One Hundred Times to Spain and Back - Organizing Reusable Crates for Fruit and Vegetables

Planning Locations and Customer Allotment for Reverse Logistics at IFCO SYSTEMS

Pool service provider IFCO SYSTEMS has more than 180 locations worldwide and manages the circulation of 84 million returnable and refillable containers for its customers. IFCO SYSTEMS uses LOCOM’s software XCargo, based on Microsoft Excel, to strategically plan and optimize this very complex network.

A classical supply chain moves along the value adding chain from the raw material supplier to the producer and dealer and finally to the consumer. Yet some goods flow in the opposite direction: in recent years business has expressed increased interested in Reverse Logistics. This includes return consignment, recovery and disposal, and container logistics. Whenever reusable packaging or containers are used, they must find their way from the end destination back to the producer.

Green crates, crunchy vegetables – an inseparable duo
from the harvest to the supermarket display.

IFCO SYSTEMS is one of the leading service providers for reusable container systems. The company’s main focus is servicing its rentable pool of 84 million reusable transport containers, primarily for the transport of fruit and vegetables.

Transport Containers go Round Trip

For any one of IFCO SYSTEM’s green reusable crates the trip starts by going to the food producer who fills it with fruit or vegetables. From there, filled with apples, peaches, lettuce, tomatoes, or other fruit the crate travels to a central warehouse and then on to the supermarket where the consumer picks and chooses what he will take home. The supermarket folds down the empty crate ready for pick-up. IFCO SYSTEMS brings the empty containers to one of the 24 service centers where they are examined for damage, sorted, and cleaned. Now the reusable crate is ready to transport fruit or vegetables again. Each reusable crate circulates 100 times before it is replaced.

Systematic Container Circulation

Daily up to 3.2 million container movements –
IFCO SYSTEMS Service Center.

IFCO SYSTEMS centrally controls the entire container pool, from disposition and delivery to bringing containers back and keeping them in good condition. Daily IFCO SYSTEMS handles up to 3.2 million movements of reusable transport containers in 34 countries. This equals 385 loaded trucks everyday.

In order to control this cycle optimally, IFCO SYSTEMS uses LOCOM Software's tool XCargo. Used containers must reenter the system at the service center and then be returned to the food producer at low cost. Each service center receives orders according to its capacity. Optimizing container recycling with XCargo not only minimizes costs, but also spares the environment by ensuring that the shortest possible routes are taken.

"We sought an optimizing tool that would not only simulate our service network but also control the collection and distribution of the transport containers as a whole. In other words: We needed to optimize bi-directional flows of goods. Most software solutions only handle flow in one direction. XCargo software suits the needs of our reverse logistics and we have used it successfully since 2006" says Günter Germann, international manager for IT and logistics controlling at IFCO SYSTEMS.

Locations, Customers and Capacities

XCargo enables planning and assigning locations directly from the spreadsheet in Microsoft Excel, based on an integrated optimization method. XCargo plans how to move and control flows at the best price via hubs or distribution centers for both conventional distribution networks and reverse logistics. The maximal and the minimal capacities at hubs and transport and processing costs are included in calculations.

XCargo optimizes locations and customers
with inbound and outbound quantities.

Producing and selling fruit and vegetables is subject to considerable seasonal fluctuation – the number of transport containers needed falls or rises depending on the market situation. XCargo handles this variation in quantities. If excess crates are detected in the cycle, XCargo determines where to store them at the smallest cost.

XCargo also helped develop IFCO’s Dual Tray Pool Service, a thoroughgoing system for the distribution, presentation, and empty container return for beverage containers. IFCO’s Dual Tray Pool Service won this year’s Logistics Service Award from the German Association for Logistics (BVL). The Logistics Service Award honors the excellent performance and exemplary service of the winner from an industrial, commercial, or service providing branch.

"Every planning challenge has its own demands. Optimizing with XCargo is very flexible. It’s suitable software for a wide range of tasks" explains Dr. Christian Schmidt, expert for optimization procedures at LOCOM.

Putting Logistics Networks on the Map

Another great advantage for IFCO SYSTEMS is XCargo's integrated map presentation. These maps visualize locations, customers, transport relations, regions, and material flows worldwide with just one click – from Excel directly onto a map. The maps show geographical data and additional information, such as transport quantities.

Instead of pins or flags,
put your company logo on the map!

"One of our favorites is to use the maps for client presentations. There is hardly a better way to explain a logistics network than to show it on a map" knows Philipp Wächter, specialist for logistics projects at IFCO SYSTEMS. The newest version of XCargo has an enhanced map presentation option for individually formatting maps. The new presentation profile coordinates how elements look on the map. Company logos or other user-defined symbols can be added to the map.