MING CHUAN UNIVERSITY - INTERNATIONAL COLLEGE

INTERNATIONAL BUSINESS AND TRADE DEPARTMENT

Supply Chain Management Final Report

APL LOGISTICS - 3PL LEARNING REPORT

Professor 18th December, 2024

Maria Tu

Members
Phung Phuoc Vinh Bruce 10914061 [email protected]
Trinh Hai Tung Tonie 10914052 [email protected]
Dang Cong Son Kristan 10914114 [email protected]
Dao Tong My Linh Tamilyn 10914141 [email protected]
 TABLE OF CONTENT

Introduction 3
Chapter 1: Overview of APL Logistics 5
Chapter 2: History and Development 6
Chapter 3: Network and Services 9
Chapter 4: Challenges and Solutions 10
Chapter 5: Benchmarking 22
5.1. Service 23
5.2. Delivery 23
5.3 Quality 24
5.4. Cost 24
5.5. Risk Management 24
Conclusion 25
Recommendations 25
REFERENCES 27

1
 Introduction

APL Logistics is a top 50 global third-party logistics provider (3PL). KWE plans to
leverage APL's strong presence in Asia, its expertise in specific industry verticals like
automotive. It is a global logistics provider with a strong presence in the Asia-Pacific
region.

APL Logistics derives significant revenues from five main customer industry groups:
Automotive and Industrial Manufacturing, Apparel/Fashion, Retail, Food and
Consumer Goods, and Electronics/Hi-Tech. Key customers include: ASICS, Avon,
Colgate-Palmolive, Dow Corning, Electro-Motive Diesel, Emerson, Netgear and Stein
Mart. 60% of APL Logistics’ revenues are from its warehousing, land transportation
and automotive logistics services and the rest are primarily from its international
logistics services which includes origin services, ocean consolidation, destination
deconsolidation and transloading, and air and ocean freight forwarding operations.

This report offers an in-depth analysis of APL Logistics as a 3PL company, focusing
on its main characteristics, the challenges it faces, and how it stands competitively
within the industry.

The chapters in this report are designed to provide a clear and systematic analysis of
APL Logistics' operations and strategies as a 3PL company, rewrite and adhere to the
presentation content. Especially in chapter 05, we will present everything required but
still missing from the requirements of Professor Maria. The report is presented as:

Chapter 1: Overview of APL Logistics This chapter provides an introduction to the

company, outlining its mission, vision, and core strengths as a 3PL provider. It lays the
groundwork for understanding APL Logistics’ role and unique value in the global
supply chain industry.

Chapter 2: History and Development This section examines the company’s history,
tracing its origins, key milestones, and growth over time. It highlights how APL
Logistics has evolved and adapted to shifts in the market.

Chapter 3: Network and Services This chapter explores APL Logistics’ broad
network and diverse service offerings. By referring to supporting research, it analyzes
how the company uses its infrastructure and resources to deliver seamless end-to-end
supply chain solutions.

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Chapter 4: Challenges and Solutions This section dives into the internal and external
challenges APL Logistics faces, including issues like operational inefficiencies,
competitive pressures, and the impact of technological disruptions. It also discusses
the strategies the company employs to overcome these obstacles and maintain its
leadership position. We, then, propose some case studies for the company, highlighting
its 2024 projects and further interesting news they can get from them recently.

Chapter 5: Benchmarking This final chapter evaluates APL Logistics’ performance

against key industry benchmarks for 3PL providers. It includes a detailed comparison
with competitors of similar scale, examining both strengths and areas for
improvement. For this part, we would like to use our best efforts to analyze how much
APL Logistics stands alone as the 3PL company, as well to see whether the changes in
recent policies can make it better off in terms of operation.

By presenting a structured and comprehensive analysis of APL Logistics, this report

aims to provide meaningful insights into the company’s operations and contributions
to the logistics sector. Each chapter builds upon the last, delivering a complete picture
of APL Logistics.

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 Chapter 1: Overview of APL Logistics

“APL Logistics seeks to be a premier, profitable provider of global supply-chain

services to help enable sustainable trade and commerce in key markets and regions.”

This is the mission statement APL Logistics proudly claims for itself.

At the first time of research,they found it boring, but were struck by the phrase
sustainable trade. How could a seemingly logistics company achieve something so
profound? As delving into the company’s origins and milestones,they were astonished
by era-defining changes it had undergone. Not so much of a big word to
exaggerate,they really mean it.

The acquisition of APL Logistics by KWE (Kintetsu World Express) in 2016 brought
significant benefits to the company, including the expansion of its global network and
enhanced logistics service capabilities. APL Logistics has a vast network with
facilities spread across many countries, which helped KWE reinforce its presence,
especially in the Asia-Pacific region and the U.S. This acquisition also allowed KWE
to improve the quality of its logistics services, including freight transportation, supply
chain management, and warehousing services, thanks to APL Logistics' extensive
experience in these areas.

