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3PL Services
3PL Customers Identify Trends and Market Segments
Two-thirds of domestic Fortune 500 companies now use 3PLs for logistics and supply chain functions according to a new in-depth research report "Trends in 3PL/Customer Relationships" just issued by Armstrong & Associates. The report utilizes Armstrong & Associates' proprietary database of 2,864 3PL customer relationships and provides detailed information on the top outsourcers to 3PLs, service demand and market size by industry segment.
According to the report, General Motors, Wal-Mart, DaimlerChrysler, and Ford Motor each use 30 or more 3PLs. The report also quantifies the Global Fortune 500 3PL market at $158.1 billion for 2005. Automotive 3PL customers spent an estimated $35.8 billion with 3PLs.
The average customer is utilizing each 3PL for three distinct services. The primary 3PL services are transportation management (20.5%), warehousing (19.3%), and value-added services (18.5%). Armstrong & Associates' report is based on 9,004 individual services.
Commenting on the report, Evan Armstrong, president of Armstrong & Associates said, "We feel that this analysis of customer relationships is our best to date and builds upon our previous reports. The greatest penetration of automotive accounts is by European 3PLs, Ryder, Penske, and Menlo. Retailing relationships are led by Maersk, Meridian IQ and DHL. BAX is the leader for Fortune's technology sector."
The complete report is available from Armstrong & Associates online at:
http://www.3PLogistics.com
The Netherlands most desirable location for European distribution centers
A recent survey commissioned by global consulting firm Capgemini and the logistics-oriented real estate company ProLogis has revealed that The Netherlands is Europe's most wanted distribution center location. The research, which involved more than 100 supply chain leaders in a wide range of industries, showed that whilst the UK is currently the largest employer in the distribution network, the country of choice for European Distribution Centers in the High-tech and Electronics industry as well as those in the Food and Beverage industry is The Netherlands, with neighbours Belgium and Germany not far behind.
The only industry which has bucked the trend is Consumer Products, which has made France their favourite location with Belgium as a distant second choice. Life Sciences and Pharmaceutical companies appear not to have a current favoured location for their distribution centers, as their network structure is highly decentralized, with many relatively small national distribution centers.
"The Netherlands and Belgium have a relatively large number of distribution centers compared to their population size. One reason for this is that these countries are close to the major demand markets, have good transport infrastructures and have access to two large international sea harbors (Antwerp and Rotterdam) to handle large overseas flows", says Roy Lenders, Vice President at Capgemini.
"The survey reveals some interesting facts and insights into the choices, strategies and challenges of the global operating companies that took part," continues Roy Lenders. "One significant fact to emerge is that, in large companies at least, the logistics department is often responsible for making strategic supply chain decisions, although the board of directors is also vital".
As for the future, respondents feel that the picture will be quite different. Anticipated changes include:
Consolidation by reducing supply chain costs, complexity and numbers of distribution centers, and by merging networks.
Increased regional distribution to take advantage of opportunities in Eastern European markets, such as Poland and Romania, and to reduce the impact of increased transport costs. Meeting change by adopting strategies that include outsourcing of logistics, leasing property, taking shorter lease contracts and using flexible warehouse space.
The report is based on a survey conducted in the second half of 2006 with a wide range of global operating companies with a significant pan-European distribution network. The goal of this report is to give a high-level overview of the pan-European distribution footprint over different industry sectors and address key challenges per industry sector. About a hundred supply chain leaders from various industry sectors provided insight into their current footprint and the main issues facing them. In all, the survey evaluated 300 distribution center locations, 18,000 FTEs (full-time equivalents) in the realm of employment and 2.4 million square meters of distribution center surface area.
The findings in this report are based entirely on the results of the survey. Copies of the key findings of the survey can be downloaded at
http://www.capgemini.com
BAX Global Awarded Warehouse Management Systems Contract
BAX Global has been awarded a warehouse management system (WMS) contract in Hong Kong by cell phone manufacturer Kyocera Wireless Corp (KWC). Kyocera has been a long-term customer of BAX for airfreight services, and expanded the relationship with the new WMS contract. This new Hong Kong facility will help to streamline shipments of phones produced in mainland China direct to KWC customers, bypassing the need for US warehousing and distribution hubs. This direct distribution model will significantly reduce transit times and warehousing costs, increasing the efficiency of the KWC supply chain.
http://www.baxglobal.com
TransGroup Worldwide Logistics Introduces Greenhouse Gas Neutral Logistics Solution
Seattle-based Freight Forwarder/3PL TransGroup has introduced TransNeutral--the industry's first 100% Greenhouse Gas (GHG) Neutral Logistics Solution. TransNeutral is a not-for-profit, opt-in program that enables TransGroup's customers to 'green' their shipments with a nominal contribution (less than 1/7 of a cent per pound on Domestic shipments) for every pound they ship. TransNeutral uses a weight-based calculation to determine the amount of climate-effecting GHG that a shipment emits; and then offsets those GHGs by contributing to GHG Emission Reduction programs involving reforestation, wind power and biofuel related farm renewal projects.
http://www.transgroup.com
DHL Launches North American Trade Lane Initiative
DHL, the world's leading global express delivery and logistics company, today announced a new program that will streamline cross-border shipping in North America. Specifically, the DHL North America Trade Lane initiative will speed and expedite cross-border shipments, saving time and money for U.S., Canadian and Mexican companies participating in the $8.8 billion cross-border express and ground parcel shipping market in North America.
