation of prerequisite programs, good manufacturing practices, and analysis of potential problems and documentation— and shifted control measures to preventive measures. The aspects of the law that are expected to have the most impact on supply chain service providers are the preventive controls and sanitary transportation rules. The preventive

controls rule applies to companies involved in cold storage (in addition to manufacturing), while sanitary transport impacts companies involved in arranging shipping, loading, carrying and receiving food transported by truck and rail. A survey of food industry companies on FSMA readiness indicated the preventive controls for human food requirements will have the most impact on their operations. Eighty-five percent of respondents, which included manufacturers, distributors, processors, retailers, transporters and brokers, said this rule will apply to them. (See “Most Companies Unsure of How to Meet FSMA Rules” on Page 22.) “Some of our refrigerated warehouse members, at a very minimum, will be a receiver under the [sanitary transportation] rule,” says Lowell Randel, vice president of government and legal affairs at the Global Cold Chain Alliance (GCCA). “Many of those warehouse members also will be loaders. And while not owning the product, warehouses often will be arranging for the transportation and that’s an important distinction. The rule very clearly indicates that third-party entities, brokers and warehouses could very likely be shippers for the purposes of the rule, which means they will have this long list of responsibilities.” “They may not see themselves as the shipper, but the rule will designate them as the shipper if they’re the ones who are arranging for a carrier to come in and pick up a load,” he says.

They may not see themselves as the shipper,

but the rule will designate them as the shipper.” Lowell Randel, Global Cold Chain Alliance

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the practices in a warehouse? Probably not,” Randel says of the temperature control requirement. “But it’s definitely going to be a lot of recordkeeping and documentation to demonstrate to the agency, ‘here is how we are maintaining temperature.’” Companies not subject to modified requirements face a more detailed process. “That’s going to be very much like a HACCP plan, although it’s not called a HACCP plan,” Randel says. A company has to have control points for preventing possible hazards and a plan for how they will be addressed. The company has to keep extensive records and have qualified individuals on staff to oversee the plan. “The biggest part companies will have to implement, if they have not already, is the preventive controls,” agrees Eric Wolf, food safety and quality assurance manager at Preferred Freezer Services, a cold storage operator. The biggest challenge for many companies under the preventive controls rule will be the need to conduct risk assessments and implement hazard controls, similar to HACCP, Wolf says.

COVER STORY continued

Most Extensive Rule: Preventive Controls

Registered food facilities will need qualified individuals on staff to oversee the food safety plan under the FSMA.

The most extensive rule is the preventive controls for human food, according to Randel. Companies registered as a food facility with the FDA must have a food safety plan in place unless they receive an exemption or fall under a modified requirement. The modified requirement applies when the facility is exclusively engaged in the storage of packaged product. In such cases, the law focuses on temperature control. The company needs a formal plan for maintaining correct temperatures, corrective actions and verification procedures. “Is it going to change a lot about

Sanitary Transport: Changes Coming For Preferred Freezer Services, the biggest change under the FSMA was to formalize its transportation procedures to comply with the sanitary transport rule. All 35 of its company warehouses are HACCP-compliant and have robust compliance training programs, he says. Preferred Freezer Services built

strong foundations for both preventive controls and transportation requirements through its British Retail Consortium (BRC) certification and compliance efforts, Wolf says. He is confident the company can meet FSMA requirements. Billy Adams, director of food safety at Americold, agrees that preventive controls is the most important aspect of the law for cold chain storage. But sanitary transport is the rule that Americold is reviewing more carefully. “I do think that it will be somewhat of a challenge for the industry just because it’s so new, so different. The FDA wasn’t intricately involved in invoking regulations around transportation. Now the [FDA] put some very specific expectations around responsibilities of the shippers, of the carriers and of the receivers. In a company such as ours, we actually play all three of those roles in some of our facilities.” “We’re shipping product out on behalf of our customers, whether or not we’re the shipper of record,” he says.

A More Flexible Approach Under the sanitary transport rule, the FDA removed prescriptive requirements for temperature monitoring devices and continuous monitoring during transport. The agency replaced these provisions with a more flexible approach that allows the shipper and carrier to agree to a temperature monitoring mechanism for shipping food. The rule places the responsibility for determinations about transportation operations (e.g., whether food

RANKING OF EXTERNAL COMPANY CONCERNS TOP EXTERNAL CONCERNS—ALL COMPANIES

Food safety, traceability and quality assurance

4.9

New government regulations related to the FSMA

4.34

Ability to develop new products and services

4.09

Food marketing and advertising effectiveness

3.99

Rising commodity and other costs

3.90

Falling commodity and other costs

3.36

Delays at ports

2.83

Currency fluctuation

2.59

Acquisitions

2.09 0

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Most concern

Food safety tops all concerns, according to a survey of food decision-makers by WeiserMazars LLP. 1

2

3

4

Least concern

5 www.foodlogistics.com

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M MOST COMPANIES UNSURE OF HOW TO MEET FSMA RULES

ost food companies have or are considering systems to meet Food Safety Modernization Act (FSMA) regulations, APPLIES DOES UNSURE but most do not have confidence that the NOT IF APPLY APPLIES systems will actually meet requirements, according to an FSMA readiness survey by The Preventive Acheson Group and SafetyChain Software. The Controls for 85% 11% 4% survey queried manufacturers, distributors, proHuman Food cessors, retailers, transporters and brokers on their Preventive FSMA readiness. Controls for 30% 63% 7% Three out of four respondents said their compaAnimal Food nies were not completely ready for FSMA compliance, even though large companies must comply Produce Safety 34% 59% 7% with certain requirements by mid-September. Foreign Supplier The survey indicated that: more informaVerification 54% 33% 13% tion is needed on meeting FSMA requirePrograms ments; companies need to understand how Sanitary systems meet the requirements; companies 68% 16% 16% Transportation need to know what resources are available to meet FSMA requirements; and upper Accredited management needs to be more Third-Party 65% 19% 16% involved in the compliance Certification process. Food Defense 83% 5% 12% Among the FSMA’s seven rules, the preventive Source: The Acheson Group and SafetyChain Software Paper controls for human food rule was cited by the vast majority (85 percent) of companies as applying to their business. All companies indicated there would be some difficulty in complying with the FSMA. Only a minority of companies have plans in place for the following areas: document management (34 percent), audit management (30 percent), supplier compliance (27 percent), Both paper food safety program management (34 percent), laboratory information and electronic management (19 percent) and the Global Food Safety Initiative (GFSI) automation system (10 percent). Most large companies indicated Yes, programs they are relying on hazard analyses to are updated prepare for the law. Most of these comNo current panies said they are not using outside plans to update sources to conduct their hazard analyses. programs Only 10 percent of respondents indicated their food safety plans are fully updated. The majority of respondents said they keep both paper and electronic records, Currently and have confidence in the accuracy, updating Plan to accessibility and functionality of those programs update records. The majority also said they are programs confident they can produce the records in 2016 within 24 hours for audits. More than half of respondents were unsure if Source: The Acheson Group they will need more staffing or technology to and SafetyChain Software comply with the FSMA. However, three quarters Plan to said they will not use outside resources to comply. update These split statistics may indicate that companies programs need more guidance about the regulations, including in 2017 information about available resources.

ARE YOU KEEPING PAPER OR ELECTRONIC RECORDS? Electronic

3%

14%

83%

Source: The Acheson Group and SafetyChain Software

10%

6%

HAVE YOU UPDATED YOUR CURRENT FOOD SAFETY PROGRAM(S) TO MEET FSMA REQUIREMENTS?

33%

47%

4%

COVER STORY continued needs temperature control for safety, the relevant operating temperature and mode of temperature monitoring, whether particular clean-out procedures are needed and whether previous cargo must be identified) on the shipper.

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The shipper can rely on contractual agreements to assign some responsibilities to other parties, such as a loader or carrier. “We believe the shipper is in the best position of the parties covered by this rule to know the appropriate specifications for transport of its food,” the rule states.

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More Training Required Dr. John Ryan, a food safety consultant who operates under the name Sanitary Cold Chain, says the sanitary transport rule requires training for all carrier personnel engaged in food transportation. Personnel must be trained in awareness of potential food safety problems that may occur during transportation and in basic sanitary practices to address potential problems. The carrier is responsible for all functions assigned if they are performed by other persons, such as a driver that is employed or contracted by a trucking firm, Ryan says. A carrier also can be a receiver or a shipper if the person also performs the functions of those respective persons. Americold monitors the temperature of product upon delivery to and before departure from its facilities or vehicles, but it can also monitor temperatures during transit if required by customers, Americold’s Adams notes. The method it uses depends on what the

customer wants, which is what the sanitary transport rule requires. In some cases, the company monitors the temperature using electronic temperature loggers. In other cases, customers supply the loggers and Americold monitors them on their behalf. “That is something that could become more of a standard in the industry than it is today,” he says. Adams doesn’t expect real-time temperature monitoring to become standard practice just yet due to the complexities of mobile communications for temperature loggers. He agrees with those who say companies correctly using the HACCP will most likely be in compliance with the FSMA. Under the FSMA, companies may need to change some of the language in their safety plans. “For example, in the past, you might have had an allergen management program; now, you may have to say, ‘I have a preventive measure to prevent allergen cross-contact. That is my allergen management program,’” Adams says. “You have to make sure you read through the

entire preventive controls rule.” The intentional adulteration rule may also impact storage companies, Adams says. The rule requires food facilities to conduct vulnerability assessments and establish mitigation strategies for those areas of the facility susceptible to attack. J. Kings Food Service Professionals Inc., a full-line foodservice distributor, always maintained a food safety plan designed to exceed existing regulations, says Kevin Peterson, executive vice president of operations. “While the additional FSMA regulations increase the need for staff training, recordkeeping and temperature monitoring, the majority of the requirements were already in place at the company,” he says.

Recordkeeping requirements extend under the FSMA.

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For more information, visit odfl.com or call 1-800-235-5569. Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identified herein are the intellectual property of their respective owners. © 2016 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

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COVER STORY continued

Greg Shields, transportation manager at Dietz & Watson, a manufacturer of delicatessen food, thinks the sanitary transport rule will require more extensive recordkeeping. He believes the real-time visibility of assets and temperature control systems will enable his company to meet the requirements. One area that Dietz & Watson is trying to get a better handle on is how well the carriers it uses in outlying markets will meet the sanitary transport rule.

Drivers Must Be Ready “Changes in driver training and the documentation of that training are the biggest changes for the industry,” says Todd Holt, president of transportation at NFI Industries, a global 3PL. “All drivers must be trained in the correct sanitation methods to ensure that every load moves safely and without the fear of cross-contamination. That training must be documented and the records

The FSMA law is flexible in that it does not specify how temperature is to be monitored.

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maintained. Non-driving associates also will be trained to ensure that proper documentation occurs.” “We also put in place the needed information technology infrastructure to ensure all records are maintained, stored and available as required,” he adds. “There’s nothing in it that’s onerous; it should make the industry better,” says Ken Lund, vice president of operations at Allen Lund Company, a transportation broker. He notes that the sanitary transport rule requires carriers to use clean equipment, but it does not specify what equipment and what sanitation processes. “The rules couldn’t anticipate all of the different scenarios,” he says. “What they said is you have to provide a clean trailer.” How recently a trailer has to be washed will depend on what product it was carrying and what product it will be carrying.

Better Communication Expected Lund says this non-prescriptive approach is good for the cold chain. “It does push communication,” he says. The law does not require temperature monitoring of produce, for example. But companies that have temperature monitoring have to keep records of it. Lund thinks produce transporters that follow the best practices provided by the North American Produce Transportation Working Group, which the May issue of Food Logistics examined in detail, will most likely be in compliance

with the sanitary transport rule. “All the better companies already do a pretty good job of that,” he says.

More Recordkeeping Records of what communication takes place between a shipper and a carrier concerning instructions on temperature and sanitation need to be available, says Ray Zujus, business development director for food and beverage at Telogis Inc., a mobile enterprise management software provider. Carriers need to keep records of vehicle performance, maintenance, location and how the vehicle is being driven. “This is a key part of an overall connected, vehicle-workforce-work strategy that ultimately drives safety, productivity, and efficiency in food and beverage fleets,” he says. The sanitary transport rule is the only FSMA rule that specifically targets transportation providers, but some of the other rules refer to the need to document transportation practices. Hence, shippers and receivers could be asking carriers to provide information to comply with FSMA rules beyond the sanitary transport rule. Leonard (Bud) Rodowick, manager of strategic relations for food safety and OEMs at Thermo King Corporation, believes carriers should have a thorough knowledge of the preventive controls and intentional adulteration rules. The preventive controls rule requires a registered food facility to consider the effect of several elements on food safety, one being transportation and another being distribution. “[The food safety plan] needs to address transportation and distribution operations,” Rodowick notes. “It is due September 19.” The rule also requires such facilities to communicate the need for appropriate temperature control to the person transporting the food. A shipper could expect a carrier to assume more of the responsibility for the condition of the product in transit, Rodowick says. “You as a carrier need to be having a conversation with your shipper,” he says.

