Its allure dates back to the Aztec and Maya civilisations in 1900 BC, and today, there are few who can resist the sweet temptation of chocolate. But behind that shiny packaging and the silky, sweet indulgence within, is a complex logistics challenge. It’s a challenge that Imperial Logistics group company TFD Network Africa has risen to, since becoming the integrated logistics service provider for Beacon, as well as premium European brands Lindt and Ferrero.
The company, which over 35 years, has become a leader in the Third Party Logistics (3PL) arena, is growing its confectionary business – and has invested in the specialised skills and resources to succeed in this testing sector – with positive spin-offs for new and existing clients.
According to managing director Hein van Waveren, one of the greatest challenges in confectionary is temperature control. With its background in ambient FMCG products, TFD needed to gear up for the refrigeration required throughout the supply chain when working with chocolate, he states. “European chocolate is especially heat sensitive, so we are now running a refrigerated fleet.”
TFD’s warehousing has also been tailored to meet its confectionary clients’ requirements, with a refrigerated depot in Johannesburg, and refrigerated sections – dubbed “choc boxes” – within the company’s facilities in Durban and Cape Town. Refrigerated containers are also catered for, with TFD’s depots boasting “plug-ins” for these. TFD has the capacity to handle containers, van Waveren notes, including unpacking these by hand when necessary – a practice known as “handballing” in the industry. In addition, high-tech refrigerated “docking” stations are provided for refrigerated vehicles. “We are one of the fewplayers in the industry to offer a total refrigerated solution,”van Waveren stresses.
TFD’s burgeoning experience in confectionary goes beyond its own resources, and the company is also working closely with its confectionary clients to understand – and be actively involved in – their temperature and humidity-checking technology and data. The organisation’s European confectionary clients utilise a state-of-the-art “sensi-tech” device to constantly record temperature and humidity throughout their products’ movement along the supply chain, van Waveren says. “TFD is able to download and review this data, and alert the client of any potentially problematic variations in temperature and humidity.”
Up skilling its existing staff and boosting its capacity has also contributed to TFD’s increasingly sweet success in the confectionary business. “Employees need special training to understand the unique demands of confectionary,” he explains. “In terms of refrigeration, it’s not just the warehouse staff that must have an understanding of the product’s heat sensitivity. It’s drivers and crew, too. What good is a refrigerated warehouse and vehicle, if the product is unloaded in the sun?”
Also a significant factor – and logistics challenge – is the fragility of the product, and employees in all areas need training on product handling. Communication along the entire supply chain is critical, van Waveren says, in order to maintain visibility and ensure the smooth transfer of the confectionary from one link to the other. TFD works closely with the stores and distribution centres – some 3 000 locations in total for its confectionary business – and there is constant communication between vehicles, stores, DCs and TFD’s facilities, he states.
Batch-picking forms part of TFD’s role, and with confectionary’s high quality standards – particularly for imported chocolates – this is a resource-intensive operation that entails double-checking everything, to ensure that the clients’ standards are met. Van Waveren elaborates: “Batch-picking covers stock rotation, and the selection of product for delivery based on expiration dates. One of our European principals will uplift product if it expires within three months. Freshness is critical, and there is an unswerving commitment to quality. This demands flawless batch and data accuracy from TFD, as well as exceptional diligence in managing this department. TFD has built up a huge centre of expertise in confectionary in a relatively short space of time,”he adds.
Co-packing also forms part of the company’s service offering, and Van Waveren explains that this entails taking bulk material (like individual chocolates), and creating a product, including re-packing and labelling. “In this area, too, quality is critical, since luxury confectionary brands demand not just a perfect product, but pristine packaging that is in line with their premium brand positioning. In all areas, we follow international best practices, and are complying with our European confectionary clients’ stringent international standards, but within the complex, diverse and high-risk South African environment.”
Instore merchandising doesn’t usually go hand-in-hand with outsourced logistics, but TFD is adding value for its confectionary clients with its point of sale service offering. “We have the capacity to build display stands, and are doing this as a value add for our confectionary clients,” says Van Waveren. “We ensure that the stands arrive in-store with the product. Since the stands, like the product, are fragile, and are often irregular in shape and size, we have had some challenges. However, this reflects TFD’s commitment to offering more; to going the extra mile. There is much more to our confectionary offering than just moving the product from the warehouse to the store shelf!”
Another value add from TFD is the destruction of old or damaged stock – which is particularly important with premium, imported brands, Van Waveren states. “To stop the risk of the product – or even the packaging – getting back into circulation, possibly for resale on the black market, we have a compactor in our facility. Product that isn’t compacted is safely disposed of, with lockable bins provided.”
TFD ensures that it has the capacity to deal with confectionary’s peak periods – mainly ahead of Easter, Christmas and Valentine’s Day – by bringing in additional labour and working overtime.
On the reverse logistics front, the company has also established a constant queries department, to follow up and monitor all confectionary returns.
van Waveren stresses that while TFD has built up unrivalled expertise in confectionary, the organisation is not offering its clients a “one-size-fits-all” solution.“We have created the capacity – from a resource and infrastructure perspective – to meet the challenges of the confectionary industry, and we have a supply chain model that we are able to optimise for the benefit of all our confectionary clients. Our growing expertise in this area, and our growing confectionary business, certainly benefits all of our clients, enabling us to drive their costs down by capitalising on economies of scale, co-loading and the optimal utilisation of warehouse space and resources. What we learn from one client, and the skills and capacity we acquire, is undeniably beneficial to the next one. We are even looking at how our focus on confectionary can benefit clients in other sectors.
“But”,van Waveren emphasises, “we are still maintaining our focus on each of our clients’ unique requirements. From dark to white, chilli to mint and bunnies to eggs – the world of chocolate is diverse. At TFD, we understand this, and we are committed to ensuring that our clients reap the benefits of our focus on confectionary, but still get the complete, tailored solutions they require.”