By working with a competitor to boost transportation efficiency, Ocean Spray cut freight costs by 40 percent and greenhouse gases by 20 percent in one major lane.
Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.
You could call it a classic case of serendipity. Agricultural cooperative Ocean Spray had just hit a major milestone in its supply chain sustainability program when it received an unexpected proposal that promised to take its carbon reduction efforts to the next level.
As part of a network redesign, the Massachusetts-based producer of fruit juice and food—most notably its iconic cranberry juice—had recently opened a new DC in Lakeland, Fla., to serve customers in the Southeast. By centralizing supply closer to clients, the company had already slashed millions of miles out of its distribution network, cutting both freight costs and carbon emissions.
But soon after the Lakeland facility opened in 2011, Ocean Spray was approached by Wheels Clipper, an Illinois-based third-party logistics service provider (3PL) that specializes in intermodal, truckload, and refrigerated shipping. The 3PL had an intriguing business proposition for the cooperative. One of its clients, Tropicana, which is also one of Ocean Spray's competitors in the fruit juice business, was already shipping fresh fruit by boxcar on CSX Transportation trains from Florida to New Jersey—and sending empty boxcars back to Florida. Since much of Ocean Spray's Lakeland-bound freight originated in Bordentown, N.J., Wheels Clipper suggested that Ocean Spray could take advantage of that backhaul capacity. That would mean a substantial savings in both transportation costs and carbon emissions.
Both are significant goals for Ocean Spray. "For us, sustainability is an enterprisewide focus," says Kristine Young, who leads the cooperative's sustainability efforts. She works with growers and suppliers on a variety of sustainability efforts that encompass energy and water use, packaging, and transportation, among others.
Young believes that Ocean Spray's commitment to sustainability may be what attracted the attention of the third party. Ocean Spray has been a partner in the Environmental Protection Agency's (EPA) SmartWay program for several years, as are 95 percent of the company's carriers. Participants in the program commit to benchmarking their shipping operations and taking steps to reduce fuel use and emissions. "Our SmartWay participation was a clear indication we are interested in sustainability," she says.
COST AND EMISSIONS REDUCTIONS
Ocean Spray decided Wheels Clipper's proposal was worth pursuing. After looking into the matter further, it determined it could indeed take advantage of the backhaul opportunity—though it would require a few minor adjustments in its shipping patterns.
"One thing we had to look at was our load planning," Young recalls. Each truckload shipment held 19 pallets of goods, but boxcars handle 38. "We had to take that into consideration in our order fulfillment planning," she says. "We had to do a little bit of work on the pallet size and the configuration of the pallets."
Delivery schedules also required some adjustment. Shipping goods by truck takes three days, while the journey by rail takes four to five days. That meant asking the Florida DC to carry more inventory than it might otherwise have done.
The payoff, however, promised to be enormous. The arrangement that was eventually put in place resulted in Ocean Spray's shifting 80 percent of the New Jersey-to-Florida shipments to rail over a 12-month period, yielding reductions in both shipping costs and emissions.
The emissions cuts attracted the attention of the Environmental Defense Fund (EDF), which was putting together a series of case studies on companies that have cut freight costs and carbon emissions through improved logistics practices. EDF, in turn, approached the Massachusetts Institute of Technology's (MIT) Center for Transportation and Logistics (CTL) and asked it to conduct a study of the Ocean Spray program under EDF's sponsorship. In January, the CTL released its study on Ocean Spray and the results it achieved.
The emissions reductions in the lane were also impressive. According to the MIT analysis, the shift resulted in a savings of 1,300 metric tons of carbon dioxide—or CO2—a 68-percent reduction in the lane, meaning an overall emissions reduction in Ocean Spray's distribution network of 20 percent. The MIT study says that was the equivalent of cutting fuel use by 100,000 gallons.
SUCCESS FACTORS
In addition to quantifying the savings, the CTL report looked at the factors that made the program successful. In Ocean Spray's case, the company had a number of things working in its favor, says Dr. Edgar A. Blanco, research director for the CTL and leader of the study.