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Requirements Are Entity-Specific “The requirements of the various FSMA rules apply to specific entities,” says Smitha Stansbury, a partner in the FDA and life sciences practice at the King & Spalding law firm. “The rule on foreign supplier verification programs applies to importers of human and animal food. The sanitary transportation rule applies to certain shippers, receivers, carriers and loaders. The preventive controls and hazard analysis requirements apply to registered food facilities.” Some observers, nevertheless, have some concerns about the law’s effectiveness. Rodowick is concerned about independent truckers that are not required to follow the FSMA. Companies with less than $500,000 in annual sales are exempt. According to trucking industry statistics, that’s the majority of the trucking industry. “If the industry generally outsources some portion of its business as a normal business practice, how does the industry deal with the

shippers’ written procedures on equipment, appropriate sanitation and all of the written transportation operations requirements to these outsourced partners?” asks Don Durm, vice president of customer solutions at PLM Trailer Leasing. “I am sure that not all of these partners are large trucking companies and this may be difficult for companies that outsource a high percentage of their loads to deal with.” Durm asks how a shipper that creates the operational requirements for a carrier will be able to transfer those requirements to a third party. “Will the carrier, once it arranges for a load with a third-party partner, now become the shipper? What are the transparency requirements to the original shipper as to knowledge of the third-party carrier used?” The documentation will be a key focus for the FDA, Durm notes. “If the carrier now becomes the shipper, it will have to be aware that merely by transferring the previous shippers’ written requirements

may not protect it from possible litigation/prosecution if the food should become unsafe during the new carrier transport,” he says. The shipper will need to provide the carrier in writing all of the requirements to protect food from becoming unsafe. This will require a full understanding of the food product temperature tolerances and conditions that would render the food transported unsafe. “How will these carriers that source third parties that may now become the shipper ensure that all of their documentation requirements are backed up with the science?” he asks. As the food industry works toward meeting the new regulatory requirements, efforts are underway by associations and other groups to develop resources to help companies with compliance. The International Refrigerated Transportation Association (IRTA), a core partner of the GCCA, is scheduled to release a best practices guide to help industry comply with the sanitary transport rule in early August.

Will the carrier, once it arranges for a load with a third-party partner, now

become the shipper?” Don Durm, PLM Trailer Leasing

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For more information, visit odfl.com or call 1-866-637-7333. Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identified herein are the intellectual property of their respective owners. © 2016 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

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SECTOR REPORTS

3PLS: Refrigerated Service BY MINDY LONG

FOODSERVICE INDUSTRY PREPARES FOR

BIG CHALLENGES ON MANY FRONTS Food safety laws, labor regulations and new consumer demands call for action.

T

he foodservice industry has dealt with a number of regulatory issues over the past year, including those related to food safety and labor, while also addressing the changing consumer, the driver shortage and regulations on the horizon. Overall, those within the industry say operators are well prepared to take on the challenges and position themselves for success. “It continues to be a more challenging environment than we’d like, but we’re making improvements on several key issues,” says Mark Allen, president and CEO of the International Foodservice Distributors Association (IFDA).

Food Safety

 Certain food facilities must have a food safety plan under the FSMA.

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For several years, the industry has been complying with and preparing for regulations contained in the Food Safety Modernization Act (FSMA). “One of the things we’ve been most pleased about is the rules really focus on the risk and alleviating the risk,” Allen says, adding that the flexibility the rule provides allows operators to focus on the areas most at risk within their organizations rather than taking a blanket approach for the entire industry. For example, the rule does not require temperature records for every shipment, but instead, focuses on the process used to maintain temperature integrity, Allen says. Working on the rule with the U.S. Food and Drug Administration (FDA) has been a positive process, Allen notes. “The proposal had some significant issues and we worked closely

with the FDA, and we were pleased with how the rules turned out,” Allen says. “The FDA acknowledged that transportation has not seen tremendous issues on food safety.” Joe Tracy, president of Dot Foods, says the company has been preparing for the FSMA for years and is ready to comply. However, he says, “I think the impact on medium to large distributors was not that significant.” Dot Foods has also implemented some requirements ahead of schedule. “There is a precooling requirement that goes into place spring of next year. We went ahead and implemented it in January of this year,” Tracy says. “We had some customers who were requiring it anyway, so we went ahead and did it for all.”

Labor Concerns IFDA’s Allen says the industry has faced a tougher environment on the labor front. In May, the U.S. Department of Labor finalized new rules governing which employees are eligible for overtime pay. The agency doubled the minimum salary threshold that employees must earn in order to be exempt from overtime pay, increasing the figure to $47,476 per year from the previous salary of $23,660. The increase may create challenges for the quick service food industry, especially in rural parts of the country. Distributors have jobs that may get caught up in it as well, primarily some of the entry-level exempt positions, Allen explains. The IFDA is also seeing a number of states establish minimum wages www.foodlogistics.com

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higher than the federal minimum wage rate of $7.25 per hour. “It is $15 in New York state, and we’re seeing it in Seattle and California. We’re also seeing changes to the laws around unionization, making it far easier for unions to be organized,” Allen says. “We believe those goal posts have been moved significantly.” As labor costs increase, companies must work to reduce labor expenses to keep their prices unchanged, explains Allen. “To do so, they will likely embrace automation or increase the number of part-time employees. In the end, our concern is that all of these things that were designed to help employees will miss the mark.” Labor concerns also extend to professional drivers and the driver shortage continues to be a challenge. The average salary for a professional driver in the foodservice industry is $63,000 and most drivers are home every night, adds Jon Eisen, senior vice president of government relations for IFDA. Meanwhile, to help attract drivers, Dot Foods created unique sched-

ules, such as four days on and three days off, and is upgrading its drivers’ lounges. “We just opened up a $1.1 million driver lounge that has beautiful rooms, lockers, an outdoor patio and full kitchen,” Tracy says. “We have to compete more effectively with other alternatives.” Dot Foods also started a unique program in Indiana in which the company pays drivers to obtain their commercial drivers’ licenses. Warehouse labor is also becoming an issue as mature workers seek less physical work and fewer younger workers enter the field. In response, Dot Foods is offering more alternative schedules.

New Labeling Rules President Obama recently signed a federal law setting in place one national standard for genetically modified organism (GMO) disclosure that brings consistency, certainty, and an end to restrictions on interstate commerce facing retailers, manufacturers and customers. (See “Obama Signs GMO Labeling Law, Drawing Mixed Reactions” on Page 28). This is good news for manufacturers that would otherwise have to figure out how to comply with state laws. Vermont already passed a law that was scheduled to take effect in 2017. “It is very difficult to have products labeled one way to go to one state,” Tracy says.

 Some food transportation companies are adjusting driver schedules to improve job satisfaction.

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For more information, visit odfl.com or call 1-800-432-6335. Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identified herein are the intellectual property of their respective owners. © 2016 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

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8/4/16 1:37 PM


SR: 3PLS: REFRIGERATED SERVICE continued

New Consumer Needs

We’re spending more of our time trying to educate

customers about online threats.” Joe Tracy, Dot Foods

Mindy Long is a writer specializing in transportation and logistics. She has been writing professionally for more than 15 years.

As the consumer evolves, the foodservice industry continues to change as well. “There is a demand for local and healthier products. Distributors have to be prepared to meet the consumers’ needs and the needs of the customer,” Allen points out, adding that distributors have had to gain expertise in the local food movement, for instance. Food safety is of “paramount importance, particularly when working with a local farm,” Allen says. To ensure quality, a growing number of distributors are going to local farms to validate the processes to verify they’re working with a reputable business. Tracy says he sees an increase in demand for healthy foods, with a growing number of millennials seeking GMOand gluten-free options. In response, Dot Foods is allocating resources to expand its healthy offerings and bringing in small, niche suppliers to meet the need. “We’ve expanded our offering pretty heavily,” he notes, adding that it changed the way the company configures its warehouse. To give customers a competitive advantage, Dot Foods invested in technology that allows its customers to gain improved access to the products within its warehouse. “We sell our customers on not just selling the offerings in their warehouse, but for our offerings to be their offerings”as well, Tracy explains. Consumers’ buying habits are changing, with more shoppers going online for products, which could take a bite out of the

OBAMA SIGNS GMO LABELING LAW,

DRAWING MIXED REACTIONS President Barack Obama recently signed S. 764 into law, setting in place one national standard for genetically modified organism (GMO) disclosure that brings consistency, certainty, and an end to restrictions on interstate commerce facing retailers, manufacturers and customers. While the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA) applauded the signing, an activist group, Food Democracy Now!, said it will challenge the law. “I am convinced it will help circumvent further consumer confusion on the already misunderstood and complex topic of GMOs,” says Leslie Sarasin, FMI president and CEO. “In addition to the President’s role in signing it into law, we are most appreciative of the part U.S. Department of Agriculture (USDA) Secretary Tom Vilsack and his team played during critical times in the legislative history of this law and will now play in implementation.” “This legislation will open a new era for transparency in ingredient information for consumers by requiring

disclosure of genetically engineered ingredients for families in every state across the nation,” says Pamela G. Bailey, GMA president and CEO. “A consistent national standard is far better than a costly and confusing patchwork of different state labeling. The President’s signing of this legislation also stops, effective immediately, Vermont’s mandatory on-package labeling law that went into effect July 1, and already left consumers in the state with fewer products on the shelves and higher compliance costs for small businesses.” Food Democracy Now! says Obama wrote a blank check to Monsanto and Big Food, while betraying his 2007 promise when running for the White House. Attorneys for the organization will be mounting a legal challenge for what it calls the law’s numerous legal problems, including its infringement on the 14th Amendment of the Constitution that guarantees equal protection for all. The unenforceable labeling system the law mandates is defined by quick-response (QR) codes, a 1-800 number and smartphone access. The discriminatory nature of the bill will deny the elderly, poor, many minorities, rural Americans and even some religious groups access to basic information about their food, leaving behind nearly a third of all Americans that do not own or can’t afford or choose not to use this modern technology, the organization notes.

foodservice industry’s margins. “We’re spending more of our time trying to educate our customers about online threats. Amazon and others are going to take the highest slice of margin from foodservice distributors. We’re trying to help them get that back by helping them say yes more often than not to their customers,” Tracy says.

will be full of the latest and greatest technologies to help drive cost out of the system to make operators more efficient and safer. The conference will also cover the nuts and bolts of the foodservice industry, such as better managing inventory, keeping damages down and utilizing technology to reduce operating costs. The IFDA created learning opportunities to help front-line supervisors grow professionally and personally. The IFDA also established a leadership development program with the University of Virginia Darden School of Business.

The IFDA Annual Conference The IFDA is preparing for its annual Distribution Solutions Conference in October, and the organization’s Jon Eisen says the expo hall

28

FOOD LOGISTICS | AUGUST 2016

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8/4/16 1:37 PM


SPECIAL REPORT SOLAS

BY ELLIOT MARAS

SOLAS OCEAN CONTAINER WEIGHT RULE TAKES EFFECT F

A new safety requirement pushes the maritime industry to better organize its information management.

Terminal operators and carriers need processes for handling packed containers presented for loading without a verified gross weight.

30

ood and beverage shippers involved in export trade are required to provide verified container weight information under an International Maritime Organization (IMO) rule that took effect July 1. The full impact of the rule, known as the International Convention for the Safety of Life at Sea (SOLAS), was uncertain at the time of this report, as the U.S. maritime industry continues to work on a system to meet the requirements. The IMO amended its regulations to require that a container’s gross weight be verified before being loading onto a ship. The IMO previously

required shippers to provide gross cargo mass on containers. The IMO enacted the revision to address concerns about the safety of containers with inaccurate declared weights. The amendment places the responsibility for providing a verified container weight on the shipper.

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Shippers are not only responsible for reporting the normal gross cargo weight, but also for certifying the verified gross mass (VGM) of each container. This includes the container weight provided by the carrier before the cargo is loaded onto the ship. The rule allows two methods for establishing a verified container weight. Method 1 prescribes that, once a container is packed and sealed (using calibrated and certified equipment), the shipper has to weigh the container or arrange for a third party to weigh it. Method 2 advises the shipper, or a third party, to weigh the package and cargo, including the mass of the pallets and packing material to be packed in the container, and add the tare mass of the container to the sum of the container’s contents. The tare mass must be visible on the exterior of the container. Estimations of weight is not permitted. The shipper cannot rely on the weight provided by another party unless the weight is clearly and permanently marked on the container. Shippers choosing the second method must comply with requirements established by countries where the container is packed and sealed. The IMO considers Method 2 inappropriate for bulk cargo, such

as unbagged grain, that does not lend itself to individual weighing.

