Summary
¦ Port centric logistics involves having a distribution centre at the port.
¦ WestBank Timber uses PD Ports’ service at Howden Port.
¦ It says it enables it to be more efficient and cost-effective.
¦ PD Ports also operates the Logical Link coastal service.

Two decades of relatively good profit margins, long shelf lives and an attitude of “let the logistics and transport costs take care of themselves”, have lulled many of the UK’s importers, wholesalers and retailers into economic comfort zones. However, the recent recession, a weakening pound and a more complex supply chain have forced them to rethink their freight-handling and transport strategies. This is where port centric logistics can help.

Port and logistics specialist PD Ports, which owns Howden Port, 50 miles inland on the Humber, and Teesport, the combined ports of Tees and Hartlepool, is a leading proponent of port centric logistics.

“In the past, when goods were imported, they would be taken straight from the port to one or two distribution centres many miles inland and redistributed from there,” said PD Ports development director Paul Barker. “Port centric logistics works on the principle that it is faster, more cost-effective and certainly more environmentally friendly to set up a distribution centre at the port(s) and distribute directly to the local region from there.”

WestBank Timber

Fencing importer/wholesaler WestBank Timber understands the importance of working closely with ports and other logistics suppliers.

Incorporated in 1995, the company was established in Ipswich but has opened further terminals in Newport, South Wales and Howden Port to give it easier access to customers throughout the UK. From the latter it supplies wholesalers and merchants throughout the north of England and Scotland.

With the port centric approach, WestBank Timber is in good company.

Four years ago PD Ports forged a partnership with retailer ASDA-Walmart at Teesport, the UK’s third largest port. A 360,000ft² import centre handles all the incoming products for the retailer’s northern stores network. The partnership has saved ASDA about two million lorry miles a year as well as significantly reducing its distribution and handling costs.

“By basing their distribution centre at Teesport, companies get the benefit of more cost-effective land and a readily-available labour force, rather than moving to the traditional locations in the Midlands, known as the Golden Triangle, where we know land and labour rates are high,” said Mr Barker.

Reducing expense

Another advantage of port centric logistics is that it eliminates the expense and effort of hauling the Sea Containers hundreds of miles across the UK and then returning them empty to the ports. It also eliminates the fuel and labour costs of double-handling – carrying goods from port to distribution centre and from distribution centre to end user.

Following ASDA-Walmart’s example, UK retailer Tesco opened a 1.2 million ft² import centre at Teesport, creating 800 jobs and making huge logistics cost savings.

PD Ports doesn’t just provide the land and help companies to establish warehouses, it has also set up a coastal service, the Logical Link, which brings containers from Felixstowe to Teesport by short-sea feeder ships three times a week. This service helped PD Ports win the Outstanding Carrier title at ASDA’s 2010 National Carrier of the Year awards.

“Of course, not all timber is imported in containers, but the benefits of port centric logistics apply equally to break bulk trades,” said Mr Barker. “We lease the terminal and the adjacent land and warehouses to WestBank and offer many more services.” A PD Ports team unloads the ships coming in from the Baltics and it acts as agent while the ship is in port.

Efficient and cost-effective

WestBank Timber managing director Brian Griffiths said the opening of the facility at Howden had been “very beneficial” and had helped it to serve its clients “more efficiently and cost-effectively”.

“We offer companies multiple ports of entry,” he added. These include an extensive warehousing and wet bond facility at the Port of Felixstowe and facilities at the Port of Immingham on the River Humber.

PD Ports says that the port centric logistics concept will work for a wide range of industries.

“Not only does port centric logistics enable cargo owners to gain control of both supply chain costs and the timing of the movement of their goods, it also opens up each element of internal logistics cost to scrutiny and improvement,“ said Mr Barker.