Transcript
Who’s Who In International Logistics - Armstrong’s Guide to Global Supply Chain Management
14th Edition
Armstrong & Associates, Inc.
Providing transportation and logistics expertise since 1980.
Who's Who In International Logistics Armstrong's Guide to Global Supply Chain Management
* Fourteenth Edition *
© Copyright 2006
Armstrong & Associates, Inc.
100 Business Park Circle, Suite 202, Stoughton, WI 53589 USA
Phone: +1-608-873-8929
Fax: +1-608-873-5509
www.3PLogistics.com
All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, Armstrong & Associates, Inc. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that Armstrong & Associates delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such Armstrong & Associates can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.
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Table of Contents
International Logistics Providers
Definitions and Explanations of Terms ABX Logistics, Inc. Air Ocean Group/Wice Logistics Almacenadora, S.A. Almaviva S.A. Alpopular S.A. APL Logistics Archbold Logistics Ltd. ARS Altmann AG Arvato Logistics Services BALtrans Holdings Ltd. BAX Global Supply Chain Management Belfor Logistics N.V. BettR Logistics Birkart Globistics (Thiel Air & Ocean) BLG Logistics Group C. H. Robinson Worldwide Caterpillar Logistics Services, Inc. Centro De Almacenes Congelados C.A. (Cealco) Christian Salvesen plc Coimex Logística Integrada S.A. China Resources Company (CRC Logistics) Crowley Logistics, Inc. CS International Logistics (USA) LLC Companhia Vale do Rio Doce CWT Distribution Ltd. D. Logistics AG De Rooy Logistics BV DFDS Transport Solutions Group A/S DHL - Global Logistics Dimerco Express Group Egerland Automobillogistik GmbH & Co. KG EGL Eagle Global Logistics Emons Spedition GmbH Ewals Cargo Care B.V. Expeditors Int'l of Washington, Inc. Fatton Transport FedEx Supply Chain Services/FedEx Trade Networks Fiege Logistics AG Freight Links Express Holdings Limited Geodis Hammond Logistics Group Limited Hellmann Worldwide Logistics, Inc. Hurry Top Logistics Integrated Logistics Berhad ITS Fabry Kerry Logistics Network Limited Kintetsu World Express
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International Logistics Providers
Konsortium Logistik Berhad Kuehne + Nagel, Inc. Levent Li & Fung Limited Luis Simoes Frans Maas Groep N.V. Maersk Logistics Microlog Logistics (Thiel Automotive) Nippon Express USA, Inc. Nissin International Transport USA, Inc. NYK Logistics Oriental Logistics Holdings Co. Ltd. Panalpina, Inc. PBB Global Logistics Phoenix International Freight Services, Ltd. Poh Tiong Choon Logistics PWC Logistics/GeoLogistics Corporation Round-The-World Logistics Corp. Rudolph Logistik Gruppe Schenker, Inc. Schneider Logistics, Inc. SDV International Logistics Sembawang Kimtrans Ltd. SembCorp Logistics Ltd. Sinotrans Limited STACI Sun Logistics Transport Corporation of India Ltd. TDS Logistics Thiel Logistik AG TNT Logistics TRADISA UPS Supply Chain Solutions UTi Worldwide Inc. Wincanton Logistics Yobel Supply Chain Management Yusen Air & Sea Service Co., Ltd. 209 213 219 222 226 229 233 240 244 249 252 258 262 269 274 277 280 287 291 294 303 309 313 316 320 324 327 331 334 338 342 348 351 359 367 372 375
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INTERNATIONAL LOGISTICS PROVIDERS
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Basic Definitions
Logistics: Logistics is part of the supply chain process. It is the part involving planning, doing and controlling the flow and storage of goods and information. Goods and information flow from origins to customer’s destinations. Contract Logistics: A contractual agreement to provide logistics services. Usually prices, length of contract (term), services required and other considerations are defined and agreed to by the parties. 3PL: The value-added logistics provider who contracts to provide the requested services. 4PL: A consultant operating in the capacity of an LLP, LLM or SCI. LLP (Lead Logistics Provider): A value-added logistics provider who manages other contract logistics operators and provides supply chain consulting services for his customer. LLM (Lead Logistics Manager): A value-added lead logistics provider who designs, builds and manages supply chain assets, processes, people and technology.
Explanations of Capabilities and Service Categories
Category
1 COMPANY BACKGROUND
Asset Focus Founding Business Market Area
Description
Is the company primarily: A=Asset Based or N=Non-Asset Based or a mix? Original business model Int'l=International; N.Amer.=North America; U.S.=United States; Designates the provider's primary focus. Provider can utilize bar coding technology. Electronic Data Interchange. The system optimizes truckload transportation by matching independent moves to form a continuous move. Can the 3PL interface with Enterprise Resource Planning systems? The provider's TMS and WMS systems are integrated. The 3PL provides customers with systems resources via the internet. The optimization routines can handle many-to-many relationships between parties as opposed to just one- to-many or one- to-one. This enables complete supply chain collaboration among different companies. The system consolidates shipments and optimizes the mode selected (i.e. LTL to TL). Provider uses software to model supply chain networks for D.C./warehouse site selection. The provider uses radio frequency technology for identifying goods in the system. The provider can track and trace shipments anywhere in the supply chain within minutes. Transportation Management System Warehouse Management System The information systems can handle communications between parties using XML or similar technology. Primarily used for Internet communications.
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2 INFORMATION SYSTEMS
Bar Coding EDI End-to-end Matching ERP Interfaces Integrated TMS & WMS Internet Customer Access Many-to-many Supply Network Optimization
Mode Conversion/Optimization Network Modeling Radio Frequency Real-time Track & Trace TMS WMS XML Data Handling
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3 TRANSPORTATION MANAGEMENT
Air Freight Forwarding Carrier Mgmt and Contracting Contract File Maintenance Dedicated Contract Carriage End-to-end Matching Freight Brokerage Freight Pay Outsourced Freight Pay Perfomed In-house Home Delivery Load Tendering Loss and Damage Claims Mode Conversion Post-Audit Pre-Audit Tracking & Tracing
Is licensed as a air freight forwarder. Can handle carrier management, negotiations, and contracting. Maintains files for long-term contracts between shippers and carriers. The provider arranges for Dedicated Contract Carriage through other companies, but does not directly provide drivers and power units itself. Matches shipments with available carriers to build continuous moves within the supply chain. Is licensed as a freight broker. Provides freight bill payment services through a third party. Provides freight bill payment services through internal operations. Handles delivery of catalogue orders or deliveries to residences. Has systems and processes in place for tendering loads to carriers. Handles processing of claims for loss and damage. Selects optimal modes for shipments minimizing cost while meeting service requirements. Performs freight bill audits after the freight bill has been paid. Performs freight bill audits prior to bill payment. Can track & trace shipments and provide transit status. The provider can perform cross dock operations, consolidating and deconsolidating shipments and loads. The 3PL performs customized manufacturing services or postpones services until the appropriate time for manufacturing. The 3PL manages warehousing operations and maintains facilities. Provider can replenish manufacturing/assembly lines in a JIT environment. The provider can package several items into one new kit. Does the 3PL support manufacturing operations in other ways? The 3PL can merge shipments from multiple origins into one large shipment prior to delivery at the final destination. Does the provider pick and package orders from locations within a warehouse? The 3PL can "pool" small shipments into truckload quantities. The warehouse has accessible railroad track running up to the facility. The 3PL can perform sequencing or metering of component parts for manufacturing operations. The provider can perform sub-assembly for manufacturing operations. The 3PL controls inventory including performance of physical audits and controls raw material inflows from vendors. Provider can label product or tag with prices, etc. The 3PL can track and, if necessary, perform a recall of items by lot. The 3PL can perform repairs on products. The provider manages inventories of returnable containers such as totes, IBC's, gaylords, etc. and can track each container in the system.
4 WAREHOUSING & VALUE-ADDED
Cross Docking Customization Facilities Mgmt. KanBan Kitting Manufacturing Support Merge in Transit Pick/Pack Pool Distribution Rail Siding Sequencing/Metering Sub-Assembly
5 VALUE-ADDED SERVICES
Inventory Control/Vendor Mgmt Labeling Lot Control Repair/Refurbish Returnable Container Mgmt
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Reverse Logistics Specialty Packaging Store Support/DSD
The 3PL performs reverse logistics; e.g. recycling, used asset disposition, repossession, etc. The 3PL can provide special packaging functions. Will the provider offer in-store support, shelf stocking or direct store distribution (e.g. convenience/grocery stores)? Provides consulting services. Provides banking, factoring, credit and other financial services. Can perform installations or take-downs. Takes customer orders and manages order statuses through the supply chain. Can handle logistics functions of entire projects such as trade shows or oil well construction. Can track and manage supply chain information by purchase order. Will perform quality control functions. Works with union operations. Performs services in the geographic areas indicated. Countries where offices are located, either owned or through agents, are listed below in "Countries with Offices." Consolidates shipments into containers for export shipment. Does the provider routinely handle customs clearance for international shipments? Crating shipments for export. Is designated as a Foreign Trade Zone. Is a Non-Vessel Operating Common Carrier. Transportation, handling and related services at ports. Handles bulk shipments. Provides facilities or equipment that are food grade quality or sterile conditions such as those for pharmaceuticals. Handles hazardous materials. Has achieved ISO certification for quality in a least one location. Can deliver small package shipments to individual destinations (consignees). Handles items requiring temperature-controlled conditions including protect from heat or freezing.
6 OTHER 3PL SERVICES
Consulting Factoring/Financial Services Installation/Removal Order Management Project Logistics Purchase Order Management Quality Control Union Services
7 INTERNATIONAL SERVICES
Areas Served
Consolidation Customs Brokerage Export Crating Foreign Trade Zone NVOCC Port Services
8 SPECIAL SKILLS & HANDLING
Bulk Commodities Food Grade/Sterile Hazardous Materials ISO Certified Package Delivery Temperature Controlled
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Company Name ABX Logistics, Inc. Address: Rue des Deux Gares 150, Tweestationsstraat, B-1070 Brussels Belgium Phone Number: 32 2 526 07 30 Email Address:
[email protected] Fax Number: 32 2 522 49 97 Website Address: www.abxlogistics.com
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: 3i Group plc Int'l Freight Forwarding (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1992
OVERALL CAPABILITY
Overall Capability of Provider: A good European-centric transportation, forwarding and contract logistics 3PL.
KEY PERSONNEL
Jens Tubbesing Jim Schwartz Pres. & CEO (USA) District Manager Christine Buehler Allen Black CFO Information Systems Supervisor
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 3,150 3,150 * 10,000 >600 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 9,500 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 2 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Mostly Leased Warehouses/DC's: (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 500000 Total Annual Airfreight Tonnes:
MARKETS
Apparel/Garments Automotive
(For functional specializations, see "Customers" section.)
Computers, Electronics Healthcare
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Proprietary Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Proprietary Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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Other Systems Capabilities: Bar Coding Demand & Supply Forecasting
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: multiple locations Other Services:
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Bayer Bohler-Uddeholm Budd Ferrari Hewlett Packard Hitachi Nike Noske-Kaeser Novartis Pirelli Porsche Pratt & Whitney Thyssen Stahl UTi
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by ABX Location
Europe Europe Europe
Industry
Healthcare Misc. Misc. Automotive Computers, Electronics Computers, Electronics Apparel/Garments Misc. Healthcare Automotive Automotive Misc. Misc. Computers, Electronics
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Europe Bangladesh
Europe Europe Europe
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COUNTRIES with OFFICES
Africa
Nigeria Saudi Arabia South Africa Tunisia Turkey
Countries served through owned offices or agents Australia / Pac.Isles
Australia
ABX North America
Canada United States
Asia
Bangladesh China Hong Kong Indonesia Japan Korea Malaysia Philippines Singapore Taiwan Thailand Vietnam
Europe
Austria Belgium France Germany Ireland Italy Netherlands Portugal Romania Spain Switzerland United Kingdom
South/Latin America
Argentina Venezuela Brazil Chile Ecuador
EDITOR'S COMMENTS
ABX Logistics had a checkered history as a subsidiary of the Belgium railroad. Its business is 46% European express LTL transportation, 43% air forwarding, 7% contract logistics and 4% full load. ABX’s recent acquisition should bring about better profitability and a stronger European competitor. U.S. operations have been minimal. CEO Lavaux is U.S. trained and an increased profile is expected. Provider's Strengths International forwarding - European transportation core; new ownership. Provider's Weaknesses A smaller player searching for brand recognition in the same space as UPS, FedEx, Deutsche Post and Kuehne + Nagel.
CASES & NEWS
3i Completes ABX Logistics Buyout [vis 3i website, August 3, 2006] 3i, Europe's leading private equity company, today announces that 3i and funds advised by 3i have completed the acquisition from the Belgian Railways (SNCB Holding) of Brussels-based ABX LOGISTICS Worldwide, one of the world's top international freight forwarders and logistics services providers handling air, sea and road consignments. The acquisition excludes the local road distribution business in Belgium which represents less than 3% of total group turnover. This will be retained by SNCB Holding. The international activities from and to Belgium ("road international", "air & sea", "contract logistics") - which are expanding strongly - are to remain part of the ABX LOGISTICS Worldwide Group. ABX LOGISTICS was formed between 1998 and 2001 by means of a series of acquisitions, and now operates in close to 100 countries worldwide and through own operations in 35 countries. The company currently has a turnover of €2.5bn and a workforce of circa 10,000 people. 'Freight forwarding' refers to the organisation on behalf of 3rd party clients of their international freight transport requirements and involves, amongst other things, the consolidation of goods on pallets or in containers, and the subsequent arrangement of their carriage via subcontracted transport providers (shipping lines, airfreight carriers, or haulage firms) and the custom clearance. Stuart McMinnies and Robert Van Goethem, Partners within 3i's European Buyouts business who led the transaction commented: "ABX LOGISTICS is recognised by its customers as providing a highly flexible and bespoke service. This, combined with a management team of the highest quality and a market underpinned by increasing trade from Eastern Europe and Asia, led to our interest in the business. We look forward to supporting ABX LOGISTICS to continue growing and developing internationally, and delivering even more for its customers". Laurent Levaux, CEO of ABX LOGISTICS Worldwide, added "We are delighted to work with 3i. They understand our business and have been able to bring together with SNCB Holding the expertise necessary to manage this complex privatisation process. In addition, 3i's global footprint, combined with their local knowledge and experience will give them an edge in understanding how our global company operates on a local level. With the support of 3i, we shall continue in the future to develop the business through market and acquisitive growth, whilst maintaining the high standards of service and flexibility that our customers have come to expect and trust." 3i is backing the existing management team, led by Laurent Levaux, Chief Executive Officer. Laurent Levaux joined ABX LOGISTICS in March 2003. He previously led the successful turnaround of international engineering group CMI. Before that he was a partner at McKinsey for 10 years. Laurent Levaux holds an MBA from the University of Chicago. Rob Kuijpers, formerly at DHL and SN Brussels Airlines, will also join the Board as a non-executive director. EC extends investigation into ABX subsidies [American Shippers, May 4, 2005}
The European Commission said Tuesday it has decided to extend the formal investigation procedure into ABX Logistics, a state-controlled Belgian logistics service provider, to include the new financing which the Belgian railway company SNCB (Societe Nationale des Chemins de fer Belges), its parent, is planning for its subsidiary. The original investigation procedure into ABX Logistics was initiated in July 2003, but additional finance for about 170 million euros ($219 million) would be provided by the SNCB to ABX Logistics under the latest plan. “Additional information submitted by the Belgian authorities at the beginning of 2005 has prompted the commission to extend the original investigation procedure to include the proposed new measurers,” the EC said. The commission will not rule on whether the amounts under investigation constitute state aid and whether this aid is compatible with the competition rules until it delivers its final decision. The Belgian authorities further said they had started the process of an employee buyout of ABX’s domestic road-based parcel delivery services in France and that SNCB would be selling off the remainder of the ABX group.
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The EC has asked the Belgian authorities to provide proof that, in both instances, the acquisition price is a market price and that no state aid is involved. ABX Logistics France launches MultiPal [via website, April 13, 2004]
MultiPal, the new product announced at International Transport and Logistics Week (SITL) in Paris will be marketed from May 2004. For all shipments of 1 to 6 standard pallets, this new product proposed by ABX LOGISTICS France bridges the gap between chartering and groupage. MultiPal offers clients a host of different advantages: charges per unit carried ; one single collection for smaller consignments; carefully scheduled delivery to rendezvous as agreed in specifications in line with end customer needs: personal deliveries to all floors, consignment traceability and security, since goods remain within a network of hubs limiting the number of breaks in load. Multi Pal also offers cross docking and temporary storage and is ideally suited to occasional promotional campaigns. In short, a simple and effective solution for palletised freight! For more information,
[email protected] ABX Logistics Egypt handles Mercedes Benz exports to China [via website, July 3, 2003]
On behalf of its customer Egyptian German Automotive (EGA), ABX LOGISTICS Egypt recently handled the shipment of 250 E-Class Mercedes Benz saloons bound for China. Egyptian German Automotive (EGA) is the sole manufacturer of Mercedes Benz passenger vehicles in Egypt. ABX LOGISTICS Egypt, which has been importing components from Germany by air for EGA since early 2002, recently handled the shipment of 250 E-Class Mercedes Benz saloons bound for China. The cars, which were manufactured at EGA’s plant just south-east of Cairo, were sent in three batches (24, 144 and 82 cars respectively) over a two-week period in May/June 2003. ABX LOGISTICS Egypt was in charge of all at-works customs clearance operations, supervising car loading to Daimler Chrysler requirements, arranging for the inspection of loading, lashing and securing by Lloyd’s agent, Marine Technical Services Company, and delivering the containers to Port Said by road. It also arranged for bookings on Cosco Line vessels for the sea leg of the journey via Hong Kong to the Chinese port of Huanggang. On 4 June, as the last of the 250 cars to be exported from Egypt to China were loaded, an official ceremony was staged on EGA’s premises to mark the event. ABX Logistics in the picture with Beck + Hach [via website, May 1, 2003]
Becker+Hach (B+H), one of the world ’s biggest picture frame manufacturers, has transferred responsibility for the whole of its logistics to ABX Contract Logistics GmbH. Under the all-inclusive 10-year contract signed at the end of January by B+H and ABX LOGISTICS Managers, ABX LOGISTICS International (Air &Sea) is responsible for bringing the frames from the production centres in China to a central warehouse with 27,000 m² of covered storage and handling areas, including high rise racking, located on B+H ’s premises in Eschwege near Kassel. Distribution throughout Germany and Europe will be handled by ABX LOGISTICS (Deutschland) GmbH (Kassel). B+H’s search for a competent partner to handle all its logistics was prompted by a decision to focus on the core activities of production, quality and sales. Previously it ran its own storage and distribution centre, outsourcing transport to a partner. From mid-2003 year there are plans for integration of further corporate acquisitions at Eschwege. In February 2003 ABX LOGISTICS International took charge of the first containers from Hong Kong, ABX LOGISTICS Germany started distribution and ABX Contract Logistics set about obtaining certification for the over 70 full-time employees in Eschwege it took over in April from B+H. ABX overcomes integration heartburn [by Chris Gillis, American Shipper, December 2003]
… Rapid Growth. The Belgian national Railway created ABX in 1992 to serve as the small-package division of the railroad. The company worked in cooperation with the railroad’s other freight subsidiaries InterFerryBoats and B-Cargo. In 1998, the Belgian National Railway decided to turn ABX into a logistics powerhouse not just in Belgium, but in Europe and beyond. This resulted in a three-year buying spree of freight transport management firms throughout Europe, the Americas and Asia. By the end of 2001, ABX either fully acquired or bought a major share in about 20 logistics firms. Some of the biggest acquisitions were Bahntrans in Germany, Saima Avandero of Italy, and Groupe Dubois in France. The company grew to more than 15,000 employees in 36 countries. Levaux, who took over as CEO of ABX earlier this year, is not critical of the company’s early acquisition strategy, which was led by his predecessor Etienne Schouppe. Levaux believes ABX’s operations are generally in good shape, particularly in Europe. However, the company suffered from the rapid succession of acquisitions and the softening global freight market, he said. “We have an excellent network, especially in Europe,” he said. “But the various acquisitions made by the group followed too hard on each other’s heels and, in addition, they tended to be companies with a strong market reputation in dire financial straits. All this, combined with an increasingly depressed economy, has triggered a negative spiral.” Two years ago, ABX’s losses triggered an outcry from some Belgian politicians, who called for the privatization of ABX and refocus of the railroad on improving passenger services. The political fires in Belgium have largely quieted since the new holding company was announced. ABX management and railroad shareholders remain adamant about maintaining the logistics company’s Belgian roots, but would be willing to consider a partnership or alliance with another large operator. Levaux said the ABX network has reached a level that can compete with the biggest logistics companies, making an ideal candidate for an alliance with another global operator. But selling the company is not an option, he said. ABX Logistics [Consolidation 2003, Transport Intelligence Ltd, Consolidation]
ABX Logistics, the subsidiary of Belgian Railways, SNCB, has tried to emulate rivals such as DPWN and TPG in building integrated express and logistics networks on a global basis. However it has become apparent that its acquisition programme has over extended the company’s resources and that the companies it has bought have not performed as well as ABX hoped. ABX began its acquisition programme in earnest with the purchase of Thyssen Haniel/Bahntrans in 1998, although it had brought a few smaller companies in Netherlands from 1996 onwards. Thyssen Haniel was a well established German freight forwarder, with substantial global
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operations although almost three quarters of its 1.5bn euros turnover was generated in Germany. Also in 1998 the company took over Hae Young in South Korea and Panglobe in the Philippines to strengthen its freight forwarding operations in the Asia Pacific Rim. In 1999 ABX continued the programme with further major European acquisitions. These included Kersten Hunkin, Cors de Jongh BV and most importantly Groupe Dubois in France and Saima Avandero in Italy. The company has found it difficult to integrate the diverse range of companies which it has acquired. The subsidiaries have highly disparate operations as well as coming from a range of cultural backgrounds. Their individual performance has also suffered in the challenging European economic climate. It is likely that some of the largest acquisitions will be sold off either in part or completely and further capital invested in the company by the ultimate owner, the Belgian State. The individual operations which the company judges to be in need of turnaround are France, Netherlands and Germany (road and contract logistics). These are some of the largest entities within the group. They will be placed in separate operating company to the rest of the better performing companies.
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Company Name Air Ocean Group/Wice Logistics Address: 9 Airline Road, Unit 05-23, Cargo Agent Building D, Box 591, Changi Airfreight Centre, Singapore 8198 Phone Number: 65 6542 9822 Email Address:
[email protected] Fax Number: 65 6542 8760 Website Address: www.airocean.com.sg
Subsidiaries or Related Companies Wice Logistics Pte Ltd. Asset Focus: (A = Asset Based, N = Non Asset Based) Airlines GSA Holdings Plc Ltd. Aero 2000 Ground Services Pte Ltd.
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1988 Market Area: Founding Business: Asia Freight Forwarding, GSA,
OVERALL CAPABILITY
Overall Capability of Provider: Good airfreight forwarder and 3PL.
KEY PERSONNEL
Thomas Tay Nguen Cheong CEO Chong Ben Ban COO Ray Teo Gat Choon SVP Lee Thian Bock Koh Bee Leng Dir. Airfreight & Logistics Dir. of Finance
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 525 525 * 729 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 50 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 100 100 Total Warehouses & Distribution Centers: Total Warehouses/DC's: Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Mostly Leased Warehouses/DC's: (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 60000 Total Annual Airfreight Tonnes:
MARKETS
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
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COUNTRIES with OFFICES
Africa Asia
Hong Kong Indonesia Malaysia Philippines Singapore Taiwan Thailand
Countries served through owned offices or agents Australia / Pac.Isles
Australia
Air Ocean Group North America
Canada United States
Europe
Spain
South/Latin America
EDITOR'S COMMENTS
Air Ocean/Wice Logistics is a well known forwarder in the Pacific Rim. Gross margins run 15%. Like most Singapore-based companies, this one is a success with decent future prospects. Provider's Strengths Airfreight and transportation value-adds. Provider's Weaknesses Owner gambles at wrong places (see story below).
CASES & NEWS
General The group was founded in 1988 as an airfreight forwarder in Singapore. It has progressively expanded its services both by organic growth and acquisition including geographic expansion in the Asia Region. Its latest turnover is US$221m with an operating profit of US$ 6.8m. It is a public company but three of the Directors have holdings and ‘deemed’ holdings amounting to over 50% of the shares. The company is registered in Singapore. Operations The main activity of the group is as a freight forwarder, offering a modern and comprehensive range of services with offices in China, Asia Pacific and the USA and a network of agents around the world. Total Revenues were US$221m in the year to March 2004 of which US$167m was from forwarding activities. The second major activity is as a GSA where the group claims to be the biggest GSA in Asia representing 23 international airlines in 12 countries. The group also has a ground handling enterprise based around Changi Airport. Finance The summarised financials together with segmental information and a list of main shareholders are set out on separate sheets. The Annual Report is also available. The March 2004 accounts show a fall in gross profit by comparison with that of 2003. The segmental figures show operating profit and suggest that GSA operations produce operating returns of less than 2% of revenue whilst ground handing work is now breaking even after making losses. The balance sheet shows only limited tangible assets (typical for non asset forwarders) but substantial intangibles which seem to be goodwill on acquisitions. Shareholders’ funds are US$ 34.4m with borrowings at US$24m. Service Offering The Group’s website suggests that a comprehensive range of services is offered including e-commerce and e-customs, warehousing and inventory management and multi modal services. Prospects The group has made a number of recent acquisitions particularly related to building its position in China. It has issued an optimistic 3rd quarter 2004/5 trading statement and the expansion plans appear to be on course. Background Airocean Group Limited is a leading global integrated air, sea and land cargo logistics group with strong core businesses in international freight forwarding, airline general sales agency (“GSA”) and airport terminal ground cargo handling services. Committed to growth, the Group has recently entered into China’s international and domestic express courier market with Express Courier (China) Limited (“Express”), a new subsidiary that was established through a joint venture with A-Sonic Aerospace Limited. Revenue Although operating conditions remained competitive in 3Q FY2004/2005, the Group continued to focus on growing its 3 core businesses, and as well as developing its new core business of express courier services in China. For the quarter ended December 2004, group revenue rose 50.6% from $92.3 million in the corresponding period in FY2003/2004 to $139.0 million. Broad based improvement was again recorded in all core businesses and key geographical segments. Turnover from freight forwarding rose 63.2% from $68.2 million in the corresponding period in FY2003/2004 to $111.3 million in 3Q FY2004/2005, boosted by higher volume of shipment during the traditional year end peak season. LIMAUBI Transport International Co., Ltd (“LIMAUBI”) (a China based logistics group), a subsidiary of UBI Logistics Limited (“UBI”) acquired in January 2004, contributed strongly to the quarter’s revenue growth. LIMA-UBI contributed S$45.5 million revenue in 3Q FY 2004/2005, representing 40.9% of turnover from freight forwarding in 3Q FY 2004/2005. During the quarter, the Group’s GSA division recorded $23.1 million in revenue, increased by 10.5% from the same period last year due to higher space allocations from Group’s airline partners. Turnover from ground handling increased 40.6% from $3.2 million in the corresponding period in FY2003/2004 to $4.5 million as a result of strong contribution from the new SATS (Singapore Airport Terminal Services) contract secured in 2Q FY2004/2005.The Group’s express courier business made a maiden revenue contribution of $0.05 million of turnover recorded
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in December 2004. Express commenced operations in October 2004, and it is currently in 10 cities with Shanghai as its operation’s hub. Following the disposal of its shareholding in a Hong Kong subsidiary, the Group booked a $1.0m gain which was included in Other Revenue in 3Q FY2004/2005. For the nine months ended December 2004, group revenue rose 60.4% from $259.0 million in the corresponding period in FY2003/2004 to $415.5 million. Profitability In 3Q FY2004/2005, gross profit rose 32.3% from $11.8 million in the corresponding period in FY2003/2004 to $15.5 million with higher revenue. However, gross margin eased slightly during the quarter due to a more competitive operating environment. With new subsidiaries added and new contracts secured in the current financial year, salaries and employee benefits rose 57.8% as compared to the corresponding period in the previous financial year, reflecting the larger pool of staff to operate and manage the enlarged business. Other operating expenses were higher during the current quarter mainly due to the acquisition of UBI and the start-up costs for express courier business in China, which commenced operations in this financial year. The lower profit margin and increased operating costs led to a 24.1% decline in operating profit from $3.0 million to $2.3 million for 3Q FY 2004/2005. Finance costs were higher in 3Q FY2004/2005 as a result of additional loans secured to finance the acquisition of UBI. Due to lower profits in 3Q FY2004/2005, income tax expense declined to $0.2 million. With higher operating and finance costs, and lower contribution from associates, group net profit declined to $1.9 million in 3Q FY 2004/2005. For the nine months ended 31 December 2004, group net profit amounted to $4.6 million. Balance Sheet and Cash Flow Statement The disposal of a 60% subsidiary, AOE Freight (HK) Limited, to the minority shareholders during 3Q FY2004/2005 on a partial deferred payment scheme resulted in an increase in “Other receivables”. In line with higher turnover, trade receivables increased from $49.9 million as at 31 March 2004 to $55.2 million as at 31 December 2004. The cash inflows from a share capital injection by shareholders of subsidiaries and from working capital contributed to the increase in cash and cash equivalent from $20.7 million to $23.5 million in 3Q FY2004/2005. Prospects Market conditions are expected to remain competitive in 4Q FY2004/2005. The Group remains committed to growth and will continue to focus on expanding its core businesses. Growth in the China economy and business expansion at LIMA-UBI will underpin the Group’s freight forwarding business. Following a recent increase in flight frequency of the Group’s airline partners in China, its freight forwarding division is expected to benefit from the increased level of activity in 4Q FY 2004/2005. In addition, the Group’s GSA division has recently secured a GSA contract in New Zealand, and operations are expected to commence in February 2005. Having established the initial groundwork for the express courier business in China in 3Q FY 2004/2005, the Group will continue to monitor its development and open new stations progressively to sustain the business expansion. The Group recently proposed a placement of 110 million new shares at $0.25 each to a wholly owned subsidiary of A-Sonic Aerospace Limited ( “A-Sonic ”) and the transaction is subject to shareholders’ approval at an extraordinary general meeting to be convened. The investment by ASonic would foster a closer and stronger business alliance between the two companies which could result in greater business opportunities for the Group. The net proceeds from the shares placement will be used to accelerate the expansion of the Group’s express courier. A-SONIC, AIROCEAN MERGER MAKES SENSE [by Ven Sreenivasan, The Business Times, January 11, 2005]
A good strategic fit between two companies which are familiar and comfortable with each other. That is how Janet Tan, the founder and chief executive of A-Sonic Aerospace, and Thomas Tay the chief executive of Airocean Group, described their recent tie-up. A-Sonic, a mainboard listed aircraft retrofitting and avionics specialist, is paying $27.5 million to buy more that a fifth of its fellow mainboardlisted Airocean making it the single largest shareholder in the logistics specialist. The deal seems to have pleased the market, judging by their recent stock price performance. A-Sonic’s 21.2 per cent stake purchase in Airocean brings even closer, two companies whose fates have already been intertwined. AIROCEAN CHIEF PUTS CONTROVERSY BEHIND HIM [by Lee Su Shyan, The Straits Times, January 4, 2005]
“Inaccurate reports over Thomas Tay’s gambling losses have hurt his reputation” AIROCEAN boss Thomas Tay yesterday spoke frankly for the first time about the controversy over his gambling and the difficulty he has faced trying to clear up his reputation. Mr Tay, who was at the centre of a media storm last year when press reports wrongly claimed that he had lost millions at a casino, told The Straits Times that his punting was a personal matter which did not have an impact on his role as chief executive officer (CEO). It has also emerged that information about Mr Tay’s gambling had been volunteered to the Singapore Exchange before the company was listed in 2000. Mr Tay is now especially keen to put the affair behind him. Airocean announced expansion plans and a new strategic partner yesterday, none of which need the distraction provided by lurid tales from Aussie gambling dens. His difficulties began in October, when Melbourne’s Herald Sun newspaper said he had dropped A$25 million (S$32.15 million) over two years at Crown Casino and local media quickly followed up. Mr Tay attracted a lot of unwanted publicity, with people raising questions over the appropriateness of having a high-roller as a CEO. An investigation by the Victorian Commission for Gambling Regulation revealed that he had in fact won A$1.4 million, but that hardly got a mention. When asked if the publicity has had an impact on the business, Mr Tay pointed to his track record: He joined Airocean in 1992, building it up to become a successful, mainboard-listed company. Mr Tay said his gambling was a private matter: “I don’t smoke, I don’t drink, I don’t womanise; this is what I do in my leisure time, it is a hobby which gives a bit of a thrill. “It’s within my own means. I’ve been managing it. Just like I manage my firm, I manage my own risk and my own wealth.”
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While admitting it is possible in certain cases that such gambling could “overwhelm” a person, Mr Tay reiterated that he was operating well within his personal means. “It depends on the individual’s sense of responsibility, whether he can manage his own risk,” he said. Mr Tay said he was touched by the support of A-Sonic’s CEO, Ms Janet Tan, whose company is set to become Airocean’s largest shareholder, throughout the affair. “I was touched by the fact that the directors of the company had expressed the same support for me,” he said. Ms Tan said: ”Both companies share the same vision, they are very passionate about their business. Thomas is a very sharp entrepreneur with good business acumen.” She added that “these are his personal interests and he is able to segregate these interests” from the business.
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Company Name Almacenadora, S.A. Address: San Francisco de Dos Rios, 1000 San Jose, Costa Rica Phone Number: 506-250-5050 Email Address:
[email protected] Fax Number: 506-250-4546 Website Address: www.almacenadora.net
Subsidiaries or Related Companies Almacenadora heredia, S.A. Asset Focus: (A = Asset Based, N = Non Asset Based) Logistix, S.A.
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1938 Market Area: Founding Business: S. America
OVERALL CAPABILITY
Overall Capability of Provider: Capable provider serving all of Costa Rica with distribution to Central America.
KEY PERSONNEL
Bernardo Escobar Arango Rafael Mora Chinchilla Rodolfo Monturiol CEO Dir. Sales Francisco Chacon Calderon Elizabeth Sanchez Controller
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 5 5 * 120 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: 13 Total Transportation Assets: Total Tractors: 6 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 13 7 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 6 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Leased 0.3 (Million) 7
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Chemicals Consumer Goods Food, Groceries
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Red Prairie Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Red Prairie EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Paragon-Tecsys RedPrairie
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
BASF Clorox Coamesa Dist. Pedro Oller Grupo Numar Kimberly-Clark Sabritas
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Almacenadora Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Chemicals Consumer Goods Consumer Goods Food, Groceries Food, Groceries Consumer Goods Consumer Goods
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
Almacenadora South/Latin America
Costa Rica Central America
EDITOR'S COMMENTS
Almacenadora runs modern warehousing and distribution operations to Central America from Costa Rica. Provider's Strengths Capable, warehousing 3PL; accessibility. Provider's Weaknesses Size and scope.
CASES & NEWS
Leading Mexican Grain Distributor and Third Party Logistics Provider Gains Competitive Advantage with RedPrairie’s Warehouse Management Solution Waukesha, Wis. (Business Wire) March 9, 2005 – RedPrairie Corporation announced today that Almacenadora Mercader (Almer), a leading Mexican grain distributor and third party logistics provider has implemented RedPrairie’s warehouse management solutions for inventory control. Almer’s CEO, Luis Garcia, said, “Because of this technology we have been able to win many new customers we wouldn’t otherwise have been able to attract. We now provide capabilities and benefits our competitors don’t offer, such as web-enabled visibility to inventories, even management notifications and flexible differentiated billing.” RedPrairie’s warehouse management solutions (WMS) provides Almer improved efficiencies and reduces error rates associated with manual environments. The distributor and 3PL is able to manage inventory throughout its supply chain. In Almer’s case, inventory includes more than 1.3 metric tons of grain across 30 warehouses in 14 different Mexican cities, as well as various types of customer shipments from its 3PL business. Almer has met receiving and shipping goals and targets since implementation go live in early February. Because they did not experience backlogs or delayed shipments, customers were not negatively impacted by the implementation.
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Company Name Almaviva S.A. Address: Calle 35 No. 7-47 Piso 5, Bogota, Colombia Phone Number: 571-338-1799 Email Address: Fax Number: 571-338-4380
[email protected]
Website Address: www.almaviva.com.co
Subsidiaries or Related Companies C.I. Almaviva S.A. Asset Focus: N South Logistics S.A. (Chile) (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1938 Market Area: Founding Business: S. America
OVERALL CAPABILITY
Overall Capability of Provider: Capable large South American warehousing 3PL with modern distribution operations.
KEY PERSONNEL
Pedro Echeverria Carlos Torres Luis Manual Corrales Hector Forero German Mauricio Bernal
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 47 47 * 800 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 28 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Owned 1.1 (Million) 3
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Computers, Electronics Consumer Goods
(For functional specializations, see "Customers" section.)
Oil & Energy
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Provia Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Provia FOURSITE LOGISNET Foursite EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Black & Decker BP Amoco Colgate-Palmolive Ford Motor Samsung Sony Unilever
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Almaviva Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Consumer Goods Oil & Energy Consumer Goods Automotive Computers, Electronics Computers, Electronics Consumer Goods
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
Almaviva South/Latin America
Colombia Chile
EDITOR'S COMMENTS
Almaviva S.A. provides distribution throughout Columbia with 26 warehouses in 20 locations. Provider's Strengths Capable South American 3PL with broad coverage in a difficult area. Provider's Weaknesses Narrow range of coverage.
CASES & NEWS
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Company Name Alpopular S.A. Address: Calle 17 No. 7-35, Oficina 1109, Bogota, Colombia Phone Number: 57-1 4880088 Email Address:
[email protected] Fax Number: 51-7 4880098 Website Address: www.alpopular.com.co
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Banco Popular S. America (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 2000
OVERALL CAPABILITY
Overall Capability of Provider: Capable warehousing operation tied to ports.
KEY PERSONNEL
Leonardo Delgado Jaramillo Mario Camero Perilla Jose Tibamoso Hurtado Maro Valbuena Miguel Amezquita
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 14 14 * 280 260 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 7 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Owned 1.1 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Metals Chemicals Healthcare
(For functional specializations, see "Customers" section.)
Hotel, Motel Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Foursite EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Foursite
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
BASF Bayer Corbeta E. I. DuPont General Motors IMUSA Peldar Sidetur
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Alpopular Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Chemicals Healthcare Hotel, Motel Chemicals Automotive Industrial Industrial Metals
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
Alpopular South/Latin America
Colombia
EDITOR'S COMMENTS
Alpopular is a Columbia-based 3PL owned by a bank. Provider's Strengths Capable 3PL in a tough location. Provider's Weaknesses Limited geographical range.
CASES & NEWS
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Company Name APL Logistics Address: 1111 Broadway, Oakland, CA 94607 USA Phone Number: 510-272-8000 Email Address: Fax Number: 510-272-7011
[email protected]
Website Address: www.apllogistics.com
Subsidiaries or Related Companies APL Ltd. Asset Focus: A International Intermodal Express (iix)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: NOL Group (A = Asset Based, Int'l Ocean Transportation & W N = Non Asset Based) Year Started in Logistics: 1974
OVERALL CAPABILITY
Overall Capability of Provider: Good international freight forwarder and supply chain manager with strong contract logistics in the U.S.
KEY PERSONNEL
Brian Lutt William Villalon Jim McAdam President VP Global Mktg. & Prod. Dev. SVP SCS Danny Goh Rosario Rizzo VP Int'l Logistics & Global Op VP Logistics Americas
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 1,290 1,200 * 5,000 750 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol NOL Exchange: Singapore
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 80 Total Trucks: Total Other: 3 19 Total Transportation Assets: Total Tractors: 99 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 3 251 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 162 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 24.5 (Million) 15
Dedicated Contract Carriage Trailers: Total Dry Van: 237 Total Reefers: Total Flatbeds: Total Tankers: Total Other: 11 3
Asset Ownership v.s. Leased: Transportation Equipment: Mostly Leased Warehouses/DC's: Mostly Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 2000000 Total Annual Airfreight Tonnes:
MARKETS
Apparel/Garments Food, Groceries Automotive Healthcare Chemicals Industrial
(For functional specializations, see "Customers" section.)
Computers, Electronics Print, Publishing, Newspape Consumer Goods Technology
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): i2 Technologies, proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition i2 Technologies Irista, Manhattan--PkMS, proprietary CAPS i2 Technologies
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
3M Arvin Meritor Asics Birds-Eye Foods Bobcat Colgate-Palmolive Dell Computer E. I. DuPont General Motors Newell Rubbermaid Nike Parragon Books Procter & Gamble Smith & Nephew
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by APL Location
NA,LA Globally Asia, NA NA NA NA Globally NA, LA NA, LA Globally Globally Europe Globally NA
Industry
Technology Automotive Apparel/Garments Food, Groceries Industrial Consumer Goods Computers, Electronics Chemicals Automotive Consumer Goods Apparel/Garments Print, Publishing, Newspaper Consumer Goods Healthcare
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa
Egypt Mauritius South Africa
Countries served through owned offices or agents Australia / Pac.Isles
Australia Fiji
APL North America
Canada Mexico United States
Asia
Bahrain Bangladesh Brunei Cambodia China Hong Kong India Indonesia Japan Korea Macau Malaysia Myanmar Oman Pakistan Philippines Remar Russia Saipan Singapore Sri Lanka Taiwan Thailand United Arab Emirates Vietnam
Europe
Belgium France Germany Italy Netherlands Norway Portugal Spain Turkey United Kingdom
South/Latin America
Brazil Argentina Chile Costa Rica Dominican Republic El Salvador Guatemala Honduras Jamaica Colombia Nicaragua Peru Venezuela Haiti
EDITOR'S COMMENTS
APL Logistics strengths have been its Asian base and the automotive retail verticals. Two-thirds of revenues are from contract logistics. One-third is from freight forwarding. Over 70% of its revenues are American based. 33% of revenues are automotive/industrial, 27% retail, 14% consumer goods and 10% electronics and high-tech. APL has an automotive joint venture in China. APL Logistics’ CEO is based in Singapore. Forwarding is closely linked to ocean container operations. Provider's Strengths Each part of APL Logistics was a major player in its 3PL segment. APL has strong China, Singapore and Asian bases. Provider's Weaknesses Continuing redesign should improve profitability. Some IT capability slippage occurred with displacement of Jacksonville, FL (GATX) base.
CASES & NEWS
APL Logistics, Con-way Freight start new LCL service from China [American Shipper, August 14, 2006] APL Logistics and Con-way Freight will start a new less-than-containerload service from China to the United States, effective Sept. 5. The service, “OceanGuaranteed,” offers shippers “port-to-door” guaranteed service from the Chinese ports of Hong Kong, Shanghai and Shenzhen to all U.S. destinations served by Con-way Freight In Los Angeles, the cargo will clear customs and be deconsolidated. According to a joint statement released by the companies this morning, shipments that fail to meet the delivery-day commitment receive 20 percent discount, subject to the terms of the service guarantee. “We have created an entirely new service category for our customers that responds to their demands for a premium, day-definite service with transit times and delivery reliability that far exceeds traditional LCL products,” said Brian Lutt, president of APL Logistics, in a statement. “In today’s global marketplace, the majority of our customers are sourcing some aspect of their business from China,” said David McClimon, president of Con-way Freight. “They are managing longer supply chains and more import volumes, yet they still remain under pressure to accelerate product through their domestic distribution networks as rapidly and cost efficiently as possible.” APL Logistics serves as the overall program manager and the carrier of record for shipments tendered on APL Logistics through bills of lading. APL Logistics will handle all in-country China shipment management services. Ocean carriage will be provided by APL. Con-way will manage receipt of ocean containers and deconsolidation in Los Angeles, and delivery of cargo as less-than-trailerload shipments to customers throughout the United States. The companies said that for Customs-Trade Partnership Against Terrorism (C-TPAT) certified importers, shipments tendered under the new LCL service will be segregated in dedicated C-TPAT shippers, and allowing these cargoes to be ‘green laned’ by U.S. Customs and Border Protection.” In addition, APL Logistics and Con-way Freight have set up a simplified pricing structure for OceanGuaranteed. Shipment pricing will be calculated on a per-kilo rate, based on delivery from the origin ports in China to 11 delivery zones in the United States. The shipments will also receive “expedited handling, including late-gate privileges at origin, ‘last on, first off,’ loading/unloading, and priority shipboard stowage for rapid discharge at the destination port,” the companies said.
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The companies said they decided to start the service after reviewing the results of a market study by MergeGlobal, an industry research and consulting firm. The study examined current and emerging conditions for transportation service and capacity in the transpacific, as well as shipping patterns, outsourcing practices, business economics and customer supply chain issues. “The study revealed a clear opportunity for a premium service such as OceanGuaranteed that offered faster transit coupled with higher consistency and reliability,’ the companies said. General Motors honors APL Logistics SINGAPORE, JUNE 1, 2006 – APL Logistics, a worldwide leader in delivering supply chain solutions, has received the Global Supplier of the Year award from General Motors for excellence in international logistics. The award, presented in a ceremony at the General Motors Vehicle Engineering Center in Warren, Mich., highlights a 20-year relationship between the two companies centered on inbound logistics management and ocean freight transportation. “We are pleased and proud to receive this honor from one of the world’s great companies,” said David Lim, Group President and CEO of NOL Group, the parent company of APL Logistics. “We have built our reputation on customer service, and recognition from General Motors is validation that we are living up to our reputation.” A global team of GM executives from purchasing, engineering, manufacturing and logistics evaluate candidates for the prestigious awards. Winners are determined based on performance, quality, service, technology and price. “Global reach and automotive-industry expertise are core strengths of ours,” said APL Logistics President Brian Lutt. “It’s gratifying to be recognized for these strengths by General Motors.” The world’s largest automaker has turned to APL Logistics for more than two decades to provide superior inbound logistics services. APL Logistics manages parts flows for GM within the NAFTA region between suppliers in the greater Midwest and GM assembly plants in Mexico. It also ships parts manufactured in Mexico to GM plants in the U.S. and Canada. Sister company APL, one of the world’s leading container shipping lines, serves GM with ocean transport in the Transpacific trade. APL Logistics Expands Into Spain Global logistics company APL Logistics has signalled its move into the Spanish market. Previously, APL Logistics’ operations were concentrated in the UK, Germany, Benelux and France. This latest move complements the existing footprint of container transportation sister company APL, which established its own office network in Spain during 2003 and moved its Mediterranean regional office to Barcelona at the end of that year. APL Logistics’ HQ in Spain is now also in Barcelona, while both companies operate from established offices in Valencia and Algeciras. “Our move into the Spanish market is part of a larger plan to expand our market presence in Europe,” said Eddy Wouters, APL Logistics Vice President, Europe. “We aim to build on our proven business model of providing international supply chain services to importers and retailers, exploiting our strengths in China and other Asian sourcing countries.” APL has a strong existing Spanish customer base, particularly in the retail and consumer electronics sectors, which will be the focus for growth of APL Logistics services in the country. But development is also expected in other trade sectors. “The Mediterranean is one of the fastest-growing import regions in Europe,” commented Simon Trobe, managing director APL Logistics, Mediterranean region. “Spain in particular is home to a large number of importers whose businesses will benefit greatly from our domestic and international network and service offerings.” APL Logistics Chosen by UK Home Improvement Giant London, 6 September 2005 — APL Logistics has been selected to manage the international supply chain of the PJH Group, the UK’s leading DIY Distributor of bathrooms, kitchen furniture and associated appliances. APL Logistics, which specialises in complete, end-to-end supply chain solutions, manages vendors for PJH, consolidates shipments at various origin locations in Asia and ships through to destination at PJH’s network of eight distribution centres throughout the UK. An important benefit for PJH is APL Logistics’ ability to provide visibility of stock levels at all points in the supply chain, especially at origin. The adoption of APL Logistics’ See Change software by PJH’s purchasing team has greatly improved administration time and replaced outdated processes. PJH Group Logistics Director Kevin Powell commented: “We recognised APL Logistics’ vendor management skills and its ability to deliver to our exacting requirements. We were also attracted by the fact that APL Logistics has owned offices at every origin in Asia from which we source our products. This has undoubtedly helped to improve control over our shipments,” he added. The PJH Group services major retailers, merchants and House Builders throughout the UK. In particular, a successful 14-year relationship with home improvement retailer B&Q has driven consistent growth regarding Asia sourcing and led to the need to redesign its supply chain management process. APL Logistics to Manage Dell Supplier Logistics Center Round Rock, Texas, 17 May 2005 — Dell has awarded the operation of its North Carolina Supplier Logistics Center (SLC) to APL Logistics, a provider of international, end-to-end logistics services. APL Logistics, which established warehouse operations in the Winston-Salem region during the 1980s, is currently in the final stages of discussions with a Forsyth County - area developer to build the SLC facility that will be leased to APL Logistics. The SLC operation will be based out of a 500,000 square foot warehouse within miles of the new Dell factory, scheduled to begin operation in mid-September. The Dell factory will produce Dell’s award-winning desktop computers. The Supplier Logistics Center will handle the inventory for suppliers that provide parts to Dell. The center will warehouse and manage computer peripherals such as monitors, speakers and computer chassis from 50 different suppliers. APL Logistics will initially occupy 100,000 square feet of the facility and plans to ramp up to full capacity over a three-year period. APL Logistics will hire up to 50 full time employees over the course of the next three years. Additional labor of up to 100 seasonal and temporary staff is also anticipated. A local temporary agency will be appointed in the future to manage recruitment from the local WinstonSalem area.
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Company Name Archbold Logistics Ltd. Address: Albert Road, Leeds LS27 8TT United Kingdom Phone Number: 44 113 253 8716 Email Address: Fax Number: 44 113 252 6121
[email protected]
Website Address: www.archbold.co.uk
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1920 Market Area: Founding Business: Europe Trucking (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Capable automotive 3PL and distribution company.
KEY PERSONNEL
Stanley Archbold Mark Higinbottom John Holroyd President Manager Manager
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 38 38 * 180 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 250 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 350 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 7 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: 0.4 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Consumer Goods Containers
(For functional specializations, see "Customers" section.)