According to KWE Annual Reports (2016-2018), APL Logistics contributed to the

overall revenue growth of KWE, with KWE's total revenue increasing from
approximately $1.3 billion in 2016 to around $1.5 billion in 2017, partly due to
contributions from APL Logistics. The integration of APL Logistics' systems and
processes into KWE's operations not only optimized workflows but also minimized
costs. All of these benefits contributed to improving KWE's operational efficiency and
strengthening the company's position in the global logistics market.

On the other hand, it is a bit sad about how a used-to-be giant is now transferred to be
under the management of its followers. Let’s look more detailed into the change that
our presentation cannot fully present.

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 Chapter 2: History and Development

The story of APL Logistics is an inspiring journey in the world of global logistics.
Since its early days in 1980 with American Consolidation Services (ACS), the
company has been constantly striving to grow and adapt to market fluctuations. In the
context of an increasingly evolving global economy, the need for supply chain
management and logistics services is more urgent than ever. ACS has quickly become
one of the familiar names in the industry, shaping the future of many businesses. This
journey not only reflects the growth of a company, but also demonstrates the power of
innovation and strategy in the logistics industry.

The story of APL Logistics began in 1980 with the birth of American Consolidation
Services (ACS), a company specializing in managing the flow of goods from Asia.
After more than a decade of operation and continuous expansion, ACS has become a
familiar name in the logistics industry. In 1996, the company was officially licensed to
operate and distribute in the Chinese market, marking an important step forward in the
process of expanding its territory.

A major turning point occurred in 1997 when Singapore's Neptune Orient Lines Ltd.
(NOL) decided to acquire ACS. This merger has created a strong logistics group with
outstanding scale and competitiveness. To optimize operations, NOL underwent a
restructuring in 2000, consolidating its logistics services into a single entity called
APL Logistics and allowing the company to operate independently.

After restructuring, APL Logistics quickly expanded its operations globally. The
company has made many important acquisitions, such as GATX Logistics in Europe in
2001, Carmichael International Services in 2012, and constantly expanding its office
network in key markets. In parallel with geographical expansion, APL Logistics also
focuses on investing in technology and improving service quality. The company has
partnered with leading technology partners to develop cutting-edge supply chain
management solutions, while constantly improving workflows to ensure goods are
delivered to customers quickly and safely.

After nearly two decades of continuous development, APL Logistics has become one
of the world's leading logistics companies. However, in 2015, NOL decided to sell
APL Logistics to Kintetsu World Express, Inc. (KWE) for $1.2 billion. This decision
closes an impressive chapter in the development of APL Logistics and opens a new
phase under the management of KWE.
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Accordingly, the important stages of APL Logistics can be summarized in the chart
below:

Figure 1: Brief timeline of APL Logistics

Source: Self-compose

The COVID-19 pandemic has significantly impacted the logistics industry, including
major players like APL and APL Logistics. Both companies faced challenges such as
disrupted supply chains, reduced demand for international transportation, and
operational adjustments to comply with health regulations. However, they have also
adapted to the new market conditions, leading to different outcomes in their business
operations.

APL (American President APL Logistics

Lines)

Ownership CMA CGM (after acquisition Kintetsu World Express (KWE)

from NOL)

Core Business Container shipping Integrated logistics & supply

chain management

Operational Focus on international ocean Diverse transportation modes

Scope freight and logistics services

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Main Services - Ocean container shipping - Warehouse & distribution
- Terminal services management
- Bulk cargo transportation - Multimodal transportation
- Supply chain consulting
- Logistics technology solutions

Target - Import/export companies - Manufacturers

Customers - Freight forwarders - Retailers
- Container shipping clients - Businesses needing
comprehensive logistics
solutions

Development - Expanding shipping routes - Technology solution

Strategy - Investment in container fleet development
- Operational cost optimization - Logistics network expansion
- Supply chain optimization
Table 1: Differences between APL and APL Logistics
Source: Self-compose

APL Logistics has demonstrated remarkable resilience by enhancing its supply chain
processes and investing in digital transformation. The company has focused on
automation and real-time data integration, which has improved operational efficiency
and customer service. Additionally, APL Logistics has adopted a customer-centric
approach, positioning itself as a flexible supply chain partner. This adaptability has
allowed the company to better navigate the post-pandemic landscape and maintain a
competitive edge.