Electronic Form Encouraged Shippers can communicate the VGM in a document, preferably in electronic form. The certificate must be signed by someone authorized by the shipper. Because the contract of carriage is between the shipper and the carrier, not between the shipper and the port terminal facility, the shipper can meet its obligation by submitting the VGM to the carrier. It then becomes the carrier’s responsibility to provide the VGM to the terminal representative before loading. The carrier can also submit the VGM to the port terminal upon delivery of the container to the port before loading. Containers exceeding the maximum permitted weight cannot be loaded onto a ship. The ship’s master decides whether a container can load. Terminal operators and carriers need to establish processes for handling packed containers presented for loading that do not have a verified gross weight. Communication and preparation will be key to avoiding disruptions once the new rules are in effect.

A Learning Process “There are lots of details that are not quite clear, but the IMO basically gave a very clear signal of how this is to be done,” says Arne Martinsen, a shipping and transportation consultant to the Global Cold Chain Alliance (GCCA) and a member of the World Food Logistics Organization Board of Governors. “Every-

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SR: SOLAS continued body will know what the rules are by the time they get started working on it,” he says. The IMO encouraged a threemonth grace period on the rule due to the confusion and lack of consistency of interpretation by enforcement authorities.

Disruptions Minor So Far

“Onlevel,a global some

cargo

has been turned away.” Bryn Heimbeck, Trade Tech Inc.

There were not a lot of delays when the July 1 deadline passed. However, there was confusion among shippers over which terminals were providing weighing services. Some shippers complained carriers were adding new charges. There were also reports of carriers rejecting cargo on account of the VGM weights not being provided, although these reports were not extensive. The Global Shippers Forum (GSF) noted in early July that some of its members, mainly in Asia and Africa, reported certain carriers and service providers were exploiting the VGM rules by imposing charges for unspecified administration fees and services. The GSF called for those charges to be withdrawn. “It’s going to take some time for this to settle out,” says Bryn Heimbeck, president of Trade Tech Inc., a logistics software provider that facilitates VGM data delivery. Some terminals are providing the weighing while others are not. He says there is a heightened sense of urgency

among shippers. “On a global level, some cargo has been turned away. Some carriers are saying, ‘We’re not going to worry about it for now.’ It’s truly a hodgepodge.” Heimbeck says the flow of maritime information is disjointed to begin with. The VGM rule is creating a demand for a level of visibility that does not currently exist in the industry. The rule may push multiple parties to collaborate. “There’s been limited guidance from our government on what the actual requirements would be,” he notes. The Ocean Carrier Equipment Management Association (OCEMA), which represents the majority of the ocean carriers in the United States, applauded the efforts of the ports and marine terminal operators that announced they will provide VGM weighing services on behalf of exporters. The OCEMA encourages terminal operators to weigh containers moving through their truck gates and provide the gross container weights directly to ocean carrier stowage planners. Shippers availing themselves of this option would not be required to provide a signature to the ocean carrier for each container, but would acknowledge that the use of on-terminal scaling provides a VGM, according to the OCEMA. The U.S. Coast Guard, which enforces maritime regulations in the United States, notes that the processes used by terminals to obtain gross container weights are compliant with the SOLAS mandate.

TYSON FRESH MEATS CLAIMS VGM RULE WILL CAUSE DELAYS

Perry Bourne, director of international transportation and rail operations for Tyson Fresh Meats, told a U.S. Senate Committee in April the verified gross mass (VGM) rule will cause delays. Bourne testified before the Senate Committee on Commerce, Science and Transportation’s Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety and Security on behalf of the Agriculture Transportation Coalition. Bourne stated that the weight of the container assigned to Tyson’s booking is not known at the time of loading. If Tyson is unable to obtain the container weight for the VGM until the time of transloading, any cargo transloaded late would have to be delayed for the following week’s sailing, and Tyson would have to air freight the cargo or convert a chilled fresh product to a frozen product.

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Cold Storage Operators Impacted Cold storage operators may have to provide VGM data for containers at completion of packing, the GCCA noted in a guidance document on SOLAS. In such cases, the cold storage client is the named shipper on the ocean bill of lading. The client’s shipping manager or other authorized staff can sign the VGM based on the weight data received from the operator. Cold storage operators involved in the loading, shipping or transporting of marine containers are working with shippers, carriers and terminals to determine strategies for meeting the requirements. The GCCA guidance document notes the following companies are developing software to facilitate digital delivery of VGM data: • INTTRA, an ocean shipping e-marketplace, seeks to make the digital delivery of the VGM of a container as simple and straightforward as possible. • Trade Tech Inc., a provider of transportation management and supply chain solutions, has an e-shipping portal named Syrinx. • Kewill Inc., a freight forwarder and provider of supply chain software, in partnership with INTTRA, developed freight forwarding software for the SOLAS container weight verification requirement.

www.foodlogistics.com

8/4/16 1:06 PM


• Mobileweight LLC, a global container shipping solutions provider, developed a solution for the electronic VGM filing with ocean carriers. One area of uncertainty is the cutoff time for the delivery of the containers to the terminal with the weight information ready. Shippers may need to build extra time into

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their supply chains in order to submit the VGM details so that stowage planning can be completed before loading. The GCCA guidance document includes information on the positions on VGM of various international ports outside of the United States. Out of the 162 nations that are signatories to the IMO, only 23 issued the required guidance and regulations to exporters, port terminals and international shipping companies by midsummer. Vincent Clerc, chief commercial officer for Maersk Line, expects a “bumpy” six-month period. “We are committed to making the process as easy as possible—but we also anticipate the next six months to be bumpy,” Clerc wrote on LinkedIn in mid-June. “As we have been preparing for implementation of the VGM, it has been clear that coordination and alignment on a global level—with hundreds of jurisdictions with very different shipping and trade tradition—have to improve.” Maersk recommends three steps to its customers. First, provide the

VGM at the time of creating shipping instructions. Second, submit the VGM electronically to avoid manual mistakes. And third, submit the VGM free of charge on the Maersk website. Mediterranean Shipping Company (MSC) instructed shippers to include the following items on VGM instructions: booking of bill of lading number, container number, the VGM in pounds or kilograms, the responsible party’s name and a digital signature of the authorized signatory. MSC requires shippers to send VGM instructions to its website via electronic data interchange (EDI) using INTRRA, GT Nexus or CargoSmart Limited, or manually via fax or email. The manual VGM submission fee is $25 per container, with an additional $25 late fee per container. There is also a $300 fee per misdeclaration per container. The Agriculture Transportation Coalition, representing exporters, notes there is still work to be done, particularly for containers arriving at terminals without going through the gates by on-dock rail.

8/4/16 1:06 PM


SPECIAL FEATURE

BY EDITORIAL STAFF

FOOD LOGISTICS’ 2016 TOP

3PL & COLD STORAGE PROVIDERS More providers are expanding their portfolio of services to meet industry demands. o one can debate that the role third-party logistics (3PL) and cold storage providers play in today’s challenging cold supply chain is an important one. The companies on this year’s Top 3PL & Cold Storage Providers list continue to improve their expertise, and keep up with the latest temperature monitoring technologies, transportation management systems and warehouse management systems. Their capabilities are as diverse as the customers they serve—from small local producers to global food manufacturers—all of whom have unique requirements. Transportation and logistics in the food supply chain, especially perishables, requires a commitment on the part of 3PLs and cold storage providers to continually invest in their own operations to meet the needs of their customers’ operations. To help logistics professionals know whom they can turn to for help in temperature control and transport issues, Food Logistics offers its annual compilation of Top 3PL & Cold Storage Providers as an up-to-date list of providers with a summary of their capabilities. This list provides a handy resource to transportation decision-makers, giving them a snapshot of these 3PL and cold storage companies, and the geographic region(s) they serve. Congratulations to all of the companies earning a spot on the 2016 Top 3PL & Cold Storage Providers list.

AFN

Location: Niles, Illinois Website: www.loadafn.com Year Founded: 2003 Number of Employees: 190 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Non-asset Worth Noting: AFN is a uniquely people-powered logistics company that provides dry van and refrigerated truckload, less-than-truckload (LTL), and partial services to leading food and beverage industry clients throughout North America. Recently, Ocean Spray Cranberries Inc. named AFN as its 2015 Partner of the Year. The company’s holistic approach to shipping helps its clients select the most efficient and cost-effective methods for

34

moving freight, enabling them to reach their short- and long-term business goals.

Allen Lund Company

Location: La Cañada, California Website: www.allenlund.com Year Founded: 1976 Number of Employees: 436 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Non-asset Worth Noting: Allen Lund Company offers customized transportation management system (TMS) solutions. Each one of its TMS installations is a separate instance on the cloud in the client’s name. While effective for any commodity, these TMS solutions are built to handle the most complicated

FOOD LOGISTICS | AUGUST 2016

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2016

TOP

refrigerated loads. Pricing includes unlimited users and complete support from installation to user training. See how a customized solution can make all the difference for a company with unique needs.

Americold

Location: Atlanta, Georgia Website: www.americold.com Year Founded: 1903 Number of Employees: 11,000 Area(s) Served: North America (U.S., Canada and Mexico) and international Asset/Non-Asset: Both

Worth Noting: Americold offers a complete U.S. national network with facilities in every major food production and consumption market, along with a national LTL consolidation network to save on trucking costs.

Burris Logistics

Location: Milford, Delaware Website: www. burrislogistics.com Year Founded: 1925 Number of Employees: 1,861 Area(s) Served: U.S. region Asset/Non-Asset: Both

Burris Logistics’ promise of integrity delivered remains an integral part of everything it does today.

www.foodlogistics.com

8/5/16 8:50 AM


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8/5/16 8:50 AM


1

Acme Distribution Centers

• • • •

• • • •

• • • •

• • • •

• • •

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

TOP

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

2016

WAREHOUSE/COLD STORAGE

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

3PL SERVICES

• • • • • • •

• • • • •

www.acmedistribution.com

2

AFN

• • •

www.loadafn.com

3

Allen Lund Company

www.allenlund.com

4

• • • • •

Atlanta Bonded Warehouse Corporation

www.atlantabonded.com

6

• • •

Americold www.americold.com

5

• • • •

• TMS, logistics consulting, RFP

Barrett Distribution Centers

• •

• • • • • • •

• • •

• • • •

• • • •

• •

• •

• •

• •

• • • •

• • •

• •

• • •

• • • • • • • • • • • Inbound consolidation to outbound cross-docking, break bulk, pool consolidation

• •

• • • • • • • • • • • • •

• •

• • • •

• •

• • • • •

Kitting, repacking, aisle-ready, AS/RS, light processing Co-packaging that includes: shoebox; overwrap; box pack; tray; quarter-, half-, full-pallet display; PDQ lines

www.barrettdistribution.com

7

Blue Ribbon Transport www.blueribbontransport.com

8

Burris Logistics

• • •

Engineered solutions

• •

• • •

• •

• •

Repackaging

• • •

www.burrislogistics.com

9

C.H. Robinson www.chrobinson.com

10

• • • •

Cardinal Logistics Management

• •

• •

• • • • • • • • • •

Project logistics, carload, flatbed, consolidation, small parcel

• • •

• •

• • • •

www.cardlog.com

11

CaseStack www.casestack.com

12

Choptank Transport

• • •

• •

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• • • • • • • • • • • • •

• • • • •

• • •

• • • • • • • •

Spotting, shuttle, yard management

• •

www.choptanktransport.com

13

Classic Transportation & Warehousing

• • •

www.classictransportation. com

14

Cold Storage Solutions

• •

www.coldstoragesolutions.com

15

Columbian Logistics Network

www.columbianlogistics.com

16

DB Schenker www.dbschenkerusa.com

18

• • • •

• • • •

Cross-docking, transfer services Yard management, high security, 24/7 tracking, pharmaceuticial-grade equipment

• •

• •

• • • •

• •

• • • • • • •

• •

Coyote Logistics www.coyote.com

17

• •

• • • • • • •

• •

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• • • •

• • • • • • • • • •

Detroit Cold Storage

UPS fleet utilization

• •

• •

• •

• • • • •

• •

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• • • • •

www.detroitcold.com

19

DSC Logistics www.dsclogistics.com

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• • • • • •

FOOD LOGISTICS | AUGUST 2016

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• • • • • • • • • • • •

• • • • • • • •

LTL order consolidation, network optimization, carrier rationalization, pool point analysis

Product tempering, long-/ short-term storage

• •

www.foodlogistics.com

8/5/16 8:50 AM


“We’re going with Worley.” y t e

f a S

ty i l a

Qu

y t i iv

t c du

o r P

For more than 35 years, Worley has provided supply chain solutions for some of the world’s most respected Fortune 500 companies and small businesses. Our unmatched dedication to safety, quality and productivity is why we keep hearing “We’re going with Worley.” A better supply chain solution starts at Worley.