Industrial Textiles
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Britain Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Allied Glass Courtlaulds Eastman Kodak Ford Motor Linpac
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Archbld Location
Britain Britain Britain Britain Britain
Industry
Industrial Textiles Consumer Goods Automotive Containers
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
14th Edition
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
France Germany Italy Spain United Kingdom
Archbold North America South/Latin America
EDITOR'S COMMENTS
Archbold Logistics was established over 80 years ago and today operates as a European logistics, distribution and warehousing company. The company is headquartered to the southwest of Leeds. Archbold provides clients with a range of logistics, transport and distribution services, comprising: national logistics services (with 7 UK operating depots), European distribution services (to Germany, France, Italy, Spain and Eastern Europe), warehousing, storage and product consolidation, specialized transport services and logistics management services. In addition, the company specializes in the automotive sector as well as operating a UK and European express service. Provider's Strengths Niche European distribution and logistics with UK base. Provider's Weaknesses Scope and geographical reach.
CASES & NEWS
14th Edition
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Company Name ARS Altmann AG Address: Feierabendmuhle 2, Wolnzach, D-85283 Germany Phone Number: 49-8442-61-310 Email Address: Fax Number: 49-8442-61-315 Website Address: www.ars-altmann.de
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1975 Market Area: Founding Business: Europe Auto Transport (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Capable automotive distributor and exporter.
KEY PERSONNEL
Wilfried Brinkman Frank Lehner Konrad Lehner President Sales & Marketing
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 233 233 * 1,070 25 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 490 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 950 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 7 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Mostly Owned Warehouses/DC's: Mostly Owned 35 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Appliances Automotive
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Audi BMW Daewoo DaimlerChrysler e-Sixt Europcar Fiat Ford Motor Iveco Kia Massey Ferguson Mitsubishi Nissan Opel
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by ARS Altmann Location
Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe
Industry
Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Appliances Appliances Automotive Automotive Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Eastern Europe France Germany Spain
ARS Altmann North America South/Latin America
EDITOR'S COMMENTS
ARS Altmann is an automobile distributor and exporter from Germany to Europe, Eastern Europe and Turkey. Emphasis is on finished vehicle distribution and processing. Provider's Strengths Its distribution network and strength as a niche provider. Provider's Weaknesses Its one industry focus.
CASES & NEWS
ARS Altman Corporation Establishes Meaningful Partnerships and Alliances [via website 5/01, A&A translation] The strategy for ARS Altman in a market with ever-stronger competition is clear: In order to maintain a strong market position it is necessary to bundle the know-how of different partners, instead of competitors always working against each other, says Frank Lehner, Sales and Marketing. Therefore, ARS Altman will enter into strategic partnerships that make sense for our customers and their businesses. We have looked for and utilized partners that have much experience, know-how, and that are specialists within their respective countries. With a growing spectrum of countries within Europe and the continually expanding market, ARS Altmann has established a Europe-wide door-to-door automobile logistic consortium, IAL srl. The partnership with Madrid based CETASA provided access to the second largest automobile market in Europe. Business in the interesting middle Asian market and the Middle East has been made accessible through the founding of ARSOM AS. ARSOM is a joint venture with Turkish Omsan AS, the specialist in automotive and parts transportation.
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Company Name Arvato Logistics Services Address: An der Autobahn, Gutersloh 33310 Germany Phone Number: 49-5241-800 Email Address: Fax Number: 49-5241-806006
[email protected]
Website Address: www.arvato-logistics-services.com
Subsidiaries or Related Companies Arvato Services (NL) Asset Focus: N Arvato Services (US) Arvato Services (P) Arvato Services (CZ) (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Bertelsmann AG Int'l Mkg & media services Year Started in Logistics: 1959
OVERALL CAPABILITY
Overall Capability of Provider: Good media fulfillment 3PL and supply chain manager.
KEY PERSONNEL
Dr. Hans-Joachim Herzog Ralf Bierfischer Frank Maurer CEO President President Frank Schienweisler Ulrich Vollmer President SVP Finance
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 910 910 * 6,200 20 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Technology
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition SAP R/34 EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Warehouse Mgmt System
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Audi BMW Microsoft Volkswagen
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Arvato Location
Europe Europe Singapore Europe
Industry
Automotive Automotive Technology Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
14th Edition
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COUNTRIES with OFFICES
Africa
Morocco South Africa
Countries served through owned offices or agents Australia / Pac.Isles
Australia
Arvato North America
United States Canada United States
Asia
India Singapore
Europe
Austria Belgium Denmark France Germany Greece Ireland Italy Netherlands Norway Poland Portugal Spain Switzerland Turkey United Kingdom Czech Republic
South/Latin America
Argentina Mexico Brazil
EDITOR'S COMMENTS
Arvato Logistics Services is a modern, sophisticated SCM with a fulfillment emphasis in B2B. Its specialty is advertising material development and distribution. Provider's Strengths B2B fulfillment and logistics, communications, supply chain management, finance, reverse logistics and repair. Provider's Weaknesses
CASES & NEWS
Arvato Logistics Services Expands Service Chain with the Takeover of the Automobil Wirtschaft Publishing House [via website] On January 1, 2004, Arvato Logistics Services took over the Automobil Wirtschaft Publishing House Ltd, whose headquarters are in Grefrath. The Automobil Wirtschaft Publishing House Ltd is one of the largest full-service service providers for technical documentation in Germany. The product range includes the entire production process for technical documentation from research all the way to the finished copy in various foreign languages. The services include the production of descriptive documentation and technical illustrations, translations in all the currently prevailing languages, and data management. More than 180 employees in the German locations of Grefrath, Ingolstadt, and Wolfsburg as well as in Spain, the Czech Republic, Brazil, and South Africa are responsible for outstanding services and an optimal proximity to customers. For more that 35 years, Arvato Logistics Services has been providing supply chain solutions, among other things, for the automobile and machine-building industry. The field of content management has achieved strong growth in past years through innovative solutions such as, for example, the Volkswagen portal "erWin" for supplying independent shops and private persons with technical documentation. With the acquisition of the Automobil Wirtschaft Publishing House Arvato Logistics Services has now once again expanded its own service chain homogeneously. Content creation - technologically optimized for one thing in relation to content management, the link that follows it in the service chain, but also with regard to multi-channel distribution - is one of the challenges that Arvato Logistics Services will be facing in the future. "With the takeover of the Automobil Wirtschaft Publishing House Ltd we have succeeded in adding a further important step to the information supply chain solutions for our customers," Ralf Bierfischer, managing director of Arvato Logistics Services, says happily about the new Arvato subsidiary. And Thorsten Winkelmann, member of the management of Arvato Logistics Services and head of the automotive division, adds: "In addition to fulfillment and content management we can now offer our automotive customers content creation services. Arvato is the media full-service partner for the automobile industry." "I am convinced that, with Arvato, we have found a partner to ensure the future growth and continuity of our publishing house. That's why I'll be managing the interests of the Automobil Wirtschaft Publishing House Ltd in the coming years as well. Collaborating with our new colleagues will create decisive impulses for both sides and help us to realize the mutual vision of an optimized value-added chain from the editorial work all the way to multi-channel distribution," explained Walter Bruckmann, managing director of the Automobil Wirtschaft Publishing House Ltd. General Motors Awards Arvato Services Multi-Year Agreement To Provide Business Processing and Lettershop Services for GM Vehicle Purchase Programs [via website, December 16, 2003] Arvato Services, Inc. and General Motors Corporation announce a definitive multi-year agreement. Under the agreement, Arvato Services, Inc. will provide General Motors with business process outsourcing services including fulfillment, lettershop, print on demand services, inventory and procurement management and postal optimization and consolidation services from its state of the art logistics and customer care center in Duncan, South Carolina. As part of this agreement, Arvato Services, Inc. will deploy its leading-edge, supply chain technology platform, SAP R/3 4.6c, intelligent mail insertion machines, as well as its print on demand technology solutions to provide a seamless and complete management system for the GM Vehicle Purchase Program. For more than 35 years, Arvato Services automotive group has been a leading global outsourcing provider of integrated supply chain,
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business process outsourcing, customer relationship management and marketing support programs to automotive manufacturers, dealer groups, suppliers and end users. "Our clients include many of the largest automotive manufacturers in the world and we are very excited about bringing our automotive solutions to North America," said Peter Schmitz, President and CEO of Arvato Services, Inc. "Our advanced supply chain technology and integrated customer care centers in the United States, Canada, Europe and Asia are wellequipped to manage high order and call volumes for domestic and international automotive related programs," said Schmitz. "Strategically located facilities in the east and west coasts of the United States provide outstanding logistics support to cost-effectively meet the demands of both automotive manufacturers and their end-consumers." "General Motors was seeking for a strategic partner that provides localized services with global capabilities. Our business processing expertise, state of the art infrastructure and strategic locations provide GM with the perfect solution to manage their Vehicle Purchase Program." BMG Distribution to Spin off Physical Fulfillment Business to Bertelsmann’s Arvato Services, Inc. BMG Continues to Outsource Non-Core Businesses while Maintaining Current Management and All Sales and Marketing Functions February 26, 2003 Arvato Services will assume full responsibility for BMG Distribution’s packaging, transportation and logistics functions, including operations and personnel in Duncan, SC, Fogelsville, PA and Reno, NV. BMG Distribution will maintain all sales and marketing functions under its current management. Arvato Services international experience and expertise will now be added to BMG's first class U.S. distribution staff, who have been providing the unsurpassed fulfillment services. This marks the continuation of BMG’s corporate strategy of exiting non-core businesses. BMG Distribution is at the center of the music sales and marketing process between its labels and U.S. retailers, whether on-line, brick and click, or brick and mortar. Among its labels are Arista, home to LaFace, Melisma and Time Bomb; BMG U.S. Latin; Buddha; J Records including YClef Records; Logic; RCA Label Group - Nashville, including Arista Nashville and BNA; RCA Records; BMG Heritage; RCA Victor Group including Private Music, Bluebird, RCA Victor, Red Seal and Windham Hill; Robbins Entertainment; and the Zomba Label Group including Brentwood, Jive, Reunion, Silvertone and Verity. In addition, BMG distributes ATO, Kinetic Records, Milan, Razor & Tie; Sanctuary Records Group; V2; and Wind-Up. In Duncan Arvato Services also took over the distribution for Riverdeep, a premier provider of comprehensive K-12 eLearning solutions offering comprehensive courseware and supplemental curricula over the Internet and CD-ROM, assessment and management tools, and professional development. When a mobile handset still cost DM 5,000.... December 19th, 2002 It all began in 1992 on 50 square metres of what can best be described as modest premises, but it is now one of the most important businesses of Arvato Logistics Services: its operations on behalf of the mobile-phone operator Vodafone, comprising appliance logistics, marketing materials and the service centre for the repair of handsets. In November a toast was drunk to the ten years of co-operation; after a welcoming speech by Thorsten Thiel (responsible for telecommunications), Arvato Board Chairman Hartmut Ostrowski,Vodafone Finance Director Albert Weismüller and the former Vodafone Director Rolf Endregat reviewed the ten years of collaboration. Everything started at the beginning of 1992 with the distribution of advertising materials, followed within just a few months by the commission for the distribution of appliances. The first appliance to leave the warehouse in Versmold was the Ericsson GH 172, the very first mobile handset, which could be acquired at a cost of DM 5,000. A single pallet was easily worth as much as a luxury apartment. As a result, stiff security precautions were in operation from the start. For Bertelsmann Distribution, as it was then, this represented the entry into hi-tech distribution. The recording of serial numbers and management of high value returns, along with the establishment of the service centre for repairs, were all factors leading to a rapid expansion of business. The logistics service reached its absolute climax in the year 2000, the boom year in the mobile phone sector. Almost 12 million handsets set out on their journey to the final customer from Arvato Logistics Services. Other large volumes were set in motion by the introduction of D2 CallYa. More than 30 million handsets with the prepaid card were delivered from the Arvato Lgistics Warehouses. It is not only the daily lives of the logistics professionals that are dominated by buzzwords from the mobile phone sector such as SIM,WAP, GPRS, SMS and UMTS. At the jubilee celebration, these same abbreviations were applied to the gourmet items on the menu. Thus MMS became »Manche Mögen’s Scharf« (Some Like It Hot), SIM became »Sünde Im Mantel« (Sin In A Coat) and SMS became »Süsses Mit Sahne« (Sweets And Cream) – a pleasant and original way for the employees of Vodafone and Arvato Logistics Services to while away the evening. VCL Selects Arvato Logistics Services As New Logistics Services Provider December 6, 2002 With their motto “We entertain you”, VCL stands for the marketing of moving pictures for an audience of millions. At the beginning of October 2002 Arvato Logistics Services took charge of goods distribution for VCL in the Entertainment division. Along with their two companies, VCL Communications, whose headquarters are in Munich, and Cine Plus Home Entertainment, whose headquarters are in Offenbach, VCL provides movies, cartoons and documentaries, which are sold on DVD, video cassettes, cinema, television and as video-ondemand. Arvato Logistics Services’ task lies in distributing the video cassettes, the DVDs and the accompanying advertising material for VCL. No problem for the experienced troupe around Friedrich Prill and Burghardt Schulz, because delivery is being handled by the warehouse on 60 Determeyer Street in Gütersloh. Customers from the Home Entertainment division are already being supplied from here, such as Codemasters, Take2 and Ubisoft. By the way, this is Arvato Logistics Services’ first customer under the new company name. The employees of both companies are looking forward to a long-term cooperation and, of course, to many successful movies on the part of VCL! Arvato Services Wins Microsoft Excellence Quality Award 2003 [via website, July 1, 2004]
Microsoft Corp., the world’s leading manufacturer of PC software, has bestowed a Vendor Program Excellence Award 2003 for “Quality” on Arvato Services Inc. The prize was presented to the Valencia, CA-based Arvato AG subsidiary at Microsoft’s annual Vendor Summit in
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Redmond (USA). In addition to coming in first in Quality, Arvato Services also scored among the Top Five in “Services” and “Vendor of the Year.” More than 700 of the Microsoft’s partner companies competed in the contest, in which the software company annually honors providers who provide consistently outstanding services. “Our first place in the Quality ranking and outstanding placements in the other categories are both confirmation and motivation for us. Confirmation of the quality of services Arvato Services has furnished for Microsoft over the past year, and motivation to resolutely pursue the path we have set out on, to continue providing innovative, high-quality and technologically mature services in future,” commented Arvato Services CEO Frank Schirrmeister on the Microsoft award. The Quality award bears testimony to Arvato Services’ focus on continual quality improvements and the rendering of top-level integrated services. Arvato Services renders extensive services to ten of Microsoft’s partner programs in North and Latin America. In particular, these include customer services, financial services and the production and delivery of software and training materials. Microsoft claims that in 2003, Arvato Services was very successful at implementing new programs while still doing full justice to the needs of Microsoft’s customers and partners. Monthly customer surveys at Microsoft’s partners in North and Latin America bear out the high customer satisfaction and top quality associated with Arvato Services.
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Company Name BALtrans Holdings Ltd. Address: 8/F Tower A, New Mandarin Plaza, 14 Science Museum Rd., Tsim Sha Tsui East, Kowloon, Hong Kong Phone Number: 852-2757 7111 Email Address:
[email protected] Fax Number: 852-2368 4066 Website Address: www.baltrans.com
Subsidiaries or Related Companies Jardine Logistics Services Asset Focus: (A = Asset Based, N = Non Asset Based) Exhibitrans Supreme Airfreight
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1979 Market Area: Founding Business: Int'l
OVERALL CAPABILITY
Overall Capability of Provider: Capable freight forwarding based 3PL.
KEY PERSONNEL
Anthony Siu Wing Lau Wan Tat Kwan John Kelly King Chairman & CEO Marketing Director Hooi Chong Ng
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 1,500 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) 477 * Ticker Symbol HKEX: 562 Exchange: Hong Kong
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 25 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: About 50/50 1 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 200000 Total Annual Airfreight Tonnes: >5000
MARKETS
Automotive Fairs, Exhibitions
(For functional specializations, see "Customers" section.)
Telecommunications
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): IPACS Logistics 2000 Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition IPACS IPACS EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling IPACS EXE WMS
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Various Various Various
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by BALtrans Location
China Asia Germany
Industry
Fairs, Exhibitions Telecommunications Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
China Hong Kong India Indonesia Malaysia Singapore Sri Lanka Thailand Vietnam
Countries served through owned offices or agents Australia / Pac.Isles Europe
Britain Germany
BALtrans North America
Canada United States
South/Latin America
EDITOR'S COMMENTS
Warehousing and exhibition operations are primarily in major Chinese cities. Gross margin (net revenue) runs 16%. Airfreight is 54% of business, sea freight is 41%, exhibitions 3% and 3PL 2%. 47% of revenues are Hong Kong and China, 23% Southeast Asia, North America 21% and Europe 9%. Provider's Strengths Provider's Weaknesses
CASES & NEWS
BALtrans Acquires Clover Cargo – Set to Expand in EMEA Region (HONG KONG, 6 February, 2006) – BALtrans Holdings Limited today announced that the Company has entered into an agreement to acquire 52% of the issued share capital of Clover Cargo Holdings (Proprietary) Limited. With its strong base in South Africa, Clover Cargo is engaged in supply chain management business providing international supply chain logistics services and solutions, comprising freight forwarding, customs broking and warehousing, to importers and exporters. It operates in Johannesburg, Durban, Cape Town and Port Elizabeth with 250 employees and achieved an annual turnover in 2004 (excluding custom duties and VAT) of approximately R353 million (HK$445 million). Commenting on the benefits of the acquisition, Mr. Anthony Lau, Chairman and CEO of BALtrans, said, “It has been our goal to expand into new markets and build an integrated global network. The acquisition is not only consistent with our goal, but also signifies our continuing efforts to expand in the Europe, Middle East and Africa (EMEA) region.” “Clover Cargo is a major player in the freight forwarding and logistics field in South Africa and a valuable addition to our worldwide network. Through this acquisition, BALtrans gains a strong foothold in the South African market and stands to benefit immediately from the new business opportunities it brings and in the long run the solid platform it provides for expanding business in the region. By integrating Clover Cargo into BALtrans worldwide network, we expect to achieve synergies and greater economies of scale, which will enable us to enhance our service offerings to our customers.” The Company expects to complete the acquisition by 30 April 2006. BALtrans currently holds 10% of the issued share capital of Clover Cargo Holdings through a non-wholly owned subsidiary. Upon completion of the acquisition, Clover Cargo will become a 59.5% non-wholly owned subsidiary of BALtrans. BALtrans Forms Partnership with Mitsui – Further Strengthens Global Platform (Hong Kong, 2 January, 2006) - BALtrans Holdings Limited, a leading Hong Kong-based freight forwarding and logistics company, today announced that Mitsui & Co. Ltd., one of the largest trading firms in Japan, has entered into an agreement with Jardine Matheson Group to acquire Jardine Matheson’s entire shareholding interest in BALtrans, which comprised 60,300,100 Shares and represented approximately 19.87% of the existing issued share capital of the Company, at a consideration of HK$241,200,400. Through its global logistics arm, “Trinet”, Mitsui Group has been taking advantage of the freight forwarding capabilities and services of BALtrans in China since 2004. Recognizing the competitiveness, the high service quality and extensive global network of BALtrans, Mitsui Group has decided to form a global partnership with BALtrans Group and cement a strategic relationship through equity participation in the Company. Through this strategic alliance, Mitsui will benefit from having BALtrans as a strong and reliable worldwide airfreight partner, whose service capabilities are well-recognized. BALtrans Group, on the other hand, will gain not only airfreight businesses from the Mitsui Group but also, through joint marketing initiatives, airfreight businesses from Japanese corporations worldwide. Both groups will pursue co-ordinated strategies to expand their businesses through M&A and new business development, and realize further synergies through joint procurement and other initiatives. Mr. Anthony Lau, Chairman and CEO of BALtrans, said, ” I am extremely pleased that we are able to bring in Mitsui Group as a strategic partner of BALtrans. I believe that the global business volume of Mitsui, new business opportunities from Japanese corporations as well as future cost synergies will complement our world-class air freight network and service capabilities to create a win-win situation, and contribute to shareholder value of both companies.” Mitsui & Co. Ltd. is a major listed company in Japan and on Nasdaq, with a market capitalization of over US$20 billion, an annual turnover of approximately US$33 billion and over 38,000 employees worldwide. Mitsui Group undertakes sales and marketing, import and export, international trading and manufacturing globally in diverse business segments including metal products & minerals, machinery, electronics and information, chemicals, energy, and consumer products and services. It also provides comprehensive services in retail, logistics, transportation and finance.
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BALtrans Announces Joint Venture to Focus on Development of Container Logistics Services in Yantian, Shenzhen A move to establish a stronger foothold in Mainland China Hong Kong, 15 March 2004 – BALtrans Holdings Limited (“BALtrans” or “the Group”) announced today that its wholly owned subsidiary, BALtrans Logistics Limited (“BALtrans Logistics”), has signed an agreement to establish a joint venture company based in Shenzhen, PRC, to focus on the development of container logistics services at Yantian Port, Shenzhen. The resulting joint venture - to be known as Shenzhen Yantian Port BAL-Shing Logistics Company, Limited – will be 30 per cent-owned by BALtrans Logistics, 40 per cent-owned by Shenzhen Yantian Port Group Co., Limited and 30 per cent-owned by Shing Kee Logistics (Shenzhen Yantian) Limited. The total investment amounts to RMB¥10 million. The initial warehousing space would be approximately 30,000 square metres. BALtrans will fund its share of the investment from internal resources. Mr. Anthony Lau Siu Wing, Chairman and Chief Executive of BALtrans, said, “We are very excited about this latest chapter in BALtrans’ development in Mainland China and even more so about the opportunity to work with joint venture partners such as Shenzhen Yantian Port Group Co., Limited and Shing Kee Logistics (Shenzhen Yantian) Limited.” “This joint venture will leverage the combined expertise of the three companies to provide world-class container logistics services that address growing customer demands at Yantian Port,” said Mr. Lau. “It is part of BALtrans’ efforts to expand our Mainland China operations and capitalize on the booming direct export trade.” Shenzhen Yantian Port Group Co., Limited is a state-owned port operator authorized to manage the planning and development of the rapidly growing Yantian Port area in Shenzhen. It is owned by the Municipal Government of Shenzhen. Shing Kee Logistics (Shenzhen Yantian) Limited is a Hong Kong registered company that specializes in port logistics and warehousing operations at Hong Kong’s Kwai Chung Berth 3 and Yantian Port. Shenzhen Yantian Port BAL-Shing Logistics Company, Limited will be engaged in warehousing, distribution, pick & pack, customs declaration, customs clearance, value-added services, warehouse rental, container depot, transport, international trade, entreport and related logistics operations. Application for a business licence is underway and business operations are expected to commence in the second half of 2004. “The joint venture will enable us to capture third-party logistics and cargo consolidation businesses of the Pearl River Delta at Yantian Port, which is the Number One container terminal in China in terms of throughput. We believe BALtrans’ established presence in China and our international credentials position us well as the partner-of-choice for many domestic and international logistics service users and operators. We will continue to pursue acquisitions and partnership opportunities to drive our China business,” concluded Mr. Lau. BALtrans/Jardine Logistics Group to Deploy IPACS Logistics 2000 Solutions Leading Logistics Service Provider Selects IPACS Logistics 2000 to Optimize Operations and Strengthen Customer Relationships Hong Kong, 8th August 2003 – BALtrans Holdings Ltd, a HK$3 billion turnover company listed on the Hong Kong Exchange and Clearing and IPACS e-Solutions (S) Pte Ltd, a leading IT/e-Commerce solutions and service provider, today have signed a HK$13.5 million deal to implement IPACS Logistics 2000 solution for BALtrans/Jardine Logistics Group worldwide, including Greater China (Hong Kong, Mainland China, Taiwan), South East Asia, USA and Europe. The contract is signed between Mr. Anthony Lau, Chairman and Chief Executive of BALtrans/Jardine Logistics Group and Mr. Wong Sing Lam, Chairman and CEO of IPACS Group of Companies. Under the contract, BALtrans has purchased IPACS Logistics 2000 - an integrated, web-enabled, multi-modal total solution comprising Air freight, Sea freight, Track and Trace, Financial Accounting System and Executive Information Systems for over 500 users of BALtrans Logistics Group worldwide. IPACS Logistics 2000 implementation for BALtrans will commence in September 2003, beginning with Hong Kong. It will run on a combination of IBM Unix and Intel servers and Oracle databases and EIS tools. As the head office of BALtrans/Jardine Logistics Group, its Hong Kong office will be the “IT Nerve Centre” for the group, eventually linking to the other offices worldwide. This enables BALtrans/Jardine Logistics Group to have overall management and control, and real-time visibility for all its global operations. The modus operandi will automate BALtrans/Jardine Logistics Group’s Airfreight, Seafreight, Customer Service, Sales and Marketing as well as Accounting operations. Its objectives are: • To increase accuracy, have better management control and improve operational efficiency by using an integrated solution. • To improve customer service and satisfaction as information flow is now more systematically managed while processes and procedures are being streamlined. This would translate into greater efficiency for BALtrans who would be able to respond more quickly to its customers’ requests. • To provide BALtrans/Jardine Logistics customers with faster turnaround time and real-time online shipment visibility via its Track and Trace and e-logistics service hub, together with the seamless interface with the world class EXE Warehouse Management System, hence providing its customers with a better supply chain management with full visibility in the supply chain. • To reduce long term operational and communication costs through streamlining operations, and intelligent utilization of innovative Information and Internet Technology. IPACS is a Singapore based company with more than 350 staff in Asia Pacific across 10 major cities with more than 2000 customers in the region. It is a premier IT and E-Commerce solutions provider with key competencies in the Transportation & Logistics Industry, as well as the Banking & Finance sectors, Aviation and Airport, Distribution & Manufacturing, Utilities and Commerce industries. Logistics 2000 is IPACS’ latest and most advanced 3PL and 4PL logistics supply chain execution management solution designed to specifically meet the challenges of door-to-door and time definite services required by the ever changing logistics supply chain. It is able to handle customer and order management, airfreight and seafreight operations and manages profit visibility through its job costing, financial and reporting systems. It has an integrated online logistics service module with online booking, shipment and inventory tracking and document and message exchange capabilities. Using state-of-the-art Oracle based, Open System technology, it has a flexible, multi-language and user interface configurable architecture deployable via the Internet (thin client) or intranet (client/server).
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BALtrans Completes the Acquisition of Jardine Logistics Hong Kong, 30 January 2003 – BALtrans Holdings Limited (HKEx stock code: 562) (“BALtrans”) today announced that it has acquired Jardine Logistics, a logistics operation wholly-owned by Jardine Pacific. This follows the completion of the Sale and Purchase Agreement signed with Jardine Matheson Limited on 30 December 2002. Through an issuance of news shares in BALtrans for the acquisition, Jardine Pacific becomes a 20%-shareholder in the enlarged BALtrans group and has board representation. BALtrans will initially retain the Jardine Logistics brand name. Mr. Anthony Lau Siu Wing, Chairman and Chief Executive of BALtrans, said, “This is a strategic move for us to enhance our logistics capabilities. The geographic spread of Jardine Logistics’ operations and customers ideally complements our business. The acquisition strengthens our capabilities in all markets especially in the UK and Europe, and gives us access to new customers and resources.” “It is expected that the merged businesses will also bring about synergies that are likely to lead to a reduction in operating costs,” Mr. Lau added. BALtrans’ F/Y 2002 turnover was HK$1.3 billion while Jardine’s 2002 turnover was about HK$1.8 billion. The combined businesses have created a major logistics group which has 1,500 experienced staff and a comprehensive network of 59 offices around the world.
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Company Name BAX Global Supply Chain Management Address: 400 Galleria Parkway, Suite 1200, Atlanta, GA 30339 USA Phone Number: 678-724-4800 Email Address:
[email protected] Fax Number: 678-724-4851 Website Address: www.baxglobal.com
Subsidiaries or Related Companies Bax Global Inc. Asset Focus: N (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Deutsche Bahn, AG Int'l Air Freight Year Started in Logistics: 1972
OVERALL CAPABILITY
Overall Capability of Provider: Good provider of heavy air freight and aerospace support. International network is established.
KEY PERSONNEL
Joseph Carnes Jeffery Barrie John Carr President & CEO VP Global Sales & Mktg. President Global Logistics Steve Mattessich Doris Hall VP & CFO SVP & CIO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 2,899 1,594 * 12,000 100 3 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 58 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 19 (Million) 20
Asset Ownership v.s. Leased: Transportation Equipment: Mostly Owned Warehouses/DC's: Mostly Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 10000 Total Annual Airfreight Tonnes: 580000
MARKETS
Aerospace Consumer Goods Print, Publishing, Newspape Aircraft parts Healthcare Retailing Automotive Metals Technology
(For functional specializations, see "Customers" section.)
Beverage Military, Government Telecommunications Computers, Electronics Office Equipment/Machines
INFORMATION SYSTEMS
Overall Information Systems Rating: E (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): CAPS, i2 Technologies Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition CAPS, Proprietary EXE, Ultramain (aerospace) CAPS Proprietary Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: 229 locations Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Air France Air New Zealand Airbus Allergan Ann Taylor BD Boeing Bombardier Braun Bristol-Myers Squibb British Airways Cedu Pacific Celestica Cisco Systems
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by BAX Location
France international Hamburg, Germany
Industry
Aerospace Aerospace Aerospace Healthcare Retailing Healthcare Aerospace Aircraft parts Consumer Goods Healthcare Aerospace Aerospace Computers, Electronics Technology
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
international international
international
Asia, Europe
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COUNTRIES with OFFICES
Africa
Botswana Congo Egypt Ghana Kenya Madagascar Malawi Manibia Mauritius Morocco Nigeria Senegal South Africa Tanzania Tunisia Uganda Zambia Zimbabwe
Countries served through owned offices or agents Australia / Pac.Isles
Australia Guam New Zealand Papua New Guinea
BAX North America
Aruba Bahamas Barbados Bermuda Canada Cayman Islands Dominica Dominican Republic Jamaica Mexico United States Virgin Islands
Asia
Azerbaijan Bahrain Bangladesh Cambodia China Cyprus Hong Kong India Indonesia Iraq Israel Japan Jordan Kazakhstan Korea Kuwait Laos Lebanon Malaysia Maldives Nepal Oman Pakistan Philippines Qatar Saudi Arabia Singapore Sri Lanka Syria Taiwan Thailand Turkey United Arab Emirates Vietnam
Europe
Austria Belarus Belgium Boznia & Herzegovina Bulgaria Croatia Czech Republic Denmark Estonia Faroe Islands Finland France Germany Gibralter Greece Hungary Iceland Ireland Italy Latvia Lithuania Malta Netherlands Norway Poland Portugal Romania Russia Serbia & Montenegro Slovakia Slovenia Spain Swedan Switzerland Ukraine United Kingdom
South/Latin America
Argentina Belize Brazil Chile Colombia Costa Rica Ecuador El Salvador French Guiana Guatemala Hairi Honduras Nicaragua Panama Paraguay Peru Puerto Rico Suriname Trinidad & Tobago Uruguay Venezuela
EDITOR'S COMMENTS
BAX Global will remain a separate brand name through 2006 while it is being integrated into Schenker. BAX adds over $2 billion in heavy airfreight to Schenker, significantly expanding Schenker’s airfreight forwarding. BAX Supply Chain Solutions adds good Asia-Pacific and U.S. operations to Schenker’s strong ocean forwarding activities. Joey Carnes lead BAX back to profitability and had BAX on the right track before the Deutsche Bahn purchase. Provider's Strengths International network and specializations, supplier management, supply chain optimization. Provider's Weaknesses
CASES & NEWS
Successful Closing of Acquisition of Bax Global (Berlin / Irvine, 31 January 2006) Today, Deutsche Bahn (DB) successfully completed its acquisition of the American logistics service provider Bax Global Inc., based in Irvine, California from The Brink's Company. The transaction value is approximately US-$ 1.1 billion. With this acquisition, DB will become one of the leading companies worldwide in the transport and logistics sector. The acquisition of Bax will add an approximately 12,000 additional employees and revenues of around two billion euros to DB Group´s portfolio. “After the takeover of Stinnes and its subsidiary Schenker, this is the second biggest takeover in our corporate history,” comments Hartmut Mehdorn, CEO and Chairman of the DB Management Board. “For us this is an occasion of historic importance. The acquisition of Bax enables us to move into the top league of what is a growth industry. Through the strategic strengthening of our network in North America and China we will now be even better placed in these growing markets, and so in a better position to offer our customers logistics solutions from a single source all over the world.” The acquisition of Bax offers additional growth potential to Bax and Schenker in the next years . Schenker and Bax are an excellent match, geographically, in view of the services delivered and in terms of customer structure. Deutsche Bahn expects that the integration of the two companies will be completed over the course of the next year. BAX Global Appointed as Finmeccanica’s Worldwide Transportation Provider
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MILAN, 8th February 2006 – BAX Global Inc., a US$2.4 billion global supply chain and transportation solutions company, has been appointed as Finmeccanica’s global provider for worldwide transportation services. BAX Global is providing freight forwarding services, supporting fulfilment of spare parts and finished product from manufacturing locations in Italy and Western Europe to a worldwide customer base. Finmeccanica is Italy’s leading high-tech company, operating in the design and manufacture of helicopters, aerostructures, satellites, space infrastructure, missiles and defence electronics. Services for Finmeccanica include freight transportation, charter services, customs brokerage, 24-hour aircraft-on-ground (AOG) support, dangerous goods handling, temperature controlled distribution and rotables repair management. BAX Global established a dedicated customer service centre in Milan for Finmeccanica. Additionally, BAX is leveraging its resources from its existing service support infrastructure in US, UK and Asia Pacific. BAX Global has an established market leading position in the aerospace and defence sector. Its AeroBAXSM suite of customised logistics services provides industry leading solutions to many of the world’s largest airframe, aeronautical, airline and defence companies. Walter Crescioli, managing director for BAX Global’s Italian operations commented, “One of the benefits of using BAX Global, is our ability to optimise a customer’s transportation spend using our tremendous resources. And, with our worldclass information systems, customers such as Finmeccanica have increased visibility of their supply chain through BAX’s advanced technology.” Finmeccanica plays a leading role in the European aerospace and defence industry, and participates in some of the biggest international programmes in the sector through well-established alliances with European and American partners. Finmeccanica also boasts significant manufacturing assets and skills in the transport, energy and IT sectors. The group is listed on the Milan stock exchange, and operates in Italy and abroad through 18 companies and 4 joint ventures. It employs around 55,200 staff. BAX Wins 5-Year Aerospace Contract [Transport Intelligence, September 28, 2005]
BAX Global, the worldwide freight forwarder recently put up for sale by its parent Brinks, has been awarded a twin phase, five-year logistics and material management contract by Philippine carrier Cebu Pacific, (CEB), to support the airline’s growing Airbus aircraft fleet. The first phase of the project covers material management and warehousing, enabling the airline’s engineers to receive materials and components from a BAX managed warehouse. The warehouse management encompasses all activities associated with storage of aircraft parts and inventory reporting. BAX will ensure compliance of airworthiness requirements for Cebu Pacific. During phase two, in collaboration with Cebu Pacific, BAX will provide integrated inventory management services at component level, including cycle counting and AMS life (Approved Maintenance Schedule). BAX will also cover material handling services for various orders, including new purchases, loans, repairs and exchanges. BAX Hitches Rail Ride [by Paul Page, Traffic World, November 14, 2005]
Report says Deutsche Bahn to buy freight leader, BAX Global a target as carrier shows strength The BAX Global buyout is coming from Germany as expected but the surprise is that the buyer is not Deutsche Post World Net. Deutsche Bahn, the German railway company, was preparing to buy BAX for a reported $1.17 billion in a deal that would finish off the complete overhaul of the American integrated air express market and advance the relentless consolidation among global logistics players. The newspaper Handelsblatt said the supervisory board of Deutsche Bahn, which also owns international forwarding giant Schenker Stinnes Logistics, was meeting late last week to consider approval of the purchase. With nearly $3 billion in revenue projected this year, BAX Global already is one of the world’s largest forwarders and logistics companies. Its air and ocean strength, combined with the international network of Schenker, would offer a strong response to the merger and acquisition frenzy capped by Deutsche Post’s recent bid for Exel. BAX was left sitting alone atop its North American base market with UPS’s recent acquisition of Menlo Worldwide Forwarding, which for years as Emery Worldwide divided the U.S. market for overnight heavy air freight delivery. California-based BAX still includes a North American integrated heavy freight network backed by 18 aircraft operated by BAX subsidiary Air Transportation International. That airline likely would have to be spun apart from BAX, just as Airborne Express shaved its airline business off when DHL bought Airborne a couple of years ago. BAX has already gone through a restructuring to make itself available for sale. BAX had a $47.2 million operating profit in the first nine months of this year on more that $2 billion in revenue as it appeared to be on its firmest financial ground in several years. The carrier’s $22.2 million operating profit in the third quarter was more than 50 percent better the same quarter last year and the best BAX has reported since the air shipping boom of the late 1990s. The revenue improvement suggests BAX is thriving in its market since UPS swallowed up Menlo Forwarding. Once identified as almost exclusively an air freight provider, BAX has developed a strong ocean business in recent years. Its business was built around the United States and now counts the majority of its revenue from international shipping. North America supplied $937.3 million in revenue and $10.6 million in operating profit in the first nine months of 2005 against nearly $1.2 billion in revenue and $50.5 million in profit from international. Although independent analysts have not compiled full market share figures, cargo industry observers say BAX appears to be winning market share this year at the expense of its leading heavy freight competitors. BAX’s 20.1 percent expansion in revenue in the quarter to $738 million looked to be ahead of the larger air freight market in what is shaping up as a soft year for expedited shipping. Americas region revenue grew 11 percent in the third quarter and shipment volume was up 4 percent. But that growth also reflects BAX’s drive to spread its business into the wholesale market. A service aimed at air freight forwarders – and at building density in its domestic air and ground network with the common carriage business – is growing rapidly and now counts some 200 customers, officials say. But expedited traffic also lagged behind growth in deferred volume, reflecting the changes in the North American market that have pushed BAX to expand into the ocean arena and build up its international logistics capabilities. “BAX Global posted its best quarter in recent years as its operating margin reached 3 percent driven by growth in (the) Asia-Pacific and improved performance in the Americas,” said Michael T. Dan, chairman, president and CEO of The Brink’s Co.
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Long rumored as a takeover target, the company was part of the Pittston Co., the coal mining concern that has faced heavy liability in black lung disease legal cases. Pittston officials said its potential liability in those cases was attached to its assets, including subsidiaries such as BAX. Richmond, VA-based Pittston recently carved its non-mining units – BAX and Brink’s Home Security – into separate companies and officials said the business could be sold separately without the liability. HP’s two-pronged approach [by Ian Putzger, The Journal of Commerce, September 6, 2004, pg. 60]
Hewlett-Packard works with carriers but still uses intermediaries Hewlett-Packard Co. used to let its logistics providers handle dealings with the carriers that transported the computer-equipment maker’s goods. Then HP acquired Compaq Computer last year, making a big company even bigger. With $1.7 billion to $2 billon in annual supply-chain spending, HP has become more assertive. Robert Gifford, who headed Compaq’s logistics before the merger and who now is vice president for worldwide logistics and program management at Hewlett-Packard, said he enjoys dealing directly with carriers – partly to give carriers a better understanding of HP’s strategy and needs, but also to help the company apply its leverage to secure favorable pricing and access to capacity. But HP’s new strategy doesn’t mean the company is cutting its third-party logistics providers out of the loop. On the contrary, it still relies heavily on them. Although HP uses its volume to help secure attractive rates from carriers, Gifford has no intention of bypassing its forwarders. The company still relies on its logistics service providers – LSP’s in HP parlance – to handle day-to-day relations with carriers. This setup leaves little room for the “fourth-party logistics providers” that some shippers employ to coordinate the work of 3PLs. Gifford has retained a few 4PLs that he inherited in the merger, but otherwise he has little interest in the concept. “Some of the value propositions of a 4PL – for example, leveraging volumes – aren’t useful to us,” he said. HP accounts for about 8 percent of total air-cargo capacity from Shanghai, he pointed out. “There’s little point to allow a 4PL to contract freight when I can contract it for much less.” While HP determines the choice of transportation companies, it’s up to the forwarders to make operational decisions such as whether to trim costs by shifting traffic from air to a combination of water and air shipment or using more regular airfreight to reduce spending on premium courier services. Whatever the transportation arrangements, however, HP wants the cost to be superior to the competition’s, Gifford said. “We give logistics companies a lot of leeway. We look for them to be more than direct labor,” he said. Hewlett-Packard wants its forwarders to select the optimum transportation arrangements, using HP’s volume as leverage, and to use their information-technology capabilities to improve service and reduce costs. BAX Global, the Irvine, Calif., logistics provider, has worked with HP for more than a decade. “The biggest challenge is dealing with their volumes,” said Joey Carnes, president of BAX Global. “With anything that HP does, there are volume challenges. If they shift sourcing from one country to another, we have to make a lot of capacity arrangements – not just securing lift, but also engineering ground solutions, setting up staging areas and warehouses.” Another priority in HP’s supply-chain strategy is to simplify procedures and reduce the number of times its freight is handled, Carnes said. This objective is reflected in HP’s moves to extend its logistics leverage second-tier suppliers and to make procedures in its supply-chain network as uniform as possible. A key component in this push for common ground is information technology, a key criterion in selecting logistics providers. “The first thing is to make sure the systemic architecture they are planning to use is state of the art, is providing a value,” Gifford said. “I firmly believe that the investment we see from our LSPs in their systems gives us a competitive advantage. Developing the necessary systems and interfaces requires time. Gifford is interested in robust, long-term relationships that give his logistics providers enough time to bring their full potential to bear in the partnership, but he doesn’t want them to get too comfortable. Hence, contracts are often for two or three years, sometimes a little longer, he said. In recent years, HP has reduced its number of logistics partners by more than 30 percent. Gifford said that this process has pretty much run its course. He has no ambition to end up with a one-stop solution. “We’re going to use multiple providers. We want competition,” he said. While it is pushing its logistics partners to optimize solutions, the manufacturer has also turned its supply-chain efforts inward. Talks with carriers are not just about explaining HP’s strategy and leaning on them for lower rates. These discussions also expose HP staff outside the logistics loop to the world of supply-chain planning. Among other insights, this has taught package design engineers what the cross-section of a freighter aircraft looks like and how pallet positions are best used. HP has a “Design for Supply Chain” program, which is permeating the organization, Gifford said. In one recent instance, this resulted in changes that allowed the manufacturer to load 8 to 15 percent more product in the same space. New BAX Global Ventures in Shanghai and Guangzhou Will Spearhead Expansion Plans in China Shanghai, China – January 10, 2005 – Bax Global has formed new subsidiaries in Guanghzhou and Shanghai to coordinate the development of its rapidly expanding service network throughout China. BAX Global Freight Forwarding (Guangzhou) Company Limited and BAX Global (China) Co. Ltd., both Wholly Foreign Owned Enterprises (WFOE), established under the Closer Economic Partnership Arrangement (CEPA). Through these new subsidiaries, BAX Global will provide a broad spectrum of integrated logistics services, including international and domestic air freight, ocean freight, exhibition support services, related trucking and transportation consulting services and supply chain management. BAX Global has been well established in China since the early 90s and was one of the first international forwarders to open a representative office in Beijing. The head office for BAX Global China will be at its Shanghai WFOE. The company’s current network of representative offices spans three regions: Northern China with Beijing, Dalian, Quingdao, Tianjin, Xi’an; Eastern China with Fuzhou, Nanjing, Ningbo, Shanghai, Suzhou; and Southern China with Dongguan, Guangzhou, Shenzhen Xiamen, and Zhongshan. The network provides quality transportation and supply chain management services for its global and local customers in select industries, such as high-tech, electronics, medical, healthcare, retail, fashion and aerospace. Andrew Jillings, BAX Global’s vice-president for North East Asia said, “The formation of these companies will enhance significantly BAX’s ability to meet customers’ service requirements throughout China. The new companies will allow BAX to directly book space, first with ocean carriers, and later with air carriers.” In addition, the company can now provide direct invoicing and a host of ancillary services including Customs, commodity inspection and insurance brokerages as well as bonded and non-bonded warehousing, and other related services. Steve Dearnley, president of BAX Global for Asia Pacific said. “China is an important market and production base for today’s global
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economy. As a fully licensed logistics provider, BAX Global is positioned for growth, with wholly controlled entities allowing maximum flexibility to suit customers’ specific requirements. BAX Global provides global freight management service to Raytheon [eyefortransport, 8/24/2004]
BAX Global recently signed a five-year agreement to provide worldwide transportation and logistics management services for Raytheon Aircraft Co. BAX is facilitating all manufacturing-related ocean inbound and outbound, including aircraft fuselage and wings shipped in specialized ocean containers from the United Kingdom to Wichita, Kansas. Additionally, BAX is co-coordinating inbound air transportation of parts and products to support manufacturing, and certain aircraft parts replenishment for aircraft maintenance. John Carr, president of Supply Chain Management at BAX Global said: “BAX Global provides flexible, value-added logistics services that go far beyond just transportation and distribution, providing customers with cost-effective and efficient solutions.” Transportation is just one component of the agreement. BAX will facilitate supply chain freight management for Raytheon Aircraft, including tactical, transportation optimization, carrier and contract management, claims management, premium freight management, and freight bill audit and reporting. To spearhead full deployment of BAX’s transportation and supply management services, BAX personnel will be on-site at Raytheon Aircraft’ s Wichita manufacturing facility.
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Company Name Belfor Logistics N.V. Address: Noorderlaan 76, Antwerp, B-2030 Belgium Phone Number: 32-3-231-29-35 Email Address: Fax Number: 32-3 -234.02.24
[email protected]
Website Address: www.belforlogistics.com
Subsidiaries or Related Companies Lloyds Freight Forwarder Asset Focus: N,A (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: Market Area: Founding Business: Int'l
OVERALL CAPABILITY
Overall Capability of Provider: Capable project logistics 3PL.
KEY PERSONNEL
Luc De Smedt Pol Nelen Leo Moonen General Manager Forwarder Forwarder
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 10 5 * 100 10 1-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Owned Warehouses/DC's: (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Computers, Electronics Technology
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Aveve Deutsche Babcock Aulag Gecamines Nasser Industrie
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Belfor Logistics Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Misc. Misc. Misc. Misc.
Philips Consumer Electro Computers, Electronics TAS Tractebel Engineering Viny Thai Trectabel Misc. Technology Misc.
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Belgium
Belfor Logistics North America South/Latin America
EDITOR'S COMMENTS
Belfor (Belgian Forwarding) Logistics, provides transport logistics (project logistics), encompassing land, sea and air traffic. The company emphasis is in organizing and coordinating transportation of industrial projects and conventional cargo through any port, worldwide. Provider's Strengths Project logistics. Provider's Weaknesses Agent dependance - limited range.
CASES & NEWS
During the last years, the BELFOR LOGISTICS team, on behalf of various important principals, has fixed and accomplished to the entire satisfaction of all parties concerned, the co-ordination of following important transports: Direct transhipment in Antwerp of 5 transformers, 150 T. each, and dispatching of same all over the world. Transport of a 1.000 MT k.d. rolling bridge as from Lauterbourg (France) up to Sollac, Fos sur Mer. For account of Messrs. Arsopi from Leixoes to job-site Interox/Solvay, Deerpark U.S.A. via Houston on board of a self-sustained heavy lift carrier of 12 boilers on skids, total abt. 392 T./2.750 m3 with a.o. following units : 1 x 160 T., dim. 41.1 x 4.8 x 4.6 m 1 x 75 T., dim. 39.5 x 4.6 x 4.6 m, 1 x 60 T., dim. 24.0 x 5.5 x 4.7 m Antwerp/Casablanca - 52 passenger railway wagons with a unit weight of abt. 34 T. from the Belgian railways, S.N.C.B. with special RO/RO vessels for account of the Moroccan O.N.C.F. in Rabat. Several shipments of Siemens air intake system project material to Spain and North Morocco - +/- 2/3.000 m³ per shipment. Antwerp/Banjul – a complete alternative energy installation ex Sodeco in Brussels for account of Belgamil, Banjul in Gambia. Supply on turnkey basis of the complete air-conditioning equipment destined for the Nasser Institute in Cairo (Egypt) via the port of Alexandria. The general co-ordination and the transport of the material and equipment destined to the TAS construction plant in Libya via the port of Tripoli. Antwerp/Yaounde - for account of AVEVE, the transport and delivery on site at Yaounde in Cameroun, via the port of Douala, of a complete industrial milk complex. Antwerp/West Africa - for account of Phillips Kommunikations Industrie and Cablerie de Lyon, transport and delivery of several thousands of tons of electric cables on reels, destined to various African countries. North Europe/oversea - for account of the main pipe producers, several thousands of tons of cast iron steel pipes to Africa, Central America, the Near an the Far East. North Europe/oversea - on behalf of several European colleagues, the negotiation and chartering of several vessels for big industrial turnkey projects, destination Indian Ocean, Nigeria, Algeria, Morocco, Irak and New Guinea. For account of Deutsche Babcock Anlage, Kulmbach and SEE, several water treatment industrial project, destination Algeria. Antwerp/Kolwezi-Likasi (Congo) - Transport contract for Gecamines of 15.000 T. sodium sulfhydrate in drums, i.e. full co-ordination as from FOB Antwerp up to delivery Shaba initially via Matadi, Kinshasa, Ilebo and today in a record time of total transit Antwerp/Kolwezi-Likasi via Durban of 46 days. Also Dar Es Salaam has been used later on to secure timely supply of above basic needs. Apart from the aforementioned traffics, we are daily rendering personalised transport services, directly and indirectly, to a great number of petroleum companies, for who's account we plan and manage each year the routing of several thousands of tons of steel casings with A.P.I. standards, as from the supplying works, all over the world, up to the consuming areas in the Arabian Gulf, Africa and South East Asia (Batam, Labuan, Kemaman and Kuantan). For account of Tractebel Engineering Int./Elecnor and R.M.T. the transport of Senelec equipment a.o. the 225 KV line Tobene-Sakal in Senegal and Mauretania.