On the other hand, APL has also made strides in adjusting its operations but faced
more significant challenges due to its traditional asset-heavy model. While it has
historically maintained a robust operational framework, the pandemic highlighted the
need for a shift towards more agile and technology-driven practices. APL's efforts to
embrace digital solutions have been slower compared to APL Logistics, which may
hinder its ability to respond effectively to future disruptions.

In conclusion, while both APL and APL Logistics have faced challenges due to
COVID-19, APL Logistics appears to be better positioned for success in the
post-pandemic environment. Its proactive approach to enhancing supply chain
resilience, investing in technology, and adopting a customer-focused strategy has
resulted in improved operational performance. In contrast, APL must accelerate its
transformation efforts to remain competitive in an increasingly dynamic logistics
landscape.
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 Chapter 3: Network and Services

APL Logistics provides a comprehensive range of shipping services designed to meet

the diverse needs of global trade. With over 120 weekly services to more than 70
countries, it ensures extensive international connectivity. The company integrates
advanced technology into its multimodal transportation solutions, combining sea, air,
rail, and road logistics for seamless operations.

Figure 2: APL Logistics Network

Source: APL Logistics

Key international routes include direct connections from Vietnam to major markets.
For example, the Cai Mep – U.S. East/West Coast Route offers direct shipping to ports
like Los Angeles and Oakland, catering to exports such as electronics, textiles, and
footwear. The Middle East Route (WAX) links Ho Chi Minh City to major ports like
Jebel Ali and Sohar, supporting the transport of consumer goods and industrial
materials. The Red Sea Route (RSX) plays a vital role in trade with Africa, the Middle
East, and South Asia, while the Vung Tau – Vancouver – Prince Rupert Route
strengthens trade between Vietnam and Canada.

APL also specializes in logistics solutions for specific needs. Supply chain design and
engineering involves tailored solutions to streamline and optimize supply chains,
ensuring cost-effectiveness and efficiency, such as designing a multi-modal
transportation network to reduce delivery times. Shipment consolidation and
deconsolidation combine smaller shipments into larger ones for cost savings or break

8
down large shipments into smaller, more manageable units; for instance, consolidating
goods from multiple suppliers for a single retailer. Global freight forwarding and
customs management handles international shipments, navigating complex customs
regulations and documentation to ensure smooth delivery across borders with minimal
delays. Regional warehousing and distribution networks management operates
strategically located warehouses to facilitate efficient storage and distribution, such as
establishing a regional hub to serve multiple markets within a geographic area.

In addition, APL provides end-to-end logistics services, including transportation,

warehousing, packaging, and customs clearance, offering tailored solutions to meet its
clients' unique demands. Through these services, APL continues to support global
trade with efficiency, reliability, and sustainability.

Chapter 4: Challenges and Solutions

On January 31 2019, a fire broke out on the APL Vancouver container ship while it
was sailing off the coast of Vietnam. The fire started in a cargo hold at the front of the
ship, away from the crew's living quarters. The crew and salvage teams were able to
contain and extinguish the fire. Some of the cargo on board was damaged by the fire.

An extra tugboat is accompanying the ship to ensure its safe journey. All parties
involved in the shipment of the cargo will share the costs of the incident through a
process called "general average.”

From the unexpected issue about the voyage incident, the company was facing with
the fired voyage incident, therefore, the company looked back to their challenges, and
solved it by some feasible solutions. First are some internal and external challenges.

1. Internal Factors

Outdated technological infrastructure: APL Logistics has faced challenges in

integrating modern systems with legacy technology platforms, making it difficult to
optimize processes and improve operational efficiency. This issue not only reduces
productivity but also impacts customer service capabilities.

Complex data management: The growing volume of data from various channels
presents challenges in managing and utilizing data effectively. APL needs to develop
its data analysis and processing capabilities to deliver timely and accurate information
to customers.

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 2. External Factors

Intense competition: The logistics industry is witnessing fierce competition from major
players, including those with more advanced technological platforms. This puts
significant pressure on APL to maintain market share and enhance its services.

Global market volatility: Factors such as the COVID-19 pandemic have disrupted
global supply chains, leading to uncertainty in demand forecasting and inventory
management. APL must quickly adapt to these changes to stay resilient.

And then,they deploy the solutions categorizing these three followings:

1. Investment in Technology

Digital transformation: APL has embarked on a robust digital transformation journey,

including modernizing technology platforms to improve order management and
optimize operational processes. They have also developed a "data lake" to integrate
and analyze data from multiple sources, enhancing decision-making capabilities.

2. Strengthening Partnerships

Collaboration with strategic partners: APL has established strong relationships with
other logistics service providers, helping them optimize supply chains and improve
customer service capabilities. This not only reduces costs but also increases
operational flexibility.

