Openfield appoints DHL as logistics partner to deliver most efficient supply chain in agricultureMilton Keynes UK, 09/17/2008, 11:30 AM CEST
DHL Exel Supply Chain has been appointed supply chain partner to Openfield, the planned new merged business of Grainfarmers and Centaur Grain.
In a five year contract worth around £125 million (154 million euro), DHL will be using its logistics expertise to work with existing grain carriers to establish a more efficient supply chain.
This appointment comes after three years of collaboration between the companies, looking into ways that the existing supply chain could be streamlined to counter increasing operating costs and growing food costs.
During this collaboration, DHL Exel Supply Chain was able to draw on its knowledge and technological expertise gained from improving supply chain efficiencies in other industries, such as automotive and construction, to develop a best practice model for the transportation of grain in the UK.
Major efficiency savings
Through trials with both Grainfarmers and Centaur Grain and one of their key food processing customers, this best practice model has already demonstrated significant improvements in supply chain efficiency. When applied across the two businesses, DHL expects there to be up to a 10 % reduction in food miles and a saving of 2,500 tonnes of CO2 per annum, achieved through greater collaboration and forward planning.
Tim Davies, Chief Executive designate of Openfield commented: "Working with DHL over the last few years has clearly demonstrated that there are some major efficiency savings that can be made in the food supply chain. Now, with Openfield potentially responsible for moving around 20% of the UK's grain harvest every year, we welcome DHL as an integral part of our team and look forward to creating the most efficient supply chain in the industry, one that drives efficiencies and adds value to our farmer members and customers."
DHL Exel Supply Chain will now be putting this model into practice across all Openfield's grain logistics operations, covering 120,000 grain movements each year. From the DHL Exel Supply Chain control tower at Openfield's headquarters in Colsterworth, Lincolnshire, DHL will be using technology to order, plan and optimize grain movements whilst also managing payments and providing delivery confirmation and support services.
Reducing waiting times and empty running
Richard Beldam, Chairman designate of Openfield added: "Openfield recognizes the exceptionally high service standards and personal communication to both its producers and customers that have been established within both Grainfarmers and Centaur. The relationship with DHL will not only maintain these but will add new technology and innovation that will raise the service standard to even higher levels."
The new contract involves DHL taking over the existing Grainfarmers fleet which makes around 15% of the deliveries in any one year. Primarily, DHL will be managing and co-ordinating deliveries to ensure that the supply chain is working to its maximum potential, with waiting times and empty running reduced, both of which are extremely wasteful in terms of time and the environment.
Roly Taplin, Agri-Food Business Director at DHL Exel Supply Chain, commented: "We are pleased to have been appointed to work with Openfield and look forward to playing a fundamental role in supporting one of the leading businesses in the agri-food market in revolutionizing its supply chain.
The best practice model developed through our collaboration really gets to the bottom of the issues that this sector has been facing in the delivery of grain, and by doing so there are some significant benefits that will really differentiate Openfield in the agricultural market."