W O R L E YCO M PA N I E S . CO M (800) 475-5247 | SALES: (319) 739-0322 H E A DQ UA R T E R O F F I C E S : 4 2 3 S O U T H G AT E C T. S W | C E DA R R A P I D S , I A 5 2 40 4

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20

DSW Distribution Centers Inc. www.dswdist.com

21

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

TOP

WAREHOUSE/COLD STORAGE

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

2016

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

3PL SERVICES

• •

East Coast Warehouse & Distribution

• • • •

• • • •

• • •

• • • • • • • • • • • • •

• • •

• • •

• •

• •

• • • • • •

• •

Variety pack/ display kitting, multi-language labeling, organics, alcohol, pharmaceuticals

www.eastcoastwarehouse.com

22

Echo Global Logistics

• • •

• • • • • • •

• • •

www.echo.com

23

Elston Nationwide Carriers

• •

• • •

• • •

• • • •

• •

• • •

Small parcel audit

www.elstonnationwide.com

24

Flagler Global Logistics

www.flaglergl.com

25

Flagship Food Group

Treatment facilities

www.flagshipfoodgroup.com

26

foodcareplus

www.foodcareplus.com

27

FreezPak Logistics

• • • • •

www.freezpak.com

28

FST Logistics

www.fstlogistics.com

29

FW Warehousing GP Logistics SA de CV

• •

• • • • • •

www.fwwarehousing.com

30

• • • • •

• • • •

Freight management systems

• • • • •

• • • • • • •

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• • • • •

• • •

• •

• • • • • • • • • • • • •

• • • • • • • • • • • • • • • • • • • •

• • • • • • • • • • • • • •

www.porteogroup.com

31

Great Lakes Cold Storage

• •

• • • •

• • •

• • •

• • •

• • • • •

www.glcsinc.com

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H&M Bay Inc.

www.hmbayinc.com

33

Hanover Logistics

• •

• •

• •

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• •

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• •

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www.hanoverlogistics.com

34

Hanson Logistics

• •

www.hansonlogistics.com

35

Henningsen Cold Storage Co.

• • • • • • • • • • • • • • • • • • • • • • • •

www.henningsen.com

36

Hickory Transportation Services

• • • • • • • • • •

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www.hickorytransportation.com

37

Inmar Inc.

38

Integrity Logistics

• • •

• • •

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• • • • •

• • • • •

www.integritylogistics.com

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Extensive DC services for product return management

www.inmar.com

J.B. Hunt Transport Inc.

• • • • • •

Intellectual support, project management

• • • •

• •

• •

• •

www.jbhunt.com

40

Jarrett Logistics Systems

• •

• • •

• •

• • •

• • • •

• •

www.jarrettlogistics.com

38

FOOD LOGISTICS | AUGUST 2016

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www.foodlogistics.com

8/5/16 8:50 AM


WE OUTPERFORM THE REST.

(SO THAT YOU CAN REST.) Whether you’re facing rising freight costs … growing inventories … capacity shortages … Transplace outperforms the rest. We have the technology, size, scale and CPG expertise to optimize your supply chain, alleviate admin burden and support your unique and changing needs. With Transplace as your partner, certainty in your transportation management gives you peace of mind, so that you can rest. Learn how Transplace helps you improve financial performance, increase operational excellence and, ultimately, instill confidence and peace of mind.

TRANSPORTATION MANAGEMENT | INTERMODAL | BROKERAGE transplace.com | info@transplace.com | 1.888.445.9425

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41

JEAR Logistics

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

TOP

WAREHOUSE/COLD STORAGE

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

2016

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

3PL SERVICES

www.jearlogistics.com

42

Johanson Transportation Service www.johansontrans.com

43

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Kane Is Able

www.kaneisable.com

44

Kazi Food Logistics Ltd.

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Logistics management/ consulting, TMS, EDI, audit/claims/ freight payment, load planning/ optimization

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Warehouse/ DC location services

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www.kazifoodlogistics.com

45

Keller Logistics Group

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In-plant services, manufacturing support ISO 9001, WHO, National Drug Authority, STAR

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www.kellerlogistics.com

46

Kenco www.kencogroup.com

47

Kingsgate Transportation

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www.kingsgatetrans.com

48

KTI LTD. www.ktiltd.com

49

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Lanter Distributing

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www.lanterdist.com

50

Legion Logistics www.jointhelegion.com

51

Lineage Logistics www.lineagelogistics.com

52

M&W Distribution Services

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Logistics • •management/ consulting

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High pressure processing

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AIB plastics processing, RPC assembly, 24-hour service

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www.westlgi.com

53

McCook Cold Storage

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www.mccookcold.com

54

MCS Logistics

www.mcs-logistics.com

55

MegaCorp Logistics www.megacorplogistics.com

56

Mid America Logistics

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www.midamlogistics.com

57

Midwest Refrigerated Services

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www.midwestrefrigerated.com

58

Murphy Warehouse Company

www.murphywarehouse.com

59

Newport-St. Paul Cold Storage Co./NCS Trucking

Rail, indoor close-clearance tracks

www.newportcold.com

60

Next Generation Logistics Inc.

www.nextgeneration.com

61

NFI www.nfiindustries.com

40

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FOOD LOGISTICS | AUGUST 2016

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www.foodlogistics.com

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Increase Your Speed

TO MARKET

The Food and Beverage supply chain is highly demanding, and Yusen Logistics serves up fresh ideas and solutions. For 60 years, we’ve worked with growers, manufacturers, distributors and retailers to solve their distribution challenges. Our services include reefer, OTR, LTL, intermodal and warehousing. See what’s on our menu.

Think Together. Move Together. Success Together.

www.yusen-logistics.com 800.414.3895

Freight Forwarding | Warehousing | Customs Brokerage | Origin Cargo Management | Project Cargo | Cross Border | Supply Chain

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TOP 62

NOCS

www.nocs.com

63

Overseas Cargo Inc. (ShipOCI)

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2016

WAREHOUSE/COLD STORAGE

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

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

3PL SERVICES

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www.shipoci.com

64

Pam Young & Company Inc.

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www.pamyoung.com

65

Penske Logistics www.penskelogistics.com

66

Polar 3PL www.polar3pl.com

67

Port Jersey Logistics

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www.portjersey.com

68

Prime Distribution Services (PDS)

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www.prime3pl.com

69

R2 Logistics

www.r2logisticsteam.com

70

Railex LLC www.railex.com

71

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RLS Logistics

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www.rlslogistics.com

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RELIABLE AND SCALABLE

LABOR MANAGEMENT

SOLUTIONS SERVICES INCLUDE:

• POOL DISTRIBUTION • INBOUND / OUTBOUND SERVICES • OPERATIONAL SUPPORT

CONTACT US: www.americanlumperservices.com 866-786-8899 | info@americanlumper.com

FOOD LOGISTICS | AUGUST 2016

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• •

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Worth Noting: Burris Logistics is a high-quality provider of customized perishable, multitemperature supply chain solutions, including freight management, warehousing, distribution and technology solutions. The Burris family’s commitment to exceptional customer service goes back five generations. The company’s promise of integrity delivered remains an integral part of everything it does today—and in all the years to come.

42

DB Schenker

Location: Freeport, New York Website: www. dbschenkerusa.com Year Founded: 1947 Number of Employees: 6,000 Area(s) Served: International Asset/Non-Asset: Non-asset Worth Noting: As barriers to global trade erode, an increasing level of supply chain complexity is becoming necessary to meet global customer demand. Major manufacturers are creating

these layers as they contract new logistics partners to source better and cheaper raw materials, consolidate shipments for cost efficiency and deliver final product to their customers. This is resulting in companies trying to manage dozens of logistics service providers relationships. DB Schenker sets out to link global markets using environmentally friendly, intercontinental, seamless logistics chains. Its customers benefit from appropriate door-to-door solutions and complex service packages covering the entire value chain.

DSC Logistics

Location: Des Plaines, Illinois Website: www.dsclogistics.com Year Founded: 1960 Number of Employees: 3,000 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Both Worth Noting: With over 55 years of experience in the food and consumer packaged goods

www.foodlogistics.com

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3PL SERVICES

72

Roadrunner Transportation Systems Inc.

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Blast Freez ing Cross -Dock Fulfillm ing en Inven t tory/C ost Ac Inven count tory M ing anage Multiment Vendo r Con Order solida Assem tion bly Pick/ Pack A s s embly Privat e Ref Public rig. Wareh ouse Ref Rever rig. Wareh ouse se Lo gistic USDA s/Rec /FDA alls Inspe Vendo r-Man ction a g e d Inve Wareh ntory ous Other ing/Dist. M gmt.

TOP

Air Ca rgo Bulk Contin uous Move Custo s ms Br okera Dedic g e ated C ontra Direc ct Car t Stor riage e Deli Draya very g e Se r v ic e Fleet Leasin s g Freigh t Forw ardin Fuel S g aving s Progr Full Se am rvice M Interm anaged Tran sportati odal on LTL MultiVendo r Con Ocean solida tion Rail Rail/T ruck Trans Refrig load erated Truck Truck ing load Truck load B roker Other age

2016

WAREHOUSE/COLD STORAGE

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www.rrts.com

73

Ruan Transportation Management Systems

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www.ruan.com

74

Ryder System Inc.

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www.ryder.com

75

Saddle Creek Logistics • Services

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www.sclogistics.com

76

Service Cold Storage LLC

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www.servicecold.biz

77

Sonwil Distribution Center

www.sonwil.com

78

Star Distribution Systems Inc.

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Technology consulting, real estate services

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Reverse logistics refurbishment/remanufacture

www.stardistribution.us

79

States Logistics Services

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www.stateslogistics.com

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80

STEF

www.stef.com

81

Total Quality Logistics

• •

www.tql.com

82

Transplace

www.transplace.com

83

Transportation Insight

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

TOP

WAREHOUSE/COLD STORAGE

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

2016

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

3PL SERVICES

• • • • • • • • • • •

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Carrier management/ contracting, shipment planning/optimization, load tendering

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www.transportationinsight.com

84

Transportation One

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www.transportationone.com

85

Trinity Logistics www.trinitylogistics.com

86

Triple T Transport Inc.

Supply chain consulting

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www.triplettransport.com

87

United States Cold Storage

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www.uscold.com

88

Universal Lumpers Inc.

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www.universallumpers.com

89

US Perishables www.usperishables.com

(CPG) industries, DSC Logistics is a leader in transforming logistics and supply chain management into a critical business strategy based on collaborative partnerships, innovative thinking and highperformance operations. DSC achieves the business goals of Fortune 500 and other dynamic companies by designing, integrating, managing and adapting customized supply chain solutions. As a lead logistics partner (LLP) and 3PL, DSC delivers value by reducing total system costs, optimizing business processes, facilitating growth and change, and maximizing the potential of the supply chain. DSC is a certified woman-owned business, and is named annually as a top 3PL and top green supply chain partner by multiple trade journals.

44

DSW Distribution Centers Inc.

Location: Rancho Cucamonga, California Website: www.dswdist.com Year Founded: 1973 Number of Employees: 55 Area(s) Served: National (entire U.S.) and international Asset/Non-Asset: Asset Worth Noting: DSW Distribution Centers Inc. is a 43-year-old, family owned 3PL offering an array of value-added services with specialized licensing and multiple temperatures for the food, pharmaceutical and biotechnology, beverage and CPG industries.

FST Logistics

Location: Columbus, Ohio Website: www.fstlogistics.com Year Founded: 1991 Number of Employees: 260 Area(s) Served: National (entire U.S.)

FOOD LOGISTICS | AUGUST 2016

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Asset/Non-Asset: Both Worth Noting: FST Logistics is an employee-owned company and 100 percent focused on customer service, so much so that its high-quality service is recognized around the 3PL world. The company’s assetbased temperature-controlled transportation like LTL and truckload (TL), along with full-service temperaturecontrolled warehouse offerings, such as picking and packing, display building, kitting and e-commerce order fulfillment, allows FST to be a one-stop shop.

Great Lakes Cold Storage

Location: Solon, Ohio Website: www.glcsinc.com Year Founded: 1999 Number of Employees: 155 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Asset

Worth Noting: Great Lakes Cold Storage offers full-service distribution of millions of cases per year for various grocery chains, seven days a week, 363 days a year.

H&M Bay Inc.

