PGDM - Cold Chain Warehousing & Distribution.

About The Speaker:-

Mr. Vishal Vyas has been in supply chain industry from after more than 10 years. He is graduate in B.E.– Electronics & Communications from Gujarat University and PGDM – International Business from ITM, Navi Mumbai. With experience in multiple fields like business analysis, branch operations and business development, he manages client and vendor side effectively. He has worked in Snowman Logistics, WOTU (Now Zomato Hyper pure) and Rivigo before heading Warehousing for Winter Logistics.

Mr. Vishal is pursuing Executive Programme at Indian School of Business, Hyderabad – company sponsored and undergoing Global Leadership Programme in DP World through Erasmus University Rotterdam. With DP World, he is focused on selling end-to-end supply chain solutions to customers. With current profile he manages 10 different warehousing locations across India. He has wide experience in managing multiple warehouses, developing new clients, vendor management, business plan, 3PL management, quality management, negotiation, and market research. He has done multiple feasibility studies to understand market potential, cold chain storage analysis and competition overview.

Supply Chain Overview:-

Supply chain management is the management of the flow of goods and services and includes all processes that transform raw materials into final products. It involves the active streamlining of a business's supply-side activities to maximize customer value and gain a competitive advantage in the marketplace.

1. Fragmented Activities 1960s

• Demand Forecasting - the process in which historical sales data is used to develop an estimate of an expected forecast of customer demand.
• Inbound/Outbound - Inbound logistics is the way materials and other goods are brought into a company. This process includes the steps to order, receive, store, transport and manage incoming supplies.
• Warehousing - the process of storing physical inventory for sale or distribution. Warehouses are used by all different types of businesses which need to temporarily store products in bulk before either shipping them to other locations or individually to end consumers.
• Inventory - the accounting of items, component parts and raw materials a company uses in production or sells. As a business leader, you practice inventory management to ensure that you have enough stock on-hand and to identify when there's a shortage.
• Packaging - art and technology of enclosing or protecting products for distribution, storage, sale, and use.
• Transportation - the movement of goods and persons from place to place and the various means by which such movement is accomplished.

2. Consolidation 1980s

• Material Management - Materials management is a core function of supply chain management, involving the planning and execution of supply chains to meet the material requirements of a company or organization.
• Material Handling - Material handling is the movement, protection, storage and control of materials and products throughout manufacturing, warehousing, distribution, consumption, and disposal.
• Physical Distribution - the set of activities concerned with efficient movement of finished goods from the end of the production operation to the consumer.

3. Functional Integration 1990s

• Logistics - The overall process of managing how resources is acquired, stored, and transported to their destination.
• Information Technology - The use of any computers, storage, networking and other physical devices, infrastructure, and processes to create, process, store, secure and exchange all forms of electronic data.
• Strategic planning - Process in which organizational leaders determine their vision for the future as well as identify their goals and objectives for the organization.

4. Value Capture 2000s

• Supply Chain Management - The management of the flow of goods and services and includes all processes that transform raw materials into final products.

5. Automation 2010s

• Digitalization - The use of digital technologies to change a business model and provide new revenue and value-producing opportunities; it is the process of moving to a digital business.
• Robotics - An interdisciplinary field that integrates computer science and engineering.

Introduction To Gold Chain:-

A cold chain is a low temperature-controlled supply chain. An unbroken cold chain is an uninterrupted series of refrigerated production, storage, and distribution activities, along with associated equipment and logistics, which maintain quality via a desired low-temperature range. It is used to preserve and to extend and ensure the shelf life of products, such as fresh agricultural produce, seafood, frozen food, photographic film, chemicals, and pharmaceutical products. Such products, during transport and when in transient storage, are sometimes called

cool cargo. Unlike other goods or merchandise, cold chain goods are perishable and always end route towards end use or destination, even when held temporarily in cold stores and hence commonly referred to as "cargo" during its entire logistics cycle. Adequate cold storage can be crucial to prevent quantitative and qualitative food losses.

• Supply procurement - Procurement and supply management involves buying the goods and services that enable an organization to operate in a profitable and ethical manner. In cold chain, the goods must be stored in a cool place. So as a pre-process of it is precooled on collection from farms or say from manufacturers.
• Temperature controlled transport - The storage, preservation and transportation of cargo that is sensitive to atmospheric conditions and needs to maintain a certain temperature. Reefer trucks are generally used for transportation purposes. For longer distances reefer railway mode of transportation is used. Reefer trucks are trucks with refrigeration feature.
• Temperature controlled storage - Itis a type of storage unit that is specially designed to maintain steady temperatures and humidity levels. The temperature-controlled storage is basically cold storage with blast freezing and temperature control features in it.
• End customer - The stored products are transported to retailers, markets, ports, and airport by temperatures-controlled transportation.

