Your Pooling Solutions Partner

issue 10

New Plastic Pallets a Hitin Chinese Market

Your Pooling Solutions Partner

China Yonghui Surges Ahead with Loscam' s SupportThailand Ichitan Pioneering Automated Warehouse SolutionsFresh Produce Food Safety

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I wish you all a happy and prosperous new year, and personally extend my gratitude to our customers, suppliers and employees for their unwavering support during a particularly difficult 2012.

Challenges were prevalent throughout Asia, including Thailand’s devastating floods, Vietnam’s sluggish economy, and typhoons and subsequent log ban in the Philippines, among others. Despite the uncertainties, Loscam Asia finished the year with double-digit growth – a monumental achievement that made celebrations of our company’s 70th Anniversary more meaningful.

Demonstrating our commitment to the region, we continue to invest in infrastructure and network development in China, including the opening of new depots in major cities. Loscam now provides service coverage throughout China, facilitating better service and reach, and allowing us to expand our customer base, culminating in the milestone of having over 2 million pallets on hire. We also introduced a new plastic pallet to the Chinese market to serve more specialised needs.

2013 begins with significant increases in labour and raw materials costs in every country. Our goals are to focus R&D efforts on finding alternative materials and developing new products. We are also working closely with customers to boost efficiency and control costs for a leaner supply chain, as well as leveraging IT to manage transactional processes and increase access to real time data.

It is an exciting time for Loscam Asia. Our business continues to grow, despite the challenges. We will forge ahead, with the broader goal of becoming our customers’ true pooling solutions partner.

Thailand Tel (66) 3521 5549 Fax (66) 3521 5550

China Tel (8621) 6104 8156 Fax (8621) 6104 8162

Hong Kong Tel (852) 2419 2692 Fax (852) 2521 5205

Indonesia Tel (62) 21 883 72050 Fax (62) 21 883 72051

Malaysia Tel (603) 5511 7066 Fax (603) 5511 7062

Philippines Tel (632) 842 7878 Fax (632) 850 0905

Singapore Tel (65) 6863 0316 Fax (65) 6863 0312

Vietnam Tel (84) 650 3 769 199 Fax (84) 650 3 769 203

For general enquiries, contact Jamie Lo,tel +852 6292 1613, [email protected].

If you wish to receive the Loscam Across Asia magazine by email please contact [email protected]

22 Your Pooling Solutions Partner

MD

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kContents

From the MD 's desk

On the CoverChina Plastic Pallet 5Customer UpdateYonghui China 3Ichitan Thailand 4Special FeatureFresh Produce Food Safety 6 New Zealand update 7Loscam’s 70th Anniversary 7Celebration

Loscam NewsFrom the MD's desk 2Indo Semarang Depot 8Support Convoy For Kids in Thailand 8Tianjin Exhibition 8Loscam Asia Management 8Conference

Mr. Sirin Limpaitoon, Managing Director - Asia

Loscam Across Asia is printed on The ForestStewardship Council (FSC) certified paper

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Yonghui Surges Ahead with Loscam' s Support

Founded in 2001, Yonghui Supermarket Co., Ltd. was the first company to introduce fresh agricultural products into a modern supermarket setting in Mainland China. At the end of 2011, Yonghui boasted 325 large and medium-sized stores, covering a combined area of more than 3 million square metres. With an annual turnover of CNY 20.38 billion, Yonghui ranked in the top 20 among China’s 100 largest enterprises. Yonghui was listed on the Shanghai Stock Exchange in 2010 and by 2015, its annual turnover is expected to reach CNY 50 billion.


Lily Liu Loscam Sales Executive and Yu Jun Yonghui DC Manager

To support its business growth, Yonghui recently established large distribution centres (DCs) in Fuzhou, Hefei, Beijing, and Chongqing. With a combined total area of over 100,000 square metres, the DCs will serve Yonghui stores nationwide. To substantially reduce capital outlay and augment the company’s supply chain operations, including providing an effective solution to the empty pallets and capital occupation caused by seasonal fluctuation, Yonghui chose Loscam as its partner to handle its pooled pallet needs. In June 2012, the two firms signed a national contract to adopt the use of the ECR standard pallet in all of Yonghui’s DCs.

The Chongqing DC was the first to be put into operation in October 2012. Anticipating a surge in demand during the country’s National Day holiday, Loscam arranged pallets from local and nearby depots to meet Yonghui’s urgent needs, ensuring seamless operations without any delay.

As the growth of modern format supermarkets continues on an upward trend with ever-increasing sales volume, Yonghui’s DCs will face greater challenges related to distribution efficiency and operation costs. To enhance supply chain links and support business growth well into the future, Loscam will work with Yonghui to find ways to reduce the average cost of pallets in each DC, and further promote pallet pooling amongst Yonghui and its suppliers. This will, in turn, greatly reduce labour costs and expenses related to product damage, save manpower resources, and improve logistics operation efficiency and safety.