Location: Federalsburg, Maryland Website: www.hmbayinc.com Year Founded: 1982 Number of Employees: 574 Area(s) Served: National (entire U.S.) Asset/Non-Asset: Non-asset Worth Noting: H&M Bay is a nationwide logistics provider of LTL refrigerated and frozen commodities. H&M Bay has consolidation centers strategically located nationwide, along with a host of web-based systems for ordering and tracking, to help customers manage all of their shipping needs.

www.foodlogistics.com

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90

Veracity Logistics

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

TOP

WAREHOUSE/COLD STORAGE

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

2016

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

3PL SERVICES

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www.veracitylogistics.com

91

VersaCold Logistics Services

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www.versacold.com

92

Weber Distribution LLC

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www.weberlogistics.com

93

Werner Enterprises/ Werner Logistics

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www.werner.com

94

Wheels International

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www.wheelsgroup.com

95

Worley Warehousing Inc.

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www.worleycompanies.com

96

WSI www.wsinc.com

97

Yusen Logistics (Americas) Inc.

• • • • •

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Co-packing, kitting, labeling, shrinkwrapping

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www.yusen-logistics.com

98

Zipline Logistics

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www.ziplinelogistics.com

Hanover Logistics

Location: Hanover, Pennsylvania Website: www. hanoverlogistics.com Year Founded: 2006 Number of Employees: 135 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Both Worth Noting: Hanover Logistics is made up of two long-standing, privately held operating companies—R.H. Crawford Inc. trucking and Hanover Terminal Inc. warehousing. Hanover Logistics has been on the Food Logistics Top 3PL & Cold Storage Providers list since 2010.

Henningsen Cold Storage Co.

Location: Hillsboro, Oregon Website: www. henningsen.com Year Founded: 1923

46

Number of Employees: 330 Area(s) Served: National (entire U.S.) Asset/Non-Asset: Non-asset Worth Noting: Henningsen Cold Storage Co. is a fifthgeneration, family owned, full-service temperaturecontrolled storage and logistics provider. The company operates a national network of warehouses in Oregon, Washington, Idaho, North Dakota, Oklahoma and Pennsylvania. Henningsen has also been named a Top Green Provider by Food Logistics for the past two years.

Hickory Transportation Services

Location: Jacksonville, Florida Website: www. hickorytransportation.com Year Founded: 2008 Number of Employees: 60 Area(s) Served: North America

FOOD LOGISTICS | AUGUST 2016

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Tempcontrolled rail

• •

(U.S., Canada and Mexico) Asset/Non-Asset: Both Worth Noting: Unlike typical 3PLs, Hickory Transportation Services is an asset-based carrier first and a broker second. As the sole transportation partner for BUBBA Foods and Peterbrooke Chocolatier, Hickory Transportation is also a shipper that knows the pain points of each of its customers. With a highly experienced team, the company moves hundreds of temperaturesensitive loads every week and specializes in lanes east of the Mississippi, along with the entire state of Texas.

Integrity Logistics

• •

(U.S., Canada and Mexico) Asset/Non-Asset: Non-asset Worth Noting: Integrity Logistics is a proud member of the Fellowship of Companies for Christ International (FCCI). As a member of this organization, the company pledges to conduct business with the highest moral and ethical standards. Integrity Logistics is also an active part of its community, supporting a variety of charities, including partnerships with many of its clients. Additionally, 25 percent of Integrity’s staff are certified transportation brokers and the company is also a member of the Environmental Protection Agency’s (EPA’s) SmartWay Transport Partnership.

Location: Wilsonville, Oregon Website: www. integritylogistics.com Year Founded: 1988 Number of Employees: 20 Area(s) Served: North America

www.foodlogistics.com

8/5/16 8:50 AM


Miles Beyond. Proprietary software that captures capacity and provides real time visibility. We collect the data, but its yours to keep. Receivers enjoy the visibility. Shippers embrace the capacity. Management loves the consolidation. Contact us to see how Transfix can help your transportation team without increasing your transportation budget.

call: 929.293.0410

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email: sales@transfix.io

visit: www.transfix.io

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Global Supply Chain Solutions for the Food and Beverage Industry

GET THE RECOGNITION YOU DESERVE! FL100+ TOP SOFTWARE & TECHNOLOGY PROVIDERS RECOGNIZING TOP SOFTWARE AND TECHNOLOGY PROVIDERS SUPPORTING THE GLOBAL FOOD AND BEVERAGE SUPPLY CHAIN

2016

Is your company a top-performing software or technology provider? Then apply for the FL100+, Food Logistics’ annual list of the leading 100-plus software and technology providers to the food and beverage industry. Recognized companies will appear in the November/December 2016 issue of Food Logistics magazine and online at www.FoodLogistics.com. Food Logistics’ FL100+ is an impressive list of software and technology providers who are major players in our industry, as well as the supply chain sector at large. Nomination deadline: Sept. 19, 2016 | Winners announced in Nov/Dec 2016 issue

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FoodLogistics.com/Awards Nomination dates and issues may change. Consult the call-for-entries email and nomination survey for confirmation

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Johanson Transportation Service

Location: Fresno, California Website: www. johansontrans.com Year Founded: 1971 Number of Employees: 90 Area(s) Served: North America (U.S., Canada and Mexico) and international Asset/Non-Asset: Non-asset Worth Noting: 2016 Johanson Transportation Service has been a transportation member of Blue Book Services Inc. since 1979, which puts it in an elite group of reputable and honest companies with strong financial positions and trading policies. Johanson Transportation Service has a $1.5 million credit score with the highest rating of Four X. The company not only earned the highest four-star rating with Red Book Credit Services, but also earned the Business Character Award, which reflects high ethical trading practices, business competence and financial stability.

make products people love. Kane’s job is to get them to market with dependable people and logistics.

Keller Logistics Group

Location: Defiance, Ohio Website: www. kellerlogistics.com Year Founded: 1978 Number of Employees: 348 Area(s) Served: U.S. region Asset/NonAsset: Both Worth Noting: Keller Logistics Group is a family-owned asset-based 3PL offering three decades of logistics expertise. From maker to market, this company has it covered as a complete logistics solutions provider.

TOP

Kane Is Able

Location: Scranton, Pennsylvania Website: www.kaneisable.com Year Founded: 1930 Number of Employees: 1,200 Area(s) Served: National (entire U.S.) Asset/Non-Asset: Both Worth Noting: Kane Is Able’s customer-centric culture is built on 86 years of family ownership. The company’s metrics-driven, lean Six Sigma operations deliver logistics with greater accuracy and efficiency. Kane’s associates are honored to be recognized by partners like Sam’s Club (3PL of the Year two years in a row) and KimberlyClark Corporation (Best Overall Distribution Center Performance). Manufacturers

www.foodlogistics.com

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Kenco

Location: Chattanooga, Tennessee Website: www. kencogroup.com Year Founded: 1950 Number of Employees: 4,000 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Both Worth Noting: Kenco’s integrated logistics platform focuses on a commitment to service and cultural alignment, while providing vertically integrated and engineered solutions with its partners. The company is also a U.S. and Canadian-focused company with the capabilities to fulfill supplier diversity requirements. Furthermore, Kenco is proud to be the largest woman-owned 3PL company in the United States.

Kingsgate Transportation

Location: West Chester, Ohio Website: www. kingsgatetrans.com Year Founded: 1986 Number of Employees: 44 Area(s) Served: North America (U.S., Canada and Mexico)

Asset/Non-Asset: Non-asset Worth Noting: Kingsgate Transportation brings unique solutions to food manufacturers and distributors to drive significant costs out of their supply chain. Supported by best-in-class technology, the company provides integrated and customized solutions specific to clients’ needs. Kingsgate Transportation is a womanowned, Women’s Business Enterprise National Council (WBENC)-certified company with a U.S. and Canadian focus. It is capable of meeting supplier diversity goals.

KTI LTD.

Location: Pulaski, Virginia Website: www.ktiltd.com Year Founded: 1995 Number of Employees: 46 Area(s) Served: North America (U.S., Canada and Mexico) and international Asset/Non-Asset: Both

Worth Noting: KTI is a family owned and operated company that has been providing firstclass service to its customers for over 20 years. KTI offers low-cost, value-added, turnkey logistics solutions to customers of all sizes. The company’s success is a result of a dedicated team committed to providing each customer with personalized service.

Lineage Logistics

Location: Irvine, California Website: www. lineagelogistics.com Year Founded: 2006 Number of Employees: 6,000 Area(s) Served: National (entire U.S.) Asset/Non-Asset: Asset Worth Noting: Lineage Logistics recently opened new facilities in North Charleston, South Carolina, and Long Beach, California, expanding its national cold storage footprint to more than 610

AT DSW, WE’VE EARNED THE TRUST OF MANY... BECAUSE WE HAVE MADE THE COMMITMENT TO APPRECIATE THE NEED FOR FLEXIBILITY, COST-EFFICIENCY AND SUPERIOR QUALITY CUSTOMER SERVICE. • Over 3 Million Cubic Feet of Racked Multi-Temperature Controlled Space Located in the Distribution Hub of Southern California. • Alcoholic Beverages, Confections, Refrigerated Juices & Smoothies, Juice, Co-Packer Raw Materials, Dairy-Deli Products, Film, Yogurt, Pharmaceuticals, Industrial and Baking Food Products, Food Service and General Grocery Items.

• In-House Modern Fleet of Refrigerated Transportation Equipment, Freight Consolidation • Wide Array of Value-Added Services Total Logistics Management • Complete Product Monitoring with 24/7 On-Line Access. EDI, CSV, FTP, XLS • Food-Pharma Clean Room • All-Inclusive Rate Structure

• Organic & Natural Food Products

• State Board of Pharmacy Licenses

• Flexibility, Cost-Efficiency and Superior Quality Customer Service.

• International Language Labeling • Alcoholic Beverage Licenses, 14/17

DSW DISTRIBUTION CENTERS, INC. A Thayer Group Company

8858 Rochester Avenue Rancho Cucamonga, CA 91730 Mailing: P.O. Box 1269, RC, CA 91729-1269 Phone: (909) 483-5841, Ext. 117 Fax: (909) 483-1792 www.dswdist.com • sales@dswdist.com

AUGUST 2016 | FOOD LOGISTICS

49

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million cubic feet at 113 facilities in 22 states. Lineage Logistics also added highpressure processing capacity at two locations and initiated energy savings programs throughout the network.

M&W Distribution Services

Location: Atlanta, Georgia Website: www.westlgi.com Year Founded: 1972 Number of Employees: 250 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Both Worth Noting: M&W Distribution Services was named the 2015 recipient of the Eastman Service Excellence Award for a 3PL facility with a perfect score of 100. The company is a foodgrade, full-service, asset-based 3PL offering temperaturecontrolled warehousing. M&W Distribution Services facilities in Atlanta and Tampa, Florida, are maintained to the American Institute of Baking (AIB) Superior standards for sanitation and pest control.

Penske Logistics

Location: Reading, Pennsylvania Website: www. penskelogistics.com Year Founded: 1969 Number of Employees: 13,740 Area(s) Served: North America (U.S., Canada and Mexico) and international Asset/Non-Asset: Both Worth Noting: Penske won a host of awards last year, including: Lowe’s Gold Carrier award, Knoll’s Operational Excellence award, Whirlpool’s

Special Supplier award and the Eastman Chemical Supplier Excellence award.

Polar 3PL

Location: Mars, Pennsylvania Website: www.polar3pl.com Year Founded: 2014 Number of Employees: 5 Area(s) Served: North America (U.S., Canada and Mexico) Asset/Non-Asset: Both Worth Noting: Polar 3PL offers both asset-based temperaturecontrolled transportation and warehousing/cross-dock services out of Solon, Ohio, and Cranberry Township, Pennsylvania, to customers across North America. Competitive rates and convenient transit times are provided through a multivendor consolidation program, and all sizes of shipments are handled without delay.

Port Jersey Logistics

Location: Cranbury Township, New Jersey Website: www.portjersey.com Year Founded: 1954 Number of Employees: 185 Area(s) Served: National (entire U.S.) Asset/Non-Asset: Both Worth Noting: Port Jersey Logistics operates two divisions, Continental Logistics Inc., a transportation management division; and Tyler Distribution Centers Inc., a warehousing division. Both divisions focus almost entirely on servicing the packaged food and food ingredients industries.

RLS Logistics

Location: Newfield, New Jersey Website: www.rlslogistics.com

Year Founded: 1988 Number of Employees: 150 Area(s) Served: National (entire U.S.) and international Asset/Non-Asset: Both Worth Noting: RLS Logistics is a cutting-edge provider fully committed to food safety through British Retail Consortium (BRC) certification, energy-saving facilities and utilizing solar to reduce costs.

