Food Logistics August 2017

FSMA UPDATE:

THE FOOD INDUSTRY RAISES QUESTIONS ABOUT FDA ENFORCEMENT

Food Logistics

®

Global Supply Chain Solutions for the Food and Beverage Industry



HARNESSING THE POWER OF BIG DATA Understanding big data and how to convert it into profitability

CUSTOMER DEMAND DRIVES SUPPLY CHAIN INTEGRATION Consumer demands are raising expectations, but a more complex food supply chain means gaps still remain Issue No. 189 August 2017 FoodLogistics.com

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Since 1991

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LOGISTICS AN

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THE 12TH ANNUAL

TOP

Logistics

3PL & COLD STORAGE PROVIDERS Maintaining the cold chain is vital to protecting and meeting the demands of today's ever-changing supply chain. The companies on our 2017 list each play an important role in keeping up with that challenge.

Diverse in their capabilities and the customers they serve, each 3PL and cold storage provider continues to improve their expertise and keep up with the latest temperature monitoring technologies and systems.

Congratulations to these companies for ÂŽ their dedication.

Food

Logistics

Global Supply Chain Solutions for the Food and Beverage Industry

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THE F-650/F-750 /// FORD.COM

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ON THE MENU

OCTOBER 2015 ISSUE NO. 171

ON THE MENU

August 2017 ISSUE NO. 189

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COLUMNS FOR STARTERS

Celebrating Logistics Providers 6

Logistics providers are constantly evolving to meet the needs of their customers. One trend is clear: companies are increasingly relying on their logistics providers to serve as authorities in areas where a company may be lacking.

COOL INSIGHTS

Is a Truly Integrated Food Supply Chain Achievable?

Consumer demands are raising expectations, but a more complex and highly perishable food supply chain means gaps still remain.

FEATURES THIRD-PARTY & REFRIGERATED LOGISTICS

Industry Prepares for FSMA Enforcement 26

As final rules continue to roll out, the food industry is raising questions about how the FDA will proceed with enforcement of the Food Safety Modernization Act.

SECTOR REPORTS

The annual award provides an up-to-date list of the industry’s top providers, with a summary of their capabilities.

FOOD (AND MORE) FOR THOUGHT

New Robotics Impact the Future of Distribution

68 Craft Beer on Thin Ice: Cold Chain Opportunities in the US-Mexico Border Region

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To improve warehouse and distribution center productivity, adaptability and safety, companies are providing new robotics offerings.

TRANSPORTATION

Reefer Trailers and Containers: The Way of the Future

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As the food supply chain continues to respond to the FSMA transportation rules, four companies are paving the way for the future of food distribution.

SOFTWARE & TECHNOLOGY

60 Harnessing the Power of Big Data

Understanding big data and how to convert it into profitability is a challenge many are still learning to overcome.

OCEAN PORTS & CARRIERS

2017

Thought leaders from throughout the food and beverage industry discuss the challenges, opportunities and future of the cold chain.

WAREHOUSING

SPECIAL REPORT

32 Food Logistics’ 2017 Top 3PL & Cold Storage Providers

Industry Experts Gather at Second Annual Cold Chain Council 16

COVER STORY

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A Dramatic Restructuring

Mergers and acquisitions make waves in the ocean carrier sector, while shippers remain cautious about the impact on perishable cargoes.

Mexican craft breweries are expanding, yet the lack of cold chain storage and shipping significantly slows the market beyond local transport.

DEPARTMENTS

Supply Scan 12 Food on the Move 67 Ad Index 8

WEB EXCLUSIVES • Supply Chain Trends: 3 Things You Can’t Ignore in 2017 foodlogistics.com/12348031

• How Payment Technologies are Disrupting the Food Industry foodlogistics.com/12351902

• FL’s Educational Webinar Series foodlogistics.com/webinars

Published and copyrighted 2017 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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www.foodlogistics.com

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THIS IS WHAT INNOVATION LOOKS LIKE. M E E T T H E L A T E S T P R E C E D E N T ®.

Since launching Precedent a few years ago we haven’t stopped working, and we’ve now made the best line of reefers on the planet even better. New, tougher skins that are now standard on every unit. Plus more enhancements designed to boost your uptime and improve your bottom line. All complementing the industryleading fuel efficiency and temperature control that Precedent is known for.

And as always, every Precedent model is backed by the unmatched service and support of the Thermo King dealer network. Stop in to your dealer today and see for yourself what nonstop innovation looks like. ThermoKing.com.

Thermo King is a brand of Ingersoll Rand. Ingersoll Rand (NYSE:IR) advances the quality of life by creating comfortable, sustainable and efficient environments.

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FOR STARTERS

FROM THE EDITOR’S DESK

g n i t a r b e l e C LOGISTICS PROVIDERS W SOWINSKI

e are all familiar with the sound advice: leave it to a professional.

That thought came to mind as we vetted this year’s Top 3PL & Cold Storage Providers list.

Reading through the applications provided the edit team with insightful glimpses as to how logistics providers are constantly evolving to meet the needs of their customers. One trend is clear, and that is food companies are increasingly relying on their logistics providers to serve as authorities in areas where a company may be lacking, whether it’s in-house supply chain expertise, regulatory compliance or some other specialized domain.

Obviously, it’s expected that logistics providers can provide basics such as warehousing, distribution and transportation.

But add e-commerce, regulatory compliance, temperature-controlled capabilities, and access to the latest software and technology to the list, and it quickly becomes apparent that today’s logistics providers are bringing exceptional value to the table.

Logistics providers are expanding their portfolios of products and services with some pretty impressive offerings, all designed to support the similarly growing demands faced by their customers.

As a side note, I tend to group cold storage providers under the broad

“logistics provider” list, simply because it’s not uncommon today for them to provide transportation and distribution/fulfillment services for their customers.

Compliance is one area where we really see food companies turning to their logistics providers for guidance, particularly with the Food Safety Modernization Act (FSMA). This legislation touches nearly every aspect of the food supply chain, and making sure a company is accurately interpreting the regulations and likewise staying compliant with them is challenging. Most logistics providers are committed to staying on top of the requirements, so they can therefore guide their customers accordingly. This provides tremendous support to the food industry at large, and ultimately to the end consumers who place their trust in a safe food supply chain.

We celebrate and congratulate the 2017 Top 3PL & Cold Storage Providers that earned a spot on this year’s list. Check them out starting on page 32.

Finally, you will notice a new name on the masthead this month.

John Yuva recently joined our team as editor for Food Logistics and its sister publication, Supply & Demand Chain Executive. Along with Assistant Editor Amy Wunderlin, we welcome him aboard.

Enjoy the read.

DETAILS

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 John Yuva jyuva@ACBusinessMedia.com Assistant Editor Amy Wunderlin awunderlin@ACBusinessMedia.com Senior Production Manager Cindy Rusch crusch@ACBusinessMedia.com Creative Director Kirsten Wiskus Audience Development Director 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 and West Coast) Carrie Konopacki (920) 542-1236 ckonopacki@ACBusinessMedia.com National Automotive Sales Tom Lutzke (630) 484-8040, tlutzke@ACBusinessMedia.com EDITORIAL ADVISORY BOARD Jaymie Forrest, Chief Supply Chain and Commercial Officer, ScanTech Sciences Inc. John Haggerty, Vice President of Business Development, Burris Logistics Robert A. Norton, Ph.D., Professor of Veterinary Microbiology, Public Health and Biosecurity, Auburn University; Coordinator of National Security Initiatives, The Futures Laboratory Jon Shaw, Director of Sustainability and Global Marketing Communications, UTC Climate, Controls & Security Smitha G. Stansbury, Partner, FDA & Life Sciences Practice, King & Spalding CIRCULATION & SUBSCRIPTIONS P.O. Box 3605, Northbrook, IL 60065-3605 (877) 201-3915, Fax: (847)-291-4816 circ.FoodLogistics@omeda.com LIST RENTAL Elizabeth Jackson, Merit Direct LLC (847) 492-1350, ext. 18; Fax: (847) 492-0085 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 CFO JoAnn Breuchel Digital Operations Manager Nick Raether Digital Sales Manager Monique Terrazas

Published and copyrighted 2017 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.

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

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www.foodlogistics.com

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2017

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SUPPLY SCAN

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

MITSUBISHI CATERPILLAR FORKLIFT CELEBRATES 25 YEARS OF MANUFACTURING

BBX CAPITAL ACQUIRES LARGEST SPECIALTY CANDY RETAILER

BBX Capital Corporation has acquired IT’SUGAR LLC for $57 million. Headquartered in Deerfield Beach, Florida, IT’SUGAR is the largest specialty candy retailer in the United States, with 95 locations in 26 states and Washington D.C. IT’SUGAR will operate within the BBX Sweet Holdings vertical, expanding the company’s retail confectionary footprint, which includes Hoffman’s Chocolates, to more than 100 locations.

BBX believes this acquisition further solidifies them as a leading player in the confection industry.

BBX Capital also plans to further expand IT’SUGAR by opening new retail locations in high traffic leisure locations.

Mitsubishi Caterpillar Forklift America Inc. (MCFA), a leading manufacturer of forklifts under the Cat lift trucks, Mitsubishi forklift trucks and Jungheinrich brands, celebrated a major milestone last month, marking 25 years In honor of the 25th anniversary of of quality material handling production and distribution.

Mitsubishi Caterpillar Forklift America, The company has continued to grow each year, expanding nearly 1,200 employees gathered in its 40-acre, Houston-based manufacturing facility and lift Houston to celebrate the occasion with a unique photo opportunity. truck products throughout North and South America.

“MCFA has undergone a remarkable transformation over the last 25 years,” says Ken Barina, president of MCFA. “From a small operation of 335 employees to the nearly 1,200 we have today, MCFA has continued to make significant strides in not only the Class IV and V internal combustion forklift market, but also in the electric segment with our innovative Class I, II and III warehouse products.”

Additionally, MCFA will celebrate the production of its 450,000th forklift later this year, marking another huge milestone for the company. The company also recently began a second expansion of its electric assembly building, doubling the amount of production space for electric forklift models on MCFA’s Houston campus.

CARD SECURE SMARTPHONE APP ELIMINATES ID THEFT FOR MOBILE, RETAIL AND ONLINE PURCHASES Sixteen billion dollars was stolen from 15.4 million victims of identity theft and fraud last year, up 16 percent over 2015. Encryption, tokenization and EMV chips have helped, but theft of credit/ debit card numbers was up 40 percent. Meanwhile, a new victim of fraud or identity theft is popping up every two seconds. With the proliferation of cyberattacks, debit/credit card and digital wallet purchases, consumers have not been secure from ID theft and fraud from smartphones or at the point-of-sale until now.

The new Card Secure app from Internet Promise Group is the first-ever platform that eliminates the transfer of consumer bank card data to merchants, point-of-sale terminals and smartphones when making purchases.

Multiple U.S. and global patents have been issued and are pending for Card Secure and Ultimate Card. Internet Promise Group plans to partner with payment processing companies and launch its products within six months.

NEW ON-TERMINAL REEFER SERVICE AREA OPENS IN CHARLESTON South Carolina Ports Authority has opened a new refrigerated container service area in the Port of Charleston, marking a $14 million investment to support growing cold chain business in the southeast.

A new six-acre refrigerated container service area at the Wando Welch Terminal features a 12-lane service canopy, on-site storage and staging for gen-sets and container washing stations.

Additionally, the port has four new five-story refrigerated container racks that provide 120 more reefer slots on terminal, bringing the port-wide total to 1,700 plugs. Four additional racks of the same size are under construction, slated for completion in January 2018.

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www.foodlogistics.com

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REDUCE COSTS & IMPROVE WAREHOUSE OPERATIONS

Intelligent Automation Makes the Difference Automation solutions from SICK help you meet increasing demands for food and beverage supply chain improvements. Our broad portfolio of sensors, automatic identification systems and safety solutions are flexible, scalable and help make your operations more intelligent. Implementing automation solutions from SICK can reduce supply chain costs, improve transparency, and enhance food and beverage distribution processes.

You’ll find SICK transforming logistics operations in all supply chains...from retail, to parcel, and food and beverage - for 70 years and counting. SICK is a global solutions provider located in your corner of the world.

From cold storage, sortation, order fulfillment, packaging and palletizing, you’ll improve food distribution through our flexible and cost-effective automation solutions. We think that’s intelligent. www.sickusa.com

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SUPPLY SCAN

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

IRON APPLE AND UFSTP COLLABORATE ON FSMA COMPLIANCE TRAINING AND SOLUTIONS FOR CARRIERS AND BROKERS

TransComply, manager of the Uniform Food Safety Transportation Protocol (UFSTP) program, and Iron Apple, a leading supplier of food safety compliance solutions for food transport, have agreed to cooperate to provide compliance training and solutions that help motor carriers and brokers comply with the U.S. Food and Drug Administration (FDA) Sanitary Transportation of Human and Animal Food (STF) rule and promote that compliance to the shipping community. Many shippers and brokers are insisting that all carriers, regardless of size, provide evidence that they comply with minimum standards.

FDA’s STF rule is one of several major regulations stemming from the Food Safety Modernization Act (FSMA). Carriers with more than $27.5 million in annual revenue were required to comply as of April 6, and all other carriers with more than $500,000 in revenue must comply by April 6, 2018.

Under the companies’ agreement, TransComply and Iron Apple will consult on the development of complementary services to carriers and brokers that transport perishable food regulated by FSMA. In addition, the UFSTP program will inform program applicants and prospects regarding Iron Apple’s solutions to help carriers comply with the various requirements of the FDA rule related to training, record keeping, equipment and operational management, trailer cleanliness, and temperature control. Iron Apple also offers a third-party verification and audit solution for carriers.

Likewise, Iron Apple will inform and promote the benefits of participating in the UFSTP program, a privately managed registry of carriers that have committed contractually to comply with the applicable requirements of the FDA rule. The UFSTP program’s primary goal is to ensure that compliant carriers of all sizes are recognized by shippers and brokers for embracing best practices in the safe handling of perishable food.

The Iron Apple certified food safety solution is aimed at motor carriers and brokers that are responsible for transporting food throughout North America, providing all procedures, policies, forms, employee training, workflow and documents needed for the company to meet regulatory requirements. A yearly review by a third-party auditing partner is completed to ensure all areas of the solution are being followed properly throughout the company. Carriers and brokers receive all materials needed to comply, reducing personal risk and increasing brand confidence.

