Mainfreight USA - CASE STUDIES

Transborder Distribution Case Study - Servicing the Canada Market from an Existing US Distribution Center

• Issue Presented: US companies are opting to eliminate their warehouses or 3PL facilities in Canada. The purpose of this is to service their Canada based customers from their already existing US Distribution Centers and inventories. This allows shippers to support Canada as part of the entire North American network versus handling these areas with a second warehouse and set of inventory.

• Advantages: The savings build quickly:  By using one inventory and one team to pull and pack orders, this reduces interest expense on additional inventory, creates less risk of obsolete product, makes the inventory easier to manage,  and no duties (if applicable) are paid in Canada until goods are actually sold.  Also, shipments arrive to Canadian customer as if they were shipped from Canada, meaning that they are not involved in the customs clearance process. 

-How the Process Works: You, the shipper must first be established as an NRI (Non-Resident Importer) meaning that you assume the burden of customs clearance on sold goods moving to Canada.     

• Goods are “in transit” from the time they leave the US distribution center until delivered within Canada.

• Duties (if applicable) are built into the Canada selling price as these fees are non-recoverable. 
• GST (Goods & Services Tax) is calculated and added to the invoice when billing the Canadian customer.  This is the flat 5% portion of the HST (Harmonized Sales Tax), which is the combined GST and PST (Provincial Sales Tax)  that is paid across Canada.
• By adding the 5% to the billing invoice, shipper is able to receive the GST in their payment from the Canada based customers.
• At the time of arrival at the border to Canada, shipper is shown as the NRI for all shipments moving into Canada.
• Duties (if applicable) and GST taxes are assessed by Canada Customs and charged to the shipper. When handled properly, these fees are both protected for the shipper.
• Once cleared and arrived into Canada, goods are transferred and delivered throughout Canada without any involvement in the clearance process by the Canadian buyer. 

-Why This Will Make Your Business More Attractive to Clients:

• Canadian customers have easy solution for buying US origin merchandise.
• Customers are not involved in the customs formalities but still pay the fees associated.
• Shipper increases sales through easy portal for buys to use.

-Am I the Type of Business that Should Look into this Type of Shipping? Yes, if you are a:

• US Based store with numerous outlets within Canada
• US shippers wanting a solution to begin or increase E-Commerce business
• Supplier to large chains i.e.: Wal-Mart, Best Buy, Costco
• Shipper that requires residential deliveries throughout Canada.
• Shipper of medical devices, in home products, catalogue shippers, retailers, and many more.

For more information on Mainfreight’s transborder services, be sure to visit:http://mainfreightusa.us/services/domestic-freight/specialized-service

Or, contact our team:

Director of Canada Business Development:

Craig Meador | 310-761-1517 | craig.meador@mainfreightusa.com

VP of Sales & Marketing:

Tom Valentine | 518-573-8525 | tom.valentine@mainfreightusa.com

Money Saving Retail Case Study – SOP (Standard Operating Procedure) Development

• Issue Presented: A young retail company which began to experience exponential growth over the past couple of years, decided to refurbish as well as open several store locations. In 100% of these scenarios, this company was letting their vendors handle all of their freight forwarding. This was translating into two problems – the first being that this was placing all of the decision making power in the hands of the vendors. With the vendors overseeing this part of the process, the company had zero visibility of their cargo, and was unaware as to whether items for store openings were being delivered early, damaged, or possibly even not at all.  Next, being that there were so many parties involved in the procurement of items necessary for store openings, the company was being faced with high freight markups.

• Solution Suggested: Mainfreight felt that by designing a specialized SOP (standard operating process) for this client, they could help them to streamline and organize their store opening process, which would save them time, money, and the headache of making sure that all aspects involved in pulling off a store opening entail. The number one feature that the SOP improved for this client was firstly, communication; all scenarios and details were so specifically listed out that there was a procedure to follow for nearly every instance that may go along with the opening of a new store. Along with designing this custom SOP, Mainfreight suggested that one of their sales team members manage this process for the client, in order to make sure that all procedures stay up to date and that things are running according to plan.

