chris catto-smith, freshport asia - improving logistic efficiencies in south east asia
DESCRIPTION
The Asia Pacific Food & Fibre Summit focused on Asia’s growing demand for agricultural products. An outstanding a cast of speakers from government, industry and academic backgrounds, discussed the potential for Australia and NZ, to secure supply chains and capitalise on the boom for the Asian century.TRANSCRIPT
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Rapid Implementation Case Study Chris Catto-Smith
Choosing the right Distribution Networks Adding Value – cold chain case study
Challenges and the unexpected
Pack Ship Sell Pick
The “Simple” Fresh Produce Supply Chain
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Lower logistics cost per kg:
Increased Shelf Life on arrival
Reduction in Damage Claims / Shrink
Reduction in Transportation costs
Load Optimization & Consolidation
Value that Retailers support:
Pre-conditioning / Pre-cooling of produce prior to Shipping
Thermal Protection & Monitoring (Every Step)
Compliance with General Food Laws
Improved Transport Handling & Thermal protection (2-8°C, 8-15°C)
Environmental Benefits:
Lower Carbon Footprint (elimination of gel pack & Foam packaging landfill)
Lower energy consumed at each stage of handling
Reduction in single use packaging / A pallet sized solution that can be returned folded and flat
Product Freshness & Food safety
Driving Change: Cost vs Quality in a Responsible Manner
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Shipper
Packing Staging
Current Method 35°C
60 Mins
35°C
120 Mins
15°C
60 Mins
10°C
60 Mins
35°C
60 Mins
24°C
20 Mins
28°C
10 Mins
Just in Time
Staging
Dry Ice added to hot container
Hand
unloading
Product
hot on tarmac
No
protection airborne
Perishable
Packing (Data logging)
Warm build-
up product temp 17C
Pallets kept
on truck
Hand loading
Broken cold-
chain
Product
hot on arrival
What started the project – broken cold chain / huge wastage
Thai Fresh Produce exporters had become logistically uncompetitive
Loading Temperature 24ºC
25% wastage
Unknown Post-
Harvest care
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Immediate Improvement 2°C
10 Mins
2°C
20 Mins
2°C
90 Mins
2°C
60 Mins
2°C
90 Mins
2°C
10 Mins
2°C
10 Mins
Shipper
Packing Pre-cooling
Pallet return to packhouse
Pre-
Cooling
2°C (or as reqd)
Rapid Dock
Receiving
using trolley
jack or tail
gate
unloading
Thermal
Protection at Ramp <17°C
ULD
Protection airborne
Perishable
Packing
Using liner plate
on base
Of pallet – lift side
ETV Cold
Storage 10-12°C
All through
pallet usage
Rapid Dock
Loading
using forklift
or tailgate
PMC
Build & Weight Pallet cover
Development of Thermal Covers to cover the breaks
Good Post-Harvest
Intervention, Pre-cooling
& Shelf ready packaging
Loading Temperature 1ºC
ZERO claims or wastage
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Refrigerated Delivery Vehicles
(minus 20ºC – 5ºC)
Problematic temperature control
Ambient Delivery Vehicles
can be run at 20- 35ºC
Cream tests successful with truck temp at 48C
No cold chain breaks during loading
Trip Cost
~30-50% lower
Fuel & Energy
~5-10% less
Replacing Refrigerated Transport
with Ambient Transport with lower cost / less fuel usage
Insulated Ambient truck temp 27c
Pallet starting temp 5-7c
Pallet arrival temp 6-7c
Chiller truck temp average 8c
Pallet starting temp 4-5c
Pallet arrival temp 5.5-6c
Cream Transport using Ambient Truck & Thermal Covers - 6 hours
Cream Transport using Normal Chilled Truck – 7 hours
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Polystyrene waste is a huge environmental problem in Asia resulting in significant pollution
of waterways & energy waste – it cannot be recycled – but often un-hygienically reused.
