We recently spoke with Pat Ballard, Americold's VP Business Development for Key Accounts in the Protein vertical, to catch up on the temperature-controlled protein supply chain. Read on to hear his insights...
Pat, the protein industry has been in the news a lot recently, what do you consider the latest trends for the temperature-controlled protein supply chain?
Recent trends have been somewhat dependent on variables outside the normal producer-managed responsibilities such as African Swine Flu, tariffs, and increased demand from China. Results from these factors are currently impacting supply volumes, how much protein is being harvested and how it’s managed throughout the cold chain.
The Impacts on producer supply chains are real and have resulted in additional demands from everyone involved from the small local producers to the very large global organizations, and we believe the impact on the protein industry will likely be long lasting.
Despite occasional downturns and customer supply chain challenges, we still receive many requests to support growth in regional protein markets. The dynamic nature of the meat and poultry supply chain makes those involved ideal candidates for us to support with our multi-tenant facilities offering blast freezing and other complimenting value-added services alongside traditional storage and distribution.
And what about trends in the general food and beverage cold chain space?
This is a very exciting time to be in the logistics and shipping space! Most CPG, Ag, Dairy, Bakery and Protein companies are needing to drive efficiencies and savings into their future supply chains and budgets which ultimately puts pressure on the cold chain industry and its performance. From a cold chain provider’s perspective, we have a duty to drive efficiencies across the complete temperature-controlled ecosystem we operate – beyond the four walls of our storage and distribution centers. Capitalizing on new design engineering initiatives and technological advancements coupled with the willingness of our customers to implement the customized solutions we propose, we’re enabling our customers to leapfrog their peers in supply chain efficiencies, inventory control, and cost per case. We’re seeing an increase in integrated solution requests combining warehousing, value-added services, and transportation/distribution solutions, where reducing the overall number of temperature controlled service providers and vendors supporting a specific brand is simplifying the overall supply chain process for customers.
How have companies like Americold evolved or adapted over the last few years to realign with the new need?
People rely on the temperature-controlled supply chain for some facet of their life, whether it be for food, drink, and pharmaceuticals, or chemicals and other materials used in the environments around them. It’s a huge industry. But up until January 2018, it was a privately held industry. Our industry's infrastructure requires substantial capital investment to provide and support solutions for the ongoing challenges experienced by our customers, and by going public in 2018 we positioned ourselves to be able to tap into capital more effectively than privately held organizations.
From the protein industry's perspective finding temperature-controlled capacity for large inventory piles at short notice can be hard, so we work with our customers to provide the security of longer-term, fixed commitments to protect seasonal space. We leverage the expertise of technology company partners who are developing solutions to long standing food and beverage industry needs to benefit all of the participants along the supply chain.
What advancements are being made to infrastructure?
More efficient building materials (advanced insulation materials, alternate packaged refrigerants, motion-sensing LED lighting, etc.), use of customized systems interfaces, and programs (WMS, WES, WFM/WLM), and the implementation of appropriate automated capabilities have allowed for reduced energy consumption, safer working environments for our Associates, and an overall more efficient operational flow for our business.
We’re continually reinvesting in the development of our IT systems, operational technology, and our people to support our infrastructure evolution and ultimately to support our customers as their supply chain demands evolve too. As an example, where once it was common to support full-pallet in and out moves, we’re enabling layer- and case-picking to provide mixed rainbow pallets that match consumer demands and pacify our customers' requests for a higher number of SKUs delivered more frequently.
What about order tracking and transportation - what are the improvements there?
Tracking technology has advanced significantly and allowed Americold and our carriers to be more integrated and provide a more complete inventory overview for our customers. We can incorporate both product in-storage and product in-transit in our customer metrics, enabling our customers to optimize their order methodologies and in some instances even reduce inventory pile sizes.
We’re also focused on reducing truck turn times to keep vehicles moving which provides carriers with greater efficiencies.
Data analytics software advancements have empowered our supply chain engineers to more effectively analyze, manipulate, and model data to highlight additional inventory storage and transportation efficiency opportunities.
Improvements in carrier/driver amenities have taken center stage too. We want drivers to enjoy their experience at Americold sites! Food manufacturers and retailers want their 3PL providers to operate as extensions of their supply chains and to be more mindful at facility check-in/welcome centers, and we’re adapting for this. We're spending more time and attention on guard shack designs, traffic office locations and traffic flow, lounge amenities and probably most importantly, opportunities to turn trailers faster and get driver transactions completed more quickly.
Any final thoughts?
Americold is continually investing in its supply chain, and the systems and technologies used to support it. In the last year we acquired Cloverleaf, Zero Mountain, and Lanier Cold Storage to complement our poultry and protein cold chain network for our customers, and we’ve added capacity with the recent acquisition of Nova Cold in Canada, two sites in the mid-Atlantic, and Newport Cold Storage in Minnesota. We’re almost finished with the construction of our advanced blast-freeze facility on our Savannah, GA campus to support protein exports through the port of Savannah. And our advanced Rochelle, IL ASRS expansion is complete.
Ultimately we believe customer peace-of-mind comes from a simplified, optimized, and efficient cold chain operation, where the number of service providers, and therefore complexity, is significantly reduced, visibility to a complete portfolio of inventory is accessible, and the right value-added services offering true benefits are available. We’re working in conjunction with our customers to provide these solutions and we look forward to continuing to offer our support as the protein industry continues to grow. Thank you!