What to Look for in a Food Distribution Warehouse Provider

Makers of all types of products turn to third-party logistics (3PL) providers to optimize warehousing and distribution operations in order to meet modern supply chain demands. Makers of food products, however, have a host of safety and regulatory requirements to contend with that make selecting the right 3PL even more crucial. In this article, we’ll examine the many things you’ll need to look for in a food distribution warehouse provider to not only optimize your operations – but do so safely as well.

But first…what are we talking about?

A big part of most food logistics operations involves temperature and climate control. Potentially confusing matters, however, is that many terms related to temperature and climate are used interchangeably. So, to make sure you’re speaking the same language as your prospective 3PLs, let’s first define some of the key logistics terms involved.

For instance, the term “temperature-controlled” is often used as a general term but it can also describe very specific temperature ranges at which products must be kept. A warehouse that has temperature-controlled space utilizes cooling (and/or heating) units to keep the temperature within a set range. These units are strategically placed throughout the space to ensure that the area stays in range.

The most common warehouse temperature ranges are:

• Ambient. Refers to the natural temperature of the warehouse.
• Air conditioned. Typically refers to a temperature between 56°F and 75°F. Confectionery products are a good example of a product that must avoid hot and cold extremes.
• Refrigerated. Typically refers to a temperature between 33°F and 55°F.
• Cold/Frozen. Typically refers to a temperature at or below 32°F.

The following are additional temperature and climate-related terms you’ll need to understand.

• Climate-controlled storage. While many people use this term interchangeably with temperature-controlled storage, there are key differences between the two. With climate-controlled storage, the humidity of the space is regulated in addition to temperature. Commercial humidifiers/de-humidifiers are used along with other equipment to ensure that humidity stays within required ranges for products.
• Temperature mapping. This process utilizes sensors to measure temperature in different areas of the warehouse space. Most 3PLs will go through a temperature mapping process several times a year and adjust cooling or heating equipment based on the results.
• Temperature monitoring. While temperature mapping is a proactive method of ensuring optimal temperature coverage, temperature monitoring is the day-to-day observation and management of those temperatures.
• Lot control. Items that have common characteristics important to the manufacturer (e.g., the same expiration date) are given a lot number by the manufacturer and/or by a 3PL’s warehouse management system as they are received by the warehouse. This lot number allows 3PLs to quickly identify batches of items in the event of a recall. It also enables the 3PL to perform inventory management protocols like FIFO (first in first out; the oldest lots of items will be distributed first) and FEFO (first expired first out; the products closest to their expiration dates will be distributed first).
• Food Safety Plan. Under the Food Safety Modernization Act (FSMA), producers of food products must create a Food Safety Plan that seeks to minimize the risk of food contamination.  According to the FDA, the Plan must include a hazard analysis, preventive controls to address potential problems, and a plan for oversight and management of preventive controls.

10 questions to ask prospective food distribution warehouse providers

With terminology out of the way, it’s time to vet your prospective warehouse providers. Asking the following 10 questions will go a long way in determining whether a 3PL is capable of handling your food warehousing operations.

1. Can you store multiple temperature ranges? Whether your products require ambient, refrigerated or frozen space, there are warehousing providers that can cater to your specific temperature range requirements. There are also providers that can handle all your temperature ranges within the same facility. This is achieved through physical segregation measures at the facility as well as technology (e.g., warehouse management system – WMS) to support and maintain that segregation. By partnering with a 3PL that can handle all your ranges, you can eliminate time and costs associated with outsourcing to multiple providers.
2. What temperature monitoring systems do you have in place? While it’s vital that your products are stored in accordance with their temperature requirements, it’s even more important that those temperatures stay in range 100% of the time. To accomplish this, your 3PL will have a robust internal monitoring system to track temperatures 24/7/365. Many 3PLs will have an external monitoring service that monitors temperatures in conjunction with its own.
3. What happens if temperatures go out of range? In the event that monitoring shows an area to be out of range, you’ll need to know that your 3PL is on the case immediately – even if it’s outside of business hours.
4. Do you control and monitor humidity in addition to temperature? When it comes to the integrity of food products, humidity can be every bit as important as temperature. If it’s important to your products, you will want to partner with a provider that offers climate-controlled warehousing and not just temperature-controlled warehousing.
5. Can your WMS handle ______? Your provider will manage your warehousing operation with its warehouse management system (WMS). A WMS is the digital cornerstone of the modern warehouse, performing functions such as inventory management and pick and pack/eCommerce functions. In addition to your operation’s unique requirements, your 3PL’s WMS should include capabilities such as customized stock rotation (e.g., FIFO, FEFO), UCC-128 label support, integration with carrier (e.g., FedEx) and eCommerce (e.g., Shopify) platforms, and custom reporting on key metrics.
6. How do you ensure compliance with the FSMA, GMP and other regulations? Whether it’s a requirement related to the Food Safety and Modernization Act (FSMA), Good Manufacturing Practices (GMP) or your own company requirements, you need to make sure that your 3PL provider’s practices will be in full compliance.
7. Does your warehousing operation undergo external audits? As you vet your prospective food logistics services providers, keep in mind that there are expert agencies that may have already inspected them ahead of you. Such agencies include AIB International, formerly the “American Institute of Baking.” AIB is trusted by logisticians across the country to monitor warehouse safety and cleanliness standards. A ‘superior rating’ from an agency like AIB means that your provider is likely ‘walking the walk’ when it comes to food industry best practices.
8. Can we audit your facility/operation? As impressive as your prospective 3PL’s audit history may be, you still may want your own internal team to conduct a thorough audit of the 3PL’s operation to make sure that it can comply with your own internal standards. A good 3PL will welcome such an audit and accommodate you every step of the way.
9. Do you offer other temperature-controlled logistics services? In addition to temperature-controlled warehousing, many 3PLs can handle additional components of your supply chain (e.g., transportation) while keeping your products’ temperatures in range.
10. When can we visit? As important as the questions above are, a good old-fashioned site visit will often tell you much of what you need to know about a 3PL’s ability to effectively warehouse your products. In addition to seeing some of what’s already been discussed in action, a site visit is a good opportunity to assess a facility’s basic – yet vital – characteristics like sanitation, structural integrity, security, ease of access, associate demeanor, and pest control. Be sure to visit your prospective provider at least once before proceeding with a partnership.