3. Developing Customized Solutions

Diverse logistics solutions: Instead of applying a "one-size-fits-all" approach, APL

focuses on creating customized solutions for individual customers, particularly in the
automotive sector, where needs are highly diverse and complex.

To illustrate how APL Logistics has successfully addressed these challenges and
implemented innovative solutions, let’s delve into a specific case study. This case
study will highlight how the company has leveraged technology, strengthened
partnerships, and developed customized solutions to overcome obstacles and achieve
significant improvements in its operations.

Labor Management

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APL Logistics' distribution center in Minooka, IL, faced challenges in maintaining
consistency between established labor standards and actual performance. To address
this, the company partnered with Alpine Supply Chain Solutions to assess and
optimize labor standards. The initial step involved analyzing actual performance
against set targets, followed by evaluating each job function based on specific
performance metrics. Time studies were also conducted to validate existing standards.
The evaluation encompassed nine job codes, analyzing factors such as job content,
fatigue levels, delay times, and system interactions. As a result of these efforts, new
labor standards were established for the nine job codes, contributing to improved
individual accountability, the development of incentive programs, and enhanced
overall warehouse performance.

Case study: APL Logistics and global supply chains monitoring. (2012 case)

Sustainable Development as Core Business Value

APL Logistics considers sustainability a core value in all business operations. The
company has achieved significant results, such as reducing CO2 emissions per
container per kilometer by 47.4% in 2018 compared to 2009. Emissions reduction
measures include using shore power for vessels at ports on the US West Coast and
Yantian, along with transporting containers of equipment to clean up plastic pollution.
Additionally, the company developed a comprehensive emissions inventory report for
Scopes 1, 2, and 3, with 2022 as the baseline year. Scope 3 emissions account for 86%
of total emissions, primarily from purchased transportation and IT products.

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 Emissions Baselines

With the help of an Environmental Defense Fund

Climate Commitments Fellow and NSF
Sustainability Consulting services, APLL developed
Scope 1. 2. and 3 inventories using 2022 emissions
data as a baseline.

Scope 3 emissions, primarily from purchased

transportation, constitute 86% of the company's
carbon footprint. Pure rail transportation accounts for
the majority of these emissions, followed by ocean
and intermodal movements.

Purchased goods and services, particularly IT-related

activities, are the next largest contributor. Sustainability Report
Source: APLL

Energy Consumption per Square Foot by Region

Source: APLL Sustainability Report

North America, Southeast Asia, and South Asia are the largest contributors to direct
emissions, particularly due to warehousing operations and reliance on non-renewable
energy, warehouses in these regions account for 84% of direct emissions. South Asia
has the highest emissions intensity, while Latin America is seen as the region with the
greatest potential for energy efficiency improvements. To address this, the company
has invested in environmentally friendly vehicles, implemented green warehousing
practices, and promoted the construction of LEED-certified buildings. Waste reduction
initiatives include waste stream audits and wood recycling in Shepherdsville,
Kentucky, through donations to Habitat for Humanity.

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Up until now, APL Logistics has invested in eco-friendly transportation solutions,
including: electric vehicles and hybrid trucks, to reduce carbon emissions.

The company has also implemented green warehousing practices, such as

energy-efficient lighting, waste reduction, and recycling programs, to minimize its
environmental footprint.

Energy Analysis

APL Logistics' data indicates that Southeast Asia

(SEA) and North America (NAM) consume the most
energy due to the high concentration of warehouses
in these regions.

Latin America (LTAM) offers the greatest potential

for energy efficiency improvements.
Energy Consumption per Square Foot
Key factors influencing energy consumption include: by Region
Source: APLL Sustainability Report
• NAM's shift towards energy-efficient buildings and
higher concentration of offices. These calculations help to
• EMEA's focus on office spaces, resulting in lower understand where
energy consumption per square foot. opportunities may exist to
• Global policies promoting LEED-certified reduce APLL' s Scope 2
buildings, space-efficient offices, and emissions, which can be
more under control.
energy-efficient equipment.

Waste Reduction
The process of waste diversion and overall reduction contributes to decreasing
greenhouse gas (GHG) emissions in three main ways: avoiding the inefficient
breakdown of materials in landfills, reducing emissions from waste hauler
transportation, and reducing consumption at the front end, meaning fewer resources
and emissions are needed for product manufacturing. A key step in this process is
auditing our waste streams to understand their composition, which helps identify
source reduction and diversion management strategies. Additionally,theyengage in
practical initiatives such as donating wood used for blocking and bracing trailers at our
location in Shepherdsville, Kentucky, to a local Habitat for Humanity chapter, where
this wood is utilized in home-building efforts or sold in their workshops to support
charitable activities.

