“Tell us what you want”
Century shapes IT and logistics services around shipper requirements.
Forty-seven-year industry veteran Iain Aitchison’s pet peeve with logistics services providers is they generally don’t listen.
While head of international freight transportation for 128 Carter Hawley Hall department stores in the mid-1980s, numerous consolidator and freight forwarder representatives marched through his door, offering what they believed to be the right services for the shipper. ‘They didn’t understand what I wanted,’ Aitchison said in a recent interview.
When ‘K’ Line asked him to head up its Century Distribution Systems subsidiary in 1987, he was determined to ask the shipper: ‘Tell us what you want.’
‘I think our success has always been based on listening to the customer, and that’s something that I wanted to instill in Century going forward,’ said Aitchison, president and chief executive officer of the company, which encompasses the Century Division and Universal Warehouse Co.
|
|
|
| Iain Aitchison president and chief executive officer, Century Distribution Systems |
|
| ‘Our success has always been based on listening to the customer.’ | |
|
|
|
Based on this corporate mindset, Century has grown over the past 20 years from a small entity founded in 1969 as the Tokyo Overseas Forwarding Co. into an operation that manages the import freight logistics for numerous clients across North America.
‘They’re listeners, not talkers,’ said Steven A. Cohen, director of global logistics for American Signature, a furniture importer that took on Century as its exclusive logistics services provider in 2004. ‘That’s what’s kept them with us.’
American Signature previously worked with one of the largest U.S. forwarders for its import requirements. As the company’s logistics requirements evolved and became increasingly detailed, Cohen said the forwarder simply couldn’t deliver. ‘Century was very partner friendly. They were able to accommodate us.’
Trevor LaChapelle, vice president of global transportation for U.S. East Coast retailer BJ’s Wholesale Club, cited similar reasons for his company choosing Century as its exclusive logistics services provider. ‘They have an open mind to what we’re looking for,’ he said.
In 2007, BJ’s reevaluated its logistics operation and brought in a dozen forwarders to offer presentations about their services. BJ’s has 189 stores and three distribution centers along the eastern seaboard. Most of its containers arrive via all-water services from Asia at East Coast ports.
‘Century was the clear winner,’ LaChapelle said. ‘We were able to ease into all their service offerings to ensure our operations remained intact during the transition.’
IT Driven. One of Century’s attractions for shippers has been its information technology development.
Aitchison said he was never a fan of the restrictive data channels imposed by the costly mainframe-to-mainframe programs that permeated the shipping industry during the mid- to late 1980s. ‘When I returned to ‘K’ Line, I decided that Century would not have mainframes. We had to be PC-based,’ he said.
Flexible PC technology also allowed Century to embrace the Internet early on. In 1998, the company introduced Internet tracking software. Century’s in-house technical staff, led by Jim McCullen, vice president of information systems, has continuously enhanced the system.
In 2002, Century introduced its Web-based VMS program initially to provide online cargo booking capability, and the system has evolved rapidly based on ever-changing customer requirements.
‘The key differentiators that set Century apart from other 3PLs are speed to market with customized IT solutions (software as a service) and our ability to drive continuous process improvement after the initial deployment ‘ all of this uniformly and on a global basis,’ McCullen said.
‘Implementation is a straightforward undertaking typically achieved in 60 to 90 days, resulting in immediate, turnkey benefits for the importer,’ he explained. ‘The desktop tools and customized reporting in VMS empower the importer to eliminate cumbersome, manual spreadsheets and focus personnel on exception management.’
Century employs a dedicated implementation team, based in Richmond, Va., and Iselin, N.J., that tracks deliverables and timeframes promised to new customers. A standard program involves implementation of 850, 856 and 315 electronic-data-interchange interfaces. Additional EDI integration and enhancements are rolled out in phases as outlined by Century’s ‘road map’ for the partnership, McCullen said.
The VMS platform supports the day-to-day operations Century performs and provides complete supply chain visibility and control for Century’s customers through a Web-based platform. Thus there are no capital expenditures on the part of the shipper to get up and running with Century’s system.
