Inside Logistics

One giant leap

A retailer’s jump to import independence

December 18, 2009
by Deborah Aarts

In the era of outsourcing, why would a company ditch most of its Customs brokers and opt to manage its import program in-house? Giant Tiger found out. Deborah Aarts explains.

Accuracy means a good deal to a company like Giant Tiger. Every year, the discount retail chain imports thousands of containers. Given the complicated nature of dealing with multiple vendors located around the world, there’s plenty of room for error—and until recently, plenty of errors were made.

For the past two years, the company has been working to revamp its Customs compliance and other import activities. It’s done so partially by implementing new programs and technologies. But by far the biggest benefit came from discovering it could do things best on its own.

A national presence
Giant Tiger operates 193 stores across Canada.

To keep the shelves stocked, the company is constantly on the lookout for good-quality, low-cost merchandise. It relies heavily on opportunity buys—that is, one-time purchases from suppliers looking to offload surplus product. As a result, its pool of vendors is constantly changing.

Every year, the company imports roughly 500 trailerloads from the US and 1,000 40-ft containers from Asia. The marine shipments come into Canada through the Port of Prince Rupert, Port Metro Vancouver or the Port of Halifax.

Immediately after each imported shipment enters the country, it is transported to the company’s 500,000sqf distribution centre in Ottawa, Ontario. In the DC, inbound shipments are broken down and reorganized into deliveries for each individual store. From there, Giant Tiger’s dedicated fleet of 30 trucks and 80 trailers hauls the merchandise to stores in central and eastern Canada. Thanks to a partnership agreement, shipments to stores in western Canada are sent to the Winnipeg, Manitoba DC of fellow retailer The Northwest Company, which handles final delivery.

The centralized DC model works well, but import/export manager Roger Matchett says it is considering establishing a small deconsolidation facility in Vancouver. This would allow the company to break down shipments immediately and ship them directly to western stores.

“This program is something we’re considering, as the real benefit would be to the stores,” he says.

Trouble on the import front
Until 2006, when it came to imports there was little validation among what was purchased, what was received and what was paid—information that must be accurate in order to comply with Canadian Customs rules. Because the company depended almost entirely on its vendors and Customs brokers to provide the correct information to the authorities—“we did not have the manpower to do it,” Matchett explains—errors became common.