• Final Results: By getting to know this retail client and their specific needs, Mainfreight was able to get to the root of their logistics problem and why they were spending so much money on shipping – yet still felt things were disorganized. Mainfreight worked very closely with the client in order to make sure that the SOP was mapped out exactly as they envisioned it. The account manager now acts as the liaison for this account and has very frequent communication with both the vendors and the contractors to make sure that everything is lined up to be delivered when and where it needs to be. This has also eliminated the possibility of freight (such as light fixtures) being delivered 2 weeks early and in turn getting damaged. This widely used ‘just-in-time’ logistics tactic has proved to be very effective for clients such as this.

Have a (logistics) problem and need a solution? Mainfreight would love to help. Contact our team today to find out more:

VP of Fashion & Retail Services:

Peter Burke – 714-745-4907 – peter.burke@mainfreightusa.com

VP of Sales & Marketing:

Tom Valentine – 518-573-8525 – tom.valentine@mainfreightusa.com

Clothing Manufacturer Case Study

• Issue Presented:  A New York based Women’s Wear manufacturer had a new product launch for one of their new designers. The product was one that was to be timed release to a major US retailer; all products had to be released on same day and time at over 600 store locations. The volume of this launch was in excess of 600,000 pounds. The apparel manufacturer’s supplier in Shanghai China also had production and quality control issues.

• Solution Suggested:  Mainfreight felt that the best option for the client would be to secure ocean and air freight space from Shanghai (SHA) to Los Angeles (LAX) port and airport, and then clear the goods through our in house Customs Brokerage Department. The shipment was brought into a manufacturer‘s 3PL warehouse in Chino, CA. Mainfreight then secured air and ground space to major retailer’s 14 US distribution centers. All shipments had to have EDI/ASN’s sent for appointment scheduling and the client was able to have constant visibility on all transportation through the use of Mainfreight’s client portal, Mainchain; from China and through to delivery.

• Final Results: Through assessing the specific needs of this client, Mainfreight was able to customize a specific plan of action to meet this manufacturing client’s needs. Each local MF branch office worked with local retail distribution centers to assure timely receipt to warehouse so product could make into local area stores to be in place for release. Mainfreight’s deliveries were 100% on time and all products were in place for the client’s Mid-November release date.

For more information on Mainfreight’s fashion/retail services, be sure to visit: http://mainfreightusa.us/services/transport-services/retail-shipping 

Or, Contact our VP of Fashion/Retail Services: 

Peter Burke | 714-745-4907 | peter.burke@mainfreightusa.com 

Small Pack Canada Distribution Case Study

• Issue Presented: Company A wanted to hear about USA/CANADA DISTRIBUTION solutions. Currently they were using UPS small pack and every shipment they moved took at least 15 minutes on the UPS website.  They had to fill out five different screens in the UPS system on each shipment as well as to make a separate commercial invoice for every shipment which incurred a separate clearance on every shipment.  On top of all that, the brokerage team at UPS Supply Chain in New Brunswick was very tough to deal with and the service was extremely deferred sometimes with two weeks transit. 
• Solution Suggested: We make Company A an NRI (Non-Resident Importer of Record) and save time and money on the shipping and clearance of the goods by doing one clearance and using one commercial invoice.  Then manage the distribution out of Toronto. We then went to them and explained that all they would need to do was fill out a spreadsheet with their shipment information, instead of a different house bill for every shipment.  Then we create a batch import in to our system and upload them all.   We showed them how they could also use the same spreadsheet to create a commercial invoice. 
• Final Results: What solving this problem ‘The Mainfreight Way’ did for Company A, was make them more efficient by taking over the majority of the shipping process and streamline their outgoing process.  It freed the operators up to move more freight with the extra time this created.  They have one clearance instead of 30-50 clearances which clearly saves them money, the transportation was also 10-15% cheaper, the broker we suggested is easier to deal with and the transit is never longer than a week.  Because of the success of our small pack, they have started to also give us the bigger shipments that they were giving to LTL carriers and are thinking of using us for Domestic again and possibly the Ocean Import. 

