The principal challenges facing operators of cold storage facilities — among them labor, increasing customer demands, and greater productivity, were addressed by the Truckload Carriers Association Refrigerated Division Annual Meeting's session: The Coolest Trends In Warehousing.
Participating in this panel discussion were Mike McClendon, executive vice president, Richmond Cold Storage, a Richmond, Virginia, provider of cold storage, dedicated warehousing, and logistics services, and Richard Kappmeier, vice president, western region, USA, VersaCold Logistics Services, a leading global provider of logistics services for temperature sensitive products, headquartered in Vancouver, British Columbia, Canada.
Corey Rosenbusch, senior director of policy and programs, International Association of Refrigerated Warehouses, Alexandria, Virginia, moderated the discussion.
One of the biggest expenses for cold storage facilities is labor, both McClendon and Kappmeier said. There is a lot of difficulty in finding workers because the cold working environment is not for everyone, said Kappmeier.
Both VersaCold Logistics Services and Richmond Cold Storage are putting a greater emphasis on the pre-hiring process, using a more systematic approach to screening and training, and then managing workers.
“We've put in a logistics management system that allows us to manage workers down to the minute,” Kappmeier said. “This makes us more efficient so we can turn more trucks around with fewer people.”
Richmond Cold Storage has adopted ISO 9000 to its procedures and policies. ISO 9000 is a family of standards for quality management systems.
“You have to have technology in place to track your labors' productivity, and then reward that performance,” McClendon said.
Both Richmond Cold Storage and VersaCold Logistics Services use incentive bonus programs for their facilities. This, along with increased employee training, has helped reduce turnover.
“Labor productivity needs to be a business culture, and this is very important to success,” said Kappmeier. “If you control your labor,” McClendon added, “everything else falls into place.'
A major trend among cold storage facilities is increasing customer demands on service. Kappmeier and McClendon said that as their customers' costs of doing business have gone up, they want public refrigerated warehouses to provide additional services beyond just storing goods. Customers are seeking additional cross-docking, more frequent and smaller deliveries, more case picking and order building, and more timely information on their orders.
This, in turn, is increasing the demand for technology to better manage all the services provided, said McClendon.
The two also see a trend to seven-day a week operation.
As for transportation issues affecting refrigerated warehouses, there must be higher levels of service and productivity. “Warehouses need to be set up for the velocity of the business — loading and unloading,” said McClendon. “Trucks have to be loaded and unloaded on time, and there needs to be good communication between all parties to avoid any problems ahead of time.”
Refrigerated warehouses need to view the carrier as a customer, and be treated with the utmost respect and be given the best service,” Kappmeier said. What that means, both men said, is being ready for all appointments, and getting products loaded/unloaded promptly and correctly counted.
Richmond Cold Storage and VersaCold Logistics Services are both appointment-only facilities.
They also echoed the need for better treatment of drivers. Along with getting them in and out on time, they said, there needs to be clean, comfortable driver lounges, with amenities such as vending machines and wireless Internet.
McClendon and Kappmeier each recommended visiting with drivers and asking them: “What could we do better?” Drivers like to talk and they often have good suggestions and ideas.
Both VersaCold Logistics Services and Richmond Cold Storage are testing RFID (radio frequency identification) devices. The companies see them as an emerging technology due to the devices' capabilities to deliver more real- or near-time information about products and product inventories.
The challenge, Kappmeier and McClendon said, is creating RFID devices that can “live” in the harsh refrigerated and frozen environmental conditions.
To remain successful as time goes on, the pair recommended that companies frequently review how they do business, continually look for ways to improve, and work more closely with their customers.
“Sit down with customers on a regular basis and ask how you are doing,” said McClendon. “Once you know that,” Kappmeier said, “make the appropriate changes.”