Changing your logistics provider
In this month’s “Have You Considered…?”, Kayleigh Conway takes a look at how changing provider can result in smoother sailing for your logistics.
I
n a nutshell, logistics is the art of optimum delivery of the right product, in the right format, at the right time, to the majors, multiples, high street independents and consumers at home, on both a domestic and international scale; and when it comes
to understanding the toy trade there are logistics specialists at hand. Mike Thomas, client services director at Import
Services, said: “Logistics to the UK toy trade involves the necessary planning, systematic control and movement of products along a shrinking supply chain; from manufacturers principally in the Far East, to a diverse range of retailers and customers.” Naresh Patel, chief operations offi cer at Amethyst
Group, agrees that logistics is vital to the UK toy trade: “A signifi cant proportion of toys in the UK are manufactured outside of the UK, typically in the Far East, and therefore getting them to the end users in the most effi cient, cost-effective and environmentally-friendly manner is paramount.” He added: “The demand for fast-selling lines, particularly at peak times, increases the importance of getting the product from the production line to consumers to maximise sales potential. It is logistics that makes this happen.”
Changing logistical needs Companies experiencing problems with their current third-party logistics provider (3PL) may fi nd that it lacks a necessary understanding of their business, or experience in dealing with toy retailers and huge volumes at peak times. Also, the scale of a 3PL may not be appropriate as a client grows or shrinks; leading you to either outgrow your logistics partner or end up paying for a half-empty warehouse. Other companies may simply have in-house
operations that may be looking to outsource, often due to the team outgrowing its capacity and wanting to focus their efforts on product, design, marketing, sales and business development, rather than on logistics issues and a dysfunctional supply chain. Having a third party set up can offer the fl exibility to deal with fl uctuations in volumes across the year, as well as longer-term growth. Further reasons for shopping around may include the rising costs of supplying smaller value orders
72 Toyworld
more frequently, and the rapid pace and complexity of change in retailing and B2C.
Logical solutions Relationships and connectivity with retailers and suppliers is an essential part of delivering successful logistics services. Clients are working to ever- shorter lead times and complex specifi cations, with penalties for non-conformance and greater customisation requirements for display units, pack multiples and promotional activities, and if things go wrong it is all too easy to lose that vital listing with the major retailers; so the management of bespoke requirements relies on systematic processes and great IT.
Naresh says: “Ultimately, it comes down to being able to achieve a stress-free solution at competitive costs that meets the needs of your business. We at Amethyst Group work within a partnership environment with our clients, retailers and our suppliers.” He added: “Our workforce is the fundamental part of our business. They all work closely with each other; the approach is very much one of ‘one site, one team’. We see ourselves as an extension to our clients’ offi ces, allowing them to focus on their core competencies while we deliver a stress-free logistics operation.” Having an excellent working relationship and understanding of the retailer’s distribution requirements is therefore vital; retailers recognise the benefi ts and synergies of consolidated deliveries to minimise vehicle movements and improve turnaround times. Import Services’ Port-Centric model, for example, tackles the rising costs of supplying smaller value orders more frequently head-on; Southampton is the most productive container port in Europe, and the
company operates right beside the container ships to bring toy products into the UK market. Mike said: “Back-haul based on our Southampton Port-Centric logistics model provides the optimum route to market for either consolidated loads with our other toy clients to gain an economy of scale for retail deliveries or, via direct distribution from port to consumer at home.” With toy clients working with Import Services including Flair GP, Melissa & Doug, Toymaster, Jakks Pacifi c, Clementoni, Famosa, IMC, Winning Moves, F4K, Carte Blanche, Meccano, Mumbo Jumbo Toys, and the latest addition, K’Nex, the company is expanding at Southampton Port, adding a further 13,000 pallets in 2014 to a total of 53,000 to keep pace with demand. Whatever your reason for moving logistics services,
there are companies out there who are able to offer tailored services to suit your requirements. With the toy industry being so heavily weighted against Q4 trading, the cost of carrying fi xed costs for services you only use seasonally may become an issue; taking this into account, companies such as Import Services and Amethyst Group are able to offer pay-as-you-go services to match toy trade seasonality, giving clients confi dence that payment is transactional, allowing for accurate and easy budgeting; Import Services also offers customs freight simplifi ed procedures, deferring VAT and duty until after the product is sold, offering a cash fl ow advantage for growing toy companies. Import Services and Amethyst Group also provide the full breadth of processing at the point of exit, to retailer specifi cation; from barcoding and kitting to repackaging promo packs and building and fi lling merchandising units. Amethyst Group also offers a range of co-packing services under one roof to
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