First, Ocean Spray owned the facilities at each end of the lane. That was crucial, Blanco explains, because it meant the company could increase inventory at the Florida DC and not ask customers to adjust their own order patterns. "Without opening the Florida DC, they would not have had the flexibility to move that many goods by rail to Florida," he says.
Second, Ocean Spray had the right kind of freight profile. Rail shipping works well for products that move in fairly regular volumes. Although Ocean Spray had all kinds of shipments, Blanco says, much of its freight consisted of what he characterizes as "constant and continuous" shipments. "The warehouse still had to plan for some products that don't [fall into this category], and those still move by truck," he notes. "While that increased complexity, it was worth it from a cost perspective and an environmental perspective."
Third, the shift to rail proved workable because of the rail terminals' proximity to the Ocean Spray DCs at each end. The dray from the New Jersey DC to the CSX rail terminal is about 60 miles, and the dray from the Florida terminal to the Lakeland DC about 65 miles. "That's crucial for a couple of reasons," Blanco says. "One is simply the ability to coordinate shipping. But it is also crucial from a CO2 perspective." Longer drays would quickly have eroded the cost and emissions savings, he explains.
The success of the project has led Ocean Spray to begin evaluating other lanes for possible conversion to rail. "It took us a little while to work through [the program]," Young says, "but it has been a huge success. Internally, we talk about how we can [identify] other high-volume lanes where we might be able to find rail opportunities.
"This whole project shows there are real savings in both cost and carbon," she adds. "It just makes good business sense for us to collaborate."
Calculating CO2
Looking to calculate your own freight transportation carbon footprint but don't know how to go about it? We asked Edgar Blanco, research director for MIT's Center for Transportation and Logistics and author of the Ocean Spray study, what's involved.
According to Blanco, a number of factors go into the calculation of total CO2 emissions from freight transportation: the type of equipment, the weight of the equipment and the load, how it's operated, and more. That kind of information may be readily available to equipment owners, but it's a bit more complicated for shippers who hire truckers and railroads to move their freight.
Still, Blanco argues, it can be done. Over the past few years, carriers like CSX Transportation have published network-level data showing the amount of CO2 emitted. Blanco says those numbers are broken down by distance and weight. As a result, researchers can derive a "rail emission factor" that he considers a fairly good estimate for shippers to use in their own calculations.
Trucking gets more complex because of the sheer number of motor carriers and their wide diversity. But Blanco contends that it's also possible to get a broad measure to compare modes. He cautions, however, that there is not enough precise data to differentiate among carriers in the same mode.
Here's a brief look a the calculations that Blanco used in his research for the Ocean Spray case study:
The road emission factor represents the CO2 generated by moving one U.S. ton of cargo (2,000 pounds) one mile using road transportation. For the study, MIT used 149.7 grams of CO2 per ton-mile, a number that the study says corresponds to the average emissions of all fleets included in the EPA's SmartWay Shipper Tools.
The rail calculation was a bit more complex, as it had to include the origin and destination drayage as well as the rail shipping. The formula:
MIT used 25.2 grams of CO2 per ton-mile as the rail emission factor, a number developed by the Greenhouse Gas Protocol, an internationally used accounting tool for quantifying greenhouse gas emissions. For the drayage, it used the same factor as for the truckload shipments.
The result of the calculations, based on Ocean Spray's annual shipping of 11,550 U.S. tons: Carbon emissions would be 1,900 metric tons for truckload shipments and 565 metric tons for intermodal shipments. (A metric ton is equal to 1,000 kilograms or 2,205 pounds.)
But it could also be argued that the Ocean Spray shipments to Florida were zero net emissions, the MIT study notes. Why? CSX was already moving goods by train from New Jersey to Florida, and those emissions were already being created. The additional weight added by Ocean Spray products was negligible and therefore, contributed little to nothing to the existing carbon emissions.
Generative AI (GenAI) is being deployed by 72% of supply chain organizations, but most are experiencing just middling results for productivity and ROI, according to a survey by Gartner, Inc.