Launched in December, the UFSTP program is being used by numerous brokers and shippers to vet carriers for perishable food loads in the spot market. Currently, more than 350 carriers have completed all UFSTP requirements and are listed as verified carriers at www.ufstp.com/verify.

AMAZON MOVES INTO MEAL KIT SPACE

Amazon is stepping up its assault on America’s $780 billion grocery market with plans to deliver meal kits to customers’ homes.

The internet retailer recently registered a trademark in the United States for a new service called, “We do the prep. You be the chef.” It will cover “prepared food kits…ready for assembly as a meal,” according to its application.

The move comes just weeks after Amazon splashed out $13.4 billion on Whole Foods Market. The acquisition was chilling for the U.S. food retail industry, which Amazon has so far failed to crack.

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NEW ONLINE GROCERY STORE DITCHES BRAND NAMES A new online grocery store is setting itself apart by ditching fancy labels and complex price tags. Brandless, a San Francisco-based startup, sells everything from snacks and meal kits to toothpaste and cleaning supplies at the same price: $3 per item.

All of the inventory comes in spare, generic packaging marked only with an individualized checklist of moral or health-conscious “values.”

Each of the products also comes straight from the manufacturer, and then is shipped directly to customers, cutting out the wholesalers, vendors and shippers that add their own costs to the retail supply chain.

FEDEX STILL REELING FROM JUNE CYBERATTACK

Package delivery company FedEx says its fiscal 2018 results will be hurt, in part due to disruption of operations in its TNT Express unit following a cyberattack in June.

The Netherlands-based TNT Express is still experiencing widespread service delays following the attack, FedEx said in a regulatory filing last month. The company was unable to say when services at the unit would be fully restored.

In June, a new cybervirus spread from Ukraine to wreak havoc around the globe, crippling thousands of computers.

FedEx said it has experienced loss of revenue due to decreased volumes at TNT Express, incremental costs from contingency plans and remediation of affected systems.

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FOOD ON THE MOVE

LOGISTICS TRENDS IN OUR INDUSTRY

CX NORTH AMERICA RELEASES FREIGHT VISION MOBILE APP

CX North America Information Services Inc., a leader in freight collaboration solutions for the transportation industry, has released a Freight Vision Mobile App, a new product designed to give a range of users, especially at the management level, visibility over the status of their freight operations anytime, anywhere.

Nicknamed the “4 a.m. App,” the Freight Vision Mobile App recognizes that key business activity frequently occurs outside of normal business hours. During off-hours away from the office, managers lack connectivity with the systems version of Freight Vision and the operations staff who often provide them delivery status updates. The mobile app fills this gap by delivering real-time status information over their smartphones or other mobile devices on demand.

The Freight Vision Mobile App delivers information related exclusively to drivers and shipments already in the system. It does not, for example, allow new deliveries to be scheduled, however.

DRIVEWYZE’S NORTH CAROLINA EXPANSION FEATURES MORE BYPASS OPPORTUNITIES

When Drivewyze expands its number of active sites in North Carolina this month, the weigh station bypass service will be available at a total of 16 locations in the Tar Heel State.

Joining its service network of nearly 700 weigh stations and inspection sites across the United States, the expanded sites in North Carolina will be located on all interstate routes across the state, including U.S. Interstates 26, 40, 77, 85 and 95.

John Pope, chairman of the privately-held Cargo Transporters, which is based in Claremont, North Carolina, says one big advantage of having Drivewyze on its electronic logging devices: the company no longer must manage and track transponders.

“With more bypass opportunities in our home state, and the debut of South Carolina late last year, our drivers can utilize even more of their electronic logging device (ELD) driving hours,” Pope says. “And that means our drivers are more likely to stay on schedule and deliver their loads on-time with more consistency.”

Drivewyze also provides a free analytics weigh station loss reporting tool to help fleets determine how much they can save before activating the subscription-based weigh station bypass service.

DAT SOLUTIONS’ MONTHLY FREIGHT REPORT

A Chart-Topping Performance Mark Montague is an industry rate analyst for DAT Solutions, which operates the DAT network of load boards and RateView rate-analysis tool. For information, visit www.dat.com.

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We’ve been producing our DAT North American Freight Index for nearly 20 years, and one reliable trend is how spot truckload freight activity picks up in the second quarter and then tapers off after the Fourth of July holiday.

It’s holding up in 2017.

The June DAT Freight Index increased 24 percent over May, capping a robust second quarter. The number of refrigerated freight posts was up 23 percent compared to May and 66 percent year-over-year. Van freight activity jumped 35 percent and 68 percent, respectively.

Brokers and shippers paid a premium for capacity. The national average reefer rate was up 10 cents to $2.12 per mile compared to May, while the van rate gained 11 cents to $1.80 per mile. Compared to June 2016, spot van rates

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By Mark Montague

are up 11.3 percent, and the impact is being felt in contract rates, where the average rose 3.6 percent year over year.

By mid-July, however, reefer volumes were down, in part due to triple-digit temperatures in the Southwest, produce yield cuts, and average spot rate declines in markets like California and central Florida, especially for hauls longer than 450 miles.

After spot truckload freight activity rallied to record highs and national average rates reached their highest points in two years, the trendline is moving as expected in 2017. It’s just positioned higher on the chart this year. www.foodlogistics.com

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“We’re going with Worley.” y t e

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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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FOOD ON THE MOVE

LOGISTICS TRENDS IN OUR INDUSTRY

NEW INVESTMENTS HELP TOTE MARITIME MAINTAIN THE MOST MODERN FLEET IN THE TRADE

TOTE Maritime continues its tradition of machine-to-machine (M2M) leadership in the shipping industry with its purchase this year of 350 new hightech smart refrigerated containers to service the Puerto Rico trade route.

TOTE Maritime was among the shipping industry’s pioneers in using M2M telematics technology to remotely monitor and control conditions of refrigerated perishables during transport.

Since 2011, TOTE Maritime has deployed Orbcomm’s StarGuard system to monitor and control its refrigerated containers, or reefers, from point of origin to destination. The monitoring maximizes safety and efficiency of supply chain operations while providing clients crucial real-time, end-to-end visibility of their shipments in TOTE Maritime’s cold chain.

TOTE Maritime’s entire reefer fleet is now equipped with the StarGuard system. The fleet now will also utilize ORBCOMM’s new GMS-based VesselConnect M2M application, securely providing critical real-time data from reefers. The new technology allows TOTE Maritime to monitor set points, conduct pre-trip inspections on-board and expedite cargo distribution on land. VesselConnect also provides the precise monitoring and record-keeping needed for compliance with the new requirements of the FDA’s Food Safety Modernization Act being implemented this year.

CAMPBELL SOUP TAKES A PAGE OUT OF AMAZON’S PLAYBOOK

Of all the changes announced in the past few weeks by the Campbell Soup Co., the most revealing one is this: the company has hired a former Amazon executive to lead a new e-commerce division.

The 148-year-old soup company wants to sell more food over the internet, and it’s relying on Shakeel Farooque, who held a range of roles at Amazon before taking jobs at eBay and Kohl’s, to help it figure out how.

The strategy will almost certainly include taking advantage of Campbell’s $10 million investment in meal-kit company, Chef’d, and its $32 million investment in Habit, a high-tech meal kit company that designs customers’ diets by analyzing their blood. It also will involve building a network of new distribution centers— the first ones will be in California and Texas— dedicated to online orders, the company said at an investor conference.

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HIGHLIGHT OPENS TERMINAL IN LOS ANGELES AREA

Highlight Motor Group’s U.S. division has opened a terminal in La Mirada, California, to provide consolidated less-than-truckload and full truckload service between Canada, the eastern United States and the Los Angeles area.

“Our La Mirada terminal is a direct response to customers telling us they want more options, better service and faster transit times to and from this region,” says Kirk Kalinitchenko, president of Highlight Motor Group Inc. “Having a physical location here with a staff who truly understands the market is a distinct advantage for us and for our customers.”

The La Mirada terminal gives Highlight Motor Freight USA a coast-to-coast presence in the United States and allows Highlight Motor Group to establish a higher level of direct service between Los Angeles and key markets in Canada. Highlight Motor Freight USA also operates a terminal and warehouse in New Jersey.

UBER’S SURGE PRICING NOW A FOOD DELIVERY STAPLE

Everyone hated surge pricing when Uber first added it to rides. Now surge is becoming ubiquitous among food delivery startups, too.

Postmates has “blitz pricing,” and Sprig, before it went out of business, charged more to deliver during busy times. Uber brought surge pricing to UberEats late last year, and in recent months, DoorDash has quietly begun testing dynamic delivery fees as well.

DoorDash is one of several Silicon Valley startups jockeying to deliver food from restaurants and items from convenience stores. Venture capitalists have poured billions into these startups in recent years in hopes of catching the next big on-demand success story—Uber, but for food. www.foodlogistics.com

8/2/17 3:49 PM

SOLUTIONS AS FRESH AS A PEACH Burris Logistics is growing with an all-new 250,000 SF public refrigerated warehouse in McDonough, Georgia.

This temperature-controlled, 28,000 pallet position facility offers partners even stronger cold chain solutions.

Contact us for more information and let us WOW! you.

John Hochmuth, VP of Sales jhochmuth@burrislogistics.com 919.394.5100 or Michael T. Pitcher, Sales Director mpitcher@burrislogistics.com C. 860.471.4440 | O. 904.265.5990

B U R RIS L O GIS T ICS . CO M

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COOL INSIGHTS

BY AMY WUNDERLIN

INDUSTRY EXPERTS GATHER

AT SECOND ANNUAL COLD CHAIN COUNCIL Thought leaders discuss the challenges, opportunities and future of the cold chain.

T

he second annual Cold Chain Council, hosted by Q Products and Services, brought together thought leaders from each part of the cold chain.

The educational forum, held June 13 in Chicago, featured several panels, presentations and a roundtable discussion, and was moderated by industry veteran Michael Cole.

The forum’s first panel, “Delivering Fresh Margins in Today’s Complex Cold Chain,” included presentations from Gary Campisi, senior director of quality control, Walmart; Luke Gowdy, general manager, sourcing transportation, C.H. Robinson; and Rob Ondrus, director of produce, Reinhart Foodservice.

Of particular interest was Campisi’s presentation describing the difficulty of transporting fresh foods, specifically in regard to L A U N THIRD ANHAIN tropical fruit. The demand for C D L CO such commodities like avocaCOUNCIL dos, papaya, bananas, guava & SERVICES TS UC OD Q PR ON WILL HOST and mangoes has significantly increased in the last few years, presenting a number of shipping challenges.

Walmart tripled its sales in mangoes in 2016 compared to 2015, and Campisi says some are predicting mangoes will eventually overtake bananas in sales.

Shipping tropical fruits in mixed loads is especially difficult because Some of the cold chain requirements for the biggest tropical fruit limit compatibility opportunities with other products. Most tropical are now in commodities require warmer shoulder transit temperatures no colder than seasons.” about 50 degrees.

The retail giant is seeking addiJon Davis, meteorology team lead, Riskpulse tional solutions to its tropical fruit

6/25/18

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dilemma, hoping for further lowweather trends, data analytics and cost technology in packaging, such the solutions Riskpulse can provide as Q Products PalletQuilt, which in regard to weather and climate in was designed to protect individual the logistics world. pallets of produce commodities Riskpulse applies weather to traveling in varying trailer tempera- things, beginning with raw data. ture zones.

Their solutions have played a big “We can only get by for so long part in the agriculture and energy with blankets and quilts and hoping industries for years, but are now for the best,” Campisi adds. seeing more applications throughout Presenters in the secthe supply chain. ond panel, “Cross Border Davis walked the Capacity Crunch: Finding audience through the Right Mix for Seasonal historical weather Demands,” included: Gary trends over the last Olson, president of brew50 years, showing a ery operations, Minhas global trend toward Brewery; Kelli Saunders, warmer and extreme president and CEO, weather.

Morai Transportation; and “The spread has Stephen Mollard, director widened out, which is CAMPISI of intermodal, Canadiextremely important an National. The panel in logistics,” he notes. provided perspective on The reason the challenges associated for this warming, with securing temperature Davis explains, is sea controlled capacity out of surface temperaMexico and into Canada. ture anomalies. The Also speaking was anomalies indicate DAVIS Brandon Clark, global that the summer of transportation manager 2017 will be one of at Amway. His presentation fothe hottest ever, bringing increased cused on transportation challenges risk of heat- and humidity-related and opportunities in a global transportation and shipment issues supply chain. and an increased demand for temJon Davis, meteorology team perature-sensitive products. lead at Riskpulse, touched on a Extreme weather trends create sometimes controversial topic— huge differences in trade lanes, climate change—and its effects on but also bring potential for new the supply chain. Titled, “Climate openings throughout the year.

Trends and Supply Chain Logistics: “Some of the biggest opportuniA Changing World,” the presenties are now in shoulder seasons,” tation explained how changes in says Davis. “Novembers are comweather patterns are creating both pletely different than they used to challenges and opportunities for be. The extremes that we see bring logistics providers. up opportunity and a potential to Davis discussed historical earn cost savings.” www.foodlogistics.com

8/4/17 10:59 AM

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COVER STORY

BY ALEXANDRA WALSH

IS A TRULY INTEGRATED FOOD SUPPLY CHAIN ACHIEVABLE? T

Consumer demands are raising expectations, but a more complex and highly perishable food supply chain means gaps still remain.

he food supply chain is constantly evolving, but has there ever been a time when it has been more rocked by change? Can visibility and traceability—the bedrock of effective and safe food logistics—keep pace with the breakneck speed with which globalization, e-commerce, technology and simply the way people now buy food are transforming the food supply chain?

Logistics, transportation, and software and technology providers each have their own perspectives, yet one thing they all agree on—the acquisition of Whole Foods by Amazon could be a game changer for food logistics.

Medearis points out that on the front side, when fruit or other perishables come into one of Americold’s facilities, safeguards are in place to ensure product quality, temperature integrity, and federal and state regulatory compliance are adhered to—for example, quality control teams check the temperature and pressure of fruit.

Similarly, there are processes in place as those orders of fruit exit the facilities.