South East Asia’s Retail Logistics Curse
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Expanded polystyrene is an
irresponsible packaging material
that cannot be recycled and
which is often discarded or
thrown away
Example of expanded polystyrene foam cartons – not popular with consignees
Objective to remove polystyrene from the Fish Supply Chain
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Elimination of single use polystyrene cartons
A solution was developed for reusable / returnable / foldable thermal
eco-friendly packaging (solution developed with a Regional retailer)
Eco box
Eco Box (Dairy, Fresh Cut Produce, Frozen)
Design Concept
Foldable / washable / re-useable
100cm long x 60cm wide x 30cm high
Avoids use of oversize polystyrene cartons / reduced wet ice
Reduces requirement for refrigerated transport (<36 hours)
Prevents damaging oversize products in standard size crates
Target Performance:
Target produce weight 30-50kg, including wet ice / eutectics
Light weight chilled produce Pre-cooled 2-5C /
Fish transport in minimal wet ice 0-2C, Whipping Cream 2-5C
Stackable 4 layers high / 2 boxes per pallet layer - folds flat for return
Additional insulated transportation inside thermal pallet cover
Eco-Box (Loose Load or pre-packed less than Palletized Product)
Collapsible, nestable, returnable. Supports Chilled (Frozen version in development)
Two sizes developed
Oversize Pallet Box
100/107cm x 60cm x 30cm
Delivery Box (frozen)
60cm x 40cm x 20cm
Can be used in conjunction with
Eutectic cold bricks or stand-
alone.
Uses an inner plastic liner to
contain wet ice.
Vacuum insulated panels to be
used for frozen box
Project Benefits:
Maintains cold chain integrity for multi modal and long distance transport (2- 3 days)
Lower energy cost using ambient transportation in lieu of refrigerated transport.
80% reduction of wet ice used in transportation of fish (reducing product damage)
Improved quality / shelf life and reduced waste for chilled & highly perishable products
Prevention of chilling injury during transportation for certain products
Lower environmental impact by using reusable thermal packaging in lieu of polystyrene
Lower in-store infrastructure costs (reduction in use of back room refrigeration)
Cover folds up for lower cost return transportation, must be washed on each cycle of use
Thermal Covers – Benefits
Thermal Covers – Test Results
Testing
A number of tests were carried out to confirm that thermal covers could perform with the different
products / handling requirements of Metro, they involved Fish and F&V. These tests met or exceeded
expectations. Test Summaries are as follows:
Fish
Maintained 2 – 5 kg wet ice in plastic crates for a period of 3 days @ 1- 2C
Improved quality of fish received in store (less damage)
Dairy & Cream
Transportation from manufacturer to distributor warehouse 5 hours 2-5C
Ice Cream
Transport from manufacturer to retail DC 5 hours <18C
F&V
Maintained temperature of pre-chilled apples at 4C for 3 days at 8 -15C
Maintained pre-chilled apples <8C exposed to 30C ambient for 3 days
Prevented chilling injury with sensitive produce for 3 days in 2-5C environment
Ambient
Ambient
Ambient
Temperature
10mm cover &
No cooling block
10mm cover &
3 Cooling blocks
10mm cover &
3 Cooling blocks
Result: 3 pallets of apples,
with temperature maintained
<5C for 52 hours
Trial 1: Chilled Apples in Low Ambient temperatures 3 days
Whipping Cream between 2 & 5C to maintain efficacy
Average ambient temperature inside the truck. 32c
Under thermal cover
temperature readings Average temp 5c
Temperature Inside 1 gallon cream tub
Product temperature
increased 1 degree in 5 hours
2-5ºC
Trial 2: Chilled whipping Cream – Ambient Truck Transportation 6 hours
Palletized Ice-cream <minus 18C,
Average ambient temperature inside the truck. 17C
Product temperature increased 2 degrees in 6 hours
Under thermal cover
temperature readings Average temp 5c
Trial 3: Ice Cream – Ambient Truck Transportation 6-12 hours Metro Delivery
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Normal
transportation
method of
Mackerel:
Using undersized
plastic crates
No standard
polystyrene box
was available- so
traditional method
is to use second
hand (not clean)
poly boxes or
recut standard
boxes with
contamination
from cut
polystyrene.
