Guide

A guide to efficient cold chain logistics

In perishables logistics, planning is everything. One can set up the perfect production line yet struggle with delivering quality if the product loses freshness on the way to the market. That’s why, in the case of segments with brief shelf lives, supply chains must be primed for resilience, product longevity, disruption management and efficient collaboration.

So, let's go through some of the top challenges of cold chain logistics and determine the best ways of moving them safely, with minimum hassle.

A representation of the refrigerated cargo commodities and the common challenges in cold chain logistics.

Tracking, Monitoring and Quality control

Perishables don’t last long. Be it medicines, fruits, vegetables, protein, dairy, or seafood, without the right ambient conditions maintaining freshness or flavour is an impossible feat. Fortunately, cold chain technologies have come a long way and offer far more options than just cold or hot settings. There are state-of-the-art technologies in the market that help monitor conditions inside a container and provide a real-time view of location, temperature, humidity, oxygen, and carbon dioxide levels. That's not all. Should market situations change, shippers can use the available knowledge to redirect cargo to more favourable destinations.

In 2020, when China imposed restrictions on pork during the Covid-19 pandemic, cargo owners were able to minimise their losses by evaluating their shipments’ condition and diverting to other open ports.

An illustration of a woman tracking cargo on her laptop with a Maersk truck and banana cartons behind her.

Time-to-market

Whenever demand fluctuates due to shifts in volume, poorly planned supply chains struggle with time-to-market. Instead of identifying the root cause and implementing a focused solution, they turn the entire setup upside down, leading to costly and complicated outcomes.

For a hyperlocal metric like time-to-market, proximity to the destination markets can provide better results. Local cold storage are proven examples of how time-to-market can improve while reducing recurring transit costs.

Some chilled meat and seafood commodities can last up to 90 days from the production, when transported in a temperature-controlled supply chain. So, any delay in the transport reduces the supermarket's window of sale. A local cold store can handle such scenarios easily.

Perishable goods - An illustration of a man pushing a trolley with a variety of fruits at a store.

Equipment availability

Due to their fragile composition, perishables rely heavily on the availability of equipment since even the slightest of delays can setback the entire supply chain by days, resulting in wastage and loss of revenue. To ensure constant availability, some setups allow demand to guide the inventory. However, since the market conditions change frequently, most supply chains maintain buffer reserves to eliminate all shortage risks.

Even though all perishables businesses make provisions for buffer stock of specialised containers, it’s especially most critical for pharmaceuticals, and fruits and vegetables, due to high demand throughout the year.

An illustration of a worker in a vehicle with packed perishable cargo boxes in the background at a Maersk site.

Disruptions

Before Covid-19, risk diversification was a popular area of focus across industries. However, within a few months into the pandemic, businesses were pushed back into concentrated pockets of trade as select regions reopened their markets before others.

Today, even though more markets have opened, the lop-sided trade equations are expected to continue for some more time in the form of unilateral risk concentration and increased costs. Until situations normalise, supply chains must allocate adequate resources to the dominant markets to prevent further loss on profit margins.

As far as more common but less severe disruptions are concerned, digital solutions and dashboards can help in identifying the demand patterns and aid decisions based on historical data.

Cold chain logistics – An illustration of a man with a laptop, dashboards, digital solutions and a Maersk truck.

Unique challenges for commodities

While there are several challenges that are common across the entire perishables segment, there are a few that apply more to one segment more than the others. Let’s see what they are.

Compliance and Regulations

Pharmaceutical supply chains have a greater responsibility than delivering products. They are critical in ensuring timely and high-quality care for everyone, compliance crucial.

Pharmaceutical manufacturers must comply with the latest Good Distribution Practice (GDP) guidelines to ensure distribution of safe, effective, and contamination-free shipments. To do so effectively, it's important to focus on internal controls and build a supply chain where all partners comply fully with local regulations from across the globe.

An illustration of compliance and regulations involved in pharmaceutical supply chains.

Peak season rush

In the fruit and vegetable sector, a change in season means a significant change in demand. Whether a business caters to a global market or to a local consumer base, having a reliable, ready-to-mobilise logistical setup is a must. However, one critical capability that often gets overlooked is tracking the changes in consumer preferences. Until a few years ago, global seasonality was a leading consumption pattern. More recently, the emphasis has been on local consumption. In either case, finding a logistics partner who focuses on trends, recalibrates swiftly, and mobilises quickly, will go a long way in prioritising the right market.

A graphical illustration of demand in peak season in the fruit and vegetable sector.

Cargo security

When a product traverses multiple borders, regional issues like illegal trade and security threats are not uncommon. And different providers have different ways of managing them. However, a reliable partner will always ensure that the product's journey remains unaffected even if the solutions are not within the scope of "typical logistics".
In the likelihood of potential security breaches along the way,

Inspections before dispatch and during transit can eliminate a lot of hassle later on.
Illegal trade proliferates when multiple parties are involved. This can be eliminated by reducing the number of providers. The fewer, the better.
Equip the containers with ultra-secure locking mechanisms that can also double up as GPS trackers reporting the movement or stationary location of the containers.

Bananas moving out of Ecuador are among the most vulnerable shipments in the world.

An illustration of solutions for cargo security for bananas and pineapples.

Push production environment

The pork and chicken industry follows a push-production format where every step of the production depends on a previous step. Any delay or lack of synchronisation usually comes at a high cost. To ensure an uninterrupted production line on a day-to-day basis, the presence of a reliable logistical setup is a must. And what could that entail? A setup that can improve handovers between the stakeholders and minimise dependency on cold stores.

Optimisation of a push production format is a factor of multiple solutions like shipment tracking and equipment availability. Since one step can only begin when another ends, ensuring that everything is ready when needed is extremely important.

An illustration of shipment tracking process to handover in protein and dairy industry.

Multi-party coordination

A typical banana or fish & seafood supply chain consists of four to five vendors between the farm and the destination market, presenting two possibilities:

A rare scenario where all parties are in sync and the product covers the entire journey without any untowardly event, or,
One or more parties miss a connection, and the whole delivery system falls apart.

We know that the former is ideal, but extremely difficult to achieve. Digital dashboards, in such cases, have proven time and again to be effective in aligning multiple stakeholders with the help of live data feeds and status checks.

Recently, 4PL services have gained traction, where a 4PL provider, in addition to managing entire cold chain logistics between origin and destination, also manages 3PL providers.

Fish & Seafood supply chain - An illustration of digital dashboards and 3PL services.

Going the extra mile for extra care

Cold chain logistics is a delicate matter requiring utmost precision in handling – right from timing the handovers to managing the in-transit temperature controls and safe delivery at the destination. To make sure that your products reach theirs in the condition that you’d like, make sure that your supply chain setup or provider has the capabilities, coverage and a team that is ready to go the extra mile whenever needed.