“The challenges can arise if we’re not managing the distribution for our customer when the product comes out of the cold storage facility and heads into transit to its final destination,” says Medearis.

“The retailer will check the product again upon receipt, but when consumers are buying from an online site—how do you ensure freshness and no contamination on that last leg? I see that as both the next big challenge, as well as the future, for our industry—ensuring the quality and integrity of products purchased online, from end to end, so that the consumer is as content as if they’d personally selected each item.”

When it comes to visibility and traceability, Medearis affirms that there is amazing technology now to track products. “With a click of the mouse or the tap of a smartphone screen on our i-3PL Supply Chain Control portal, you know where

The Warehouse

Alexandra Walsh is a freelance writer and editor based in Bethesda, Maryland, who specializes in industry issues and trends. She is also the lead writer and managing editor of Cold Facts magazine, published by the Global Cold Chain Alliance (GCCA).

18

“Amazon’s acquisition of Whole Foods is a big leap in the public’s perception of the integration of e-commerce in the farm to fork of the food supply chain,” comments Ben Medearis, director of business development for Americold.

“Behind the scenes, food and beverage supply chains have been transformed by the Internet of Things (IoT) over recent years.

Integrating innovation in a timely fashion, and in a way that continues to promote safety, is an ongoing opportunity for companies like ours,” he says.

In addition, Medearis notes that customer demand for products year-round is increasing demand for a globalized food supply chain, which means increased imports and exports. Even inland facilities are dispatching product via the road and rail to ports and airports, as American food producers send their goods abroad.

FOOD LOGISTICS | AUGUST 2017

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www.foodlogistics.com

8/4/17 8:32 AM

your trailer is and that your order is on its way.”

Nevertheless, despite available technology, perceived hazards remain in online food delivery. “If you partner with a large carrier to deliver meal kits, then thousands of these individual meals are going to be delivered to thousands of homes, and each one has to be accounted for and packed in dry ice or some method to ensure the products remain fresh and no one gets sick. It’s our responsibility to provide reassurance to ensure that the customer trusts all will be okay,” adds Medearis.

The Carrier Realizing there was an opportunity to penetrate the transportation logistics marketplace and create new revenue streams, the Canadian National Railway (CN Rail) purchased 100 53-foot refrigerated cars in 2013, and launched CargoCool. Today, CN operates 720 reefer units across North America, with 21 intermodal terminals, five logistics parks and rail connections

to three coasts and six major ports.

“We have the ability to connect each end of the global cold supply chain through transload, rail and truck, commonly known as intermodal and transmodal, whether import or export, from farm to vessel to port to rail to storage,” explains Kerwin Belle, CN commercial manager. “Today, consumers want access to food products grown around the world, so we enable tangerines from Morocco to travel all the way across the Canadian supply

chain without interrupting the cold chain cycle.”

In order to track shipments door to door, CN Rail employs tracking technology that allows a dedicated team of subject matter experts to monitor cargo in transit for up-tothe-minute information and change the set point temperature remotely when required.

“Units are GPS tracked and have telematics installed in them that allow our reefer desk to observe the temperature of the load, fuel levels, ambient temperature and original set point,” notes Belle. “Whether it’s our domestic or international program, our web-based and software programs give us what we believe is the most efficient and accurate real-time feedback, by commodity, on what’s going on inside the box,

Sensitech’s TempTale Geo, shown left, provides realtime temperature and location monitoring.

www.foodlogistics.com

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AUGUST 2017 | FOOD LOGISTICS

19

8/4/17 8:32 AM

COVER STORY

continued

Customers as well as the ability to capture want to track cargo historical data.”

Belle adds that CN Rail investin real time. The good news is ed a great deal of time in market technology research to ensure the reefer team knew exactly what is evolving desk temperatures were required for at breakneck specific commodities and how speed.” tolerant those commodities were Grant Woolf, to temperature fluctuations before vice president, Sensitech quality was affected. “The reefer desk team specializes in perishable commodities and focuses all its efforts to ensure product integrity by the time those commodities get to their destination.”

CN Rail is not complacent about the growth CargoCool has enjoyed, which has been somewhat more than anticipated, and is focused on making more capacity available and ensuring equipment is up to industry, Food Safety Modernization Act (FSMA) and Hazard Analysis Critical Control Point (HACCP) standards. “We want to make sure our equipment is always food grade quality to guarantee continued measurement of product that could end up on our own table,” Belle points out.

“Our vision is to continue to grow and develop the industry, to main-

tain the highest standards in the cold chain and move product safely, on time and damage free to ensure quality both during transit and after delivery,” he concludes.

The Technology “As consumers, our best experience becomes the standard by which everything else is measured,” says Grant Woolf, vice president of business development and strategy for Sensitech Inc., a global leader in delivering supply chain visibility solutions. “Today’s customers expect that products of all types are tracked in real time. They are accustomed to the visibility provided by the tracking technology available now, and expect deliveries to be on time.”

Trucks and trailers with telematics are able to address on-time delivery challenges, both inbound and outbound. They can provide real-time visibility to shipments in transit, accurately measure logistics performance and drive improvements, according to Woolf. This works particularly well when logistics providers have their own fleet and can track their own shipments.

“But if you’re outsourcing or using a broker, which is often the case today, you may not have the same carrier two days in a row,” he says. “Even if the truck shows up

BLOCKCHAIN OFFERS SECURE SUPPLY CHAIN INTEGRATION foodcareplus, a Belgium logistics service provider that specializes in the delivery and distribution of quality food products, has developed an all-in-one international supply chain security monitoring service for the food industry. Combining its shipping execution services with monitoring and blockchain technology, foodcareplus will be the first specialized logistics service provider to offer an integrated food trading and shipping platform, providing trust throughout the food supply chain.

The intercontinental distributor’s current freight management platform already provides real-time temperature, location and security monitoring of food products shipped. With the addition of blockchain technology, a completely integrated food logistics and shipping platform is envisioned, allowing perishable item shippers and buyers to have even greater visibility into their supply chain.

By applying blockchain technology, digital product information, such as origin, batch numbers, expiration dates, factory information, storage temperatures and shipping details, will be collected in a so-called “passport” on foodcareplus’ platform.

Most temperature monitoring solutions and traceability tools available on the market are managed separately from the harvest, packing and shipping processes, while foodcareplus now can integrate the temperature and location data with all the shipment movement data.

20

FOOD LOGISTICS | AUGUST 2017

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with telematics capability aboard, the logistics team may not be able to integrate the telematics data for that shipment. There is no common cloud system that can connect that truck to you.

“Customers want to track cargo in real time. The good news is that technology is evolving at breakneck speed,” Woolf adds. “As the cost of real-time technology goes down, more customers will track in real time, which will increase logistical efficiencies.”

With globalization, consistency is critical to help ensure continuous supply chain visibility.

“Supply chains that involve multiple third-party transportation vendors, and increasingly cross multiple borders, moving from production to customers, present a real challenge for brand owners.

You can only manage it if you can see it, and as product shipments get handed off from one 3PL to another, product owners can’t easily see and manage the process,” says Woolf. “Said differently, shipments rarely stay in the hands of a single vendor as they move around the world. What the brand owner seeks is full visibility across all supply chain partners. Up to this point, it has been a challenge.”

The Sensitech executive adds cellular-based tracking devices (using cell networks) link real-time tracking with real-time temperature monitoring to see things as they happen. “The metrics will tell you that the delivery is going to be late, and the data will tell you which carriers and routes are doing well and which origins or destinations are problematic. Now the customer can sit down with their 3PL and carriers to solve the problems and drive efficiencies.”

Woolf adds: “Everyone wants to track their cargo, the issue is the expense. As both a service company and a manufacturer of tracking devices, our approach is to drive costs down in order to get more shipments tracked. Whoever tracks cargo most efficiently will win the battle.” www.foodlogistics.com

8/4/17 8:32 AM

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8/4/17 8:32 AM

SPECIAL REPORT

BY LARA L. SOWINSKI

PORT TAMPA BAY PARTNERS WITH PORT LOGISTICS REFRIGERATED SERVICES ON

NEW COLD STORAGE FACILITY F

Florida’s population growth and rising tourism are driving demand in the food and beverage sector.

22

lorida is one of the fastest growing states in the nation, and the third most populous. It’s also a top destination for tourists, with 125 million expected to visit the state this year. Many of those visitors will spend time in the Orlando and Tampa Bay areas, says Wade Elliott, vice president of marketing and business development at Port Tampa Bay. Not surprisingly, the strong population growth and rising tourism are driving demand in the food and beverage sector. This is especially good timing for the opening of a new cold storage facility operated

by Port Logistics Refrigerated Services (PLRS), located at Port Tampa Bay, which is helping support the agricultural community, importers and exporters, foodservice providers, grocers and others with an unparalleled value proposition in the ever-expanding global food supply chain.

The region is already a major hub for the grocery and food and beverage sector, explains Elliott.

Publix, one of the 10 largest supermarket chains in the United States, is headquartered in Lakeland, Florida, and operates large distribution centers (DC) there

FOOD LOGISTICS | AUGUST 2017

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and in eight other cities throughout the state, as well as Georgia and Alabama. Sysco’s International Food Group, Walmart/Sam’s Club, Goya, Southern Wine & Spirits and others also have a presence in the I-4 Corridor that runs east to west through central Florida, from Tampa to Daytona Beach.

The port’s location in the middle of the state makes it feasible for truckers to make three daily round-trips to major grocery DCs along the I-4 corridor and stay within the requirements of the hours-of-service regulations.

Trucks also can reach Atlanta and the Carolinas within one day’s drive from the port.

As for the new PLRS facility, Elliot says that from the port’s perspective, it’s “definitely a big deal” and “a really good fit with our continued diversification of our different lines of business.”

Port Tampa Bay has been making a number of strategic investments to support its diversified business portfolio, which includes food and beverage. For example, the port’s close proximity to Central and

 Port Logistics Refrigerated Services designed the new cold storage facility to handle both breakbulk and containerized cargo.

South America, including Mexico, provides an obvious advantage for importers and exporters.

According to Elliott, the port is still exploring all the trade potential associated with Mexico alone.

“We’ve already seen some pretty sizable growth in that trade lane over the past year,” he says, noting that the all-water option from Mexico to Port Tampa Bay is faster and more cost effective compared to truck or rail transportation.

In addition, the port installed two new post-Panamax gantry cranes last year, allowing it to accommodate vessels up to 10,000 TEUs. Increased trade with Asia presents another opportunity for the port, particularly for citrus products and juice, while Sysco International Food Group’s restaurant-related exports to Latin America, the Caribbean, and even the Middle East and Asia is another area that could see expansion as the port continues to enhance its perishable cargo handling capabilities.

Rick Sharp, vice president of business development and operations at PLRS, says the new facility offers a host of features that truly set it apart from other facilities.

For starters, it’s designed to handle both breakbulk and containerized cargoes, which is very attractive with the current rate hikes on containerized cargo. It also makes it easier for shippers to expedite their palletized cargo coming off a breakbulk vessel straight to a regional DC. For reefer containers, the facility has 96 reefer plugs and a 100-ton crane to handle containers.

A separate temperature-controlled fumigation building can treat product quickly and safely, www.foodlogistics.com

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SPECIAL REPORT

We see food and beverage as key drivers of cargo growth at the port, both containerized and breakbulk, going forward.”

Wade Elliot, Port Tampa Bay

continued

as opposed to fumigating in a large warehouse that is not temperature-controlled. The dedicated fumigation building uses highspeed fans to rid the building of gas within five minutes, so employees can move the product back into containers or trailers and deliver to the customer in a timely manner, eliminating hours from the process.

Sharp says there are other features that make the PLRS facility state-of-the-art. A 22-pallet-deep, gravity-fed racking system guarantees freshness with first in, first out inventory management.

Furthermore, the facility uses a glycol-based cooling system, as opposed to ammonia, which is much safer for employees and food and beverage products.

“Ammonia is very harmful to humans and products. If it comes in

contact with a product, the product becomes contaminated and must be thrown out,” says Sharp.

The glycol-based cooling system is more costly to install upfront, but in the long term, it runs more efficiently and uses less electricity, he notes.

In order to accommodate a wide range of perishable products, the facility can be sectioned into seven different temperature zones. Some of the rooms are racked, some are not, and can be used to support packaging operations. Sharp also has received some customer inter-

est for a ripening room for bananas, which is another potential use.

The various temperature zones also provide flexibility and support for product inspections conducted by the United States Department of Agriculture (USDA) and Customs and Border Patrol. In fact, the facility design provides about 2,000 square feet of space for inspectors and government officials “with all the latest technology, cameras, labs, shelving and even garbage disposals…everything they needed we provided,” says Sharp.

The PLRS facility is part of a

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8/4/17 8:32 AM

multi-phase project at Port Tampa Bay, explains Elliot, with the next phase involving an express rail connection between the port and the Midwest. Discussions are underway with rail partner CSX, while the rail infrastructure itself is already in place at the port.

The goal is to optimize the transportation of time- and temperature-sensitive cargoes. For example, an import reefer container of pineapples could be transloaded at the port directly into a refrigerated rail boxcar, making the reefer container available for an export shipment right away and avoid having it railed to Chicago.

An express rail service could handle both import and export business to and from the Midwest in addition to domestic perishables that have a market in Florida and vice versa, explains Elliot.

Finally, phase three of the project would be the development of a “food campus” for dry or ambient

products and additional refrigerated warehousing for storage, packaging and distribution of perishable food and beverage products.

“We really see food and beverage as one of the key drivers of cargo growth at the port, both containerized and breakbulk, going forward,” emphasizes Elliot.

Without a doubt, the new PLRS facility, combined with the strategic

initiatives taken by Port Tampa, are impressive. What stands out, however, is that it’s a favorable mix of factors—the right timing and investments, growing demand, geographic location of the port and state-of-the-art PLRS facility—that work in unison to offer an unbeatable solution for supporting the expanding food and beverage supply chain.

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AUGUST 2017

| FOOD LOGISTICS

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8/4/17 8:33 AM

3PL: FSMA COMPLIANCE

BY LARA L. SOWINSKI

INDUSTRY PREPARES FOR FSMA ENFORCEMENT T

The food industry is raising questions about how the FDA will proceed with enforcement of the Food Safety Modernization Act.

