Cutting the cost of moving food
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• by Toby Clark
How can companies in the food transport sector improve energy efficiency? Through "sustainable distribution", according to a recent conference which suggested ways for any transport company to cut its energy costs.
The conference, held in Birmingham, was organised by the Cold Storage and Distribution Federation (CSDF) and the Government's Energy Efficiency Best Practice Programme (EEBPP). It was based around a recent survey of transport efficiency (see box); speakers included Chris Carrington of Tesco and Charles Stephens from NET Distribution.
According to Professor Alan McKinnon, one of the reasons for instigating the survey was concern at the Department of Transport about constant downward pressure on vehicle utilisation, particularly from the demand for "quickresponse" services.
World lead the DDT's Brian Wadsworth started by saying: The UK does have a world lead in logistics." He pointed out that on average the energy used per kilometre to transport one tonne of passengers was about 14 times that used to transport one tonne of freight.
But keynote speaker Paul Bateman, distribution strategy director for Tesco Stores, warned: "Many of our customers are very well informed about environmental issues and expect the same from us."
The two agreed that the simple measurement of freight traffic in terms of tonne-kilometres is not adequate for assessing environmental impact—particularly in volume-led sectors such as food and retail distribution.
Bateman estimated that if Tesco were operating in France it would pay some 217.9m less in annual fuel tax, and he warned about the forthcoming Climate Change Levy: "The energy tax wit be a direct on-cost for industry" Roger Watkins, president of the CSDF and managing director of Frigoscandia, introduced the survey by saying: "Vehicle , design and driver behaviour are proven to improve fuel efficiency, but we must look at vehicle utilisation to move forward. It's clear that flexibility in delivery can make it easier to integrate primary and secondary distribution."
In fact supply-chain co-ordination became the dominant theme of the conference, with Watkins pointing out that sharing information between operator and customer can harmonise order times, thus improving vehicle fill and helping to reduce congestion at ADCs.
This is a major issue: the survey indicated that no less than 31% of unscheduled delays were due to problems at the delivery point. Carrington referred to the "blame culture"
between retailers and suppliers, and a lack of investment in IT solutions such as EDI (Electronic Data Interchange).
He suggested that efficiency could be improved dramatically by quicker checking procedures such as sampling rather than 100% inspection; more crossdocking; and "drop-and-drive" procedures. Carrington also advocated "profile smoothing" to eliminate delivery peaks.
For example, does orange juice really have to be delivered during the morning rush?
Excessive waiting
On the operator's side, NFT's Charles Stephens cited the problem of excessive waiting times: "If all major retailer deliveries were made within an hour, NFT could save 21.7m each year."
He, too, was in favour of collaborative scheduling, and supports cost mechanisms: for instance, if a drop took more than two hours, the depot owner could be penalised by the halter; if it was made more quickly, the haulier could reward the depot owner.
At the moment claims against NFT average 25p per delivered pallet. Stephens proposed radical schemes to reduce checking times such as de-compartmentalised trading, where a supplier is paid only when the product is finally scanned at the checkout.
He also backed proposals to pool unloading equipment such as roll cages, and "synergies" to make traffic peaks easier. NFT, for example, has arranged to use Castle Cement's tractive units and drivers in the run-up to Christmas.
But he was dismissive of detailed in-cab monitoring of the driver: "I'm not interested in knowing what our drivers are doing—I think that it could devalue efforts to broaden drivers' skill bases."
Dennis Lynch of the John Lewis Partnership was concerned about the efficiency of the vehicles themselves. "The current design of vehicles is almost pre-war," he said. "If the industry were to adopt aircraft techniques we could reduce kerb weights by 20%."
Roger Watkins summed up the conference by saying: "We've got to look at the energy required to move one pallet."