Area(s) Served: U.S. region Asset/Non-Asset: Both Worth Noting: Star Distribution Systems continues to be one of Florida’s premier 3PLs, winning awards that include: Bell-Carter Foods’ Service Provider of the Year (8th consecutive year); SunMaid Growers’ Warehouse of the Year; Hospira’s Service Provider of the Year; and PVH Corp.’s Best in Service award.

Ryder System Inc.

Transplace

Location: Miami, Florida Location: Frisco, Texas Website: www.ryder.com Website: www.transplace.com Year Founded: 1933 Year Founded: 2000 Number of Employees: Number of Employees: 1,234 Over 33,000 Area(s) Served: North America Area(s) Served: North (U.S., Canada and Mexico) America (U.S., Canada and Asset/Non-Asset: Non-asset Mexico) and international Worth Noting: Transplace Asset/Non-Asset: Both is a North American Worth Noting: Ryder non-asset-based 2016 leverages deep logistics services industry experience provider offering to deliver best-inmanufacturers, class warehousing, retailers, chemical packaging and and CPG companies transportation. The the optimal blend company combines a full menu of logistics technology and of solutions—from source transportation management to shelf, fleet maintenance services. The company’s to inventory management, services and capabilities safety to sustainability, include transportation packaging to driver management services, recruitment—with industryintermodal, brokerage and specific expertise gained from software-as-a-service (SaaS) serving thousands of food transportation management and beverage companies, (TMS) solutions supplemented including the top 10 food by supply chain strategy and beverage companies consulting services. The in the United States. company is recognized among elite 3PLs for its Star Distribution proven ability to deliver both Systems Inc. rapid returns on investment Location: Plant City, Florida and consistent value to a Website: www. customer base ranging from stardistribution.us mid-market shippers to Year Founded: 1931 Fortune 500 companies. Number of Employees: 300

The breadth and depth of Transportation Insight offerings encompasses robust technology, Big Data solutions, supply chain analytics, streamlined operational processes and proprietary continuous improvement methodologies for the end-to-end supply chain.

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TOP

Transportation Insight

Location: Hickory, North Carolina Website: www. transportationinsight.com Year Founded: 1999 Number of Employees: 419 Area(s) Served: North

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WSI’s commitment to absolute reliability— guaranteeing products arrive in the best shape, in the right quantity, at the correct time—is key to its clients’ supply chain processes. America (U.S., Canada and awarded Leadership in Energy Mexico) and international & Environmental Design Asset/Non-Asset: Non-asset (LEED) Gold certification status Worth Noting: Transportation by the U.S. Green Building Insight is a multi-modal Council (USGBC). In enterprise logistics addition, the company’s provider with topBakersfield, 2016 tier solutions in California, facility all transportation was awarded modes. The Kellogg’s Top Gun breadth and depth award for 2015, of its offerings while its Hazleton, encompasses robust Pennsylvania, branch was technology, Big Data solutions, awarded Unilever’s Frozen supply chain analytics, Distribution Center of the streamlined operational Year and the Butterball processes and proprietary 2015 Warehouseman continuous improvement of the Year award. methodologies for the endto-end supply chain. With Universal the ability to coach, teach Lumpers Inc. and train clients’ supply chain Location: Denver, Colorado teams to drive excellence, Location: www. Transportation Insight’s skilled universallumpers.com professionals act as expertise Year Founded: 1982 multipliers, partnering with Number of Employees: 500+ businesses to align their supply Area(s) Served: National chains with strategic business (entire U.S.) goals that create long-term Asset/Non-Asset: Non-asset value and increase profitability. Worth Noting: Universal Lumpers has over 30 years of United States industry-leading experience Cold Storage that focuses solely on Location: Voorhees, lumping and logistics. Unlike New Jersey other lumping companies, Website: www.uscold.com Universal Lumpers provides Year Founded: 1889 logistics services as part Number of Employees: 3,000 of the industry-standard Area(s) Served: National lumping fees. The company (entire U.S.) is committed to the people Asset/Non-Asset: Both on its team—all experienced Worth Noting: United States and dedicated experts in their Cold Storage is dedicated to fields—and its people are being the leader in providing committed to customers. It’s reliable and cost-effective that entrepreneurial spirit logistics solutions to the that makes the company a frozen and refrigerated food lumping and logistics leader, industry, giving customers the proudly serving Fortune 100 competitive edge they and 500 companies, along with need to succeed in the some of the finest grocery ever-changing business and foodservice providers environment. Its Covington, in the United States. Tennessee, facility was recently

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US Perishables

Location: Lafayette, California Website: www. usperishables.com Year Founded: 2007 Number of Employees: 14 Area(s) Served: U.S. region Asset/Non-Asset: Both Worth Noting: US Perishables was named to Inc. magazine’s 5000 Fastest Growing Companies list and San Francisco Bay Area’s Fastest Growing Companies list. US Perishables specializes in LTL and TL temperaturecontrolled products, and offers warehousing, direct delivery and cross-docking services.

Worley Warehousing Inc.

Location: Cedar Rapids, Iowa Website: www. worleycompanies.com Year Founded: 1977 Number of Employees: 120 Area(s) Served: North America (U.S., Canada and Mexico) and international Asset/Non-Asset: Both Worth Noting: Worley Warehousing is a food-grade 3PL. The company’s disciplined approach to executional excellence distinguishes it from the competition. Food safety and food defense, as well as regulatory compliance, is supported by its ISO 9001:2008 and organic certifications. Worley’s clients rely on the company as a supply chain partner and as subject matter experts.

WSI

Location: Appleton, Wisconsin Website: www.wsinc.com Year Founded: 1966 Number of Employees: 1,200 Area(s) Served: National (entire U.S.) Asset/Non-Asset: Both Worth Noting: From canned tomatoes to non-fat dry milk to cranberries, WSI is the dry foods expert. Adhering to rigorous conditions, count and time standards and safety regulations, WSI ensures products leave warehouses in top condition for journeys across town or overseas. Its commitment to absolute reliability—guaranteeing products arrive in the best shape, in the right quantity, at the correct time—is key to its clients’ supply chain processes. Clients can rely on WSI to be an extension of their brands.

Yusen Logistics (Americas) Inc.

Location: Secaucus, New Jersey Website: www.yusenlogistics.com Year Founded: 1955 Number of Employees: 2,600 Area(s) Served: North America (U.S., Canada and Mexico) and international Asset/Non-Asset: Non-asset Worth Noting: Yusen Logistics has more than four decades of experience working with food growers, manufacturers, suppliers and retailers to help them solve their unique supply chain requirements. The company handles nearly $1 million in food- and beverage-related business each year. Its services include: reefer, over the road, LTL, flow-through warehousing and retail point-of-sale (POS) display management.

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SECTOR REPORTS WAREHOUSING: ROBOTICS & AGVS

BY ELLIOT MARAS

ROBOTICS AND AUTOMATION:

EVOLUTION,

NOT REVOLUTION Robots take on more picking, sorting and packaging as technology advances.

R

obotics and automation are not as widely used in the food and beverage supply chain as in some other industries. But adoption is expected to accelerate given the improved efficiencies they bestow on operations and the requirements of the expanding e-commerce sector. Robotics and automation were cited as the leading source of disruption or competitive advantage by the 2016 Material Handling Institute Annual Industry Report; these technologies were touted as such by 51 percent of respondents, which is up from 39 percent last year.

Recent technological breakthroughs that can help create the next generation of robots include low-cost sensors, faster computers, Big Data analytics, more powerful batteries, cloud computing and mobility, according to a recent DHL report. Robots are also increasingly able to demonstrate human-like capabilities and traits, such as sensing, dexterity, memory and trainability. They are being integrated into supply chains and taking on more human-oriented tasks, including picking and packaging. Until recently, robotics technology did not make a big impact in logistics, according to DHL. This is about to change, however, as advanced robots enter warehous-

KUKA’s new LBR is a collaborative robot that can safely be used in the same environment as humans. KUKA, Swisslog’s parent company, uses robots in food production environments.

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es and sorting centers, and even help with final-mile delivery. Robotics mark an upgrade beyond material handling automation solutions, such as conveyors, sorters, goods-to-person solutions and other mechanized equipment to improve productivity. While some of the components of these older systems—automated storage and retrieval systems (ASRSs), automated guided vehicles (AGVs) and shuttles—can be considered a type of robot, they do not provide the same level of robotic functionality that industry observers say may become commonplace. At the present time, most distribution centers have yet to deploy automated material handling solutions, let alone robots. In the food and beverage space, the production and processing sectors are the most technologically advanced. Observers believe the warehousing sector may be catching up in the near future. “Robotics started in palletizing with food, then migrated to secondary packaging, and later to primary packaging and processing,” says Raad Asmaro, an account manager at FANUC America Corporation. “We continue to develop robotic solutions to tackle logistics applications like mixed load palletizing, depalletizing, tote picking and handling, automated storage and retrieval, robotic labeling,

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SR: WAREHOUSING: ROBOTICS & AGVS continued

It is possible to

save 50 percent of warehouse picking labor with these systems through the elimination of walking. and truck loading and unloading. Anytime you have a demand, robotic technology will evolve to make the impossible possible. “It will eventually evolve its way downstream more and more into logistics as robotic solutions become more common,” he continues. Asmaro is one of several observers who point to Amazon as a warehouse technology pioneer with

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its automated goods-to-person system and mobile robot that moves inventory from one area to another. “When Amazon is satisfied with its robotic automation, everybody will follow,” he says. The goods-to-person concept can be found in several technologies on the market today, such as Swisslog AG´s CarryPick mobile system. It is possible to save 50 percent of warehouse picking labor with these systems through the elimination of walking. Currently, most of these systems are capital intensive, requiring a network of connected shelves, tracks, robotic shuttles, elevators and conveyors. Even after this investment, they still require people to pick items from an automatically presented tote or mobile shelf. The manufacturers of goods-to-person material handling systems see this problem as an opportunity to introduce robotic arms. KNAPP AG ’s Pick-it-Easy Robot can automatically change its vacuum cup gripper to better match different products. In contrast, viastore systems Inc.’s viapick system not only picks

an item, but can place it into a shipping carton as well. The opposite of the goodsto-person system is a mobile robot that drives around warehouse shelves and picks items just like a person would.

Robotic Picking Arrives IAM Robotics is currently developing a mobile robot with an arm on top and a camera system that can navigate an existing warehouse, pick items from shelves and place them into an order tote. The system was field-tested in a warehouse where it was able to pick test orders from 40 items it never saw before. The robot uses a 3D depth camera to identify items to be picked. The company has its own software that allows the machine to recognize certain objects and know where to grasp the product, says Tom Galluzzo, CEO. The first deployment will be at a pharmaceutical distributor, but Galluzzo sees tremendous application in the food industry, especially in e-commerce fulfillment. “We talked to a number of folks who are interested in dark store applications,” Galluzzo says. “Grocery e-commerce is successful in certain areas.” He sees AmazonFresh as a major force for food e-commerce. Galluzzo visualizes robotics’ main application as in the fulfillment area. “The more advanced applications for robotics, and the lower hanging fruit on cutting

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costs and increasing throughput productivity is in the fulfillment operation,” he says. There is also a lot of interest in deploying autonomous vehicles for home delivery, but this is further in the future. “This is more of an early adopters game,” he adds. “It’s absolutely going to be commonplace five to 10 years from now.”

E-Commerce Drives Growth The DHL report noted the expansion of e-commerce as a driving factor. Instead of moving product to a retail store in bulk, the organization must pick and pack online purchases individually by hand. The need for freight and parcel handling labor increases since these goods must be shipped as separate parcels to be delivered directly to consumers’ homes. The technology is beginning to catch up with the need to have a robot that is flexible and low-cost enough to work in the logistics and distribution environment. Patrik Seibel, global market leader for food and beverage at Swisslog AG, says some of these systems are deployed in food retail environments. Swisslog’s parent company, KUKA, deploys robots in food production environments. Swisslog is using the KUKA robots to handle single items or crates of food. The new KUKA LBR is a collaborative robot that is safe to be in the same environment as humans. “Food historically dealt with full pallet movement of one SKU, and is now seeing [or feeling] what e-commerce can do to their traditional order fulfillment model,” says Sean O’Farrell, market development director at Dematic Corp. “I believe the food sector has been taking a wait-and-see approach to robotics because of the rapid changes made in other markets and the tight margins in the food industry.” Grocery warehousing is investigating and implementing robotics because of the lack of labor and the effect of e-commerce, O’Farrell adds. “Orders are becoming smaller

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and more frequent, which changes the order build and delivery of the orders. Grocers are looking for flexibility in fulfillment, but are not experiencing the flexibility because a lot of their time is spent on finding and training employees to work in a very demanding environment. The right robotics solution can be a complement to a flexible order fulfillment operation.”