26

he substantial rules that comprise the U.S. Food and Drug Administration’s (FDA) Food Safety Modernization Act (FSMA) are not only a game-changer in terms of how the industry must adapt its procedures, operations and recordkeeping to ensure a safe food supply, but it also raises the stakes for penalties and fines that are associated with non-compliance of the FSMA’s rules.

To be fair, enforcement is still in the early stages as the FSMA continues to roll out. For instance, the final rule for the Sanitary Transport of Food (STD) was issued in April. For that reason, importers, shippers, transporters and others

FOOD LOGISTICS | AUGUST 2017

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who are impacted by FSMA are understandably searching for reliable guidance as to how officials from the FDA and other state and federal agencies will proceed with respect to enforcement. However, legal experts and others say there are more unknowns than certainties.

Dr. Robert A. Norton, professor of veterinary microbiology, public health and biosecurity at Auburn University, assesses that, “FSMA is so new that everyone, both inside and outside of government, is struggling with it.” Interpretation of the law is difficult, he says, “Because we don’t have a lot of precedent.”

There also is no disputing, he adds, that the current administration is very different from the last. “There has not been sufficient time for the changes that may be made to be implemented. We also haven’t yet seen litigation or the appeals to know exactly where all this is going.”

However, Norton does expect that criminal prosecutions are likely to become more common. When asked about his thoughts on the deadly 2008-09 Salmonella outbreak blamed on Peanut Corporation of America, which resulted in federal

prison terms for chief executive officer Stewart Parnell and several other senior executives, he agrees that these are examples of The very aggressive industry will prosecution that see a gradual were initiated clarification by the previous of where administration— the FSMA something he is enforcement uncertain will is going continue as we in the move forward. next 12-18 According to months.” a conversation that Norton Robert A. Norton, professor at had with an Auburn University employee of the U.S. Department of Agriculture’s (USDA) Food Safety Inspection Service (FSIS), staffing at both the FDA and USDA is “very much in a state of confusion.

“Many billets remain open.

Coordination, or lack thereof, is being blamed on a poorly executed transition from both administrations,” he says.

Norton does expect the industry to see a gradual clarification of where enforcement of the FSMA is going in the next 12-18 months, “but certainly not a major clarification.

“What is accomplished will be entirely dependent upon how rapidly the empty leadership slots are eventually filled,” he continues. “The current administration is complaining loudly about impediments being put in front of nominations, which in turn impedes the pace at which the FSMA will be implemented and interpreted.”

Norton acknowledges that, putting all politics aside, the complaints

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3PL: FSMA COMPLIANCE

continued

LEVERAGING A BIG PICTURE

PERSPECTIVE TO BOOST REGULATORY COMPLIANCE

A lot of people are claiming to be FSMA experts,

but there is no such animal.”

Robert A. Norton, professor at Auburn University

do seem to be largely justified, as nominations have been made, but are not being reviewed or approved at the pace at which they were done previously.

He adds, “When asked, I tell everyone that we are unfortunately in a ‘wait and see’ mode. Lots of people are claiming to be FSMA experts, but honestly, there is no such animal. We will only know the details of the FSMA if the fullness of time.”

Indeed, there is even some evidence of discrepancies amongst FDA officials as to the interpretation and enforcement the FSMA. Dr. David Acheson, founder and CEO of The Acheson Group, says there are field reports that suggest some inspectors are making incorrect interpretations of the FSMA. “I think there are definitely inspectors who are exerting the authority they have—their new authority—and being pushy about it.”

Presently, it’s a “mixed bag,” he says, explaining that some inspectors are proceeding more gently with regards to enforcement, while others have “suddenly realized they’ve been given a big stick, and they’re going to use it. So, it’s unpredictable and inconsistent.”

Education over Regulation Nonetheless, Acheson says the prevailing attitude at the FDA with regards to FSMA is to “educate more than regulate.”

As for outreach to the trade

28

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FLOG0817_26-31_3PLFSMA.indd 28

Some companies find that their logistics providers are among the best resources for helping to assure compliance with the Food Safety Modernization Act’s (FSMA) regulations.

Armada, a 4PL offering fully integrated supply chain solutions, leverages its comprehensive and holistic view of supply chains to provide individual clients with valuable insight on how best to manage the evolving regulatory compliance requirements.

A big picture perspective means Armada is continuously gathering considerable insight and information from multiple clients as to how the FSMA is impacting the food industry across a broad spectrum of stakeholders, and applying it to each client’s specific needs.

Steve Kinney, vice president, warehouse operations, says Armada’s subject matter experts provide measurable value to clients who are seeking high-level expertise from their logistics partner. Moreover, the 4PL actually started conducting its own risk assessments years ago that helped it stay well ahead of the food safety regulations that eventually manifested in the FSMA. “We really got ahead of the regulations,” says Kinney. “By the time the FSMA came along, we were already down the food safety path with all of our clients.”

A lot of focus is placed on temperature control, he adds, making sure that clients’ cold chains are intact and monitored during every stage, including warehousing, distribution and transportation.

The ability to monitor the cold chain at a granular level results in multiple benefits for clients. Not only does it assure regulatory compliance and improved food safety, “clients can also make better quality decisions about their shipments, which extend shelf life and reduce waste,” says Kinney.

Armada’s access to end-to-end information from a variety of clients and supply chains boosts regulatory compliance in other ways. “We act as an advocate, ensuring that our clients are educated and compliant,” says Kinney, referring to meetings that Armada conducts with clients’ quality teams to help them design and customize supply chain solutions.

Ultimately, the strategic role that Armada creates with its clients has elevated awareness related to regulatory compliance, while supporting food safety throughout the food supply chain.

community to help with education, the FDA has conducted events to raise awareness and understanding about the FSMA. But because they have a limited budget and staff, Acheson explains, overall the effort still misses a vast number of people.

There are online resources, including fact sheets, FAQs and guidance documents for the trade,

he adds, but some are very lengthy and sometimes hard to understand.

Trade associations and industry groups are another source of information, albeit sometimes limited.

Not surprisingly, the smaller companies and/or those that cannot afford to hire consults to help interpret the FSMA are at a disadvantage compared to larger www.foodlogistics.com

8/7/17 9:00 AM

firms with more financial and legal resources.

Unfortunately, “They just have to struggle with it [interpreting the FSMA] and hope for the best,” advises Acheson. “I do think it’s a gap, but it’s not an unexpected one and it’s not the result of malevolence or not caring.

It frankly comes down to budget and lack of funding.”

As for how the FDA might utilize its staffing and resources to enforce the FSMA, it may be that the agency will implement risk-based programs to help them focus on companies and others that require greater scrutiny, while those that demonstrate high levels of compliance would be subject to less intervention.

For example, U.S. Customs and Border Protection’s C-TPAT (Cus-

www.foodlogistics.com

FLOG0817_26-31_3PLFSMA.indd 29

toms-Trade Partnership Against Terrorism) program, launched in 2001, is a voluntary program that allows importers, carriers, customs brokers and manufacturers

to become certified by CBP in exchange for being considered “low risk,” and therefore less likely to be targeted for an examination at a U.S. port of entry.

Similar to C-TPAT is the FDA’s Voluntary Qualified Importer Program (VQIP), which is a voluntary, feebased program for the expedited review and importation of foods from importers who achieve and maintain a high level of control over the safety and security of their supply chains.

Acheson expects that FDA will continue to use risk-assessment tools to help prioritize inspections.

Meanwhile, Frank Ahern, corporate director of safety, health and

AUGUST 2017

It’s important for any company to stay proactive

when it comes to compliance.”

Frank Ahern, corporate director of safety, health and environment at Burris Logistics

| FOOD LOGISTICS

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8/7/17 9:00 AM

3PL: FSMA COMPLIANCE

continued

environment for Burris Logistics, concurs that right now there are many unanswered questions regarding enforcement of the FSMA.

Nonetheless, it’s important for any company to stay proactive when it comes to compliance, he says, adding that Burris Logistics already had rigorous SOP’s in place to assure food safety, but was taking extra steps regarding record retention and conducting more internal audits more frequently.

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30

FOOD LOGISTICS | AUGUST 2017

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SHOULD YOU APPLY FOR FDA’S VQIP? The FDA’s Voluntary Qualified Importer Program (VQIP) is designed to help food importers expedite their low risk shipments through FDA. Companies are eligible to apply if they meet these criteria: • Developing and implementing a Quality Assurance Program (QAP) that demonstrates a high level of control over the safety and security of supply chains.

• Assurance of compliance with the supplier verification and other importer responsibilities under the applicable Foreign Supplier Verification Program (FSVP), juice HACCP (Hazard Analysis and Critical Control Points), or seafood HACCP regulations.

• A current facility certification issued under FDA’s Accredited Third-Party Certification regulations for each foreign supplier of food intended for importation under VQIP. In the case of raw produce, there must be a certification for the farm.

• At least a three-year history of importing food to the United States. The import history may be based on the shared importation history of previous or parent companies, such as those that have been involved in a merger. If applicants have imported food for more than three years, the FDA may review additional years as necessary to adequately evaluate compliance history.

• No ongoing FDA administrative or judicial action (e.g., import alert, injunction, recall), or other history of significant non-compliance with food safety regulations by the importer, other entities in the supply chain (e.g., foreign suppliers, filers/brokers, and FSVP and HACCP importers), or food.

• Having a Dun & Bradstreet (D&B) Data Universal Numbering System (DUNS) number. To obtain a DUNS number, contact D&B at 866-705-5711 or via e-mail at govt@dnb.com. All entities doing business with the U.S. government can receive a DUNS number free of charge.

www.foodlogistics.com

8/7/17 9:00 AM

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8/7/17 9:00 AM

SPECIAL FEATURE

FOOD LOGISTICS’

2017 TOP 3PL & COLD STORAGE PROVIDERS

BY EDITORIAL STAFF

2017

M

aintaining the cold chain is vital to protecting and meeting the demands of today’s ever-changing supply chain. The companies on this year’s Top 3PL & Cold Storage Providers list each play an important role in keeping up with that challenge.

Diverse in their capabilities and the customers they service, each company continues to improve their expertise and keep up with the latest temperature monitoring technologies, transportation management systems and warehouse management systems. 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.

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FOOD LOGISTICS | AUGUST 2017

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To help logistics professionals know who they can turn to for help in temperature-controlled transport issues, Food Logistics offers its annual Top 3PL & Cold Storage Providers as an upto-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 the capabilities of these companies and the geographic regions they serve.

Congratulations to all of the companies earning a spot on our 2017 Top 3PL & Cold Storage Providers list. The following are expanded profiles of some of the companies on the list. www.foodlogistics.com

8/15/17 1:01 PM

Americold Location: Atlanta, Georgia Website: www.americold.com Year Founded: 1903 Number of Employees: 11,000 Area served: International Asset/Non Asset: Both Worth Noting: Americold customers asked for a national consolidation program, and the logistics provider has worked hard to deliver a network of regional consolidation centers to cover every food retailer and service provider with scheduled deliveries. Customers have national access from any of Americold’s strategically-located regional consolidation centers.

Burris Logistics Location: Milford, Delaware Website: www.burrislogistics.com Year Founded: 1925 Number of Employees: 1,863 Area served: U.S. Region Asset/Non-Asset: Both Worth Noting: Burris Logistics is a high-quality provider of customized perishable, multi-temperature supply

chain solutions, including freight management, warehousing, distribution and technology solutions. They pride themselves on their ability to learn from their customers and the industries they serve to collaborate on the best solutions for their supply chain needs.

DSC Logistics Location: Des Plaines, Illinois Website: www.dsclogistics.com Year Founded: 1960 Number of Employees: 3,600 Area served: North America Asset/Non Asset: Both Worth Noting: DSC Logistics is a leader in transforming logistics and supply chain management into a critical business strategy based on collaborative partnerships, innovative thinking and high-performance operations. Additionally, DSC is a certified woman-owned business.

DSW Distribution Centers Inc. Location: Rancho Cucamonga, California Website: www.dswdist.com Year Founded: 1973

Number of Employees: 55 Area served: International Asset/Non-Asset: Asset Worth Noting: DSW Distribution Centers Inc. is a 44-year-old, family-owned, third-party logistics provider, offering a wide array of value-added services, with specialized licensing and multiple temperatures for the food, pharma/bio tech, beverage and consumer packaged goods industries.

Ease Logistics Services LLC Location: Dublin, Ohio Website: www.easelogistics.com Year Founded: 2014 Number of Employees: 22 Area served: National Asset/Non-Asset: Non-asset Worth Noting: Ease Logistics has experienced steady growth through the food and beverage industry since its founding in 2014. In three years, their revenue has grown from $3 million in 2014, $12 million in 2015 and $18 million in 2016. Ease moves more than 9,000 temperature-controlled and 5,000 dry shipments a year.

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FLOG0817_32-47_3PLAwardsREV.indd 33

AUGUST 2017 | FOOD LOGISTICS

33

8/15/17 1:01 PM

ADVERTORIAL

FOOD SAFETY EXCELLENCE A COMPETITIVE DIFFERENTIATOR How leading companies that meet and exceed the compliance standards established by the FSMA are raising the bar for customers and peers.

T

he U.S. Food and Drug Administration’s Food Safety Modernization Act (FSMA) represents a legislative milestone aimed at improving food safety across the food supply chain. From growers to packers, to transporters and warehouses, all the way to the grocery shelf, every stakeholder is making fundamental changes to their operations to comply with the new regulations.

Given the scope of FSMA, it’s not surprising that the resulting impact is both sizeable and costly. Industry surveys show that among the biggest concerns is implementation; more specifically, what will it cost and how will companies acquire the resources to comply?

Responsibility for compliance rests with the shipper, loader, carrier and receiver, so no one is immune from the FSMA regulations. However, industry-leading organizations that focused on food safety prior to the implementation of FSMA view their excellence in food safety and proactive adoption of the regulations as a competitive differentiator. Due to the complexity of FSMA and responsibility of all parties from farm to fork, those organizations that haven’t made

FLOG0817_32-47_3PLAwardsREV.indd 34

safety a focus, should consider now more than ever a third party logistics provider that specializes in food transportation and handling.

Taking a proactive approach to regulatory compliance Logistics providers that position themselves on the leading edge of food safety and FSMA compliance protect brand reputation and build trust among their customers and end consumers.

At the same time, the food supply chain is increasingly complex, while consumer demands continue to alter how and where food is pur-

chased, delivered and consumed.

