A clever concoction

“Because we are a small business, and because we often operate in case volumes instead of pallets, working with a 3PL did not give us enough flexibility to serve our customers in the way we wanted to,” she says.

So the company decided to reclaim control of its supply chain. The first step was finding a new warehouse. But the high cost of refrigerated storage space made it difficult for the company to justify the cost of occupying a facility of its own.

The solution, then, was to find some partners.

Come together

Through its connections in the food supply chain, Happy Planet found two companies willing to share space. The first, ColdStar Freight Systems, is a 3PL specializing in temperature-controlled food logistics that Happy Planet has long used for some of its BC deliveries. The second, Liberté Natural Foods Inc, is an organic foods manufacturer that Happy Planet supplies with product.

Today, the three companies share the warehouse space—which is split into freezer, refrigerated and dry (ambient) areas —and the costs associated with it. The lease governs who has control over what space, but the rules are not iron-clad; each company is comfortable asking the others for help on occasion. For instance, if an inbound delivery comes in on an off-shift, ColdStar might unload it if no one from Happy Planet can be there. Or if Liberté needs a little extra storage space, Happy Planet might lend some racking for a few weeks, perhaps in exchange for usage of Liberté’s high-reach forklift.

Such informality may seem risky, but Korva says the arrangement is anything but.

“We have very trusting relationships. In the two years we’ve been there, we have not had one case of product stolen,” she reports.

“I think the fact that we have business relationships strengthens the arrangement. Because Liberté is a customer and ColdStar is a carrier for us, we have common goals.”

Special deliveries

The warehouse gives Happy Planet enough flexibility to handle its unique flow of inbound and outbound deliveries.

Inbound traffic is made up almost entirely of raw ingredients. Some of it, like apple juice, comes from local producers. More tropical fare, like orange juice and banana puree, comes from vendors as far away as Costa Rica.

In the past, much of the juice and puree arrived in steel drums. These drums gave Happy Planet the necessary ability to order small volumes, but presented a number of problems. First, their cylindrical shape took up a lot of storage space—only four, at maximum, would fit on a pallet. Second, they were difficult to transport in a cost-effective way, especially when they were empty. Third, as the price of steel was rising, they were becoming much more expensive.