DHL's North America Trade Lane initiative represents a new way of looking at the rapidly changing needs of cross-border shippers in North America. DHL developed the program to help customers better address the ever-changing needs of global commerce. To that end, DHL is adapting its networks, infrastructure and services to better match customers' evolving supply chains. The program includes:
1. enhancements to DHL's facilities, fleet and other infrastructure, including new International Gateways and expanded "Border Operating Centers" (BOCs);
2. additional bilingual customer service representatives to help customers navigate the regulatory aspects of cross-border shipping; and
3. additional representatives to help customers with cross-border shipping solutions.
During the first five years of the new initiative, DHL's launch of several expanded Border Operations Centers will facilitate customer shipping across the U.S.-Mexico and U.S.-Canada borders. These BOCs will streamline and expedite cross-border service in express and ground parcel shipping within North America. Beginning in 2007, each of DHL's BOCs will expand operations to include, under one roof, everything needed to speed customers' cross-border shipments. Created to help companies achieve more efficient cross-border shipping among the U.S., Mexico and Canada, the DHL BOCs will feature advanced technology inspection equipment, fast-track customs clearance systems, and specially trained staff.
Canada and Mexico together represent nearly $300 billion a year in export business to the United States, and are the first- and third-largest trading partners for the U.S., respectively. The U.S. is also the leading trading partner for each country.
To serve the U.S.-Mexico trade route early in 2007, DHL will launch BOCs strategically located in Tijuana, Juarez, Nuevo Laredo, Reynosa and Matamoros, Mexico--with companion U.S. locations just across the border. DHL will also expand US-Canada cross-border operations to facilitate expedited northbound and southbound shipments. DHL has already dramatically increased its Canada network with the purchase in of Loomis in 2003, one of Canada's leading express and ground parcel shipping networks, adding new facilities to the DHL express network and recently reconfiguring its network operations to accept larger aircraft.
Future DHL improvements to support the flow of goods and documents throughout North America will include additional ground network upgrades and ground fleet enhancements, added flights in all three countries, specialized customer-focused call center operations, and additional Border Operations Centers along the U.S.-Mexico and U.S.-Canada borders.
http://www.dhl.com
C.H. Robinson Acquires India-Based Freight Forwarder
C.H. Robinson Worldwide, Inc. has acquired certain assets of Triune Freight Private Ltd. and Triune Logistics Private Ltd, a third party logistics provider based in India. Triune has approximately 160 employees in 19 offices throughout India, and has annual gross revenues of approximately $11 million.
Triune has more than 600 customers and provides primarily air and ocean international forwarding along with customs clearance services. They also have a projects division focused on highly specialized movements and solutions. Like C.H. Robinson, Triune is non-asset based. Headquartered in Chennai, Triune was founded in 1999 and is privately held; terms of the acquisition were not disclosed.
http://phx.corporate-ir.net
NYK Logistics Expands Crossdock Potential
As of December 4th, NYK Logistics (Belgium) will provide its cross-dock activities out of a new location in Sint Katelijne Waver. With a surface of 3.750 m2 and 26 loading docks, this site offers various possibilities to optimise the current night distribution network. At the same time the warehouse offers a solution for the continuously growing volumes of both existing as new customers.
With its extensive network of hubs and platforms, the NYK Business Unit "Night Distribution" offers possibilities for the distribution of automotive parts and accessories all over the Benelux and France.
Numerous automotive manufacturers deliver from 6 pm to 11 pm the parts that were ordered during the day to the cross-dock centre. The items are sorted out and consolidated in a distribution truck, based on their destination. These trucks will make the final delivery to garages and technicians over night. In this way NYK Logistics (Belgium) delivers the right part at the right place in the right time, resulting in a guaranteed service level to the end user.
http://www.nyklogistics.com
TNT Logistics Changes Name to CEVA Logistics
TNT Logistics, the world's largest "pure play" contract logistics company today announced it changed its name to CEVA Logistics. In connection with the name change, the company also unveiled its new corporate identity and will begin doing business under the new brand across 26 countries worldwide as of today. As the second largest logistics company world wide, CEVA has a turnover of 3.5 billion. It employs 38,000 people and operates over 7.4 million square meters of warehouse space across 26 countries world wide.
http://www.cevalogistics.com
Con-Way and General Motors Agree on Valuation of Vector
Con-way Inc. and General Motors Corp. have completed valuation of their logistics joint venture, Vector SCM, LLC (Vector), establishing a fair value for Vector of $96.4 million. On June 23, 2006, GM notified Con-way of its intent to exercise its call right under the Vector agreements. The call right entitled GM to purchase from Con-way the membership interest in Vector held by Menlo Worldwide, LLC. Menlo Worldwide, LLC is Con-way's global contract logistics subsidiary.
The valuation will result in Con-way receiving a purchase price of $84.8 million for Menlo's membership interest in Vector, with the transaction scheduled for completion on January 5, 2007. Vector was formed as a joint venture between the two firms in December 2000 to deliver lead logistics provider services for GM's global supply chain. As part of the agreement to sell its membership interest in Vector, Menlo Worldwide will assume all commercialized contracts where Vector was providing services to non-GM entities.
https://www.con-way.com
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