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We signed a shipping and barging contract to transport out of gauge and heavy lift pieces from Leixoes (Portugal) up to Jemeppe sur Sambre (Belgium) for account of Interox International (joint venture between Tractebel/Solvay/Coppée Courtoy). We completed the forwarding of about 32.000 FT project material from the North Continent of Europe plus the States to the Map Ta Phut P.V.C. plant via Sattahip port (Thailand). Our principals were Vinythai in Bangkok and Tractebel Industrie/Solvay in Brussels. Furthermore we co-ordinated the transport logistic of several huge power station projects for account of Messrs. Cockerill Mechnical Industries to Bahrain, the Emirates, to Rayong in Thailand and Mexico (Rio Bravo project). For account of Messrs. Arsopi and John Brown, we co-ordinated a huge multi-modal transport of 6 exceptional heavy and out of gauge lifts weighing max. 150 T. upto 45 m long, from Leixoes by means of a self-sustained heavy lift carrier to Hamburg, from where special barges carried the cargoes to Aken on the Elbe and finally reached the Solvay Bernburg works by multi-wheeled extendable low-bed trailers. We also succeeded in efficiently co-ordinating the multi-modal transport from Antwerp to final job site Mindelo (Cap Vert) including erection, of a complete desalination plant total 600 T./2.500 m3 including HEAVY LIFT over 300T unit weight, transported in one shipment on board of a specialised RO/RO heavy lift carrier. For account of Messrs. Heurtey Petrochem Engineering from Antwerp to job-site delivery the A.Y.T.B. Yard in Al Jubail by means of a selfsustained heavy lift carrier, the VCM expansion project consisting of in total 37 packages for 278 T. including two heavy lifts of 110 T., dim. 17.3 x 2.7 x 4.07 m and 40 T., dim. 19.47 x 52.0 x 5.11 m Transport and logistics of the Sodi Devnya Project (Bulgaria) about 2.000 cbm / 500 mt of heavy lift and out of gauge cargo from North/South Europe via Antwerp and Lyon to Devnya-Varna (Bulgaria). Indupa S.A.I.C. PVC Expansion project in Bahia Blanca Argentina. Ca 10.000 freighttons generals + heavy lift cargo, autoclaves in one shipment from ex Japan + USA + European factories up to free on truck jobsite Bahia Blanca. Hispavic PVC Plant. One shipment ca. 4000 freighttons from ex Japan + European factories upto Martorell via Barcelona. Coek Engineering about 4.500 freighttons heavy lift + out of gauge petroleum equipment - project cargo - in one go from FCA Factory in Belgium upto Bandar Emmam Khomeini - Iran. Transport of 16 modules ca. 150 tons U.W. each for the Tucuman project - Argentina via Buenos Aires for the account of Cockerill Mechanical Industries. In 2000 we started chartering and sea transportation of different polymers, Polyethylene products ex Ras Lanouf (Lybia) for storage and distribution to several European destinations. (annual abt. 30.000mtons)
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Company Name BettR Logistics Address: Strationsstraat 83, 9900 Eeklo, Belgium Phone Number: 32 9 343-82-00 Email Address: Fax Number: 32 9 343-83-94
[email protected]
Website Address: www.bettr.be
Subsidiaries or Related Companies Asset Focus: N
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 2001 Market Area: Founding Business: Europe (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Small European SCM.
KEY PERSONNEL
Piet Lips Frank Verhaest Hans Borgers CEO Int'l Bus. Dev. COO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 25 5 * 73 30 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Consumer Goods Food, Groceries
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
California Direct Hain Celestial Ontex
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by BettR Location
Belgium Belgium Belgium
Industry
Food, Groceries Food, Groceries Consumer Goods
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
BettR South/Latin America
EDITOR'S COMMENTS
BettR is a TMS specialist with optimization capability. BettR is a good solution for medium to small sized companies. Provider's Strengths Flexibility and quick response. Provider's Weaknesses
CASES & NEWS
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Company Name Birkart Globistics (Thiel Air & Ocean) Address: Weichertstrasse 5, Aschaffenburg 63741 Germany Phone Number: 49-6021-343-0 Email Address:
[email protected] Fax Number: 49-6021-343-4999 Website Address: www.birkart.com
Subsidiaries or Related Companies S + H Logistik Asset Focus: A ANSH e-lifestyle fashion GmbH Thiel Logistik (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Thiel Logistik Int'l Freight Forwarding Year Started in Logistics: 1877
OVERALL CAPABILITY
Overall Capability of Provider: Good garment and fashion industry provider with Asian connections.
KEY PERSONNEL
Detlef Kuekenshoener Michael U. Villinger Dr. Peter Straube Friedhelm Schmitter
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 1,300 40 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) 450 * Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 200 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 200 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 98 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 1 (Million) 50
Asset Ownership v.s. Leased: Transportation Equipment: Mostly Owned Warehouses/DC's: Mostly Owned
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: >100000 Total Annual Airfreight Tonnes: >10000
MARKETS
Automotive Technology Computers, Electronics Consumer Goods
(For functional specializations, see "Customers" section.)
Healthcare Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Germany Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Applied Films Bayer Ciba-Geigy Cummins Engine Dell Computer Hugo Boss Johnson Controls Mitsubishi Siemens Toshiba Volkswagen Woolworths
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Birkart Location
Int'l Int'l Int'l Int'l Int'l Int'l Int'l Int'l Int'l Int'l Int'l Int'l
Industry
Technology Healthcare Healthcare Automotive Computers, Electronics Consumer Goods Automotive Automotive Healthcare Computers, Electronics Automotive Retailing
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa
Morocco South Africa Tunisia Turkey
Countries served through owned offices or agents Australia / Pac.Isles
Australia
Birkart North America
United States
Asia
Bangladesh China Indonesia Korea Malaysia Philippines Singapore Taiwan Thailand Vietnam
Europe
Austria Belgium Czech Republic France Germany Hungary Italy Lithuania Macedonia Netherlands Poland Portugal Romania Russia Slovakia Spain Switzerland United Kingdom
South/Latin America
Uruguay Argentina Brazil Peru
EDITOR'S COMMENTS
Emphasis is on clothing, pharmaceuticals, warehousing and value added services. Has offices in Chicago, New York, San Francisco and Los Angeles. Provider's Strengths Value-added warehousing and handling of garments and pharmaceuticals; Thiel relationship. Provider's Weaknesses
CASES & NEWS
MARCH 2004 - Since February 2004, the former BIRKART AUSTRIA Internationale Spedition GmbH has been operating under the name of BIRKART GLOBISTICS Austria GmbH. The change of name marks the completion of an internal restructuring programme. The company now focuses completely on international branch solutions for fashion and lifestyle logistics as well as air and sea-freight. BIRKART GLOBISTICS is a member of Thiel-Logistik AG which employs almost 11,000 people at 350 locations worldwide. Within this group, Birkart is responsible for the branch solutions Fashion and Lifestyle and Air and Oceanfreight. "In order to concentrate fully on these core competences, we"ve removed classic forwarding services from our portfolio", says Andreas Kerschner, Managing Director of BIRKART GLOBISTICS Austria. The forwarding locations in Innsbruck, Graz, Klagenfurt and Linz have been taken over by Quehenberger, the Thiel Company responsible for forwarding and the Austrian general-cargo network. BIRKART GLOBISTICS Austria is now in a position to concentrate fully on servicing the entire supply chain for the international fashion and lifestyle industry. To fulfil this aim, Birkart uses ships, planes, trains and trucks, and a state-of-the-art IT system provides transparency along the entire value-creation chain " from the manufacturer right through to department stores and boutiques. Leader in the hanging-garment transportation market BIRKART GLOBISTICS Austria employs 270 people in Vienna, Linz and Salzburg. In the fashion sector it is very important to transport garments on hangers. "Here we are the undisputed market leader in Austria. We handle 10 million pieces per year and currently hold a market share of 70 percent", says Kerschner. All goods received in flat packs are prepared for "hanging transport" using steam tunnels and dolls to ensure that they are crease-free. Among Birkart"s customers are renowned companies such as C&A, Woolworth, Peek & Cloppenburg, Adler, New Yorker, Zara and the underwear manufacturer Skiny. Another of Birkart"s core competences is in the Lifestyle sector, where it provides logistics services for perfumery and drugstore articles as well as accessories. Birkart delivers to all Douglas stores in Austria, for example. And the garden-centre chain Bellaflora is also a Birkart customer. Birkart offers a wide range of value added services such as warehousing, labelling, price tagging, theft proofing, the management of returned goods and the disposal of packaging. Delivery in pre-defined windows BIRKART GLOBISTICS Austria offers customers Austria-wide distribution and delivery direct to the point of sale " even in inner-city and pedestrianised areas. "Our distribution concept maximises bundling effects", says Kerschner. "This allows us to minimise the added costs incurred through road transport and enables us to offer our clients top prices." The delivery schedule is adapted to suit our customers" internal processes perfectly." In addition to the further expansion of nationwide fashion and lifestyle logistics, BIRKART GLOBISTICS Austria is also planning to increase its presence in Eastern Europe. One of the main focuses here will be on logistics for commission processing transactions. Kerschner: "Now that the restructuring programme has been completed we can concentrate fully on our core competences and customers can profit from our comprehensive branch know-how." Birkart leads with textile logistics and air and sea cargo Thiel Logistik sets course for the future August 2003 saw Thiel Logistik AG present its new strategy which will organise the Group into two divisions: specialised branch solutions and regional logistics. Media, Fashion & Lifestyle, Furniture, and Automotive were defined as the key areas in which Thiel could gain and
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maintain leading positions in the short and medium term. The forwarding agencies of the company like Birkart, Quehenberger, Südkraft, Delacher and will carry out the regional and traditional logistics. Birkart will be responsible for the branch solutions Fashion & Lifestyle and Air& Oceanfreight. Fashion in focus The market leadership of Birkart Globistics and dks DEUTSCHE KLEIDERSPEDITION in textile logistics provides the basis: All Thiel"s fashion and lifestyle activities will be bundled together to form a complete system, positioned under the brand name Thiel FashionLifestyle. The entity will be managed by Detlef Kükenshöner, Friedhelm Schmitter and Dr. Peter Straube. Managing Director Detlef Kükenshöner: "The company spanning integration of all branch activities in only one strategic entity will best suit to optimise operations. In the long run this guarantees our customers top service with a branch-specific portfolio." As with all Thiel Logistik branch solutions, the value chain will be managed using holistic systems. Advantages for customers: value-added services, logistics and supply chain management from a single source with binding, calculable prices per unit along the entire intercontinental supply chain. New concepts will create the highest level of transparency. Air and sea cargo with intercontinental logistics Transport logistics, supply chain management, value-added-services and distribution logistics are the core activities of BIRKART GLOBISTICS" business unit Air- & Oceanfreight. In the future this is where the Air- and Oceanfreight activities of the company group will be brought together. Headed up by Michael U. Villinger this strategic unit will organise and manage all intercontinental activities of the Thiel Logistik AG " with the support of Dr. Peter Straube in the areas of finance, human resources and general administration. Birkart"s global network of subsidiaries, branch offices and partners in Asia, Australia, South Africa and North and South America will play a key role for the Air- and Oceanfreight unit. "Within the Thiel Group Birkart operates the largest intercontinental branch and partner system. From now on all Thiel companies can benefit from country specific know how in more than 50 nations", says Managing Director Michael U. Villinger. Thiel Logistik AG takes over majority of Birkart Globistics [via website March 22, 2002]
Thiel Logistik AG has acquired a majority of the business divisions of Birkart Globistics AG, Aschaffenburg. This will enable the Luxembourg-based company to enter the innovative Fashion Logistics sector and to expand its activities in Europe, Asia, Africa, the Americas and Australia. The financing of the takeover will be divided in about thirds between liabilities, cash, and the issue of approximately 1.2 million new shares. Birkart was founded in 1877 and has 3,500 employees worldwide. Out of the acquired business divisions with almost 3,000 employees Thiel expects net sales of about EUR 410 million, with an EBIT of EUR 8 to 9 million for 2002. As a result of the takeover Thiel Logistik AG has increased its financial planning for the year 2002 substantially. Thiel is now expecting total sales of EUR 1.616 million and an EBIT of EUR 109 million. To meet the new challenges Thiel Logistik AG strengthens its Board of Directors. Newly appointed is Christian Furstaller (operations), Chairman of the Board of Directors of Quehenberger Logistik AG, Salzburg. New designated members are Stefan Delacher (marketing), Chairman of the Board of Directors of Delacher Logistics AG, Wolfurt, and Prof. Andreas Goldschmidt (research, education, and training), Chairman of the Divisional Board of Directors of Thiel HealthCare Logistics & Services. The current CIO, Dietmar Ley, leaves the Board of Directors and shall be elected to the Advisory Board.`
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Company Name BLG Logistics Group Address: Prasident-Kennedy-Platz 1A, Bremen 28203 Germany Phone Number: 49-421-39801 Email Address:
[email protected] Fax Number: 49-421 3983404 Website Address: www.blg.de
Subsidiaries or Related Companies BLG Automobile Logistics A BLG International Logistics Eurogate E.H. Harms Auto Transporte
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Bremer Lagerhaus-Gesellschaft … 1877 Asset Focus: Europe Freight Forwarding (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1970
OVERALL CAPABILITY
Overall Capability of Provider: Capable finished automotive logistics company with large car carrying operations.
KEY PERSONNEL
Detthold Aden Holger Wohlleben Manfred Kuhr President Ingo Peters Hillert Onnen Controller Finance
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 880 880 * 6,100 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 2,000 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 2,000 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 2 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Owned 1 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Consumer Goods Healthcare
(For functional specializations, see "Customers" section.)
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): e.TLS/LOON Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition SAP R/3 EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling e.TLS/LOON
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Germany Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Audi Bosch DaimlerChrysler Ford Motor IKEA Mercedes-Benz Minolta Opel Porsche Siemens Tchibo Volkswagen
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by BLG Logistics Location
Hungary
Industry
Automotive Automotive Automotive Automotive Retailing Automotive Consumer Goods Automotive Automotive Healthcare Consumer Goods Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Germany
Brazil, South Africa Europe
Europe Germany, South Africa
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Germany
BLG Logistics North America
United States
South/Latin America
EDITOR'S COMMENTS
Emphasis is on automotive logistics through Bremerhaven. BLG has extensive car carrying business for VW and DaimlerChrysler. Provider's Strengths Automotive logistics. Provider's Weaknesses Limited scope.
CASES & NEWS
New Contracts With Shipping Company and manufacturer Customers [via website, July 3, 2006] BLG LOGISTICS recently signed new contracts with Norwegian automobile shipping company Höegh Autoliners and car manufacturer Mazda. Höegh Autoliners loads and discharges around 100,000 vehicles a year at the Bremerhaven Auto Terminal. The shipping company serves all routes around the globe. In Bremerhaven its customers include DaimlerChrysler and BMW. Through Höegh Autoliners Germany GMBH the shipping company has its German headquarters in Bremen. The new contract runs until the end of 2008. The second new contract applies to Mazda. The Bremerhaven Auto Terminal has already been working as a hub for the car manufacturer for the Scandinavia and Baltic routes for two years now. The vehicles coming from Japan and England were stored temporarily in Bremerhaven and transported further via feeder vessels. An additional contract for vehicles to Russia has now been concluded with Mazda Logistics Europe in Brussels. The scope of the contract also encompasses technical services on around 30,000 vehicles a year. Prior to further shipment the vehicles undergo pre-delivery inspection (PDI) and other technical work at the technical center of the Auto Terminal. Bremerhaven has already been performing these services for Mazda vehicles to Denmark, Sweden and Norway for two years. In 2005 340,000 vehicles were processed at the Bremerhaven technical center, the largest automobile workshop in Europe. Over 400,000 vehicles are expected for 2006. Automotive drives strong BLG results [Transport Intelligence, June 9, 2006]
German logistics group BLG reported that sales in 2005 rose by 10.3 percent to €701.7 million and earnings before taxes (EBT) increased by 63 percent to €49.7 million. The positive development was achieved through growth in existing business and also by virtue of new commitments at home and abroad. BLG’s Contract Division recorded 6.2 percent growth to a sales level of €192.9 million in 2005. The EBT increased by 1.2 million to €6.9 million. Besides activities in automotive parts, industrial and trade logistics, BLG also concentrated on conventional seaport logistics as well as cold store and deep-freeze logistics. BLG’s joint network with E.H. Harms Automobile Logistics, handled a total of 4.1 million vehicles (previous year: 3.8 million). The strongest location in the network is Bremerhaven. Over 1.6 million vehicles were handled there in 2005 (+14%). In addition, 340,000 vehicles were processed at the Bremerhaven technical centre. The sales in the AUTOMOBILE Division rose by 12.6 percent to €253.2 million and the EBT from €253.2 million and the EBT from €8.8 million to €14.1. BLG Secures Additional Logistics Space in Bremen, Reports Sales up 24% for Auto Division [Eyefortransport, April 6, 2006]
On the basis of a long-term lease, BLG’s Contract Division has secured for itself more than 100,000 square meters of area with 60,000 square meters of covered low-level warehousing space between neustadter Hafen and the Freight Traffic & Logistics Centre in Bremen. The facility will be set up immediately next to the high-bay warehouse, which BLG operates exclusively for the consumer article business of its major customer Tchibo. A road tunnel will link to two complexes. The Bremen Freight Traffic and Logistics Centre belongs to the “Champions League” of Germany’s freight traffic centres, according to the current ranking of the newspaper Deutsche Verkehrs-Zeitung. The centre will be linked directly to the A1 motorway via a section of the A281 autobahn by the end of 2007. During the first construction phase, a low-level warehousing facility with an area of 10,000 square meters will be built on the grounds of Bremen’s Freight Traffic & Logistics Centre. Completion is scheduled in September. By the end of the year 40,000 square meters will be ready for use. The entire complex is to be available in February 2007. In other news, after an increase of around 14% to more than 1.6 million vehicles last year, BLG’s Automobile Division showed further substantial growth n the first quarter in 2006. In the first three months of this year, BLG’s Automobile Division recorded 426,000 vehicles in Bremerhaven, the largest automobile terminal in the network. This represents a 24% increase in sales compared with the same period in the previous year. The strongest month was March 2006, with 160,000 vehicles, the highest monthly results since the beginning of automobile handling in Bremerhaven.
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Jaguar imports via Bremerhaven These days BLG Logistics handled the first 25 new vehicles of the Jaguar brand. The manufacturer shifted its logistics from Vlissingen to Bremerhaven. Companies belonging to the business division BLG Logistics Automobile accomplish the logistical care. The technical centre of E.H.H. Autotec takes over the cars ex-vessel and carries out de-conservation on request of the car dealer. E.H. Harms Automobil-Transporte delivers the cars by truck directly to the German dealership. The annual volume will reach up to between 5,000 and 7,000 units. From several production sites in Britain the cars arrive via Grimsby with the Feeder ships of KESS (“K” Line European Sea Highway Service) in Bremerhaven. The reason for the displacement was the merging of logistics for the brands of Jaguar, Land Rover and Range Rover. Land Rover and Range Rover are being imported via Bremerhaven for 13 years already and undergo the pre-delivery-inspection there. Due to the merging the manufacturer achieves a leaner and better processing than today. Mazda vehicles for Scandinavia via Bremerhaven April 7, 2004 - 1,059 Mazda vehicles for Denmark, Norway and Sweden on board “K” Line were discharged in Bremerhaven recently. This was the first delivery within the framework of a new transaction between Mazda Logistics Europe N.V. and BLG LOGISTICS AUTOMOBILE. The new order encompasses a volume of around 15,000 vehicles a year. The reorganization of the supply chains for Scandinavia is due to the fact that the logistic responsibilities for these target markets have been restructured at Mazda, effective as of April 1 of this year. All automobiles coming on “K” Line directly from Japan to Bremerhaven get their pre-delivery inspection by E.H.H. AUTOTEC and are subsequently being transported on to Sweden and Norway via KESS feeder vessels (“K” Line European Sea Highway Services). The Danish market is served from Bremerhaven by truck. On the basis of the new order, Bremerhaven’s position as a hub for the Scandinavian region will be strengthened even more. Total cargo turnover at the BLG Auto Terminal in Bremerhaven is currently over 1.3 million vehicles a year. This makes Bremerhaven one of the leading automobile ports in the world and the strongest location in the BLG LOGISTICS AUTOMOBILE network. The total volume in the network rose last year to 3.22 million finished vehicles (previous year: 3.1 million). Auto technology closes ranks in Bremerhaven March 4, 2004 - BLG and E.H. Harms strengthen the productivity of their technical centers at the Bremerhaven Auto Terminal. Currently more than 400 employees work at the two centers. Initial inspections on new vehicles are carried out there and automobiles are equipped according to the individual demands of the buyers. However, a consistent utilization of capacity is not possible at the technical centers because the production figures of the automobile manufacturers fluctuate considerably. In addition, the value added per vehicle is declining due to new production strategies of the manufacturers. Besides other measures for the optimization of the technical centers, the consolidation in one company with a new name, E.H.H. AutoTec GmbH & Co. KG, is the most important step in this connection. It will bring about significant cost relief because employment in the administration office and in the plant will be reduced as a result of the concentration. New cooperation model for Wallenius Wilhelmsen November 14, 2003 - new model for ship clearance in Bremerhaven has been developed for the shipping company Wallenius Wilhelmsen Lines AS, market leader in worldwide transport of automobiles via the sea and main customer at BLG’s Auto Terminal. A working group formed at the initiative of Atlantik Hafenbetriebe (AHB), which has a 50% interest in Wallenius Wilhelmsen, had examined various options with terminal operator BLG AUTOMOBILE LOGISTICS and worked out the basis for the new operation. The objective was to optimize the loading and discharging processes, including IT management, and redefine responsibility. After the test phase the new model will be introduced on a binding basis at the beginning of 2004. It will then apply to all vessels of the Wallenius Wilhemsen shipping company. According to the new operation model, AHB as system supplier will be responsible for the complete process and act as exclusive contact for Wallenius Wilhemsen in the future. BLG is involved as a service provider within the framework of this cooperation. BLG’s service package at the Auto Terminal and in connection with loading and discharging vehicles essentially remains unchanged. The Boards of Management of AHB and BLG AUTOMOBILE LOGISTICS are convinced that the cooperation offers a solid foundation for binding Wallenius Wilhelmsen as a major customer to Bremerhaven. A cargo handling volume of around 1.4 million vehicles is again expected at the Bremerhaven Auto Terminal this year.
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Company Name C. H. Robinson Worldwide Address: 8100 Mitchell Road, Eden Prairie, MN 55344-9808 USA Phone Number: 952-937-8500 Email Address:
[email protected] Fax Number: 952-937-7858 Website Address: www.chrobinson.com
Subsidiaries or Related Companies T-Chek Systems Inc. N Payment & Logistics Services Inc.
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: C. H. Robinson Company Worldwide Asset Focus: Int'l Broker (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1905
OVERALL CAPABILITY
Overall Capability of Provider: Excellent transportation and special projects manager.
KEY PERSONNEL
John Wiehoff Jim Butts Mark Walker CEO VP Sales VP Transportation Kevin McCarthy Chris O'Brien Mgr. Logistics Analysis VP Transportation
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 5,689 880 * 5,776 7500 >1 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol CHRW Exchange: NASDAQ
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 100 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 2 (Million) 10
Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Mostly Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 10000 Total Annual Airfreight Tonnes: >1000
MARKETS
Agriculture Computers, Electronics Heating & Air Conditioning Print, Publishing, Newspape Transportation, Moving Automotive Consumer Goods Industrial Recylcing/Waste Beverage Containers Metals Retailing
(For functional specializations, see "Customers" section.)
Building Materials Entertainment Oil & Energy Technology Chemicals Food, Groceries Paper Telecommunications
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): COSMOS; Express Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Shippers Plus; ILOG, Bid Pro (CAPS) HighJump LogicTools--LogicNet Proprietary OMS
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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Other Systems Capabilities: Bar Coding Demand & Supply Forecasting
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Illinois Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
3M Amazon American Marazzi Tile Amstar Corporation Anchor Glass Anheuser Busch Anheuser Busch AOL Time Warner Arcata Graphics Aunt Jane Foods Ball Foster Glass Barmet Aluminum Beatrice/Hunt Wesson Berger & Company
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by C. H. Robinson Location
US Austin, TX
Industry
Technology Retailing Building Materials Chemicals Building Materials Beverage Beverage Entertainment Print, Publishing, Newspaper Food, Groceries Containers Metals Food, Groceries Recylcing/Waste
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Minneapolis, MN & regional
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COUNTRIES with OFFICES
Africa Asia
Hong Kong
Countries served through owned offices or agents Australia / Pac.Isles Europe
France Germany Hungary Italy Poland Spain United Kingdom
C. H. Robinson North America
Canada United States
South/Latin America
Mexico Argentina Brazil Venezuela Chile
EDITOR'S COMMENTS
C.H. Robinson continues to be the most profitable 3PL. John Wiehoff and his cohort of young execs continue to refine the excellent business model put in place by the founders. While most of Robinson’s revenues are transportation management related, it has solid services including domestic intermodal, international ocean, food sourcing, truck fueling and supply chain management. Employees are highly incented to take care of customers. European and Asian operations continue to grow. C.H. Robinson has made careful purchases of companies with specializations and has the free cash flow to make more. Provider's Strengths Strong business plan and excellent execution = quality company. Provider's Weaknesses
CASES & NEWS
Site Visit CH Robinson – Strength at the Core September 1, 2003 Recently, we had the opportunity to spend a couple of days with CH Robinson (CHR). CHR is expanding its offerings dramatically while preserving its core strength in trucking capacity management and supply. We spent a day at the CHR office in Milwaukee with Branch Manager Tom Donovan and his crew. I was impressed by the differences between Donovan’s operation and those of the transportation companies I worked in many years ago. The differences are central to CHR’s ongoing success. Here is what I saw: The salespeople, who also are responsible for operations, including carrier management and dispatching, are primarily college graduates (11 of 12 salespeople) who were hired right out of college and trained by CHR. All of the salespeople have reasonable base salaries and share in the branch’s bonus pool. Branch managers receive about two-thirds of their pay from the bonus pool of their branch. To our knowledge, only Expeditors provides incentives to non-executive staff as heavily. The office is organized with open space so that salespeople can talk and collaborate on shipments and problems. The cooperative atmosphere spreads throughout the place. Camaraderie and the “we’re all in this together” spirit predominate. Every customer has a primary point of contact, but all of the salespeople are responsible for insuring high quality service to the branch’s accounts, and are incented to do so through the performance compensation system. CHR has 150 offices operating with this same cooperative approach. The truck management operating system “Express” was originally obtained with the American Backhaulers purchase. It was then combined with CHR’s existing truck management system, Cosmos, The system continues to be expanded and modified. Express is easy to use. It provides easy access to shipments being handled in the CHR network (companywide, approximately 12,000 per day, including significant LTL volumes). A neat feature of Express is one-screen capacity mapping for North America. At a glance a manager can see where the freight imbalances are. For example, on the day of our visit Florida, Georgia and most of the East Coast had 5-6 times or more trucks as loads. California was 2:1. The upper Midwest, as it should be in late summer and fall, had more freight than trucks. In summary, CHR’s branch offices involve quality people maximizing opportunities for their customers with strong IT support. This model is antithetical to transportation management approaches in which people support software. The major difference is that CHR is an efficient, profitable company– major software dependent operators like Schneider Logistics and Transplace are unprofitable. CHR’s Home Office CHR is expanding its supply chain functionality organically. A major and important example is the shift to spread the capability of its Ross Division beyond publications to other verticals. The Ross Division handles processes from inventory management through customer delivery. CHR has built a European transportation capacity management operation based in Antwerp. This operation has traction and profitability. Indeed, the fragmental nature of European trucking is perfect for CHR’s approach. In addition, CHR’s freight forwarding operation continues to grow. This operation handles 80,000 TEUs per year. The majority is import, but a significant portion is export. The airfreight operations are project oriented. CHR has created a service called TMC, which also uses the Express platform. TMC is designed for large accounts who want to handle their transportation rate negotiation and some transportation management in-house. TMC executes their customers’ routing guides as a 4PL. In those situations, Robinson may also be a large carrier to the customer as well. Data reporting back to the customer is where CHR sees itself as excelling. This offering is a solid competitor to Schneider Logistics and other transportation managers who are selling their software to large accounts who insist on owning their transportation execution and planning. CHR continues to be very profitable and its prospects look great for the next several years. In our opinion, the major issue for CHR top management is how fast, and how best, to further globalize its operations.
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Trucking Logistics Firm Succeeds by Sweating Over Every Detail
[by Alan Elliott, Investor’s Business Daily, January 6, 2006]
Driving a truck isn't rocket science. Managing a truck fleet is darned close. Try booking each cubic yard of trailer space full through every mile traveled. Multiply that task across hundreds of fleets covering countless routes and endpoints. Then you'll get a workaday sense of CH Robinson Worldwide. CH Robinson is the largest freight brokerage firm in the U.S. The classic middleman, Robinson connects shipping orders to freight haulers . It leans heavily on fancy technology and number crunching to nail down schedules and keep trailers full, going and coming. Like most third-party logistics firms, Robinson charges a spread on the shipping cost. That spread has endured calisthenic strains through the past few years. The growing U.S. economy needed more truck-bed space. Indemand truck fleets notched up freight rates. Rising fuel prices set off rate surcharges. Unstable tariffs made imported-goods pricing a moving target. It was a push-pull that drove a startling number of truckers out of business. From 2000 to 2003, as many as 10,000 trucking firms — and even more independent drivers — went under. As the economy ticked back up, demand for shipping outgrew the supply of trucks. Many smaller truckers were no longer in service. Larger trucker fleets grew by concentrating on shorter hauls along the most lucrative "power" routes. It all strengthened Robinson's hand. "Robinson has benefited from a nearly ideal operating environment, namely a very strong spot market coupled with (the company's) access to small operator capacity," Stephens analyst Alexander Brand wrote in a November report. Robinson's balance sheet is free of hard assets like trucks and trailers. It thus sidesteps the costs of leases, fuel and upkeep that hit truck fleets between the eyes when the economy slows. That has helped Robinson log steady quarterly profit growth since it went public eight years ago. The firm saw double-digit earnings gains in the last eight quarters. Third-quarter profit was up 44% to 31 cents a share. Revenue rose 32% to $1.49 billion. Analysts polled by First Call see profit rising 43% to $1.13 a share for 2005, then moving up another 16% for 2006. The firm has no long-term debt. Logistics began as the art of housing and feeding armies of soldiers. Today the discipline is split among many industries and supply-chain segments. In transportation, the two most notable segments are freight brokers and freight forwarders. Forwarders oversee shipping over long-distance air and sea routes. Brokers manage the moving of domestic freight by truck and rail. The top 20 brokers control about a quarter of the market. Robinson, the largest, owns 10% of the total. Next in line are the Hub Group and Pacer Global, a unit of Pacer International. Richard Armstrong, chairman of logistics industry consultant Armstrong & Associates, says Robinson today acts as the de facto marketing and sales arm for many small to medium-sized carriers. While the firm owns no transport assets of its own, it commands capacity the way larger fleet operators do. "So they can make pretty significant commitments to people and deliver on them," Armstrong said. Robinson faces stiff challenges both at home and abroad. In the U.S., a shortage of truck drivers and loss of small and mid-sized truck fleets gives fleet operators the power to raise prices. That squeezes the logistics providers' spread. The fact that imports are hogging much of the rail system also cuts into brokers' options. Analyst Brand says the combination puts up a high hurdle to Robinson's effort to keep up the 30% net revenue growth on its trucking side through the past five quarters. "We believe this is unsustainable, especially as comparisons get more difficult in '06," Brand wrote in a November report. But opinions differ. Edward Wolfe with Bear Stearns sees Robinson's deals with smaller carriers as a key factor in future growth. "(Robinson's) growth should continue at least for the next few quarters, driven by greater availability of small vs. large truck capacity and continued stress on shippers," he wrote. There's more room for growth in the U.S. But the larger industry picture is one of consolidation. Global freight forwarders have been buying U.S. brokers and other logistics firms. They aim to provide single-contract services to ship imports to U.S. customers. Robinson has started to set up offices in Asia, South America and Europe. Intermodal shipping and air transport are two of its fastest growing segments. But the company is still mostly a North American outfit. The firm has said it is carefully eyeing buyout options. Armstrong sees an overriding push toward a union with a leading freight forwarder, such as Expeditors International. "Geographically and in terms of product offerings, the two would be a very complementary match and are both very well-run companies," Armstrong said. C.H. Robinson Acquires European Freight Forwarding Companies Minneapolis, September 1, 2005 – C.H. Robinson Worldwide, Inc. (C.H. Robinson) announced today that it has acquired in separate transactions, two freight forwarding companies, Hirdes Group Worldwide (Hirdes), and Bussini Transport S.r.l. (Bussini). The two companies combined had gross revenues of approximately $52 million in 2004. Hirdes provides air and ocean international forwarding with local cartage. Hirdes has seven locations in Germany and three locations in the United States. Terms of the acquisition were not disclosed. Hirdes was established in 1871 by the Hirdes family. Thomas Hirdes, 53, served as the chairman, president and managing director of U.S. operations and resides in Chicago, IL. Mr. Hirdes and the managing director of Germany, Peter Mundt, 45, will continue with C.H. Robinson. Hirdes has 92 employees, all of whom were offered employments with C.H. Robinson. Bussini provides international freight forwarding, customs brokerage, and domestic truck services. It is based in Milan, Italy. The company was founded in 1939 by the Bussini family. Allesandro Bussini, 27, will continue with C.H. Robinson as branch manager. As part of the acquisition, C.H. Robinson hired 27 employees. Terms of the acquisition were not disclosed. “Hirdes and Bussini are strong, successful companies and will be important additions to Robinson’s international freight forwarding network,” said Joseph J. Mulvehill, vice president, international, of C.H. Robinson. “Expanding our international network is one of our key long-term
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growth objectives and both of these companies will enhance our capabilities and our international relationships. They have great reputations in the industry and excellent track records. We look forward to having them on board Rooted in Logistics [by Chris Gillis, American Shipper, June 2005, pg. 48]
C.H. Robinson continues to shape the fresh product supply chain. What if an orange could tell a grocer where it was grown and what it went through to get to the store shelf? It may sound like a stretch of the imagination. But to Eden Prairie, Minn.-based third-party logistics services provider C.H. Robinson Worldwide that’s the wave of the future for the fresh produce supply chain. C.H. Robinson has invested heavily in various technologies, including barcodes and most recently radio-frequency identification (RFID) tags, to track produce from farms to store checkout aisles on behalf of numerous shippers and retailers. Two years ago, Wal-Mart told its top 100 suppliers it would require them to apply RFID tags to certain cartons and pallets of designated merchandise by Jan. 1, 2005. C.H. Robinson has worked with the retail giant for more than a decade and volunteered to participate in the RFID initiative. The company met Wal-Mart’s deadline on time. “No one at Wal-Mart told us that doing this we would gain more business,” said Jim Lemke, vice president of product for C.H. Robinson. “ We just wanted to be out in front of the group.” Wal-Mart asked C.H. Robinson to apply RFID tags to bagged oranges for its groceries. C.H. Robinson knew the task would be challenging, because oranges are subject to high moisture and cool temperatures, which could negatively affect the integrity and operation of RFID tags. The company worked with QLM Consulting to set up an RFID test center at New Star Fresh Foods produce warehouse in Salinas, Calif. “We wanted to make sure we tested this technology in as normal environment as possible,” Lemke said. The RFID tests were conducted in a small space at the far end of the 150,000 square-foot warehouse. C.H. Robinson installed tag readers over two dock doors and on the forklifts and racks used in the test. “We tag the bags at the loading dock and read them when they leave the facility,” Lemke said. The bagged oranges with RFID tags continue to be read throughout Wal-Mart’s distribution process until they reach the store shelves. Lemke said the technology is still 18 months to three years away from implementing at the farm level. “We’ll get to that point with RFID,” he said. Meanwhile, C.H. Robinson’s RFID work has attracted the attention of other food retailers, such as Albertson’s and Food Lion. “We’re thinking about what we’re going to ship using RFID and how to integrate the technology with our suppliers,” Lemke said. C.H. Robinson recently made RFID presentations to its top 10 produce suppliers and plans to begin working with five of them this summer to start implementing the technology. Information contained within the tags is customized to the individual supplier and stock-keeping units (SKUs). This means C.H. Robinson’s system must be able to identify hundreds of produce shippers and thousands of fruits and vegetables. For example, the company handles about 20,000 SKUs of apples alone. Another challenge for RFID, Lemke explained, will be the reduction in the cost of the tags. Currently, they range from 25 to 50 cents apiece for the simple reader tags to upwards to $8 to $12 each for those with more complex data inputs such as battery assisted temperature readers. “The industry wants to get it down to the nickel-per-reader tag level. This will only happen with increased use of RFID,” Lemke said. All Levels. For C.H. Robinson, produce logistics services have varying levels of depth depending on the customer’s needs. A number of fruit and vegetable shippers still contact C.H. Robinson for basic transportation services. “We have to be flexible,” said Brian Johnson, Eden Prairie branch manager for C.H. Robinson. “We have a lot of customers that operate off pads of papers. Our trucks still drive out to muddy fields to load.” Other shippers enlist C.H. Robinson to provide total logistics packages. Frito Lay, for example, uses C.H. Robinson to oversee its sourcing of raw potatoes. “We can’t let Frito Lay’s inventory expand beyond 24 hours,” Johnson said. “The company wants only the freshest potatoes on hand.” C.H. Robinson has more that 500 employees dedicated to its produce division. The company operates 14 service centers throughout the United States to provide services such as cross docking, load consolidation, repackaging, ripening, pre-inspections and local deliveries to retailers, food services and wholesalers. The company provides some produce shippers with brand management and product sourcing services. C.H. Robinson provides nine types of Washington state apples and six Eastern varieties for Mott’s. The company does similar work for Welch’s grapes and Tropicana oranges. To protect the integrity of each brand, C.H. Robinson audits each of its copacker’s growing practices. An inspection team ensures that the fruit meets the customer’s quality standards and a grower identification number is printed at the bottom of each bag of fruit to allow C.H. Robinson to quickly identify problems. In addition, a toll-free number is listed on each bag of fruit to help C.H. Robinson monitor commodities, retailers and other issues. C.H. Robinson accepts requests to develop similar programs for other types and sizes of produce receivers. After the commodities and their specifications are identified, the company will create the packaging graphics and manage product sourcing for private labels. C.H. Robinson also operates its own produce brand, called The Fresh 1. The company said its brand follows the same strict quality and food safety standards, and is audited by an independent third party. In February, C.H. Robinson increased its stake in produce sourcing by acquiring several companies specialized in the business. Monterey, Calif.-based FoodSource and its subsidiaries provide a variety of produce sourcing and distribution services including produce procurement, contract management, private label brand management, new product development, merchandising and transportation of produce. The FoodSource entities have about 260 customers, including large retail grocery chains, wholesalers, mid-range supermarkets, specialty food chains and food service distributors. The other acquired firms, Epic Roots, which is also based in Monterey, provides produce sales and product development and is a key partner of FoodService. Terms of the acquisitions were not disclosed. C.H. Robinson will source produce from overseas during the seasonal gaps in North America. When U.S. grapes are out of season, the company sources Chilean grapes of similar quality for Welch’s, Lemke said. The company also exports some U.S. produce overseas. C.H. Robinson’s non-vessel-operating common carrier service in Miami routinely consolidates containerloads of produce for markets in the Caribbean and South America. Logistics Influence. C.H. Robinson’s experience with produce has spilled over to how it manages the transportation and logistics of other types of shippers and their commodities. “We take a lot of time to understand the products we’re shipping, including their packaging and how they’re used,” Said Jeff Scovill, director of international forwarding at C.H. Robinson. Scovill said the company’s awareness of just-in-time services and ability to provide multimodal transportation for produce business has “
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definitely helped” C.H. Robinson to attract shippers from other industries, such as the electronic, footwear and pharmaceutical sectors. As with its produce business, the company also provides these shippers with access to a comprehensive online cargo management system. “We’re not offering shippers international services in a vacuum,” Scovill said. “It’s generally sold to them in a bundle. We feel it’s a strategic advantage to us to handle multiple modes seamlessly without changing providers and information systems.” Today, the company is considered one of the largest North American non-asset-based logistics providers. In 2004, C.H. Robinson handled about 150,000 TEUs of ocean freight and another 40 million pounds of air cargo. Last year, the company recorded gross revenues of $4.3 billion. C.H. Robinson grew its operating income to $222.7 million and net income to $137 million in 2004. This year is also looking bright for the company. C.H. Robinson also experienced a 43.7 percent jump in the first quarter net income to $42 million. Operating income during the quarter also increased 43.7 percent to $68 million, compared to $47 million in the year-earlier period. Expansion. C.H. Robinson continues to expand its operations overseas. Last year, the company acquired certain assets of Dalian Decheng Shipping Agency Co., allowing it to establish an NVO and freight forwarding presence in China, which it combined with its existing Hong Kong office. The company now has seven offices in China: Dalian, Tianjin, Qingdao, Shanghai, Ningbo, Xiamen, and Shenzhen. The company moved its Asian operations base to Dalian. The company has operated in the European truck and forwarding market for more than a decade. In September 2003, C.H. Robinson acquired of Hamburg-based forwarder Frank M. Viet GmbH Internationale Spedition. Today, the company operates about 15 offices across the continent. C.H. Robinson also operates a network of offices in South America, including Valencia, Venezuela; Sao Paulo, Brazil; Santiago, Chile; and Buenos Aires, Argentina. Today, C.H. Robinson has 178 offices, 4,800 employees, and about 18,000 customers. The company works with about 35,000 carriers worldwide. The company’s primary goal for overseas markets is to develop strong domestic transportation networks similar to what it has done in North America. “This is critical to our supply chain success,” Scovill said. “Ocean and air carriers provide the connection between the continents.” While produce logistics continues to be focused on North America, C.H. Robinson has not ignored the possibility of developing similar services with overseas produce shippers. “We’re definitely looking for this opportunity to evolve in China,” Lemke said. “Once we get a base of business going, then we’ll make our move.” One Truck at a Time [by William Hoffman, Traffic World, May 9, 2005, pg. 20]
C.H. Robinson turns to smaller carriers to build capacity, increase trucking profits in first quarter The boom in shipper demand for more and faster deliveries is changing the way C.H. Robinson Worldwide does business with its truckers, and with which trucking companies it does business. Increasingly it is using smaller carriers rather than larger competitors to meet shipper needs, C.H. Robinson executives said in reporting the company’s first quarter 2005 financial results. Small- to medium-sized trucking companies have been adding the capacity Robinson rode to a 36.4 percent year-over-year increase in gross trucking profits, the company reported. Two-truck companies are buying an additional truck, while four- and five-truck companies are adding a couple of trucks, Robinson CEO John P. Wiehoff told analysts during a conference call. By contrast, he said, driver and equipment shortages are slowing the biggest carriers. “It takes a little longer for the big guys to come back to us,” Wiehoff said. Probably related is a surge Robinson observed in demand for LTL service. That portion of the Minneapolis-based third-party logistics provider’s business roughly doubled, to 10 percent of truck revenue, from several years ago. Premium pricing for higher demand LTL service, along with Robinson’s leverage of its decentralized branch office network to win new, local accounts, confirmed the $1.2 billion company’s strategic focus on the LTL market, executives said. Shippers’ insistence on faster delivery, along with regional service disruptions, lane eliminations and increased costs, pushed freight off Robinson intermodal services and onto trucks. Robinson’s intermodal gross profit was off 6.8 percent in first quarter 2005 compared with the same period a year earlier. Robust economic performance that drove trucking demand also is changing the way carriers do business. A year ago, carriers often signed year-plus contracts that locked in prices and business for Robinson. Today, Wiehoff said, intensifying shipper demand places 75 percent of his company’s business in short-term, higher-margin transactional or “spot” trucking markets, while just 25 percent is for longer-term contractual runs. Robinson isn’t complaining; the company built its business one load at a time, Wiehoff said, and “We ride with the market.” All this activity prompted Robinson to add 223 employees in the first quarter. The company also made two acquisitions – FoodSsource and Epic Roots – as part of its declared intention to bulk up its sourcing business. Expansion to China, started in June 2004, and higher international shipping volumes, boosted Robinson’s gross air and ocean profits 52.8 percent and 30.6 percent, respectively. Executives said the company will continue pushing aggressively into international markets, and is seeking acquisitions especially in freight forwarding as a platform for longer-term growth. Robinson Buys, Builds Profits [by William Hoffman, Traffic World, February 21, 2005]
Logistics and trucking specialist adds sourcing, boasts banner growth, earnings in 2004. C.H. Robinson Worldwide pushed deeper into third-party logistics sourcing with its acquisition this week of three produce sourcing and marketing companies with combined annual gross revenues of $270 million. Minneapolis-based C.H. Robinson purchased operations and certain assets of Monterrey, Calif.-based FoodSource Inc., FoodSource Procurement and Epic Roots. Terms of the deal were not announced, though Bear Stearns estimated its total value at $62 million to $63 million in cash, stock and a potential earn-out.
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It came shortly after the logistics and trucking brokerage giant reported a 39 percent jump in net profit in the fourth quarter, to $38.5 million, capping a banner year in which gross revenue jumped 20 percent over 2003 to $4.3 billion. The growth included a 38 percent expansion in trucking gross profits – or revenue minus direct transportation costs – in the fourth quarter. For all of 2004, C.H. Robinson reported a $137.3 million net profit out of the $661 million in gross profits, a sharp improvement in margins and yield that showed the company gained from high demand in a tight capacity market. The new acquisitions fit C.H. Robinson’s higher-value-added sourcing category, where the company hopes to leverage its technology, truck network and scale to create revenue, procurement and cost synergies, said Jon Langenfeld of the Robert W. Baird & Co. investment firm. “The acquisitions into the smallest, slowest growing and least discussed CHRW segment may catch investors by surprise (particularly when CHRW’s acquisitions have been transportation related), but the deals appear to be a good strategic fit,” he wrote in a report on the purchases. Although sourcing was a foundation business for C.H. Robinson when the company was founded, it accounted for just 7 percent of the company’s 2004 gross profit. But the latest acquisitions fit into a higher yield value-added sourcing category – including branding, packaging and replenishment management – which Baird estimated has been growing at double digits. By contract, C.H. Robinson’s lower-value-added transactional operations, which account for roughly 60 percent of existing business, has been contracting. More importantly, said Matthew S. Brooklier of the Bear Stearns equity firm, “We believe there are ample opportunities (for C.H. Robinson) to gradually cross sell transportation services to underlying sourcing customers.” The acquisitions were all related to FoodSource, both a customer and competitor of C.H. Robinson. It provides procurement and distribution services in the retail, organic and food service sectors. The company offers contract buying programs and field-to-store shelf services, as well as private-label programs for conventional and organic produce. Other services include warehouse training programs, quality assurance inspectors, transportation management and educational programs. FoodSource has about 260 customers, including retail and specialty grocery chains and food service distributors. C.H. Robinson Acquires Produce Sourcing & Marketing Companies MINNEAPOLIS--(BUSINESS WIRE)--Feb. 14, 2005--C.H. Robinson Worldwide, Inc. ("C.H. Robinson") (Nasdaq:CHRW) announced today that it has acquired the operations and certain assets of three produce sourcing and marketing companies, FoodSource, Inc. and FoodSource Procurement, LLC ("FoodSource entities") and Epic Roots, Inc. ("Epic Roots"). The three companies combined had gross revenues of approximately $270 million in 2004. The FoodSource entities, based in Monterey, California, provide a variety of produce sourcing and distribution services including produce procurement, contract management, private label brand management, new item development, merchandising, packaging and transportation of produce. The FoodSource entities have approximately 260 customers, including large retail grocery chains, retail grocery wholesalers, mid-range supermarkets, specialty food chains and foodservice distributors. Terms of the acquisition were not disclosed. The FoodSource entities were established in 1998 by Tom Minnich and Ray Griffin. Minnich, 46, served as the chairman and chief executive officer of the FoodSource entities and will continue with C.H Robinson. The FoodSource entities have 52 employees, all of whom are expected to be offered employment with C.H. Robinson. Epic Roots was established in 1997 by Todd Koons. Based in Monterey, California, Epic Roots provides produce sales and product development services and is a key partner of FoodSource. Koons, 45, will continue with C.H. Robinson following the acquisition. Terms of the acquisition were not disclosed. "FoodSource and Epic Roots will be a great fit for our expansion plans," said Jim Lemke, C.H. Robinson vice president of produce. "They bring management depth, skilled employees, operational excellence, and supply chain management knowledge, with a proven track record of strong growth. We're excited about the potential and the opportunities that FoodSource and Epic Roots will bring to Robinson." Minnich added, "We have experienced solid growth by investing in great people and by providing unmatched levels of service to our clients. To continue this level of growth, we need to leverage our core competencies with information and technology resources that, at our current size, we would be hard-pressed to acquire. We're pleased to be joining Robinson and believe this is a great match of complementary resources and market segments."
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Company Name Caterpillar Logistics Services, Inc. Address: 500 North Morton Avenue, Morton, IL 61550 USA Phone Number: 309-266-3591 Email Address:
[email protected] Fax Number: 309-266-4420 Website Address: www.catlogistics.com
Subsidiaries or Related Companies Asset Focus: N
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Caterpillar Inc. Int'l Manufacturing (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1987
OVERALL CAPABILITY
Overall Capability of Provider: Very good warehouse-based 3PL.
KEY PERSONNEL
Mary Bell Michael Schmidt Steve Larson Chairman & President Dir. Marketing Pres. Americas Bob Sweikert Dave Hoffman CFO EAME/UK
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 2,140 1,540 * 11,680 65+ 5-10 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol CAT Exchange: NYSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 105 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 22 (Million) 15
Asset Ownership v.s. Leased: Transportation Equipment: na Warehouses/DC's: About 50/50
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Aircraft parts Industrial Automotive Military, Government Technology
(For functional specializations, see "Customers" section.)