That’s because productivity gains from the use of GenAI for individual, desk-based workers are not translating to greater team-level productivity. Additionally, the deployment of GenAI tools is increasing anxiety among many employees, providing a dampening effect on their productivity, Gartner found.
To solve those problems, chief supply chain officers (CSCOs) deploying GenAI need to shift from a sole focus on efficiency to a strategy that incorporates full organizational productivity. This strategy must better incorporate frontline workers, assuage growing employee anxieties from the use of GenAI tools, and focus on use-cases that promote creativity and innovation, rather than only on saving time.
"Early GenAI deployments within supply chain reveal a productivity paradox," Sam Berndt, Senior Director in Gartner’s Supply Chain practice, said in the report. "While its use has enhanced individual productivity for desk-based roles, these gains are not cascading through the rest of the function and are actually making the overall working environment worse for many employees. CSCOs need to retool their deployment strategies to address these negative outcomes.”
As part of the research, Gartner surveyed 265 global respondents in August 2024 to assess the impact of GenAI in supply chain organizations. In addition to the survey, Gartner conducted 75 qualitative interviews with supply chain leaders to gain deeper insights into the deployment and impact of GenAI on productivity, ROI, and employee experience, focusing on both desk-based and frontline workers.
Gartner’s data showed an increase in productivity from GenAI for desk-based workers, with GenAI tools saving 4.11 hours of time weekly for these employees. The time saved also correlated to increased output and higher quality work. However, these gains decreased when assessing team-level productivity. The amount of time saved declined to 1.5 hours per team member weekly, and there was no correlation to either improved output or higher quality of work.
Additional negative organizational impacts of GenAI deployments include:
Frontline workers have failed to make similar productivity gains as their desk-based counterparts, despite recording a similar amount of time savings from the use of GenAI tools.
Employees report higher levels of anxiety as they are exposed to a growing number of GenAI tools at work, with the average supply chain employee now utilizing 3.6 GenAI tools on average.
Higher anxiety among employees correlates to lower levels of overall productivity.
“In their pursuit of efficiency and time savings, CSCOs may be inadvertently creating a productivity ‘doom loop,’ whereby they continuously pilot new GenAI tools, increasing employee anxiety, which leads to lower levels of productivity,” said Berndt. “Rather than introducing even more GenAI tools into the work environment, CSCOs need to reexamine their overall strategy.”
According to Gartner, three ways to better boost organizational productivity through GenAI are: find creativity-based GenAI use cases to unlock benefits beyond mere time savings; train employees how to make use of the time they are saving from the use GenAI tools; and shift the focus from measuring automation to measuring innovation.
According to Arvato, it made the move in order to better serve the U.S. e-commerce sector, which has experienced high growth rates in recent years and is expected to grow year-on-year by 5% within the next five years.
The two acquisitions follow Arvato’s purchase three months ago of ATC Computer Transport & Logistics, an Irish firm that specializes in high-security transport and technical services in the data center industry. Following the latest deals, Arvato will have a total U.S. network of 16 warehouses with about seven million square feet of space.
Terms of the deal were not disclosed.
Carbel is a Florida-based 3PL with a strong focus on fashion and retail. It offers custom warehousing, distribution, storage, and transportation services, operating out of six facilities in the U.S., with a footprint of 1.6 million square feet of warehouse space in Florida (2), Pennsylvania (2), California, and New York.
Florida-based United Customs Services offers import and export solutions, specializing in remote location filing across the U.S., customs clearance, and trade compliance. CTPAT-certified since 2007, United Customs Services says it is known for simplifying global trade processes that help streamline operations for clients in international markets.
“With deep expertise in retail and apparel logistics services, Carbel and United Customs Services are the perfect partners to strengthen our ability to provide even more tailored solutions to our clients. Our combined knowledge and our joint commitment to excellence will drive our growth within the US and open new opportunities,” Arvato CEO Frank Schirrmeister said in a release.
And many of them will have a budget to do it, since 51% of supply chain professionals with existing innovation budgets saw an increase earmarked for 2025, suggesting an even greater emphasis on investing in new technologies to meet rising demand, Kenco said in its “2025 Supply Chain Innovation” survey.
