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Supply chain, marketing and consumption
The LandLogistik Operational Group in the German State of Brandenburg is finding ways to improve farm productivity and quality of life in rural areas by reducing logistics costs – allowing rural producers to access existing freight space in the transport sector and on the local bus.
The Wolters family runs a dairy farm and they produce cheese, which they market through several channels, including direct sales to gourmet restaurants and supermarkets. Looking for ways to save on transport costs, they joined forces with Anja Sylvester of Interlink, an energetic and enthusiastic innovation adviser working on logistics and mobility in rural areas. Together, they set up the LandLogistik Operational Group to develop a platform allowing rural producers to identify transport opportunities to bring their produce to the market.
We spoke to Anja to learn more about this innovative way to create new logistics opportunities for rural areas:
I first met Pieter Wolters through our project called Combibus-Projekt in the rural district Uckermark in 2012. We originally started this project with the idea of generating additional income for the public transport in this rural district, to ensure that the bus could continue running frequently. So we managed to integrate the transportation of goods on the normal route of the public bus company. Now, nearly every local bus delivers all sorts of goods (except for hazardous items), it is now called the “Combibus”.
The most successful part of this initiative was the transport of food products. In fact, we even noticed the effects of our project on the local economy: local farms and other businesses were able to increase their production and jobs were created. New business models were developed between different partners, for example, hotels in the area began to include local farm products in their breakfast menu.
Pieter Wolters, dairy farmer, was the first to realise the benefits of using public transport for his food logistics. The bus runs at the same time every day and can deliver reliably and punctually to customers – at an affordable transportation fee. Even the delivery of his homemade ice-cream, milk and cheese products is manageable thanks to this precise timetable. He quickly saw opportunities to expand his business, selling his products to local hotels and even through the local tourist agency. He also helped to set up a brand for local farm products, and encouraged other farmers to join and use the Combibus for their deliveries. Around 70 farm enterprises have now joined this local brand initiative, and their market has grown as a result.
While the Combibus provides a good solution for farm enterprises to deliver their products to other businesses in the district, it does have some limitations. So we started thinking how it could be combined with other possibilities. For example, we found a food carrier who could take Pieter Wolters’ products to a customer in Berlin, 120km away.
In the Operational Group, we decided therefore to work on a system that could complement the Combibus, combining space on public transport with ordinary logistics to provide a full delivery service, including door to door delivery and tracking. We wanted to concentrate on food logistics, especially for farmers, to help them save time on logistics, and find an affordable solution to ‘cover the last mile’, which is often the most expensive.
The Landlogistik Operational Group aims to develop and test an independent online platform which will help rural businesses handle day to day logistics, optimising the use of the existing transport services and freight infrastructure. It focuses specifically on providing logistics solutions in rural areas by involving public transport operators. By doing so, we hope to increase the efficiency and sustainability of logistics systems, and improve the economy and quality of life in rural areas. Combining the regular transport sector with public transport can help bridge the last mile to and from the farm. Smart pooling of transport capacity should also save energy and reduce CO2 emissions. Finally, creating these new, affordable delivery options can open up new market opportunities for farms and other rural businesses.
To successfully do this, we need a paperless, digital solution – to standardise and allow one time entry of data. In parallel, we are working on another, complementary innovation: a label with a barcode containing information for all the carriers – what the delivery contains, where it has to go. This will provide a complete tracking system.
Pieter Wolters told me “We have good reasons to take part in this project: We must reduce the organisational effort regarding daily transport costs for each shipment. Reducing transport costs is the only way to reduce or stabilise the price of our products because they represent a high share of fixed costs. LandLogistik will also enable us to combine free freight space with our online shop. By combining software applications and the online solution, we will not only save time, but both we and our customers will also save money.”
Farms and rural enterprises in other parts of Germany and Europe will be able to use the software too.
The third member of the Operational Group is our partner Transinet GmbH. They are dealing with the development of the software. We are using their logistic programme as a basic application and the new demands of the project are being included as new add-ons. The innovative aspect is mainly to combine real-time timetable data out of the public transport sector with real-time-data of trucking companies or Courier Express and Parcel services.
The idea is that farmers can see all of the available freight space using information gathered from many different transport companies and services. The platform is transparent and neutral. The whole process – order entry, the overview of free freight space, transport routing, invoices – is digital and paperless, and farmers only need to enter the data in one system, once. This saves time and reduces the number of errors by the transport companies or customers.
The tasks are clearly defined. Interlink has the knowledge about public transport, Transinet brings in logistic matters and the software solution. Farmers have very little extra time, so the role of Family Wolters is mainly an advisory job. Wolters is a “user” – and so they can show us the exactly which problems with the platform need to be solved and stand by to give us a first guidance to solve them. The involvement of this type of partner in the Operational Group is essential. To get the full market overview, we also will talk to all the other farmers in Brandenburg, combined with representatives of the logistics and public transportation sectors.
Eventually it would be wonderful if all rural enterprises in Brandenburg and beyond could use the platform that we are developing to handle their deliveries, at an affordable rate. This could really benefit the economy of the rural areas. It is a big task that also concerns political and economic aspects. It is a new approach to reorganise our transport system. Instead of putting additional vehicles on the street, we need to cleverly combine existing transport opportunities. We hope we can give a new impulse to do this, to give a hint of how it could work. But everyone has to participate because it requires combined thinking and processing. Time will be too short in this project to change the whole system. We will be satisfied if we manage a pilot application.