‘VMS provides end-to-end supply chain visibility, customized for each user’s role, in one Internet-based platform,’ McCullen said. ‘To accomplish this, we have established EDI interfaces with our customers’ supply chain partners. Events from these parties are integrated into VMS, giving our customers visibility to current status at the B/L (bill of lading), container, PO (purchase order) and SKU (stock-keeping unit) levels. There is no need for the customer to access multiple systems to track their orders.’
As an inbound freight management tool, VMS captures container status events from carriers, brokers, railroads, distribution centers, truckers, transloaders and customers. McCullen said carriers alone are capable of sending more than 95 different container event messages, most of which Century then relate down to the purchase order level in VMS.
Century also allows shippers to track their inbound containers transported by rail. The company worked with Steelroads, a central rail track-and-trace database connected to all the major North American railroads, to develop this ‘en route’ interface.
The system is widely used by Century’s customers and their overseas suppliers. For example, today more than 4,000 vendor users interact with Century’s supplier portal in VMS, and more than 85 percent of its customers use the online booking function. ‘Our goal is not to replace their internal systems, but to give them more value,’ McCullen said.
‘Now we have one system and we make it available from beginning to end. Our buyers, warehouse staff and store managers can all see the estimated arrival times,’ American Signature’s Cohen said. ‘There’s no more guessing about when the furniture will come.’
Canadian Tire Corp., which relies on Century to help it manage imports from 26 countries, appreciates the consistency and standardization in data flow that VMS offers its supply chain. ‘Despite the many different vendors and SKUs we have, we’re able to have one flavor no matter where the products come from,’ said Neil McKenna, the company’s vice president of transportation.
McCullen said most improvements and enhancements to VMS are driven by individual customers, and once perfected are later made available to other Century customers.
‘They’re very interested in what their customers are doing next,’ said LaChapelle of BJ’s. For example, BJ’s has implemented Century’s Customs-Trade Partnership Against Terrorism certification support in VMS, which handles the collection, review and approval of C-TPAT surveys and inspections required to satisfy C-TPAT requirements of U.S. Customs and Border Protection. Each time a new manufacturing site is added, VMS initiates a process to collect the appropriate documents from the supplier and blocks bookings until this information is complete and approved.
Recently, Century worked with American Signature, which imports about 14,000 containers of merchandise a year, to develop a module to help the shipper manage its compliance with U.S. Consumer Product Safety Commission (CPSC) requirements. Here’s how the process basically works:
‘ American Signature issues a purchase order to the vendor and transmits the 850 EDI message to VMS. (In the near future, the POs will be delivered to the vendors through the VMS supplier portal.)
‘ The vendor receives the real time notification (RTN) on its VMS desktop advising it has a PO that requires CPSC information.
‘ The vendor completes the online form in VMS and transmits the information directly to VMS.
‘ A compliance team member at American Signature receives an RTN on his or her desktop with the completed CPSC form. That person reviews the form, makes necessary adjustments and then approves it.
‘ When Century prints off the final shipping advice and document coversheet, the completed and approved CPSC certificate prints off to be included with the documents.
American Signature moved the entire CPSC process from the ‘time crunched period between booking and shipping back to when the purchase order is issued, which provides sufficient time to resolve any issues and assure the document is accurate and completed well in advance of the cargo movement,’ McCullen said. ‘Our plan is to offer this module to other customers in the future.’
Boots On Ground. Century has long focused on the import market from Asia to North America. For years, the company has had a presence in Japan, Hong Kong, South Korea and Taiwan. Today, Century operates 41 offices covering 62 ports and inland shipping hubs in Asia, Indian Subcontinent, Americas, Europe and South Africa.