Additional food distribution warehouse considerations

In addition to the questions above, there are additional capabilities you may want to see in your prospective 3PL. These may include the following.

Ability to perform mock recalls

For makers of food products, recalls can occur when a specific lot or batch of products needs to be removed from inventory. As all products are scanned into a 3PL’s WMS upon entry into the warehouse, and every movement within the warehouse carefully managed by the same WMS, such a recall should be relatively straightforward.

To make sure recall events run smoothly and efficiently, however, many leading 3PLs leave nothing to chance. These 3PLs routinely perform practice runs called ‘mock recalls’ that are every bit as thorough as the real thing and follow the same basic process:

1. Recall event specifics are outlined between the 3PL and its customer
2. The WMS flags the affected products, assigns a hold location for their storage, and prevents them from being distributed
3. Recalled items are placed in hold location
4. 3PL acts as instructed by customer

Prevention of cross contamination

Food products are sensitive items that don’t always play nice with others. The safe consumption of foods can be severely impacted if those products are exposed to other products. For example, 8 items – milk, peanuts, eggs, soy, tree nuts, wheat, fish, and shellfish – account for 90% of allergic reactions in the U.S. each year. Something as seemingly benign as a pallet of bananas can thus pose serious health risks to the population if, for instance, that same pallet previously held a nut product. The prevention of cross contact (i.e., exposure of one product to another) is therefore paramount at food and pharmaceutical storage facilities such as 3PL warehouses.

There are many steps that can – and must – be taken to prevent cross contact at food and/or pharmaceutical storage facilities. These include adherence to all related FSMA/Food Safety Plan regulations, as well as the facility’s written policies and procedures. Cross-contact-prevention measures include:

• Separation of materials. Products in the food warehouse must be separated – and kept separate – from each other. This includes movement of products through unauthorized areas.
• Education of Associates. Warehouse staff must be adequately trained to recognize the potential allergens at the facility, the opportunities for cross contact, and the policies and procedures in effect at the facility.
• Designation of facility sections. Areas of the warehouse containing sensitive items must be clearly identified; unapproved equipment and unauthorized personnel must be prevented from entering each given section.
• Sanitation efforts. Associates must wash hands with soap and water after handling any food or pharma product.  Appropriate clothing must be worn and changed or cleaned as needed. Equipment and storage areas must be maintained and cleaned in accordance with facility and/or regulatory requirements.
• Designation of supplies. Supplies such as stretchwrap and pallets can be designated for a specific product type and their use will be solely limited to that product type.
• Quarantine of rejected items. Rejected items must be appropriately identified and quarantined in order to prevent their use. Similarly, incomplete or incorrect packaging for any item should result in removal of that product from the product pool until it can be repackaged or discarded.

Food import services

If you’re importing products from overseas, many 3PL providers can perform the following import services (and more) once your items arrive at the port.

Receiving and drayage. Your 3PL can receive your container and deliver it to a nearby warehouse or a destination of your choosing.

Transloading. At the warehouse, your 3PL will unload your containers for storage or transloading. The empty containers will be brought back to port quickly so that you avoid detention charges.

Inspection and sampling. Food logistics companies that are registered with the FDA will enable FDA representatives to inspect your products at their warehouses. Some 3PLs are also able to provide product samples to your quality control team.

At Kanban Logistics, the way that sampling works is as follows. We have customers with nearby manufacturing plants that have trained our team members on their sample-collecting processes. When containers of these products come in and are unloaded, our team members collect the samples and deliver them to the nearby production facility. Their quality control team then tests to ensure that the product is fit for distribution. If it is, our distribution services will proceed as normal. If it’s not, we can quarantine and/or destroy (with certification) the product lots in question.

By having a food logistics company trained in its sampling methods, you can avoid timely steps in sending representatives out to your 3PL.

Just in Time (JIT) services. Much like components of machine products can be stored by a 3PL and delivered on an as-needed basis, the same can apply to food products.

Moving forward with a food distribution warehouse provider

All of the questions and factors examined in this article can guide your vetting process and help identify the 3PL that can truly be a partner to your food logistics operation.

But even when you seem to have found your provider, it’s still a good idea to take a cue from Ronald Reagan: Trust but verify.

Tour the operation and ask the tough questions: about the accuracy of monitoring gauges, temperature reporting, training for associates, and alert processes when temperature readings fall out of range. Look for a full understanding of the issues not only from executives, but from the associates on the floor.

You’ll then be well on your way to running a safe, efficient and compliant food warehousing operation.