Consumer Buying Habits Change

“We’re seeing more and more of it in the U.S.,” including food companies, says John Clark, director of North American marketing at Egemin Automation Inc., a system integrator that makes AGVs and deploys software in automated material handling equipment. Clark notes that facilities with early-generation automated systems are now looking to modernize that existing equipment with newer software and controls that improve operation and extend the life of equipment. “Automated picking allows for more accurate and precise picking methods,” he says. Modern AGVs do more than just move items. They can be fitted with forklifts or clamp lifts to pick up and transport products in a warehouse. They can also have conveyor roller sections on them that allow the AGV to transport product from an ASRS to another AGV or other areas of a distribution center.

“As buying habits change from consumers, and requirements change from retail and warehouse customers, complexity becomes greater,” says Tom O’Dette, director of engineering at Retrotech. “Robotic solutions bring an opportunity to increase speed, accuracy, efficiency and flexibility, along with reduced cost. The interest in robotics has been strong in this market, but it starts with clearly defined economic and competitive benefits. Our design and analytic teams are engaged in more projects than ever before.” When designing the next generation of logistics robots, there is one key needed to tie together advanced perception, mobility and collaboration— computational power (or brains). More than anything, the emer…WITHOUT MOVING A WALL. gence of advanced 2016 TOP …WITHOUT MOVING A WALL. …WITHOUT …WITHOUT MOVING MOVING APoweracks AWALL. WALL. ...SMALLER FOOTPRINT. …WITHOUT MOVING A WALL. Double your storage capacity with Storax and robotics is tied to imDouble your storage capacity with Storax Poweracks and Double Double your your storage storage capacity capacity with with Storax Storax Poweracks Poweracks and and Storax Ranger. Poweracks replaces conventional, static Double your storage capacity with Storax Poweracks and Storax Storax Ranger. Ranger. Poweracks Poweracks replaces replaces conventional, conventional, static static Storax Ranger. Poweracks replaces conventional, static provements in computaisles with one moving access aisle – increasing inventory Storax Ranger. Poweracks replaces conventional, static aisles aisles with with one one moving moving access access aisle aisle ––increasing – increasing inventory inventory aisles with one moving access aisle increasing inventory ing speed and power. capacity and selectivity. Rangeraisle enables high-density storage aisles with one moving access – increasing inventory capacity capacity and and selectivity. selectivity. Ranger Ranger enables enables high-density high-density storage storage capacity and selectivity. Ranger enables high-density storage and accessibility by circulating pallets onhigh-density a shuttle system. capacity and selectivity. Ranger enables storage Advances in visual and and accessibility accessibility by by circulating pallets pallets on a shuttle system. system. and accessibility bycirculating circulating pallets onaon ashuttle shuttle system. and accessibility by circulating pallets on a shuttle system. image processing, real-time obstacle avoidance and other functions require access to cutting-edge mathematical algorithms and faster computers. Robots will continue to improve and assume more comW W W. F L EX SPACE36 0. CO M L E T ’ S G E T M O V I N G I N F O @F L EX SPACE36 0. C O M plex tasks as computaWWW.FLEXSPACE360.COM E TL ’TSE G’G EST OV T OMIVN OV GG I NINFO@FLEXSPACE360.C GI N FINFO@FLEXSPACE36 W WWWW.FLEXSPACE360.COM W. F L EX SPACE36 0. CO M L#STORAGEMULTIPLIER LE ’ ST EGTMEM IN O @F L EX SPACE36 0.OM C0.OCMOM W W W. F L EX SPACE36 0. CO M L E T ’ S G E T M O V I N G I N F O @F L EX SPACE36 0. C O M tional power increases.

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SECTOR REPORTS TRANSPORTATION: Reefer Trailers & Containers

BY DAN MCCUE

REEFER AND TRAILER

MANUFACTURERS RAISE THE BAR Temperature control and green options expand to further enhance cold chain integrity.

The prototype was installed by a specialist team from Carrier Transicold in North America, which worked alongside technicians at Carrier Transicold Northwest in Liverpool. Photo: carrier.com

Dan McCue is a freelance writer living in Charleston, South Carolina. He writes frequently on tradeand supply chainrelated issues.

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he never-ending quest for absolute cold chain integrity. It’s the daily pursuit that underpins the fruit, vegetable and fresh meat industries. It also happens to be the sweet spot for specialists in the refrigerated truck and trailer sector, who continue to improve not just their cooling systems’ abilities to bring temperature down quickly after pickups and dropoffs, but are also making dramatic strides in developing green systems, while improving access and loading capabilities. This spring, U.K. retailer Sainsbury’s became the first customer anywhere to take delivery of a special Carrier Transicold prototype—a natural refrigerant trailer unit that relies exclusively on a carbon dioxide (CO2) refrigerant. The unit is the first of three that will be incorporated into Sainsbury’s fleet this year and is part of a three-year technology field trial. The prototype incorporates technology from the NaturaLINE refrigeration system into a Carrier Vector unit chassis. Like the Vector unit, the prototype will rely on E-Drive all-electric technology. David Appel, president of Carrier Transicold & Refrigeration Systems, described the delivery of the prototype as “a huge milestone in the development of over-the-road refrigeration using CO2.” “Our ultimate vision is to see temperature-controlled units running on natural refrigerant in mainstream production,” he said.

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European Expansion Carrier Transicold is increasing its market share in Europe, most recently with Fraikin Poland’s purchase of 75 temperature-controlled vehicles for its rental fleet. Working with Carrier Transicold’s Polish affiliate, Fraikin Poland selected 48 Carrier Transicold Xarios 300 units, 21 Viento units with heating, and seven eutectic Vatna 200 units—adding to Carrier Transicold Poland’s 80 percent representation in Fraikin’s fleet. All three units are versatile in over-the-road situations and easy to use—the qualities a company like Fraikin Poland needed considering its diverse fleet comprised of trucks (making up 70 percent of its 626 vehicles), vans (22 percent) and semi-trailers (8 percent).

U.S. Invests in Green The Obama administration’s effort to scale up the adoption of renewable and other green technologies, and other steps to address climate change, couples with more stringent air-quality regulations like those enforced by the California Air Resources Board. These initiatives are creating a booming market for lighter trucks with more efficient technologies. Also enjoying high times in cool temperatures is Thermo King Corporation, which most recently partnered with Stoops Freightliner-Quality Trailer to develop a new climate-controlled straight truck. The Stoops Specialty Trucks Lite truck features Thermo King’s T880

model truck refrigeration unit with electronic throttling valve technology and modulation to provide tight temperature control. It is fitted into a Wabash National all-composite reefer body. The Midwest is also where Thermo King began work on a greatly expanded manufacturing facility in Wichita, Kansas. It is expected to move into the 20,000-square-foot building in 2017.

Partnerships Emerge When Mercedes-Benz Vans broke ground on a $500 million Sprinter manufacturing plant in South Carolina in late July, it revealed that Thermo King will be a key partner as it seeks to expand on its success in the North American market. Mercedes-Benz Sprinter recently experienced five consecutive years of record growth in North America and, in 2015, Mercedes-Benz Vans sold 28,500 units in the United States. With the expansion of manufacturing in the Palmetto State, Mercedes-Benz will offer the cold chain community Thermo King refrigeration in both its Metris and Sprinter vans.

Stoops Freightliner-Quality Trailer developed a climate-controlled straight truck called the Stoops Specialty Trucks Lite truck in response to customer demand. Photo: Stoops Freightliner-Quality Trailer

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Company officials report the Metris refrigerated van will be well suited for farm-to-table, flower and beverage delivery applications. The Sprinter version can be fitted for refrigerated, frozen and deep-frozen options, and allows for 3,300 to 4,000 pounds of cargo. Thermo King also began distributing insulated bulkheads in the Australian market with Randall Manufacturing. The goal, officials at Thermo King Australia say, is to provide its customers with insulated bulkheads that protect the integrity of shipments and ensure they are getting the maximum output from their Thermo King units. The bulkheads officially went on sale in July through dealers in New South Wales, South Australia, Western Australia and Queensland.

Great Dane Steps Forward One company that seems particularly well suited to meeting the demands of the new, climateconscious regulatory regime is Great Dane, which expressly markets its Everest TL as the industry’s lightest weight reefer. From its roof construction to its lighter weight walls to its suspension, the trailer is engineered to minimize weight. In addition, the company says its modular panel foaming process and interior lining are consistent, and are lightweight without sacrificing durability. Other lightweight cold transport solutions offered by the company include the Everest SS reefer, which was created with the long-haul truckload carrier in mind, and the Everest CL, which can be divided into three distinct temperaturecontrolled compartments, and features an ambient section that can be configured to accommodate the diverse needs of the cold chain end customer. A critical component of all three is Great Dane’s patented ThermoGuard technology—a multi-layered insulation design incorporating a metal barrier layer within a composite envelope that the company designed to ensure the thermal www.foodlogistics.com

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integrity of the trailer throughout its supply chain life.

Utility Trailer Expands Utility Trailer Manufacturing Company has been on a growth tear of late, opening manufacturing facilities and dealerships in Minnesota, Arkansas, Florida, Iowa and other states. The company’s best-selling refrigerated trailer is its 3000R, which

uses what the company describes as a foam-in-place insulation process. Because the 3000R foregoes the use of pre-foamed panels in manufacturing, the company opts instead to outfit its trailer with continuous high-pressure foam. Utility Trailer says its customers can rest assured that the environment they are transporting their cargo in is 100 percent void free.

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SECTOR REPORTS

SOFTWARE/TECHNOLOGY

BY ELLIOT MARAS

HOW HYPERMODAL TRADE WILL TRANSFORM LOGISTICS T

Report explores how Big Data and analytics are improving logistics.

he emergence of advanced analytics, along with new modes of transportation like autonomous vehicles, will bring Internet-like speeds and efficiencies to transportation and logistics, saving time and cost, according to a recent report from Lux Research Inc., a research and advisory firm that focuses on emerging technologies. The report notes that transportation and logistics are slow-changing industries that are often inefficient in their use of time, energy, labor and capital. They are also underutilized in terms of capacity. The transportation industry traditionally viewed its constraints in physical terms. But according to Lux Research, there is also something called metaphorical friction that afflicts transportation—wasted energy. Time is wasted in loading, storing and reloading freight. This occurs when assets are stationary in transit and at terminals.

Change Is Coming Improvements are on the way in the form of new modes of transportation, from drones to autonomous vehicles. In the meantime, advanced analytics are bringing better intelligence, analyzing vast amounts of data that many of today’s systems ignore. “The Internet of Things (IoT) is at the stage of a dial-up modem in the evolution of the net, but as it evolves, intermodal and intelligent technologies will create a hypermodal system that moves not just goods, but supply,

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demand and means of production,” as well, says Mark Bünger, Lux Research vice president of research and lead author of the report. Lux Research examined the impact of emerging transportation and logistics technologies on the logistics industry. Their findings include: • Smart containers are coming. Door sensors, GPS and RFID transponders are helping companies such as Maersk Line, General Electric (GE), France’s TRAXENS and Israel’s Loginno Logistic Innovation Ltd. create smart containers. These containers are connected to the cloud and can provide timely alerts. They can detect temperature, vibration and chemicals. • Last-mile delivery is getting more efficient. Amazon and Google, along with startups, such as Matternet, Flirtey and Starship Technologies, are using drones for same-day delivery of small packages. They are establishing new benchmarks in last-mile efficiency. • Drones are on the way. The first commercial delivery by drone occurred in the United States in early 2016. • Distributed manufacturing is emerging. This refers to a form of manufacturing practiced by enterprises using a network of geographically dispersed production facilities coordinated using information technology. Because production and logistics are closely linked, distributed manufacturing has an interdependent relationship with hypermodal transportation. Small factories use flexible machinery like 3D printers and computer numerically controlled (CNC) machines. Flexible components and multi-skilled labor

bring economies of scope rather than scale. While economies of scale achieve reductions in the average cost per unit arising from increasing the scale of production for a single product type, economies of scope lower the average cost by producing more types of products.

Automation Brings Change Autonomous vehicles are changing assumptions of mode, medium and distance. Drones, for example, carry packages in a more efficient last mile than land. New mass transit technologies such as Hyperloop may challenge rail and air. In addition to Elon Musk’s SpaceX, Hyperloop Transportation Technologies built a prototype. Lighter-than-air (LTA) craft carries freight in areas that don’t have roads. At least 20 organizations, including those offering Carangi Air and the Aeroscraft, are developing unmanned LTA aircraft for payloads up to 500 pounds or 500 tons, respectively, as is Lockheed Martin Corporation with its Hybrid Airship. These innovations could compete with ships on speed by bypassing crowded ports. One goal is to reach inland sites that lack roads or rails by 2023.

