Even the world's most efficient supply chains need a backup plan when Murphy's Law kicks in.
Few are more efficient than that of Toyota in Canada. The Japanese automaker's plant in Cambridge, Ont. operates under a "next-generation" just-in-time model. Parts shipments are triggered by actual demand, not a producer's best guess. Delivery windows are narrowed to a matter of minutes.
With the help of Transfreight Inc., the third-party logistics provider formed to service Toyota's Canadian plant, things run smoothly most of the time. Invariably, though, a part will be late, an order improperly filled, or bad weather will threaten to disrupt the whole operation. That's when Transfreight calls upon another 3PL, TST Expedited Services Inc.
TST steps in when parts must be rushed to the assembly line in order to keep it running. The Windsor-based provider utilizes a combination of truck and air to meet delivery commitments, often within the hour. Parts are rushed across the border without the luxury of pre-clearance through Canadian customs. And customers pay a premium for the service. "We're a last resort in the shipping chain," says TST Account Manager Carlo Matulich.
TST is in the odd position of supplying a highly valued service that its customer would rather not use. Yet for all its success in crafting an efficient supply chain, Toyota still must allow for the kind of emergencies that only a carrier like TST can alleviate. Its reliance on the expediter has gone up and down over the years, says Matulich, rising when Toyota opened a second plant in 1997, and falling since then.
No 3PL is in a better position to serve Toyota than Transfreight, which was created expressly for that purpose when the Cambridge plant opened in 1989. The 50-50 joint venture was between Japanese conglomerate Mitsui & Co., a longtime partner of Toyota, and TNT Logistics. In addition to delivering parts with its own fleet of 600 trailers, Transfreight is closely involved in route planning on the automaker's behalf.
Having mastered the Toyota Production System (TPS), Transfreight went on to specialize in Japanese-style auto plants in North America. Additional customers include the parts supplier Canadian Automotive Manufacturing Inc. (CAMI), whose plant in Ingersoll, Ont. is a joint venture between Suzuki and General Motors, and another Toyota plant in Princeton, Ind.
|TST is in the odd position of supplying a highly valued service that its customer would rather not use.|
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