Warehouses are the real reason why optimized distribution takes place and customers getting their requirements delivered on time. It helps in improving the overall productivity of the involved labors and increases the customer satisfaction. Basically, it is a process of organizing and keeping the hold of all the things within the warehouse.

Warehousing:-

What does Warehouse Management include?

1. The warehouse management basically helps in arranging the warehouse and all the inventories associated with it.

2. It takes care of equipment’s whether they are well maintained or not.

3. It helps in managing the new stocks that comes in the facility.

4. It looks, whether orders are being picked, packed and shipped or not this helps in tracking and improving overall warehouse performance.

5. High retailers who are well settled in market goes after automation tools for better efficiency and effectiveness of warehouses.

Importance of Controlling temperature:

1. Whenever it comes to maintaining the warehouses, temperature plays a very vital role because storing the product at temperature plays a key role.

2. For instance, if we are required to store ice-creams at temperature but the temperature maintained in warehouses is not appropriate then it will attract in wastage of the product.

3. As cold chain logistics needs maintaining temperature well within the range as well as controlling process involved calls for extreme level of integration and coordination.

Maintaining temperature in warehouse:

To maintain the temperature in warehouses there are certain factors which we are supposed to consider, let’s look at them one by one: -

1.Humidity vs Temperature

• Humidity levels in warehouses should be maintained within the range 40-50% RH, where RH stands for relative humidity.
• As we know that, RH is directly proportional to temperature of the air. Hence, increase or decrease in the heat will impact RH accordingly.

2. Size and Layout

• Most of the issues associated with temperature and cooling is the size of the warehouses.
• Keeping in mind which part of the warehouse will be crowded in terms of the workers accordingly temperature should be maintained in that area.

3. Divide and Conquer

• Multiple products will require multiple temperature zones. Hence, organization should focus on investing in and should have clear cut understandings regarding the positionings of products.

4. Monitor &Maintenance

• To maintain the temperature inside the warehouse the temperature mapping devices should be readily monitored, and one must take care of them by generating the reports of the same on daily or weekly basis.

Warehousing facilities at DP World:

1. They have customized solutions with multi chamber facilities at major cities.

2. They offer bundle services – For Manufacturers, Exporters,Importers,Traders, Distributors & Retailers (with value added services)

3. They provide warehousing solutions for all types of temperature-controlled cargo with ERP equipped inventory management solutions.

4. Multi docking facility to handle higher turnaround type cargos.

Most product manufacturers are headquartered outside, the most prevalent in-country distribution method is for products to move from central medical shops to districts and/or regions, and then to service delivery sites. Distribution, like warehousing, is an important part of the health logistics system. The process of transporting products down the pipeline from the national central warehouse to the final clients is known as distribution.

Dustribution:-

Distribution Services at DP World:

1. GPS devices are installed into the vehicles along with the dataloggers onto the vehicles which helps them to track and trace the same at any given point of time.

2. Dataloggers are being continuously monitored and very well maintained as any malfunction in temperature will help dataloggers to give an alarm and the same will be acknowledged by the team of engineers.

3. They prefer controlling vehicles through ERP of manual.

4. They also prefer fueling through cash or fuel cards.

5. Long haul vehicles are into demand-supply basis wherein west region is highest load generator.

Vehicle Requirements:

1. They always prefer to have various vehicles as per the requirements of loads like 32ft that can carry up to 22MT product.

2. This implies that have, they have dedicated vehicles as per the services they are providing be it is airport moment or any other trips.

Cold Chain Market:-

• India's cold chain sector is expected to grow at a CAGR of more than 20% by 2025 as it transitions from traditional cold storage to modernized storage space. The forecasts are based on the sector's performance in recent months, in which, despite post-Covid economic impediments, the organized cold chain segment has witnessed strong rise in country-wide footprint.
• The transportation and warehousing of temperature-sensitive items from point of origin to point of consumption, which enhances shelf life and reduces rotting, is referred to as the cold chain. Approximately 60% of cold storage capacity is concentrated in the states of West Bengal, Uttar Pradesh, and Bihar, with potato storage accounting for 85-90% of the capacity. Cold storage in India accounts for 43.7 percent of overall revenue from the cold chain business, with only 36% having a capacity of less than 1,000 MT.
• Pharmaceutical items are likewise extremely sensitive to temperature and timing limits, making cold chain a critical requirement in this market. The cold chain is in high demand in the current context when safe delivery of vaccines for mass immunization against COVID-19 is a critical need.

