5 Ways a Cold Chain is different from a typical Supply Chain (Temperature Controlled Transportation)
Most people in Logistics are familiar with a supply chain. But the term “cold chain” and what it represents is much less understood in the industry. If one had to guess at its definition you might say it’s a supply chain that uses temperature controlled equipment. Though this definition would be partially correct, it falls way short of capturing all the complexities of a cold chain. In an attempt to shed some light on what comprises a cold chain, here are 5 ways it differs from a typical supply chain.
#1: Refrigerated Containers
As mentioned above, refrigerated containers (i.e. reefers) are the most obvious difference between a cold chain and a typical supply chain. Here are a few interesting facts about reefers that you might not know.
• While a regular 40’ ocean container costs ~$5k, a reefer the same size costs 6x more.
• Reefers are only designed to maintain the cargo temperature within a prefixed range, not to cool it down. Which means the shipment must be already at the required temperature before being loaded.
• Reefers require a generator set (genset) for electric power during transportation and storage at a container yard. The gensets come in two types, a clip-on version that attaches to the upper front end of the container, and an underslung version that mounts under the trailer chassis.
• For ocean and rail modes that ship multiple containers at a time, the on-board power capacity becomes the limiting factor for how many reefers can be moved.
• All reefers are painted white to reduce the amount of solar energy absorbed on the exposed surface
#2: Same operations, just more complicated
When working within a cold chain many of the operations related to a typical supply chain still exist. However, they tend to be much more complicated with higher risks. Here are some examples.
Ship preparation – before a temperature sensitive product can be loaded, it’s initial characteristics need to be assessed and documented. As mentioned above, reefers aren’t designed to bring a shipment to its prime temperature. If a product is compromised before being loaded the carrier needs to protect themselves by documenting all details of the load.
Mode – in a typical supply chain cost and transit time are usually the main drivers when choosing the shipping mode. In a cold chain the modal choice is driven more by the cost/ perishability ratio. For example, the required exterior temperature environment of the product could force a shipper to choose one mode over another.
Customs – while customs procedures can cause issues for typical loads, with cold chain products the risk is much higher. Because cold chain products are time sensitive and more subject to inspection than regular freight (e.g. produce, pharmaceuticals, etc.), customs become a very important and critical point of the cold chain.
The “Last Mile” – The last stage of shipment is the actual delivery to its destination, which in logistics is often known as the “last mile.” When arranging final delivery of cold chain products many considerations need to be accounted for to ensure the integrity of the shipment. For example, the delivery timing is important to ensure that critical labor and temp-controlled warehouse space is available. Also, because many cold chain deliveries occur in downtown urban environments, something as simple as parking availability can have detrimental impacts on the shipment. Also important is the final transfer of the shipment into the cold storage facilities as there is potential for a breach of integrity.
#3: Requires adept understanding of perishability and the means of prevention
When transporting food in the United States the guidelines of the FDA Food Safety Modernization Act (FSMA) come into effect. This means that Shippers must be trained on defining the temperature and sanitation specs for their products. Carriers, on the other hand, are required to know how to maintain their vehicles in accordance with proper sanitation practices. They must also be trained on how to monitor their cargo while in transit; making sure defined temps are maintained throughout. Lastly, at the destination the training is focused around safe food handling and what items to consider before accepting food deliveries.
#4: More integrated than a typical Supply Chain
Because cold chains require a higher level of end-to-end control in order to maintain product integrity, they tend to have higher levels of integration among its members. For example, a 3PL (3rd Party Logistics) provider might choose to acquire upstream elements of the supply chain to obtain more control over time and temperature factors. Another integration example is a process called source loading, where goods are loaded directly onto a reefer at the place of production. Source loading has been proven as an effective way of extending the shelf life of a cold chain product by eliminating additional handling (that adds risk to the product integrity). For instance, source loading into a reefer can expand the shelf life of chilled meat by about 25 days (from 30-35 days to 55-60 days) from conventional methods and in turn expand the market potential of the product.
#5: Has an impact on public health
The cold chain is a public health issue in two different ways. The first, and most obvious, is that properly transported food products reduce the likeliness of bacterial, microbial, and fungal contamination of the shipment. This is especially important in underdeveloped regions. Secondly, an effective cold chain becomes a critical means for sending temperature-dependent medical goods over long distances. The 2015 Ebola epidemic showed the world how important a role the cold chain plays in distributing vaccines as quickly as possible to contain an outbreak. In fact, the World Health Organization (WHO) realizes the importance of national vaccine cold chains and sees growth in this area as a key building block of their Global Vaccine Action Plan (GVAP).