Trial 4: Mackerel Shipment with Wet Ice
Test 4: Fresh Mackerel Shipment with Wet Ice
Testing using 25kg of fresh
mackerel - average length
90cm
48 hours – delivery from
CanTho fish platform to Anh
Phu Store
Result: all wet ice intact
Maintained temperature
Trial 4: Fish on Wet ice - 3 days only with refrigerated transport
Ambient Truck & Platform
Temperature
Logger inside
body of fish
Temperature Logger on
top of fish
Trial 5: Protection from Chilling Injury
(Herbs, Bananas, Tropical Fruits)
Page 26
Average temperature differential 15C 18 hours
Ambient Pomelos. Exposed to potential chilling injury
Product core temperature decreased 5C / 15 hours.
1C temperature decrease / 3hours.
The thermal cover showed it can provide protection for sensitive produce from chilling injury during
transportation.
Cold room temperature
Logger inside centre of pallet
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New Product Offering – Low temp frozen in situ cold room
1. Frozen, deep-frozen and refrigerated commodities.
2. Inner temperature can be kept to -20C even in a midsummer.
4. Various types of cooling containers are available
Thermal Engine from Japan
Can Tho Fish Platform
as part of an overall Fresh produce
Implementation project
Rapid Implementation Case
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In just 18 months: End to End Fresh Supply Chains
.
.
Suppliers Inbound
Transport
Consolidated Value Added Tier 1
Value Add
Consolidated
Delivery
Stores
. . . . .
North
Centre
Greater HCMC
MKD
South
Local Seafood
Freshwater QA & Cross Dock CanTho Fish
collection
Cool & Pick Stage / Xdock
Local & Import
meat Central Stock
Dalat
Fruit & Veg Contract F&V
F&V Import / Local
Stage / Xdock
Central Stock
Dairy & Frozen Stage / Xdock
HCM &
HAN
sourcing
Project Vision
Offer Vietnamese consumers good quality fresh fish which is produced
in a sustainable way and processed under international hygiene, cold
chain and food safety standards
Page 30
Through the introduction of innovative & practical supply chain practices that
deliver end to end cost savings & increased farmer revenue.
METRO Cash & Carry Vietnam commits to implement the First
Fresh Fish Value-Chain in Vietnam by:
• Investing in the relevant farmer extension program to support:
• The development of the Good Aquaculture Practices (GAP)
• The training & certification of over 250 fresh water fish farmers on GAP standards
• Increasing farm-gate revenue through long term collaborative sourcing programs
• The sourcing of the seafood products in priority from the GAP certified farmers
• Reduce the current risk of food safety issues with traditional trading and wet markets
• Innovative supply chain solutions that deliver value and scalability
Why we undertook this project
Page 32
Metro Can Tho Collecting center
Metro Stores
Horeca - Retailers
Consumers
Collectors 1
Farmers
METRO
Supervision
METRO
Requirement
Standard
The aim was not to beat traders or compete with wet markets on price at their lower
quality standards – but to exploit the higher end HORECA market that is willing to pay
for properly marketed higher quality products . Volume sales will then drive cost
efficiencies.
The New METRO Fresh Fish chain
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Pow
erp
oin
t_M
aste
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CC
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Photo taken prior to the fish platform implementation at the Can-
Tho Fish market of fish being purchased for Metro
We can’t control quality / food safety with our current collectors
It’s a matter of hygiene / food safety
Page 34
Photo of the Can Tho Fish market collector
Traders that sell fish to Wet markets often rely on corrupt
trading practices & illegal transportation methods
Basic Fish Processing in deplorable conditions.
Page 35
Metro had trained 300 Trained Fish Farmers in the Mekong
The Problem
Can Tho fish collecting center location
Can Tho as a central cross road in Mekong delta with airport facilities.
(Possibility to use available land nearby the Can Tho Store
• Available empty land
• Existing licenses for fish
processing
• Existing waste water
treatment to be upgraded
• Reinforce the image of
METRO in Mekong delta
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Impression of container facility:
17 modular-containers are used to support Fish Platform work
flow from goods receiving to dispatch.