For example, some of the macro food supply chain trends include more imports/exports of food, including perishable foods; ongoing SKU proliferation; rising interest in meal kits as well as locally-sourced food; and the emergence of online grocery shopping and home delivery.

These trends have implications for food safety, notes Darin Cooprider, vice president and general manager, consumer packaged goods, at Ryder.

“Fresh and locally grown products, especially fruits and vegetables, are certainly on the upswing in consumer buying preferences,” he notes. “While these products may offer improved freshness, taste and nutritional benefits, they may also carry an increased risk of foodborne illness due to a lack of food grade processing.”

Cooprider emphasizes the benefits of taking a proactive approach to food safety, internally and externally, and the importance of continually working to educate customers and promote food safety best practices.

“Ryder has taken a very proactive approach to the FSMA. We

8/15/17 1:01 PM

have engaged outside expertise and counsel to ensure we completely understand the forthcoming regulations and that we are educated and prepared to assist our customers in their compliance,” he explains. “Furthermore, we have held briefings at the highest levels within Ryder’s leadership to assure we have executive buy-in for all forthcoming changes and requests.

In addition, we have made our internal and external counsel available to key Ryder customers by holding multiple educational sessions.”

Food safety best practices from farm to fork With its strategic operations throughout the food supply chain, including packaging, warehousing and transportation, Ryder is able to maintain regulatory compliance and food safety, as well as an integrated cold chain that boosts shelf life and reduces food waste.

“Manufacturers, retailers and consumers alike all expect the same thing—that supply chain partners act in a safe and professional manner. This prevents adulteration or otherwise introducing or rendering products within their custody and control unusable or unsafe,” says Cooprider. “At Ryder, we handle all food products either in transport or within our warehouses in strict

accordance with the manufacturers’ guidelines for safe and proper handling. This includes adherence to product rotational guidelines, proper temperature adherence, and utilization of correct handling equipment, all backed up with accurate and complete recordkeeping. In

addition, within our packaging operations, we ensure proper packaging and labeling of all food products.”

Meanwhile, Ryder has developed rigorous food safety practices in its facilities and manufacturing processes to reduce food spoilage.

The systems are designed to meet current quality control standards, while providing high-speed efficiency capable of handling the demand of tight production schedules.

Today, the chain of custody of food from farm to fork is critical for food manufacturers. In response, Ryder has customized its staffing programs in food grade facilities to provide dedicated food safety specialists that are FDA-registered for Safe Quality Food (SQF) Level 3 certification.

Admittedly, while the impact of the FSMA has generated increased costs and resources throughout the food supply chain, leading logistics providers like Ryder recognize the undisputed benefits of improving food safety, both for its customers and consumers.

Ryder supports the food and beverage supply chain with source to shelf solutions with a focus on food safety and regulatory compliance.

For more information, visit: ryder.com/industries/food-beverage

FLOG0817_32-47_3PLAwardsREV.indd 35

8/15/17 1:01 PM

Bulk Air Ca rgo Dedic ated C ontra Freigh ct Car t Forw riage ard Fleet Leasin ing g Interm odal Less than T rucklo Multiad Vendo r Con Ocean solida tion Rail Refrig erat Full T ed Truckin rucklo g ad Draya g e Se rvices Contin uou Fuel S s Moves aving s Prog Direc ram t Stor e Deli Truck load B very roker Rail/T age ruck Trans Full S load ervice Ma n a Custo ged T ms Br o kerag ransportat Other ion e

2017

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Allen Lund Company

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Cross Dock Fulfillm ing ent Inven tory/C ost A MultiVendo ccounting r Con Pick/ solida Pack tion Assem Public bly Refrig .

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Antwerp Cold Stores

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Atlanta Bonded Warehouse Corp.

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Burris Logistics www.burrislogistics.com

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Cardinal Logistics Management

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CaseStack

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Choptank Transport

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Columbian Logistics Network

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LTL order consolidation, pool point analysis, network footprint studies, network optimization, carrier rationalization, facility process studies, volatility profiling of order patterns, reporting and analytics, and more.

Coyote Logistics www.coyote.com

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DSC Logistics www.dsclogistics.com

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East Coast Warehouse & Distribution Corp.

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FOOD LOGISTICS | AUGUST 2017

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www.foodlogistics.com

8/15/17 1:01 PM

Real-Time Solutions for Quality and Visibility Monitoring in-transit temperature and location to final destination.

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sensitech.com @sensitech © 2017 Sensitech Inc. All rights reserved.

FLOG0817_32-47_3PLAwardsREV.indd 37

8/15/17 1:01 PM

Bulk Air Ca rgo Dedic ated C ontra Freigh ct Car t Forw riage ard Fleet Leasin ing g Interm odal Less than T rucklo Multiad Vendo r Con Ocean solida tion Rail Refrig erat Full T ed Truckin rucklo g ad Draya g e Se rvices Contin uou Fuel S s Moves aving s Prog Direc ram t Stor e Deli Truck load B very roker Rail/T age ruck Trans Full S load ervice Ma n a Custo ged T ms Br o kerag ransportat Other ion e

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Elston-Nationwide Carriers

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England Logistics www.englandlogistics.com

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FreezPak Logistics

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FST Logistics

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Hanover Logistics

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Hellmann Perishable Logistics

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Henningsen Cold Storage Co.

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Inmar

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InterChange Group

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J.B. Hunt Transport www.jbhunt.com

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FST Logistics Location: Columbus, Ohio Website: www.fstlogistics.com Year Founded: 1991 Number of Employees: 300 Area served: North America Asset/Non-Asset: Both Worth Noting: FST Logistics is an employee-owned, 100 percent food-focused logistics company, offering customers a single source solution for all temperature-controlled warehousing and transportation needs. In addition, they offer a fulfillment solution for small e-commerce packages— for both B-B and B-C.

H&M Bay Inc. Location: Federalsburg, Maryland Website: www.hmbayinc.com

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Year Founded: 1982 Number of Employees: 555 Area served: National Asset/Non-Asset: Non-asset Worth Noting: H&M Bay is the country’s premier logistics provider for less-thantruckload (LTL) refrigerated and frozen commodities. Consolidation centers strategically located nationwide, along with a host of web-based systems for ordering and tracking, help H&M Bay’s customers manage all their shipping needs.

Area served: National Asset/Non-Asset: Non-asset Worth Noting: Henningsen Cold Storage Co. is a fifth-generation, family-owned corporation, with roots dating to 1923.

Henningsen also is the 11th largest cold storage company in North America, and currently is finishing construction on its 11th temperature-controlled warehouse, which will be located in Salem, Oregon.

Henningsen Cold Storage Co.

Location: Fresno, California Website: www.johansontrans.com Year Founded: 1971 Number of Employees: 89 Area served: International Asset/Non-Asset: Non-asset

Location: Hillsboro, Oregon Website: www.henningsen.com Year Founded: 1923 Number of Employees: 341

Johanson Transportation Service

www.foodlogistics.com

8/15/17 1:01 PM

Worth Noting: JTS is a transportation member of Blue Book Services, with a $1.5 million credit score and the highest 4X rating. They are TIA Performance Certified and an Internet Truckstop Diamond Broker. JTS is unique in offering business improvement ideas, TMS services, and above and beyond shipment monitoring and confirmation services for their customers.

Kane Is Able Location: Scranton, Pennsylvania Website: www.kaneisable.com Year Founded: 1930 Number of Employees: 1,300 Area served: National Asset/Non-Asset: Both Worth Noting: In an outsourced services environment, culture matters. Companies can’t afford to partner with a group of clock-watchers who see themselves as one step removed from their customers. Companies need team players that think and act as extensions of their company, sweating the details, pinching pennies, losing sleep. That’s the kind of culture that’s been cultivated at Kane Is Able since 1930. Those are the kinds of people they employ. Results don’t lie.

www.foodlogistics.com

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Keller Logistics Group Location: Defiance, Ohio Website: www.kellerlogistics.com Year Founded: 1978 Number of Employees: 346 Area served: National Asset/Non-Asset: Both Worth Noting: Keller Logistics Group is family owned and accountable to their stakeholders—not stockholders—standing proud of their small company culture with large corporate capabilities. Keller’s suite of services provides efficient closed loop logistics solutions, minimizing the costs associated with multiple logistics resource outsourcing. Their affiliate companies specialize in serving the food and beverage, consumer packaged goods, building supplies, medical and scrap metal industries.

Kenco Location: Chattanooga, Tennessee Website: www.kencogroup.com Year Founded: 1950 Number of Employees: 5,000 Area served: North America Asset/Non-Asset: Both Worth Noting: Kenco’s integrated

logistics platform focuses on commitment to service and cultural alignment, while providing vertically integrated and engineered solutions with its partners.

Kenco also is a U.S.- and Canada-focused company, with the capabilities of fulfilling supplier diversity requirements.

Additionally, they are proud to be the largest woman-owned third-party logistics company in the United States.

Lineage Logistics Location: Irvine, California Website: www.lineagelogistics.com Year Founded: 2006 Number of Employees: 6,500 Area served: North America Asset/Non Asset: Asset Worth Noting: Lineage Logistics recently opened a new facility in Long Beach, California, expanding its national cold storage footprint to more than 610 million cubic feet at 114 facilities in 22 states. The company also added high pressure processing capacity at two locations and initiated energy savings programs throughout the network. Additionally, the company acquired Consolidated Distribution

AUGUST 2017 | FOOD LOGISTICS

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8/15/17 1:01 PM

Bulk Air Ca rgo Dedic ated C ontra Freigh ct Car t Forw riage ard Fleet Leasin ing g Interm odal Less than T rucklo Multiad Vendo r Con Ocean solida tion Rail Refrig e ra Full T ted Truckin rucklo g ad Draya g e Se rvices Contin uou Fuel S s Moves aving s Prog Direc ram t Stor e Deli Truck load B very roker Rail/T age ruck Trans Full S load ervice Ma n a Custo ged T ms Br o kerag ransportat Other ion e

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Johanson Transportation Service www.johansontrans.com

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Kane Is Able www.kaneisable.com

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Keller Logistics Group www.kellerlogistics.com

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Kenco www.kencogroup.com

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KTI LTD

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Legion Logistics

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Lineage Logistics

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LoadDelivered LogicGo

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MegaCorp Logistics www.megacorplogistics.com

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MTC Logistics

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Newport-St. Paul Cold Storage Co.

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Next Generation Logistics

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NFI www.nfiindustries.com

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Corporation (CDC), a third-party logistics and redistribution company, which makes Lineage the largest customized redistribution network in the United States.

Metro Park Warehouses Location: Kansas City, Missouri Website: www.mpwus.com Year Founded: 1970 Number of Employees: 175 Area served: U.S. Region Asset/Non-Asset: Asset Worth Noting: Metro Park Warehouses differentiates itself competitively as a licensed alcohol, drugs and medical device distributor. Metro Park recently established a regional truckload company for customer outbound shipments, and constructed a new 350,000-square-foot building to accommodate growth by two major customers. The expansion allowed another major customer to consolidate inventories and other customers to streamline inbound rail shipments.

Penske Logistics Location: Reading, Pennsylvania Website: www.penskelogistics.com Year Founded: 1969

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Number of Employees: 14,180 Area served: International Asset/Non-Asset: Both Worth Noting: Penske Logistics is one of the industry’s largest providers of 3PL, dedicated contract carrier and warehousing services.

Polar & Great Lakes Cold Storage Location: Solon, Ohio Website: www.polar3pl.com Year Founded: 1999 Number of Employees: 100+ Area served: North America Asset/Non-Asset: Both Worth Noting: As a full service 3PL, Polar & Great Lakes Cold Storage offers a variety of services to customers across North America. Transportation services include temperature-controlled LTL and truckload capabilities, multi-vendor consolidation, local shuttles and redelivery, and dedicated services. Warehousing services include long- and short-term commitments across 8.8 million cubic feet of space, blast freezing, labeling, full EDI, and seasonal opportunities.

Port Jersey Logistics Location: Cranbury, New Jersey Website: www.portjersey.com Year Founded: 1954 Number of Employees: 195 Area served: National Asset/Non Asset: Both Worth Noting: Port Jersey Logistics operates two divisions: Continental Logistics Inc., focused on transportation management, and Tyler Distribution Centers Inc., focused on warehousing solutions. Both divisions focus on servicing the packaged food and food ingredients industries by combining advanced systems, compliance knowledge and industry experience.

RBW Logistics Location: Augusta, Georgia Website: www.rbwlogistics.com Year Founded: 1954 Number of Employees: 124 Area served: North America Asset/Non-Asset: Both Worth Noting: RBW likes to think of themselves as creative logisticians. They work with food-grade manufacturing customers to add value and create a

AUGUST 2017 | FOOD LOGISTICS

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smarter supply chain. Most recently, they were able to help a customer improve their operations and remove a couple links of their supply chain by allowing them to blend their tea in one of the RBW facilities.

Redwood Logistics Location: Chicago, Illinois Website: www.redwoodlogistics.com Year Founded: 2001 Number of Employees: 357 Area served: North America Asset/Non-Asset: Both Worth Noting: Redwood’s proprietary B2B integration platform, RedwoodConnectSM, enables the logistics provider to integrate their customers’ disparate supply chain systems seamlessly, meaning a faster speed to automation, improved visibility and control. Redwood’s employees act as a trusted extension of their customer’s team, creating continued value.

They have grown organically because Redwood never stops investing in their

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people and a culture that fosters long-lasting relationships with their customers.

RLS Logistics Location: Newfield, New Jersey Website: www.rlslogistics.com Year Founded: 1988 Number of Employees: 250 Area served: North America Asset/Non-Asset: Both Worth Noting: RLS Logistics continues to provide exceptional service, with heavy emphasis on service and food safety. Expansion plans are under way for construction of their fifth cold storage location.

RLS also is looking to expand operations in the west and Salt Lake City, Utah.

They offer temperature-controlled LTL consolidation, warehousing, packaging, re-packing, and B2B and B2C fulfillment.