When China opened up in the late 1990s, Century was ready to jump immediately into the market. China now generates the largest customer freight volumes for the company. ‘Simply put, China is difficult to beat on a cost basis,’ said Mark Gorman, president of the Century Division, focusing on buyers’ consolidation and logistics management.
|
|
|
| Mark Gorman president, Centry Division |
 |
| ‘A lot of customers have emerged organically into large volume accounts. Our top five customers today have grown with us.’ | |
|
|
|
The Chinese outbound market has also changed the way Century serves its customers from Asia.
‘Origin VAS (value-added services) is a fast growing area for Century,’ Gorman said. ‘In particular, we’re seeing heightened interest in China’s bonded logistics parks as a means of reducing cost and increasing supply chain velocity.’
Some examples of VAS programs offered by Century include:
‘ Move from FOB (free onboard) to Ex-Factory or FCA (free alongside ship), meaning Century will manage local trucking.
‘ Shift from factory stuffing to consolidation at Century facilities.
‘ Pre-distribution in which Century builds loads at its warehouses based on the North American customer’s current inventory needs.
‘ DC bypass, meaning Century builds loads for direct shipment to retail stores.
‘ Labeling, ticketing, bar code scanning, light assembly, and green packaging.
Having a physical presence in China and other Asian markets also allows Century to assist suppliers on behalf of its North American customers, Gorman said.
‘We were interested in having some boots on the ground overseas,’ LaChapelle of BJ’s said. ‘That’s one of the roots for us choosing Century as our logistics provider.’
VAS programs can be extended through destination services offered by the Universal Warehouse division of Century, which include public warehousing, trucking, transload and product rework services. The facilities are located on the West Coast at Long Beach, Calif., and Auburn, Wash.
Today, Century handles an array of large shippers, many of whom started out working with the company as small to midsized shippers.
‘Since the early 1990s, a lot of customers have emerged organically into large volume accounts. Our top five customers today have grown with us,’ Gorman said.
‘One of the most attractive things about Century is that when they came to us (about 10 years ago) they weren’t looking to go after customers with the largest volumes of containers,’ Canadian Tire’s McKenna said. ‘Their willingness to work with us allowed us to get things done.’
‘Adding Value.’ Yet customer loyalty has not lulled Century into complacency. The logistics sector is highly competitive and shippers constantly explore their options among service providers to reduce costs and make their supply chains more efficient.
Century provides its customers ‘scorecards’ to identify chronic service issues. ‘We have created customized reports that evaluate performance of all the key supply chain partners, ourselves included,’ Gorman said.
‘We measure carriers based on actual versus published transit times, 315 exceptions, and service failures entered in VMS by our origin teams and the customer,’ he added. ‘Century scorecards assist our customers with carrier selection and rate negotiations.
 |
| McCullen |
‘We measure vendors based on PO fulfillment stats, on-time booking, on-time delivery, on-time documents and container utilization/optimization,’ he said. ‘We measure ourselves based on FCR (forwarder’s cargo receipt) issuance, timely document scanning, timely ASN (advance shipping notice) transmission, CFS/CY (container freight station/container yard) load maximization, and vendor booking confirmation.’
Cohen said American Signature maintains a logistics improvements ‘to-do list,’ which it provides to Century. ‘We’re always looking to make our system better,’ he said.
‘Customization will be a service that we’ll continue to provide our customers,’ Gorman said. ‘We like to have an active docket of what we’ll do next.’
Some of Century’s customers want to manage their domestic suppliers with the tools in place for their overseas suppliers. In response, Century recently extended VMS to manage ground shipments moving within North America.
‘VMS Ground provides shippers with real-time visibility to shipments from North American suppliers to their distribution centers,’ McCullen said. ‘The module includes EDI exchanges with truckers to manage the load tender process.’
‘I often say we have better visibility of our products coming from Shanghai and Hong Kong than we have from locations like Detroit and Chicago,’ McKenna said. VMS Ground ‘is definitely something we’ll look at. Based on Century’s track record, I don’t see why we wouldn’t use it.’
The first release of VMS Ground occurred in July with enhancements planned throughout 2010.
‘There’s no end point to what we need to do,’ McCullen said. ‘In our business, you have to demonstrate that you’re continuously adding value.’