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Data Transformation

The challenges they face include the need to provide end-to-end visibility by
effectively connecting the dots across multiple ecosystem partners, which is crucial for
seamless operations. Additionally, the pandemic has caused significant congestion in
supply chain operations, further complicating our efforts. They are also experiencing
increasing demand from new customers, which adds pressure to our existing
processes. Compounding these issues, the traditional approach to managing these
challenges has involved intricate and time-consuming tasks, such as writing APIs
(Application Programming Interfaces) and establishing orchestration and monitoring
systems from the ground up, making it difficult to adapt swiftly to changing
circumstances.

To address the aforementioned challenges, APL Logistics has recognized the

importance of data transformation. Modernizing the data integration process not only
helps improve operational efficiency but also establishes a solid foundation for the
application of new technologies, such as artificial intelligence and big data analytics,
to optimize the supply chain

Integrated Approach with Axway’s Amplify Platform: By leveraging Axway’s Amplify

Platform, APL can create a cohesive and integrated approach to its data management
by utilizing a diverse range of APIs. This comprehensive integration offers several
advantages:

- API Ecosystem Development: APL can develop a robust ecosystem of APIs that
facilitate seamless data exchange between various stakeholders. This helps in
standardizing data formats, improving data accuracy, and ensuring that all partners
can easily access necessary information, which in turn streamlines operations and
enhances decision-making.
- Real-Time Data Access: Through the Amplify Platform, APL can enable real-time
access to critical data across the supply chain. This means that all parties
involved—including suppliers, logistics providers, and customers—can retrieve and
share information promptly, leading to improved responsiveness to market demands
and operational challenges.

Facilitating Smooth Transition with Existing EDI Partnership: APL's established

partnership with Axway around Electronic Data Interchange (EDI) serves as a solid

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 foundation for facilitating smoother transitions to more modern systems. Key aspects
include:

- Leveraging Existing Infrastructure: By building upon existing EDI frameworks,

APL can minimize the complexities often associated with transitioning to new
systems. This results in reduced downtime and lower operational risk during the
integration process.
- Gradual Migration Path: The partnership allows for a phased approach to
transitioning away from legacy systems, which means APL can implement modern
solutions without overwhelming their workforce or disrupting current processes.
This gradual migration enables staff to adapt more easily to new technologies.

Centralized API Management: APL uses Axway's Amplify Platform to discover,

secure, and manage APIs effectively. This centralized approach offers benefits such as:

- Improved Governance and Security: By managing all APIs from a single platform,
APL can enforce consistent security protocols, monitor API usage, and ensure
compliance across applications. This reduces the risk of data breaches and enhances
the integrity of the supply chain.
- Efficiency in Operations: Centralized management simplifies the monitoring of
integrations and allows for quicker troubleshooting of any issues, ultimately leading
to more efficient operations and reduced resource expenditures on IT maintenance.

Modernizing Legacy Systems Without Disruption: The integration of Axway’s Amplify

Platform allows APL Logistics to modernize its legacy systems incrementally while
minimizing disruption to current operations. This process includes:

- Adopting Modern API Capabilities: APL can introduce modern API functionalities
such as microservices architecture, which offers greater flexibility and scalability
compared to traditional monolithic systems. This modern architecture supports faster
development cycles and easier integration with new technologies.
- Gradual Feature Rollout: By implementing new features gradually, APL can gather
user feedback and make adjustments before full deployment, ensuring that the
systems work effectively for all stakeholders involved. This approach reduces risk
and increases adoption rates among users.

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This approach enables faster integration with customer systems, improving the
customer experience and reducing time to market for new services.

Besides, to support its contract logistics operations, APL Logistics utilizes a suite of
warehouse management systems (WMS) including Manhattan Associates
“WMi/PkMS,” Dematic/HK Systems “HKwm,” and its proprietary “WMSp.”

Each WMS integrates with clients’ enterprise resource planning (ERP) systems as well
as with the company’s suite of transportation management systems: “OTM” Oracle
Transportation Manager, “TM400” and “LoadTech.” APL Logistics’ technology
solutions include systems for labor management, yard management, shipment
optimization, and supply chain visibility to facilitate full order-to-delivery supply
chain optimization and tracking. Integration with clients’ SAP ERP systems is a core
competency. Most of APL Logistics’ warehousing operations utilize radio frequency
(RF) devices integrated with the warehouse management system(s) for paperless put
away, picking and overall inventory management. RFID, voice data collection,
integrated parcel manifesting and automated material handling solutions are also
deployed when needed. In addition to APL Logistics’ suite of logistics management
applications, it has also deployed an “Executive Dashboard” which provides its
management team with a comprehensive view of business metrics including: financial,
operational, safety, service, and other key metrics necessary to properly manage its
operations.