Ryder System Inc. Location: Miami, Florida Website: www.ryder.com Year Founded: 1933

Number of Employees: 34,500 Area served: International Asset/Non-Asset: Both Worth Noting: Ryder provides warehousing and transportation services, with public and dedicated warehouse facilities; cross-dock and trans-load capability; and food packaging capabilities, with a 343,000 square foot multi-temperature facility located on 27 acres in Beaver Dam, Wisconsin. Ryder recently launched a new, innovative technology solution, RyderShare, which works on smart devices and desktops alike, providing load location visibility, tracking and customized communications across all modes of transportation through a single source.

Service First Logistics Inc. Location: Auburn Hills, Michigan Website: www.sflcompanies.com Year Founded: 2011 Number of Employees: 45 Area served: North America

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©2016 Carrier Corporation

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©2015 Carrier Corporation.

, E C N A M R O F R E TR U E P .

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SUPPLY CHAIN PARTNER CRITICAL DETAILS

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Asset/Non-Asset: Both Worth Noting: Service First’s competitive differentiator is their dedication to improve the supply chain through innovative technology. Their TMS platform provides customers with complete transparency, offering live shipment tracking, temperature readings, integrated messaging and paperless document storage. Service First customers have the ability to view, update and make notes to a shipment from their smartphone, tablet or computer.

Snowland Freight Services Location: Mendota Heights, Minnesota Website: www.snowlandfreight.com Year Founded: 1985 Number of Employees: 12 Area served: National Asset/Non-Asset: Non-asset Worth Noting: Snowland is a 3PL with the infrastructure, technology and resources to help customers simplify their supply chain, create efficiency and develop solutions that drive value

without compromising on quality. They manage almost every type of shipment to all points in the contiguous 48 states, and are committed to long-term relationships with both shippers and carriers.

Star Distribution Systems Inc. Location: Plant City, Florida Website: www.stardistribution.us Year Founded: 1892 Number of Employees: 325 Area served: U.S. Region Asset/Non-Asset: Both Worth Noting: Star Distribution’s core focus is providing LTL freight consolidation services with guaranteed next day delivery to any location in the state of Florida. They have more than 150 food and beverage customers who take advantage of their program—from soup to nuts.

Transplace Location: Frisco, Texas Website: www.transplace.com Year Founded: 2000 Number of Employees: 1,740 Area served: North America Asset/Non Asset: Non-asset Worth Noting: Transplace is a premier provider of managed transportation, consulting and TMS solutions, as well as intermodal, truck brokerage and cross-border trade services. With operations centers located throughout North America, Transplace delivers integrated solutions tailored to meet in-county and cross-border supply chain needs. The company is recognized among the elite 3PLs for its proven ability to deliver both rapid return on investment and consistent value to a customer base ranging from mid-market shippers to Fortune 500 companies.

Transportation Insight Location: Hickory, North Carolina Website: www.transportationisight.com Year Founded: 1999 Number of Employees: 440 Area served: International Asset/Non-Asset: Both Worth Noting: Transportation Insight is a global enterprise logistics provider with top-tier solutions in all transportation modes. The U.S. EPA 2016 SmartWay Excellence Awardee’s offerings encompass robust technology, big data solutions, supply chain analytics, streamlined operational processes and proprietary

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continuous improvement methodologies for the end-to-end supply chain.

VersaCold Logistics Services Location: Richmond, British Columbia Website: www.versacold.com Year Founded: 1946 Number of Employees: 2,600 Area served: North America Asset/Non-Asset: Both Worth Noting: VersaCold is Canada’s largest supply chain solutions company, focused exclusively on the handling of temperature sensitive products. VersaCold delivers a suite of fully integrated logistics services through its national network of industry leading facilities, transportation fleet and advanced technologies, which set the benchmark for accessibility, information visualization, real-time tracking and inventory management.

reliability—guaranteeing products arrive in the best shape, the right quantity and at the correct time—is key to their clients’ supply chain processes.

Yusen Logistics (Americas) Inc. Location: Secaucus, New Jersey Website: www.yusen-logistics.com Year Founded: 1955 Number of Employees: 2,700 Area served: International

Asset/Non Asset: Non-asset Worth Noting: Yusen Logistics (Americas) has more than four decades of experience working with food growers, manufacturers, suppliers and retailers to help them solve their unique supply chain requirements. Yusen handles nearly a million dollars in food- and beverage-related business each year. Their services include: reefer, over the road, less-thantruckload, flow-through warehousing and retail POS display management.

Worley Companies Location: Cedar Rapids, Iowa Website: www.worleycompanies.com Year Founded: 1977 Number of Employees: 120 Area served: National Asset/Non-Asset: Both Worth Noting: Worley is strategically located for regional storage of temperature-controlled and ambient storage.

Worley’s focus on food defense/food safety and regulatory compliance is an attribute their clients depend on as a service provider and technical resource.

Their operational strategy and tactical approach are designed to be in sync with their clients’ strategic objectives. Worley’s WMS, WAREPAK/400, is capable of interfacing with major ERP solutions.

WSI Location: Appleton, Wisconsin Website: www.wsinc.com Year Founded: 1966 Number of Employees: 1,000 Area served: National Asset/Non Asset: Both Worth Noting: From canned tomatoes to non-fat dry milk to cranberries, WSI is your dry foods expert. Adhering to rigorous condition, count and time standards and safety regulations, WSI ensures products leave warehouses in top condition for journeys across town or overseas. Commitment to absolute

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AUGUST 2017

| FOOD LOGISTICS

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SECTOR REPORTS WAREHOUSE

BY CHRIS LEWIS

NEW ROBOTICS

IMPACT THE FUTURE OF DISTRIBUTION To improve warehouse & distribution center productivity, adaptability and safety, companies are providing new robotics offerings.

48

R

egardless of the season, a shift in technology or changes in product delivery, some things tend to remain the same.

Food and beverage warehouses and distribution centers, for example, are always closely monitoring their employees’ productivity and work environments, along with their costs, automation and throughput.

And, as the seasons change, technology shifts and product delivery becomes even more demanding. Yet, these crucial aspects of successful distribution are still top priorities.

By utilizing the following robotics offerings, warehouses and distribution centers are improving their odds for success—whether its higher profit margins, improved work environments, more automation or higher throughput. As a result, they no longer have to be wary of change.

Rather, they can fully embrace it.

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Working in Sync with Employees To help maximize food and beverage warehouses and distribution centers’ thin margins, Dematic Egemin’s robotic product offerings are replacing fork trucks with automatic guided vehicles (AGVs) that conduct virtually every type of activity that traditional fork trucks have in the past—but without the cost of manual labor.

After all, as autonomous robots, AGVs can automatically load and unload trailers, while also performing automatic picking and transport in food and beverage distribution warehouses. Not to mention, in blast freezer or cold storage environments, they can operate nearly all day long, as they only require battery swap outs every several hours. As a result, the AGVs free workers from the harsh

temperature environments that are inherent in food and beverage distribution warehouses, so that they can work in more value-add areas instead.

“As we look ahead to the One area future, one area we will see new where we will developments be seeing new is where in robots and developments robotics is where workers the robots and work workers work closely closely togethtogether.” er,” says John Clark, director of John Clark, director of North North American American marketing, marketing for Dematic Egemin Dematic Egemin.

“Historically, the idea of AGVs was to do work without people or separately from workers. But a new generation of AGVs is now poised www.foodlogistics.com

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SR: SOFTWARE & TECHNOLOGY continued

 Dematic’s robotic product offerings, shown below, are replacing fork trucks with automatic guided vehicles (AGVs) that can conduct nearly every activity a traditional fork truck has in the past.

50

to work alongside—and in sync— with workers.”

Dematic’s latest AGV, which is scheduled for release this fall, will operate automatically alongside workers. Once orders are complete, the AGV will then leave the worker and automatically transport the orders to shipping, prior to another AGV arriving to continue picking.

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“For a food and beverage distribution center, where orders are typically cases, rather than pallets, this will be a valuable labor-saving picking option—and much less expensive than an AS/RS or conveyor solution,” Clark adds.

Increased Flexibility and Adaptability As a consulting and engineering firm, Peach State Integrated Technologies is involved in a variety of projects in which it evaluates traditional automation options like AS/ RS, multi-shuttles and palletizers as a means to reduce operational costs. These tools still offer considerable capability, as many operations are mostly manual, especially food and beverage distribution, which is generally still conducted at a full case level.

Nonetheless, many co-packers have been exploring more robotics

solutions lately, primarily to handle some of their tasks.

“These could include taking three 12-pack cases of product of three separate flavors and creating 12 three-packs of all three flavors for a warehouse or grocery customer, or adding a mix in—like nuts or granola—to a yogurt or applesauce cup to create a totally new product,” says Dean Starovasnik, practice director, Distribution Engineering Design, Peach State.

Oftentimes, according to Starovasnik, the de-palletizing of initial products, along with heat sealing or shrink wrapping (prior to palletizing the final products), has been applied to not only reduce labor, but also offer assistance with ergonomic issues. Yet, the actual handling of individual items in between these functions has never received much attention—until now.

“Normally this work is—if not

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SR: SOFTWARE & TECHNOLOGY continued

seasonal—at least pretty irregular, with relatively short-term contracts,” he explains. “Therefore, the payback is more challenging.

So the increased flexibility and of the newer robotic adaptability of the newer robotic tools is appealing.” tools is appealing.”

With regard to the mix in Dean Starovasnik, practice director, Peach State example, the application of a mix in cup to a base product cup, such as granola to yogurt, can be quite challenging, and applesauce cups may not be the same size as yogurt cups, and so forth. For that reason, the flexibility of robotic arms with grippers, adaptable to varying sized objects, is very attractive now.

“The gripper—normally multiple cup capacity—grabs and applies some number of cups of cracker crumbs simultaneously, usually with the aid of a vision system to increase the speed of the grab and placement,” Starovasnik states.

“The flexibility is important, as the

The increased flexibility & adaptability

 Swisslog’s ACPaQ, shown above, has been estimated to increase throughput by up to 1,000 units an hour, roughly two to three times more than typical solutions.

actual contents of each job vary in size, method of attachment and types of products.”

Starovasnik adds that “if the robot can move from one job to another quickly, the realized throughput is enhanced. This helps to increase pay back, as staff is not required to reconfigure the robot, yet it continues to produce at a consistently high level.”

Automated Mixed Pallet Picking

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By combining technology like its light goods shuttle system (the CycloneCarrier), along with conveyor systems that have high performance palletizing robots, Swisslog has recently developed a fully automated system for order picking of mixed case pallets.

The system, known as ACPaQ, is considered a universally applicable solution, as it features the RowPaQ—which is designed for mixed row palletizing and comprised of a palletizing robot (KU-

KA’s KR470)—and a four fork row gripper that is capable of handling multiple cases.

Due to its versatility, the ACPaQ can palletize complete rows, while taking up to four cases from a pick-up conveyor at a time and then placing them on pallets. And, of equal importance, it also allows units of different dimensions to be processed at the same time, as package types like cartons, crates, shrink wrapped products and trays can all be handled gently.

In addition to its applicability, regardless of package type or size, the ACPaQ’s row grouping of products has been estimated to increase throughput by up to 1,000 units an hour, roughly two to three times more than typical solutions.

“Based on our relationship with our parent company, KUKA, we are positively impacting safety in warehouses, as we automate unsafe or heavy tasks previously performed by humans,” says Patrik Seibel, global market leader for Swisslog.

“And we’re increasing the availability of distribution center operations, because our automation is less dependent on a large workforce, thereby ensuring that customers receive their orders.”

Chris Lewis is the owner of Innovative Written Solutions, a content development and editorial services company. In addition to Food Logistics, he has also written for a variety of organizations, including the Golf Channel and St. Jude Children’s Research Hospital, as well as in industries like engineering, higher education and workforce solutions. He can be reached at lewis.christopherm@gmail.com. www.foodlogistics.com

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SECTOR REPORTS TRANSPORTATION

BY CHRIS LEWIS

REEFER TRAILERS AND CONTAINERS:

THE WAY OF THE FUTURE As the food supply chain continues to respond to the FSMA transportation rules, four companies are paving the way for the future of food distribution.

T

ime is money. And as the demands for faster shipments and deliveries continue to rise, food and beverage distributors are certainly noticing the effects. Not only must they distribute products quickly to ensure they maintain optimum shelf life, they also need to keep an eye on product loads, freight damage, temperatures, and of course, their bottom lines.

To alleviate the stress, the following four companies are offering ongoing engineering and design advancements for refrigerated trucks and trailers, as well as refrigeration units, to provide distributors more options for their perishable goods, a longer shelf life, and ultimately, an increase in profits.

1

Carrier Transicold

To help food shippers and fleets comply with the Food Safety Modernization Act (FSMA) transportation rules that came into force in April, Carrier Transicold is now offering its DataLink 2 recorder, an independent temperature monitor and recorder for refrigerated trucks and trailers.

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 Carrier Transicold recently introduced its DataLink 2 temperature monitor and recorder, shown above, to offer food distributors another means to track and manage the information they need to achieve their FSMA compliance goals.

Using up to three independent temperature sensors, the DataLink 2 system can be used for either single- or multi-temperature applications, offering food distribution operations another means to track and manage the type of information they need to achieve their FSMA compliance goals.

Not to mention, the system also features an integral thermal printer, so that drivers can easily produce graphical and numerical trip reports for receivers, while also downloading

data into their personal computers for electronic logging.

“Increasingly, haulers of perishable and frozen foods are using temperature monitoring and reporting capabilities, with temperature accountability a growing focus following the release of the FSMA transportation rules,” says Mark Fragnito, product manager, controls, Carrier Transicold.

In addition to providing temperature monitoring and reporting capabilities, Carrier Transicold also has redesigned its Cab Command controller for its Supra truck

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refrigeration units, so that they can be mounted in the dashboard. Featuring an interface in an advanced, compact design, the new controller conforms to the DIN specification, so that it can easily (and cleanly) be installed in a truck cab’s dash.

“Operators like the Cab Command controller because of its ease of use and functionality,” says Scott Parker, product manager, truck products, Carrier Transicold. “Our latest version offers the convenience of in-dash installation, or when used with an optional surface-mount bracket, it can be located on an overhead console, underneath or on top of the dash, giving users a wider range of placement options.”

2

Kinedyne

More often than not, food and beverage containers have odd shapes and sizes that prevent them from being easily stacked on top of one another in a trailer. In addition, they also can be easily damaged, leading to product losses, extra expenses for replacements, and eventually, a noticeable decline in earnings.

