Shippers discover ways to cut costs

05/22/2009 04:28:49 PM
Ashley Bentley

Diesel costs are down, but distributors are still finding ways to be more efficient and cut costs when getting their products from point A to point B.

“Right now there’s a lot of cross-docking with shippers,” said Tom Rodmyre, warehouse manager with Co-op Partners Warehouse, Minneapolis-based The Wedge Co-op’s warehouse division. “I’m letting wholesalers sell themselves and use my trucks.”

Rodmyre said Co-op Partners has been offering cross-docking services for quite a while and that the business has gotten big.

                       Courtesy Co-op Partners Warehouse

A worker moves product being cross-docked at the Co-op Partners Warehouse, a division of The Wedge Co-op, Minneapolis. Tom Rodmyre, warehouse manager, says the company has added a day to two of its routes.

Co-op Partners also added a day to two of its routes. The company is now shipping to Duluth, Minn., six days a week and to Marquette, Wis., two days a week, up from five days and one day last year.

“Customers asked for additional deliveries,” Rodmyre said.

The company ships within the five-state area of the Twin Cities.

Bridgeport, N.J.-based Albert’s Organics is also adding to its existing delivery scheme from its Mounds View distribution center.

“We continue to add drivers and new routes,” said Simcha Weinstein, director of marketing. “We anticipate adding one additional driver to each of our delivery lanes this year.”

Superior Produce and Specialties, the Northfield, Minn.-based subsidiary of Upper Lakes Foods, Cloquet, Minn., brings in two trucks per week from the West Coast, as well as product from Nogales, Ariz.; McAllen, Texas; and the Southeast, said Doug Strandquist, produce manager.

“Transportation costs, especially from the West Coast, have come down dramatically,” Strandquist said. “We were fuel surcharging, but as freight rates have gone down, we’ve reduced the cost to our customers.”

The drop in diesel prices is especially good news for Minnesota Produce Inc., as the Minneapolis-based company brings in about 90% of its products from the West Coast.

“The strength of our service that we can provide in our market is transportation,” said Paul Piazza Sr., president.

Piazza said last year’s diesel rates did cause a hike in prices for the customer, but those have come off.

“We did have to pay our truckers a much healthier rate, but we got through it just fine,” Piazza said. “You pass those costs on to the customer and it’s all forgotten about before long.”

Fuel surcharges were just one of the ways the cost of diesel was passed along.

“The nice thing about a fuel surcharge is that you can have it tied directly to the cost of diesel and change each week,” said Adam Gamble, general manager of North Country Produce, a division of Inver Grover Heights-based Russ Davis Wholesale. “It’s the fairest way.”



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Feedback Form
Leads to Insight