Indian Cold Chain Market Drivers:

1. Growth in Organized Food Retail

Organized retail is likely to be one of the most important drivers of the Indian cold chain market with the growth of organized food retail, expect that consumers will have access to a wide range of fresh fruits and vegetables, dairy goods, meat and poultry products, and a few other temperature sensitive commodities that require cold chain storage and transportation. Most organized retail players have acknowledged that establishing a strong cold chain infrastructure is a critical step in properly managing their supply chains.

2. Growth in the Processed Food Sector

Consumer demand for processed foods has increased significantly. The Indian government has also declared plans to build additional huge food parks. This bodes well for the country's cold chain industry's expansion.

3. Shift Towards Fruits and Vegetables

Farmers are shifting away from grain crops due to increased risks and investments. Instead, they are focusing on growing fruits and vegetables. Because most of these crops require refrigeration, they are projected to boost the development of cold storage facilities.

4. Increasing Demand from the Healthcare Sector

Heat sensitive healthcare items such as vaccines, biopharmaceuticals, and clinical trial materials must be stored at temperatures ranging from 2°C to 8°C.

End to End Logistic of DP World:-

End-to-end logistics covers the complete logistics cycle, starting with procurement and distribution, transport, delivery to the customer and ending with return logistics.End to end (E2E) supply chain involves an integrated entire process, Below Diagram explains the process of E2E Logistics:

Benefits of an end-to-end supply chain:

With an integrated E2E supply chain design and visibility across the supply chain, businesses can better serve customers and the benefits are:

1. Seamless flow of activities across the supply chain

2. Reducing delays with the ability to detect any issues across the supply chain

3. Better relationships with suppliers and customers

4. Complete visibility can reduce risks, operating costs, and predict and plan to meet the needs of market changes

5. Transparency and the ability to view “blind spots”

6. Reduced labour and material costs, by removing waste in the process

DP World Overview:-

DP World is the leading provider of smart logistics solutions, enabling the smooth flow of trade across the globe. They are more than 53,000 people seeking to make global trade smarter. They establish physical infrastructure where it’s most needed and harness the infinite opportunities offered by digital technology to make the supply chain even better. They are proud to be in a business where they can make a positive difference to the world and create a better future for all. This means for their customers, people, and shareholders, but also for their communities and environments in 61 countries across six continents.

DP World Logistics:-

1. Through logistics business DP World look to enable the most efficient production and movement of cargo globally, connecting the dots between their own global network of ports and terminals with ground-breaking technology.

2. These connections provide access to global production and consumption centres, where they offer logistics services that ensure the smooth movement of cargo ship-to-shore and beyond. Their network helps customers to grow their businesses, improve efficiency in their supply chains, and explore new opportunities, especially in developing markets. Around the world, their world-leading infrastructure provides businesses with a reliable, secure and flexible base from which to expand.

3. DP World want to make trade smarter, which means working to establish physical infrastructure where it’s most needed and to harness the massive opportunities offered by digital technology to make the whole supply chain work better.

Multimodal Solutions:

1. Their smart production and distribution centres have been created in strategic locations around the globe close to sea, air, road and rail connections. This multi-modal supply chain approach has boosted cargo volumes for their customers, and reduced transit times for their products.

2. By developing projects in diverse locations they are also able to have a positive economic impact on the communities in which they work. Each production or distribution centre they open brings more opportunities, ranging from job creation for local people, to foreign direct investment and increased exporting capabilities for local businesses as a direct result of better connections to international markets. They also own, operate and invest in logistics services that move cargo and help keep trade flowing.

3. Through partnerships and advisory services we are able to support customers with our infrastructure, opening up new opportunities for trade and bringing them closer to their customers.

DP World Transportation Services:

1. Large network of business partners which provides all category of vehicles and transportation (prinmary, secondary and tertiary)

2. Reliable services on timely delivery, reporting & temperature maintenance

3. Vehicles available for varied product segments like Fruits, Seafood,Poultry, Meat, Dairy, Confectionary & Pharma ( Blood Plasma, Enzymes, etc.)

4. One Platform to Facilitate vendors and customers

Report By:-

Above report is written by Mr. Sameer Chandrasen the first-year student of Operations & SupplyChain Management department of ITM Business School, Kharghar, Navi Mumbai