Food Import Case Study

SITUATION

A major US-based brand owner of high quality prepared food products, approached UGL about some import issues they were facing for one of their largest product lines. This included a £250,000 average annual demurrage spend and highly laborious sampling processes to manage customs and shipping compliance needs.

Due to brand growth, the business was looking for a competent and forward thinking logistics partner, able to refine the supply chain process and efficiently oversee the movement of products from factory in China, through to their national distribution centre in the UK.

This mostly automated facility handles over 40,000 loads per year, equating to approximately 90m cartons; it represents one of the largest and busiest facilities of its kind in Europe.

UGL have worked in partnership with the business since 2016 with extremely promising results, pushing the boundaries of what our partner thought achievable, while developing new ways of working that deliver real benefits.

THE UGL APPROACH

Initially, the focus was on one product line; a noodle brand. Starting at purchase order, through to UK distribution centre arrival, UGL analysed chokepoints and identified critical improvement areas.

Products from China that may contain GMO rice are subject to mandatory checks by port authorities and samples are taken to ensure compliance with EU legislation. This lengthy process incurs delays as samples are sent for testing in Germany.

Manual container unloads were taking four warehouse operators around eight hours to complete, impeding inbound flow and causing a labour-intensive chokepoint inside a depot built for palletised automation.

Using these two challenges to form the basis of our proposal, UGL began implementation through a dedicated on-boarding team of professionals, modelling out various solutions, generating logistical, financial and environmental benefits.

RESULTS

UGL reduced on-quay storage by 75% starting with a new sample-handling process. This agreement would be brokered between UGL, Port Operators, Port Health Authorities and accredited European laboratories. Samples would be processed on copy documents, and the material to be tested moved directly from Felixstowe, to the laboratory in Germany, rather than via central facilities in the UK. This new agreement would reduce turnaround time by 60% to 7-9 days, down from 20+ days previously.

This would be further improved by rescheduling the delivery profile based on when availability is needed rather than when arrival is scheduled.  UGL would also leverage our long-term warehousing partner in Claydon, near Felixstowe, to serve as a cross-dock facility. This permitted efficient delivery of 9000 carton loads, re-palletised into the automated distribution centre.

To enable this final movement, UGL sourced a twin deck trailer, custom built to handle specific pallet heights. This dedicated vehicle would be contracted to run daily, benefiting from the flatter order profile, making this vehicle incredibly resourceful.

UGL used a worldwide network of partners to source local transport in China, and ocean freight to Felixstowe. As we used the same team, they were already familiar with the client profile.

BENEFITS PROVIDED

Working closely with our client, UGL were able to provide the solutions to the challenges faced with this product line, with exceptional results, far exceeding initial estimations.

Improved flexibility with sample results: UGL were able to streamline and optimise the sampling process, not just for our partner, but for the entire industry. This cut 10 days from the supply chain and cut costs.

Reduction of £92,000 in standing labour costs: This meant offsetting 32 man-hours labour per container, for 240+ containers equates 8,000 man-hours annually.

Added flexibility by reducing inbound blockages: Now that UGL have shifted the labour intensive processes off-site, the largely automated NDC was better equipped to cope with peaks in demand and no off-site buffer storage required in 2016. The cost benefit of this is estimated to be around £60,000.

Warehouse approval through rigorous client audit: Our warehouse has been inspected and approved by the client. As an approved supplier, we can integrate with our partners’ stock system to undertake direct deliveries, and specific pallet loadouts on request.

Removal of over 240 HGVs from congested UK motorways: Through the use of specialist twin deck trailers, tailored to client specification. Optimising the delivery process for this product into a Northern Distribution Centre. Adapting the vehicle in this way is both cost effective, and in line with our environmental policies.

Utilising empty vehicles to accommodate highly efficient back-loading: Once added as an approved supplier, UGL were able to offer space on returning vehicles heading south, further removing HGV’s from busy UK motorways by approximately 480 journeys per year.

Building confidence in our approach; through non-conventional thinking, coupled with general good practice and methodical implementation, UGL were able to seamlessly integrate our new processes.