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Pioneering AutomatedWarehousing Solutions

A team from Loscam, including Sirin Limpaitoon, Managing Director – Asia, recently visited the factory and new automated warehouse of Ichitan, a leading producer of bottled green tea beverages in Thailand. Located on 30 acres in the Rojana Industrial Park in Ayutthaya province, Ichitan is truly an industry leader. It is the first Thai F&B firm to employ fully automated warehousing solutions, as well as one of the first Thai companies in Rojana to bounce back from the Thai flood crisis in late 2011.

Ichitan’s CEO (and its celebrated brand ambassador) Tan Passakornnatee explains, “Ichitan has been operating for over two years. Shortly after we began production, the flood shut us down for two months. It took an additional four months to make repairs. Today we produce 600 million bottles each month - three times the volume since the flood.”

Against a backdrop of packed floor-to-ceiling shelves (with Loscam’s striking yellow pallets), stacker cranes, and pallet conveyors, Mr. Passakornnatee explains that the decision to invest over 200 million baht in the automated warehouse was backed by a desire to maintain consistency in product quality and promote safety. He says, “I never considered IRR or NPV. Safety was my main motivation; without people in the warehouse, we drastically cut down on errors and serious accidents. And now, we have the added benefit of a shelter from the mandatory wage increase.”

The facility employs about 100 staff, including R&D and quality assurance specialists. Half of the 100,000 square metre warehouse is currently in use. “With Loscam’s help, we are handling 30,000 pallets; each pallet holds 60 cases,” says Mr. Passakornnatee. “Next year, we will build a second factory on the premises, and double capacity.”

Ichitan’s products are mostly sold in Thailand through modern and traditional trade channels. Mr. Passakornnatee comments, “Thailand’s infrastructure has room to further improve. The physical reach of many products is limited. The government should give more support and investment to logistics, including transport infrastructure and high tech automated processes.”

“If the cost of transporting goods is too high, the country cannot compete with its neighbours, especially in the wake of the ASEAN integration. It is important to have a cost-effective

system to re-circulate containers or packaging at the last point of use similar to Loscam pallet pooling system.”

Mr. Passakornnatee plans to take Ichitan public in late 2013. And Loscam is poised to grow alongside this dynamic firm as it expands production capacity, increases product offerings, and penetrates new markets both within and outside Thai borders.

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L to R : Peter Hubbard Loscam Thailand Country Manager, Phattharada Kraikhum Loscam Thailand Customer Service Manager, Tan Passakornnatee Ichitan CEO, Sirin Limpaitoon Loscam Asia Managing Director and Somsak Nattakrannuwat Loscam Thailand Sales & CRM Director

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In August 2012, Loscam introduced its innovative plastic pallets to the Chinese market. Featuring excellent quality

and customer-oriented designs that are well suited for a variety of uses, the pallets have had strong

customer reviews.


Loscam’s PP unique embedded anti-skid function protects products better.

Leo Hu Loscam China Senior Sales Executive and Jacky Xu DHL Logistics Manager

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In Mainland China, Loscam is the largest pallet leasing operator with a dominant market share in returnable wooden pallet hire. When some of the company’s customers began to request plastic pallets, Loscam worked on developing a suitable alternative. Mr. Zhengnan Dai, GM of China Merchants Loscam (Greater China), explains, “Loscam always strives to be the leading solution provider for pooling through developing customer-driven and market-needed products. Our plastic pallet will expand our service offering to customers who require a more hygienic pallet for specific uses.”

Loscam’s new plastic pallet conforms to the national pallet standard and ECR specifications, with measurements of 1200mm in length, 1000mm in width, and 173mm in height. Compared to their counterparts in the market, Loscam’s new product stands out. Mr. Dai says, “Our plastic pallet has been thoughtfully designed with many unique and innovative touches, such as having flat surfaces for easy cleaning; anti-slip strips embedded in both the surface and bottom for greater safety while in use; and a four-way entry capability, enabling easy handling with various pieces of equipment and allowing multi-applicability in racking, floor storage and ASRS.”

Loscam’s existing customers are the new plastic pallet’s best marketing tools. Mr. Jacky Xu, a DHL Logistics Manager responsible for one world famous chocolate brand, says, “DHL has long been using Loscam’s wooden ECR pallets, with great satisfaction. But for companies with specific needs, such as our confectionary client, we are so happy that Loscam has rolled out this great new pallet. Its innovative design and improved functionality over the plastic pallets previously available in the market allows us to better fulfil our operation requirements, especially in terms of maintaining immaculate hygiene around the goods and protecting delicate products with anti-skid functions.”

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Is Asia' s Food CultureUnder Threat fromPoor Supply Chains?

Recent scandals in food safetyhighlight the need for improved

oversight of produce supply chains.

As governments are clearly responding

to community demands for greater food standards,

new opportunities for operators within the food and associated supply

chain sectors.