Strategic Location
China

APL Logistics has identified China as an element in Asia expansion strategy. It is a

gateway to other major markets in the region, including Southeast Asia, Japan, and
South Korea

Additionally, the company's established partnerships with local entities and

accumulated experience operating in China. Mainland China will likely remain the key
engine of global growth despite near-term softness. The focus of this location would
be on Order Management, which refers to the end-to-end management of product
movement, with an emphasis on planning and decision-making

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 China Warehouse Locations & Key Services

Source: Armstrong and Associated. Inc

A Leading Logistics Provider in China for a Major Computer Manufacturer

APL Logistics has supported the customer's Huiyang manufacturing plant, Huizhou,
China by fulfilling orders and distributing products both domestically and
internationally.

In 2006, APL Logistics moved to a larger, 124,000 square foot warehouse near the
production facility. This facility serves as one of the customer's Chinese production
distribution centers (PDCs) and operates using Lean/Six Sigma processes.

Product in four-high racking

The Production Distribution centers (PDC)
has 5 outbound and 3 inbound doors
Over 96% of computers produced are received within hours in the APL Logistics
warehouse, which utilizes a proprietary WMS (warehouse management system)
interfacing with the customer's TMS (transportation management system). The TMS

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manages order consolidation, picking instructions, and overall order management.
Picking occurs in designated zones, with 80% item/ case picking and 20% bulk/full
pallet picking.

APL Logistics aims to process orders within hours of receipt, shipping most of them
within that time frame. These orders often involve combining the customer's
computers with printers, monitors, and accessories from other manufacturers. APL
Logistics manages the inventory for these components through vendor-managed
inventory (VMI) programs, minimizing on-hand finished goods inventory.

APL Logistics manages deliveries through its own fleet of 160 trucks and contracted
carriers, handling last-mile deliveries in major cities.

APDC / SMI / Asia Customization and Testing Center

Distribution Center (APDC), its SMI (supplier managed inventory) hub, and Asia
Customization and Testing Center. Having the three functions within one facility
reduces the amount of product handling from configuration through testing and
distribution.

For systems, the operation uses APL Logistics’ proprietary WMS interfaced to its
customer’s SAP ERP (enterprise resource planning) system. Approximately 3,200
SKUs (stock keeping units) of printers, cartridges, and accessories are maintained in
inventory. APL Logistics has a two-hour order-to-ship cycle time and the operation
processes approximately 30-50 export orders per day. Most orders require single or
multiple item picks and are packed out.

APL Logistics provides value-added services such as kitting with market-specific

accessories and product labeling. The facility also houses printer configuration lines
and an inkjet customization line, staffed by 20 employees, who customize
approximately 80 different printer models annually. Parts and components from seven
suppliers are managed in a secure, adjacent SMI hub. The laser printer lines can
configure 10 printers per hour, while the inkjet line can configure 80 printers per hour.
Each printer undergoes a quality check before packaging.

In the last operation, different models of printers are tested. Each model can be tested
for basic functionality, paper feeding, online function, condition, and ink cartridge
testing. Approximately 500 printers are tested daily.

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APL Logistics' acquisition of Zhiqin Group strategically strengthens its value-added
warehousing and distribution operations in China.

India

India is one of the fastest growing auto markets in the world. And VASCOR is a joint
venture between APL Logistics and Fujitrans Corporation of Japan. It is a third-party
logistics (3PL) specialist dedicated to servicing the specific needs of the global
automotive industry. This subsidiary is its main expansion strategy to Asia dominance
process where automotive sector is maximum concentrated

Unique challenges, unique solutions: APL Logistics Vascor Automotive Pvt Ltd.
offers specialized supply chain solutions for Original Equipment Manufacturers
(OEMs) in India. This collaboration leverages the combined expertise of APL
Logistics and VASCOR Logistics, two leading supply chain powerhouses.

Rail Transport

APL Logistics Vascor Automotive has introduced AutoLinxSM, a unique rail-based

solution for efficient, reliable, and damage-free distribution of finished vehicles across
India. This innovative approach has accelerated the adoption of rail transportation
within the Indian automotive sector. The company's extensive network and owned rail
assets, combined with a strong road transporter network, enable customized logistics
solutions for OEMs, ensuring timely and cost-effective delivery.