Computers, Electronics Consumer Goods Telecommunications Heavy Equipment
INFORMATION SYSTEMS
Overall Information Systems Rating: E (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): CAT TIS (proprietary), i2 Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition i2 CLSS, SAP, Facility Logistics, ProAct i2 SCS, Tmod, LogicTools CAT TIS SAP, CLSS, ProAct EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials Other Services:
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: As required by client
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
AGCO American Tool Co. BMW Bombardier Caterpillar Inc. CNH Corp. DaimlerChrysler Delphi Donaldson Company Eastman Kodak Ericsson Fisher Controls Harley-Davidson Hewlett Packard
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Cat Logistics Location
Europe U.S. Australia, England, Italy, France, Sp U.S., Europe Global U.S. Global U.S., Europe U.S. Europe Europe U.S. Europe Europe
Industry
Industrial Industrial Automotive Aircraft parts Heavy Equipment Heavy Equipment Automotive Automotive Industrial Consumer Goods Telecommunications Computers, Electronics Consumer Goods Computers, Electronics
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa
Egypt South Africa United Arab Emirates
Countries served through owned offices or agents Australia / Pac.Isles
Australia
Cat Logistics North America
Canada United States
Asia
China India Japan Singapore South Korea
Europe
Austria Belgium France Germany Italy Netherlands Poland Portugal Spain Sweden United Kingdom
South/Latin America
Venezuela Mexico Brazil
EDITOR'S COMMENTS
Caterpillar Logistics has heavy U.S. and European operations with a growing presence in South America and Asia, distributing to more than 160 countries from over 50 facilities. Caterpillar Logistics’ scope reflects its parent’s global reach and dealer network. Caterpillar Logistics’ business is split equally between North America and the rest of the world. It continues to expand its automotive logistics business in Europe and the U.S. Caterpillar Logistics is a 3PL which has completely integrated warehousing and manufacturing supply chain software. Visibility in its integrated system CLSS is very good. Demand and supply forecasting and material planning is based on proprietary probability models. Forecasting for low turnover items has controlled standard operating procedures. Caterpillar’s transportation department was merged into Caterpillar Logistics in 2001, bringing its transportation management capability. Caterpillar Logistics focuses on customers with high-value durable goods. Caterpillar Logistics uses a combination of brokers and forwarders for selected customs functions. A major initiative involves automotive logistics for China. Provider's Strengths Distribution center management, IT and parent relationship. Provider's Weaknesses
CASES & NEWS
Site Visit Caterpillar Logistics Plans for Comprehensive Mainland China Operations Shanghai, China July 19, 2005 In a recent visit to Shanghai, China we had the opportunity to spend some time with David Brady, Caterpillar Logistics Services CEO & President for Asian Pacific operations. Brady who was integral in setting up Cat Logistics joint venture with Lei Shing Hong Limited in 2003, detailed his vision for Cat Logistics mainland China operations. According to Brady, Cat Logistics has taken a calculated approach to developing its mainland China operations involving intense marketing and operations planning. On August 21st of 2005 Cat Logistics will be opening phase I of its warehousing and distribution operations in Lingang New City, Shanghai, China. The initial facility will be 236,808 square feet (22,000 m2) located in the new ProLogis Park Lingang. Initial Cat Logistics operations will include service parts distribution for Caterpillar. The Park will act as Cat Logistics China Hub for import/export activities and will also perform multiple value-added services including: painting, kitting, remanufacturing and subassembly. ProLogis Park Lingang is being developed through a joint venture between Lingang Group and ProLogis. Phase I of will consist of eight facilities totaling nearly 1.1 million square feet (98,172 m2). The Park has the potential to support 10-15 million square feet (900,000-1.4 million m2) of distribution space. The Shanghai government is planning to spend approximately $12 billion to develop Lingang’s Yangshan deep ocean port into the largest port in the world with over 50 berths and an annual capacity of 25 million TEUs. By comparison, the largest volume port in the world today is Hong Kong with an annual capacity of 20.5 million TEUs. ProLogis Park Lingang will be located adjacent to the Lingang Expressway, which leads from Yangshan Port to Shanghai's central business district and merges with major roads to the rest of China. Additionally, the Park will have a new rail terminal with intermodal capabilities. As part of Cat Logistics strategy, Brady has developed a logistics distribution plan that is not completely reliant upon any one transportation mode. Cat Logistics is looking to contractually build a mainland Chinese transportation and warehousing network incorporating rail and truck transportation from coastal areas west into Quinghai province and from Guangdong province north to Shanxi province. Cat Logistics strategy is to not only focus on traditional export/import business, but also to build a network that can support the growing domestic Chinese market for goods. Brady also sees reverse logistics and recycling as strong potential growth areas. According to Brady, “Recycling is a huge reverse logistics problem. The Chinese government is asking how do we recycle engines, cars, plastics, phones and computer products and Cat Logistics is working to help provide them with a solid logistics solution.” Another challenge for China revolves around “Low cost country sourcing”, according to Brady. Quality control on specialized manufactured products is an issue. Total transportation costs need to come down through increased supply chain network efficiencies. Through its growth strategy, Brady anticipates Cat Logistics mainland China operations to develop at an annual growth rate over 100%. Currently Asian Pacific operations account for approximately 10% of Cat Logistics total revenues; Brady estimates that they will garner 1/3 of
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its total revenues by 2010. Site Visit Morton, Illinois January 11, 2005 Key Personnel: Mary Bell - Chairman & President Michael Schmidt - Global Marketing Director Mark Hynes - Vice President of Manufacturing Logistics & Transportation Krish Srinivasan - Sr. Manager of Client Inventory Management Services Craig Brabec - Manager of IT Strategy & Global Costing Bill Meek - Competitive Analysis Coordinator Chad McClaskey - Marketing/Media Relations Manager Caterpillar Logistics Services, Inc. (Cat Logistics) has leveraged its relationship with parent company Caterpillar Inc. in developing true global supply chain management capabilities. Cat Logistics has grown to be the sixth largest North American-based 3PL with $1.1 billion in net revenues in 2003. It has been attracting significant external business; Caterpillar, Inc. now accounts for approximately 50% of the Cat Logistics revenues. Plans are to grow external business at a compound annual growth rate of 26% over the next five years. Global logistics operations employ over 9,200 people; the majority work at Cat Logistics 100 distribution centers. This supply chain network has over 20 million square feet of capacity strategically located in 25 countries. Cat Logistics fills more than 180 million order lines annually and ships over 16 billion pounds of commodities each year. Cat Logistics annual purchased transportation bill exceeds $1 billion. According to Chairman and President Mary Bell, Cat Logistics’ main growth over the next five years will come from expansion in the Asian Pacific, European, North and South American, Australian, and Russian markets. It is currently developing a new logistics operation in Lingang Park (Shanghai), China. "We grow by applying combinations of value-added services in the development of a strategic partnership with customers". Like many large 3PLs, Mary sees finding the right qualified people to fuel its growth as Cat Logistics biggest challenge. Cat Logistics targets global Fortune 500 companies in five key industry verticals: Automotive, Consumer Durables, Industrial, High Tech., and Aerospace & Defense. Customers include: DaimlerChrysler, Ford, GM, Nissan, CNH, Donaldson, Kodak, Toshiba, Bombardier, and Honeywell. Cat uses a hierarchical framework in managing its supply chain services offering. At the top level, Cat can help customers in developing an overall supply chain strategy. It can then perform supply chain design consulting and modeling and systems and technology support services. The service structure ends with tactical supply chain execution services such as: order management, materials management, transportation management, distribution, and reverse logistics. Cat Logistics has become a leader in inventory and integrated supply chain management. To support its global operations, Cat Logistics is developing an integrated supply chain systems "backbone". In a joint venture with Ford and software giant SAP, Ford and Cat's intellectual property is being used to greatly enhance SAP's warehouse management and inventory management capabilities. The co-developed system will be released as SAP SPM (Service Parts Management) version 5.0 in Q4 of 2005. Cat Logistics will use SPM for forecasting, demand planning, inventory management, and warehouse management. It will be integrated with i2's Transportation Manager for daily transportation planning and management. Unlike many 3PLs who are using three or more systems for a core supply chain systems backbone, Cat will be able to support its medium to large 3PL customers with two tightly integrated systems. With top I.T., people, and inventory and supply chain management processes, we anticipate that Cat Logistics will meet its significant revenue targets and continue as a true "Tier One" global 3PL. Cat Logistics’ Morton, IL distribution center is a 2.2 million square foot dedicated service parts facility servicing Caterpillar's dealer and regional D.C. network. Approximately 375,000 different parts are warehoused having a value of just under $2 billion. With a warehouse staff of 900, approximately 35,000 order lines are filled each day, inbound receipts of 3,000 totes and 2,300 containers are processed, and a host of value added activities such as parts coating and painting, kitting, and pick/pack are performed. Much of the picking is performed by automated picking machines. The facility utilizes approximately 26 miles of mechanized conveyer systems for efficiently moving inbound and outbound units. A consolidated packing area of 60 individual lines is used to pack out orders for shipping. Caterpillar's dealers have complete inventory visibility and can order parts using Cat's ANTARES parts ordering/processing system. Cat Logistics has saved Caterpillar millions of dollars by reducing its on hand inventory from 10.4 months in 1989 to 5.5 months today. Even so, Cat Logistics is currently realizing a system order fill rate of 99.7%. Site Vsit March 14, 2003 Caterpillar Logistics Services (Cat Logistics) is a high quality 3PL with built in advantages that should make it one of the major global logistics providers over the next five years. Only UPS has similar financial and structural advantages. Both Cat Logistics and UPS have very strong Fortune 100 parent companies with “can do” cultures, high quality operations, process controls and world class IT. Cat Logistics has the additional advantage of doing supply chain management in a way that is a core competency for its parent company. Cat Logistics’ core supply chain management tool is its parent company’s “Facility Logistics System” (FLS). This system allows for detailed knowledge about existing inventory and replenishment requirements. For years, it has allowed Caterpillar to find the best inventory solutions. The only shortcoming for Cat Logistics was that it did not have the same level of quality control outside of facilities. Cat Logistics is a 6 Sigma operation with Euclidean analysis for the best warehousing designs. Because of its Fortune 100 contacts, it gets “C” level sales opportunities other 3PLs could only dream about. But it lacked “world class,” outside-of-the-box transportation system controls. Not surprising, Cat Logistics has tapped into its resource rich stream to come up with a strong solution. The formula was simple. It had three parts: people, processes and new information technology merged together from Caterpillar’s corporate traffic department, parts and services, and Cat Logistics. The merger of these three operations is now complete. The new transportation management scheme has already saved Caterpillar over $50 million.
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Natal Garcia, the vice president in charge of transportation management, is quick to point out that over half of the savings are from process improvements. The right people are doing the right things. It helps that he has i2 and other state of the art software. Optimization does provide some important savings, but it is secondary to the power of Caterpillar’s standardized process, heavy approach and culture. Garcia and his staff are now ready to market their transportation management product as part of Cat Logistics’ global supply chain solution. Steve Wunning, President of Cat Logistics, brought Garcia in to manage the new TMC two years ago. Wunning has also brought in a new president for the Client Services Division. Ron Kruse is a Caterpillar veteran with experience in Singapore, Europe and other locations. Kruse, a very personable guy, is responsible for Daimler-Chrysler and other major accounts. Surrounding the officer core are a host of directors and managers with good educational and experience backgrounds. Two of the strong middle-managers are Ray Schnabel in Global Planning and Bill Gordon in Transportation Solutions. Wunning and his staff have also taken on a major supply parts software initiative. Cat Logistics is in a joint venture with Ford and SAP to develop Next Gen. Next Gen is designed to be a global, best in class, service parts supply chain management tool. About 80% of Caterpillar and Ford processes are the same and the payoff can be huge for both companies. Cat Logistics clients will get significant benefits. Major features will include: - Global company support - Modular, scalable, flexible and secure design - Supply chain planning and execution - High volume capability - Best in class WMS capabilities - Real time visibility - Third-party logistics flexibility Cat Logistics is on the threshold. It now has all the pieces and a large base from which to expand rapidly. A significant part of this expansion could be in where Caterpillar is well positioned to move forward. If that isn’t enough, Caterpillar had $673 million in free cash flow for FY 2002. Like UPS, it has a mountain of resources to draw on. Cat Logistics To Provide Integrated Logistics Solution to Mitsubishi Heavy Industries and Shin Caterpillar Mitsubishi Peoria, Il – Caterpillar Logistics Services, Inc. (Cat Logistics), a wholly owned subsidiary of Caterpillar Inc., today announced an agreement with Mitsubishi Heavy Industries (MHI) and Shin Caterpillar Mitsubishi (SCM) to provide an integrated logistics solution in support of their respective service parts operations in Japan. Cat Logistics will provide warehouse operations, limited inventory management, transportation management, packaging, and information technology, resulting in improved service to MHI and SCM customers along with improved distribution efficiency. Cat Logistics will manage the construction of a leased state-of-the-art 50,000 square meter logistics facility to be located in Sagamihara, Japan, near Tokyo, with an opening scheduled for February 2008. Approximately 250 Cat Logistics professionals will provide logistics services, enabling MHI and SCM to better serve and provide greater value to their customers. This agreement is the result of an extensive 18-month study conducted by Cat Logistics in order to provide detailed recommendations to improve MHI’s and CSM’s Japan-based supply chains to world-class levels. MHI’s diverse lineup of products includes industrial and general machinery, while SCM manufactures and sells construction equipment such as hydraulic excavators, track-type tractors, wheel loaders and paving equipment. “This agreement is the result of a strong collaboration between MHI, SCM and Cat Logistics to determine the logistics solution required to provide the greatest benefit to MHI and SCM customers,” said May Bell, chairman & president, Caterpillar Logistics Services, Inc. “This type of partnership approach is what differentiates Cat Logistics within the marketplace and has delivered proven results.” Cat Logistics wins contract extension with AGCO [Transport Intelligence, December 22, 2005]
AGCO Corporation, a global manufacturer and distributor of agricultural equipment and related replacement parts, and Caterpillar Logistics Services have extended their European contract until 2012. Cat will provide logistics services through a 300,000 square feet facility in Desford. The facility will undergo a major warehouse rearrangement in 2006, allowing for AGCO’s projected growth throughout the latter half of this decade. Along with improved space utilization, the redesigned facility will also deliver improved productivities and operational efficiencies. Cat Logistics has provided logistics support for AGCO aftermarket parts since 1992, through warehousing, packaging, kitting and distribution for the UK, Ireland and international markets. General Motors Europe and Caterpillar Logistics Services Announce Joint Venture [Logistics Online, October 27, 2005]
General Motors Europe (GME) and Caterpillar Logistics Services, Inc. (Cat Logistics), a wholly owned subsidiary of Caterpillar Inc., have reached a ten-year agreement to form Caterpillar Logistics Supply Chain Services GmbH, a joint venture company. This project is part of GME’s comprehensive restructuring program announced last fall. Serving as a third party logistics provider, the joint venture will implement Cat Logistics’ industry best practices to deliver aftermarket warehouse productivity increases, ultimately having a positive impact on service levels and the financial performance of GME’s supply chain. The joint venture will be responsible for operations at GME’s parts and accessories distribution facilities in Bochum and Russelsheim, Germany, and Rome, Italy. By December 1, approximately 100 employees from GME’s Italian warehouse will transition to the joint venture. By February 1, 2006, another 1,100 employees from GME’s German facilities will follow. “We are confident that teaming with Cat Logistics will take our European logistics performance to a new level, providing an even more reliable service to our retailers and customers. The joint venture will make a significant contribution toward improving our overall competitiveness in Europe,” said Jonathan Browning, Vice President Sales, Marketing and Aftersales of General Motors Europe. “Cat Logistics has long been recognized for its ability to provide clients with service parts operational excellence, and I am delighted that we have the opportunity to expand our relationship with General Motors Europe through the formation of this joint venture,” said Dave Hoffman, President of Caterpillar Logistics for Europe, Africa and the Middle East. The 150,000 square meter Bochum, Germany facility stores over 100,000 parts and components, and will have responsibility for replenishing 11 European Parts Distribution Centers as well as providing parts to non-European customers. Around 2,500 German, Swiss and Austrian customers will be served from the 120,000 m2 facility at Russelsheim, Germany. The 15,000 m2 parts distribution center in Rome, Italy will
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continue to serve the 400 Italian and Greek customers. Logistics Inside China: The Next Big Supply Chain Challenge Challenge September 2005, pg. 28] [by Thomas Foster, Global Logistics & Supply Chain Strategies,
The opportunities and challenges for serving China’s domestic market are enormous. The secrets to success are a reliable supply chain with trusted partners and reliable 3PLs that can navigate China’s immature infrastructure and complex regulatory environment. Strategic Growth There are other successful models for operating in China. For example, Caterpillar, the $30bn manufacturer of construction and mining equipment, started selling its products in China in 1975. In the 1980s, it began licensing the manufacture of certain Caterpillar products to Chinese companies. Caterpillar’s expansion in China accelerated in the early 1990s with a more aggressive local production strategy. Today, Caterpillar operates 10 facilities – both joint venture and wholly owned businesses – and employs approximately 2,000 people. Caterpillar sells its products through a network of five independent Caterpillar dealers in China. It’s most recent investment is a minority interest in Shandong SEM Machinery Co., one of China’s key wheel loader manufacturers. Caterpillar has the option to purchase the remaining equity after two years. “China is a very strategic market for Caterpillar because of the huge infrastructure projects throughout the country,” says Bill Gordon, director of supply chain strategy design and transportation for Caterpillar Logistics Services based in Shanghai. “Just as Caterpillar has the right products to support these rebuilding projects, Cat Logistics provides the right services to support the products that our parent company is selling in China.” Caterpillar’s service parts business has always been supported from Cat Logistics’ DC in Singapore, but that is about to change. The 3PL is building a 20,000 square-meter DC outside Shanghai that is to be the base for supporting the service parts business of Caterpillar as well as other Cat Logistics customers in China. This new DC will be in a logistics park being developed by the Shanghai Lingang Economic Development Company (Lingang Group). It will be the world’s largest industrial park. Caterpillar will also locate its remanufacturing services center in the Lingang park. Shanghai is the ideal DC location for Caterpillar Logistics, Gordon says. The nearby port allows easy importing of parts from the U.S., Japan and Europe. The industrial park also represents a potential source of 3PL business when Cat Logistics expands operations beyond the parent company. “We selected this site using supply chain network design tools to identify the location and the optimal distribution network,” he says, adding that the tools Cat Logistics used are a combination of i2 Technologies software and Caterpillar proprietary tools. “We will be using these same logistics network planning tools for new clients.” The Lingang location is a so-called bonded logistics park, which provides many of the same benefits of a free trade zone, but it provides more flexibility because the entire facility does not have to be in bond. “You can have bonded and non-bonded operations under the same roof,” says Gordon, adding that multiple customers can operate out of the same bonded facility as well, which is important for a 3PL. “A bonded facility requires you to work very closely with customs, but the flexibility you gain is worth the effort.” Caterpillar Logistics was first established in China as a joint venture with one of its own dealers that had been in the Shanghai area. “We have been able to leverage the knowledge that our dealer had developed over its years in China,” says Gordon. “It has given us a head start in understanding the challenges they have had to deal with. The joint venture has greatly shortened our learning curve.” Cat Logistics has not served other customers in China, but it is preparing to work with many of the global companies that it serves elsewhere, including automotive OEMs, industrial equipment manufacturers and telecommunications hardware customers. “We are strong in service parts and manufacturing logistics, where we handle all aspects of inbound components right to the production line,” says Gordon. Transportation management is likely to become a big part of the 3PL’s business, he says. Although most economic activity in China has been concentrated on the Eastern seaboard, especially around Shanghai and south to Shenzhen and Hong Kong, there is a major government initiative to move more manufacturing into the hinterland where transportation services are still quite immature. Besides basic transportation infrastructure problems in many parts of the country, there are regulatory issues involved with trucking across provinces and the need to find reliable carriers. “The transportation modeling is especially important because of the constraints that exist with the current infrastructure,” says Gordon. “ With the i2 tools we use and the experience we are developing, we will be able to provide our clients with the best transportation management services among the 3PLs operating over here.”
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Company Name Centro De Almacenes Congelados C.A. (Cealco) Address: Av. Blandin, Centro Commerical Mata de Coco - Edif., Sur - Piso 2, Ofic Este, La Castellana, Caracas 1 Phone Number: 244 395 4113 Email Address:
[email protected] Fax Number: 244 395 4462 Website Address: www.cealcove.com
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Inversiones Tacoa S.A. S. Amer. (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1976
OVERALL CAPABILITY
Overall Capability of Provider: Capable, small Venezualan warehousing and distribution company.
KEY PERSONNEL
Asdrubal Hernandez Nelson Acosta Leopoldo Vicente General Manager Logistics Services Manager
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 12 12 * 250 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 4 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Owned 1.8 (Million) 8
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Agriculture Consumer Goods Food, Groceries
(For functional specializations, see "Customers" section.)
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Foursite EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Foursite
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Alimentos Surgela Alimentos Texas Frito Lay General Mills Makro Monsanto Plumrose Proagro Unilever Wendy's
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Cealco Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Food, Groceries Food, Groceries Food, Groceries Food, Groceries Food, Groceries Agriculture Retailing Retailing Consumer Goods Food, Groceries
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
Cealco South/Latin America
EDITOR'S COMMENTS
Cealco is a distribution 3PL in a country (Venezuela) with serious cultural and economic problems. Provider's Strengths Capable regional 3PL and Venezuelan solution.. Provider's Weaknesses Limited to Venezuela.
CASES & NEWS
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Company Name Christian Salvesen plc Address: 500 Pavilion Drive, Northampton NN4 7YJ United Kingdom Phone Number: 44 1604 662 600 Email Address:
[email protected] Fax Number: 44 604 662 605 Website Address: www.salvesen.com
Subsidiaries or Related Companies Gerposa Asset Focus: A Darfeuille (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1995 Market Area: Founding Business: Int'l
OVERALL CAPABILITY
Overall Capability of Provider: Good integrated service provider with food chain and automotive emphasis.
KEY PERSONNEL
Stewart Oades Julian Steadman CEO CFO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 758 758 * 12,622 >50 3 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol London Exchange: SVC
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 5,000 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 5,000 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 6,000 Total Warehouses & Distribution Centers: Total Warehouses/DC's: Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: 6.5 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Chemicals Oil & Energy
(For functional specializations, see "Customers" section.)
Paper Technology
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Sharpnet, Stocknet Shart Network, ULTIMA
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Agfa-Gevaert Arjomari Dow Chemical Dunlop Exxon Ford Motor Michelin Porsche Texaco
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Christian Salvesen Location
Europe Europe Europe Europe Europe Europe Europe Europe Europe
Industry
Technology Paper Chemicals Automotive Oil & Energy Automotive Automotive Automotive Oil & Energy
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Benelux France Ireland Portugal Spain United Kingdom
Christian Salvesen North America South/Latin America
EDITOR'S COMMENTS
Christian Salvesen is a major European contract logistics and distribution specialist. Emphasis is on integrated solutions. CS handles frozen and perishables in its food services/retail operations. CS has a joint venture, Holistice, with APL. This joint venture allows CS to offer global logistics. 69% of its business is covered by contracts. Food and retail account for 44% of revenue; automotive is 18%. Provider's Strengths Food Provider's Weaknesses
CASES & NEWS
Christian Salvesen Wins Inter Link Foods Contract Christian Salvesen, the logistics specialist, has recently won the contract to provide a complete supply chain solution for Inter Link Foods. Inter Link, which is based in Blackburn, make a variety of cakes for the retail own label sector and also produce the branded product ‘Soreen’ . With a turnover in excess of £100 million, they are also the UK’s largest producer of mince pies, fairy cakes and decorated buns and have 12 factories in the UK, as well as a facility in Poland. Under the 5 year contract, which is worth between £40 million to £45 million, Christian Salvesen will be delivering approximately 4,500 pallets of finished products from Inter Link to the retail distribution centres of major supermarkets and other customers, 7 days a week. In addition, Salvesen will also be transporting 1000 pallets of raw materials directly to some of the Inter Link Bakeries. Speaking about the award of the contract, Paul Mohan, Managing Director of Christian Salvesen’s Temperature Controlled Business Unit said: “We are delighted to have been awarded the Inter Link Foods contract. They are a highly successful and professional organisation and I am confident that our solution will help them to achieve their business objectives. “Essentially, we are taking the existing supply chain operation and moving it to a centralised platform using Salvesen’s leading in-house IT capability. This system will provide detailed cost and management control down to case level at the bakeries. This method of working will provide an excellent platform for Inter Link to grow and take on new customers in the future.” One of the key factors that helped to win the contract was the fact that Christian Salvesen’s IT systems were able to include processes and procedures that encompassed Vendor Managed Inventory (VMI). Through the Salvesen in-house developed Warehouse Management System, every aspect of sales, stock control, forecasting and production can be managed to ensure that supply is constantly matched to demand. Alwin Thompson, the Executive Chairman of Inter Link Foods said: “We chose Christian Salvesen because of their high reputation within our industry for professionalism, the quality of the team that we met and also the innovative approach that they adopted in their proposal to meet our requirements. “We are looking forward to developing a long and mutually beneficial relationship with Christian Salvesen, that will enable us to significantly improve the quality of service that we provide to our customers.” Christian Salvesen Extends Weight Watcher Service Christian Salvesen is celebrating extending its partnership with leading weight management organisation - Weight Watchers. In addition to operating Weight Watchers’ 17,000 sq ft ambient warehouse (a contract which commenced in June 2005), Christian Salvesen, will now also be managing their home delivery transport operations, delivering in excess of 750,000 parcels per annum of products direct to Leaders homes throughout the UK. With over 6500 meetings taking place every day at various times, these materials are designed to aid the successful weight loss of Weight Watchers members and therefore a reliable delivery service is essential. Mark Catley, general manager for Christian Salvesen, said: “Salvesen has proved its ability to bring improved logistical management capability to Weight Watchers warehouse operations. As Weight Watchers’ logistics partner, we will now be working to improve the on-time delivery of products to leaders’ home addresses. Salvesen operates a wide range of logistics services throughout the UK and we are excited by this addition to our home delivery service offering”. Ged Mitchell, Supply Chain Manager, Weight Watchers UK Ltd added: “Weight Watchers Leaders are the heart of our business and we have to ensure that they receive the products they need, intact and on time. Since June 2005, Christian Salvesen has demonstrated its ability through the management of our ambient warehouse and we are confident they will adopt the same successful approach to our transport operation.” Christian Salvesen Wins Vandemoortele Contract Vandemoortele (UK) Ltd, the Belgian based manufacturer of frozen bakery products has appointed market leading frozen logistics specialist - Christian Salvesen, to handle its frozen requirements in the UK. Christian Salvesen will manage the contract from its Nuneaton Distribution Centre which will be operated on a shared user basis. The distribution centre will manage the daily collections from Vandemoortele’s Worcester factory and receive product from the Vandemoortele continental manufacturing operations. Christian Salvesen will take full responsibility for the warehousing and distribution services throughout the UK.
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Around 150 different product lines will be in stock at any one time, for distribution to the various outlets, which include the Retail, Wholesale and Foodservice sectors. Paul Mohan, the Director of Christian Salvesen’s Temperature Controlled Business Unit in the UK said: “We are delighted to have won this contract on the back of a very competitive tender process. Vandemoortele is the leader in its field and this contract will mean that it becomes an integral customer of the Nuneaton site achieving the benefits of shared user logistics.” On the continent Vandemoortele manufacture at various plants in Belgium and France. Their products include frozen puff and Danish pastries, doughnuts, continental breads and many other bakery offerings. The group employs over 3,200 people in 12 European countries and accounts for a turnover of 857 million Euros. Roy Watson, Supply Chain Manager of Vandemoortele UK added: “Christian Salvesen was chosen on the basis of its cost effectiveness, tracking and proof of delivery system. Location was also a key factor. Nuneaton is very convenient for our Worcester manufacturing base. We are looking forward to this partnership with them.” Paul Mohan believes that Vandemoortele will benefit from the quality of service that his team provides: “I am confident that through the transitional period and subsequent operation that the Nuneaton warehouse and transport teams will provide Vandemoortele with an excellent and sustainable service that will add value to their business.” Christian Salvesen Strengthens Partnerships With new Contracts Christian Salvesen has been appointed by Continental Tyre Group Limited to provide warehousing and distribution throughout the United Kingdom. From July this year, the European Logisitcs business will manage the tyre storage, handling and distribution of Continental Tyre Group Limited Brands. The contract was put out to tender last year, and nine companies took part in the process. Christian Salvesen was successful in securing a five year contract which will be fully operational by 1st July 2006. Christian Salvesen has also extended its logistics partnership with Goodyear Dunlop Tyres UK Limited. Christian Salvesen will take over the operation of the National Distribution Centre (NDC) at Tyrefort in Erdington, Birmingham, which has more than 500,000 sq. ft. of warehousing space and provides the capacity to store one million tyres. Operating 24 hours a day, the NDC incorporates 47 loading bays and has become established as the UK's leading tyre distribution centre. Christian Salvesen will move the Continental Tyre Group Limited's distribution from its current location in Rugby to the Tyrefort facility and will manage both contracts on a shared user basis. Steve Russell, strategic sales and marketing director at Christian Salvesen commented: "Our ability to identify how we would improve service levels at highly competitive prices was key to these contract awards. Christian Salvesen continues to develop its partnerships within the automotive industry working with both Goodyear Dunlop and Continental."
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Company Name Coimex Logística Integrada S.A. Address: Av. Pres. Juscelino Kubitschek, 1830, Sao Paulo, SP 04543-900 Brazil Phone Number: 550 11 4619 8800 Email Address:
[email protected] Fax Number: 550 11 4619 8810 Website Address: www.coimexlogistica.com.br
Subsidiaries or Related Companies Axis do Brazil Ltda. Asset Focus: N Cisa Trading Vitoriawagen many more (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Grupo Coimex Int'l Export/Import Year Started in Logistics: 2000
OVERALL CAPABILITY
Overall Capability of Provider: A capable, modern 3PL. Sister company is a major automobile importer and exporter.
KEY PERSONNEL
Waldir Barrella Ricardo M. Garvizu Flores Business Development Manager Logistic Manager Joao Cunha Cristiano Marcondes VP Finance IT Manager
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 6 2 * 50 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 1 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: na Warehouses/DC's: Mostly Leased 0.13 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Computers, Electronics
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary Proprietary Helas/Heyde
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Brazil Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Apple Computer DaimlerChrysler Ford Motor General Motors Globalstar do Brasil Hewlett Packard Officer Toyota Volkswagen
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Coimex Location
Brazil Brazil Brazil Brazil Brazil Brazil Brazil Brazil Brazil
Industry
Computers, Electronics Automotive Automotive Automotive Computers, Electronics Computers, Electronics Computers, Electronics Automotive Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
14th Edition
©Copyright 2006 Armstrong & Associates, Inc., Stoughton, WI 53589 USA
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Switzerland United Kingdom
Coimex North America
Canada United States
South/Latin America
Uruguay Mexico Brazil
EDITOR'S COMMENTS
Coimex Logistics is part of a major Brazilian company with modern logistics capabilities. (Check out the site visit below.) Provider's Strengths Modern 3PL with good Brazilian coverage. Provider's Weaknesses
CASES & NEWS
March 27, 2001 Site Visit Contact: Robert Caracik, Director Presidente Except for the language, walking into the operations of Coimex Logistica is like walking into a third party logistics operation in the United States. The office is modern with a computerized backbone to all its operations. Logistics specialists are organized by cells for individual accounts. Compensation for logistics specialists is partly determined by cell success. Awards for logistics excellence are proudly displayed. I could see the workings of this operation quickly and felt very much at home. Coimex is a very large, profitable Brazilian business that grew from coffee exporting origins. Its operations today emphasize bulk exports, petroleum logistics support, importation of manufactured goods, automotive logistics/transport and third party logistics. Automotive logistics and sales is based near Vitoria. This operation includes a huge facility for final prep of automobiles and an enormous parking lot. It serves as a reshipment point for the Coimex joint venture, Axis do Brazil. Coimex imports are 40% automotive with customers like GM, VW and Toyota. Other major emphases are in hi-tech (Hewlett Packard, Apple, Global Star) and retail goods. Coimex has 200 key customers. In Sao Paulo, Coimex has a modern 3PL warehouse (80,000 square feet) with 6,000 pallet positions. This paperless warehouse provides value added services and Internet inventory reporting. The WMS is Helis from the German company Heyde. (Lufthansa uses this software for its spare parts support operations). Fifteen hi-tech and telecom customers are serviced through this high security facility. The head of Coimex Logistica is Robert Caracik. Caracik received his basic training in the United States. He directed Ryder Logistics’ startup in Brazil. Caracik is a modern, aggressive manager. He runs a modern operation that could be located anywhere. [via website, 3/01] One of our specialties is to manage supplies, making information available to our client in real time. Thus, we count on very modern equipment, trained professionals, system of integrated information, structure of more than 750.000 square meters for common storage, customs and services for the adequacy of goods to the Brazilian market. Coimex Armazéns Gerais S.A is certified under the norms of ISO 9002 for all its storage processes and vehicle and cargo movement, counting on the support of PDI Comércio, Indústria e Serviços Ltda., which has the capacity to inspect up to 300 vehicles a day. The search for better solutions has driven Grupo Coimex to develop procedures perfectly tuned to each client's strategy. Through Coimex Logística Integrada S.A., an allied company, we provide all the necessary support to storage, consolidation and distribution of goods to the whole country making use of the most modern technology of system support and information technology resources
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©Copyright 2006 Armstrong & Associates, Inc., Stoughton, WI 53589 USA
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Company Name China Resources Company (CRC Logistics) Address: Yuen Fat Adminstration Bldg, Yen Chow St. West, Kowloon Reclaimation, Hong Kong Phone Number: 852-2828-3668 Email Address:
[email protected] Fax Number: 852-2827-1670 Website Address: www.crclogistics.com
Subsidiaries or Related Companies Farenco Transportation A Yuen Fat Warehousing Shenzhen Farenco Sha Tin Cold Storage
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: China Resources (Holding) Co. Ltd. Asset Focus: Hong Kong Transportation/shipping (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1949
OVERALL CAPABILITY
Overall Capability of Provider: A large, multi-faceted logistical provider with Sinotrans roots.
KEY PERSONNEL
Lau Pak Shing Tommy Chan Brace Lin Dir. GM Dir. Bus. Affairs Asst. GM Stephan Chan Lau Pak Shing Controller CIO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 220 20 * 1,300 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 23 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 10 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 2 (Million) 20
Asset Ownership v.s. Leased: Transportation Equipment: Owned Warehouses/DC's: Owned
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 500000 Total Annual Airfreight Tonnes:
MARKETS
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): MK Logistics Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition MK Logistics EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Logistics Warehouse Mgmt. Sys.
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Hong Kong Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
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COUNTRIES with OFFICES
Africa Asia
China Hong Kong
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
CRC South/Latin America
EDITOR'S COMMENTS
The multiple operations of the parent company have revenues of $13 billion per year. About 500,000 TEUs per year are handled. Value-added services are extensive in Yuen Fat operations. Provider's Strengths Broad, approved Peoples Republic of China operations. Provider's Weaknesses
CASES & NEWS
Since her founding in 1949, China Resources Logistics Co., Ltd (CRCLogistics) has experienced numerous events that are unable to be fully presented here. The following are some milestones during her half-century developing stages: May, 2002, ISO9001:2000 was accredited to Yuen Fat Wharf & Godown Co., Ltd; April, 2002, CRC Express Web-based IT system (www.crcexpress.com) newly developed; March, 2002, CRC Logistics implemented a world-class IT system- MK Logistics; July, 2001, The first standard service station of CRC Express was set up; July, 2001, CRC Logistics (Shanghai) Co., Ltd was established; July, 2001, Zhongshan / Zhuhai 2 Branches of Farenco Freight Services Ltd. in PRD were set up after approval by MOFTEC and MOC; June, 2001, General Electric(GE) signed a contact with CRC Logistics for 7-location SCM one-stop logistics package services, A GE project team was organized; June, 2001, Dongguan Branch of Farenco Freight Services Ltd. in South China was set up after approval by MOFTEC and MOC; January 18, 2001, ISO9002 was accredited to Farenco Freight Services Co., Ltd Jiangsu Branch; January 16, 2001, DHL signed a contract to jointly operate the warehouse with Yuen Fat; January 18, 2001, ISO9002 was accredited to Farenco Freight Services Co., Ltd Jiangsu Branch; January 16, 2001, DHL signed a contract to jointly operate the warehouse with Yuen Fat; January 01, 2001, China Resources Logistics Co., Ltd was renamed from Farenco (Holding) Co., Ltd; January 01,2001, China Resources Express Co., Ltd was renamed from Farenco Express Co., Ltd; October, 2000, Dalian / Qingdao / Weihai / Yantai 4 Branches of Farenco Freight Service in North China were set up after approval by MOFTEC and MOC; August,2000, CRCExpress signed courier service cooperation contract with DHL in Hong Kong; February,2000, Farenco Express Co., Ltd was set up in Hong Kong; July 21,1999, ISO9002 was accredited to Yuen Fat Wharf & Godown Co., Ltd; August,1998, Jiangsu / Shanghai 2 Branches of Farenco Freight Services were set up after approval by MOFTEC & MOC; 1997, Set up Guangzhou / Haikou / Shenzhen / Xiamen 4 Branches of Farenco Freight Services after approval by MOFTEC & MOC; August 19,1996, Farenco (Holding) Co.,Ltd was set up by consolidating all Hong Kong subsidiaries of Far East Enterprising Co., (H.K.) Ltd and China Resources Transportation & Godown Co., Ltd; June,1996, Tianjin Branch of Farenco Freight Services was set up after approval by MOFTEC & MOC;
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1996, Stared to provide Express Courier Service to clients ex. Hong Kong and Mainland; November 1995, Huarun Dadong Dockyard Co., Ltd was established as joint venture with Shanghai Hudong Shipbuilding Co., Ltd with total investment RMB200 Million; 1990's, Purchased and owned hundreds thousands tons of bulk-cargo vessels; 1990's,set up several joint ventures in Hong Kong and Mainland; September,1987, Yuen Fat Wharf and warehouse was constructed ready for the use of transit cargo ex. Mainland; Since 1985, Purchased and traded 170 barges and feeders as representatives of domestic shipping companies; 1985, became a member of China Resources Group; Prior to 1985, as Hong Kong subsidiary and general agent of Sinotrans; December 07,1984, Yuen Fat Wharf & Godown Co, Ltd was set up; February 1984, China Resources Transportation & Godown Co., Ltd was set up to intensify warehousing service; 1970's-90's, As general agent of domestic shipping companies to issue "Farenco Ocean Rate Paper" by negotiating rates with foreign ocean carriers; 1977, The First Company to introduce rail-sea intermodal transportation for transit cargo ex. China; 1972, The First Shipping Company of China was ever registered and approved by FMC of USA; 1963-1987, Exclusive general agent of Sinotrans in Hong Kong with handling 2million freight tons of transit cargo via Hong Kong; 1963-1964, The year of water fierce deficiency in Hong Kong (water supply 4 hours per day), as exclusive shipping agent of 34 feeders to transport water from Guangdong Province; 1957-1971, Totally owned 27 ocean vessels with 300,000 DWT,and handed over these vessels to join COSCO in 1971; 1950's, Rented 180 foreign vessels reaching 1.4million DWT; 1949, Far East Enterprising Co.,(H.K.) Ltd was established, that was initial company of current CRCLogistics.
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Company Name Crowley Logistics, Inc. Address: 9487 Regency Square Blvd. N., Jacksonville, FL 32225 USA Phone Number: 800-969-4261 Email Address:
[email protected] Fax Number: 904-805-1641 Website Address: www.crowleylogistics.com
Subsidiaries or Related Companies Crowley Liner Services N, A Crowley Marine Services
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Crowley Maritime Corporation Asset Focus: Int'l (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1998
OVERALL CAPABILITY
Overall Capability of Provider: Capable forwarder; major Caribbean player.
KEY PERSONNEL
Rinus Schepen Miguel Artiga Tony Otero Sr. V.P. & G.M. VP Business Development Dir. Finance Tony Menendez Carlos Rice Dir. Bus. Dev./GM Apparel Tpn. GM/Speed Cargo
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 38 38 * 250 5 2 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 300 Total Reefers: Total Flatbeds: Total Tankers: Total Other: 20 Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 20 300 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 8 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 0.5 (Million) 0 12
Asset Ownership v.s. Leased: Transportation Equipment: Leased Warehouses/DC's: Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: >20000 Total Annual Airfreight Tonnes:
MARKETS
Apparel/Garments Automotive
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): G-Log-GC3, TMW Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Lawson, TMW G-Log-GC3 EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling G-Log-GC3
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Jacksonville Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
DeRoyal Industries Fruit of the Loom Gabriel Norton McNaughton Roka Apparel
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Crowley Logistics Location
USA Central America Asia/Africa/Europe Central America Central America/USA
Industry
Apparel/Garments Apparel/Garments Automotive Apparel/Garments Apparel/Garments
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
China
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
United States
Crowley Logistics South/Latin America
Guatemala Brazil Venezuela Colombia Honduras El Salvador Panama Mexico Costa Rica Belize Argentina Bahamas Dominican Republic St. Thomas St. Croix Trinidad Nicaragua Haiti Jamaica Puerto Rico Cuba
EDITOR'S COMMENTS
Crowley has strong operations between its Florida base, the Caribbean and Latin America. Its parent is a major auto transporter and shipping generalist. Provider's Strengths Strong operation in the lane between Central America and the U.S. Provider's Weaknesses Lack of global scope.
CASES & NEWS
Jacksonville, Fla., January 30, 2006 - Crowley to Carry Production Equipment for Newest James Bond Movie During the month of February, Crowley will carry 28 pickup trucks, 25 production trailers and 11 excavators, cranes, etc. for the filming of Casino Royale, the newest James Bond movie. The Columbia Pictures distributed movie is partially being filmed in Nassau and though the cargo will leave the US by way of Jacksonville or Port Everglades, Fla., some is originating from as far away as Europe. The 2006 movie shares its title with Ian Fleming's first Bond book and of the 1967 Bond spoof movie starring David Niven. After a long search, word is out that Thandie Newton has been cast as the newest bond girl, Vesper Lynd, while Daniel Craig will play Bond for the first time, making him the sixth actor to play the 007 role in the franchise. Shooting for the film will take the actors and crew from the UK to the Czech Republic, Italy and the Bahamas. Produced by Michael G. Wilson and Barbara Broccoli (Eon Productions) and directed by Martin Campbell, Casino Royale is scheduled for release November 17, 2006. Jacksonville, Fla. November 22, 2005 Nineteen Crowley Vessels Honored for Environmental Stewardship by Chamber of Shipping of America Crowley and its Marine Transport Lines subsidiary were recently named recipients of the Chamber of Shipping of America’s 2005 Environmental Achievement Awards. The companies collectively had 19 vessels that they manage and or operate that have achieved environmental excellence (zero incidents) for at least a three-year period. Of those 19, two vessels, tankers Blue Ridge and Coast Range have been incident free for seven years, while nine of the vessels have been incident free for five years. In all, 264 vessels were recognized by the CSA during the ceremony, representing over 1100 years of environmental safety. Crowley understands the importance of safety in everything we do,. said Tom Crowley Jr., chairman, president and CEO. .We strive to be incident free in our operations and believe that safety must be a mantra for all of our employees both shoreside and on our vessels. Crowley’s attention to detail is paying off. Earlier this year, the company was recognized by the State of Washington Department of Ecology’s highest award for excellence in tank-vessel marine safety and environmental stewardship. The Exceptional Compliance Program (ECOPRO) Award for the extended safe operation of its fleet of four articulated tug barges (ATBs). In addition, the Pacific States/British Columbia Oil Spill Task Force presented Crowley with a 2005 Legacy Award for oil spill prevention, preparedness, and response. The Task Force gives Legacy Awards for projects, accomplishments, or leadership that demonstrates innovation, management commitment, and improvements in oil spill prevention, preparedness, or response resulting in enhanced environmental protection. With the most recent award, Michael Bohlman, Chairman of the Board of CSA said, These awards are a testament to the dedication and professionalism exhibited by our seafarers and the shore-side personnel who are responsible for operating our vessels to the highest environmental standards. It is encouraging to see how many vessels continue to achieve environmental excellence year after year and it is with pride that we offer this recognition today. We in the maritime industry take our stewardship of the marine environment very seriously. Jacksonville, May 25 2005 - Crowley.s liner services group has been notified by US Customs and Border Protection (CBP) of its successful fullcompany Validation. in the Customs-Trade Partnership Against Terrorism (C-TPAT) Program. Less than 10 percent of the approximately 9,000 individual members in the C-TPAT program have undergone and passed the rigorous
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validation audit, which can provide a host of benefits for customers. Crowley.s C-TPAT program certification and validation results in a more secure supply chain and a reduction in customers. time-to-market transfer of cargo from point of origin loading to delivery destination. The notification of Crowley.s validation was made during an international trade symposium in Miami, which was attended by CBP Commissioner Robert Bonner. Ft.Lauderdale, Fla. . October 05 2005 - Crowley announced today that it has acquired Titan Maritime LLC, a worldwide salvage company based in Fort Lauderdale, Fla. The newly acquired company will be known as .Titan, a Crowley company. Former owners, David Parrot and Dick Fairbanks, will remain as part of the management team with the new entity, as will all Titan employees. Crowley.s Todd Busch will join Titan as vice president and relocate from Crowley.s Long Beach office to Titan’s Fort Lauderdale office. Busch has been with Crowley for 17 years, and has held management roles in ship assist and escort, contract and towing services, and emergency response. Jacksonville, Fla. January 18, 2005 - Crowley and Toyota Celebrate the Shipment of the 150,000th Toyota Vehicle from Jacksonville to Puerto Rico. Over 300 Crowley and Toyota Logistics Services employees gathered to celebrate the shipment of the 150,000th Toyota vehicle to Puerto Rico from Jacksonville. The ceremony and luncheon took place at Crowley’s Talleyrand terminal yesterday where the Toyotas are regularly loaded onto large ocean-going barges for the trip to San Juan. Beginning with their first shipments of cars from the U.S. to Puerto Rico in 1992, Crowley has been the exclusive carrier of Toyota vehicles to Puerto Rico. The company has nine triple deck barges, some of which are more than two football fields long, which are towed by large oceangoing tugs between Jacksonville and San Juan. The vessels and Crowley’s vehicle handling processes continually meet Toyota’s strict standards for quality. Crowley reinvests profits to maintain and enhance the car decking on its vessels such that all have padding, alignment lines, and fresh paint. The padding on posts and rails and alignment lines were added to minimize the potential for damage to vehicles during the loading and unloading process. The vessels are equipped to accommodate between 200 and 400 vehicles per voyage. Crowley employs a dedicated team of auto checkers and traffic specialists to handle vehicle shipments. The terminal’s entire traffic department plays a large role in ensuring that load lists are correct and documentation is complete. Because of Crowley’s attention to detail, the company has been awarded the prestigious Toyota Logistics Services Award of Excellence in Customer Service for the past four years. .Last year marked a record in our 13 year partnership with Crowley," said Bob Wade, corporate manager, international logistics. "Toyota's market share in Puerto Rico was 31 percent and we couldn't have done it without you. We thank Crowley and congratulate you for your continued commitment to excellence. Speaking of excellence, Wade continued by congratulating Crowley employees for achieving record low damages in shipping Toyota vehicles to Puerto Rico in 2005. Noting that damage frequency and severity had dropped to a fourth of the levels in 2002, Wade said, “You did this because you care about how you handle our products, because you care about how you do your jobs, because you are professionals. We at Toyota recognize this, and we thank you for it. "We are proud to have been Toyota’s partner to Puerto Rico for the past 13 years, said Rob Grune, Crowley senior vice president and general manager of Puerto Rico and Caribbean services. They take quality and service very seriously as do we, making it a healthy partnership for all who are involved. Toyota established operations in the U.S. in 1957 and currently operates eight US manufacturing plants, with two more under construction. There are over 1,400 Toyota, Lexus and Scion dealerships located in 50 US states and there are 31 in Puerto Rico including 24 Toyota, six Scion and one Lexus dealership. Selling over 2 million vehicles in the US in 2004, Toyota has a direct US investment of over $13 billion and direct US employment of over 31,000. According to a 2005 Center for Automotive Research study, Toyota, along with its dealers and suppliers, has generated over 386,000 U.S. jobs - including jobs created through spending by direct, dealer and supplier employees. In addition to its cars shipped within the continental U.S. and into Puerto Rico, Toyota ships approximately 11,000 vehicles per year to Hawaii as well. Jacksonville, Fla.-February 22, 2006 - Crowley has been named as one of three finalists for two industry awards to be given by Containerisation International. The two categories are Investment in People and Corporate Social Responsibility. For the Investment in People award, Crowley has to demonstrate its commitment to training and raising standards within in industry. Other finalists in this category are Evergreen and Maersk Logistics. Judges said Crowley continued to develop its strong emphasis on practical training, with job shadowing and cross-training efforts gaining momentum. They were also impressed with the clear skills evaluation and links to performance for the individual. For Corporate Social Responsibility, Crowley had to demonstrate an innovative and pioneering approach in the field of corporate social responsibility with specific projects - environment, community or human rights initiatives. Others in contention for the award are Evergreen and the Port of Tacoma. Judges said Crowley showed a strong integration of the principles of CSR across the company, and they were particularly impressed with its development of its Operational Excellence Management System, which showed strong environmental stewardship across its fleet. Awards will be announced March 23rd in New York.
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Company Name CS International Logistics (USA) LLC Address: 5200 West Century Blvd., Los Angeles, CA 90025 USA Phone Number: 310-670-3800 Email Address:
[email protected] Fax Number: 310-670-0094 Website Address: www.cargofe.com
Subsidiaries or Related Companies Cargo Services (China) Limited N Cargo Services Airfreight Limited Asian Logistics Inc.
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Cargo Services Far East Limited Asset Focus: Int'l (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1990
OVERALL CAPABILITY
Overall Capability of Provider: China/Hong Kong operator expanding to U.S.
KEY PERSONNEL
John Lau Barry Ng Tim Ngan Deputy Managing Managing Dir. Deputy Managing Dir.
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 350 70 * 1,700 8 2 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 5 Total Reefers: Total Flatbeds: Total Tankers: Total Other: 8 Total Transportation Assets: Total Tractors: 100 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 15 120 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 16 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 1 (Million) 5
Asset Ownership v.s. Leased: Transportation Equipment: Owned Warehouses/DC's: About 50/50
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 270000 Total Annual Airfreight Tonnes: 14000
MARKETS
Apparel/Garments Utilities Consumer Goods Industrial
(For functional specializations, see "Customers" section.)