But these issues can be better managed as a result of Kinedyne’s

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state-of-the-art Kaptive Beam Decking System, which allows fleets to reduce their run schedules and overhead costs. The primary reason? By handling mixed cargo, diminishing double stacking and reducing load shifting, the system can help decrease freight damage, as it lowers the number of drivers, tractors and trailers that are needed to move the freight—since they can actually maximize the capacity of the load they’re transporting.

While decreasing damage claims by upwards of 50 percent, and doubling refrigerated trailers’ load capacity, the system also can increase the profits on every load that is carried by 25 to 50 percent.

Furthermore, it also can be retrofitted on a majority of dry van trailers and spec’d on new refrigerated trailer builds by every major OEM. “By increasing trailer load capacities by as much as 50 percent, the Kaptive Beam Decking System enables fleets to increase their profits substantially,” says Paul Wolford, vice president of sales and marketing for Kinedyne. “With the Kaptive Beam, fleets can significantly improve the capacity of every load they move.”

3

Stoughton Trailers

As Stoughton Trailers prepares to enter the refrigerated trailer market in 2018, it is currently developing a product that will be competitive in three primary categories: weight, cost and thermal performance.

To achieve these key objectives, the new refrigerated trailer will feature a composite, lightweight and durable rear door that enhances thermal efficiency, as well as an insulating process that ensures it is fully insulated at all connections. At the same time, the trailer also will offer users a six-inch or two-inch aluminum integral floor scuff (with a 12-inch or 16-inch integral liner scuff) to help prevent potential damage during loading and unloading—a significant cost reducer.

In addition, users’ cargo will be well protected from any type of

By increasing trailer load capacities by 50 percent, the Kaptive Beam Decking System

enables fleets to increase profits.”

Paul Wolford, vice president of sales and marketing, Kinedyne

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Engineered with the help of the top consultants in the business.

Our customers.

Competitive financing available through Daimler Truck Financial. For the Freightliner Trucks dealer nearest you, call 1-800-FTL-HELP. FTL/MC-A-1454. Specifications are subject to change without notice. Copyright Š 2017 Daimler Trucks North America LLC. All rights reserved. Freightliner Trucks is a division of Daimler Trucks North America LLC, a Daimler company.

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Why do we look to you, our customers, for inspiration? Simple. We only succeed if you succeed. You asked for the new CascadiaÂŽ to be equipped with an easy-to-remove bumper for quicker maintenance. We made it happen. You asked for a better way to access electrical components. We gave you eVault. You challenged us to boost fuel economy, even though we already are a leader in the industry. We improved it by up to 8%*.

When it comes to knowing what your business needs to succeed, there’s no better expert than you. freightliner.com/new-cascadia

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SR: TRANSPORTATION continued

Eicher, director of engineering for the Diversified Trailer Products Division of Stoughton. “Also, to eliminate any components that could rot or decay over time, the trailers will not contain any wood products, thus extending their service life.”

4

weather condition, as the trailers will also feature a standard triple wiper seal door gasket to prevent water intrusion.

“By strategically integrating the use of structural composites in areas that augment thermal performance and decrease trailer weight—without compromising repair and maintenance practices that are familiar to the industry— Stoughton’s refrigerated trailer will be competitive when it enters the marketplace next year,” says Todd

Without question, there is nothing more detrimental to a food or beverage product’s shelf life than a refrigeration unit that requires unplanned maintenance.

A well-designed unit must never be taken for granted. There are simply no exceptions.

“For that reason, Thermo King continues to invest engineering resources in the testing and overall improvement of the components and systems that support the daily operation of our trailer refrigeration units (TRUs),” says Tom Kampf, product manager for Thermo King.

Developed with customers’ unique business needs in mind, the company currently offers four greater than 25 horsepower units (known as the S-Series) and two less than 25 horsepower units (known as the C-Series), which can be utilized for single-temperature or multi-temperature product applications.

Of equal importance, the greater than 25 horsepower units (the S-Series) also provide an increased pull-down capacity in hot environ-

Chris Lewis is the owner of Innovative Written Solutions, a content development and editorial services company. In addition to Food Logistics, he also has written for a variety of organizations, including the Golf Channel and St. Jude Children’s Research Hospital, as well as industries like engineering, higher education and workforce solutions. He can be reached at lewis.christopherm@gmail.com.

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E UR AT

CONTROLLED LT L L HT SO UTIONS EIG FR

RING TE LIVE MP DE ER

 While decreasing damage claims by 50 percent and doubling a refrigerated trailer’s load capacity, Kinedyne’s Kaptive Beam Decking System, shown above, also can increase profits by 25 to 50 percent.

Thermo King

ments, as well as quicker recovery from door openings.

“This is an important consideration for both single-temperature and multi-temperature distribution applications, which require the trailer to return to its set point quickly—a critical element in ensuring that food and beverage products have a longer shelf life,” Kampf explains.

To further guarantee optimal shelf life for food and beverages during transport, accurate temperature control also is necessary.

Therefore, Thermo King offers two operating modes: Continuous Run and Start/Stop.

“The Start/Stop mode, in particular, not only helps increase the unit’s efficiency—but given that our Return Air Sensor is located on the side of the evaporator, rather than below it—our customers can be reassured that the temperature they are reading outside of the trailer accurately mirrors the air temperature inside of it,” he adds.

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SECTOR REPORTS SOFTWARE & TECHNOLOGY

BY AMY WUNDERLIN

Harnessing the

POWER OF BIG T

Understanding big data and how to convert it into profitability is a challenge many are still learning to overcome.

DATA & Perspective ANALYTICS FEEL SOMEWHAT SUCCESSFUL IN MINING CONSUMER DATA TO GENERATE USABLE INSIGHTS

41% 45% OF RETAILERS

OF MANUFACTURERS

he last time you visited a fast food restaurant, you may have been given the option to mix your own soda flavor at one of Coca Cola’s Freestyle machines. The soda fountain gives users more than 100 flavor options, and while the innovation is a consumer’s dream, it is providing the soft drink manufacturer with a data gold mine.

All of this data is great for a Fortune 500 like Coca Cola—which recently used intelligence from the machine to bottle its latest soda flavor: Sprite Cherry—but what about those in the food and beverage industry without the resources to harness such information?

Understanding big data and how to convert it into profitability is a challenge many are still learning to overcome.

“The great challenge facing today’s business entities is to undertake an organizational redesign that allows them to analyze data in ways that boost the bottom line,” says Roberto Wagmaister, CEO of Grupo ASSA (gA), a leading Digital Business Transformation (dBT) firm with offices and operations in the United States and Latin America.

“Driven by the acquisition and management of data, business systems must be modified to capitalize on available technology. Companies need to understand that we are at a point where those who do not transform, will disappear.”

Taking Collection Part of that transformation is finding the right tool, solution or partner that can capture, manage, analyze and understand data in a manageable and efficient way.

A new survey published in June

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DATA

by JDA Software, a leader in supply chain and retail solutions, titled, “Voice of the Category Manager 2017,” found that big data and predictive analytics top the list of investment priorities for both retailers and manufacturers, with 59 percent of retailers and 83 percent of manufacturers admitting they are behind on leveraging both. Furthermore, in response, 45 percent of retailers and 43 percent of manufacturers plan to prioritize big data and predictive analytics in the next five years.

“As consumers are more

DATA & Perspective ANALYTICS

equipped with information, the biggest challenge for retailers and manufacturers is: ‘How do I get that information sooner and act upon it?’” says Todd McCourtie, group vice president, product strategy at JDA. “If anything, the survey tells us that it’s not just about collecting lots of data, but that you have to do something with the data.”

According to Srini Muthusrinivasan, senior industry strategies director at JDA, those questions about what to do with a company’s data are creating a new wave of opportunity, because there is no onesize-fits-all solution. Both retailers

TOP PROCESSES BEHIND ON: RETAILERS

MANUFACTURERS

59%

83%

ANALYZING BIG DATA TO RECOGNIZE CONSUMER PREFERENCES & DEMANDS

PREDICTIVE ANALYTICS FOR IMPROVED PRICING & MERCHANDISING

59%

60%

LEVERAGING GEOGRAPHIC & SOCIO-ECONOMIC DATA FOR TARGETED PROMOTIONS & OFFERS

LEVERAGING GEOGRAPHIC & SOCIO-ECONOMIC DATA FOR TARGETED PROMOTIONS & OFFERS

WANT MORE INSIGHT INTO SHOPPER BEHAVORS:

62% 45%

PATH TO PURCHASE PRICE SENSITIVITY

73% 58% www.foodlogistics.com

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each of them, trying to provide different intelligence that would help enhance your forecasting picture, INVESTMENT Perspective PRIORITIES and manufacturers will be forced to inventory visibility and better manPLAN TO PRIORITIZE make an investment—whether it be ufacturing performance,” he adds.

INVESTMENT IN CUSTOMER-DRIVEN in technological solutions, such as Already playing in this space, gA DATA SCIENCE IN NEXT 5 YEARS those that can automate processes, recently launched a digital platform or staff who can dig deeper into called Custonomix, which is a tool the data sciences—to succeed in that forecasts demand based on the today’s highly competitive, unified intelligent use of copious amounts commerce environment. What that of customer data, in nearly real OF RETAILERS investment might look like, howevtime. The platform utilizes mather, is still evolving. ematical algorithms to execute “It’s one thing to provide a buyer large volumes of client data from or category manager with a whole transactions and external events, OF MANUFACTURERS bunch of data insights, but what such as weather forecasts, price they’re really looking for is somecompetition or campaign promoone to decipher it and say, ‘Here’s tion, to automatically synchronize what you need to go execute on the in-demand planning systems. information,’” McCourtie adds.

These, in turn, adjust and optimize Muthusrinivasan predicts that supply chain execution platforms. rather than internal staff answering Ariel Capone, vice president of these questions, the future of big life sciences and U.S. managing data may lie with independent com- director for gA, adds: “We have the panies that specialize in “collecting necessary software, including big certain rims of data, varying by data, fast data, cloud, Internet of what exactly you’re trying to sell.

Things (IoT), and many more tools “There will be multiple players, for obtaining data. Now, our focus is on helping industries become fully capable of AT DSW, WE’VE meeting the challenges of EARNED THE TRUST the digital economy.”

OF MANY...

Roddy Martin, vice BECAUSE WE HAVE president of SCM product MADE THE COMMITMENT marketing at Oracle, a TO APPRECIATE THE provider of integrated NEED FOR FLEXIBILITY, cloud applications and COST-EFFICIENCY platform services, agrees, AND SUPERIOR QUALITY noting the first thing CUSTOMER SERVICE. to remember is that harnessing big data is not • In-House Modern Fleet of • Over 3 Million Cubic Feet of Racked Refrigerated Transportation Multi-Temperature Controlled Space necessarily a technology Equipment, Freight Consolidation Located in the Distribution Hub of challenge.

Southern California.

• Wide Array of Value-Added Services “(In the past) often Total Logistics Management • Alcoholic Beverages, Confections, Refrigerated Juices & Smoothies, • Complete Product Monitoring with what happened was Juice, Co-Packer Raw Materials, 24/7 On-Line Access. EDI, CSV, Dairy-Deli Products, Film, Yogurt, companies invested in FTP, XLS Pharmaceuticals, Industrial and technology of analytics • Food-Pharma Clean Room Baking Food Products, Food Service and General Grocery Items.

• All-Inclusive Rate Structure and not in the applica• State Board of Pharmacy Licenses • Organic & Natural Food Products tion,” he says, adding, • International Language Labeling • Flexibility, Cost-Efficiency and “The data is there; you Superior Quality Customer Service.

• Alcoholic Beverage Licenses, 14/17 don’t have to necessarily DSW DISTRIBUTION CENTERS, INC. create this data. The first A Thayer Group Company point is to map out what 8858 Rochester Avenue the business is trying to Rancho Cucamonga, CA 91730 do. What’s driving the Mailing: P.O. Box 1269, RC, CA 91729-1269 business? Once you’ve dePhone: (909) 483-5841, Ext. 117 Fax: (909) 483-1792 fined the driver, then start www.dswdist.com • sales@dswdist.com identifying the questions

45% 43%

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and the key metrics that you need to analyze in order to see whether you’re being successful at launches, how fast you’re taking to develop new products, etc. And once you’ve got those questions defined, you then go and look for where that data is, and you put a platform in place to be able to analyze this.”

Transportation Insight is another big player already doing this well, with their Insight Fusion® webbased portal. Using a variety of supply chain analytics tools, it helps its clients convert data—from raw materials through end-customer delivery—into deeper understanding and actionable business intelligence. The platform provides clients with insight into their information in real-time through their mobile device, so they can make informed, relevant decisions.

“By helping our clients collect all data across their end-to-end supply chain, Transportation Insight provides a greater level of visibility into the transit of a shipment with deeper detail than the miles and time in transit. As a result, we’re able to help clients make more informed decisions that positively impact their service to customers,” says Jim Taylor, vice president of information technology (IT) at Transportation Insight.

Data in the Cloud As important as your platform or big data partner is, the way you access that data may be just as crucial. The increasingly consumer demand-driven food and beverage trade is more reliant on real-time analytics than ever before, as manufacturers and retailers attempt to keep on pace with the ever-changing industry. In doing so, their greatest tool may just be the cloud.

“Obviously the move to the cloud is a big opportunity for organizations and analytics platforms, but it’s also a big opportunity for managed services from some of the big consultants and system integrators,” says Martin. “Moving to the cloud is a very strategic journey that companies need to www.foodlogistics.com

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think about. And even if they’re still doing transactional analytics, answering questions the company already knows it has, the improved scale delivered by the cloud and the flexibility and speed of deployment driven by the cloud is where companies really need to think strategically about where they want to be and what that roadmap to the cloud looks like.”

Muthusrinivasan sees the integration of a company’s software with the cloud as a type of “plug and play” option.

For example, let’s say a company wanted to improve trend performance through demand shaping.

With cloud accessibility, the user simply would tap into a service that can leverage and help improve the baseline forecast in the company, or provide real-time logistics and inventory visibility.

“So, it’s almost on-demand, yet all of these services would be available on a cloud that I can pick and choose when I need to enhance and

augment my baseline data to gain enhanced intelligence,” he says.

Muthusrinivasan believes cloud intelligence will continue to improve and grow with developments in technologies such as artificial intelligence, machine learning and processing-speed.