AutoLinxSM offers a complete door-to-door service, which includes:

1. Collection of finished vehicles from OEM plants

2. Vehicle loading and unloading at terminals
3. Long distance rail haulage of vehicles on a specifically built wagons
4. Delivery to final destination
5. Tracking and tracing of shipments
6. Reporting of KPI, damage rates, repair services

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 Scope of Service in Finished Vehicle Transportation

Source: APL LOGISTICS | VASCOR

Vehicle Distribution Centre

A network of strategically located vehicle distribution centers near rail terminals is

operated. These centers offer various value-added services, including:

1. Storage of vehicles
2. Dispatch of vehicles to
3. Dealers after invoicing
4. Installation of accessories
5. Delivery to final destination
6. Repairs
7. Claims management - assessment, processing and resolution of damage claims

The company's post-GST strategy involves stocking vehicles near customer sale points
to minimize transportation and handling. Technology and expertise from Vascor Ltd.
enable efficient vehicle handling and parking. The first Regional Stockyard has
commenced operations in Chennai, facilitating stock transfers and faster delivery to
dealers.

On November 7, 2022, APL Logistics inaugurated a modern Global Business Services

Centre in Chennai, India. The Centre is located at Olympia National Tower,
strategically located in the Guindy City district of Chennai – India.

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The center will initially focus on serving customers in South Asia and EMEA
countries, improving response times and data accuracy. Over time, the center's services
will expand to other regions.

Chapter 5: Benchmarking

The logistics industry, the backbone of the global economy, is witnessing a non-stop
race between the "giants". In the context of this fierce competition, it is extremely
necessary to compare and evaluate the capabilities of leading businesses. APL
Logistics, with its extensive experience and network, has always been considered one
of the formidable names. However, for a more comprehensive view,they will compare
APL Logistics with three direct competitors, CEVA Logistics, DB Schenker, and
Yusen Logistics. The selection of these three companies is based on the same scale of
operations, wide range of services and leading position in the international logistics
market

We create a benchmarking table for 4 companies: including APL Logistics, CEVA

Logistics, DB Schenker, and Yusen Logistics, across the key performance factors:
Service, Delivery, Quality, Cost and Risk Management. (At first, we consider that we
should choose the leading companies like FEDex, Amazon, but the scale between
those companies with APL Logistics is not the same, so we would like to change to the
middle companies.)

Overall, for the best view of each company, we also conduct the table with the scale
from from 1 to 5 (where 5 is excellent and 1 is poor):

Table 2: The Benchmarking table of 4 Logistic company

Source: Gartner Peer Insight

Factor APL Logistics CEVA Logistics DB Schenker Yusen Logistics

Service 4 (Responsive 5 (Diverse, 4 (Reliable but 5 (Personalized

but needs tech integrated lacks and
improvement) solutions) personalization) customer-focuse
d)

Delivery 4 (Reliable 5 (Tech-driven, 4 (Consistent 4 (Strong in

on-time stable) with advanced Asia, flexible
performance in tracking) management)
key markets)

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 Quality 4 (Continuous 5 4 (Standardized 5 (High
improvement (Industry-specifi and compliant) standards,
via audits) c quality special goods
assurance) expertise)

Cost 5 (Competitive 4 (Reasonable, 3 (Good for 4 (Cost-effective

with comprehensive SMEs; premium for regional
value-added packages) may cost more) businesses)
services)

Risk 5 4 (Effective 4 (Preventive 4 (Flexible,

Manage (Comprehensive monitoring) strategies, handles
ment sustainability-fo advanced tech) complexity)
cused)

5.1. Service

APL Logistics provides highly responsive customer service, which positions it as a

strong competitor in the market. However, it lags behind CEVA Logistics, which offers
more diverse and integrated supply chain solutions, and Yusen Logistics, which excels
in personalized customer relationships. Both of these competitors go beyond
responsiveness to deliver holistic and tailored services. While APL's focus on
responsiveness is an asset, enhancing its technological integration would enable it to
offer a smoother, more efficient service comparable to its rivals.

On the other hand, APL is better than DB Schenker in terms of service customization,
as DB Schenker's offerings tend to focus on reliability without emphasizing
personalized customer engagement.

5.2. Delivery

APL Logistics ensures reliable on-time delivery, especially in key markets, making it a
dependable partner for businesses in specific regions. However, CEVA Logistics
surpasses APL with its tech-driven approach to delivery efficiency, offering a broader
and more stable service. Yusen Logistics, with its strong presence in Asia and flexible
transport management, also provides a regional advantage that could challenge APL’s
market focus. APL outperforms DB Schenker in terms of targeting key markets,
although DB Schenker benefits from advanced tracking systems. Therefore, to remain
competitive, APL could enhance its delivery technologies and expand its geographical
coverage for broader market appeal.

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 5.3 Quality

APL Logistics emphasizes continuous improvement through regular audits, ensuring

steady quality enhancements. This approach is an advantage over DB Schenker, which
focuses on standardized processes and compliance without a dynamic improvement
framework. However, CEVA Logistics and Yusen Logistics lead in quality, with CEVA
specializing in industry-specific assurance and Yusen excelling in handling specialized
goods with high standards.

