Yamato Group Solutions

 

Dramatically Reducing Lead Times and Logistics Costs for Export and Import Businesses 
Global Direct Solutions

Reducing Costs using Non-Asset, Non-Inventory Operations

While the number of companies that manufacture products in emerging countries like China is increasing, the number of companies that sell products in these emerging countries that have become more appealing as consumer markets is also on the rise. As a result, the global flow of products is growing and intensifying on almost a daily basis. Therefore, when providing faster delivery of products, the control of total logistics costs is also required. To this end, the Yamato Group began offering its "Yamato Global Direct" solutions in February of 2009. These solutions help reduce the total lead time from Japan to overseas markets and cut costs. For example, for imports to Japan, the Yamato Group offers a "3 days service" from origin to final destination in Japan by sorting products and affixing TA-Q-BIN connote label while the product is still outside of Japan, enabling delivery to the final destination in Japan directly. These solutions greatly reduce costs by bypassing distribution centers located in Japan. 
(Reporting and editing by Nikkei BP Consulting Inc.)

Chapter-03.

Application for Products for which Freshness is Important led to Extended Product Shelf Life and Sales Expansion 
Fulfillment of Both Lead Time and Cost Reduction

Photo
Masasumi Kito
General Manager
Global Direct Division
YAMATO GLOBAL LOGISTICS JAPAN CO., LTD.

Reducing lead time by using "Yamato Global Direct" for freshness-sensitive products will help boost sales. At a home improvement store that is expanding nationwide in Japan, "Yamato Global Direct" has been implemented for the import of cut flowers from South Korea. As a result, the former lead time of 2 weeks has been shortened to 5 days. In the past, products were imported from South Korea by sea freight through the company's own distribution center in Japan and then delivered to stores nationwide. But after the implementation of "Yamato Global Direct" solution, the routing was changed so that products were imported from South Korea by ferry through a Yamato distribution center (not through customer's facility) and then delivered to stores nationwide directly. Kito explains the results as follows: "When it comes to cut flowers, freshness is very important. Sales periods can be lengthened if lead time is reduced. Of course, waste from product spoilage was reduced, while sales volume rose. Because costs have been reduced by about 20% by saving and improving the shipment's routing, it's like killing two birds with one stone."

This business model has quickly expanded throughout the industry, and has been adopted by other home improvement stores one after another. Furthermore, in addition to home improvement stores, the Yamato Group proposed a solution called "Flower Direct" to customers importing cut flowers from South Korea and China. Using this service, companies import cut flowers utilizing ferries from South Korea and China, meaning that deliveries can be made using temparature contorolled delivery mode called "COOL TA-Q-BIN" in as quickly as 3 days from Pusan, South Korea, and 4 days from Shanghai, China. "Because customs clearance is available even on weekends and holidays, enabling delivery to stores 365 days a year, the service can be utilized with extraordinary flexibility," says Kito.

This ferry-based solution for cut flowers has been eyed as an effective shipping method for "Yamato Global Direct". This is because the lead time of the high-speed ferries used by the Yamato Group is shorter than container ships, while shipments also cost less than airfreight. For example, when transporting 30 units of 140 size* cargo door-to-door from Shanghai to Chuo-ku in Tokyo, a container ship would require 11 days of lead time and cost 50,000 yen, with airfreight requiring 4 days of lead time and 230,000 yen. However, high speed ferry requires 5 days of lead time and costs 150,000 yen. The lead time is 6 days shorter than a container ship and costs about 35% less than for airfreight.

*Weight: 20kg – Volume: 0.08m3


  • 01
  • 02
  • 03
  • 04
  • 05
  • (Previous) Anticipating Advantages from the Import of Various Commodities
  • (Next) Expansion of TA-Q-BIN Services throughout East Asia draws Attention from Overseas On-line Shopping Businesses

<Global Direct Solutions> 
Dramatically Reducing Lead Times and Logistics Costs for Export and Import Businesses

  • Chapter-01. 
3 Days Service from On-Site Factories in Shanghai to Destinations within Japan
  • Chapter-02. 
Anticipating Advantages from the Import of Various Commodities
  • Chapter-03. 
Application for Products for which Freshness is Important led to Extended Product Shelf Life and Sales Expansion
  • Chapter-04. 
Expansion of TA-Q-BIN Services throughout East Asia draws Attention from Overseas On-line Shopping Businesses
  • Chapter-05. 
Increasing Capacity via Haneda Logistics Terminal, and Handling Fresh Foods as well

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About the Yamato Group

The Yamato Group includes the following companies: Yamato Transport Co., Ltd., which has developed an express delivery network nationwide; Yamato System Development Co., Ltd., which develops and operates diverse IT solutions including data centers; Yamato Home Convenience Co., Ltd., which transports and sets up consumer electronics, household goods, and machinery that cannot be transported via express delivery; Yamato Logistics Co., Ltd., which specializes in domestic and overseas logistics outsourcing; Yamato Financial Co., Ltd., which provides settlement services; and others. These companies pool their talents, which encompass "information, logistics, and settlement", to provide optimal solutions from a comprehensive perspective to the problems of client companies.