Retailing Textiles
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Edison Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Edison Edison EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Edison Edison
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials Other Services:
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: Hong kong, Shenzhen
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Crystal Knitters Davidoff Escada Esprit G2000 GE Lighting Gucci H2O Cosmetics Hong Kong town Gas Lane Crawford Matalan Prada Sodimac Woolworths
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by CS International Location
China China China China China Hong Kong China China China
Industry
Textiles Consumer Goods Apparel/Garments Retailing Apparel/Garments Industrial Retailing Consumer Goods Utilities Retailing Retailing Apparel/Garments Retailing Retailing
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
China China Chile Australia
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COUNTRIES with OFFICES
Africa Asia
China Dubai Hong Kong India Pakistan Singapore
Countries served through owned offices or agents Australia / Pac.Isles
Australia New Zealand
CS International North America
Canada Mexico United States
Europe
Belgium France Germany Italy Turkey United Kingdom
South/Latin America
Argentina Brazil Chile Ecuador Columbia
EDITOR'S COMMENTS
CS International recently opened a U.S. office. Their sister company, Asian Logistics, is a Los Angeles-based NVOCC. Provider's Strengths Provider's Weaknesses
CASES & NEWS
Site Visit Competition for the Big Guys Cargo Services Far East Hong Kong – February 28, 2005 Tour Guides: Kevin Lam, Asst. Managing Director Gilbert Wong, Business Development Director Cargo Services Far East (CSFE) has a core management group of five in Hong Kong. The company founder, John Lau, started the business in 1990 after experience with export buying and container operations. His key associates went to college in Canada and the U.K. They bring work experience from Maersk and airfreight forwarders. CSFE handles about 120,000 TEUs per year as an NVOCC and 150,000 TEUs as a liner agent for smaller shipping lines. It handles 14,000 metric tonnes of airfreight. Air freight has grown quickly since 1994. There are 22 offices in China and Hong Kong. The company has key offices in Los Angles, Dubai, Karachi and Singapore. Warehousing and supply chain management are done in owned facilities in Hong Kong, Shanghai and Shenzhen. There is a 30,000 square foot bonded warehouse and more than 650,000 sq.ft. CFS/CY in Shanghai. There is another leased SCM operation in Singapore. The Hong Kong office is in the ATL Logistics complex at the Kwai Chung container port. Shanghai operations are in Pudong, Baoshan and Jiading. Cargo Services Far East has 100 trucks for distribution in Hong Kong, with 70 of them having the cross-border licenses to undertake jobs between Hong Kong and southern China. It also has 15 units of tractors in Shanghai. Lau and company provide a host of “buyer-like” services for supply chain customers. These services involve collection and handling of samples, handling of materials to the production facilities, tracking of production and freight forwarding services. While CSFE charges for these services, the costs are significantly less than typical buyer’s commissions of 6-7%. CSFE uses a web-based inventory/transportation management system called ediTrack. CSFE customers using CSFE and ediTrack are WalMart/ASDA, Woolworths Limited, Matalan, John Lewis, Rosebys Bed/Bath/Home and others. As a regional freight forwarder, CSFE’s principal customers are Sodimac, Kohler, Towngas, Actona, William Levene, etc. It operates two brand names, Far East Cargo Line and Ocean Navigator Express (ONE) Line to give global coverage. The key internet tracking piece is CargoTrack for these services. Other key pieces of information: Airfreight customers are FCUK, Lane Crawford, Espirit, Marc Jacobs, Swatch and others. Liner agencies are for ANL, Maruba, AAL, PAS and TOL. Cargo Cold Chain Logistics handles perishables and frozen product. CSFE does a fair amount of garment-on-hanger business. Lau and his colleagues are planning an expansion in China over the next two years. 16 additional offices are planned, with an emphasis on the Yangtze (Changjiang) River basin. CSFE strikes us as an aggressive, low cost competitor not afraid to take on the likes of DHL/Danzas. They hold all the necessary licenses from the People’s Republic of China, including a domestic logistics license. They are a major player in China now and should increase market share going forward. Largest Privately Held Supply Chain Network In China Opens U.S. Division LOS ANGELES, OCTOBER 13: The largest privately held supply chain network in China with annual revenues exceeding $200 million, has just opened a U.S. division under the direction of one of the most experienced cargo executives in the international logistics industry. CS International Logistics (USA) LLC, with headquarters in Los Angeles, is offering complete supply chain management solutions for U.S. companies trading in China, now the largest exporter to the United States. This new division, a subsidiary of Cargo Services Far East based in Hong Kong, is headed by Sam Schotsky, a thirty year cargo veteran with much of those three decades involved in U.S.-Asian freight forwarding. In making the announcement of Cargo Services' new U.S. division, Schotsky stated, "we believe our company is in a unique position to respond to the many differing logistics needs of companies importing both consumer and business products from China. We have the people, the expertise and the physical infrastructure within China."
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Schotsky noted that Cargo Services currently has 19 owned and operated offices (not agents) in China with a trained, experienced staff numbering "just under two thousand." The company is planning to open an additional 15 offices by late 2005, in China. Additional staff will be hired to accommodate this growth. Schotsky emphasized Cargo Services' offices are located not only in centers along the Chinese coast where much of China's industry now is concentrated, but also in the lower labor cost inland cities that are fast growing sites for manufacture and commerce. Cargo Services also has recently opened offices in Pakistan and the United Arab Emirates. Cargo Services holds numerous licenses that allow it to offer complete logistics services in China without any kind of intermediary. "Holding these licenses (Class A Forwarders, NVOCC, Domestic Logistics, Air Transport Qualification Certificate) which few private companies actually possess, allow us to offer complete sea and air freight forwarding as well as rail and truck transportation within China," asserted Schotsky. The U.S. chief executive noted that as trade between the U.S. and China grows larger, it also grows more complicated. "Moving cargo from a container berth or an airport across the Pacific is the final and often simplest part of the process," Schotsky stated. "Terms and conditions for exporting merchandise start right on the factory floor and the logistics firm must be prepared to cope fully with these circumstances. Cargo Services Far East offers complete factory audits, special export documentation when required, assurance that quality control inspection procedures have been followed, even if fumigation of the product is necessary." "Another critical consideration is how rail and truck can be used most efficiently, particularly from inland points," said Schotsky. "These and many other questions can be answered only by an organization with a thorough and detailed knowledge of Chinese regulations and procedures," he averred. Schotsky noted that Cargo Services' twelve years of China operations "give us a big competitive advantage in meeting total clients' needs in this huge and dynamic market." Referring to Cargo Services' electronic capabilities, Schotsky stated the company's IT system is arguably the most advanced of any logistics firm servicing the China market. "It is user friendly, with customers having visibility and management control along each step of the journey-from purchase order placement to arrival on the customer's dock." While CS International Logistics (USA) is new to the U.S., its parent, Cargo Services Far East is an "old China hand." The company opened its doors in Hong Kong in 1990, entered China itself in 1992 and has expanded rapidly to keep pace with the rise of China as a great exporting nation. Last year, Cargo Services Far East handled 250,000 TEUs and 13,500 metric tons of air cargo, a record for the company. Today, its U.S. division, CS International Logistics, offers complete supply chain logistics and freight forwarding services to and from the Asian market. In addition, Cargo Services Far East is a growing force in the importation of consumer goods to a seemingly insatiable China market. The company offers "one stop" shopping for importation of merchandise into that country by providing customs clearance, inventory management, logistics and distribution of goods to distributors or retailers.
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Company Name Companhia Vale do Rio Doce Address: Av Graca Aranha, 26 Andar, Rio de Janeiro, Brazil 20005-900 Phone Number: 38144617 Email Address:
[email protected] Fax Number: 381444411 Website Address: www.cvrd.com.br
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Companhia Vale do Rio doce S. America (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1942
OVERALL CAPABILITY
Overall Capability of Provider: Very good bulk commodities company.
KEY PERSONNEL
Guilherme Laager Mauro Dias Eduardo Bartolomeo Exec. Director Commercial Director Operational Director Carlos Ebner Francisco Nuno New Bus. Director Planning & Control Dir.
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 8,479 2,573 * 11,000 100 5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol CVRD Exchange: BeveSpa/NYSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 5 31,969 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 14 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: About 60/40 Warehouses/DC's: About 50/50 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Agriculture Consumer Goods Automotive Food, Groceries Beverage Metals
(For functional specializations, see "Customers" section.)
Building Materials Oil & Energy Chemicals
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Visibility (Manugistics) Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Visibility Visibility Visibility EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Acesita ADM Ambev Basp Cargill Degussa Exxon Ford Motor Gerdau LaFarge Nestle Unilever
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by CVRD Location
Sao Paulo Sao Paulo
Industry
Metals Agriculture Beverage Chemicals Food, Groceries Chemicals Oil & Energy Automotive Metals Building Materials Food, Groceries Consumer Goods
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Sao Paulo Sao Paulo Vitoria Vitoria Sao Paulo Rio de Janeiro
Vitoria
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
CVRD South/Latin America
EDITOR'S COMMENTS
CVRD Logistics operations grow as a necessary part of its mining and rail activities. It is the world’s largest iron mover. Bulk operations are very good. Other operations are growing but have limited sophistication. Provider's Strengths Bulk commodities, rail transportation and mining. Provider's Weaknesses Lags in consumer products distribution.
CASES & NEWS
Site Visit Vitoria/Tubarao December 4, 2002 CVRD invited us to Sao Paulo to talk to its major customers on December 4, 2002 about third-party logistics. Many of Brazil’s major exporters and importers attended to hear about CVRD’s expanding interest in logistics and initiation of 3PL services. Our visit to the Tubarao facility was a follow-up to see some of CVRD’s basic operations. Tubaro is a large port covering 18 square kilometers. It is the primary outlet for CVRD’s iron ore mining operations. 75 types of iron pellets are shipped from Tubaro to smelters around the world. Other bulk commodities shipped from and to the facilities include wood pulp, coffee, cement and granite outbound. Inbound commodities are petroleum products and fertilizer. CVRD has 3,600 employees at this location in addition to 6,000 contractor employees work here. Operations are heavily automated emphasizing tram car dumpers, conveyers and cranes A centralized computer control system provides efficient 24/7 coverage. CVRD maintains and replants the trees, bushes and other flora on this peninsula. As a result, the grounds are pleasant for a port facility. In addition, CVRD practices extensive dust control and the waters around the port look quite clean. The railroad has one meter gauge track and ties to the system throughout south-central Brazil, running inland to the Belo Horizonte mining area. (Throughout North America, Europe and Asia the standard gauge is 1.44 meters.) At this point some explanation is in order. CVRD owns four rail lines. These operations primarily connect the coast to the interior and operate North and South along the coast in the bottom half of Brazil. The Corajas Railroad runs into the Amazon basis. It was built by CVRD using its own funds. The other railroads were built by the government and CVRD. Until 1998 the Brazilian government owned CVRD. CVRD also has five steamships left from a fleet high of 22 a few years ago. The CVRD railroads are operated through a modern computerized traffic control center. Rail operations include passenger routes between Belo Horizonte and Vitoria. CVRD also maintains two berth container port operations (TVV) in Vitoria. This operation handles 165,000 TEUS a month and is at capacity. About 8,000 square meters of warehouse space is available and is nearly full of inbound cast ore materials. Most inbound products are high-value consumer goods. Most outbound is coffee and granite. The Vitoria port allows for a maximum vessel size of 3,500 TEUS. CVRD has plans for adding a large yard and distribution center a few kilometers from the port. This facility will be critical for CVRD’s 3PL development. CVRD controls the majority of shipping between Brazilian ports. CVRD does almost $3 billion a year in transportation. Given the infrastructure and profitability it has in Brazil, it has the resources to become a dominant 3PL. Guilherme Laager, the new VP in charge of logistics is assembling a group of young managers to help him change CVRD to become a modern integrated logistics manager and 3PL. We believe CVRD is well positioned to be one of the major 3PLs in South America. Growth for inbound consumer products should be substantial. To get a feel for the scope of this company visit www.cvrd.com.br. 2004, A Record-Breaking Year Rio de Janeiro, March 21, 2005 – Companhia Vale do Rio Doce (CVRD) posted net income of US$ 2.573 billion in 2004, 66.3% higher than its previous record income of US$ 1.548 billion, in 2003. Earnings per share was US$ 2.23. Return on equity (ROE) was 34.8% exceeding the 31.7% ROE of 2003. A combination of three factors made it possible for CVRD to break new records while creating substantial value for its shareholders: (a) strong growth in global demand for ores and metals; (b) expansion of capacity in all the Company’s operational activities, resulting from implementation of highly competitive projects and successful acquisitions; (c) important efficiency gains. Total shareholder return over the period 2001-2004 reached, an average, 38.9% per year. In 2004 it was 45.9%. The operating performance was excellent: Adjusted BIT (earnings before interest and taxes) almost doubled, from US$ 1.644 billion in 2003 to US$ 3.123 billion in 2004. The adjusted EBIT margin, of 38.7%, was the highest in CVRD’s history. Cash flow measured by adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was US$ 3.722 billion, compared to US$ 2.130 billion in 2003. Several other records were attained in 2004: gross revenue US$ 8.479 billion, was 52.9% higher than in 2003; volume of iron ore and pellets sold, 231,043 million tons, was 24.0% higher than in 2003; sales of manganese ore exceeded the 1-million-ton mark for the first time (vs. 885
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thousand tons sold in 2003); shipments of ferro alloys were 616 thousand tons, 22.7% up from 2003; bauxite sales increased 41.0%, from 1,472 millon tons in 2003 to 2,076 million tons in 2004; CVRD’s railroads carried 28,743 billion ntk of general cargo for clients in 2004, compared to 26,295 million ntk in 2003. Four important projects were completed in 2004; the Sossego copper mine, the expansion of iron ore production capacity at Carajas to 70 million tons per year, the Pier III of the Ponta da Madeira maritime terminal, and the Candonga hydroelectric power plant. The Company invested US$ 1,956 billion in the eyar, the second highest annual figure in its history, in real terms. From this amount, US$ 1,245 billion was spent on organic growth, US$ 568 million on sustaining existing business, and US$ 143 million on acquisitions. In 2004, CVRD distributed US$ 0.68 per share in dividends to its shareholders, 15.7% more than in 2003 and 29.7% more than in 2002. Logistics: new record in railway transportation, port services and coastal shipping CVRD’s logistics services provided revenue of US$ 877 million in 2004, 45.2% more than in 2003, contributing 10.3% of the Company’s total revenue for the year. Railway transportation of general cargo for clients, on the Carajas, Vitoria-Minas, and Centro-Atlantica railroads (EFC, EFVM, FCA) produced revenue of US$ 612 million. Port services added US$ 173 million, and coastal shipping and port support services US$ 92 million. CVRD’s railroads transported 28.743 billion ntk of general cargo for clients, 9.3% more than in 2003, a new all-time record. The main cargos transported were steel industry inputs and products (46.6%), agricultural products (32.2%) and fuels (9.8%). On all three railroads the revenue per thousand ntk (KNTK) of general cargo increased: on EFVM, from US$ 13.94 in 2003 to US$ 16.83 in 2004; on EFC, from US$ 12.48 to US$ 14.57; and on FCA from US$ 16.82 top US$ 21.56. Volume transported in 4Q04, at 6,907 billion ntk, was higher than 4Q03 (6,402 billion ntk), though volume carried in 4Q04 was lower than in the two previous quarters, a seasonal effect reflecting the grain harvests; the peak is usually in the third quarter, with a decline in the fourth quarter and the subsequent first quarter, recovering in the second quarter. Reduction of accidents is one of CVRD’s main goals in the operation of its railroads. Even operating at full capacity, the Company has succeeded in reducing the number of accidents in recent years. Between 2001 and 2004 the Company was able to reduce the number of accidents in its railways at an average annual rate of 13.1%. The Company’s ports and maritime terminals handled 28,741 million tons of cargo for clients, 7.2% more than in 2003. Volume in 4Q04 was 7,097 million tons compared to 5,288 million tones in 4Q03. Infrastructure: CVRD to tap Chinese for logistics investments "The whole area of mining and agriculture requires investments in infrastructure. We need to discuss the best way of leveraging investment in this area," he said. "CVRD is investing over US$100mn a year in logistics projects up to 2010 and the Chinese could be partners in these undertakings." Stoliar could not specify any projects the company is discussing with Chinese partners. Private-public partnerships (PPPs) are considered possibilities and the Chinese ideal partners for infrastructure projects because of the availability of Chinese funds for investment and their interest in lowering transport costs, he said. Brazil's development, industry and trade minister Luiz Fernando Furlan said Chinese investors could invest US$5bn in the country in the short term. One project CVRD is backing is the construction of a cargo ship with a 500,000-540,000t capacity, which would reduce transport costs to Asian markets, Stoliar said. "CVRD does not necessarily need to be the owner of the ship. The idea is to make it feasible," he added. The ship would take some two years to build. Other transport projects which interest CVRD and Brazil's agriculture sector are railroads. Some rail lines under study are a route from central west Brazil to the Pacific and one from central Brazil north to Maranhão state. Case In Point: Nestle The Nestle case was an example of a well-interpreted opportunity. Intermodal management had verified that Nestle was transporting between one of its factories and a Storage Depot via highway in a region where we have a railway. Accordingly, we proposed a new alternative for this transport, offering a more reasonable cost in addition to other advantages like increased security, a decrease in the occurrence of cargo damage and railway regularity. The operation began in September 2002 with the transfer of “Leite Moca” between the Montes Claros (MG) factory and the Cordeiropolis (SP) Storage Depot using the Express Train. A new opportunity was identified soon after the operation began: take advantage of the containers shifted to pick up the Leite Moca and supply the Montes Claros factory with some input. The best input to supply was sugar. After optimizing the transport with the closed cycle of sugar – Leite Moca, we also began to directly deliver Leite Moca to large retailers. Transfer Operation + Direct sale of Leite Moca Use two 20 –foot containers per wagon for better utilization Increased security by placing the containers door-to-door Monthly average of two hundred 20 foot containers, totaling 4.3 thousand tons/month, equal to 50% of the Montes Claros factory monthly production Operation Inbound Sugar Best usage: 18 bags per 20-foot container Using slip-sheets to separate the bags Use two 20-foot containers per wagon platform
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Operation Benefits: Zero incidence of stolen cargo Damage indicator less than 0.01% of the transported cargo volume Lower operation costs Point inventory formation Railway regularity
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Company Name CWT Distribution Ltd. Address: 24 Jurong Port Road, #03-00 Office Block, 619097, Singapore Phone Number: 65 6262 6888 Email Address: Fax Number: 65 6264 0790 Website Address: www.cwt.com.sg
Subsidiaries or Related Companies Fuzhou Harbour CWT Asset Focus: (A = Asset Based, N = Non Asset Based) PSA - China Logistics CWT - SML Logistics CWT Global Link
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Temasek Holdings Limited Int'l Year Started in Logistics: 1970
OVERALL CAPABILITY
Overall Capability of Provider: NVOCC and contract logistics company with modern skills and good chemical specialization.
KEY PERSONNEL
Loi Pok Yen Lau Chee Tiun Aruthur T.L. Thum CEO Deputy CEO, Strategic Projects COO Lyndah Goh Foo Say Chuang GM Corp. Serv. GM Bus. Dev.
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 130 14 * 1,800 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 100 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 100 Total Reefers: Total Flatbeds: Total Tankers: Total Other: 100 Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 10 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Owned/Leased Warehouses/DC's: Mostly Leased 1.7 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Chemicals Healthcare Industrial
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): I DASH, I SCM Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition i SCM MediHub, iDSC
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Singapore Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
E. I. DuPont Mineba Nagase Tomoe Shoka
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by CWT Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Chemicals Industrial Chemicals Healthcare
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COUNTRIES with OFFICES
Africa Asia
China India Malaysia Pakistan Sri Lanka Thailand United Arab Emirates
Countries served through owned offices or agents Australia / Pac.Isles Europe
British Virgin Isles
CWT North America South/Latin America
EDITOR'S COMMENTS
CWT is growing its integrated services and distribution operations. CWT has a strong competency in chemical logistics. NVOCC operations account for two-thirds of revenue. Contract logistics is about one-fourth of revenue. Provider's Strengths Chemical logistics. Provider's Weaknesses limited to niche offerings.
CASES & NEWS
CWT Distribution gets up close and personal with its haulers CWT Distribution invested in a transport management Web portal to streamline its operations with its outsourced haulers, resulting in less human errors, more lead time and increased visibility in job tracking. In the business of logistics, speed and accuracy reigns supreme. The supply chain manager that can ship faster and commit fewer errors has a competitive edge over its less able rivals. Which is why logistics services provider CWT Distribution invested in building iDASH, a transport management Web portal, to better integrate its operations with its haulers - so that they can work faster and make less errors. With so many papers and information to deal with, the previous manual process of using fax, phone and e-mail was not satisfactory as it was slow and prone to errors, said Mr. Lim. Another problem was trying to get the haulers to expedite on urgent jobs, which was typically done by sending faxes. 'You send them 10 faxes, someone else sends them 5, or worse, someone grabs a whole stack of faxes only to realize at the end of the day the last 5 faxes are not his.' Since CWT outsources some of its transport operations to its haulers, it was imperative that a better and more automated system needed to be put in place. With iDASH (which stands for Intelligent Digital Alliances of Singapore Haulers), CWT is able to connect its control room to its haulers control rooms directly and automate the communications and processes that take place between the various control rooms. 'With iDASH, we can minimize data inaccuracies, increase lead time and improve visibility,' said Mr. Lim. Features of iDASH iDASH is integrated into CWT's supply chain management backbone called iSCM. So when customers send jobs to CWT electronically through the iSCM system, the jobs are then ported into the iDASH system which then automatically assigns the jobs to the haulers based on business rules. The haulers have to respond to a job by a certain time, failing to do so will mean that it may be transferred to another hauler. As the haulers carry out their transportation operations, their field staff have to keep their control room updated at every stage of the process, and the latter in turn keeps CWT's control room updated, so there is a clear visibility in tracking the jobs. Because iDASH is integrated with custom's information database, the haulers do not need to perform additional searches like the time of arrival of the vessels or the location and numbers of the containers. All the requisite information is already received by the haulers when CWT sends them the job order. This process shortens order processing time, minimizes tedious volume paper transactions and improves data accuracy, said Mr. Lim. With the detailed job-tracking, CWT, as well as its customers who are connected to its iSCM system, has a clear visibility of whether the cargo will arrive in time. If some jobs are running late, iDASH automatically flashes an amber warning light. CWT's controllers can then ask the haulers' controllers to expedite on those particular jobs. Meeting deadlines are essential, especially when many of CWT's customers rely on 'Just-in-time' inventory management. The iDASH system also helps CWT to track the performance of its haulers and more importantly, automatically does the invoicing as well. 'Now there is a more systematical way of invoicing and keeping track of all the jobs,' said Mr. Lim. EA Awards - CWT Distribution IE Team, 1-Nov-2004 Healthcare organizations that manage the flow of medical supplies used to face the challenge of delivering low volume, high-mix supplies to multi-site clinics. And with the clinics typically placing orders individually to various suppliers, uncoordinated and ad-hoc deliveries seemed to be the norm. That choked up daily workflow at the clinics, and bogged down healthcare professionals with logistics activities. And as the clinics often lacked proper storage areas for supplies, the excess stock would invariably clutter up valuable work-areas. In response to that, CWT Distribution—a logistics services provider for National Healthcare Group Diagnostics (NHGD), a division of the National Healthcare Group (NHG) that manages the laboratories and imaging services in the nine polyclinics across Singapore—decided to set up Medi-Hub. Medi-Hub is a Web-based supply chain e-solution to streamline, integrate, and improve logistics operations for the healthcare industry. CWT’s technology partners for the project included Oracle, Hewlett Packard, Sybase, and Microsoft. CWT’s in-house IT team used the J2EE development framework—Oracle database, Java, and Silverstream—as it simplified the application development in its thin client environment and allowed the creation of standardized reusable components. XML and Enterprise Java Beans (EJB) were used to form the base of the enterprise application infrastructure (EAI) module for data
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interchange between the subsystems. JSP and HTML were used as application development tools for Web layering. The project ran on HP’s Compaq Proliant, HP-UX, and Microsoft Windows 2000. During the development process, the greatest challenge faced by the team was to translate the company’s business requirements into technical capabilities. To overcome this, it formed a cross-functional project team consisting of domain experts, process engineers as well as IT analysts, who painstakingly identified and mapped each business requirement into technical specifications. The team also adhered to established standard operating procedures that they put together, to ensure that the Medi-Hub, a cross-enterprise project, did not compromise the security of CWT’s existing systems. The Medi-Hub portal, with an investment tag of US$162,000, was up and running in six months. Some of its features include demand aggregation, supplier management, online order management, intelligent consolidation of transport assets, integration with subsystems such as the warehouse and transport management systems, as well as online reporting. It also has an EAI component that links to major backend ERP systems. Clients in the life-sciences sector now enjoy the benefits of the Medi-Hub. It enables clients (i.e. clinics) to combine all their orders into one purchase order. For CWT, it is easier to consolidate the goods from various suppliers and schedule single delivery to each site on a more regular basis. As the Medi-Hub displays information in real-time, it provides transparency of inventory, delivery, and other management information, enabling clients to better manage and control their supplies. For instance, it has a built-in automatic mechanism that prompts staff to replenish stock with low inventory levels and those nearing expiry, thus reducing the reliance on manual monitoring. Its online order management module has order quantity limits; it also maintains a client-defined safety stock level to counter variability in consumption and replenishment. Other benefits include more effective batch management, a central point of visibility and control, as well as more efficient reporting. The reduction of costs to CWT’s clients, such as NHGD, is another achievement—enabled by the reduction of wastage, operations costs and bulk discounts negotiated from the suppliers. Last but not least, it has led to increased productivity. As the Medi-Hub enables clients (clinics) to track their consumption patterns, it helps them to forecast their consumption more accurately. This reduces delivery latency and wastage. The reduced stock holding levels at the clinics has freed up limited space. Unlike before, healthcare professionals are no longer bogged down by day-to-day logistics and warehousing functions. Reportedly, NHGD now spends 80% less time on logistics and inventory management.
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Company Name D. Logistics AG Address: Johannes-Gutenberg-Straße 3-5, D-65719 Hofheim (Wallau) Germany Phone Number: 49-6122-50-00 Email Address:
[email protected] Fax Number: 49-6122-50-1300 Website Address: www.dlogistics.com
Subsidiaries or Related Companies So.Ge.Ma. S.p.A., J&J Packaging Inc. Deufol Export Asset Focus: N, A packung GnbH, Deutsche Tailleur Industrieservice G Schumacher GmbH, D.Logistics Services N.V., Franks Industries Group., Donne+Hellwig Logistics GmbH (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: D. Logistics AG Int'l Supply chain mgmt Year Started in Logistics: 1998
OVERALL CAPABILITY
Overall Capability of Provider: Capable, modern contract logistics, including packaging.
KEY PERSONNEL
Detlef W. Hubner Andreas Bargendo CEO Chief Operating Officer Thomas Schwinger-Caspari Chief Financial Officer
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 397 397 * 3,210 20 1-8 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol LOIG.F Exchange: Frankfort
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 60 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Owned 7.1 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Plastics, Fibers Computers, Electronics Consumer Goods
(For functional specializations, see "Customers" section.)
Healthcare Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): InHouse/Outsourcing Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling InHouse/Outsourcing
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Acordis Industrial Fibers Agilent Technologies Audi Bosch Duracell Gillette Company IBM Pfizer Procter & Gamble Siemens Volkswagen
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by D. Logistics Location
Germany, NA, SA Europe Europe Europe Europe U.S., Europe Europe Europe Europe Germany Europe
Industry
Plastics, Fibers Computers, Electronics Automotive Automotive Industrial Consumer Goods Computers, Electronics Healthcare Consumer Goods Healthcare Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Korea
Countries served through owned offices or agents Australia / Pac.Isles Europe
Belgium France Germany Italy
D. Logistics North America
United States
South/Latin America
EDITOR'S COMMENTS
D.Logistics AG, founded in 1998 through mergers of various companies and publicly traded since April 1999, provides special services for industry, hospitals and airports. D. Logistics refers to itself as a 4PL and has a modern SCM orientation. D.Logistics has developed the Inhouse-Outsourcing system which is a registered trademark. It means that the company accomplishes the services it provides at the place of the customer or via direct connection with the customer's IT system. Services of D.Logistics deal with management of inventories, supply of goods, handling of cargo, packaging and labeling and other tasks. Additionally, the company provides consulting, personnel on a time basis and offers customized IT solutions. D.Logistics has subsidiaries in Germany and Belgium. Industrial and consumer goods logistics accounted for 43% of 1999 revenues; value added services, 28%; airport services, 14%; runtime services, 9% and IT/consulting, 6%.D. Logistics holds 85% of Franks Industries Inc. in Ohio, and J&J Packaging Company in Indiana. D. Logistics has had financial difficulties the last two years. (See below.) Provider's Strengths Modern logistics approach covering Europe. Provider's Weaknesses Unprofitable segments.
CASES & NEWS
D. Logistics downgrades profits forecast [Transport Intelligence, Nov. 28, 2003] D. Logistics, the acquisitive German contract logistics operator, has released its results for the third quarter of 2003, as well as re-appraising its full year forecasts. The company posted revenue figures of 78.6m euros, a reduction of 4.6% compared with the same quarter last year. However operating profit (EBITA)w as 1.6m euros, a major improvement on the 9.2m euros loss in 2002. Although the results are encouraging for the company, which severely over-reached itself financially through a highly aggressive acquisition programme, development is not progressing at the rate at which management had hoped. In particular its Consumer Goods Packaging segment is unlikely to meet its budget for the full year. Partly as a result of this, full year profits have been downgraded from 13.2m euros to 5m euros. Overall the management of the company is optimistic that the economic recovery in Europe and particularly in Germany is underway. This will have generally ameliorative impact on all of D. Logistics operations, compounding the benefits of its re-structuring programnme. For the current year, on sales of approximately 315m euros, management expects an operating profit of around 5m euros. Revenues are expected to grow organically by 5% in 2004. D Logistics [Consolidation 2003, Transport Intelligence]
Formerly known as Donne+Hellwig GmbH & Co. KG, the company has grown from a German based warehousing company to a major European player across a range of freight and logistics competences with a turnover of 484m in 2001. In 1998, when it decided to expand internationally, the company re-branded itself as D.Logistics and embarked on a major acquisition program. D.Logistics built a presence in five key market segments: airport services; consumer goods; packaging technology; chemical and automotive. Its acquisitions have allowed it to build capabilities and presence although after these acquisitions the company faced difficulties with the integration of its new subsidiaries. This, combined with the economic downturn in its core markets, led to a loss of profitability, and indebtedness which the company fround impossible to manage without fundamental changes. This led to the sale of one of its major acquisitions, Cargo Service Center (CSC), an airport ground handling operator, which it had only acquired a year previously. The original shareholders took over the running of the company and dismissed many of the board members in an attempt to return the company to profitability. The problems faced by D.Logistics demonstrate the dangers of embarking on an ambitious acquisition strategy without the necessary strength of management or the financial resources to ensure that new subsidiaries are properly integrated. D.Logistics says will sell low margin divisions FRANKFURT, March 6 (Reuters) - Ailing German airport cargo handler D. Logistics said on Wednesday it would sell its low-margin divisions to reduce its debt that nearly brought the company to its knees last week. The announcement follows last week's management shake-up that helped stave off a looming cash crunch as the company struggled to absorb the costs of a recent acquisition spree. Shares in D.Logisitics, which have shed 98 percent of their value from a peak of 110.50 euros in August 2000, were the sharpest gainers on the Nemax 50 by 1228 GMT, rising 12.1 percent to 2.69 euros. "The objective of the new company orientation is to streamline the business sectors. In doing so the cyclical divisions with lower margins will be sold," the company said in a statement. No company officials were immediately available for further comment. The firm said last month a new board of executive directors intended
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to "vigorously consolidate" its activities in 2002. "My guess is that they will probably sell their CSC air cargo unit. Also a sale of the logistics unit Infraserv is possible," said HVB analyst Markus Hesse, who has a sell recommendation on the stock. "But it will be difficult to find a buyer at a suitable price. Focusing on the core business is certainly the right step," Hesse added. The company said last Tuesday it had the backing of its creditor banks as it ran out of money. It said its liquidity crisis was over, as was the short tenure of former Chief Executive Ernst Gumrich, who was sacked along with two other board members. One of the firm's founding shareholders Detlef Huebner took over the role as chief executive. "The return of the company founder and majority shareholder Detlef Huebner is to demonstrate to the capital market that the majority shareholder is still fully involved with the company and has not disposed of any company shares, contrary to rumors on the market," Wednesday's statement said. New company orientation [via website, March 6, 2002]
The return of the company founder and majority shareholder, Detlef W. Hubner is to demonstrate to the capital market that the majority shareholder is still fully involved with the company and has not disposed of company shares, contrary to rumors on the market. In order to regain past profitability in the medium and long-term comprehensive steps are currently being examined. The problems have been recognized and are to be solved in the short term through targeted measurers. The objective of the new company orientation is to streamline the business sectors. In so doing the cyclical divisions with lower margins will be sold. The revenues from the sale are to be used primarily to reduce financial liabilities. Corresponding preparations for these measures have already been made. D.Logistics AG to Significantly Extend Chemical / Life Science Industry Competence Press Release - 22.02.2001 Hofheim/Germany, 22 February, 2001: D.Logistics AG of Hofheim (WKN: 510150) and Infraserv GmbH & Co. Höchst KG will intensify their existing cooperation in chemical and life science logistics. For this reason, D.Logistics AG has taken a 51 per cent participation in Infraserv Logistics GmbH with retrospective force as of 1 January, 2001. By joining the forces of Infraserv and D.Logistics, a customer relationship of many years' standing is turning into a jointly operated company. Currently Infraserv is the provider of all logistics functions to companies including Aventis, Celanese, Clariant, Elenac and LII. The move is a natural next step in D.Logistics' strategy of creating comprehensive industry solutions. By this joining forces, the recognized hazardous-materials competence of Infraserv will be combined with the supply chain services system of D.Logistics AG to allow offering the chemical and life science industries a whole range of innovative and comprehensive logistics solutions. From the start, D.Logistics together with Infraserv will enjoy a leading market position as a freight-independent provider of logistics services. The offering of the joint operation will combine factory logistics, confectioning/packaging, warehouse logistics, material-handling control, value-added services, controlling, information technology and consulting to form an end-to-end service system specifically designed to meet the requirements of chemical and life science markets. Also in this market segment, D.Logistics is consistently following its corporate strategy to act as a pure logistics services provider who handles all logistics processes without pursuing trading interests of its own, with the exclusion of actual transports. The joint operation will employ more than 750 staff and anticipates revenues of 228 million DM with an EBIT of 12 million DM for the current fiscal year. Based on these target figures, the new activities will contribute substantially to the results of the D.Logistics Group as early as in the first year of consolidation. In addition, the joint operation of the two companies will exploit synergy and restructuring potentials so that additional revenue improvements are to be expected. D.Logistics Strengthens Leadership Position in the Field of Innovative Packaging Services Press Release - 01.02.2001 Hofheim, Germany, 1 February, 2001 – D.Logistics AG, Hofheim (WKN: 510 150), the leading provider of innovative packaging services, has further extended its market position by acquiring three new companies: Deufol GmbH, Baumann GmbH and Baumann Technologie GmbH. Together, Deufol GmbH, Baumann GmbH and Baumann Technologie GmbH generate annual sales of DEM 70 million with 300 staff providing packaging services to clients including Siemens, Mannesmann, Barmag, and others. There is a clear trend towards increased outsourcing of high-quality logistics services such as packaging, to specialist companies. Outsourcing provides clients with a number of benefits including: 1. Unsurpassed process reliability in packaging (D.Logistics guarantees an error rate in the per-thousand range). 2. Up to 15 per cent lower process expenses. 3. Up to 25 per cent lower administration expenses. 4. Low fixed cost and high cost transparency. Employing over 2,500 packaging specialists, D.Logistics AG is now by far the largest provider of packaging services in Europe. By integrating packaging tasks with the popular Inhouse-Outsourcing“ System of D.Logistics AG, clients can now get innovative consulting, IT, packaging and logistics services from one source. KLM to sell cargo unit to D.Logistics AMSTERDAM, April 23, 2001 (Reuters) - KLM Royal Dutch Airlines (NYSE:KLM - news) said on Monday it would sell its Cargo Service Centre (CSC) division to Germany's D.Logistics AG (quote from Yahoo! UK & Ireland: LOIG.F) as part of the Dutch carrier's plans to focus on its core activities. KLM declined to disclose the sale price. CSC delivers cargo handling and services for more than 1.5 million tons of cargo annually through 65 stations in 17 countries, KLM said. The agreement comes after KLM and D.Logistics last year signed a letter of intent for the transaction. D.Logistics said it would finance the purchase with real estate asset sales and short-term loans. --------------------------------------------------D.Logistics appoint Ralf Jahncke as CEO of Cargo Service Center [eyefortransport] D.Logistics has appointed Ralf Jahncke as chief executive officer of Cargo Service Center (CSC). CSC, an air cargo ground services company, was acquired by D.Logistics from KLM earlier this month. (5/2/2001)
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According to Mr. Jahncke, chief sales officer and head of two business units of D.Logistics chemicals and healthcare and airport services, also takes the role of chairman of both the new board and the extended board of CSC.
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Company Name De Rooy Logistics BV Address: De Hooge Akker 6, 5661 NG Geldrop Netherlands Phone Number: 31 40-289 55 55 Email Address:
[email protected] Fax Number: 31 40-289 55 66 Website Address: www.derooylogistics.nl
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1923 Market Area: Founding Business: Europe Trucking (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Good automotive 3PL and JIT specialist.
KEY PERSONNEL
John Fremeiger Managing Director
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 230 230 * 425 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 60 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 100 Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 60 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 100 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 6 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Owned Warehouses/DC's: Owned 0.5 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Appliances Office Equipment/Machines Automotive Technology Consumer Goods
(For functional specializations, see "Customers" section.)
Food, Groceries Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Europe Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
BOVA BSN Glasspack Campina Cannon Daf DaimlerChrysler Faurecia Keytec LG Philips MCFE Mercedes-Benz Mitsubishi Nedcar Nimag
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by De Rooy Location
Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe
Industry
Consumer Goods Automotive Food, Groceries Office Equipment/Machines Industrial Automotive Automotive Technology Consumer Goods Industrial Automotive Automotive Automotive Technology
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Benelux Czech Republic France Germany Hungary Netherlands Poland
De Rooy North America South/Latin America
EDITOR'S COMMENTS
De Rooy subassembles, provides dedicated transportation runs and JIT. Integrated VAWD and transportation operations are solid. Provider's Strengths Provider's Weaknesses
CASES & NEWS
Contract Faurecia [January 1, 2004] Sittard: De Rooy Logistics and Faurecia have signed a long term agreement for Logistics Services around the manufacturing process of carseats for NedCar. These seats are for the new smart ForFour and the Mitsubishi Colt. Contract DaimlerChrysler [March 1, 2003]
Geldrop: De Rooy Logistics and DaimlerChrysler have signed a contract for the in-night distribution of Mercedes-Benz car parts and truck parts in the Netherlands. For this purpose DRL has invested in a new fleet of Actros and Atego trucks. De Rooy Logistics acquires the company Jan Schoenmakers Transportaten [October 2, 2002]
De Rooy Logistics takes over all activities of the international transport company Jan Schoenmakers Transporten BV per 30-09-02. The family owned company Jan Schoenmakers Transporten has since 1927 an excellent reputation in the international transport market. Their activities, customers, truckfleet and personnel match very well with the logistic Services of De Rooy Logsitics (DRL) in the Automotive and Industrial market. This take-over must be seen in DRL’s strategy of growth, both autonomously as through acquisitions.
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Company Name DFDS Transport Solutions Group A/S Address: Litauen Alle 4, DK-2630, Taastrup, Denmark Phone Number: 45 7215 2700 Email Address: Fax Number: 45 4325 3541
[email protected]
Website Address: www.dfdstransport.com
Subsidiaries or Related Companies DSV Group Asset Focus: (A = Asset Based, N = Non Asset Based) DFDS Transort A/S DFDS Air & Sea Holdings A/S Franz Maas
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: DSV A/S Int'l Year Started in Logistics: 1976
OVERALL CAPABILITY
Overall Capability of Provider: Major Scandinavian-based transport and logistics company.
KEY PERSONNEL
Brian Winther Almind Ian Runge Petersen Managing Director Sales Director
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 150 100 * 700 500 1-10 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 29 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Leased Warehouses/DC's: Leased 2.9 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: >1000 Total Annual Airfreight Tonnes: >100
MARKETS
Automotive Food, Groceries
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): CargoLink Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition CargoLink Red Prairie
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Aria Foods B&O Goodyear Saab Volvo
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by DFDS Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Food, Groceries Automotive Automotive Automotive Automotive
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COUNTRIES with OFFICES
Africa Asia
Bangladesh China Hong Kong Indonesia Korea Malaysia Phillipines Singapore Taiwan Thailand Vietnam
Countries served through owned offices or agents Australia / Pac.Isles
Australia
DFDS North America
Canada United States
Europe
Belgium Croatia Czech Republic Denmark Estonia Finland France Germany Greece Greenland Hungary Ireland Latvia Lithuania Netherlands Norway Poland Russia Serbia & Montenagro Slovakia Slovenia Sweden United Kingdom
South/Latin America
Brazil
EDITOR'S COMMENTS
DFDS Transport is primarily a non-asset operation. EBITS are 5%. About three-fourths of operations are European over-the-road. Solutions (logistics) have revenues of $150 million per year. The activities of DSV within transport and logistics continue under the name DFDS Transport. The DSV Group is Denmark’s largest and leading supplier of transport and logistics services. The Group originates in the Nordic countries but is established with own operations in 37 countries in Europe, North America and the Far East. Via professional and advantageous overall solutions a worldwide yearly turnover of 2.9 billion euro is realized by the Group’s 11,000 employees. Provider's Strengths Integrated solutions with strong transport and distribution operations including refrigerated. Provider's Weaknesses
CASES & NEWS
DFDS Transport (Hong Kong) Ltd. has acquired the activities of CDS-Frans Maas (Asia) Ltd. DFDS Transport (Hong Kong) Ltd. (part of the DSV Group) has acquired the activities of the former Frans Maas partner in Hong Kong CDS-Frans Maas (Asia) Ltd. CDS Frans Maas (Asia) Ltd. worked as the exclusive partner in Asia for the Frans Maas organization in Europe for both airfreight and ocean freight. The activities and staff of CDS-Frans Maas (Asia) Ltd. will be integrated into the current organization of DFDS Transport in Hong Kong. Guanghzhou (Southern China), Shanghai and Vietnam. With the acquisition we have maintained the local knowledge in Asia what relates to the Frans Maas, Europe/Asia activities and secured that customers will get continued stability in the handling of their cargo. DFDS Transport Asia A/S (DFDS Transport) has expanded with an additional country through establishment in Taiwan under the name DFDS Transport (Taiwan) Co. Ltd. July 4, 2006 DFDS Transport (part of the DSV Group) has established a new company in Taiwan with our former agent Mr. Tony Tsai as Managing Director. The distribution of share is now DFDS Transport 80% and Mr. Tony Tsai 20%, respectively. Thus DFDS Transport (Taiwan) Co. Ltd. has signed an agreement to acquire the activities of Trans Force Express Ltd. owned by Mr. Tony Tsai. The parties have agreed not to publish the acquisition price. DFDS Transport (Taiwan) Co. Ltd. has budgeted annual turnover of DKK 75 mil. in 2006, has 32 employees and office located in Taipei. By establishment of DFDS Transport (Taiwan) Co. Ltd. the coverage in Asia with offices in 11 countries and more than 750 employees has become even broader and thus complements the global network of DFDS Transport. DFDS Transport AS has acquired shares (100%) of Urmas Must Transport AS (UMT) [via website, October 10, 2005]
Urmas Must Transport AS (UMT) is an Estonian origin international haulage company, established in 1997, with yearly turnover EUR 3,7 mill. in 2004, and 25 employees.
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UMT main activities are full-load transports in the Baltic states, Scandinavia and Russia. 35% of their activities are temperature controlled (frigo) freights. UMT is located in Tartu in South Estonia and is well known brand in this part of the country. The aim of this acquisition is to strengthen DFDS Transport’s position in southern regions of Estonia and announce DFDS Transport AS to be a specialist of frigo transport services. The parties have agreed not to publish the acquisition price. DFDS Transport [via website, November, 23 2005]
DFDS Roland Munch A/S acquires Frigoscandia’s activities within domestic transport of cooled and refrigerated goods in Denmark. DFDS Roland Munch A/S takes over Frigoscandia’s activities within domestic transport of cooled and refrigerated goods as of 1 January 2006. Furthermore, 19 lorries with trailers are taken over concurrently with DFDS Roland Munch renting parts of Frigoscandia’s facilities in Horsens. All drivers are offered employment in DFDS Roland Munch, a subsidiary of DFDS Transport Group A/S. The new agreement results in DFDS Roland Munch A/S improving the company’s position among the largest suppliers of temperatureregulated transports in Denmark. The large volume will increase the efficiency of the logistics, and with DFDS Roland Munch’s routing system and trade solutions within this area, the company will be geared for continuing development and growth. DFDS Transport does it again [Eyefortransport, April 25, 2005}
DFDS Transport Air & Sea Holding A/S, part of the DSV Group, has entered into an agreement with Joachim Dohla concerning DFDS’s acquisition of the entire share capital of Haring Aircargo. With a turnover of approximately €14 million, Haring Aircargo is a well-respected enterprise placed in Hof with departments in Frankfurt, Dusseldorf, Stuttgard, Munich and Cologne. The enterprise deals primarily with airfreight and covers all the Southern German market. The take-over will secure the position of DFDS Transport’s Air & Sea division in the German market, which was previously covered via agents. The take-over is in line with the group’s strategy, and will strengthen the transports between Germany and Asia considerably. The parties have agreed not to disclose the acquisition price. DFDS buys twice more in Germany [Transport Intelligence, April 26, 2005]
DFDS Transport, part of the DSV Group, has continued its aggressive acquisition strategy by buying two more logistics companies. Whereas the thrust of its development to date has been in the road haulage industry, it has now turned its attention to the freight forwarding sector. Both companies which it has bought are highly active in the German market. The larger acquisition of the two involves a deal with South Africa based Imperial Logistics which has sold its German freight forwarding division Bachmann. The Bachmann Group of companies has an annual turnover of €160 million, with operating profit (EBIT) of approximately €4 million. Although largely German based, with revenues of €110m generated in this market, it has offices in 11 countries in total. It is a sizeable player in the trade between APAC (the Asia-Pacific region and significant volumes to and from the USA. Its main non-German locations include Australia, Brazil, Canada, Hong Kong, China, Indonesia, Thailand, Czech Republic, Hungary and Poland. The takeover of Bachmann is expected to take place with effect from 1 June 2005. Closing of the transaction is dependent on approval of the relevant authorities. Management of DFDS commented that it acquired Bachmann to strengthen its global Air & Sea activities generally, and in particular on the North America and Asia Pacific trade routes. Synergies are expected to be realized within a period of 3 years, after which the EBITA margin of Bachmann is expected to be in line with the average margin of the Air & Sea division of DFDS Transport. In a separate announcement DFDS also revealed the acquisition of Hdring Aircargo, a forwarder located in Hof with offices in Frankfurt, Düsseldorf, Stuttgart, Munich, and Cologne. The acquisition is less than a tenth the size of Bachmann with a turnover of approximately €14 million and employing 40 staff. DFDS has focused its attention recently on the German market, buying several road freight operators in the IDS/elix groupage networks. Its combined road and freight forwarding operations in Germany will now give the company considerable presence in a market which several other European logistics companies have found it difficult to penetrate. The integration of these companies will now be crucial to the success of the company. DFDS Transport acquires Elix/IDS [eyefortransport, January 11, 2005]
DFDS Transport Group has announced the acquisition of the activities of Elix/IDS from J Rudolph & Söhne GmbH Internationale Spedition. The takeover will take effect as at February 1st, 2005. However, completion of the acquisition is subject to approval by the local authorities. The acquired activities have a turnover of approximately €21 million, 88 staff members and are situated in Baunatal near Kassel. Elix/IDS is already a co-operative partner to DFDS Transport Group A/S on the Scandinavian as well as the UK and Irish markets. The acquisition is a strategically well-positioned business for DFDS, both internationally and nationally, and in compliance with DFDS Transport's strategy. After the merger, DFDS Transport Group GmbH (Germany) will have turnover of approximately €175-180 million and around 900 staff members.
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Company Name DHL - Global Logistics Address: Peter Merian-Strasse 88 CH-4002 Switzerland Phone Number: 41-61-274-7474 Email Address: Fax Number: 41-61-274-7475 Website Address: www.dhl.com
Subsidiaries or Related Companies Cappelletti Spa Asset Focus: A Higgs Exel Pharma Logisitcs Spa (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: DPWN Int'l Logistics Year Started in Logistics: 1815
OVERALL CAPABILITY
Overall Capability of Provider: Very good global LLP and SCM, largest 3PL. Strongest operations are in DHL (Danzas) Forwarding.
KEY PERSONNEL
John Allan Chris Fahy John Pattullo CEO, DHL COO, DHL Global Forwarding COO, Exel EMEA COO, Exel Americas, APAC Bruce Bruce Edwards
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 9,600 4,300 * 148,095 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol DPWN Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 100 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 3,000 Total Reefers: Total Flatbeds: Total Tankers: Total Other: 1,000 Total Transportation Assets: Total Tractors: 1,000 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 1,000 3,000 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 700 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Mostly Owned Warehouses/DC's: 50/50 37.7 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 2380000 Total Annual Airfreight Tonnes: 2380000
MARKETS
Aerospace Chemicals Furniture Industrial Technology Apparel/Garments Computers, Electronics HBA Office Equipment/Machines Utilities Appliances Consumer Goods Healthcare Oil & Energy
(For functional specializations, see "Customers" section.)