APL's focus on adaptability gives it an edge in long-term improvement, but investing

in specialized capabilities or niche solutions could help it rival CEVA and Yusen
strong industry-specific expertise.

5.4. Cost

APL Logistics stands out for its competitive pricing and value-added services, offering
better affordability compared to DB Schenker, whose premium services can be
expensive for some clients. While CEVA Logistics and Yusen Logistics provide
reasonable and cost-effective options, APL’s combination of pricing and added value
gives it a distinct edge, especially for businesses seeking comprehensive services
without overspending. This strong cost proposition makes APL a preferred choice for
companies aiming to balance quality and affordability in their logistics solutions.

5.5. Risk Management

APL Logistics excels in risk management by combining comprehensive strategies with

a strong focus on sustainability. This approach distinguishes it from CEVA Logistics,
DB Schenker, and Yusen Logistics, which prioritize effective monitoring and
flexibility but lack APL's environmental emphasis. By integrating sustainability into
its risk practices, APL not only mitigates risks but also aligns with the increasing
demand for eco-friendly supply chain solutions.

This makes APL better positioned to appeal to clients seeking both reliability and
environmental responsibility, giving it a competitive advantage over its peers.

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 Conclusion

APL Logistics has successfully established itself as a prominent player in the global
logistics and supply chain management industry. Through its extensive network,
strategic acquisitions, and investments in technology, the company has demonstrated
resilience and adaptability in an ever-changing global market. The acquisition by
KWE in 2016 proved to be a transformative milestone, enabling APL Logistics to
expand its operational scope, enhance service quality, and improve overall efficiency.
Despite the challenges posed by the COVID-19 pandemic and other market
disruptions, APL Logistics has maintained a competitive edge by prioritizing
customer-centric strategies, digital transformation, and sustainable trade practices.

Comparatively, APL Logistics exhibits strengths in risk management,

cost-effectiveness, and operational reliability. Its focus on sustainability and tailored
customer solutions differentiates it from competitors like CEVA Logistics, DB
Schenker, and Yusen Logistics. However, there are areas for improvement, particularly
in technological integration and service diversification, to match the industry's top
performers fully. By addressing these challenges, APL Logistics can strengthen its
market position and continue to be a trusted partner in global supply chains.

Overall, APL Logistics' journey reflects a commitment to innovation, strategic growth,

and sustainable practices, making it a key contributor to the logistics industry’s
evolution. While the company has made significant strides, continuous improvement
and adaptation will be critical to maintaining its leadership in the dynamic global
logistics landscape.

Recommendations

To stay competitive and drive growth, APL Logistics should focus on improving
technology, building stronger partnerships, and tailoring services to meet market
needs. The following recommendations outline key actions to enhance performance
are showing below:

Invest in Technology
APL Logistics should prioritize upgrading its technological infrastructure to streamline
operations and improve overall efficiency. By adopting advanced analytics and digital

24
tools, the company can enhance data management and support better decision-making
processes.

=> Improved technology will not only boost operational efficiency but also enable
seamless integration with client systems, addressing its current shortcomings in tech
integration compared to competitors like CEVA Logistics.

Strengthen Partnerships
Building stronger partnerships with key logistics providers and industry stakeholders
will enhance APL’s flexibility and supply chain optimization capabilities.
Collaboration with established players can help the company expand its service
offerings, access new markets, and improve its ability to meet customer demands more
effectively.

Focus on Customization
APL Logistics should develop more tailored solutions to cater to the unique needs of
specific industries, such as automotive, retail, or healthcare. This would help the
company compete with providers like CEVA Logistics, which offers industry-specific
solutions. Customization will also allow APL Logistics to better address complex
customer demands, thus improving client satisfaction and loyalty.

Enhance Sustainability Efforts

Sustainability has become a critical factor in the logistics industry, and APL Logistics
can capitalize on this trend by implementing eco-friendly practices across its
operations. Initiatives such as optimizing transport routes to reduce carbon emissions,
adopting energy-efficient warehouses, and using alternative fuel vehicles can position
the company as a leader in sustainable logistics. Enhanced sustainability efforts will
not only align with global client demands but also differentiate APL from competitors.

Expand Geographical Reach

To capture new opportunities, APL Logistics should focus on expanding its presence
in emerging markets. Targeting regions with high growth potential, such as Southeast
Asia, Africa, or Latin America, therefore, help the company strengthen its global
network. This strategy will allow APL Logistics to compete more effectively with
global players like DB Schenker and Yusen Logistics, which already have extensive
international networks.

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