Post Visit Review of Kerry Logistics

BRIEF BACKGROUND INFORMATION OF kerry logistics

Kerry Logistics is the leading third-party logistics company in ASEAN. It was founded in 1978 and its headquarters are based in Hong Kong. Although its business mainly rooted in Asia and mainland China, its business also covered globally. Kerry Logistics strives to provide services along the basic logistics mechanics, by improving logistic further into a business and provide customized services to their customers, believed to create a much smoother and effective transportation of goods.

Kerry Logistics has built a network that guaranteed to introduce and guide its customers’ businesses suitably into the global, regional and local level. Needless to say Kerry Logistics is also equipped to give out value-added services to its customers, like kitting, labelling for electronic & technology industry; GOH (Garment on hangers), Ironing for fashion & lifestyle industry etc. These kind of value-added services also contribute to its strong competitiveness in the market.

SHARING and warehouse visit

We are glad to received a sharing from the representative of Kerry Logistics about their company background, supply chain management of their operation and especially the introduction on their valued added services.Following are some important slides in the sharing sessions.

Introduction the type of warehouse by Kerry Logistics.

The KART service offered by Kerry Logistics

Here is a basic summary of Kerry Logistics. They mainly provide "Integrated Logistics" and "International Freight Forwarding" to the industries in the bottom of the slide.

Some of the value added services provided by Kerry Logistics.

Kerry Logistics also show us some videos as cases on introducing their value added services.

Their certification on the quality assurance.

Apart from having a presentation by staff of Kerry Logistics, they also bring us to the warehouse of one of their clients, Cannon, to have a direct visit. 

We are having a brief introduction on the Cannon's inventories that managed by Kerry Logistics.

Q&A SECTION

1.     What are the competitive advantages of Kerry Logistic compare with FedEx, DHL and USP?'

According to the claims by Kerry Logistics' staff, in fact logistics firms like FedEx, DHL an USP are not the direct competitors of Kerry Logistics. These firms are having the leading positions in transportation and logistics firm but in different divisions. Kerry Logistics are mainly focused on the Asian market, especially that in Mainland China. Moreover, Kerry Logistics is differentiated itself to be a B2B, while the others mentioned are usually B2C.

2.     Beside RFID, what technology have you used for inventory tracking?

Kerry Logistics as a third-party logistics company itself, actually it will be difficult to use the technology like RFID alone, without the common usage by their clients. If they set up the RFID system within their warehouse only, the costs will be quiet high. Since if the goods are located in their warehouses, those can be track easily without the RFID, but just the simple labelling. Therefore, in order to be cost effective, technology like RFID may not be used generally unless the stakeholders in the whole supply chain get used to it.

3.     Unlike your competitors, Kerry is an asset-based logistics company. Obviously, it reduces some uncertain market risk such as the raising rental cost. However, it will potentially reduce the future liquidity and flexibility in long term.  Why do you have this plan or strategy?

As a logistics company, having its own assets can actually facilitate their daily operation since hardware is an crucial elements in handling their clients' inventory. For instances, they need their own forklift trucks in order to managed the inventories in their warehouse, they also need their own truck team with their truck to transport the goods from warehouse to their clients or from clients to warehouses. Moreover,  actually some of the warehouse are actually their own assets already, so it wont a great burden that have effect on the cost.

4.     Recently, Kerry logistic proposes to reconstruct the warehouse to columbaria.  Why does Kerry have this plan instead of expanding the business so that the warehouse capacity can be fully utilized?  Is this action implied that Kerry do have confidence with your core business?

Actually it is not a decision made by Kerry Logistics but their mother firm, Kerry Properties, since they may think that it will be more profitable by turning the warehouse into columbaria. Moreover, that warehouse are located in Chai Wan and mainly documents will be stored there. Therefore, it will be even more convenient if those documents transfer to other warehouse that located in a more centered area. There won't be a large inconvenience caused to their clients.

