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Strategic Partnering That Works

Doug Martin

President and Chief Executive Officer

Commercial Cold Storage, Inc

Strategic Partnerships. Third Party Logistics. Strategic Alliances Outsourcing. Supply Chain Management. These are some of the current buzzwords in our industry indeed, with most enterprises in the world that are charged with moving goods from point A to point B in the right quantities of the right items from the right origin to the right destination in the most cost effective and efficient routing that provides the best service and on time delivery as possible. No problem - right? Well, maybe a little one.

We hear lots of talk about companies advertising that they provide these types of services. But do they really and are they truly cost effective? The dry goods industries have been providing these kinds of services for years. The frozen and chilled food industry is now attempting the same.

In these days of industry consolidation, it seems the best solution in distributing goods efficiently is to survey the market looking for those warehousing, distribution and logistics providers that can perform these services effectively. This would include selecting the provider that can best accomplish this mission - regardless of corporate structure, multi-locations and 'umbrella' promises. Site optimization studies that are pure asset utilization driven by the logistics provider are not truly objective. What's that they say about putting all your eggs in one basket? The model might look good on paper but if the core competencies of doing the 'right' things listed above are not accomplished, then the best models in the world cannot compensate for the inability to get the right product in and out of the warehouse as ordered to the end user.

Commercial Cold Storage in Atlanta, Georgia has been fortunate in being able to offer strategic partnering in the supply chain that works. This has included racking multi-temperature space to customers specifications, integrating inventory control into the customers' database system, and providing mechanisms for third party outsourcing of transportation through freight and warehouse management systems and storage as well as sales functions for the customers.

Customers generate purchase orders to vendors and when the trucks arrive at Commercial, the customers' systems print out bar coded labels which are stickered to each case as they are going to storage. The customers then scan the product into their inventory control system using radio frequency and we warehouse the items based upon the bar coded location that is scanned from the customers systems. Since the warehouse locator system has been laid out consistent with the customers' own warehouses out of state, it makes it easier to locate product because we are using the customers' own in house location systems for consistency and uniformity.

When orders are generated, we replenish where necessary, pull the thousands of line items selected, pre-stage the orders and then bring the orders out to the customer where the product is scanned to relieve inventory from their system and consolidated onto waiting trucks. Their system is used to bill their customers and is the basis of our billing for services rendered. We are on site with the customer and are jointly linked into a strategic partnership providing logistics services. Through the efficiencies of this system, chilled and frozen foods have an average turnover of seven days or less using Just In Time Best Practices. This service had been tried at other locations but moved to us because of the proven performance of what we do best - get the right product to the right customer, damage free, and on time.

Now we are in the process of creating a data warehouse assimilator which can capture data from other storage points throughout the country, provide inventory and transaction information and coordinate orders from various distribution centers for shipment to the ultimate customer.

The moral of the story is to select the best provider of all services combined in each region where you want market presence that can offer an objective solution to your logistic opportunities.
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Article Details
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Author:Martin, Doug
Publication:Frozen Food Digest
Geographic Code:1USA
Date:Apr 1, 1998
Previous Article:N.G.A. and FDI will continue to explore alliance.
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