Guest Post: Shubh Mann, VP of Sales
Food is shipped from all over the world. In 2015, North America exported a total of over $2 trillion dollars worth of products to other countries1, which consisted of mostly ingredients and food. Shipping food internationally can be challenging and it requires significant planning across all stakeholders. The process of shipping can be divided into three steps: first-mile, line-haul, and last-mile. Each step is unique depending on how product is moved and where it is going. There is a lot that should be considered in each step when shipping commodities internationally.
1. Starting The Shipping Process – First-Mile
The first-mile portion consists of getting the food from the manufacturer to the next shipping mode. To ensure quality product successfully delivers through this portion of the journey, it is vital that companies involved in the supply chain have local knowledge of the conditions and infrastructure of their product’s origin. Companies that desire to have a successful supply chain will need to build highly adaptable models based on both local and global expertise.
Each region and country present different barriers for effective execution of the first mile including regulatory differences with local authorities, disease control, port authorities, and more. Further, the temperature and handling requirements for food products varies tremendously based on the commodity being shipped2. Understanding the commodity, expertise of local players, regional regulatory challenges, and political climate allow for better management of product through the first mile.
2. The Longest Phase – Line-Haul
The line-haul portion is not only typically the longest phase of the supply chain journey, but also where shippers and buyers have the least control. In this phase of transportation, preparation and knowledge are fundamental keys to success. It is important to consider all modes of transportation – ground, air, and ocean – that could be utilized for the line-haul portion of the supply chain.
Land transportation is the most common method of transporting food products. Shippers in developed markets such as North America and Europe have established excellent supply chains to manage these inland moves via road or rail. However, infrastructure in other countries may not be as mature. In these cases, it’s important to know road and rail conditions that you will encounter throughout your shipment. The major challenge is applying successful shipping models and best practices in developing countries.
Ocean transportation of food has grown tremendously in the past decade and is expected to continue growing. Global shipping lines have invested in significant improvements to the overall capacity of vessels, as well as specific focus on improving capacity and control for temperature-controlled shipments. As these investments will create greater capacity, larger vessels can also pose risk due to lack of flexibility in schedules and the need for larger port infrastructure could limit options to optimize the first and last miles. Shippers need to fully understand vessel schedules and potential conditions that may be present along the route. Weather patterns can extremely fluctuate and handling conditions can vary dramatically at different ports. A minor adjustment or disruption in the sailing schedule can have extreme consequences at either port, where containers full of perishables could sit for hours or even days in unsuitable conditions. During transport, gaps in communication and visibility of the location, temperature, humidity, and other variables could affect the quality of the product when it arrives at its destination. Companies need very strict processes and management protocols to account for these gaps.
For shipments by air, which comprise a smaller proportion of the global food market, the key is to have good relationships with your logistics provider. Commodities that are shipped by air have very short shelf lives and must be managed extremely well at the first mile and last mile. The journey by air is typically less than 24 hours, conditions are fairly well understood and ambient conditions do not change dramatically. The handling procedures at each airport, as well as first and last mile transportation components are important in maintaining the integrity of the product. Customs clearance and regulatory compliance, similarly, become even more important as delays can result in significant damages.
3. Reaching Your Destination – The Last-Mile
At the destination or last-mile portion, it is once again important to have controls that account for changes in commodity-specific requirements, local handling, transportation capability, and local infrastructure. Finally, regulatory compliance, which varies based on commodity and locale, can be very tricky. Successful companies have local knowledge and relationships to ensure that regulatory compliance does not impede the timely release and delivery of product. Delays in accessing and transporting product can have dramatic consequences for health and safety, as well as the quality of the product upon delivery. Further, consider the fact that most global shipments are typically destined to a local distributor rather than to a final retail outlet and this is the start of a secondary or tertiary supply chain.
Companies involved in the supply chain of food need innovations with both global and local expertise to successfully deliver in this dynamic market. The key attributes that will define successful supply chains in global food distribution will be to have knowledge and agility within both the origin and destination locations.
Joining NFI in 2014, Shubh is responsible for NFI’s sales teams for Brokerage and Global Logistics in Canada. Shubh is focused on growing NFI’s customer base in Canada with a rapidly expanding sales team and integrating its end-to-end capabilities to offer comprehensive solutions to our customers.