Data Explosion Continues The volume, velocity and variety of data continues to expand in the transportation industry. The IoT is accelerating this with packages, warehouses and vehicles being increasingly connected. In transportation and logistics, Big Data specifically refers to: • Traditional enterprise data. This

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SR: SOFTWARE/TECHNOLOGY continued is operational data on inventory in enterprise resource planning, point of sale and customer relationship management systems from providers like Oracle and SAP. • Third-party data. This includes market forecasts, fuel prices, traffic and weather data, economic indicators and social media. • Embedded sensors. These sensors on vehicles, packages and people can provide information about location, driver behavior and package status. • Predictive analytics, machine vision and artificial intelligence. These include sensor- and software-generated data that provides financial forecasts and risk scenarios. Advanced analytics can deliver better decisions and actions that

Intermodal transportation

Intelligent transportation Optimization Integration Autonomy

reduce friction and improve transportation profitability. Over time, the process is unfolding with the following capabilities: • Optimization. The transportation industry is beginning to gather data and optimize with it. Route optimization delivers fuel efficiency, decreased labor costs, lower maintenance expenses and more. • Integration. Integrated freight companies such as FedEx reduce fragmentation-based friction by owning each step in the process, from packaging materials to vehicles, planes and more.

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• Autonomy. Amazon, Google and Uber are experimenting with autonomy, particularly warehouse robotics and delivery vehicles on land and in air. For each of these optimization issues, more data, more computing power and better algorithms are keys to progress. Current optimization solutions provide: • Accuracy and transparency. An immediate benefit from better data is knowing what’s going on. OneBusAway, an open-source public transit app, sends real-time bus location data to users’ smartphones. This reduces riders’ wait time by 20 percent, which lowers rider frustration, and increases ridership without spending more on vehicles or drivers. • Logistics expertise. Integrated logistics players, like DHL and FedEx, invested in their own

form logistics tasks like capacity forecasting and predictive asset maintenance. Teradata, a business intelligence provider, worked with DHL on pricing optimization. Oracle is creating data management processes for large data sets, such as fleet vehicle telematics. SAP is connecting enterprise, mobile, and vehicles in land and sea transport. • Town-to-truck connections. Truckers resist mandatory electronic logging for the same reason farmers object to precision agriculture. They fear someone may find where they are cutting corners. But they support technology that helps them, such as personal logging and planning apps TruckTrack, KeepTruckin and, as well as social media sites like Youtruckme.com, a Facebook for truckers network. All of these apps have marketplace tools to connect drivers with shippers that need them to optimize their cargo revenue. Other truck-matching Intermodel + Intelligent = Hypermodal marketplace companies include Keychain Logistics Corp., Cargomatic Inc. and Ghostruck Inc. These services provide real-time visibility into truck availability, proposals and payments. One app, uShip, even connects the shipImage Source: Lux Research Inc. ment to international modes. operations. These companies hope Computing to use their optimized services Power Improves to gain new customers. DHL’s If fragmentation of systems by solutions and innovation unit is scale or type is the problem, more promoting its Big Data services, computing power and better algowhich include sensors, augmented rithms are the solutions. reality, unmanned aerial vehicles One solution is known as and more. Companies with similar cloud shipping. Companies like software include supply chain iContainers, Freight Filter Ltd., solutions providers such as DesCargoSphere and Freightos cartes Systems Group, Elemica integrate data and automate each and GT Nexus. step via cloud-based systems. • Inter-industry best practices Companies like ShipBob, Flexport through analytics vendors. NuInc. and Shipwise are creating logistonian Inc., an artificial intelligence tics dashboards that gather shipping developer, uses analytics to per-

Hypermodal transportation and logistics

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data across modes to help users get quotes, arrange pickup, insure the freight and track packages. Hypermodal logistics aren’t going to initially expand the overall market. Its growth may come at the expense of slow-moving incumbents that fail to change. What are the signs of change? First, vast transportation overcapacity is already ripe for the taking. 3PL and 4PL integrated logistics providers find unutilized capacity in vans, containers and planes, and negotiate rates for additional cargo in the otherwise empty space. Even before autonomy fully unleashes that capacity, crowd and cloud business models are going to emerge. Second, aggressive new entrants are investing in vehicles, infrastructure and interfaces. Amazon is already investing in 767 aircraft and oceangoing ships, plus drone delivery and autonomous vans. Third, all the pieces fit. These information technologies may become part of an ecosystem that extends

Amazon’s supply chain as far forward into consumers’ home storage warehouses as the refrigerator, pantry, closets and garage; and into consumer demand-driving activities like food preparation.

Technology Attacks Logistics Amazon and Uber aren’t alone: Apple, Google and Baidu are pursuing the same opportunity with autonomous craft; smart homes; retail, media and manufacturer tie-ins; and connectivity, sensors and data. As they integrate these assets, they will differentiate between today’s system and the hypermodal future. A detailed map of the flow of customers, goods and orders, down to the centimeter and second, will replace paper-based transportation planning. The winners will shift to making smaller, more frequent deliveries of goods, using the frequency of physical interaction to deepen customer insight and loyalty.

With more data, artificial intelligence and frequent interactions, suppliers will not wait for their orders, but will cause them. The components of this are predictive analytics, anticipatory logistics and nudge technologies. Optimized personal promotions, social media and substitute products will help merchants create customer desire where products already are or soon will be. Delivery companies will have to decide what foods best fit hypermodal commerce—at the intersection of malleable consumer preferences and hard transport economics. Products, demand and production will all be mobile. Hypermodal transportation complements distributed manufacturing and the two will coenable each other.

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AUGUST 2016

| FOOD LOGISTICS

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SECTOR REPORTS OCEAN PORTS & CARRIERS: Cargo Visibility

BY LARA L. SOWINSKI

LEADING CARRIERS INVESTING IN REAL-TIME TRACKING SOLUTIONS BY LARA L. SOWINSKI

Enhanced visibility and control are important benefits for temperaturesensitive cargoes.

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n 2015, Maersk Line began rolling out a new technology— remote container management (RCM)—designed to offer real-time tracking of refrigerated containers, and monitor the temperature, humidity and other conditions inside the reefers to improve cargo care and expedite pre-trip inspections. Already, the carrier equipped 270,000 reefer containers with remote container devices that use a 3G SIM card, a GPS unit and an antenna. In addition, about 400 vessels were outfitted with a VSAT dome, which transmits data gathered from the reefers to a satellite. The data offers many benefits for Maersk Line and its customers. For instance, if an alarm is triggered by a reefer container, it sends the shipper or related parties a notification so they can take immediate action to protect the cargo. “RCM provides data on the container, including its location, power

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status, temperature, humidity and ventilation settings. This data allows us to act quickly when it comes to exception handling, so that we can maintain and prioritize perishable goods at any point in time and as needed,” states Maersk Line. While the technology provides real-time monitoring of time- and temperature-sensitive cargo, in turn helping reduce spoilage, damage and loss of food and pharmaceutical shipments, RCM also gives Maersk Line considerable intelligence about the condition of its reefer fleet. For example, when it comes to pre-trip inspections (PTIs), “We are able to determine the condition of the container upon arrival, so it’s only sent for a PTI when needed,” states the carrier. Last year alone, Maersk Line eliminated 225,000 PTIs, which helped provide faster turnaround of its reefers for customers. According to Catja Rasmussen, Maersk Line’s project head, the time devoted to conducting PTIs was

also reduced from up to six hours to about 12 minutes because so much data was available to the carrier in advance of the reefer container arriving at the terminal. In an interview with Port Technology, Vincent Clerc, Maersk Line’s CCO, said, “The RCM technology will give full visibility of reefer containers and cargo throughout the cold chain, reduce constraints from human errors and allow for safer operations by reducing the number of physical inspections needed at the terminal.” In July, Mediterranean Shipping Company (MSC) announced it would join CMA CGM in backing TRAXENS, a container monitoring and coordination system that received an initial investment from CMA CGM last year. According to Rodolphe Saade, the vice chairman of CMA CGM, “We recognized the need for more data and better data coming from our containers quite a while ago. We are proud to have identified the potential of the TRAXENS solution

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early on. This is just a part of our global digital strategy.” TRAXENS’s container monitoring solution consists of hardware and software. The basic data that can be gathered from the containers (reefers and/or dry containers) includes GPS coordinates, temperature, shocks, door open/ closed status, vibration and movement. Additional data that can be monitored includes internal temperature, humidity and pressure. However, anything that can be measured can potentially be added to the list, states the company. “A normal container with the added electronics that capture and communicate data about their position and condition is what we call a smart container,” according to TRAXENS, which adds, “Data is the next big thing for container shipping. All major shipping companies are looking at how they can get more data from their containers.” Together, MSC and CMA CGM have a combined fleet of 4.5 million units and transport approximately 25 percent of the world’s shipping containers. The deployment of TRAXENS devices across the fleets of both carriers will be announced in Q4 of this year.

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FOOD (AND MORE) FOR THOUGHT

BY ARVIND VENUGOPAL

Food Logistics Industry Embraces Big Data to Optimize the Supply Chain

S VENUGOPAL

As senior product manager, Arvind Venugopal oversees enterprise integration and Big Data gateway solutions at Cleo, an integration software services provider.

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uccess in the foodservice logistics industry ultimately lies in serving the needs of customers through efficient delivery. Doing that better—and at a lower price—differentiates logistics providers in a competitive industry. The unique challenge facing food logistics providers is the nature of the cargo. With perishable items often onboard, it’s even more important for shipments to be on time. The less they’re on a truck, the more time restaurants have to sell them. Organizations must maintain a real-time view of the holistic supply chain that connects restaurants with the entire logistics ecosystem. But that’s no easy task when you consider all of the information passing among geo-distributed people and systems, including purchase orders, invoices, route maps, truck logs, sensor data and financial information. Well-integrated Big Data initiatives provide empirical evidence to: • Optimize transportation routes. • Reduce inventory. • Reduce freight and fuel costs. • Maximize trailer utilization and mobilization. • Reduce emissions. • Gain visibility into buying habits. And while the power of Big Data immediately helps a company’s own food logistics business, customers (and their customers’ customers) also benefit as restaurants implement more flexible replenishment schedules, experience fewer stock-outs and waste less food. But accumulating useful data is not the problem, as most systems and devices currently in use

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generate plenty of digital data that can be stored relatively cheaply. The issue is seamlessly aggregating all of that data into a data lake and piping it into an analytics platform for operationalization. To operationalize Big Data means that the information generated from multiple disparate sources must be first integrated for accurate analysis and then acted upon to drive business outcomes. These sources include local and regional enterprise resource planning (ERP) systems, and back-end production systems, as well as warehouse and transportation management systems. But there’s a wealth of unstructured data from weather stations, GPS technology, smartphones, sensors and even RFID tags that also must be accounted for.

Connecting with Technology In a complicated supply chain that connects farms, processors, suppliers, vendors and restaurants throughout the world using various devices and systems, how does a foodservice logistics provider make doing business with them easier? Today’s savviest restaurateurs opt for a managed supply chain that levers a robust managed file transfer (MFT) and business-to-business (B2B) integration platform to: • Increase visibility with a unified platform that delivers advanced data tracing from a central dashboard, complete with real-time alerts. • Mitigate risk using highly available secure MFT technology with no single point of failure. • Standardize onboarding by supporting the most advanced protocols to quickly say yes to new business.

• Automate workflows and maintain data quality via any-to-any data transformation for improved fulfillment. Embracing a B2B integration platform that securely connects all data endpoints can position food logistics companies to not only optimize the supply chain, but also deliver a superior experience for their customers.

Big Data Gets Results Logistics are a cost that food companies seemingly can control, so it’s not surprising to see a data gold rush for providers looking to stand out in the industry. In fact, leading foodservice logistics companies find that integrating their data flows rewards them with a valuable business advantage. “Big Data presents a great opportunity to improve food logistics operations and, in turn, the customer experience, especially in an industry in which a high-functioning, optimized supply chain can be a huge competitive advantage,” says Brian Dreger, vice president of information technology infrastructure and data management for ArrowStream Inc., a software-as-a-service (SaaS) solution provider for the supply chain. Whether it’s a tweet about a washed-out roadway, several weather forecasts that could affect crop production or hundreds of verifiable RFID scans to ensure farm-to-fork restaurants understand the lifecycle of their products, the foodservice supply chain runs on data. Integrating and acting upon that information using highly reliable MFT and integration technology produces a repeatable optimization process that can continuously elevate customer service.

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Food Logistics August 2016  
Food Logistics August 2016  

Food Logistics is the only publication exclusively dedicated to covering the movement of product through the global food and beverage supply...