“And when it gets better, imagine the impact that it would have on the actual supply chains, as we get products in the hands of the consumer faster, to their taste, quoting right price without much loss of inventory,” he concludes.

Overcoming Talent Challenges In the less mature parts of the analytics cycle, the transactional, it was always about IT building a data warehouse and then producing reports for the business. As ERP systems advanced, many of those reports became a standard part of a company’s supply chain management (SCM) software.

“In today’s world, it’s not about IT

producing reports,” explains Martin.

“It’s about every analyst or every operation lead in the business being able to query the data, look for those patterns, and look for those insights. IT is now responsible for managing the infrastructure, rather than setting up reports.”

Part of the reasoning behind this is the talent now coming into the supply chain “intuitively know how to play around with these analytics and get insights that some of the more traditional supply chain practitioners may not have been able to do,” he adds.

But as trends show, young, technology-abled professionals are not that interested in supply chain jobs, creating one of big data’s greatest challenges of all.

“If you’re going to move from transactional, topical reporting dashboard analytics to predictive analytics you better be prepared to look for and re-skill, retool the organization from a talent point of view,” says Martin.

INVESTMENT Perspective PRIORITIES VIEW CUSTOMERDRIVEN DATA SCIENCE & BUSINESS ANALYTICS AS TOP MERCHANDISING INVESTMENT PRIORITIES

59% 55% OF RETAILERS

OF MANUFACTURERS

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OF OUR •Single-Scan PRODUCT •Traceability •Mobility STRATEGY •Count-Back IS SOLVING •Voice Picking YOUR PAIN •Visibility www.AFSi.com

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SECTOR REPORTS

OCEAN PORTS & CARRIERS

BY KAREN E. THUERMER

A DRAMATIC RESTRUCTURING T

Mergers and acquisitions make waves in the ocean carrier sector, while shippers remain cautious about the impact on perishables cargoes.

he merger and acquisition (M&A) activity in the ocean carrier sector has yet to subside, with the latest reports in June of Cosco Shipping’s intent to acquire Orient Overseas Container Line (OOCL). Over the last three years, seven of the biggest 20 container lines merged or were acquired by other lines. Hanjin Shipping filed bankruptcy.

By all accounts, the liner shipping industry has experienced the most significant restructuring in its history, with more activity likely to occur.

The cause for this restructuring is overcapacity and persistent low freight rates, forcing many steamship companies to operate in

the red. Drewry Maritime Research The merger integrates UASC’s 58 estimates those losses were around vessels with HL’s for a total of 230 $5 billion in 2016. vessels—and one of the youngest Some steamship lines see M&A fleets (7.2 years) in the industry. activity as a plus for reefer shippers. The average size of the vessels is Rolf Habben Jansen, CEO of 6,840 TEUs—which is approximateHapag-Lloyd (HL), believes that the ly 30 percent larger than the averMay 24 merger between HL and age of the top 15 in the industry.

United Arab ShipThe merger Overcapacity and persistent ping Company also combines (UASC) makes his low freight rates resulted in 118 HL services carrier stronger. losses of an estimated with 45 UASC “We now have $5 billion in 2016.” services. The job not only a very of combining Drewry Maritime Research strong market these services is position in Latin America and the expected to be complete by the Atlantic, but also in the Middle East, end of the third quarter, when where we will become one of the UASC’s transport volume transileading carriers,” he says. tions to HL’s information technology (IT) platform.

Rainer Horn, HL spokesman, reports that, so far, the transition has been smooth.

“We have more than 10,000 transition tasks integrated in a 2M ALLIANCE MAERSK project management tool in order MSC to account for everything as well as for synergy tracking,” he explains.

“We inform our customers through various channels, including a personal visit or a call from a sales rep explaining the upcoming steps of the transition and what they mean OCEAN ALLIANCE for the customer.”

CMA CGM COSCO CMA CGM, Seatrade and MarOOCL fret announced on July 18, a new EVERGREEN vessel sharing agreement that will incorporate the services known by CMA CGM as PAD and by Seatrade as MERIDIAN—improving their frequency and port coverage. The THE ALLIANCE service, which is scheduled to NYK LINE launch in October 2017 (subject HAPAG LLOYD to validation by authorities), will K LINE link Northern Europe, the U.S. East MOL YANG MING Coast, Central America, the Pacific Islands, Australia, New Zealand,

OCEAN CARRIER GLOBAL ALLIANCES

2M ALLIANCE

OCEAN ALLIANCE

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Peru and the Caribbean on a weekly basis. Thirteen modern geared ships with a nominal capacity between 2,200-2,500 TEUs will be deployed on this new service (six CMA CGM, six Seatrade and one Marfret). Each will have a minimum of 600 reefers.

CMA CGM owns the second largest reefer container fleet in the world, with more than 325,000 TEUs.

Most of these lines are—or will soon—deploy mega-vessels with a capacity of 15,000-20,000 TEUs. Panelists at the annual meeting of the Agricultural Transportation Coalition (AgTC) in June voiced concern that new alliances add confusion when an exporter books

a container with one carrier, but finds the shipment sailed on another carrier within the same alliance.

Late deliveries also can occur.

Peter Friedmann, AgTC executive director, warned of more stress on seaport terminals and labor.

John Driscoll, maritime director

Global Alliance Reorganization Meanwhile, a reorganization of carrier participation in global alliances also is occurring. In early 2016, 16 carriers participated in four global alliances. By April 2017, 12 carriers became members of three global alliances: 2M (Maersk and MSC), Ocean Alliance (COSCO, CMA CGM, Evergreen and OOCL) and Transport High Efficiency (THE) Alliance (Hapag-Lloyd, K Line, MOL, NYK, and Yang Ming).

These 11 carriers serve more than 70 percent of the global ocean container trade.

The U.S. Department of Agriculture (USDA) Agricultural Marketing Services (AMS) warned: “The changes in global carThese new alliances may cause rier alliances could bring more stress disruption on seaport to many terminals agricultural and labor.” exporter supply Peter Friedmann, executive director, AgTC chains.

Reduced capacity, fewer vessel sailings and rate volatility are of key concern to the agricultural export community, as the carriers attempt to ‘right the ship’ of overcapacity in the marketplace.” www.foodlogistics.com

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Direct Keep it simple. Long Beach is the fastest, most direct way to move goods between the Far East and most of the U.S. That’s all you need to remember: Port of Long Beach. polb.com/trade

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at the Port of Oakland, however, says these developments have relatively little impact on the Port of Oakland.

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Port of Oakland officials see the refrigerated sector as an important growth sector. SSA terminal has been steadily investing in its reefer handling equipment and has arranged special programs with shippers to speed up delivery of export containers and the pick-up of inbound Our rail upgrades are containers. built around vital Trapac ‘on-dock’ rail.”

Terminal is Mario Cordero, executive director, more than Port of Long Beach doubling its operation and is investing in a 150 percent increase in reefer plugs.

In addition, Cool Port Oakland is being developed as a temperature-controlled transload facility to maximize use of the port’s road, rail and shipping network.

“It will increase the import and export of perishable food products,” Driscoll says.

The facility is projected to process 9,000 rail cars per year in Phase I (18,000 inbound and outbound), translating into 36,000 containers. An additional 9,000 containers are projected to move

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via truck. Phase I (approximately 280,000 square-feet) is expected to be operational by summer 2018.

The port also recently completed a $100 million investment in new rail capacity, which benefits both dry and reefer containers transported by rail to and from the port.

In addition, companies such as Preferred Freezer, AGRO Merchants and PCC Logistics have invested in new facilities and/or expanded and upgraded their existing facilities in proximity to the port. Currently, there is more than a million square feet of refrigerated facilities on and near the Port of Oakland.

To the south, the Port of Long Beach’s

executive director Mario Cordero notes that his port “is pursuing the largest modernization program of any seaport in the United States, totaling $4 billion this decade, to serve the container shipping industry, as ocean carriers add bigger and bigger ships.” This includes $1 billion for a rail improvement program that will help prepare for cold chain expansion.

Weight requirements of temperature-controlled cargo, such as frozen meat, means a lot of the cargo moving from the Midwest requires rail transportation directly to terminals for export. “Our rail upgrades are built around this vital ‘on-dock’ rail, which is the most cost effective and environmentally-sustainable way to move goods due to the volumes transported,” Cordero says.

Additionally, the new Long Beach Container Terminal, known as Middle Harbor, has 1,125 stacked spaces for reefers. It will also have 2,250 reefer spaces when construction is finished in 2020. “Overall, we will have 6,000 reefer spaces throughout the port,” says Cordero.

He notes that as a landlord port, the Port of Long Beach provides facilities to tenants, such as those for refrigerated cargo, rather than engaging in the daily work of moving the cargo.

Karen E. Thuermer is an Alexandria, Virginia-based journalist who has been writing about logistics for several decades.

www.foodlogistics.com

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10-4..................................................................................................... 61 AFS Technologies Inc.......................................................... 29, 63 Burris Logistics.............................................................................. 15 CAMS Software Corporation................................................. 49 Carrier Transicold Div................................................................ 43 Daimler Trucks North America LLC.............................56-57 DSC Logistics.................................................................................. 45 DSW Distribution......................................................................... 62 Ford Motor Media.......................................................................2-3 Great Dane Trailers Inc.............................................................. 70 H & M Bay Inc................................................................................. 58 Henningsen Cold Storage Co................................................. 11 IFDA.................................................................................................... 66 Isuzu Truck....................................................................................... 21 Johanson Transportation Servi.............................................. 41 Keller Logistics Group................................................................... 7 KINEXO............................................................................................. 47 Lineage Logistics........................................................................... 31 Load Express................................................................................... 30 Old Dominion Freight Line Inc........................................24-25 Polar 3PL........................................................................................... 39 Port of Long Beach....................................................................... 65 Port Tampa Bay.............................................................................. 23 Q Products and Services........................................................... 46 Ryder System, Inc..................................................................34-35 Sensitech, Inc.................................................................................. 37 Service First Logistics................................................................. 17 SICK Inc................................................................................................ 9 System Logistics Corp................................................................ 52 Telogis - A Verizon Company................................................... 27 Thermo King....................................................................................... 5 TODCO............................................................................................. 33 TranSolutions Inc.......................................................................... 67 Utility Trailers................................................................................. 69 Worley Warehousing Inc.......................................................... 13 Yusen Logistics............................................................................... 51

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AUGUST 2017 | FOOD LOGISTICS

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8/4/17 8:31 AM

FOOD (AND MORE) FOR THOUGHT

BY JAMIE HERRERA

Craft Beer on Thin Ice:

Cold Chain Opportunities in the US-Mexico Border Region

O HERRERA

68

n a warm sunny day along the coastal city of Ensenada, Mexico, finding a refreshing craft beer can be challenging.

Mexican craft breweries are expanding, yet the lack of cold chain storage and shipping significantly slows the market beyond local transport. Nathaniel Schmidt, owner of Cerveceria Agua Mala outside of Ensenada, has no trouble identifying opportunities for third-party logistics (3PL) providers. “Our biggest hurdles are cold shipping and cold storage,” he says.

“These are serious issues. And we are not at a place where we can tell our distributors that they have to do it. It doesn’t exist.”

Pablo Noriega, commercial director of Cerveceria Wendlandt, echoes those concerns.

“In distribution, we are in baby diapers. No one has a distribution center,” he says. “We always have to use an independent distribution company. Some of them are not reliable; some of them don’t know about beers. They are not refrigerated, so it’s difficult.”

In the United States, distributors like Trinity Logistics pride them-

FOOD LOGISTICS | AUGUST 2017

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selves on their alcohol cold chain service, which includes embracing the complexities of the three-tier system, created after the repeal of Prohibition in 1933 to limit the power of “tied-houses,” or retailers tied exclusively to a specific brewer.

While Anheuser-Busch may not have exclusive retailer rights in the United States, big breweries have market dominance in Mexico, due simply to refrigeration.

According to Schmidt, when he looks to go to a new bar, the first thing they say is, “bring me a refrigerator.” There is no culture of refrigerated transit nor storage for beer in much of Mexico, confirms a 2015 report by the Brewers Association. While importers to Mexico connect cold chain to quality, the cost increase of 25 percent leads importers to often choose international brands without a refrigerated transportation condition. For Mexican retailers used to leaving pallets of big beer brands baking outside in the sun, “it’s a work in progress,” he says, for cervezas artesanales.

Craft breweries looking to increase distribution within Mexico have learned to be wary. With notable exception of top Mexican cold chain suppliers Frialsa and Bajo Cero, when Cerveceria Wendlandt’s Noriega asks, “Do you have controlled temperature?” Ninety-nine percent of them don’t.

The International Trade Administration’s 2016 Top Markets Report cites the potential for 30 percent growth for cold chain service providers in Mexico. Such growth is dependent on upgraded infrastructure in transit, stable government and electricity supply. Until then, Collin Corrigan, of Cerveceria Transpeninsular, emphasizes that

Mexican breweries should focus on increasing the local market and a brewery’s own tap room for growth. As for the lack of reefers in Baja? He says, “We send beer in trucks that are ice trucks. Shipping the kegs inside chipped ice, that’s 1940’s bootleg style. It’s awesome.”

Cross-border collaboration helps increase Mexican brewery name recognition stateside. The third-largest acquisition in history of SABMiller by AB InBev in October 2016, makes collaboration between independent craft breweries all the more important.

In his business of distribution class at San Diego State University, Chad Heath, senior director of Stone Distributing, shares how his team looks at a brewery’s ability to scale and grow, and how it will translate and resonate with those outside their home market.

Breweries like Wendlandt, which has collaborated with at least three of the breweries in the Stone portfolio, benefit knowing that “this distributor knows about beer, they have a good warehouse, they have a good temperature, and they know what they are doing,” Heath says. All of Stone’s drivers are Cicerone Certified, with a full fleet of bio-diesel powered reefers and 36,000-square-feet of cold storage.

“Here,” Noriega sighs, “they don’t know.”

Jamie Herrera earned her master’s in international management from UC San Diego, and seeks to connect people across cultures through trade and collaboration across borders. Herrera was a recipient of a scholarship from the Pink Boots Society, an international association for women in the beer industry, and recently completed a class on beer distribution. www.foodlogistics.com

8/2/17 11:33 AM

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8/2/17 11:33 AM