5.     How can Kerry Logistics use the information system to enhance its effectiveness and efficiency?

   Kerry Logistics invented a smart phone app which is EPOD, by using the app the driver can get to know the places for loading their goods on truck, besides the customers can track the situation for their products. Also, the app provided multi-functions like electronic signature, sending photos and videos instantly etc. That can facilitate the customers of Kerry logistics to use their service more conveniently, and that help Kerry Logistics to keep itself in the leading market place.

6.     On your official website, you stated that you’ve provided exemplary cleaning and repair services for "your" ISO tanks. It's not clear here if the ISO tanks are provided by Kerry itself or the customer.  Could you please elaborate? 

   In fact, Kerry logistics branches in Singapore and Indonesia will help their customers to clean the ISO tanks. The ISO tanks are belongs to the customers themselves. ISO tanks which is a tank in a tank in the container and it can be pull away by using the truck and it is very convenient. But Kerry Logistics can provide the ISO tank if the customer request.

7.     What do you do to protect the goods from being damaged during transport?

  When Kerry Logistics deal with bulky goods, they will do the precaution depends on the type of goods. For example, if it’s some food or regular shaped products, it will usually pack in a box, but if it’s in irregular shape, they will handle it specially. Like canon printers, Kerry Logistics will transport it with special holders and also they will place mats on floor and wall, in order to avoid the products being damaged during the journey.

8.     How does Kerry Logistics compensate their customers for loss due to the damage of goods?

   When Kerry Logistics sign the contracts with its customers, highest liability will be mentioned in the contract terms for in case the goods are damaged by Kerry. When the goods are being damaged, it will depends on whose responsibility on it, if it’s just happen because of accident, most of the customers will not ask for the compensation from Kerry. But if that is Kerry’s responsibility, it will consider the loss of the customers and compensate them within the maximum liability amount stated in the contract term.

9.     How does KerrierVISION support your operation?

KerrierVISION is a system similar to EPOD, it allows Kerry’s customers to check the shipments as well as the freight movements. It increased visibility, accessibility as well as the connectivity within Kerry and its customers. The system provides customers’ inventory level, freight information, purchase order and delivery tracking, these all contributing to increase cost effectiveness for its clients. And also it makes the operation more systematic and simple which incurred less operation cost too.

SUMMARY

By visiting Kerry Logistics, we have a close look of  Hong Kong's transportation and logistics industry and a detailed introduction of Kerry Logistics itself, especially there is a hit issue that about the columbaria recently. We have a great lesson from Kerry Logistics and their real project of Cannon make our understanding much more clearly.

REFLECTION

We earned a lot in this visit. In the past, we always think that logistic is only about transporting goods from one place to another, but after this visit, we know that it is not so simple. In order to run a logistic company successfully, both software and hardware are very important. No doubt that trucks and staff are crucial for a logistic company, but information system is also a key reason for leading to success. For example, like Kerry Logistics’ KerrierVISION enables its customers to track the shipments and freights movement of their goods, and that’s the value-added part for Kerry’s business. Besides, networking is very important too. KART is the unique road transport route in order to deal with the increasing demand for road services connecting places in ASEAN. In order to build this transport network, it required Kerry to have a very good relationship with many different countries’ governments and in fact Kerry did that. Besides, Kerry itself, FedEx and other logistic companies also make use of that. we think that Kerry Logistics is a very all-rounded logistic company and we do think that they can maintain its leading place in the industry as long as they keep improving along its recent strategies. But in our opinion, although most of the companies will have backup for their information system, too rely on it will lead to serious lost once the system crash down.

REFERENCE

http://www.kerrylogistics.com/eng/OUR_EXPERTISE/InternationalFreightForward/roadrailfreight/kart/kart.jsp

http://www.kerrylogistics.com/eng/main/kerriervision.jsp

http://www.kerrylogistics.com/eng/main/index.jsp?FromURL=web