[ APL Awarded Multi-Year Logistics Operation Contra... ]

APL Awarded Multi-Year Logistics Operation Contract by DuPont

The business logistics unit of APL has been awarded a multi-year contr
act for third-party logistics operation services by DuPont, based in W
ilmington, Delaware.
The contract, under which APL will manage and network DuPont’s North
America distribution activities, follows successful completion of a pr
evious three-yar contract, according to Hugh L. Fischer, DuPont’s man
ager - Distribution Operations. During that period, Fischer said APL h
elped DuPont’s chemicals and specialties business units reduce transp
ortation costs and in-transit damage, and maintain a 99.37 percent on-
time delivery record for shipments within the United States.
“We found that APL’s services essentially paid for themselves,” add
ed Stanley Pang, DuPont’s manager - Distribution Contractors. “In ot
her words, the savings through logistics profects and customer-service
benefits are recurring for DuPont on an annual basis, with almost no
incremental cost.”
The new contract is one of the largest in the fast-growing third-party
logistics industry, in which major manufactures and retailers are ret
aining professional logistics managers and consultants to help them im
prove the cost-effectiveness of their distribution activities.
“The industry is estimated to be worth more than $25 billion annually
and is expected to grow to $50 billion by the year 2000,” said Mitsu
ko Mizushima, vice president of APL’s logistics group, based in Oakla
nd, California. “Companies such as DuPont are interested in outsourci
ng these specialized capabilities,” said Mizushima, “because it enab
les them to focus on strategic business operations while improving the
economics of their supply-chain activities.”
In general, APL has been responsible for scheduling and managing shipm
ents of both purchased materials and finished products between most of
DuPont’s 400 shipping sites and the thousands of vendors and custome
rs of its 18 business units, several of which are equivalent in size t
o Fortune 100 companies. APL also ensures that carriers meet required
quality and performance standards, and manages the freight optimizatio
n program.
According to Neil O’Connell, APL’s managing director of Contract Log
istics, based in Wilmington, APL will place special emphasis on settin
g up improved information capabilities for DuPont that will give a hig
her level of visibility to the approximately 250,000~300,000 orders th
at APL dispatches annually for the company, mostly by truck, so they c
an be better managed. “The system we are developing for DuPont will u
se highly automated order interfaces, EDI and other electronic means t
o connect the company with various parties in its distribution chain.
This information will allow us to help DuPont further optimize freight
distribution,” he said.
APL was previously and will continue to be primarily responsible for m
anaging logistics operation activities for DuPont in the United States
. The new contract requires that APL collaborate with DuPont Canada an
d DuPont Mexico logistics operations to streamline the distribution pr
ocesses and systems for DuPont in North America, said O’Connell.
Other new areas of responsibility for APL under the long-term contract
include U.S. domestic carrier performance management and processing d
omestic cargo claims, warehousing invoices, and freight payment reconc
iliation for DuPont’s third-party shipments. APL will also develop an
asset-management system for DuPont’s ISO tanks and other equipment u
sed in transportation and storage of various products originating in t
he United States.
Also, APL will manage DuPont’s Carrier Commitment Progran(CCP), under
which DuPont awards business to motor carriers based on their ability
to meet service expectations at a competitive cost. APL will also wor
k with DuPont’s procurement and business units to align their transpo
rtation-procurement policies more closely with operating needs.
APL manages DuPont’s transportation and logistics operations, known a
s “Transoval North America”(TONA), with a team of 25 specialists in
Wilmington and another 36 at DuPont’s load center at Charlotte, North
Carolina.