One of the biggest targets for innovation spending will artificial intelligence, as supply chain leaders look to use AI to automate time-consuming tasks. The survey showed that 41% are making AI a key part of their innovation strategy, with a third already leveraging it for data visibility, 29% for quality control, and 26% for labor optimization.
Still, lingering concerns around how to effectively and securely implement AI are leading some companies to sidestep the technology altogether. More than a third – 35% – said they’re largely prevented from using AI because of company policy, leaving an opportunity to streamline operations on the table.
“Avoiding AI entirely is no longer an option. Implementing it strategically can give supply chain-focused companies a serious competitive advantage,” Kristi Montgomery, Vice President, Innovation, Research & Development at Kenco, said in a release. “Now’s the time for organizations to explore and experiment with the tech, especially for automating data-heavy operations such as demand planning, shipping, and receiving to optimize your operations and unlock true efficiency.”
Among the survey’s other top findings:
there was essentially three-way tie for which physical automation tools professionals are looking to adopt in the coming year: robotics (43%), sensors and automatic identification (40%), and 3D printing (40%).
professionals tend to select a proven developer for providing supply chain innovation, but many also pick start-ups. Forty-five percent said they work with a mix of new and established developers, compared to 39% who work with established technologies only.
there’s room to grow in partnering with 3PLs for innovation: only 13% said their 3PL identified a need for innovation, and just 8% partnered with a 3PL to bring a technology to life.
Volvo Autonomous Solutions will form a strategic partnership with autonomous driving technology and generative AI provider Waabi to jointly develop and deploy autonomous trucks, with testing scheduled to begin later this year.
The announcement came two weeks after autonomous truck developer Kodiak Robotics said it had become the first company in the industry to launch commercial driverless trucking operations. That milestone came as oil company Atlas Energy Solutions Inc. used two RoboTrucks—which are semi-trucks equipped with the Kodiak Driver self-driving system—to deliver 100 loads of fracking material on routes in the Permian Basin in West Texas and Eastern New Mexico.
Atlas now intends to scale up its RoboTruck deployment “considerably” over the course of 2025, with multiple RoboTruck deployments expected throughout the year. In support of that, Kodiak has established a 12-person office in Odessa, Texas, that is projected to grow to approximately 20 people by the end of Q1 2025.
Women are significantly underrepresented in the global transport sector workforce, comprising only 12% of transportation and storage workers worldwide as they face hurdles such as unfavorable workplace policies and significant gender gaps in operational, technical and leadership roles, a study from the World Bank Group shows.
This underrepresentation limits diverse perspectives in service design and decision-making, negatively affects businesses and undermines economic growth, according to the report, “Addressing Barriers to Women’s Participation in Transport.” The paper—which covers global trends and provides in-depth analysis of the women’s role in the transport sector in Europe and Central Asia (ECA) and Middle East and North Africa (MENA)—was prepared jointly by the World Bank Group, the Asian Development Bank (ADB), the German Agency for International Cooperation (GIZ), the European Investment Bank (EIB), and the International Transport Forum (ITF).
The slim proportion of women in the sector comes at a cost, since increasing female participation and leadership can drive innovation, enhance team performance, and improve service delivery for diverse users, while boosting GDP and addressing critical labor shortages, researchers said.
To drive solutions, the researchers today unveiled the Women in Transport (WiT) Network, which is designed to bring together transport stakeholders dedicated to empowering women across all facets and levels of the transport sector, and to serve as a forum for networking, recruitment, information exchange, training, and mentorship opportunities for women.
Initially, the WiT network will cover only the Europe and Central Asia and the Middle East and North Africa regions, but it is expected to gradually expand into a global initiative.
“When transport services are inclusive, economies thrive. Yet, as this joint report and our work at the EIB reveal, few transport companies fully leverage policies to better attract, retain and promote women,” Laura Piovesan, the European Investment Bank (EIB)’s Director General of the Projects Directorate, said in a release. “The Women in Transport Network enables us to unite efforts and scale impactful solutions - benefiting women, employers, communities and the climate.”