800K USD – 5 months
400K USD – 4.5 months
1M USD – 6
months
Initial Designs – Too expensive / long delays
Page 38
Pow
erp
oin
t_M
aste
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CC
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egio
n.p
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Site for
Interim
Facility
Car park slab
Water treatment
Use an existing store facility
Page 39
Fish Platform: Layout
Using standard shipping containers: quick to
make. Whole solution is portable ,
Containers & Civil works – 150K USD
Fit-out & Equipment ~ 56K USD
From car park to completion 20 days
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2
3
4
6 7
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1. Receiving & QA
2. Cooling
3. Put away buffer
4. Ice /delivery
5. Processing
6. Packing
7. Staging / Storage
8. Loading
9. Crates
10. Waste disposal
11. Dry Storage
12. Administration
13. Changing Rooms
14. Rest / eating area
Simple layout / One way flow
Page 41
Facility Start up – simple and efficient
Page 42
Easily cleaned – vastly improved hygiene
• Mekong Delta sourced fish represents 60% of volumes of METRO fish assortment
• Handling of over 80 species: 50% are farmed fish and 50% are captured sea fish species
• Serve Nationwide stores
– As result, in 2011, around 300 farmers and 50 collectors have been trained in the
METRO requirement standard for Aquaculture and Fisheries
actual Forecast Stage 1 Stage 2.1 Stage 2.2
>3T per day
4-5T per day
+ processing
>5T per day
Scalable design to manage volume growth
Page 44
UNUSED LAND
CRUSHED GRAVEL
Step 1: Completed <end Aug
Rapid Implementation (20 days)
Scalable Design (no building permit)
Re-locatable containers
Recycled Materials – low
environmental impact
HACCP design principles
Worker & Hygiene Friendly
Uses store infrastructure (water
treatment, electric, utilities)
Ultra Low cost construction
17 Containers 660 sqm
Stage 1 – completed in 20 working days
Page 45
Logistics Area
Crates Allocation
Receiving
Loading
19 Containers 1000sqm
Stage 2 – completed 3 months (with Ice machine)
Page 46
Ice Making Machine
Cooling
Logistics Area
Crates
Receiving washing
QA
Staging
Doubling the platform are ~1,200 sqm
23 containers 1200sqm
Crates
Loading Logistics Area
Stage 3 – limited expansion based on volumes
Page 47
Ice Making Machine
Cooling
Logistics Area
Crates
Allocation
Loading
Receiving washing
QA
Staging
23 containers 1548sqm
Full expansion
Thermal pallet covers improve cold chain integrity and provide a suitable solution to reduce the
volume / weight of wet ice required for shipment from Cantho to the cross dock platforms and
selected stores.
Using covers will allow improved protection of fish in transit, reduced ice consumption, and potential
reduction in refrigerated transport costs.
Additionally Foldable returnable insulated boxes will be introduced for deliveries where store receive
loose loads (not palletised).
Thermal Covers are being
Thermal Covers – to reduce wet ice
Page 49
Containerized flake ice machine with automated dispenser & leveling rake… -10C storage
First in Vietnam / Asia. 5 ton / day capacity, (pre-fitted capacity upgrade of 20% )
Produces correct specification of hygienic flake ice (same as a store) for fresh fish
100% re-locatable to another site. Uses store processed water.
Budget estimate 60K USD containers, Installation & Civil works (subject to validation)
Electricity / Water / depreciation costs more competitive to commercial ice supply
A Design First for Vietnam & Asia
Portable Flake Ice machine – 5 ton / day
75% of all freshwater farmed fish is sourced from MKD. Metro commenced with 200
certified farmers. Remaining 10% of fish is untraceable, lacks hygiene standards &
purchased directly by stores.
Product is not
certified safe & is
untraceable.
Many shortcuts
taken by farmers
& traders to cut
cost & food
safety.
Fish Sourcing in Vietnam for Metro
Page 51
J10
Hai Phong / Vinh
Hue
Nha Trang
Vung Tau
Potential Additional
Collecting Centers
Set up simple fish platforms across Vietnam
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A company can only generate profitable growth
over the long term if it acts responsibly towards
society and the environment.
That is why METRO GROUP had declared
sustainability to be an integral component of
the Company’s strategy in developing these
cold chain solutions.
The project involved implementing a range of
innovative SCM solutions (including covers). It t
was successful in meeting both social &
environmental needs were considered as
essential business case inputs. Sustainability
was considered at an early stage in project,
business and processes decisions.
Sustainability & Environmental Responsibility
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