Military Sector Case Study

• Issue Presented: A US military division was in need of moving 110 crates, totaling 73,000 lbs., from the US to Afghanistan. This particular sector needed the crates delivered to the final destination within 5-7 days of the initial request, in order to execute a critical mission. Usually such a move is very possible, however, at the time there was a backlog into Afghanistan due to insurgent activity. Furthermore, the shipment was of very high visibility and required constant monitoring - all crates also required being delivered together.
• Solution Suggested: Mainfreight USA offers chartered aircraft services for very high profile and high visibility shipments, which is what we suggested for this particular customer’s scenario. With this special charter, we were able to route the customer’s freight around the problem area in Afghanistan. When the shipment arrived, Mainfreight trucks and armored guards were waiting, and then loaded the freight on to designated trucks.  The trucks were then able to deliver the freight directly to the customer and arrived by the fifth day. Mainfreight USA’s operations team worked around the clock to insure that both parties of this shipment were kept informed by telephone & email every step of the way.
• Final Results: By taking into account the customers extremely time specific needs, Mainfreight USA was able to develop a specialized plan to meet the detailed requirements of this shipment. The freight was delivered in-full and on time to a mission critical event. 

Packaging Company Case Study

• Issue Presented: Company B manufactures hard shell plastic overwrap cases for a variety of customers on the Eastern Seaboard. When importing, Company B would use one of two ocean transport methods.
  
  • The first option: ocean carrier to Baltimore, Maryland - while inexpensive, this option added 10-15 days to the transit time of the goods. Upon arrival in Maryland, the containers would be delivered to Company B’s handling agent for re-palletizing and delivery. The second option: using the ocean line’s mini land bridge option out of California – this option was more expensive, but did reduce the transit time by about 10 days. The problem with this more expensive and efficient option however, was that the inland rail portion of the delivery was causing a problem.
• Overall, the transportation pricing in conjunction with timing were not meeting either end of the business to business supply chain needs. Any delay in the shipping schedule was causing much angst with both the customer as well as the client.
• Solution :Mainfreight USA suggested that the product be shipped via ocean from Long Beach CA, where it would then be cleared, drayed, stripped and palletized in the Mainfreight Los Angeles, CA warehouse. From there, our operations department would facilitate economy ground delivery to the end user via Mainfreight’s trucking network.
• Final Results: By utilizing Mainfreight’s in-house Customs House Brokerage, local trucking and the break-bulk warehouse in Los Angeles, we were able to provide a reliable, timely and cost effective solution to a customer’s problem. The total door to door cost to the end user ended up falling with the range of the original and cheapest option that the Company B was utilizing, and also offered a defined delivery schedule to the customer’s client base.

Luxury Handbag Company Case Study 

• Issue Presented: It was becoming clear that the LHC supply chain was being compromised by transit time and visibility across the US/Mexico border.  LHC was using traditional airfreight service to Mexico. The freight forwarder and airline would require a stop in Mexico City for the goods to be unloaded, cleared through customs and transferred for delivery to the final destination. The use of an exclusive truck for transportation to the point of delivery was adding even further costs to the airfreight rate.
• Solution Suggested:  Mainfreight USA presented airfreight and ground options to LHC. Through discussion with the client, it was determined that LHC did not need to send their goods via Air, and through customs in Mexico City. Using Mainfreight Mexico Transborder service connecting the United States and Mexico, we were able to Meet LHC production and delivery requirements without time definite ground services.
• Final Results: By analyzing and understanding the LHC supply chain needs, Mainfreight was able to customize a specific ground routing solution. This new solution had a time definite accountability and opened up a window opportunity to begin customized tracking, give visibility on both sides of the border all while REDUCING TOTAL LANDED COST.