The transportation sector has increased its use of vehicle and temperature monitoring systems to ensure

the cold chain is not broken during transport. “In general, food, even if properly cleaned and packaged, may have some minor trace of bacteria. The trick is that it doesn’t grow, and high temperatures cause that problem,” said Kevin Payne, senior director of marketing for Intelleflex.*

Opportunities also exist for improving the equipment used to store and transport fresh food. The use of standardised and hygienically cleaned returnable plastic crates (RPC’s) ensures fresh produce is kept safe during transit, when handled through markets and wholesalers and finally at the retailer shop floor.

Loscam is seeing increased demand for its produce solutions across Asia Pacific as retailers and food producers look to

optimise both logistics and food safety. It is no secret that retailers achieve higher margins from their produce offering, providing the motivation to ensure fresh food is merchandised with minimal handling and in optimum condition.

With the ultimate objective of a “one-touch” system where produce is picked, transported and displayed in a single RPC, we are seeing the use of RPC’s and bins emerging in-store and from pack-house to store, lifting standards where they are most immediately manageable.

“Once we are able to educate as to the benefits of the use of bins and RPC’s in store, we will then push their use back down the supply chain so that we can achieve real benefits in food quality and improved handling” says Peter Hubbard, Loscam’s GM Thailand. “We have kicked off our RPC business in Thailand and hope to bring the benefits of the RPC’s and bins to our customer base here and across Asia” says Peter.

Thailand’s Prime Minister Yingluck Shinawatra, recently cited food safety as Thailand’s top priority. The Vietnamese Government has recently increased penalties for food safety violations. Malaysia’s Deputy Health Minister, Datuk Shirlin, told a recent conference that more effective mechanisms have been put in place at every level of the food supply chain to ensure safety. In January, the Shanghai Government announced a scheme to reward food safety whistleblowers who report food safety violations.


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Returnable Bins Used to Merchandise Larger Fruit

*Ref : http//freshcut.com.Intelleflex, supplies data monitors to food companies to monitor in-transit temperatures.

Pre-Pack Vendors Pack into RPC’s

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Loscam’s recently appointed National Business Manager – New Zealand, Nick Trask, has been overwhelmed at the level of interest from pallet users across the country, as they have not had a choice of provider in many years.

“Our customer list is growing by the week as companies are realising not only does Loscam provide a clear choice in the market, and our 4-way entry pallet provides a clear point of differentiation in the market” says Nick.

Based on Loscam’s Asian ECR pallet, the New Zealand pallet enables easier handling at back of store and on loading and unloading vehicles as a mix of rear and side unload vehicles are used in NZ. The Loscam pallet is also safer as the perimeter bottom boards don’t allow the pallet to tip when being handled by forklifts (the current competing pallet is prone to tipping when handled on the 1m face).

Loscam 70th

Anniversary Celebration

Loscam was founded in 1942 and marked its 70 years of business last year. On the occasion of 70th anniversary, we presented a pallet crystal trophy to our valuable customers. Besides celebrating the 70th anniversary, this trophy is also a token of thanks to our customers for their continuous support and loyalty. We treasure the close relationship with our customers and strive to be your Pooling Solutions Partner.

One year on, and now with over 50 customers, the Loscam New Zealand business continues to grow and offer choice to the New Zealand market.

PT Tirta Investama ( AQUA ) Indonesia Carlsberg Malaysia LF Logistics Thailand DHL Thailand

Makro Thailand HomePro Thailand Nestle Thailand Tesco Thailand Red Bull Thailand

ThaiBev Thailand Unilever Thailand FrieslandCampina Vietnam Metro Vietnam Number One / THP Vietnam


Loscam New Zealand Continues Expansion

Linda Tsui Loscam CFO and Mark Daniel Loscam CEO at Foodstuffs PaknSave, Manakau Store

The first Quarter Management Conference for Loscam Asia was held in Hanoi Vietnam in Jan 2013.

Loscam Asia Management Conference

The Semarang Service Center opened on April 2011 in Bawen to serve a range of customers in central Java, Indonesia. On January 2013 the depot moved to Candi area in order to better serve the growing customers base.

The new depot is located at Awasan Industri Candi, Blok H, No. 9 Semarang -Jawa TengahCandi. Candi is in the major industrial area in Semarang.

Semarang Depot Moves to Candi

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Loscam participated in the 14th China Chain Store Expo, one of the largest exhibitions in China’s Retail Industry. Loscam showcased the latest innovative Retail Ready solutions and introduced the benefits of pooling solutions.

Retail Ready in China Tianjin

Loscam was a Silver sponsor for the CFK Charity golf day held in June 2012. Loscam donated over 90,000 THB to assist with cost of taking the underprivileged children on an away-day. A total 300 children involved in the charity went to Bang Saen Institute of Marine Science and then on to Bang Saen beach.

Loscam Thailand to Support Convoy For Kids

Ganokon as representative of LOSCAM to assist with cost of taking the children on away-day

Pak Yoga (centre) and his team

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