Automotive Entertainment Heavy Air Freight Plastics, Fibers Beverage Food, Groceries Heavy Equipment Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating: E (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System:
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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Other Systems Capabilities: Bar Coding Demand & Supply Forecasting
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: Over 150 locations worldwide Other Services: Bulk in U.K. only
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
3M AMP Amway AOL Time Warner Argos ASDA Baxter Healthcare Bayer Bell & Howell Berhaus Intl Fashion Grp Boots Brother GmbH Burberry Calvin Klein Cosmetics
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by DHL Location
St. Paul, MN Harrisburg, PA Japan OH Europe Europe Deerfield, IL Europe OH
Industry
Technology Computers, Electronics Consumer Goods Entertainment Retailing Retailing Healthcare Healthcare Industrial Apparel/Garments Retailing Computers, Electronics Retailing HBA
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Europe
Europe
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COUNTRIES with OFFICES
Africa
Algeria Algeria Angola Azores Bahrain Bangladesh Benin Botswana Burkina Faso Burundi Cameroon Canary Islands Cape Verde Chad Congo Cote d’Ivoire Cyprus Djibouti DR of Congo Egypt Ethiopia Gabon Gambia Ghana Guinea India Israel Jordan Kenya Kuwait Lebanon Lesotho Madagascar Malawi Mali Mauritania Mauritius Morocco Morocco Mozambique Nigeria Oman Pakistan Qatar Reunion Island Rwanda Rwanda Saudi Arabia Senegal Seychelles Sierra Leone South Africa Swaziland Syria Tanzania Togo Tunisia Turkey Uganda United Arab Emirates Yemen Zambia Zimbabwe
Countries served through owned offices or agents Australia / Pac.Isles
American Samoa Australia Cook Islands Fiji Fiji French Polynesia Guam Kiribati N. Mariana Islands Nauru New Caledonia New Caledonia New Zealand Papua New Guinea Samoa Solomon Islands Tahiti Tonga Tuvalu Vanuatu
DHL North America
Canada United States
Asia
Bangladesh Brunei Cambodia China Hong Kong India Indonesia Iran Israel Japan Jordan Korea Kuwait Laos Macao Malaysia Maldives Myanmar Nepal Pakistan Philippines Rep. Of Korea Singapore Sri Lanka Taiwan Thailand Turkey Vietnam
Europe
Albania Andorra Armenia Austria Azerbaijan Bahrain Belarus Belgium Benin Berlize Bulgaira Croatia Czech Republic Denmark Estonia Finland France Georgia Germany Gibraltar Great Britain Greece Hungary Iceland Italy Kazakhstan Kyrgystan Latvia Liechtenstein Lithuania Luxembourg Macedonia Malta Moldova Monaco Netherlands Norway Poland Portugal Romania Russia San Marino Slovak Republic Slovakia Spain Sweden Switzerland Tajikistan Turkmenistan Ukraine United Kingdom Uzbekistan Vatican City
South/Latin America
Argentina Belize Costa Rica El Salvador Nicaragua Panama French Guiana Guyana Paraguay Peru Suriname Uruguay Anguilla Antigua & Barbuda Aruba Bahamas Barbados Bermuda British Virgin Islands Caicos Island Cayman Islands Dominica Dominican Republic Grenada Guadeloupe Haiti Jamaica Martinique Netherlands Antilles Puerto Rico St. Kitts & Nevis Trinidad & Tobago US Virgin Islands St. Vincent & Grenadine St. Lucia Venezuela Brazil Ecuador Mexico Chile Colombia Bolivia Cuba Honduras
EDITOR'S COMMENTS
DHL Express will continue to struggle in North America. However, DHL Global Forwarding is operating well and has finally gotten the Danzas and AEI purchases integrated and running smoothly. Danzas had been the global brand leader in forwarding for most markets, including Asia. The Exel operations should be largely absorbed by year-end. Deutsche Post expects to save about $300 million in synergies. DHL Global Forwarding should continue to be an industry leader with very good operations. Combined ocean operations should exceed $1.8 million TEUs this year. Provider's Strengths
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The world’s largest general purpose 3PL with a host of solid operations; global reach for contract logistics and transportation management. Provider's Weaknesses
CASES & NEWS
DHL Exel Signs Deal With EMI France [Transport Intelligence, June 14, 2006] DHL Exel Supply Chain has won a five year deal to manage the distribution of EMI Music France’s CDs, DVDs and Point of Sale advertising materials. The contract will involve more than 30 million albums a year. Production and packaging of CDs and DVDs for the European market is centralized in Uden, in the Netherlands where DHL Exel has taken over EMI’s logistics processes, which until now were managed by another provider at the site in Saint-Ouen-L’Aumone. It has integrated all 52 employees. Once the products have been delivered to the 8,500 sqm warehouse, DHL Exel Supply Chain undertakes unloading, checking, stocking and order preparation. On average, 6600 CD references and 300,000 orders (equivalent to 30 million items) are handled each year, and in order to guarantee the five to ten record launches a week, 120,000 items are prepared on average every day. To maintain this output, DHL Exel Supply Chain uses a semi-automated production line that can achieve a rate of 500,000 items and 30,000 order lines a day. Each order is automatically weighed on the production line. An additional 35% of orders – chosen at random – are also checked manually, to guarantee reliability. DHL Exel Supply Chain also carries out promotional packaging and value-added logistics services for EMI such as special and regular packaging, labeling the CDs, DVDs and boxes when they are delivered with an embargo date, as well as preparing the displays (assembled or not). DHL also manages all returns to Saint-Ouen-L’Aumone. Start of New Era as Exel Sale Completed [Transport Intelligence, December 14, 2005]
Deutsche Post has announced that its acquisition of Exel has now been completed with the transfer of 100% of the UK logistics company’s equity capital to the German mail, express and logistics giant. The transaction values Exel at ₤3.8 billion with Deutsche Post paying 900 pence in cash and 0.25427 Deutsche Post shares per Exel share. The new Deutsche Post shares will start trading on the Frankfurt stock exchange December 14. Exel Chief Executive Officer John Allan will manage the combined division, which will be headquartered in Bracknell, near London and operate under the DHL brand using DHL’s red and yellow colors. Rebranding will start immediately and is likely to be completed by the end of 2006. After the merger, DHL will operate with two logistics sub-brands: DHL Exel Supply Chain and DHL Global Forwarding. Deutsche Post World Net has also already identified the second and third management levels of the new logistics division. DPWN believes it can realize gross cost synergies of €220 million per year by 2008. These synergies mainly relate to overhead cost (approximately 50% of total cost synergies) and productivity enhancements (around 30% of total cost synergies) and productivity enhancements (around 30% of total cost synergies). Over a period of 3 years total integration cost of about €400 million are planned, with almost half of the cost expected in 2006. DPWN’s management states that in 2006 integration cost will exceed the first year’s synergies by approximately €100 million. Excluding the integration cost the Exel transaction will be modestly earnings enhancing in 2006. In 2007 the transaction will be earnings enhancing also including integration cost. Exel will be included in the DPWN 2005 group accounts as per year-end. Unisys Selects DHL as Global Lead Provider for Customized Logistics Solutions PLANTATION, Fla.--(BUSINESS WIRE)--May 22, 2006--DHL, the worldwide leader in global express delivery and logistics, today announced it has been selected by Unisys Corporation as global lead logistics provider (LLP) for post-sales replacement and service of parts, or 'after-market' service logistics. The contract, with a term of up to 7 years, consolidates Unisys logistics service operations from more than 100 service providers to a comprehensive logistics solution through DHL. The implementation of the new service agreement began this spring. The agreement combines DHL's global service parts logistics and distribution network capabilities with Unisys worldwide technology services and solutions. DHL will streamline Unisys logistics processes by managing the inventory and distribution of high technology and electronics replacement parts, and by providing reverse logistics services for Unisys maintenance service customers from more than 270 DHL Strategic Parts Centers in 55 countries. DHL's transportation services for Unisys will include DHL's same day, Express, Ground and Freight services. Beginning in calendar year 2007, DHL will transition Unisys onto DHL's global service parts logistics technology platform. This new state-ofthe-art system was released last year to enable monitoring, management and inventory level reporting across regions, providing visibility into status of orders throughout the supply chain from multiple vendors. "With thousands of service requests per day from our clients around the world, it was imperative for Unisys to streamline our service logistics process through a reliable provider with a strong global network," said Tom Sunseri, vice president and general manager, Service Supply Chain Operations, Unisys. "This agreement builds on a relationship with DHL that has successfully supported our business model and growth over several years, and we look forward to extending the exemplary customer service and the flexibility and scalability of these services to a wider, global customer base." Unisys has historically provided a selection of support services options to its customers, such as mission-critical support, field service, maintenance, and repair -- with one of many third-party logistics providers around the world. With the new agreement, Unisys will have the ability to provide its full array of service options through DHL as its lead provider, matching the complex service requirements of each customer, and eliminating the need to assign service orders to third-party providers across multiple systems. "This agreement demonstrates a growing trend among manufacturers and technology service providers to outsource global logistics to a lead provider," said John Allan, CEO, DHL LOGISTICS division. "This relationship demonstrates how DHL leverages its global footprint and transportation network to serve one of the world's largest service parts operations to support their global reach with customized spare parts supply chain solutions designed with their needs and their customers' needs in mind." DHL has provided services for Unisys since 1997 and currently handles service parts logistics for Unisys in Australia, several countries in Europe, and in most of Latin America. The new contract will extend DHL services into Europe; North and South America; the Middle East and Africa; and the Asia Pacific region. The flexibility and scalability of DHL's comprehensive offering will help enable Unisys to simplify service to clients while moving into new markets quickly and reliably.
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D Post predicts more losses at US DHL unit
[by Richard Milne, The Financial Times Limited, March 15, 2006]
Deutsche Post, Europe’s largest postal group, yesterday forecast several years of continuing losses at its DHL parcels business in the US, causing it to issue conservative guidance for 2006 Klaus Zumwinkel, chief executive, said the US division would continue to lose money this year, when its losses would be similar to last year’s €400m ($481m), as well as in 2007, though they should be reduced next year. He refused to say when the division would break even after the group last month abandoned its target to do so by the end of this year. Concern over integration problems for DHL in the US, France and the UK led to a large sell-off in the shares, which ended down 7 per cent at € 21.16. The costs of further integration in the US and expenses of €280m in 2006 from its £3.8bn ($6.5bn) acquisition last year of Exel, UK logistics company, mean Deutsche Post is targeting an operating profit this year of at least €3.7bn, against 2005’s €3.76bn. In spite of the inclusion for the first time of Exel, which analysts estimated made €312m last year, the German group has to overcome not only increasingly competition in its home market before it’s monopoly ends in 2009 but also non-recurring gains from 2005 of about €400m. Mr. Zumwinkel justified the decision no longer to publish individual results for DHL’s US division by saying competitors were using the poor figures to steal business. “We won’t give any more forecasts so that we don’t do more damage to our business,” he said, before insisting. “We have nothing to hide. It was just we had to weigh up transparency against damage to the business.” A global logistics company had to be represented in the US, although he admitted Deutsche Post, with a market share of 7 per cent there, would never earn as good a margin as rivals such as FedEx and UPS. Analysts said Deutsche Post had at least two years of hard work to make its acquisitions pay off. Microsoft, DHL Join Forces to Bring Xbox360 from Factory Floor to Retailer’s Door [via website, January 25, 2006]
DHL and Microsoft Collaborate to Ensure Timely Deliveries of the Next-generation Video Game Console. The Xbox 360 launch, orchestrated by Microsoft Corporation (NYSE: MSFT) and its long-time logistics partner DHL, the world's leading global express delivery and logistics company, has proven to be a successful collaboration of these two market leaders as thousands of Xbox 360's have been distributed simultaneously in Europe and North America. For gamers, the holiday season marked the start of a long-awaited adventure. For those working behind the scenes, the historic November 22 U.S. Xbox 360 product launch and the December 2 European rollout culminated a year's worth of planning and execution dedicated to one objective: Moving Xbox 360's across three continents on time and on schedule. "Microsoft set specific deadlines and promised the world it would meet them. In so doing, Microsoft challenged DHL to think creatively, and to anticipate the unpredictable scenarios that often accompany a major product launch during peak season," said Jane Sabin-Pass, Global Customer Manager, DHL Global Customer Solutions. "The precise delivery schedules were a testament to the skill of both companies to link the global supply chain with flawless accuracy and transparency." The Xbox 360 project drew upon 15 years of collaboration between Microsoft and DHL, which included the highly successful rollout of the first Xbox console in November 2001. Knowledge of each other's systems and processes played a vital role in expediting Xbox 360 launch schedules, reducing implementation lead times, and meeting strict deadlines. Among the milestones of the Xbox 360 project: - Enhancement of a trans-Pacific rail-steamship service where ocean freight shipments entering the Port of Los Angeles from Hong Kong were met at the docks by dedicated trains that carried consoles and accessories directly to Microsoft's North American distribution center in Memphis, Tenn. The service shaved several days off of the standard transit times and ensured predictable and cost-effective deliveries to support the initial rollout and subsequent replenishment of inventory. - A unique aircraft loading solution for European air consignments enabling Microsoft to fully optimize the space aboard each aircraft without compromising the integrity of Xbox 360 units. Because the pallets' original height prevented them from fitting in the lower deck area of the aircraft, DHL Danzas Air & Ocean developed a program to "down-stack" each pallet at origin, load them securely into the aircraft belly for flight and then re-build the pallets into their original SKU configuration at destination. - The enhancement of DHL's sophisticated event management tool that seamlessly connected Microsoft with suppliers, contract manufacturers, carriers and even other transportation providers to deliver near real-time visibility of in-transit inventory. Launch planning began in November 2004 when both companies mapped out shipping strategies and laid the foundation for the robust I.T. network that would serve as the project's central nervous system. By August 2005, with the first of the Xbox 360s ready to ship, the project shifted into high gear. EDI messages from production sites in southern China enabled Microsoft and DHL to pro-actively update status information and maintain real-time visibility as Xbox 360's rolled off assembly lines onto barges bound for Hong Kong's Chek Lap Kok airport. As consoles and peripherals were loaded aboard charters, the DHL system automatically triggered "Advanced Ship Notices" to the U.S. and European distribution centers, providing the receiving points with the time to efficiently pre-plan their capacity needs. At each step in the process, DHL's automated systems validated all shipment load information, guaranteeing the appropriate volumes of Xbox 360 units were delivered to the proper destinations at the agreed-upon times. To ensure proper redundancy, DHL created back-ups of each message transmitted. Supporting the initial launch phase, DHL's regional team in Singapore led the implementation project deploying multiple Boeing 747 freighters procured by Microsoft to transport consoles from Hong Kong to the main distribution centers in Memphis and Dueren, Germany, 60 kilometers from Cologne. DHL staff in Hong Kong also arranged for commercial airlift to ship thousands of kilos of Xbox 360 peripheral equipment such as controllers, cables and other Xbox 360 accessories to North America and Europe. DHL in Seattle and Cologne performed custom clearance and synchronized deliveries with Microsoft's distributors to ensure sufficient high security trucks were positioned to deliver the consoles from the airport to Microsoft's distribution centers in Memphis and Dueren. DHL Cologne then organized truck deliveries from Microsoft's distribution center to retailers across the continent. The joint Xbox 360 effort is far from over. Charters continue to arrive in the U.S. and Europe. DHL has purchased significant ocean freight capacity to move consoles and peripherals long after the initial launch, and will continue to support the Microsoft roll out of Xbox 360s around the world. Microsoft and DHL are also now working jointly on implementing a new warehouse in Southern China to support
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fulfillment of Xbox 360 in Asia during 2006 and beyond. "What we learned from Xbox 360 is that an agile supply chain - one that employs a mix of transportation modes - is an effective solution to the challenges of executing a global product launch and on-going replenishment activities," said Bill Best, Senior Logistics Manager at Microsoft. "DHL's sophisticated I.T. tools will be leveraged in future projects to power Microsoft's supply chain and enhance its competitiveness. We see DHL's solution as an enabler of future success, and we envision a deep integration of DHL into our processes as a result," continued Best. "The Xbox 360 project is another step forward in our long and successful collaboration with Microsoft," said Eric S. Vargas, Head of Global Project Coordination & Program Management at DHL Global Customer Solutions. "Through the years, we've learned from each other, tested and challenged each other and, in the process, grown together. Microsoft has made DHL a stronger partner, and we are grateful to be able to leverage those qualities to bring a heightened customer experience to Microsoft and its customers and execute one of the most important product launches in its illustrious history." Service Excellence Brings DHL Multi Million₤ Logistics Contract London, October 28th 2005 - Plaster and plasterboard market leader, British Gypsum, has appointed logistics specialist, DHL Freight & Contract Logistics, to handle the £multi-million logistics contract for its site at East Leake in Leicestershire, with effect from December 2005. The award of the contract follows the recent announcement of major expansion at the East Leake site, already home to two of Europe's largest plasterboard lines, and is the culmination of an intensive 9 month review and tender process involving a number of the UK's leading logistics companies. British Gypsum operates five main UK manufacturing sites, and manages logistics for each under a separate contract. The latest appointment represents the second major logistics win for DHL, following their successful tender for the British Gypsum's world-leading Barrow-on-Soar plaster plant, in June 2004. British Gypsum Supply Chain Director, Craig Chambers, who managed the latest review, is delighted with DHL's appointment. "We had two primary objectives", he said, "to improve service levels to our customers, as part of our 'world class manufacturing' programme, and to service the growth in activity with the opening of our new East Leake plaster plant, due in late 2006. "DHL more than met all of our criteria. Their extensive national logistics network will ensure the rapid scalability needed to meet the increased demand, and they have already proved themselves through outstanding performance on the Barrow-on-Soar contract. On-time deliveries for this site have improved significantly, with over 98% now arriving within 30 minutes - a true 'world class' delivery service." East Leake is the largest of the company's five sites, responsible for manufacturing and stocking almost 700 individual plasterboard, plaster and accessory products. The DHL contract will involve the movement of more than 750 mixed loads a week to stockists and construction sites across the UK - with further increases due when the new plaster plant is commissioned. The contract will involve a core fleet of more than 50 DHL vehicles plus associated trailers, operated in British Gypsum's distinctive blue and grey livery, with back-up from DHL's contractor network providing the flexibility to meet demand surges and ensure high levels of service for British Gypsum's 3000 plus customers. Steve Allen, Managing Director of DHL Freight & Contract Logistics, is delighted to be awarded the new contract." I am pleased that with our extensive resource network and expertise, we have the ability to provide the tailor-made and flexible transport solutions that British Gypsum need to meet their logistics requirements. We are delighted to win this second piece of business with British Gypsum and we look forward to developing our relationship further in the future." Airbus uses DHL website for logistics management [via website, November 22, 2005]
DHL has developed a customized internet solution for Airbus in Germany for the management of the parcel transports of its far more than 4,000 suppliers. Starting now, the pick-up of up to 31.5 kilogram heavy items can be ordered via a special logistics portal. While the suppliers profit from the simplified shipment preparation, the aircraft builder receives a better overview of the incoming goods and its accounting procedures are lightened: Instead of several single invoices, now Airbus or its business divisions just receive one collective invoice with a proof of individual orders within a predetermined accounting period. DHL Express takes care of all logistics services in the meantime, from shipment preparation to pick-up from the sender all the way to delivery to the recipient. Particularly for medium-sized suppliers, the reduction of their administrative processes is today an economic advantage. With the online version of DHL’s familiar pick-up order service (Termin Auftrags Service – TAS), they will no longer need to fill out shipping labels and transport lists, and even the recipient addresses are preprinted on the online form. Another new feature is that an individual order is no longer necessary for each shipment, but rather the pick up of up to nine parcels ready for shipment can be advised in one operation. The DHL parcel carrier comes on the agreed day and brings the filled-out shipping labels along. Alternatively, customers can integrate the service into their own internet or internet platform. More than one million TAS pick-up orders were processed by DHL in Germany in the first half of 2005 alone. With TAS-Online, there is now an internet-based solution available that can be customized to the individual requirements of major customers and their suppliers. In this regard, DHL Express is currently involved in discussions with further renowned customers.
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Company Name Dimerco Express Group Address: 11/12F No. 160, Min guan East Road, Sec. 6, Taipei, Taiwan R.O.C. Phone Number: 886-2-27963660 Email Address:
[email protected] Fax Number: 866-2-27907122 Website Address: www.dimerco.com
Subsidiaries or Related Companies Diversified Freight System Corp. Asset Focus: N Diversified International Transportation Co. Ltd P.T. Uniair Indotama Cargo Worldwide Forwarding Network Pty Ltd. (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1971 Market Area: Founding Business: Int'l Freight Forwarding
OVERALL CAPABILITY
Overall Capability of Provider: Capable Chinese 3PL and freight forwarder
KEY PERSONNEL
Paul Chien Edward Lin Roger Wong CEO E.VP Director Jack Ruan John Chu Controller Chief Officer SCM
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 338 338 * 1,700 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol 5609 Exchange: Taiwan
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 100 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: 512 Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 36 10 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 8 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 0.3 (Million) 11
Asset Ownership v.s. Leased: Transportation Equipment: Leased Warehouses/DC's: Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 20000 Total Annual Airfreight Tonnes: 86000
MARKETS
Computers, Electronics Telecommunications
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): e-Chain System Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition e-Chain System e-Chain System EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling e-Chain System
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Foxconn Huawei ITG Lite-on-IT Logitech Nortel S&S Creation Samsung Sony
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Dimerco Location
SIN HK, SIN SIN LAX, SFO BJS HK, TWN LAX HK SFO
Industry
Computers, Electronics Telecommunications Computers, Electronics Computers, Electronics Computers, Electronics Telecommunications Computers, Electronics Computers, Electronics Computers, Electronics
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
China Hong Kong Indonesia Malaysia Singapore South Korea Taiwan Thailand Vietnam
Countries served through owned offices or agents Australia / Pac.Isles
Australia
Dimerco North America
Canada United States
Europe
Ireland Netherlands United Kingdom
South/Latin America
EDITOR'S COMMENTS
Dimerco is a successful Chinese freight forwarder emphasizing Asia-U.S. lanes. Gross revenues are $338 million on a mix of airfreight, ocean freight, warehousing and 3PL activity. Net income runs $5 million. Sister company, Diversified Transportation has trucking operations in China and Taiwan. Dimerco’s emphasis is on hightech and telecommunications. Provider's Strengths Already set up in China - UniGroup strategic alliance. Provider's Weaknesses
CASES & NEWS
2006 to Present: Dimerco Zhongjing International Express Co. Ltd. was granted China Domestic Airfreight Operating License in May of 2005 and Diversified Transportation (China) Co. Ltd. was granted Road Transportation Service License in December of 2005. 2005: In 2004, Dimerco Zhongjing International Express (DIMZJD) was awarded the honor certification from China International Freight Forwarders Association (CIFA) and International Federation of Freight Forwarders Associations (FIATA). DIMZJD is ranked 30th of China Top100 freight forwarder in overall Chinese industry. By airfreight forwarding, ZJD is the 35th out of "2004 China top 50". By ocean freight forwarding, ZJD is the 21st out of "2004 China top 50". 2004: According to the statistics generated by Business Weekly Magazine (in Taiwan), Dimerco Express Corporation has been ranked 569th out of the top 1000 companies, which include all industries from China, Hong Kong, and Taiwan. If ranked by Industry, Dimerco is the 25th out of the top 35 Logistics/Transportation Service companies over these three regions. 2004: Dimerco Beijing office has been awarded the No. 2 International Cargo Sales Agent of Air China by 2003. 2003: Dimerco is a certified member of the C-TPAT (Customs Trade Partnership Against Terrorism). 2003: In 2003, Dimerco Zhongjing International Express (DIMZJD) was awarded honor certification from Beijing Finance Bureau due to our excellent performance for China finance settlement by the year of 2002. 2003: To respond U.S. Customs issued Rules requiring ocean carriers and/or NVOCC's to submit a cargo declaration 24 hours before cargo is laden aboard the vessel at a foreign port, Dimerco is certificated to transmit the corresponding required cargo manifest information directly to the US Customs electronically through the Automated Manifest System (AMS), 24 hours before the vessel arrives in the port of departure. 2002: Dimerco has an established network of more than 100 service locations worldwide. This includes our own branch offices, Joint Ventures, and partner agents covering the Greater China & South East Asia, North America, Europe, and Australia. 2001: Became the first and only freight forwarder and logistics service provider publicly listed in TASDAO (Taiwan OTC market) on 15th Oct. 2000: Implemented our Dimerco e-Chain System integrated with air/ocean freight, Warehousing/Logistics and Financial/ Accounting management. This advanced new system gave us the capability to exchange data electronically (EDI, XML, FLAT FILE) with major customers for greater supply chain visibility. 1999: Established a Centralized Settlement Program to streamline efficient account settlements among JV, agents, and Dimerco stations 1999: In 1999, Dimerco is awarded the No.3 Logo Design in the transportation group from the Intellectual Property Office (TIPO), the Ministry of Economic Affairs, Republic of China 1997: Awarded as one of eight excellent customs brokers by Taiwan's Customs 1996: To provide better services to our customers, Dimerco established a joint venture company with Beijing Jin Mao Passenger & Cargo Service, named Dimerco Zhongjing International Express in 1996 and continues to expand both locations and services in this fast-growing market.
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1995: Awarded the ISO 9002 certification in Taiwan (London: 1994, Singapore: 1995, Canada: 1997, United States: 1997, Jakarta: 1997, Hong Kong: 1999) 1992: Completed EDI connection with Taiwan's Customs in November as one of the pioneers to provide an electronic customs clearance service 1989: Implemented airfreight system called "DIM" (Dimerco Information Management) System consisting of Import & Export operation modules integrated with "AccountMate's A/R modules", a 3rd party's accounting system. 1975: Became a member of the International Air Transportation Association (I.A.T.A.) 1971: Established the first office in Taipei, Taiwan and extended overseas network in New York, Hong Kong, Los Angeles, Chicago, London, and Singapore
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Company Name Egerland Automobillogistik GmbH & Co. KG Address: Narupstr. 21, D-49084 Osnabrück Germany Phone Number: 49-5-41-56-05-0 Email Address:
[email protected] Fax Number: 49-5 41 56 05-2 22 Website Address: www.egerland.de
Subsidiaries or Related Companies Egerland France SarL Asset Focus: A Egerland Car Terminal Gmbh & Co. KG Recontec Gmbh Egerland Lease (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1949 Market Area: Founding Business: Europe Automotive transport
OVERALL CAPABILITY
Overall Capability of Provider: Capable auto logistics.
KEY PERSONNEL
Kay Hanns Ewaldsen Friedhelm Rolf Dirk Freese Chairman CFO Operations Reinhard Pieck Dieter Schleyer Tech. Serv. Bus. Dev.
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 80 80 * 568 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 250 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 9 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Mostly Owned Warehouses/DC's: Mostly Owned 3.7 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): FLAIS Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling FLAIS
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials Other Services:
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: DIN EN ISO 9001
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Audi BMW General Motors Honda Jaguar Mazda Mitsubishi Nissan Porsche Saab Toyota Volkswagen Volvo
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Egerland Location
Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe
Industry
Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Austria Belgium Czech Republic France Germany Luxembourg Netherlands Poland Spain UK
Egerland North America South/Latin America
EDITOR'S COMMENTS
Provides complete auto finishing and delivery service. Provider's Strengths Automotive logistics and transport. Provider's Weaknesses Size and geographical scope.
CASES & NEWS
Recontec By 17.12.2003 Werner Egerland Automobillogistik GmbH & Co. KG took part with 50% in the Recontec GmbH, Duren. Egerland is well known as a service provider for the transport and technical services for vehicles, with service centres in Osnabruck, Bremen and Neuseddin close to Berlin. Recontec is a leading company in the refurbishment and preparation for re-selling of fleet and rental cars, with a technology centre in Duren. The participation bundles the specific competencies of both companies in order to improve their performance and the services for their clients. Agreement for technical co-operation {via website November, 2001}
In order to improve performance and efficiency towards the clients Werner Egerland Automobillogistiks GmbH & Co. KG, Osnabruck, and the French Societe de Transports de Vehicules Automobiles (STVA), Paris, likewise specialized in the field of automobile logistics, have signed an agreement for technical co-operations with Egerland France S.a.r.l. in Forbach and the STVA. Since 1998 Werner Egerland Automobillogistik GmhH & Co. KG is represented on the French market with its subsidiary Egerland France S.a.r.l. operating a service center as well as considerable cargo fleet. WERNER EGERLAND wins the European Car Carrier Award [via website 5/2001]
WERNER EGERLAND Automobillogistik GmbH & Co. KG has been honoured with the European Car Carrier Award 2000 (ECCA 2000). The DaimlerChrysler AG conferred this prize, which takes the shape of a glass pyramid, on the best carrier in the field of vehicle logistics for the first time. The company, which conducts business throughout Europe, surpassed 23 other major European carriers. For one year all competitors had to stand stiff examinations, with special attention being paid to the quality of new-car transports. Criteria such as loading safety, delivery periods, charges and the quality of the fleet of trucks appeared on the checklist alongside the drivers‘ kindness and competence as well as the condition of their transporters. According to testers‘ statement two criteria were decisive in awarding the prize to the Osnabrück company. The first is the so-called "closed concept", whereby new vehicles are delivered directly to the merchants‘ showrooms in dustproof and waterproof transporters, after having been fully prepared in an +egerland+ logistic centre. The second is the internet link within E-commerce, which enables DaimlerChrysler employees to order vehicles in the +egerland+ centres selectively.
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Company Name EGL Eagle Global Logistics Address: Intercontinental Airport, 15350 Vickery Drive, Houston, TX 77032 USA Phone Number: 800-888-4949 Email Address:
[email protected] Fax Number: 281-618-3100 Website Address: www.eaglegl.com
Subsidiaries or Related Companies Asset Focus: N, A
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1984 Market Area: Founding Business: Int'l Expedited, Time-definite (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Good domestic airfreight forwarding.
KEY PERSONNEL
James R. Crane E. Joseph Bento Ronald Ralley Chairman & CEO Pres. NA CMO COO Charles Leonard CFO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 3,096 948 * 10,500 > 1000 3-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol EAGL Exchange: NA
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 15 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 200 Total Reefers: Total Flatbeds: Total Tankers: Total Other: 150 Total Transportation Assets: Total Tractors: 50 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 1,500 600 7 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 87 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 15 (Million) 5 20
Asset Ownership v.s. Leased: Transportation Equipment: Mostly Leased Warehouses/DC's: About 50/50 Owned/Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes: 2435245
MARKETS
Aerospace Military, Government Retailing
(For functional specializations, see "Customers" section.)
Technology
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary Proprietary Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: all locations Other Services: Yard Management
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Continental Airlines Neiman Marcus Sharp U.S. Military Visteon
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by EGL Location
Houston, TX
Industry
Aerospace Retailing Technology Military, Government Misc.
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Miami, FL Europe
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COUNTRIES with OFFICES
Africa Asia
China Taiwan
Countries served through owned offices or agents Australia / Pac.Isles Europe
France Germany
EGL North America
United States
South/Latin America
EDITOR'S COMMENTS
Eagle’s 2005 was a year of major improvement. Its integration with Circle took years but is completed. Net revenues grew 10% and net income margin was 5.8%. Eagle has had major success as a logistics provider for U.S. Iraq operations using 40-ton Antonov aircraft. Airfreight forwarding is 66% of business and customs brokerage is 20%. Europe continues to be a challenge. Eagle reports 2.4 million total tonnes handled. Provider's Strengths Trucking, airfreight, U.S. domestic forwarding operations. Provider's Weaknesses Ongoing shakeout from Circle acquisition and maintaining profitability.
CASES & NEWS
Profits Soar at EGL [by John Boyd, Traffic World, March 20, 2006] Shippers concerned by major acquisitions shift freight to forwarder, sending net income up, Crane says Consolidation is creating opportunity for EGL Eagle Global Logistics as anxious shippers send business to the forwarder, pushing up profits and revenue. CEO James Crane told analysts in a March 9 conference call that shippers “are very jittery” following three major global acquisitions, and air freight shippers in particular are seeking bids from more players such as EGL. The Houston-based forwarder’s net income surged 48 percent to $19.1 million in the fourth quarter. Revenue increased 4 percent to a record $835 million from its air, ocean and truck freight forwarding operations, up from $800 million a year earlier. EGL’s revenue net of transportation costs rose 10 percent to $251.6 million. For 2005, EGL said its net rose 14 percent to $58.2 million, as revenue rose 13 percent to $3.1 billion. But while touting the results, Crane said EGL was seeing unusually strong freight bidding in 2006 stemming from forwarder consolidation. UPS acquired Menlo Worldwide Forwarding in 2004 and is preparing to activate a new heavy freight air network, while German railway firm Deutsche Bahn acquired BAX Global and Deutsche Post World Net acquired Exel. “Because of the turmoil” caused by those deals, shippers are reluctant to concentrate business in the hands of those companies, Crane said. As a result, in the normally slack months of January and February “there’s a lot of bid activity out there on the air side,” he said. EGL’s bids have “been inserted into some new deals,” Crane said, and “we think we’re going to close more business because of that activity” as the year goes on. He said EGL has long had a strong high-technology customer base, but with the forwarder market in flux, EGL is also seeing more bid opportunities from retailers, the oil and gas industry, the industrial sector and the automotive industry. He said EGL is also finding some seasoned employees at other forwarders are wiling to change companies because of new uncertainty at their old firms, and EGL picked up some veterans to strengthen its staff. As an example of how that helps, Crane said EGL dispatched a U.S.-based manager to oversee its high-cost European arm, an executive who “turned that around” to make it a profitable operation. But he said EGL was also adding some European managers as part of the fallout from acquisitions, and that would help EGL meet its goal of having European managers run operations in Europe. EGL isn’t alone. Other players in the forwarding and logistics field say they are benefiting from upper-tier consolidation. “This has probably been the most frenetic I’ve seen this industry in at least five years,” said Rick Campbell, CEO of Icat Logistics. Campbell is banking on industry turmoil from consolidations to drive business to smaller players such as Icat. “We refuse to take a catching position” when it comes to business opportunity, he said, “We take a pitching position.” There’s enough business out there for EGL and others to be picky. Crane said EGL in the past year purposely “walked away” from some business that did not yield enough, especially for accounts in which “the price was set at a point where there wasn’t very much left” after covering costs. While EGL plans to hold to that strategy of turning aside business in which customers demand too low a price, he said, “I think a lot of that business will come back” given the market trends. EGL will negotiate some on pricing for its services, Crane said, but not on the fuel and security costs for which handlers build surcharges into contracts. “We’re not going to get into a negotiating game” on fuel and security expenses, he said. “We’re going to pass it through.” EGL Eagle Global Logistics to Manage Supplier Logistics Center at New Dell Facility ROUND ROCK, Texas, Nov. 1, 2005 Dell has selected EGL Eagle Global Logistics to manage the supplier logistics center and fleet services at its new manufacturing facility in Winston-Salem, N.C. The Houston-based company will occupy 175,000 square feet of warehouse space inside Dell’s largest manufacturing facility and will support Dell’s material supply-to-order model, overseeing inventory of internal components used in the computer assembly process. Our partnership with EGL Eagle Global Logistics led to an innovative approach for inventory and supply chain management in our new North Carolina manufacturing facility,” said Dick Hunter, vice president of Dell Americas manufacturing and distribution operations. “EGL has worked closely with us to further refine our processes and productivity improvements. Currently, EGL has placed 20 employees in its Winston-Salem operation and anticipates at least 30 by the end of 2006. Positions include logistics center supervisors, customer service account managers, information-technology support technicians, drivers, dispatchers, clerks and
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material handlers. Interested individuals can access information via the EGL Web site at www.eaglegl.com. We are pleased to have the opportunity to become a strategic partner with Dell by assisting in managing their supply chain throughout North America and the world,” said Joe Bento, president and chief marketing officer for EGL. “We are excited to support Dell in managing one of the highest velocity and most efficient supply chains in the world.” EGL manages vendors for Dell in the IT supplier’s North American manufacturing facilities. In North Carolina, EGL provides internal components for the supplier logistics center. EGL’s Rebuilding Effort [Traffic World, October 10, 2005, pg. 29]
Forwarder recovers from hurricanes, foresees new attention to domestic ground, Europe growth EGL Eagle Global Logistics weathered several storms in recent years and the Houston-based forwarder is hoping its rapid recovery from back-to-back hurricanes helps it grow stronger. Relatively unscathed by Hurricanes Rita and Katrina, EGL now is looking to tap into Gulf coast rebuilding efforts and begin expanding its operations after a year of consolidation. Its station at New Orleans Louis Armstrong International Airport was up and running after the storm and served as a makeshift headquarters for the 82nd Airborne, said EGL CEO Jim Crane. Katrina actually generated extra business for the forwarder as it trucked cargo from the hard hit area to Houston, Crane said. Now EGL is bidding to run “a distribution center to feed product into New Orleans.” The New Orleans station is small with a staff of 35, Crane said, “but it could get bigger as they start to rebuild.” For EGL, that’s a sharp contrast with the company’s recent efforts to pare down and gain greater control over its worldwide operations. In the first two quarters of the year, EGL made “minor adjustments … at all of our facilities,” eliminating about 350 positions at sites generating losses and two facilities – one in the United States and the other in the United Kingdom. “We are watching our staff count very closely through the end of this year,” Crane said in an interview, but he does not expect to cut more people “unless the economy tanks.” EGL’s consolidation comes after boosting revenue 28 percent and doubling its profit in the boom year of 2004. However, by the fourth quarter, profit growth was already slackening and EGL started the year with profit edging up only 2 percent in the first quarter. “We came off of a pretty big, robust year and the business has stabilized a little bit,” Crane said. For EGL, only in recent years a forwarder on the global stage, the stabilization has included rethinking its traditional lines of business. Domestic overnight service is declining “because of the globalization … of the business supply chain,” Crane said. “I don’t see that (business) heating back up unless the economy gets red hot and inventories get short.” But EGL’s lower cost ground service “continues to grow at 20 percent.” Rising fuel costs and competitive pricing also provide challenges. EGL took “a strong position” this year on passing through fuel surcharge costs after seeing its profits eroded by unredeemed surcharges last year. “A lot of the customers … liked to negotiate a percentage of the surcharge … (but) we can’t absorb any of that in our contracts,” Crane said. “We are firming up our pricing of the business,” he said. “In the business that doesn’t provide the right yields, we are going to ask for a raise or purge the business.” International business “is pretty good but the volumes aren’t what they were last year … (and) we haven’t seen as robust a peak season,” he said. In Asia, “we are still seeing good growth particularly in China and India.” In Europe, however, the company is struggling to reverse last year’s $2.3 million loss. “We feel we will be profitable by the end of the year.” Crane said. The company consolidated facilities in bigger markets, such as the United Kingdom and Germany, and adjusted head counts at the sites to match production and put in additional management controls, Crane said. “In Europe, the company is not for sale,” Crane said. “We are positioned to be a player in the industry and grow the business over the long term,” Crane said. It is a “high cost market” with long entrenched challengers. “Most of our business is tied back to our big account base in the U.S., so we do okay.” but “we have to focus on … doing more business with European players,” he said. The company is also recruiting European employees to its workforce. That, along with a plan to buy back almost 10 million shares of its own stock, has generated praise on Wall Street. “We are encouraged with management’s attention to the operational issues,” said Jon A. Langenfeld, an analyst with Robert W. Baird. However, “management must (still) show it can execute amid the current challenging environment.” To help this, EGL is seeking a chief operating officer, which is “a position that should result in more focus on cost management and business practices.” EGL Appeals Suspension [by John Boyd, Traffic World, March 27, 2006, pg. 36]
Forwarder says talks with U.S. Army aimed at resolving federal contract suspension The United States suspended EGL Eagle Global Logistics from eligibility for new government contracts in the wake of an overcharge conviction of a former employee, a potentially sharp blow to a forwarder with a long history of government shipping work. A corporate official said EGL was in talks with the U.S. Army to quickly lift a suspension that the company says took it by surprise. The suspension applies not just to the military but any federal agency. Dana Carabin, EGL’s general counsel, said the Army named the company as an unapproved contractor in a Web posting Feb. 27, as a procedural action after former EGL Regional Vice President Christopher Cahill pleaded guilty Feb. 16 to fraud related to military cargo shipments to Iraq in 2003. She said she first became aware of the suspension March 7 when a customer notified EGL, and later that same day EGL received official notice by certified mail of the Army’s action. Other federal Web sites have since spread word of EGL's suspension. The State Department’s Directorate of Defense Trade Controls this month posted a message reporting the Army’s suspension of EGL from future contracting. It said any contract applications submitted to DDTC after March 10 “where EGL is a party to the transaction, will not be approved other than on an exceptional basis.” Carabin said she met with Army officials in Washington March 20 to discuss EGL’s efforts to resolve issues stemming from the case. She said Army representatives “said they are drafting an agreement for our review that would result in our suspension being lifted.”
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The two sides traded drafts of the document, and Carabin said she was waiting for the government to say if they had a deal in hand. She said if EGL found the document agreeable and signed, she understood that the Army would immediately lift the suspension. In the fraud case, authorities said Cahill inflated freight bills with $1.14 million in unapproved war risk surcharges, when EGL was handling military shipments bound for Iraq under Contract to Halliburton subsidiary Kellogg, Brown and Root. EGL had said it fired Cahill and another employee in connection with those events, and was working with the government to refund the overcharges as well as pay penalties. In a Dec. 12 filing with the Securities and Exchange Commission, the company said the U.S. attorney in the case offered to settle the issue for repayment of the improper war risk surcharge billings plus $2.86 million in penalties. In return, the filing said, the U.S. attorney’s office would agree “to waive all investigatory expenses and will make no recommendation to the [Department of Defense} for debarment of EGL from future DOD contracts,” and would not recommend criminal indictment of the company. Carabin said EGL has been trying to pay the sums involved but such payments ran into government procedural roadblocks. Then came the Cahill guilt plea, followed soon by the suspension. When the company reported its fourth-quarter earnings March 9 its officials did not mention the suspension from government contracts, and Carabin said no one asked about it in a conference call that day with stock analysts. One questioner asked about the KBR-related overcharge penalty, which was cited among quarterly expenses. CEO Jim Crane described how the government calculated the penalties, and said, “We hope to have all that resolved and finished, and make some announcements in the near future.” He also said, “We’ve cooperated on any investigation,” but did not refer to a suspension. “We’re very disappointed it happened; we don’t expect anything like that to happen again.” A week later, in its quarterly 10K report to the SEC, it said the Army had notified EGL that “we were temporarily suspended” from government contract work effective Feb. 27. EGL Cuts Workforce [by Ed McKenna, Traffic World, June 27, 2005, pg. 29]
Layoff will total 350, two stations to close, forwarder says Europe business is faltering EGL, Eagle Global Logistics will layoff some 350 workers and may close two stations in an effort to cut costs in the face of slipping profits and struggling European operations. The actions come after Houston-based EGL, which had recovered its financial footing after the difficult integration of Circle International, saw profits fall 2 percent in the first quarter after more than doubling in 2004. EGL blamed the poor showing on a declining air freight volume growth, higher fuel prices and operating losses in Europe. EGL is looking to slim down its operation by reducing the number of employees in under-performing units. EGL Chief Financial Officer Elijio Serano said it will eliminate the jobs across international operations and possibly two stations, including its Washington office and possibly a European site. For EGL, these are the first major job cuts since 2001 shortly after the company leaped into the international arena by acquiring Circle. While integrating the workforces from the two companies, the forwarder cut about 980 full time and contract employees. The cuts this time are not expected to be as deep. “This is not a restructuring; there is no rightsizing of the company underway,” said Serrano. The actions are not “being taken as the result of … lost contracts or anything like that.” Instead, EGL “initiated a thorough review of all of our business units” after reporting weaker than expected results in the fourth quarter 2004, he said. Although profits grew 45 percent from the fourth quarter 2003, the results were 36 percent below the third quarter totals. “ Those locations that are not performing well are being … asked to adjust their staffing levels as appropriate,” Serrano said. “At the same time other sites are continuing to expand … and add people.” The company will probably cut about 300 employees out of full-time and part-time population of 12,000, Serrano said. The jobs lost could include executives and administrative staff, he said. The reductions are “necessary to address slower growth and instill accountability into the organization,” said Jon Langenfeld of Robert W. Baird Research. Like many forwarders, EGL is coping with a shift of air shipping to ground but the company still is cutting back in what looks to be a growing business. The company counted $444.6 million in air freight in the first quarter, up 16.4 percent from the same period last year but off the 27.6 percent growth of 2004. Expeditors International of Washington, which operates in similar markets, also saw growth rates slow down but its gross revenue of $825.1 million in the first quarter still was 20 percent ahead of the same quarter and the bottom line of $37.7 million marked a 19 percent improvement. EGL has extensive domestic operations, however, and “in North America, the majority of our product for the last three years has been moving on the ground, “Serrano said. A steep falloff in Europe is a more immediate concern. Those operations were “a significant drag” on earnings during the last quarter, said Langenfeld. The company’s Europe, Middle East and Africa division lost $2.3 million before taxes in the first quarter after posting a $2.3 million profit in the same period last year. “Without a doubt, our performance in Europe … (is) operating significantly below expectations,” said Serrano. Freight volume was up in the region but so were fuel prices and “we were slow to properly implement a pass through of all the fuel surcharges,” he said. Also, costs for European operations are “ramping up a bit faster than their revenue,” he said. EGL’s Walk-Away Plan [by Ed McKenna, Traffic World, March 14, 2005, pg. 29]
Forwarder pledges aggressive plan on surcharges, sees profits more than double to five-year high EGL Eagle Logistics, which saw surcharges pull back profit growth in the fourth quarter, says it will turn away business from shippers who won’t pay add-on charges for fuel and security. The Houston-based forwarder promised the aggressive action after more than doubling its net profit in 2004 to $51 million, nearly returning to levels it last saw in 1999 before EGL bought Circle International. But profits fell 36 percent in the fourth quarter compared to the third quarter, however, despite an 11 percent advance in revenue from the third quarter to the fourth. The profit decline was spurred partly by a capacity squeeze and a shift away from high-yield express services, but a
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spike in security and fuel surcharges added costs that the company found difficult to pass along to customers. The financial impact of the fuel surcharges “was four times greater than last year,” said Joe Bento, EGL’s president and chief marketing officer. Some customers, said Bento, were “good at dodging the phone calls.” The company is now working aggressively to enforce the added charges. “We will walk away from customers” that refuse, said CEO James Crane. “EGL is not alone in this effort, he said, adding many competitors are “pressing for cost increases.” Jon A. Langenfeld, a financial analyst with Robert W. Baird, said larger market trends will help EGL pass along the surcharges. “The majority of the leading forwarders are pushing for rate increases and as shippers continue to become more accustomed to pricing increases,” he said. The bad news late in the year on surcharges marred a report that showed EGL had just about dug out of the hole it fell into when it sped up its global expansion with its acquisition of Circle International five years ago. The company finished the year with revenue up 31 percent to $802 million and net profit up 45% to $13 million in the fourth quarter over the same period the year before. Air forwarding revenue climbed 33 percent, mostly from international operations, especially in Asia, while ocean was up 31 percent, said Crane. The fourth quarter earnings pushed the forwarders’ gross revenue up 28 percent over 2003 to $2.7 billion and the net profit of $51 million was up 113 percent over 2003. The growth came even as EGL’s market moved away from the higher-margin offerings. Next flight available and express service were off 2 percent in the quarter while second-day service was up 32 percent and third- and fifth-day offerings were both up 2 percent. Crane said express business may grow 2 to 3 percent in 2005. However, the days of strong growth in “that product are not coming back any time soon,” he said. Crane predicted overall 15 to 20 percent growth in 2005. The first quarter got off to a “weak or medium” start in January, but picked up steam in February, he said. And he said the ongoing consolidation of Menlo Forwarding into UPS and the closing of Menlo’s Dayton, Ohio, hub should help drum up additional business and bring some experienced Menlo workers into the job market. Crane also said EGL could expand its worldwide operations by six to eight new stations this year, including new branches in China and Eastern Europe and new in Latin America. EGL sees boom in air and sea freight revenues [Transport Intelligence, 11/4/2004]
US forwarder EGL has increased its gross revenues in the third quarter of 2004 by 35% to $720 million. The overall increase has been driven by a 36% increase in airfreight revenues, a 46% increase in ocean revenues, and a 23% increase in customs brokerage and logistics. Gross revenues outside North America increased 51% on the continued strength of volumes in Asia and the Middle East. The growth of the North America domestic product revenues of 15% was an increase from the Q2 2004 results, which showed an 8% increase over the same period of the prior year. Third quarter 2004 net revenues of $226 million increased 23% over last year. Net revenue margins of 31.4% were 300 bps lower than the third quarter of 2003. This reflects an acceleration of growth in international air and ocean products which carry a lower net revenue margin but a higher net revenue per shipment, pass-through of higher fuel and security surcharges without corresponding net revenue margin and higher transportation costs due to capacity constraints, mainly from Asia. Operating income for the third quarter of 2004 was $25.4 million, an increase of $14.1 million from the third quarter of 2003. Operating income as a percent of net revenues for the quarter increased 510 bps to 11.3% compared to last year.
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Company Name Emons Spedition GmbH Address: Poll-Vingster Strasse 107a, Koln, Germany 51105 Phone Number: 49 221 983 51-0 Email Address:
[email protected] Fax Number: 49 221 83 29 90 Website Address: www.emons.de
Subsidiaries or Related Companies Asset Focus: (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1928 Market Area: Founding Business: Europe
OVERALL CAPABILITY
Overall Capability of Provider: Good expedited, automotive 3PL.
KEY PERSONNEL
Herbert Putzmann Jo M. Standfuss Managing Director Int'l Traffic Director
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 217 217 * 1,300 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 100 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 1,000 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 17 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Owned Warehouses/DC's: Owned 0.4 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
BMW Volkswagen
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Emons Location
Germany Germany
Industry
Automotive Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Germany Hungary Italy Poland Switzerland Ukraine
Emons North America South/Latin America
EDITOR'S COMMENTS
Emons provides express transportation including time deliveries, warehousing and some freight consolidation. Provider's Strengths Automotive logistics. Provider's Weaknesses Niche and geographical limits.
CASES & NEWS
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Company Name Ewals Cargo Care B.V. Address: Ariensstraat 61-63, 5931 HM Tegelen, The Netherlands Phone Number: 0031-77-3202202 Email Address:
[email protected] Fax Number: 0031-77-3202222 Website Address: www.ewals.com
Subsidiaries or Related Companies Asset Focus: A
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1906 Market Area: Founding Business: Int'l (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Good multi-dimensional transportation and contract logistics.
KEY PERSONNEL
R. Roex C. Peters R. Sohl CEO Logistics CIO W. Tosserams CFO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 380 380 * 1,460 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 220 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 3,200 Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 830 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 220 4,750 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 18 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Leased Warehouses/DC's: Leased 3.8 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Industrial Plastics, Fibers
(For functional specializations, see "Customers" section.)
