Industry

Coming up with an Innovative Pricing Model for a Key Customer

Electronic Vertical Management Team

We’re always looking for new and innovative ways to help our customers. That’s why they stay with DB Schenker. For most customer engagements, we provide a quote to move their products in the most expeditious ways – whether land, ocean or air.

DB Schenker has been moving freight for one major, global electronics manufacturer since the summer of 2012, but around the time for renewal in 2013, we told them that we were going to recommend a better solution for their ocean business. After a couple of months of research and negotiations with our ocean and ground carriers, we suggested a Cost Plus pricing model.

Under the Cost Plus model, we constantly monitor the prices charged by our ocean and land partners. Generally, we can book ocean passage up to two weeks before the ship leaves the port of origin. If we can find a less expensive rate, we pass that savings on to our customer and charge a fixed DB Schenker management fee on top of that to cover our cost of doing business. In this way, the customer knows we are working hard to find them the lowest rate and best delivery time to suit their needs.

Obviously, this Cost Plus model won’t work for every customer. It works here due to increased ocean carrier competition, allowing us to negotiate better rates. Because of some creative thinking and sharp negotiations utilizing a Dynamic Procurement Strategy – with ocean carriers in particular — we can look forward to more organic growth with this key customer moving forward.

Electronic Vertical Management Team

DB Schenker sponsors CCMA conference

The 102nd CCMA Conference (Aeronautical Materials Buyers Committee), held by the Latin American & Caribbean Air Transport Association (ALTA) hosted over 700 delegates in the oldest and largest aviation purchasing conference in the region, garnering the participation of over 40 airlines from Latin America and the Caribbean. As well as over 600 representatives from hundreds of aviation provider companies around the world.

For the third year in a row, DB Schenker was the Official sponsor of the 2014 CCMA.  Thomas Joly, Aerospace Business Development Manager, LATAM, and, Aerospace Country Product Manager in Mexico, Kaizad Dalal, was present at the conference.

“It’s a great opportunity to network with both the airlines in LATAM and the US suppliers/manufacturers”, said Joly.

New assignments for Fast Moving Consumer Goods

One substantial investment was made in the installation of an auto-unloading zone and the acquisition of an auto-pilot, both of which are currently being used for the new Pringles business. These make it possible to unload trucks which arrive directly from the production sites at night and during the weekends, 24/7.

In one area of the warehouse, DB Schenker has erected a mezzanine floor exclusively dedicated to co-packaging activities: this enables the logistics experts to provide their customers with best-in-class value-added services; a large part of the Nestlé products are copacked in this area, for example. The new co-packaging area offers excellent working conditions for up to 100 employees. For this, DB Schenker relies on workers from a sheltered workshop. Sofie Hofman, Head of Supply Chain Operations Belgilux at Nestlé: “With the construction of the mezzanine, DB Schenker is demonstrating its readiness to invest in long-term partnerships with its customers. Besides the major reduction of its carbon footprint, inhouse co-packing gives Nestlé the advantage of anticipating the increasing demand for flexibility and availability even better.”

The FMCG logistics center in Willebroek was erected in 2005 and is located on the Brussels Antwerp axis. It covers 85,000 square meters with a storage capacity of 85,000 pallets in five different temperature zones ranging from -22°C to +18°C and ambient temperature. “When we started our innovation program two years ago, we had a sound base: more than 30 years of expertise in FMCG logistics and a dedicated staff of about 100 employees,” summarizes Monique Van Hoof, Business Unit Director Logistics at Schenker nv. “Now we can confidently say that we offer our FMCG clients in the Benelux countries first-rate conditions for optimizing their transport and acquiring efficient time-saving value-added services.”