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Cleaning products distribution - a logistical challenge23rd of September 2013
Logistics are a vital element of any distributor’s business. Ann Laffeaty asks distributors how they manage to store, load and deliver their products in the most cost-efficient possible way in a marketplace that is becoming more competitive all the time.
The term ‘logistics’ originated in the late 19th century when it referred to the military’s need to supply itself with arms, ammunition and rations when moving from a base to a forward position.
It is now used to refer to any supply chain where a company needs to manage the flow of resources between the point of origin and the point of consumption to meet the customer’s requirements.
This is all a rather elaborate way of describing the necessity for moving goods from A to B. But in a business where time is money, products need to be stored economically and ergonomically in a way that will not allow them to lose their value. These products also need to be loaded on to lorries efficiently in order to take up as little room as possible, and taken to their final destination in a cost-efficient way to avoid wasting fuel and journey time.
And all this needs to be carried out in a sustainable fashion while also meeting customers’ demanding deadline requirements. So, not as easy as it sounds.
But logistics are an important factor in the success of any distributorship – and new challenges are emerging all the time according to sales director of CJS Portsmouth Keith Churchill.
“Customer expectations seem to be constantly rising and that puts more pressure on the distributor,” he said. “Today’s customers don’t want to have to hold on to any extra stock - they want us to store it for them and deliver it to them as and when they need it. And that means we need to make more deliveries.”
He says the company works around this by increasing the efficiency of its operation. “We try to avoid empty leg journeys and we have designated delivery days for each customer,” he said. “We also use a sophisticated computer system to ensure we always have the right stock and it can be delivered on time to the right customers. We are constantly upgrading this system.”
According to Churchill another logistical problem concerns the fact that many cleaning and hygiene manufacturers offer a number of products bearing the same brand name and housed in similar packaging. “Even though these products will have different article numbers, they often come in boxes that all look the same,” he said. “It can be very confusing and it makes it difficult for us to distinguish between the products when storing them in our warehouse.”
Director of Smith and Coburn Glen Smith agrees with Churchill that today’s customers are increasingly requiring just-in-time deliveries. “It means your operation has to be very slick,” he said. “One of the major challenges is to find the right balance between speed, sustainability and cost-effectiveness. We try to avoid ‘empty leg’ journeys and fill lorries as much as possible, but how many customers will wait a day until the vehicle is in the area in order to avoid additional fuel costs and carbon emissions?”
He says the company uses up-to-date IT solutions and an efficient operating platform to help streamline its logistics.
“In terms of packaging, concentrated chemicals are the way forward since these necessitate fewer trips and more margin,” he said. “Robust packaging is also important, and packs that bear barcodes help to improve logistical efficiencies.”
As distribution businesses become increasingly international, Smith claims that such efficiencies will help to keep companies solvent. “A robust IP platform - both customer-facing and internally - coupled with slick operating procedures and a good quality courier will help international distribution,” he said.
Spot On Supplies places emphasis on sustainability and service in its own logistical operations. The company organises its deliveries by allocating specific drop-off days for each customer.
“We don’t offer a 24-hour delivery service since we find that doesn’t work very well from a sustainability point of view,” says the company’s marketing manager Ben Raban. “In a 24-hour operation you may have to divert a lorry from one end of your region to the other just to drop off one delivery – and this increases your carbon footprint.”
He says the direct contact between drivers and end-customers is a key element of any logistical operation. “The drivers act as the eyes and ears of the company and if there are any problems or complaints, they can tell us straight away.”
Director of Netherlands-based distributorship Exclusiva Simon van Dijk agrees that the direct contact between the customer and the distributor’s own staff plays a major role in the success of logistics. “It gives the customer confidence and facilitates faster communication when resolving any inaccuracies,” he said. “The end result is a better service.”
He says high fuel costs, traffic congestion and the inaccessibility of some customers’ premises are among the chief logistical challenges facing distributors today. Exclusiva relies heavily on computer technology to plan its logistics.
“Each order is scheduled and inserted directly into our computer programme,” said van Dijk. “Our route planning takes into account the size of the packaging and the route we should take, and the planning module then considers the volume of the product and the weight of the car. This allows us to choose the right vehicle for the specific task.
“Vehicles are then loaded in a compact fashion to avoid any wasted space, and the programme is run in a loop to prevent the return of an empty car. “
According to van Dijk, distribution networks will become increasingly international in the future. “However, local distribution networks will remain important in cities,” he adds.
MTS is building a new logistics centre in order to help the company provide a continuous supply of products to its customers as and when these are needed.
“With this approach we aim to improve our service, efficiency and delivery performance while minimising the risk of disappointing the customer due to products being out of stock,” said export manager Diana van Nimwegen.
MTS delivers from a network of logistics centres and takes care of all deliveries to the Benelux region while outsourcing transport to other European countries. “We use our transport network to strengthen relationships with our customers in Belgium and the Netherlands,” says van Nimwegen. “Retaining contact with our buyers in these countries is one of the key reasons why we organise our own transport to Benelux.”
According to van Nimwegen the fact that MTS takes care of every stage of the logistics process leaves customers free to tend to the needs of their own core businesses. “By retaining a continuous stock we are usually able to deliver the product on time, and in the Benelux region we can deliver within 48 hours,” she said.
She adds that a well-run logistics system is vital to the success of any distributorship. “We aim to minimise the cost of transport through efficient logistics,” she said. “This in turn contributes to our reliability and ensures a good stock management system while providing the opportunity for one-stop-shopping for our customers.”
According to van Nimwegen, logistics is a relatively large cost component for MTS which means that cost-effective deliveries are vital to the success of the company. However, sustainability is also a key issue and MTS tries to avoid empty leg journeys. “We load the lorries as fully as we can through efficient route-planning and all our trucks comply with the Euro-5 standards,” said van Nimwegen.
MTS also strives to ensure that products are efficiently packed on its lorries. “The packages concerned are as small as possible to maximise volumes per pallet while saving on transport costs and space in the warehouse,” she said. “All product packaging is also clearly labelled and bears the same packaging layout to facilitate loading and off-loading.”
She adds that due to a growing 24-hour economy, the issue of logistics is becoming increasingly international. “This means time and money are both important issues and it is crucial to transport goods to the customer in the most cost-efficient way possible,” she said. “The keyword in logistics is innovation.
“Logistics develop very quickly and new ICT, storage and planning systems are coming in all the time while value-added logistics are becoming more significant. We are therefore adapting through stock management, a customer-directed service concept and one-stop-shopping.”
Increasing the efficiency of logistics is a permanent process for Ecover distributor partner BOMA according to marketing director Stijn Wildiers. “We believe in the added value that a local transport company can provide via increased flexibility and extra care,” he said.
“We deliver to our customers on a monthly basis and on predetermined dates. This allows us to reduce miles and to optimise our planning.”
He says the sustainability model of Ecover is carried through to its distribution systems. “Sustainability is not only important in our product range but also in our logistics: our vans and trucks have the lowest emission on the market,” claims Wildiers. “We are always trying to carry out our deliveries covering as few miles as possible. We also offer solutions around ‘reversed logistics’ which means we return used or written-off cleaning machines and recycle them.”
He says the company’s logistics have added to the success of the company, which has grown every year since 1974. “Our drivers deliver pallets or boxes on site and follow the instructions of the customer,” said Wildiers. “’The third door on the right on the first floor’ is daily business for a BOMA-driver. We have also been developing useful IT-tools that allow customers to control their costs; to manage their purchases and to focus on their core business, which is cleaning.”