Retailing
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): ICARE Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition TM Suite by Manugistics PkMS by Manhattan Quintiq Networks ICARE ICARE EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials Other Services:
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: BE, CZ, DE, NL, SW, UK
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Borealis Ford Motor General Motors Goodyear IKEA Johnson Controls Michelin Nissan Saab Tenneco Packaging Volvo
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Ewals Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Plastics, Fibers Automotive Automotive Automotive Retailing Automotive Automotive Automotive Automotive Industrial Automotive
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
Belgium Czech Republic Finland France Germany Italy Lithuania Poland Slovakia Sweden The Netherlands United Kingdom
Ewals North America South/Latin America
EDITOR'S COMMENTS
Ewals started as an automotive transporter and added contract logistics. It provides integrated services (valueadded transportation, cross docking and storage) on a regular basis. Provider's Strengths Integrated automtive logistics. Provider's Weaknesses
CASES & NEWS
Ewals Cargo Care continues Acumen activities As from April 5th 2004 the activities, carried out by Acumen Distribution Services Ltd. until now, are going to be continued by Ewals Cargo Care. This change is a result of the decision of the parent company of Acumen, the British Autologistics Holding, to reduce the activities from Acumen as from that date. To ensure the continuation of the activities, a number of the Acumen employees are going to be employed by Ewals Cargo Care. In total it involves 49 employees divided over three offices in Belgium, France and the United Kingdom. Furthermore the trailers from the Acumen fleet will be integrated into the current fleet of Ewals Cargo Care. As a result the Ewals Cargo Care fleet grows from 3500 to 4300 units. 3000 of these units are MEGA trailers, which is further strengthening the position of Ewals Cargo Care as the leading MEGA-operator in Europe. In the first phase the activities of Acumen, which mainly focus on automotive transports from and to the United Kingdom, continue as a separate division within Ewals Cargo Care. In the next phase, the activities are going to be integrated with the current traffic-lines of Ewals Cargo Care. This amalgamation fits in with the strategy of Ewals Cargo Care to have a leading position within the European Automotive transport market, where it already has a well-established reputation. This expansion of business is complementary to the current activities of Ewals Cargo Care. Ewals Cargo Care is active as logistic service provider for several industries. Because of the further integration of the cross channel traffic, Ewals Cargo Care is able to strengthen its position within the cross channel market. Integrated Logistics in the high-tech industry The problem One of our clients in the high-tech industry challenged us to provide an outsourcing solution for one of its four product types. As a result, the client would be able to concentrate primarily on its core business: the manufacturing process. Our solution After an analysis of the logistical process we decided for a supply chain solution. Since our client uses the 'make-to-order' principle, sales orders are the starting point in this particular supply chain process. The sales order initiates a procurement of modules from strategic suppliers. About 100 strategic suppliers prepare the various modules, whereupon Ewals Cargo Care takes care of the collection and the shipping to the distribution centre. After a visual check, modules are repacked and shipped to one of the three production plants. After assembly, the final products are distributed to customers all over Europe, the United States and Asia. A reverse logistic path is used back to suppliers. Ewals Cargo Care takes care of the pre-finance and insurance of all modules and final products. Invoices are sent after delivering the final products to the clients customers. Result With this solution, our client is able to precisely predict its logistics costs. Furthermore, the client can compare efficiency results with its former logistical process and is able to concentrate on its core business. Due to a weekly reporting system, the client is continuously aware of our performance based on the service level agreement.
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Company Name Expeditors Int'l of Washington, Inc. Address: 1015 Third Avenue 12th Floor, Seattle, WA 98104 USA Phone Number: 206-674-3400 Email Address:
[email protected] Fax Number: 206-682-9777 Website Address: www.expeditors.com
Subsidiaries or Related Companies Asset Focus: N
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1979 Market Area: Founding Business: Int'l Ocean Freight (A = Asset Based, N = Non Asset Based)
OVERALL CAPABILITY
Overall Capability of Provider: Very good/excellent international forwarder with heavy Asian/China inbound SCM.
KEY PERSONNEL
Peter Rose Tim Barber Glenn Alger CEO & Chairman E.VP Global Sales Pres/COO Jordan Gates Jeff Musser EVP, CFO & Treasurer S.VP & CIO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 3,908 1,060 * 10,566 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol EXPD Exchange: NASDAQ
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 110 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 6 (Million) 53 12
Asset Ownership v.s. Leased: Transportation Equipment: About 50/50 Owned/Leased Warehouses/DC's: Mostly Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 1034761 Total Annual Airfreight Tonnes: 563000
MARKETS
Automotive Retailing Computers, Electronics Technology Healthcare
(For functional specializations, see "Customers" section.)
Heating & Air Conditioning Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating: G (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary D-Pad Entry Maker EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials Other Services:
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: 79 locations worldwide
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Ace Hardware Cisco Systems Dollar General Gap General Electric Merck Motorola
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Expeditors Location
Chicago, IL; Asia
Industry
Retailing Technology Retailing Retailing Industrial Healthcare Computers, Electronics
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Nashville, TN San Francisco, CA Louisville, KY
Schaumburg, IL
Philips Consumer Electro Computers, Electronics Toyota Trane Automotive Heating & Air Conditioning LaCrosse, WI
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COUNTRIES with OFFICES
Africa
Angola Bahrain Cameroon DR of Congo Egypt Ghana Israel Ivory Coast Jordan Kenya Kuwait Lebanon Madagascar Mauritius Morocco Mozambique Nigeria Oman Qatar Senegal South Africa Tanzania Turkey United Arab Emirates Zimbabwe
Countries served through owned offices or agents Australia / Pac.Isles
Australia Fiji Guam Mariana Islands New Caledonia New Zealand
Expeditors North America
Canada United States
Asia
Bangladesh Cambodia China India Indonesia Japan Korea Malaysia Nepal Pakistan Philippines Saudi Arabia Singapore Sri Lanka Thailand Tunisia Vietnam
Europe
Austria Belgium Bulgaria Croatia Cyprus Czech Republic Denmark Estonia Finland France Germany Greece Hungary Iceland Ireland Italy Kazakhstan Latvia Lithuania Malta Netherlands Norway Poland Portugal Romania Russia Slovak Republic Slovenia Spain Sweden Switzerland Ukraine United Kingdom
South/Latin America
Argentina Brazil Chile Colombia Costa Rica Dominican Republic Ecuador El Salvador Guatemala Honduras Mexico Nicaragua Paraguay Peru Puerto Rico Panama Uruguay Venezuela
EDITOR'S COMMENTS
Expeditors continued its strong organic growth in 2005. Net revenues reached $1.06 billion and produced a 27.2% gross margin. Net revenues are 38% air freight forwarding, 38% customs brokerage and 24% ocean freight forwarding. U.S. and Asia business account for 70% of revenues. Expeditors is the largest forwarder/NVOCC in the Asia/U.S. lane. It handles 350,000 TEUs per year with a 4:1 imbalance. 210,000 TEUs are from China to the U.S. Expeditors’ European operations are primarily in airfreight and constitute 16% of revenues, growing 4% in 2005. Expeditors continues to be one of the best run freight forwarding operations. It has had some recent personnel defections and their impact needs to be watched. Provider's Strengths Peter Rose and his colleagues are operationally strong, team oriented and profitable. Provider's Weaknesses Expeditors is not large enough to stand alone. At some point, it will come into play.
CASES & NEWS
What Rose Knows [American Shipper, November 2005, pg. 56] For a perspective from the ground up of Expeditors International of Washington Inc., a Seattle-based global logistics company now in its 25th year, the parking garage is a good place to start. Among generally upscale vehicles in the garage, which is under a downtown Seattle building owned by Expeditors, a certain Range Rover would have little interest for outsiders. Within the company, it is know that the Range Rover belongs to Peter J. Rose, Expeditors’ chairman and chief executive officer. It is also known that Rose himself – not the company – pays for his parking slot, like any other employee. Twelve floors up, in Expeditors’ decently appointed but far from palatial offices, Rose expressed in an interview the pride he feels in his company’s strong performance. Expeditors had $3.3 billion in gross revenues in 2004 and net earnings of $156.1 million. The company has come a long way since being registered in 1979 as a single-office ocean forwarder in Seattle. Rose and his co-founders started Expeditors with $300,000 “and a very debonair attitude,” he recalled. “We didn’t know how it would turn out.” For his part, Rose used “every last liquid asset I had,” and then borrowed from his daughter’s life insurance policy to assist in capitalizing Expeditors. “By 1981, we had 20 people in six offices. Today, we have 9,500 employees in 183 offices – and all of that growth was done organically,” he
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said. “Because we’ve made it very clear that Expeditors is not for sale, one myth you hear about us is that we are acquisition-adverse,” he said. “ Nothing could be further from the truth. We’ve probably done 18 acquisitions over the years. They’ve all been organic, meaning that we’ve bought an existing agent that we had come to know and trust for at least five or six years first. Those acquisitions were really quasi-joint venture mergers.” It is quite common for a company that’s interested in being sold to sing a we-aren’t-for-sale mantra right up to the announcement of its acquisition. However, in the case of Expeditors, Rose fervently means what he says. “Today anybody can buy anybody. Our not being for sale has nothing to do with price, but everything to do with pride,” he said. “There’s a lot of what I call ‘comfortability’ around here when I tell our employees that we’re not for sale. “They know I will never call their managers into a room and say, ‘everything I’ve told you for the last quarter-century is a lie’ – meet your new destiny,’ Because of that trust, we have a very high employee retention rate,” Rose said. That ‘comfortability’ is not a shield behind which executives, including Rose, have carte blanche. “This company is not to be played with or toyed with. One of the reasons we’ve done so well is that we have remained pretty much scamproof,” he explained. “People try scamming us, of course. That’s one of the reasons that I abhor consultants.” “CEOs who have gone to jail for corporate thieving, and others who should be jailed but haven’t been caught, always whine and say, ”I could do what I wanted because my board of directors approved it.” “If I did anything like that around here, they’d have my skin,” Rose said. Expeditors has a reputation as a very quiet company when it comes to marketing. Asked if it might be too quiet, Rose said, “I don’t think so. People see us out there doing business, but they don’t hear us talking about it. Yet word somehow gets around. We don’t advertise because we don’t have to.” Expeditors’ rates are not the lowest around, which doesn’t seem to impede the company’s growth. “Our rates are actually extremely competitive,” Rose asserted. “I think it’s well enough known that if you order lobster at market price, you’ re not going to get that lobster for the price of chicken.” When Expeditors started in 1982, “we were an inbound air freight forwarder dealing with goods from the Far East. By 1984, we were doing NVOCC (non-vessel-operating common carrier) work, ocean forwarding inbound and outbound, air freight inbound and outbound, and then we expanded to warehousing, distribution and marine insurance,” he said. “We still have our NVOCC function, under the name Expeditors. We have our Expeditors Cargo Management service. Most of these functions are wrapped around optimum supporting technology,” he explained. Expeditors’ ocean volumes have been strong for all of 2005, as evidenced by monthly container count increases of about 20 percent yearover-year. On the other hand, air freight tonnage is not looking particularly robust. “There definitely was freight that has traditionally been air freight moving by ocean between March and May 2005. I’m not ready to say that this reflects a permanent shift to ocean freight,” Rose said. “There was some diversion from ocean to air freight during the last part of June.” “The diversion of cargo from ocean to air will make whatever dent is going to be made in the air freight markets only. The amount of cargo that can move by air, relative to that moving by ocean, is not enough to be noticed in the ocean market. The amount of air freight capacity that would be required to make any sort of splash in the ocean markets literally does not exist,” he explained. “The ratio for Expeditors’ inbound vis-à-vis outbound shipments used to be three to two, then it was four to two, now it’s like five to one. “Our mix in 2005 is about 70-30, 70 percent inbound, 30 outbound overall,” he said. The percentage of Expeditiors’ net revenue by import and export volume flows has shifted in some geographical divisions Rose explained that the “drastic shift in the Middle East and Indian Subcontinent is a reflection of substantial growth of imports into markets such as India, Turkey and Egypt. “The shift in the Far East is due to increases in inter-Asia traffic, and the growth of imports into the markets of Japan, Korea and the People’ s Republic of China,” he said. Expeditors’ ocean carrier strategy involves making annual volume commitments with multiple carriers for some portion of its anticipated container volumes. Factors influencing these commitments include pricing, service levels, availability and predicted volumes based upon recent experience. “What is not moved under contract, moves on an ad hoc basis,” Rose explained. “These negotiations are typically conducted annually, and then refined on an ongoing basis to meet changing customer and carrier needs. The negotiations themselves focus around volume commitments and pricing levels,” he said. “In some respects, pricing is just pricing, as the actual amount paid can be expected to move according to conditions set forth by contract and with the amounts otherwise available on the spot market.” “The interesting part of formulating our annual ocean strategy is establishing just how much of our total expected container volume we will wrap up under contracts, and how much we will trust to the spot market,” he said. “The actual decision will vary from year to year. We have contingency plans designed to react to situations that could arise if the most likely scenarios don’t.” Rose said there is a “vast middle ground” between those customers who seek contract rates versus those who purchase on a spot basis. Essentially, they are “customers who have no contract, but who have an expectation that the rates they have been given will hold until further notice,” he said. “These are rates that don’t move with the spot market exactly, but they aren’t very fixed either,” he noted. Even customers with contracted rates will face the potential for rate adjustments due to market circumstances. Also, customers who purchase Expeditors’ services using a fresh rate quote expect that rate to remain firm until their shipment is delivered, and so they are not truly purchasing at a spot price. “If you look at the entire range of customers to whom we provide services, we have just a few contracts, and none are the binding sort of mutual commitment,” Rose said. “All of Expeditors’ contracts allow for termination over a relatively short period of time, or allow for marketing pricing adjustment, or both. “Because of the dynamic nature of the logistics business, the contracts we do have contain provisions that are sufficiently flexible to allow for routine business situations, such as pricing changes, to occur in a manner that doesn’t get in the way of moving the freight,” he explained. “No company can lose money on every shipment and make it up with volume. Why some of the other guys keep trying to do that is beyond me,” Rose added. “Ocean carriers have been successful in increasing their rates for the past couple of years. We don’t expect that to change. For the remainder of 2005 and into 2006, rate increases will be driven by two dominant variables: fuel and capacity. “Fuel is anyone’s guess. While there are rumors and expectations of capacity increases, you also have to consider port infrastructure issues that will provide constraints, although not to the degree anticipated this year,” he said.
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Asked why last year’s peak season meltdown didn’t occur this summer as many analysts had predicted, Rose said, “every year recently has been an anomaly. “This year, there wasn’t an anomaly to screw up business. In 2001, we had 9/11. Then there was the ILWU (International Longshore and Warehouse Union) strike, followed by the SARS epidemic. “Last year, there was a general sense of apprehension that ‘something’ would happen, which did occur in the Asian tragedy of the tsunami at the end of the year. In 2005, aside from hurricanes, not much has occurred to cast a shadow over trade,” he said. The ports of Los Angeles and Long Beach were able, in Rose’s view, to handle the predicted 14 percent increase in Asian imports because “ they learned some lessons from the congestion last year.” Rose said shippers’ and carriers’ decisions to move cargoes through alternative ports to Los Angeles and Long Beach, unfortunately, had “ More to do with selling against and capitalizing on Los Angeles and Long Beach’s current challenges and less to do with the alternative ports innate advantages. “Most of the freight that could capitalize on these innate advantages has already been transiting through those ports for a long time,” he said. The logistics mess created by hurricanes in the U.S. Gulf has caused some shifts in Expeditors’ shipments, Rose noted, but won’t have a longterm impact. Asked if the current levels of selective capacity deployment by ocean carriers is sustainable, Rose said that, as a matter of theory, “there is most certainly some level at which new capacity coming on line, when added to existing capacity redeployed to secondary and tertiary carriers, will result in a glut of capacity that will reduce overall market pricing.” If that is correct, “then what we’ve been seeing in the ocean markets in the last couple of years is theoretically unsustainable. The great unknown is the proverbial containership that will break the camel’s back,” he said. “Once we reach that tipping point, the pricing power that the carriers presently possess will begin to slip away,” he explained. Expeditors has definitely encountered customer resistance to passing on fuel costs. “Sadly, there’s no end in sight. Analyses are talking about fuel prices going well over $4 a gallon, perhaps as much as $5,” Rose said. “That will change buying habits among U.S. consumers, if it doesn’t cause a revolution.” Still, compared to Europe, “where they pay $6 or $7, I guess it’s all relative,” he added. Some of Expeditors’ customers understand why certain costs are passed on to them. “When we recently mentioned to Wal-Mart our currency adjustment factor on goods from Asia – let’s say it was 2.5 percent at the time – they said, ‘yeah, we understand. We realize you’re going to pass it on to us, and we accept it. “They know that’s the cost of doing their business, ” Rose said. Asked to explain how fuel surcharges affect rates for air freight, Rose cited the following example: “Assume, based on our volumes and freight mix on the route, that Expeditors’ buy rate for a shipment from Lower Slobovia to Upper Crustacia is 80 centers per kilo and the rate offered to our customers $1 per kilo. We would have a net revenue margin of 20 cents and an air freight yield of 20 percent per kilo. “Now, let’s say that the price of fuel goes up and airlines impose a 10 percent fuel surcharge. Our costs go from 80 cents per kilo to 88 cents per kilo. Now if we do nothing, our net revenue margin becomes 12 cents and our yield becomes 12 percent – clearly an undesirable result. “In order to maintain our margin, we immediately turn to our customers and begin the time-honored ritual of negotiating to pass on a fuel surcharge. This is a very complex ritual that the uninitiated can easily fail to fully appreciate. I can’t reveal too much. But it can be said that after some period of time, the rate charged to our continuing customers will move from $1 per kilo to $1.08 per kilo. Internally, we have maintained our per fuel surcharge margin of 20 cents per kilo, but the yield is now only 18.5 percent.” Asked if non-asset-based Expeditors was seeing more competition from other supply chain solutions companies that own assets, Rose said, “ The sort of competition we’re currently seeing has always been there.” “Is it more intense in 2005? My answer is no. We’re being regaled with just another flavor of the dancing circus bear. The outfits may change, the routine gets upgraded and the music may be different, but at the end of the day, a dancing asset bear is still a bear in a tutu,” he said. “They may try to present an image of refinement costumed in a supply chain outfit with a flashy IT wig, but you’re still just watching a bear dance.” Rose also noted that two major European air forwarders have publicly moaned about competitive pricing by unnamed ‘other forwarders’ in the international air freight market. “That’s like a couple of great white sharks complaining that ‘other sharks’ are involved in a feeding frenzy. What they are really communicating is that they didn’t get enough to eat,” he said. “We know that great white sharks can’t talk, but we doubt they ever voluntarily turn away from a chance to eat. It is possible to imagine that the water might eventually get too shallow for these behemoths, or that an old shark may just swim too slow to catch much.” Certain topics vex Rose in 2005 as much as in the past. One is corporate governance, which in his view has created a baleful environment for projecting company performance. “In our pro-forma disclosures, we have used the historical volatility of Expeditors as the best proxy for future volatility,” he said. “However now that Generally Accepted Accounting Principles (GAAP) is taking us all off the deep end, we will need to abandon our historical touchstone and embrace the unknown and unknowable. This is GAAP in the brave new Sarbanes-Oxley world.” “We have read experts who devote a great deal of ink to teeth gnashing over potential legal liability for a corporation to accurately estimate future volatility. It’s much like the three bears: if your estimate is too high, you overstate the expense and understate earnings and depress the stock.” “However, if you estimate too low, you will have understated expense and artificially inflated your stock. The only solution is to use the volatility that is ‘just right.’ Only Goldilocks and securities litigator using the clarity of hindsight will know for sure,” he scoffed. “One of the reasons I’m so anti-Sarbanes-Oxley, which was born out of the greed and avarice of so many companies, is because I don’t take 500,000 or a million shares a year for myself, give another 500,000 to two other top people, and see that everyone else gets two shares,” he said. From the beginning of Expeditors, “we decided to give our employees 20 percent of the pre-tax bottom line, rose said. “The whole premise of our company – and the biggest advantage of being publicly held – was to give a young person who worked at Expeditors a $250 share option or a $500 share option,” he explained. After five years, “a number of our young people were earning in six figures,” he recalled. “Most of them are with us in 2005.” “We recently had two of our younger executives come in and meet our board. One of them was asked, ‘how long have you been with Expeditors?’ ’20 years,’ he replied. The other executive noted he was 36, and had been with the company for 18 years,” Rose explained. Asked what still fires him up after a quarter-century, Rose said, “My kicks come from having some influence on the careers of those younger executives, and others like them.” Admittedly, there’s an old-school side to Rose’s “tough love” of his employees. “This has died down a little. But it used to be, in any staff meeting I went to in any office, I’d be asked, ‘when are we going to have a casual day? I said, ‘you’ve got two a week, knock yourself out,’”
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Rose meant, of course, Saturdays and Sundays. Rose is 62. Asked if he would still be at Expeditors a decade from now, he replied, “I don’t want to be asked to leave, or carried out. I hope I would know when to go.” “The succession is going to be internal,” he added. “We won’t be looking outside the company with all of the talent we have inside.” Rose admitted that “right now, I can’t leave. There’s nothing else I know, I don’t play golf. I’ve done plenty of travel. They say if you don’t do something within five years of retirement, you’ll probably die,” he added. “If you love what you do, the rewards from that have nothing to do with money.” The recent spate of high-profile mergers in the transportation industry is actually good for Expeditors, Rose said. “There’s always some consternation after a major merger. Obviously, to make acquisitions work, there are going to be economies of scale, and I would think that’s making some people nervous – vendors, employees and customers,” he explained. That situation definitely “creates opportunities for us to gain new business and hire worthy employees who leave one or both of the merged entities,” he said. “When mergers don’t really work out, it’s usually because of an egomaniacal chief executive officer who’s idle hand does the devil’s work,” he added. “I don’t want to be a rumor-monger, but I understand that Deutsche Post is going to buy General Motors, General Electric and Motorola and Wal-Mart,” Rose said with a grin. Rose was born in Montreal, where his father, James, was master of transportation for the Canadian National Express, with responsibility for all trucks and drivers that met trains arriving in Montreal. Rose left high school and took a job as an office boy at Canadian Pacific. He went to night school for four years at Sir George Williams University, now renamed Concordia, taking high school and college courses. “It’s been self-education ever since,” Rose said. In 1964, CP transferred Rose to Chicago, where he worked in foreign freight accounting. After a sting with Compass Agencies, an agency for Great Lakes ship lines, he went to work for Harper Robinson. By 1978, Rose was that Company’s vice president for imports. The next year, he co-founded Expeditors International and never looked back. In 2005, leonine and charismatic as ever, Rose actually appeared mellow – for him. “The one constant in this business that I have seen over the years is that nothing stays the same for very long,” he explained. “In logistics, as in surfing, the only control is the control you make for yourself by picking the wave and keeping yourself in the right place.” “Also, as in surfing, it’s pure folly to think you can control direction or magnitude. Your only hope remains to keep yourself in the right position on the wave, and use your skills to stay upright as greater forces push you on.” Inimitably himself, Rose couldn’t resist adding. “That doesn’t change your direction – eventually, you’re going to end up near the beach.” What Trade Deficit? [Forbes Magazine, January 10, 2005]
There’s no hand-wringing about too many goods coming stateside from Asia at Expeditors International. Half of the Seattle shipping company’s pretax profit is generated there, and the growth in Asia trade has helped Expeditors increase revenues an average of 15% a year for the past five years. Expeditors owns no ships. Or planes. Or trucks. It buys space on board and sells it to its customers, making money on the spread. Almost all of its business involves trade between countries, so it also handles customs for its customers. Lots of companies do this, of course, but Expeditors runs the tightest ship among them. The company’s return on capital has averaged 23% over the past five years. It has no debt. The stock hasn’t had a down calendar year in a decade. Global trade growth has been a big help, but Expeditors has another edge: It pays its people well. Chief Executive Peter J. Rose, a Canadianborn former professional hockey aspirant, helped found the company in 1981 and instilled a generous bonus program. One-fifth of the pretax profit of each of Expeditors’ 170 branches from Boston to Bangalore is paid out monthly to the employees of that branch, and 5% goes to the regional manager in charge of several branches. If the branches keep the customers happy, they get paid well. To fatten their bonuses, they must add profitable business. There’s no cap to what they can earn, but if a branch losses money in a month, that loss has to be made up before they are eligible for another bonus. That probably hasn’t happened much recently: Through the first three quarters of 2004 revenues were up 26% to $2.4 billion and net income was up 32% to $113 million. Case Studies – Automotive Automating to Achieve Compliance Challenges & Objectives To increase their customs compliance rating which would address the number of customs audits, examinations and entry documents required. To reduce the opportunity for errors and use electronic information to improve data integrity while containing costs. Strategy To increase their customs compliance rating which would address the number of customs audits, examinations and entry documents required. To reduce the opportunity for errors and use electronic information to improve data integrity while containing costs. Customized Solution Entry Maker™, our proprietary software application, was enhanced to smoothly accept the customer's electronic invoice information into our customs brokerage system. Our skilled automotive team used this information to process customs declarations. The results were passed back to the customer's trade management system. This allowed the customer to view and analyze their data, pass critical information to their vendors and track their compliance improvement. A leading automotive manufacturer sought a highly automated and process-driven national customs broker to process customs entries, manage electronic entry data and support their compliance requirements while reducing overall program costs. The customs broker needed to receive and process electronic commercial invoice data, provide skilled entry preparation services and feed the data back to the customer's trade management system. One requirement was to systematically ensure accurate and consistent classification of their imported products. The improved process would need to drive their compliance program and ensure that they had achieved "low risk" importer status. The goal was to reduce costs and virtually eliminate product delays due to Customs examinations.
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Southern Border hub processing of rail and truck shipments as well as the advent of an Automated Manifest System environment added to the complexity of the situation. Expeditors employed its Information Technology Group to develop enhancements to its proprietary software application, Entry Maker™. These enhancements would allow complete automatic data processing without data manipulation. This improved the reliability, integrity and accuracy of the data. A team of customs automotive specialists was established to manage the entry process. Due to the volume of entries, the transition to electronic invoicing and paperless exchange of shipment and entry information was critical. Entry Maker™, our proprietary software application, was enhanced to smoothly accept the customer's electronic invoice information into our customs brokerage system. Our skilled automotive team used this information to process customs declarations. The results were passed back to the customer's trade management system. This allowed the customer to view and analyze their data, pass critical information to their vendors and track their compliance improvement. A leading automotive manufacturer sought a highly automated and process-driven national customs broker to process customs entries, manage electronic entry data and support their compliance requirements while reducing overall program costs. The customs broker needed to receive and process electronic commercial invoice data, provide skilled entry preparation services and feed the data back to the customer's trade management system. One requirement was to systematically ensure accurate and consistent classification of their imported products. The improved process would need to drive their compliance program and ensure that they had achieved "low risk" importer status. The goal was to reduce costs and virtually eliminate product delays due to Customs examinations. Southern Border hub processing of rail and truck shipments as well as the advent of an Automated Manifest System environment added to the complexity of the situation. Expeditors employed its Information Technology Group to develop enhancements to its proprietary software application, Entry Maker™. These enhancements would allow complete automatic data processing without data manipulation. This improved the reliability, integrity and accuracy of the data. A team of customs automotive specialists was established to manage the entry process. Due to the volume of entries, the transition to electronic invoicing and paperless exchange of shipment and entry information was critical. Through these changes, Expeditors was able to eliminate re-keying broker invoices by providing electronic invoicing. Further efficiencies were gained through the use of an electronic third party billing passthrough into the customer's trade management system at the general ledger code level. Through Entry Maker™, we capture third party fees such as wharfage, terminal and destination delivery charges. This eliminated the expense of re-keying manual invoices for vendor payment. Significant savings were achieved by accelerating speed to market. For example, the cost of a customs examination includes freight costs, labor, storage and revenue delays in bringing the product to the showroom floor. These enhancements, combined with a strong partnership, drove their compliance rating up from 69.8% to 99.2%. Customs has recognized this improvement by placing them the lowest risk category available to Primary Focus [Automotive] Industry importers. Compliance Rating: 69.8% - 99.2% Case Studies – Aviation, Airlines, Aerospace Productivity through Visibility One of the worlds largest, publicly traded, European based airlines, wanted to drive system wide practices that would deliver worldwide productivity changes, process improvements and reduce costs across the supply chain. Working in a collaborative environment with our client was a challenge. Although one enterprise, they are comprised of two separate operating divisions both requiring a consistent global solution to their logistics needs. With the introduction of computerized planning and ordering systems, the need for reliable transit times, availability of product, while maintaining a controlled cost environment was critical. Challenges & Objectives The challenge was to deliver solutions to reduce inventory levels, improve customer service standards, and create productivity tools that drive supply chain visibility. Strategy Our direction was to work closely with the business units, and field personnel, while benchmarking similar practices with existing clients in the same industry. Simultaneously, we used our knowledge, expertise and disciplines from other industries (i.e., high tech and telecommunications industries) to formulate our deliverables. Customized Solution A door-to-door seamless service provided for both the airlines catering and engineering entities that incorporated the mandatory business requirements of the end customer, and intermediaries into a cost effective, symbiotic product. Our customers challenge was to stay focused on the critical success factors of: continuous improvement, value analysis, improved forecasting and cross-functional improvements, while utilizing assets efficiently, and providing cost performances that added value and made sound business sense. Success would be based on the ability to adapt to rapid change, inventory reduction, and the improvement of customer service levels by providing supply chain visibility. Their industry catering division supplies 300 product lines including consumables, rotable equipment, dry goods and bonded alcohol from a centrally based distribution center, to caterer's worldwide for use on outbound aircraft. Our solution was to manage the orders from a central hub in London and deliver catering products directly to local caterers (airside) at the airlines worldwide facilities. These timed deliveries were based on needed stock (demand) to support keeping the airlines flights stocked and ready for deployment. In addition, the airlines engineering services environment demanded the movement of urgently needed parts (A.O.G.'s) on a 24/7/365 basis. This included a requirement to provide visibility, especially for the urgent consignments. A requirement for a reduction in transit times and a scheduled program to accommodate routine maintenance orders, were mandates by both the internal and external customer. Expeditors provided a global door-to-door aircraft spares program destined for maintenance facilities at worldwide airports. These critical spares required local Expeditors staff to facilitate customs clearance 24/7, and arrange local delivery (airside) so engineers could perform on14th Edition ©Copyright 2006 Armstrong & Associates, Inc., Stoughton, WI 53589 USA Page 158 of 378
ground maintenance. In both cases, we took a full view approach to the processes and product flows involved in both business entities and process mapped existing business protocols. We provided stability to the business, (customer and their suppliers), while achieving global consistency. Our success was aided by adhering to agreed standard operating procedures, transition and implementation plans, visible to all via a shared intra-net/extra-net arrangement. The client realized cost reduction benefits that extended across the entire supply chain. In 1999, this global carrier rated Expeditors service as 'Excellent'. We were then awarded the catering supplier of the year from a field of over 600 suppliers, for helping them achieve their challenge of delivering the most supply chain improvements. This successful program is measured by agreed and implemented KPI's (Key Performance Indicators). For the engineering group, a combination of process standardizations, cycle time reductions and landed cost reductions helped deliver a savings of nearly USD $1.0 million per annum. Within the catering environment, incremental costs rose slightly, but overall supply chain costs diminished which was a direct benefit of process re-engineering, process improvements, product visibility and adherence to customer demand dates. Both entities benefited from time and cost savings by the formation of a centralized billing processes and procedures center that drove quality standards, accuracy, consistency and dependability. In Summary, importation initiatives were organized to reduce customs fines, minimize duty liability and introduce processes to lessen liability, enabling both groups to realize: - Leveraged transportation purchasing - Reduced inventory - Improved distribution processes-channels - Improved sourcing decisions (verified from transportation, labor, and tax studies) - Defined and reliable cycle times - Visibility of product from order to delivery - Reduction of stock within the clients supply chain - Identified costs drivers: managed, measured, and reduced Visibility: 100% Overall Supply Chain Cost Reduction: 40% Customer Satisfaction: 100%
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Company Name Fatton Transport Address: 3, allee des Droits de l'Home, BP102, 69672 BRON Cedex, France Phone Number: 33-4-72-15-63-63 Email Address:
[email protected] Fax Number: 33-4-72-50-36-03 Website Address: www.fatton.com
Subsidiaries or Related Companies DISFAT (Lyon) Asset Focus: A Cognard (Roanne) GSI Air Fatton (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Fatton Transport Int'l Truck Transportation Year Started in Logistics: 1909
OVERALL CAPABILITY
Overall Capability of Provider: Capable transportation-based 3PL with U.S. - European forwarding service.
KEY PERSONNEL
M. Fatton M. Donati CEO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 45 45 * 410 1-3 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 250 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 300 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 5 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 5 (Million) 10
Asset Ownership v.s. Leased: Transportation Equipment: Owned Warehouses/DC's: Owned
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Fatton web Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition IDP EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials Other Services:
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: Roissy - Charles de Gaulle
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
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COUNTRIES with OFFICES
Africa Asia
Bangkok Hong Kong Taiwan
Countries served through owned offices or agents Australia / Pac.Isles Europe
Austria Denmark Finland France Germany Great Britain Greece Italy Netherlands Norway Spain Sweden
Fatton Transport North America
Canada United States
South/Latin America
Argentina
EDITOR'S COMMENTS
Fatton provides European transportation, some warehousing/logistics and international freight forwarding. The U.S. contact is Frederic Marcerou, District Manager at 630-595-2477 or www.fattonusa.com. Provider's Strengths French-based Euro road network, U.S. offices - Chicago and New York. French competition is not strong. Provider's Weaknesses Scope is limited.
CASES & NEWS
2/27/2001 Fatton with Assocam The French road hauler Fatton Transports SA in Saint-Priest (Lyons) has recently started cooperating in the trade to and from Milan with the company Assocam Trasporti Internazionali Srl, based there. Together, the two companies offer three truck groupage services a week in each direction. (Source: INTERNATIONAL TRANSPORT JOURNAL)
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Company Name FedEx Supply Chain Services/FedEx Trade Networks Address: 5455 Darrow Road, Hudson, OH 44236 USA Phone Number: 800-222-7657 Email Address:
[email protected] Fax Number: 330-655-0503 Website Address: www.fedex.com
Subsidiaries or Related Companies FedEx Express (Federal Express Corp.) Asset Focus: A, N FedEx Ground (RPS) FedEx Custom Critical (Roberts Express) FedEx Freight (Viking, American) (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: FedEx Corporation Int'l Motor Transportation Year Started in Logistics: 1989
OVERALL CAPABILITY
Overall Capability of Provider: Capable 3PL oriented toward feeding parent companies. Sister company FedEx Trade Networks is a good customs brok
KEY PERSONNEL
Douglas Witt Mark Colombo Tom Schmitt President & CEO VP Marketing SVP, Worldwide eSolutions Lori Lutey Rebecca McClendon VP Finance VP Information Technology
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 672 209 * 2,000 99 4-5 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol FDX Exchange: NYSE
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 298 Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: 1,094 Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 298 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 1,094 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 35 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 6 (Million) 20
Asset Ownership v.s. Leased: Transportation Equipment: Mostly Leased Warehouses/DC's: Mostly Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: >10000 Total Annual Airfreight Tonnes: 6965000
MARKETS
Apparel/Garments Computers, Electronics Industrial Telecommunications Automotive Consumer Goods Oil & Energy Textiles Boats Containers Retailing
(For functional specializations, see "Customers" section.)
Building Materials Healthcare Sporting Goods Chemicals Heavy Equipment Technology
Transportation, Moving
INFORMATION SYSTEMS
Overall Information Systems Rating: E (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): i2 Technologies, Optum Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: CAPS EXE Technologies i2 Technologies i2 Technologies Venture
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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Other Systems Capabilities: Bar Coding Demand & Supply Forecasting
EDI Handling ERP Interfaces
Integrated TMS & WMS Internet Customer Access
Radio Frequency Devices Real-time Track & Trace
XML Data Handling
TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials
Food Grade/Sterile
Temperature Controlled
ISO Certified Certification Locations: Twinsburg, OH; DCC locations Other Services:
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
3M 7-Eleven Abbott Labs Adidas Alltrista American Backhaulers American Red Cross Astra-Zeneca Pharmaceu Asus Ball Foster Glass Belk Stores Cascade Olympic Sports Cee Sportswear Champion International
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by FedEx Location TM WM VA DCC Inte IM Intl SCM Lead Other
Industry
Technology Retailing Healthcare Apparel/Garments Technology Transportation, Moving Healthcare Healthcare Computers, Electronics Containers Retailing Apparel/Garments Apparel/Garments Building Materials
Spartanburg, SC
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COUNTRIES with OFFICES
Africa
Dubai Egypt Israel Mauritius Turkey
Countries served through owned offices or agents Australia / Pac.Isles
Australia New Zealand
FedEx North America
Canada United States
Asia
Bangladesh China Hong Kong India Indonesia Japan Madagascar Malaysia Nepal Pakistan Philippines Singapore South Korea Sri Lanka Taiwan Thailand Vietnam
Europe
Belgium Denmark Finland France Germany Holland Ireland Italy Norway Portugal Spain Sweden Switzerland United Kingdom
South/Latin America
Brazil Puerto Rico Uruguay Peru Chile Bolivia Argentina Mexico
EDITOR'S COMMENTS
Contract logistics, freight forwarding and customs brokerage at FedEx are service businesses whose role is to support FedEx transportation. FedEx SCS has lost key business and is no longer a major third-party logistics competitor, although its parent is a key global air freight player and SCM. For FedEx, SCM is a value-added part of express, package, less-than-truckload and other operations. Revenues shown above include FedEx Trade Networks. Provider's Strengths Good match for customers who will use other FedEx businesses extensively. Provider's Weaknesses Lack of neutrality in choosing carriers.
CASES & NEWS
FedEx Brakes HOS Request [by Angela Greiling Keane, Traffic World, August 21, 2006] FedEx Ground says its on-and-off request for an exemption to federal hours of service rules for some of its drivers was simply a matter of time. The parcel division of FedEx said last week it was pulling its request for an HOS exemption, an application that came as the company is fighting dozens of legal battles across the country over whether some of its ground delivery drivers are independent contractors or should be classified as company employees. The parcel division of FedEx said last week it was pulling its request for an HOS exemption, an application that came as the company is fighting dozens of legal battles across the country over whether some of its ground delivery drivers are independent contractors or should be classified as company employees. The request, which would have applied to more than 4,100 drivers, was separate from the independent contractor fight, which involves some 14,000 drivers. FedEx’s request had drawn criticism from some drivers and from the International Brotherhood of Teamsters, which is fighting the company on the independent contractor question. “The best reason to give you (for withdrawing the request) is that our business continues to evolve and we are assessing internally whether this is a need internally,” FedEx Ground spokesman David Westrick said. The company had asked the Federal Motor Carrier Safety Administration to let its FedEx Ground drivers be off the HOS clock when going between their homes and FedEx terminals before and after their last official stops for work. The regulations, which limit how many hours commercial drivers can drive and work, apply to these drivers from when they leave home to the moment they return with undelivered packages. “FedEx seeks exemption for itself and its 4,136 drivers from the requirement that the (commercial motor vehicle) be unladen in order for the time to be considered ‘off-duty time,” FedEx’s George Bosko wrote to the FMCSA. Because these drivers are independent contractors, they own or lease the vehicles used for FedEx deliveries and may use them as they choose when not on delivery duty. The drivers only make deliveries, not pickups. The company has fought legal challenges in places including California, Indiana and Massachusetts that seek to classify FedEx Ground drivers as FedEx employees rather than independent contractors. According to a group of lawyers representing labor in these cases, 31 such suits are pending against FedEx Ground or FedEx Home Delivery in 24 states. FedEx calls its drivers owner-operators and says they prefer the current business model. “We firmly believe the vast majority of our 1,000 contractors in California want to retain their status so they are free to pursue the many opportunities afforded them as owner-operators,” the company said after a California court ruled in favor of a class of workers challenging their employment status. Similar to Pittsburgh-based FedEx Ground, a $4.7 billion FedEx division that began as Roadway Package System, DHL uses independent contractors for parcel deliveries. Unlike FedEx, which directly employs the drivers as contractors, DHL hires the drivers through third-party companies. Delivery drivers for UPS are company employees as are drivers for FedEx Express, FedEx’s air division.
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The Teamsters union, which voted at its annual convention in June to help FedEx contractors join the union, opposed FedEx’s HOS application but had not commented formally to the FMCSA. FedEx Upgrades FedEx Global Trade Manager and FedEx Ship Manager [Eyefortransport, March 9, 2006]
FedEx Corp has significantly upgraded FedEx Global Trade Manager, a free online resource designed to help SMEs to reduce the complexities of shipping internationally, and FedEx Ship Manager. Available 24/7 on www.fedex.com/us, FedEx Global Trade Manager gives customers access to customs documents and regulatory advisories for more than 200 countries, allowing customers to look up import and export requirements for each country based on shipment and commodity information. Previously, 42 countries were covered. The Product Profiles feature of FedEx Global Trade Manager has been expanded, allowing international shippers to quickly and efficiently create, store, edit, group and manage information for up to 500 commodities. In addition to managing commodity databases with advanced sorting and grouping capabilities, customers can also upload large commodity databases from a CSV file with the Product Profiles feature. The International Denied Party Screening tool, which allows shippers to see if any individuals, companies and other parties have been denied international business transactions, has also been expanded. Screening results now include information from European Union and United Nations countries, Japan, Canada and US lists. The database is searchable for restrictions by country, company name, customer name or even address on FedEx Global Trade Manager. With enhancements to FedEx Ship Manager at fedex.com, customers may now automatically receive a tracking update if there is a delivery issue with a shipment. Shippers can arrange for FedEx to send an email message plus a tracking update in one of 16 languages, to as many as four email addresses. Customers now also have the ability to process 25 multiple-piece shipments at one time, an increase from ten multiplepiece shipments. Customers can also check the status of a package anytime online, store up to 2,000 names and addresses for future use, prepare shipping labels for repeat shipments to the same address, arrange for courier pick up in several countries, and receive an account-specific courtesy rate quote. FedEx Ship Manager at fedex.com automatically stores 45 days of shipping history, and customers can prepare labels quickly with as few as two clicks using Fast Ship Profiles. According to executive vice president, FedEx Express, international, Mike Ducker, FedEx connects more than 90% of the world's GDP, and is the largest customs entry filer in North America. FedEx Corp. Taking the Next Step in China, as FDX Buys Out J-V Partner [Morgan Stanley Equity Research, January 24, 2006]
Quick Comment: We weren’t surprised by FedEx buying out its Chinese partner, Da Tian Group (DTW), as Chinese law recently changed to allow foreign parcel carriers to fully own their operations (UPS bought out its j-v in December 2004). But the specific move to acquire greater control of domestic operations is a new wrinkle as FDX has historically only been interested in Chinese import/export moves. FedEx’s purchase included DTW’s domestic express assets, suggesting FDX intends to compete in the intra-city parcel segment, but likely only for highvalued multinational corporate shipments, which is a move that DHL has also recently taken. Approximately 3,000 of the 6,000 employees that FDX will employ in China will be associated with the domestic business. We expect the $400 million deal to close in late summer and FDX to apply for the necessary licenses to service the domestic market before then. China is the fastest growing express/parcel market in Asia and, at approximately $2 billion in size (for only import/export parcels), the region’s second-largest express/parcel market (only after Japan). FDX had approximately $800 million of cash on hand as of F2Q06 and we forecast it will generate $3.4 billion of cash flow from operations in its F2006 (ending May 31), sufficient to cover the $400 million acquisition. FedEx Corporation (FDX) Buys Out Chinese Express Partner [Baird/U.S. Equity Research, January 25, 2006]
Action Acquisition provides FDX with 100% stake in Chinese operations and provides an entry point into intra-Chinese express operations. The deal underscores China’s importance in the strategic expansion plans for FDX and other integrators. No change to estimates; maintain Outperform rating. Summary FDX announced the purchase of DTW Group’s 50% interest in its International Priority express joint venture and DTW’s domestic express network (89 locations) for $400 million. The deal is expected to close in late summer and to be financed with cash. The acquisition provides FDX with full control over its Chinese express operations and expands its Chinese footprint. Additionally, it provides FDX with an entry point into the domestic express (intra-China) operations. We do not expect Chinese domestic express revenue to be material in F2006 or F2007. FDX currently runs 23 China frequencies per week, with plans to add three more in March. FDX’s international network connects over 200 Chinese cities, and should expand by 100 cities during the next few years. Upon completion, FDX will employ over 6,000 people in China. UPS bought out its Chinese international express partner, Sinotrans, in December 2004 for $100 million, giving UPS control of 23 facilities in China. UPS’ operations in China are international oriented, but it plans to layer on greater domestic capabilities in 2006. UPS has 18 China frequencies per week and will add three more in March. UPS operates over 75 Chinese facilities, has a presence in over 200 Chinese cities and employs roughly 3,500 people. No change to estimates. We expect the deal to be modestly accretive. We maintain our Outperform rating and $115 price target that reflects 17x our C2007 estimate of $6.75. Absolutely, Positively … [Rueters, September 6, 2005]
Shipping is, as a business, highly sensitive to the economy. In general, a growing economy should result in impressive results for FedEx. Fiscal 2005 (ended May) fits squarely into that generality. FedEx reported a top-line gain of 10% year-over-year, and an operating profit gain of 8%. That said, its operating margin was down modestly, to 9.6% from 9.7%. The reason for the margin narrowing – and I caution that it’s a slim narrowing – is that the company is expanding its Express segment with an around-the-world flight to the west (that is, to Asia) in anticipation of international growth.
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Two points: First, the astute might pick up on the fact that the margins didn’t suffer because of fuel costs, which is a bit surprising at first glance. FedEx charges its customers a fuel surcharge, so it is passing on the increased jet fuel costs to customers. Parenthetically, jet fuel prices have been rising faster than the price of oil, and that’s saying something. Wait a second…doesn’t that mean that, in a highly competitive industry, FedEx is raising prices? Indeed, it does. Fortunately, this is a fairly elastic business. FedEx’s business tends to be driven by pre-existing contracts, typically for shipping between two businesses. It would be an understatement to say that most businesses are aware of currently high oil prices. For its corporate customers, FedEx allows some room for negotiation with regard to the fuel surcharge, but generally, according to FedEx, its customers have been understanding and accepting. I’d imagine grudgingly so. Still, FedEx is raising prices to keep its margins while UPS is swallowing more of the fuel costs itself. It’s difficult to say what the better plan is, but I, for one, hope that oil costs start falling. FedEx, in its June conference call, mentioned that its projections were for $60 per barrel oil prices, but it looks like they were just using the then-current price for oil. I’d assume that the company has since adjusted its projections, though it’s still possible that it will see more margin shrinkage this quarter. The second point concerning the narrowing margin is the westward-expansion plan. I’ve seen some analytical commentary to the effect that FedEx is going to have some real problems growing internationally. UPS, its prime competitor, has spent years building out its shipping network internationally, and now FedEx will be playing catch-up into unfamiliar territory. It’s not an enviable position, so I’d question whether this is a viable expansion route, at least in the near term. FedEx has, though, made several expensive acquisitions in the past few years, including Parcel Direct (now FedEx SmartPost), which will deliver customer’s packages to post offices nationwide, and, of course, Kinko’s. These are having the effect of turning FedEx from a shipping company to a full business-services provider. I think that this will be a successful transition for FedEx over the long haul. My final word concerning margins: Bear in mind that FedEx has had some margin pressure for the past year, and it has still seen a huge margin improvement For the full 2005 year, the margin expanded by 5.8%, despite a difficult fuel-cost environment. This, to my mind, just highlights that the company’s management is focused on the bottom line. Assuming that current oil prices won’t last forever, and that FedEx won’t, therefore, lose too much market share due to pricing, that’s a very good sign. My analysis indicates that FedEx has a potential earning growth rate of 13.8%, while the share price currently seems to reflect a growth rate of 6.8%. The shares carry a yield of 0.4%, which is a nice bonus, but shouldn’t attract any income seekers. But if you’re looking for value or for quality, FDX shares might warrant some consideration. FedEx expands ocean business [American Shipper, January 2003, pg. 65]
Less-than-truckload service offers LCL transport to Europe. FedEx Corp., most known for its express handling of small packages, is rapidly making a name for itself as a competitive provider of door-todoor ocean freight services. Since last year, two of the company’s operating units have ventured into a business traditionally controlled by freight forwarders and nonvessel-operating common carriers, and both have plans to expand their ocean freight services individually as well as cooperatively. For its newest ocean freight service, FedEx Freight will work with FedEx Trade Networks to provide less-than-containerload service between the United States and Europe. FedEx Trade networks will manage the NVO aspects of the operation, and will use the regional lessthan-truckload services of FedEx Freight for inland freight moves. For cargo handling in Europe, FedEx Trade Networks has established an exclusive agency agreement with Koninklijke Frans Maas Groep, which provides comprehensive coverage at seaports and has service locations throughout Western and Eastern Europe. The FedEx Freight LCL European service includes both door-to-door and door-to-port options with one invoice and a single source of accountability for shipment control. Alderman said the service offers competitive rates to domestic FedEx Freight LTL shippers seeking international service. This doesn’t mean that FedEx won’t handle global LCL and full-containerload ocean shipments. In February 2002, FedEx Trade Networks launched its Ocean-Ground Distribution service. This service bundles services offered by other FedEx operating units for shippers moving ocean freight from Asia and Europe to North America. 7-Eleven became the first company to use FedEx Trade networks’ Ocean-Ground Distribution service. According to Dick Garrison, 7Eleven’s executive director of non-foods merchandising, the company recorded “higher sales with lower costs” on holiday merchandise sold in its stores during a beta test of the service in the fall of 2001. Growth Clicks for HPshopping.com [Inbound Logistics, August 2004, pg. 52]
Hewlett-Packard launched an online store to sell refurbished personal computers back in 1998. “This grew out of a very small location that FedEx Supply Chain Services managed for us,” explains Michael Butler, supply chain and logistics program manager for the Sunnyvale, Calif.based HP division now called hpshopping.com. “From there, we started adding finished goods new inventory into the mix, and it has exploded, especially in the last 18 months.” Indeed, hpshopping has enjoyed year-over-year revenue growth of nearly 60 percent. “It’s not a small business anymore,” Butler says. “We are a consumer direct business.” To handle its growth, hpshopping is evaluating where to invest in infrastructure, technology (including RFID), and warehousing “to ensure we don’t stumble along the way,” Butler says. HPshopping’s supply chain is completely separate from other HP supply chains. “We place orders on HP divisions, acting more as a retailer than as another HP division,” Butler explains. Product is shipped to a 100,000 square-foot warehouse operated for hpshopping by FedEx Supply Chain Services. Ozburn-Hessey Logistics provides the labor and warehouse management team for the facility. “Product received at the warehouse before noon is on our web site for sales before 5 p.m. CST that day,” Butler notes. Customers can order standard items up until 10 p.m. EST and receive their order by 10 a.m. the next day via the first scheduled FedEx delivery. This means that a customer who places an order for toner after Office Depot closes can receive the package before the retailer opens the next day. New products play a large role in hpshopping operations. “Because the lifecycle of a PC is 29 days, we introduce new products weekly if not daily,” Butler says. The hpshopping facility can easily ramp up to handle spikes in volume. “Within 11 days, I can triple our throughput in Memphis,” he says. HPshopping also has a configure-to-order business for laptops and desktops, Butler says. These products are shipped from contract
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manufacturers in Mexico or China, depending upon the product. The online store’s customer-friendly returns policy generates more revenue than cost, Butler notes. “We send FedEx to pick up the return, and issue the credit within seven days. If the customer doesn’t want FedEx coming to their house, they can print the label and use FedEx’s NetReturns program to send the product back,” he says. Butler describes hpshopping as “an engine balanced on cost as well as customer service.” As part of his effort to contain costs, Butler challenges his logistics providers each quarter to implement a new cost initiative or increase overall effectiveness in some way. He uses a carrotand-stick approach to manage the logistics providers. For example, if cycle counts are off by more than $5,000 on a monthly basis, the warehousing providers pay half the cost of the discrepancy over $5,000. As a result, Butler says, “we’ve seen huge gains in their accuracy.” At the same time, he may offer a bonus to the management and labor levels if certain goals for a new product launch are met. While hpshopping does not serve Wal-Mart, Butler expects to benefit from the retailer’s RFID initiative. “HP is one of Wal-Mart’s top 20 vendors,” he notes. As a result, by the end of the year, 20 percent of the SKUs in the hpshopping distribution center will be RFID-enabled at the carton level. “Our challenge will be determining where the break-even is, when enough SKU’s are RFID-enabled so that we can see the real efficiencies,” Butler says. But the potential advantage is significant, as evidenced by the experience of another HP warehouse, where receiving of printers dropped from two minutes to six seconds through the use of RFID technology.
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Company Name Fiege Logistics AG Address: Joan-Joseph-Fiege-Strasse 1, 48268 Greven Germany Phone Number: 49-257-19-99-0 Email Address:
[email protected] Fax Number: 49-257-19-99-888 Website Address: www.fiege.com
Subsidiaries or Related Companies Fiege Deutschland Asset Focus: A Fiege Merlin Fiege Aser Fiege Kalf
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Heinz Fiege (A = Asset Based, Europe Transportation, Freight For N = Non Asset Based) Year Started in Logistics: 1979
OVERALL CAPABILITY
Overall Capability of Provider: Very good warehouse-based 3PL
KEY PERSONNEL
Hugo Fiege Thomas Stoken Andreas Resch CEO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 1,800 568 * 12,000 20 1-3 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 20 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Owned 20 (Million) 5
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Apparel/Garments Healthcare Automotive Heavy Equipment Building Materials Retailing
(For functional specializations, see "Customers" section.)
Computers, Electronics Technology Consumer Goods
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
3M Bosch Esprit Fujitsu General Motors Hanro AG Herlitz AG I.R. Bobcat Kaufhof/Horten OBI DIY Perilli Samsung Schott Glas Siemens
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Fiege Location
Germany
Industry
Technology Automotive Retailing Consumer Goods Automotive Apparel/Garments Misc. Heavy Equipment Retailing Building Materials Misc. Computers, Electronics Misc. Healthcare
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Germany
Poland France Berlin - Falkensee
Germany Germany Poland
Germany
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
France Germany Luxembourg Poland Spain Switzerland United Kingdom
Fiege North America South/Latin America
EDITOR'S COMMENTS
Fiege Logistics provides supply chain management services and designs the process to individual customers. It is organized into four divisions: FIEGE log - stationary logistics, warehouse management and affiliated IT systems FIEGE net - includes distribution systems and affiliated IT systems FIEGE ecm - combines e-commerce activities with logistics to successful online selling and offline delivery FIEGE engineering - in charge of consulting, development and realization of supply chain solutions Fiege and U.S. 3PL Kenco have cooperated for some international customers. Fiege is profitable and well run. Provider's Strengths VAWD third-party logistics. Provider's Weaknesses Geographical range (Northern Europe).
CASES & NEWS
Fiege take-over of tts Group and Rewico Greven/Hamburg - On March 24, 2006 the FIEGE Group takes over the tts Group based in Hamburg, as well as its affiliated company, Rewico Logistik International GmbH domiciled in Rangsdorf near Berlin, thereby increasing its sales volume by almost a quarter of a billion Euros to around Euro 1.8 billion. Dr. Hugo Fiege, owner of the FIEGE Group, declared that the integration of the two companies into the worldwide logistics network of the FIEGE Group is a further step in its European expansion drive: "For the FIEGE Group, which already operates successfully in Central Europe, Rewico represents a reinforcement particularly within Eastern Europe", explained Heinz Fiege, likewise owner of the internationally-operating FIEGE Group. "The takeover of the tts Group allows us to offer a new and highly-interesting distribution concept which harmonizes perfectly with existing FIEGE products. The integration of the tts Group places us well on track to becoming the Number One among the providers of logistics for commercial consumer goods in Germany". The tts Group will be contributing a workforce of 1,750 people and a turnover of Euro 177 million (figures for 2005) toward the FIEGE Group. tts has a fleet of 360 trucks and provides logistical services from 20 locations in Germany for the "who's who" in the consumer goods industry, including Bacardi, Beiersdorf, Bosch, Colgate-Palmolive, Eckes, Ferrero, Henkel, Johnson Wax, GlaxoSmithKline, Metro MGL, Nestlé, Haribo, Racke and Reckitt Benckiser. "It is our customers who will be the winners", explained Jens Meier, Chairman of the tts management board, "because, as from today, they will benefit from a wider range of complementing logistical services all from one and the same company". For Jens Meier, who in the past three years completely reorganized tts and brought it back into the black, the take-over by FIEGE presents a significant strategic step towards a secure future. "Our customer base and new responsibilities increased at a tremendous pace and we were faced with the situation of placing this substantial growth in size and volume on a new foundation, not only financially and operatively, but also internationally". In the run-up to the now concluded signing of the contract, the tts Group had held negotiations with several potential logistics companies, thereby considering the best constellation of partners. The new partner was to fulfill basic prerequisites: proven know-how in the food sector, high-level IT affinity and process quality. "In the end, it was the FIEGE concept which convinced us all", said Jens Meier, "as it is based on both partners merging their core competences without destroying those structures and processes which have evolved and become established over the years". Fiege to make more European acquisitions [Transport Intelligence, October 3, 2005]
Consolidation in the European logistics industry is likely to receive extra momentum, following reports that German logistics provider Fiege is looking to make more acquisitions. Fiege is one of the largest contract logistics companies in Europe, and is particularly strong in Germany. According to an interview in a German newspaper, it is looking to increase its presence in France, the Nordic region and Central & Eastern Europe. Fiege started its European expansion in the mid-1990s, when it acquired companies in the UK, Switzerland, Iberia and Benelux. Its strategy at the outset had been to adopt a de-centralised management approach although over the past few years all the subsidiaries have been rebranded. Heinz Fiege, managing director of the company, is reported to have stated that the company is looking to spend about €300m on new acquisitions and to this end it has already drawn up a target list of companies. On a different matter Fiege commented that he believed that his company would benefit from the acquisition of Exel by Deutsche Post World Net. The considerable integration process involved would result in a loss of management focus at DPWN which could mean his company picking up new customers. Fiege in partnership deal
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[Transport Intelligence, August 24, 2005]
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RH Freight, the UK warehousing and freight network, has just completed a partnership deal with Fiege Logistics in Switzerland, part of the German logistics company Fiege Group. RH will become Fiege Logistics’ exclusive UK partner from September and will be operating several weekly groupage services to and from Switzerland from its hubs in Nottingham and Thurrock. The partnership with Fiege Logistics is one of several new partner arrangements that RH has negotiated recently. In February, RH agreed a to co-operation with M&M for Morocco and Tunisia. In April, the company signed an exclusive deal with Intereuropa to cover the former Yugoslavian states and Albania. New logistics concept for UK distribution The British subsidiary of the Fiege Group has taken over the entire distribution logistics for The Consortium, one of the largest national buying and distribution specialists, and started operations in mid-February 2003. The development and setting up of the complex logistical project has been completed, and first deliveries by Fiege have already taken off. “The decisive issue for our decision to commission the Fiege Group with the distribution activities was the fact that Fiege could offer a costefficient while innovative and tailored solution for us,” explains Mark Barnett, Supply Chain Director of The Consortium. “Our customers expect a flexible supply chain which adapts to all necessary changes. And Fiege offers the right integrated supply chain concept with a nationwide network.” The product range which is offered via a catalogue extends from stationery and office supplies through to syllabus products. It includes some 10,000 different articles which are delivered to 25,0000 customers, primarily schools, universities and authorities. 46 Fiege staff are currently in charge of securing a smooth logistical flow. “Our concept offers a supply chain solution to our partners which fully meets their high demands,” emphasis Richard Horswill, Managing Director of Fiege UK. “The jobs have to be carried out quickly and efficiently – at any time. We meet this demand with a shared-user concept which is so far unique in our industry.” The complete tracing of consignments through to the recipient is a further additional service which offers customers maximum transparency of consignment statistics. Schott and FIEGE Establish Logistics Joint Venture Mainz-based Schott Glas will co-operate with FIEGE Deutschland, Greven for the logistics of its television glass segment. A joint venture in which FIEGE holds 51 percent and Schott 49 percent will cater for the entire internal and external transport as well as the dispatch of annually around 15 million glassware items for television tubes in the future. The 200-man strong staff of Schott entering the co-operation will be taken over by FIEGE’s new company named novalogistics. The principle agreement concluded at the end of November regarding the logistical partnership was formulated on the grounds of a concept for the medium- to long-term future of Schott’s location in Mainz. Schott’s television glass segment is constantly exposed to fierce competition and price demands. For this very division Schott anticipates that the co-operation will enable a more flexible response to fluctuations in the economy, together with an optimisation of its entire logistical chain by referring to the competencies of the logistics specialist, and a relaxation of cost increases through innovative distribution concepts.
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Company Name Freight Links Express Holdings Limited Address: 51 Penjuru Road #04-00, Singapore 609143 Phone Number: 65 6262 6988 Email Address: Fax Number: 65 6262 6928
[email protected]
Website Address: www.freightlinks.net
Subsidiaries or Related Companies Freight Links Express Holdings (Australia) Limited Asset Focus: (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1981 Market Area: Founding Business: Asia
OVERALL CAPABILITY
Overall Capability of Provider: Capable 3PL with consolidation/deconsolidation emphasis.
KEY PERSONNEL
Eric Khua Kian Keong Henry Chua Tiong Hock Nancy Quek CEO COO Secretary Thomas Woo Sai Meng CFO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 54 54 * 1,000 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol FRTLIN Exchange: Singapore
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 5 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: 1.4 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 50000 Total Annual Airfreight Tonnes: >500
MARKETS
(For functional specializations, see "Customers" section.)
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe North America
Freight Links South/Latin America
EDITOR'S COMMENTS
Freight Links express is a major consolidator, deconsolidator and trans-shipment company. Its freight forwarding is done primarily through agents. CEO Eric Khua Kian Keong acquired an initial 2.6 million shares (direct holdings) of Freight Links Express Holdings on Feb 7 at 9 cents each. That was his first trade since his appointment in November 2003. That was also the first acquisition by a director or substantial shareholder of the company since 2003. Prior to that, substantial shareholder David Lim Teck Hiang disposed of 44.1 million shares from October 2003 to July 2004 via forced sales at 16.5 to 10 cents each, which reduced his direct holdings to 53.9 million shares or 6.5 per cent of the issued capital. The forced sales in October 2003 were initiated after the share price rose from 7.5 cents on Oct 3 to over 18 cents on Oct 10, 2004. Freight Links Express announced its interim results in December 2004 with net profit up by 81.8 per cent to $1.549 million for the six months to Oct 31, 2004. The stock closed at 9.5 cents on Friday. Provider's Strengths Operations and warehouses in key locations. Provider's Weaknesses Integration and control of overall operations. Maybe Kerry is the answer.
CASES & NEWS
Additional Comments: 1. General Freight Links Express Holdings Limited. The Group's principal activity is the provision of sea and air freight forwarding services. Other activities includes provision of warehousing and storage services, management consultancy and advisory services, investment holding services and logistics, archival storage and retrieval of corporate documents. The Group is also involved in the design and construction of exhibition stands and other related services. Operations are carried out in Singapore, North Asia, North America, Australia, Europe, ASEAN and others. Freight forwarding accounted for 69% of fiscal 2002 revenues; warehousing & distribution, 24% and others, 7%. 2. Operations. The company is registered in Singapore. Its main services are: International Freight Forwarding, Warehousing and Distribution, Exhibition Services and Moving Services, Document Management Services 3. Finance Profit for the six months to 31 October 2004 was US$ 0.945m. The share price appears to have varied quite sharply. Market capitalisation, can be calculated from information in a recent article where share price was quoted at 9.5 cents would be $48m Freight Links Express Group is one of the leading Logistics Management and Integrated Freight Forwarding Groups in Singapore. Since our establishment in 1981, our international freight forwarding business has been reaching to over 700 destinations throughout the world. Apart from strong strategic partnerships with over 120 freight forwarding agents worldwide, we have our own overseas offices situated in Malaysia, Australia and Hong Kong office serving as a gateway into China. We also own and operate an airfreight centre with bonded warehouses and office facilities in Melbourne through our Australian-listed subsidiary, Freight Links Express Holdings (Australia) Limited. In Singapore, our warehousing facilities occupy a total area of over 131,000 square metres. We have extensive experience in storing and forwarding all types of cargo, from small parcels to massive plant machinery, exhibition displays and archival documents. Our comprehensive array of logistics services includes inventory control management, warehousing, distribution, container and conventional transportation, freight forwarding and container freight station operations To enhance the efficiency of storage management, we are equipped with the technology advanced Automated Storage and Retrieval system (ASRS) with a capacity of over 31,000 pallets. We also utilize a web-based Warehouse Management System that enables all our customers with Internet access to view online inventory and cargo movement information anywhere and anytime. Moreover, as part of our commitment to the industry in the Electronic Data Interchange (EDI) network, we are subscribers to Tradenet, Portnet and Wise. Freight Links Express Group is able to provide effective, productive and well-coordinated total logistics solutions to local and foreign MNCs by harnessing information technology and automation. In the age of globalization, we strive to meet up with the challenges of being the leader in the logistics management and international freight forwarding business. Freight Links Express is a Total Solutions Provider that integrates customised logistics management. Multi-National Companies use Freight
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Links Express to out-source their logistics requirements. We specialise in managing the movement of cargoes in various shapes and sizes from small packages to heavy machineries and project cargoes of all shapes and sizes. The Freight Links Express Group offers the following services: international freight forwarding, warehousing and distribution, exhibition services, moving services, and document management services. International Freight Forwarding Freight Links Express (FLE) and Crystal Freight Services (CFS) offer international sea freight forwarding activities of the FLEH Group, with strong emphasis on sea freight forwarding activities. Services include: FCL and LCL consolidation, NVOCC, Transhipment, Project cargo management, Customers Documentation (portnet & tradenet), and Customized logistics Competitive advantages include: customer services, over 120 network of international freight forwarding agents worldwide, strong connections with major shipping lines to more than 700 destinations, and ability to offer cost effective routing and competitive freight rates. We provide comprehensive warehousing and distribution operations. Our warehousing facilities can accommodate a wide range of containerized and general cargo ranging from raw materials to finished goods. Services include: equipped with advanced inventory management system; stateof-the-art ASRS in secured and rack storage environment; provision for temperature & humidity control, supply chain solution; transportation and distribution; and handling, picking, packing, sorting, labeling and value-added services according to client's requirement and GST bonded facilities. The Group's Warehouse & Distribution Centres In Singapore include: Freight Links Express LogistiCentre - 250,000 sq ft; Freight Links Express DistriCentre - 250,000 sq ft; Freight Links Express DistriPark - 320,550 sq ft; Freight Links Express LogisticPark - 150,000 sq ft and Crystal Freight Services DistriPark - 84,000 sq ft.
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Company Name Geodis Address: Cap West, 7-9 Allees L'Europe, 92615 Clichy Cedex (Paris) France Phone Number: 33-1-56-76-26-00 Email Address:
[email protected] Fax Number: 33-1-56-76-26-26 Website Address: www.geodis.com
Subsidiaries or Related Companies Geodis-Calberson, Geodis-Cavewood Asset Focus: A Geodis-Teisa, Geodis-Vitesse Geodis-Zust Ambrosetti, Geodis-BM, France Express Rohde & Liesenfeld (A = Asset Based, N = Non Asset Based)
COMPANY BACKGROUND
Parent Corporation: Year Started in Logistics: 1995 Market Area: Founding Business: Int'l Transportation
OVERALL CAPABILITY
Overall Capability of Provider: Capable transportation company, contract logistics provider with a French focus.
KEY PERSONNEL
Pierre Blayau Francois Branche Marianne Maurice CEO & Chairman CEO Dir. Communications Alain Ferron Gilles Roux Finance
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 4,292 4,292 * 23,800 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol GEO Exchange: Paris, 2nd mkt.
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: 17,000 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 17,000 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 800 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Mostly Owned Warehouses/DC's: Mostly Owned 3.2 (Million)
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Automotive Oil & Energy Computers, Electronics Retailing Consumer Goods Technology
(For functional specializations, see "Customers" section.)
Healthcare Industrial
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Geode Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition Geode, SAP EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Geode Geode, Marc, SAP
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Alstrom Bayer BMW BP Amoco Disney IBM Imation Johnson & Johnson Lexmark LG Electronics
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Geodis Location
Europe
Industry
Industrial Healthcare Automotive Oil & Energy Retailing Computers, Electronics Technology Consumer Goods Computers, Electronics Consumer Goods
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
Europe
Europe
Europe
Philips Consumer Electro Computers, Electronics Siemens The Sharper Image Thomson/RCA Healthcare Consumer Goods Consumer Goods
Europe Europe
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COUNTRIES with OFFICES
Africa
All Countries
Countries served through owned offices or agents Australia / Pac.Isles
All Countries
Geodis North America
All Countries
Asia
All Countries
Europe
All Countries
South/Latin America
All Countries
EDITOR'S COMMENTS
Founded in 1995, Geodis is today France's largest provider of transport and logistics services and figures among the top European players in this sector. With revenues of over FRF20 billion and 25,000 employees, Geodis has operations in 40 countries worldwide through its subsidiaries, including Calberson, Cavewood, Teisa, United Carriers, BM, Geodis Logistics and Geodis Overseas. The group offers a complete portfolio of logistics and transport solutions, drawing on expertise from its four core businesses: parcel delivery (groupage), trucking, logistics and overseas freight. Geodis is short of profitability and heavily burdened by French socialisms. Provider's Strengths Broad offering. Provider's Weaknesses Needs a global identity and strong leadership to profitability.
CASES & NEWS
2006 First Quarter Turnover [via website] With two additional business days in France in the first quarter of 2006, Geodis increased revenue by 10.7% over the prior-year period. Geodis continued to achieve high revenue growth in the first quarter of 2006, posting a 10.7% increase over the prior-year period (8.9% comparable, like-for-like organic growth excluding changes in exchange rates). Revenue growth, continuing the trend of the latter months of last year, was magnified by the increased number of business days in the quarter relative to the first quarter of 2005 and by a favourable comparative base. Business in the first quarter of 2005 was sluggish. In France, where the calendar included two business days more than in the first quarter of 2005, revenue increased 7.9% on a like-for-like basis. Growth was strong as a result of high volume in Groupage, Express, and air and sea freight forwarding. Growth in Full Truckload operations had a new start as well. In Europe, like-for-like revenue growth reached 9.4% as a result of solid gains posted in Eastern Europe, as well as, to a lesser extent, in Ireland, Germany, and Spain. Revenue in Italy rose 5.1% in the quarter, primarily from air and sea freight forwarding. Asia continues to show strong growth: 38.4% for the quarter on a like-for-like basis driven by increasing export flows. These figures for the first quarter are not an indication for the rest of the year, however. The French calendar will have four fewer business days in the second quarter of this year than in 2005. Furthermore, the last quarters of 2005 posted progressively higher growth, providing a decreasingly favourable basis for comparison. Geodis and Thales In Cooperation The Logistics Chain: A Strategic Element to Accompany the Changes Taking Place in the Defense Sector On 8 March 2006, Geodis and Thales signed a partnership agreement relating to the defense sector; it will be the first of its kind. Their combined expertise in logistics chain management will meet the latest needs of the defense sector. This agreement strengthens the cooperation that already exists between Thales and Geodis in the form of their joint subsidiary TGFL (Thales Geodis Freight Logistics). The logistics chain represents an important element to accompany the changes taking place in the defense sector by targeting the efficiency of operations and reducing costs. A global approach to the different stages, the responsibility given to operators and the re-evaluation of the necessary technical resources allow optimized maintenance and assistance to the customer. This industrial, global and modular services offer accompanies the defense sector as it undergoes change. Drawing on their expertise in the management of complex projects, Geodis and Thales provide skills in the implementation and long-term maintenance of systems, together with end-to-end supply chain services. Together, Geodis and Thales will be in a position to act for military customers by defining comprehensive logistics chain plans, implementing SCOR-compliant processes, offering management services in stock, transport and distribution, and creating and operating information systems dedicated to flow management and traceability. Jean-Paul Lepeytre, assistant director general of Thales and director general of the Services division, explains: “this agreement strengthens Thales’ involvement to offer innovative and ever-more comprehensive services in response to the changing needs of our military customers." François Branche, CEO of Geodis, adds: “the services offered by our two companies will allow our customers from the defense sector to benefit from the know-how and best practice in defense and logistics that have been developed for all our customers worldwide." Geodis sees solid growth in 2005 [Transport Intelligence, January 30, 2006]
France’s largest logistics provider, Geodis, has provided a fourth quarter update on its trading in 2005 ahead of the publication of its full accounts. According to the statement, business remained strong in the fourth quarter of 2005, as turnover increased by 8.6% year on year. On a like-for-like basis this corresponded to organic growth of 6.3%. For the full year, Geodis expanded revenues by 6.7% to €3,595.7m with like-forlike growth of 5.5%.
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Operations in its home market, France, experienced growth of 5.4% as a result of high volume in the Groupage and Express Parcels businesses as well as in air and sea freight forwarding. As in the third quarter, however, turnover for Full Truckload operations saw only modest growth. Throughout the rest of Europe, Geodis achieved growth of 5.6% in the fourth quarter. This was attributed to higher volumes in Eastern Europe and commercial developments in the United Kingdom, Ireland, and Spain. The slowing rate of decline of turnover in Italy (-2.7% in the fourth quarter versus -6.6% in the half year ending June 2005) also contributed. Asia, with growth of 47.9% and 34.7% like-for-like growth for the full year, provided most of the increase in the company’s turnover in the rest of the world. Although the company’s release does not provide information on its profitability, the reasonably strong increases in revenue will be encouraging for management. The French economy has been particularly hard pressed in recent years with many logistics companies struggling with falling volumes. Geodis’ robust growth in its home market and the operations which it has established in higher growth markets such as Eastern Europe and Asia should see it poised for solid expansion in 2006. Geodis Becomes Thomson’s Sole Service Provider [via website, October 7, 2005]
Geodis wins a new Pan European contract with Thomson Continuing the partnership that has linked the two groups for the last 6 years, the Geodis group has just won an important logistics and distribution contract with Thomson. This new three-year contract involves the distribution of finished products (audio and video) throughout Western Europe: France, Italy, Spain, Germany, Benelux, Great Britain, Switzerland (excluding Scandinavia). Distinguishing itself from its competitors by the quality of its technical bid and a more competitive budgetary approach, Geodis becomes Thomson’s sole service provider in Europe in respect of logistics for audio and video products. In order to handle these volumes, in addition to its warehouses in France (Evry), Italy (Grezzago) and Spain (Cabanillas), Geodis plans to build a new 20,000 m² platform in Germany (Malsfeld) before the end of the year. This European distribution from Geodis’ warehouses, which is accompanied by the provision of services on the Asia/Americas/Europe logistics flows, allows Geodis to strengthen its position as the major player in the Thomson Supply Chain. Geodis thus meets a growing need on the part of industrialists in the High Tech sector, seeking totally reliable flow control solutions with extremely short lead-times and at optimum possible cost. Geodis Opens a Logistics Pole in Lipetsk [via website, October 4, 2005]
Indesit Company and Geodis open a logistics pole of 53,000m² in Lipetsk, Russia Following May 2004's signing of a logistics contract in Hungary, Italian group Indesit Company has renewed its trust in Geodis and delegated management of its 53,000m² post-production warehouse in a new logistics park in Lipetsk, 450km south-east of Moscow, to the French company. The site was officially opened today at a ceremony attended by Mikhail Fradtkov, Prime Minister of the Russian Federation, Gianfranco Facco Bonetti, the Italian Ambassador, and Vittorio Merloni and Andrea Sasso, respectively Chairman and CCO of Indesit Company. "At 53,000m² it's probably the biggest single-customer platform in Russia," commented Christopher Hogg, Sales and Marketing Director at Geodis Solutions. "This contract is representative of Geodis' strategy in Russia, which is to develop activities involving logistics, domestic and international transport (between Russia and other European countries, such as Turkey) and industrial projects. Our goal is to win new contracts and naturally to partner our key customers from the automotive, consumer, retail, manufacturing and cosmetics businesses who want to reorganise their pan-European logistics activities." GEODIS APPOINTED BY CARREFOUR KOREA [via website, October 11, 2005]
Geodis Solutions Asia has been appointed by Carrefour Korea to manage its 30,000 square meters distribution center in Icheon (south of Seoul) and Nationwide distribution to its 31 stores for their dry products activity. The agreement includes the signature of a two-year storage and distribution contract, thus extending the partnership between the two companies to manage Carrefour’s operations in Indonesia, which started in March 2005. Alain Chimene, Corporate Director of Geodis Solutions Asia said: “This is a major step for Geodis. This partnership brings Geodis Asia to a new level and gives our potential customers a true alternative to the long established logistics providers.” Geodis announces AsPac contracts [Transport Intelligence, May 23, 2005]
Geodis has announced a number of new contracts in Malaysia and Indonesia. It was contracted last year by a subsidiary of German retailer group Metro to establish a 12,000m² warehouse in Tanjung Pelepas, a port area recently created in southern Malaysia. The seasonal 6-months contract employed sixty staff. From October 2004 to March 2005, 2,500 containers of garden furniture (tables, chairs, barbecues, etc.) were delivered to Tanjung Pelepas from other Asian countries. Geodis received and checked the goods and picked orders for Metro's 268 European retail outlets. The containers are then shipped to Rotterdam and forwarded by road by Geodis Vitesse to the relevant stores. Geodis has also signed a 3-year domestic transport services, storage and maintenance (tyre pressure, battery checks, etc.) of Mercedes-Benz passenger vehicles (E, C and S-Class) manufactured in DaimlerChrysler Malaysia’s factories in Pekan (north-east Malaysia) and Petaling Jaya (Kuala Lumpur). Meanwhile in Indonesia Carrefour has chosen Geodis to manage its storage and domestic distribution services. Geodis will begin managing two logistics platforms in Cibitung (Jakarta) in March. One facility, with a surface area of 2,000 m², will be dedicated to storing local or imported products and the other, 5,000 m², will provide cross-docking services and distribute products to 13 Carrefour stores in Indonesia.
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Company Name Hammond Logistics Group Limited Address: 6 King Edwards Court, King Edwards Square, Sutton Coldfield, West Middlands B73 6AP UK Phone Number: 0800 0284021 Email Address:
[email protected] Fax Number: Website Address: www.hammond-logistics.co.uk
Subsidiaries or Related Companies Asset Focus: N
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Bibby Distribution U.K. (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1959
OVERALL CAPABILITY
Overall Capability of Provider: Good U.K.-based contract logistics operator and distributor.
KEY PERSONNEL
John Cutler Helen Firth Philip Smith CEO Marketing CFO
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 78 78 * 600 22 3 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: 300 Total Trucks: Total Other: 350 50 Total Transportation Assets: Total Tractors: 300 Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: 350 350 Total Warehouses & Distribution Centers: Total Warehouses/DC's: 15 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: Asset Ownership v.s. Leased: Transportation Equipment: Leased Warehouses/DC's: Leased 0.75 (Million) 6
Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other:
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: Total Annual Airfreight Tonnes:
MARKETS
Food, Groceries Plastics, Fibers Automotive Beverage
(For functional specializations, see "Customers" section.)
Food, Groceries Paper
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition SAGE Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling Proprietary Proprietary
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: Lutterworth Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Antalis Aria Foods Braitrim Budweiser DS Smith IM Group Kellogg's Nestle SCA Suzuki Toyota
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Hammond Location
UK UK UK UK UK UK UK
Industry
Paper Food, Groceries Plastics, Fibers Beverage Paper Automotive Food, Groceries Food, Groceries Paper Automotive Automotive
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
UK UK UK
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COUNTRIES with OFFICES
Africa Asia
Countries served through owned offices or agents Australia / Pac.Isles Europe
United Kingdom
Hammond North America South/Latin America
EDITOR'S COMMENTS
Hammond is a solid automotive 3PL with modern skills. Provider's Strengths Transportation, inventory management. Provider's Weaknesses Limited to U.K.
CASES & NEWS
Bibby Acquires Hammond Logistics [via website, April 3, 2006] Bibby Distribution, the largest private family owned logistics company in the UK, has acquired Hammond Logistics Group, bringing together two of the industry's best known and respected operators. The move will strengthen Bibby's position in the logistics marketplace, bringing turnover to £160m, extending infrastructure to include 60 locations nationwide and a fleet in excess of 1000 vehicles. According to Theo de Pencier, Managing Director of Bibby Distribution, Hammond Logistics represents a perfect fit for Bibby, whose ambitious expansion strategy has seen the company double in size and increase in profitability over the last five years, with plans to double again within the next five years. "Bibby is already in the top ten logistics companies in the UK and the Hammond acquisition will close the gap, putting pressure on our nearest competitors," he says. "Hammond represents the perfect fit for us in that it is a privately owned company, with a culture that reflects our own - providing flexible, customer-centric solutions flowing from an agile, responsive management team able to make decisions rapidly." John E.Cutler, Chief Executive Officer of Hammond Logistics, which will become a wholly owned subsidiary of Bibby Distribution, stated that the acquisition will provide long term stability for Hammond and points out that the synergy between the two companies will ensure 'business as usual' for Hammond customers. "Operationally, our customers will perceive little impact," he said. "Hammond will continue to provide the same professional, reliable service but if anything we will now be able to offer more flexibility than ever with an improved network of depots and an increased fleet of vehicles The news has already been met with very positive response from our customers." Crucially, Hammond meets Bibby's key acquisition criteria, delivering customer/sector synergy and extending supply chain capability. Hammond's market leading IT systems represent an important gain for Bibby, whilst their network of depots neatly complements Bibby's own, with very few areas of cross over. Similarly, the merging customer bases are broadly complementary. Bibby is very strong in the food and drink sector, counting Kelloggs, NISA Today's, Budweiser, First Milk and Sainsbury's amongst its key customers, whilst Hammond's expertise in the automotive sector - high profile customers include Toyota, International Motors and Suzuki - provides Bibby with an excellent platform for growth in the sector. Hammond's IKEA business will broaden Bibby's FMCG retail portfolio, whilst accounts in the paper & packaging and plastics & chemicals sectors will serve to diversify the overall Bibby customer base. The acquisition of Hammond has been the largest Bibby has yet undertaken, and has been described by Theo de Pencier as 'the most exciting move we have made to date'. Commenting on the acquisition, Theo de Pencier concluded, "Hammond shares with Bibby a commitment to developing core relationships, building customers and contracts. Like us, they have a tradition of giving key managers the responsibility and autonomy to make the right decisions for customers, and their reputation is founded on offering an alternative solution to the bureaucratic framework that characterises our largest logistics competitors. These elements, together with Hammond's expertise and logistics intelligence, will have significant impact on the future development of our business, particularly in the automotive sector where Hammond enjoys high credibility and an excellent track record. Operational synergies, as well as service and cost synergies, are already beginning to emerge, which will enable us to improve our services to the benefit of all our customers." John E.Cutler added, "Bibby Distribution has a policy of acquiring strong, successful, well-run companies, and as the two companies have already worked together in the past on joint projects, they know Hammond well. I believe that this acquisition makes the Bibby brand bigger, stronger and more diverse; our shared aim now is to take the merged business forward more strongly than ever." Customer Ikea is a high profile Swedish Retailer of Furniture, famous for its cutting edge design and value for money. Sales for the IKEA Group for the financial year 2004 (1 September 2003 - 31 August 2004) totalled 12.8 billion euro (15.5 billion USD). The UK, with 12 locations nationwide, made up 12% of the total sales. Challenge Ikea is dedicated to its ongoing strategy to develop significant home delivery operations. To improve flow, and take volume away from stores, Ikea embarked upon a programme of Home Delivery and Customer Distribution Development. Their objective was to maintain high service levels whilst continuing to deliver value for money. Solution
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Ikea stores were established as the epicentres of a prescribed territory, with concentric rings created around them within which a home delivery service would be a cost effective option. Jerry Ryan explains: “It was important to us to identify logistics partners with comprehensive geographical knowledge of an area and empathy with local people, Previously we had two major logistics operators on board, which worked respectively on the Customer Distribution side and one on Home Delivery, but we decided that to support our stores locally, we would divide our network into areas and offer exclusivity to one operator within each area…Ultimately we chose to work with Hammond” Hammond was awarded central customer deliveries for the southern region. Hammond handle the Home Delivery side, taking possession of customer goods at the store, charge for delivery and consignment costs and transport consignments from the store to the Distribution Centre. Thereafter they arrange for the goods to be delivered at the convenience of the customer. Ikea also operate am on site Customer Services division to give support, advice and information to IKEA customers who take advantage of the Home Delivery Service. The whole process is underpinned by Hammond’s market leading IT systems, which have been tailored to meet IKEA’s specific Home Delivery requirements, and gives them real time information on the status of customer deliveries, easily accessible on the web. Customer Toyota is a household name worldwide as one of the leading automobile manufacturers, the UK being a key market in terms of both manufacture and sales. Toyota is well known for their “Kaizen” principles of constant improvement and exceptional customer care and service Challenge Toyota GBs car sales have seen unmitigated growth in the last decade, and in line with this rapid expansion, the after-sales parts service has had to keep pace. Rather than move to a bigger site, Toyota needed a fully dedicated logistics solution. With a total of 260 UK dealerships, Toyota needed to be sure that stock was delivered on time every day in order to minimize the volume of safety stock that was held in the warehouse. Operations needed to remain agile whilst at the same time being able to handle the company’s growth. Solution From a central office based within Toyota’s Lutterworth Central Distribution Centre, Hammond operate in excess of 30 vehicles that are allocated to both trucking and milk run delivery routes to outbases spanning all of the UK. The routes are worked out on an Olympic circles basis, with dynamic planning being carried out as necessary at the cross over points. Drawbar combinations are used, and at each outbase the bodies are demounted in order to leave the load untouched when placed onto smaller delivery vans. The stock is then delivered to unmanned lockups where the drivers unloads and deposits the stock before 8.30 am, being sure to check for any discrepancies using a barcode system. Hammond is also responsible for interbranch exchanges, in the event of one branch selling goods to another. Hammond uses outsourcing in order to carry out ad hoc runs, such as moving particularly heavy objects quickly and efficiently. A same day delivery service is operated nationwide on behalf of all Lexus dealerships to fulfill orders made before midday.
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Company Name Hellmann Worldwide Logistics, Inc. Address: 10450 Doral Boulevard, Doral, FL 33178 USA Phone Number: 305-406-4500 Email Address: Fax Number: 305-406-4519
[email protected]
Website Address: www.hellmann.net
Subsidiaries or Related Companies Asset Focus: N
COMPANY BACKGROUND
Parent Corporation: Market Area: Founding Business: Hellmann Worldwide Logistics GmbH Int'l Transportation (A = Asset Based, N = Non Asset Based) Year Started in Logistics: 1871
OVERALL CAPABILITY
Overall Capability of Provider: Capable freight forwarder and contract logistician.
KEY PERSONNEL
Karl Weyeneth Ian Beckman James Parker CEO, Pres. Americas Sr. VP Bus. Dev. & Mktg. Sr. VP & COO Dieter Kasprzyk Mayra Regalado EVP & CFO Sr. VP MIS
FINANCIAL INFORMATION (FY 2005)
Total Logistics Revenue ($Millions): Total Net Logistics Revenue ($Millions): Total Logistics Employees (Including Drivers): Total Long-Term Contracts Held: Average Length of Logistics Contract (Years): 2,600 520 * 6,000 150 3 * (Net Logistics Revenue is net of pass-through revenues for purchased transportation.) Ticker Symbol Exchange:
ASSETS
Dedicated Contract Carriage Power Units/Trucks: Total Tractors: Total Trucks: Total Other: Dedicated Contract Carriage Trailers: Total Dry Van: Total Reefers: Total Flatbeds: Total Tankers: Total Other: Total Transportation Assets: Total Tractors: Total Trucks: Total Trailers: Total Aircraft: Total Ocean: Total Other: Total Warehouses & Distribution Centers: Total Warehouses/DC's: 315 Total Square Footage: Total with Rail Doors: Avg Truck Doors per DC: 6.1 (Million) 16
Asset Ownership v.s. Leased: Transportation Equipment: Warehouses/DC's: Leased
FREIGHT FORWARDING/NVOCC VOLUMES
Total Annual TEUs: 200000 Total Annual Airfreight Tonnes: >1000
MARKETS
Automotive Retailing Beverage
(For functional specializations, see "Customers" section.)
Computers, Electronics Entertainment Heavy Equipment
INFORMATION SYSTEMS
Overall Information Systems Rating: C (E=Excellent, G=Good, C=Capable/Adequate, and I=Inadequate) Software Vendor/Brand: Software Type: Transportation Management System (TMS): Proprietary Transportation Planning and Optimization: Warehouse Management System (WMS): Network Modeling/Site Location: Freight Bill Audit/Payment Software: Order Management System: Other Systems Capabilities: Bar Coding Demand & Supply Forecasting 14th Edition LFS Proprietary Proprietary Proprietary EDI Handling ERP Interfaces Integrated TMS & WMS Internet Customer Access Radio Frequency Devices Real-time Track & Trace XML Data Handling
TMS Optimization Routines: End-to-end Matching/Continuous Moves Mode Conversion/Optimization Many to Many Supply Network Optimization
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TRANSPORTATION MANAGEMENT SERVICES
Transportation Planning Carrier Mgmt and Contracting Inbound Shipment Planning Outbound Shipment Planning End-to-end Load Matching Mode Conversion/Optimization Transportation Execution Contract File Maintenance Exception Handling Load Tendering Loss/Damage Claims Tracking & Tracing Freight Bill Payment: Pre-Audit Post-Audit Performed In-house Outsourced Transportation Services Air Freight Forwarding Consolidation/Deconsolidation Dedicated Contract Carriage Freight Brokerage Home Delivery Less than Truckload (L.T.L.) Ocean Freight Forwarding Rail Rail TOFC/COFC Small Package Specialized Truckload
WAREHOUSING & VALUE-ADDED SERVICES
Warehouse/Distribution Center Facilities Mgmt Frozen Value-Added Services Call Centers Cross Docking Customization Inventory Control/Vendor Mgmt KanBan Refrigerated Kitting Labeling Lot Control Merge in Transit Manufacturing Support Rail Siding Pick/Pack Pool Distribution Repair/Refurbish Returnable Container Mgmt Reverse Logistics Store Support/Direct Store Delivery Sequencing/Metering Specialty Packaging Sub Assembly
OTHER 3PL SERVICES, SKILLS & HANDLING
Other 3PL Services Consulting/Process Reengineering Factoring/Financial Services Installation/Removal Order Mgmt Purchase Order Mgmt Project Logistics Quality Control Union Services
Special Skills & Material Handling Bulk Commodities Hazardous Materials ISO Certified Certification Locations: All Other Services:
Food Grade/Sterile
Temperature Controlled
INTERNATIONAL SERVICES & PRIMARY AREAS SERVED
International Services AES/AMS/C-TPAT LCL Consolidation Customs Brokerage Duty Drawback Foreign Trade Zone NVOCC Areas Served Africa/Middle East Asia/Pacific Australia/New Zealand Europe Latin America North America
CUSTOMERS
A sample of 3PL clients. Customer
Abercrombie & Fitch Bacardi Martini Bang & Olufsen Caterpillar Inc. CNH Corp. Dana Corporation Federal-Mogul Norwegian Cruise Line Sony
TM-Transportation Mgmt WM-Whse/DC Mgmt VA-Value-Added DCC-Dedicated Contract Carriage Inte-Integrated TM&WM IM-Intermodal Intl-International SCM-Supply Chain Network Mgmt. Lead-Lead 3PL
Services Rendered by Hellmann Location
Columbus, OH Miami, FL Chicago, IL Miami, FL Chicago, IL Chicago, IL Indianapolis, IN Miami, FL; Los Angeles, CA Miama, FL
Industry
Retailing Beverage Computers, Electronics Heavy Equipment Heavy Equipment Automotive Automotive Entertainment Computers, Electronics
TM
WM
VA
DCC
Inte
IM
Intl
SCM
Lead
Other
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COUNTRIES with OFFICES
Africa
Angola Botswana Burundi Cameron Congo Mauritius Nigeria Rwanda Senegal South Africa Sudan
Countries served through owned offices or agents Australia / Pac.Isles
New Zealand Papu New Guinea
Hellmann North America
Bahamas Canada Caribbean Cayman Costa Rica El Salvador Guatemala Honduras Mexico Puerto Rico United States
Asia
China Hong Kong India Indonesia Japan Korea Malaysia Phillippines Singapore Taiwan Thailand
Europe
Belgium France Germany Italy Netherlands Portugal Russia Scandinavia Spain Switzerland Ukraine United Kingdom
South/Latin America
Argentina Chile Brazil Peru Venezuela Uruguay Ecuador Paraguay Bolivia Columbia Panama
EDITOR'S COMMENTS
Hellmann is a good international freight forwarder with contract logistics spread around the globe. Coverage in Asia and China is good. Hellmann is a privately held German company. Provider's Strengths Provider's Weaknesses
CASES & NEWS
Hellmann Worldwide Logistics Delivers Communications Infrastructure to Iraq IF WALKING OR DRIVING TODAY IN IRAQ IS DIFFICULT, TRANSPORTING CARGO IS EVEN A BIGGER CHALLENGE Miami, May 12, 2004 – Hellmann Worldwide Logistics, one of the world’s largest privately owned global logistics providers, is transporting oversized and sensitive communications equipment from the USA to Iraq, not withstanding the current lack of infrastructure at destination. The equipment, manufactured by DataPath Inc., was a Deployable Ku Band Earth Terminal (DKET) designed to provide worldwide communications, via-satellite voice and data connectivity, to expeditionary contingents operating in locations lacking telecommunications infrastructure. Several units of this mobile communication center are currently deployed in Baghdad in support of U.S. operations and at the service of the U.S. Department of Defense. The load came from various suppliers in Texas and Georgia, continuing on to Kuwait where it cleared customs. Due to freight service limitations in the area, it was trucked to the U.S. Military Base in Baghdad. Hellmann managed the security issue by utilizing U.S. Military and Private Security Convoys on secure routes from Kuwait. Hellmann’s global presence and its implementation of the most advanced technology ensured a seamless delivery process within eight days. Hot market, cool freight [by William Hoffman, The Journal of Commerce, April 17, 2006]
In just the last few years, vendors, carriers and logistics providers formed their first trade group, launched innovative specialty products and witnessed surging industry demand for “cool” supply-chain services. “Logistics is the big challenge now,” said Steven Boyd, director of sales and marketing for AmSafe Bridport and director at large for the CoolChain Association, founded by airfreight carriers and others in 2003. Raul Villavicencio, vice president for business development at Hellmann Perishable Logistics, heard the call. His company is testing packaging that will allow better long-distance transportation of perishable foodstuffs by air and sea. “If you’re not innovating in this industry, you’re most likely dying,” Villavicencio said. “If we’re not in the forefront of things, somebody else will be.” AmSafe, a manufacturer of crew and passenger-restraint systems, plans to introduce a “flying Freezer” this summer, Boyd said. “Whether it’s ours or any other container, it’s all about having the right amount (of containers) at the right place at the right time. An airline does not want to haul air.” Temperature-sensitive shipping Boyd estimated, is growing at a rate of 15 percent of the air-cargo industry, the largest single category of airborne goods, though rising fuel costs are pushing more cool cargo shippers to ocean transportation. The new containers may help the budding demand for refrigerated transportation via ocean carriers, Boyd and Villavicencio said. “The fuel surcharge has been rising and rising and rising to no end,” Villavicencio said. “If it continues this way, the surcharge will cost as much as the freight.” That trend, combined with better temperature-control technology, makes ocean transport more attractive. Instead of flying Peruvian asparagus direct from Peru to Europe, Hellmann is considering shipping the produce via ocean to Miami and then to Europe by air. Even after accounting for additional days in transit, with superior technology Hellmann estimates it could save 10 percent in freight costs. Cool chain transportation and logistics providers have invested heavily in technology to expand their business. Hellmann operates a fully wireless, bar-code-enabled Miami warehouse with visibility to its shipping customers. Boyd said early association members included not only air carriers but also container suppliers, pharmaceutical companies and radio-frequency identification vendors. Yet technology is not a panacea for the growing cool chain sector. Villavicencio said cool chain shippers and providers are spending more on training and personnel. “It is our job not to lose touch with the customer, otherwise the customer gets used to dealing with a (computer) interface.” The Cool Chain Association was founded with the goal of standardizing procedures, training, communication and measuring criteria for a seamless perishable supply chain. The need is glaring: The group estimates 30 percent of all perishables – food, pharmaceuticals, artwork and
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microchips are lost in transit. “We want to reduce that, come up with some industry standards, Boyd said. Most of the demand for cool chain services comes from food shippers. Hellmann is testing active and passive Gen 2 RFID at the case level to monitor temperature and environmental conditions as products move from airports to planes to customers to warehouses and finally to consumers. “We tested from Chile because it’s the farthest point that we get perishables into Miami right now,” Villavicencio said. Miami received about 70 percent of U.S. perishable shipments between 2000 and 2004, he said. Hellmann also is experimenting with new packaging it hopes will allow it to ship horse meat and eventually seafood produce fresh from its operation in Dallas to Frankfurt and then Zurich for distribution throughout Europe. Villavicencio said Hellmann hopes the new packages will reduce his company’s reliance on pricey Envirotainer containers, saving as much as 30 percent in freight costs alone. “The industry now is beholden to Envirotainer for transportation of temperature-sensitive goods,” Boyd said. HELLMANN WORLDWIDE LOGISTICS ACCELERATES CHINESE EXPANSION Miami, October 4, 2004 – Hellmann Worldwide Logistics, one of the world’s largest privately owned global logistics providers, has announced an over US$6 million development plan to better serve its customers in the Chinese market. The plan includes the opening of a new Airfreight facility in Shanghai this month, the addition of four offices to augment the 30 existing offices currently operating in China and 100% ownership of its joint venture in mainland China. Customer requirements have motivated the company to become a leader in the market with a highly modernized, secure and efficient warehousing concept. Maintaining top quality and design in the construction of the company’s new Shanghai Airfreight warehouse was the central objective and has set a new benchmark for warehousing and logistics operations in the Chinese market. Hellmann’s ambitious project in Shanghai’s New Pudong Airport Bonded Area will provide 6000 squared meters of warehouse space and over 2000 squared meters of office space. It will also house a temperature-humidity controlled Garment on Hangers (GOH) area, a static-free, high security compound, a partially automated airfreight pallet loading system, and an additional 2300 squared meters of covered loading area with Close Circuit TV (CCTV) coverage. Paperless Logistics Solution for Textile Industry HELLMANN WORLDWIDE LOGISTICS IMPLEMENTS ARCHIVING SOLUTION FOR ABERCROMBIE & FITCH INTRODUCTION Today, with globalization blooming and the industry constantly chasing lower labor costs around the globe, the apparel industry is facing increased trade and broken barriers. As a result, the industry must look for new and more challenging logistics solutions. Hellmann Worldwide Logistics, one of the world’s largest privately owned global logistics providers, recently introduced a technology-based archiving solution to assist one of the company’s clients: Abercrombie & Fitch (A&F). ABERCROMBIE & FITCH’S NEEDS The U.S. Customs & Border Protection, under the Customs Modernization Act (Mod Act), amended its sections of the Tariff Act of 1930 dealing with recordkeeping requirements. The rules demand that the records for the maintenance of merchandise coming into the country be kept for five years. As multiple documents are required for consumption entry of textile merchandise imported into the United States, the large textile importers must have large storage retention areas at their disposal. Not only can this become complicated with such an abundance of paper, but it can also be very costly. This price increase would result from the loss of manpower incurred by searching for documents, as well the excessive cost of document storage. The risk of misplacing documents is yet another factor that could result in huge penalties by U.S. Customs. One of Hellmann’s largest textile customers, Abercrombie & Fitch, is currently being offered the latest in airfreight and seafreight transportation – both port to door, customer brokerage, duty drawbacks, re-export of products not meeting A&F’s quality standards, and customs clearance in multiple U.S. entry ports. Additionally to these services, A&F requested that they create an archiving solution to aid them in the enhancement of their compliance management program. Hellmann responded by introducing them to an electronic infrastructure that would eradicate all paper documents, enabling the partnership to be 100% paperless on all customs brokerage transactions (from document entry to electronic invoicing to the downloading of all their customs data). Hellmann Worldwide Logistics did not offer the archiving product in the United States, but in Germany, where it was used for various customers such as Köster Bau, Wessels & Müller, Continental, Olympia, Intersnack, etc. Hellmann’s German programmers were not educated on the U.S. Customs compliance rules and regulations; therefore, it was necessary to provide training and work closely with the programmers to ensure that they understood how to successfully satisfy Abercrombie & Fitch’s needs in the U.S. SOLUTION The archiving solution would cut back on the number of fines, penalties and violations that could potentially be assessed by U.S. Customs. The ultimate goal is for the system to automatically transfer data to the archive application. This method will not only reduce the cost of manpower, but also enhance data entry integrity. Hellmann is currently working on a barcode system that will allow Abercrombie & Fitch to retrieve all necessary search criteria from the operational databases, rather than inputting this information manually. Hellmann Worldwide Logistics handles the scanning process on behalf of Abercrombie & Fitch, where there are Hellmann employees assigned exclusively for A&F. RESULTS The strategy implemented by Hellmann Worldwide Logistics provided Abercrombie & Fitch with a significant reduction of costs in storage and manpower. “The imaging process has been a tremendous improvement for Abercrombie & Fitch,” expressed Laura Noonen, Compliance and Trade Manager for Abercrombie & Fitch. “It has allowed us to spend at least 15-20 extra hours every week on improving our post audit process. This has contributed to a 50% reduction in SILs (Supplemental Information Letter), based on monthly average in dollars.” The Abercrombie & Fitch solution, as Hellmann’s first customer, could be the initial application for many others to follow. The archiving
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infrastructure is currently being modernized to improve efficiency, increase storage capacity and enhance scalability. In addition, system and user administration will be made easier and more flexible, with redesigned user access on the web. Hellmann currently offers a similar service to Federal Mogul, and is very much prepared to serve other clients as well across industries.
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