Dubai's holistic supply chain solution to be highlighted at global meet

The three-day Global Supply Chain and Logistics Conference, organised by the leading industry body, the Council of Supply Chain Management Professionals (CSCMP), will be held at the Jumeirah Beach Hotel from February 21-23.

And the intensive programme includes a special breakout session devoted to education and best practices at which Michael Proffitt, CEO of Dubai Logistics City, will spell out the emirate's regional hub proposition.

"Dubai Logistics City will address the holistic needs of entire supply chains by providing a truly integrated logistics platform instead of the traditional, and more limited focus on transport providers and operators," said Proffitt.

"The right hub solution is crucial to this industry because supply chain failures can be very costly. A recent study by the Georgia Technical Institute and University of Western Ontario, which covered some 861 public companies which had experienced supply chain problems over a 10-year period, reported that when a company announces a supply chain malfunction, such as production or shipment delays, its stock price tumbles nearly 9% and losses can be as great as 20% over six months. That's how serious it is!"

Spread over 25 square kilometres, Dubai Logistics City is a key component of the world's first truly multi-modal transport platform under a single customs-bonded and free zone area. Due to be operational at the end of 2007, DLC, which is the first phase of the huge Jebel Ali Airport City, will eventually combine all required transport modes with a logistics zone with ample space for warehousing and other logistics services, such as order fulfilment, merge-in-transit, postponement-in-assembly, kitting and packing.

"The location, location, location mantra of the real estate industry holds good for DLC," said Proffitt. "It lies next to Jebel Ali Port, now the world's 10th biggest container port, and directly adjacent to Jebel Ali International Airport.

"In designing our world-beating offering we listened to the requirements of supply chain masters. We learnt how these supply chains are set up, where they are most sensitive, what competition they face, what targets they need to reach in terms of market service levels, lead times and costs, what logistics and value-added services they need and what processes need to be improved.

"As a result we have created an appropriate logistics infrastructure against a backdrop of a supportive liberal business environment. We have a unique platform with an infrastructure which addresses the needs of different supply chain players."

At DLC, industrial or distribution companies have been allocated more than 12 million square metres of land for distribution, value-added services and order fulfilment centres. They can choose to self operate or to outsource, to self invest or to use turnkey facilities and, if required, to combine merge-in-transit delivery operations with call centre services on the customer front end.

"Integrators are also able to focus their operations according to the needs of supply chains. They may combine air-side terminals and road express centres with dedicated operations," explained Proffitt.

And industry heavyweight Kuehne + Nagel has become one of the first to sign up to the DLC proposition, choosing it to help manage its contract logistics business. The company is to establish a distribution centre at DLC to complement its existing facilities in Jebel Ali Free Zone and the Dubai Air Cargo Village. Companies building their own facilities will be given access to their sites in the second quarter of this year.

Global supply chains linking the Far East to Europe can also use DLC as the main hub for sea-air business.

"With the port and the airport being integrated in a single customs-bonded area and short distances between ocean container terminals and optimised air cargo facilities, transfer from sea-to-air can be done in world-record timing. For instance, preventing stock-outs in Europe by flying in fashion products directly to market," said Proffitt.

"Effective supply chain management can drive clear business improvement in three primary areas - cost reduction, innovation and risk management - with each of these in turn having its own value creation levers.

"Our sea-air connectivity between Asia and Europe will help reduce transport costs, re-route shipments after dispatch, speed up order and allow pack-and-label in transit."

And DLC, along with JXB, which is the size of London's Heathrow and Chicago's O'Hare airports put together, will further enhance Dubai's global air hub status.

"Operators will be able to merge shipments from different continents and daily connect remote markets with Europe and Asia," explained Proffitt.

According to Proffitt, DLC will help a wide spectrum of industries provide the right product at the right place at the right time, maximising sales and profits.

"DLC will revolutionise supply chains and usher in a new era of cost saving, efficiency and business intelligence. Be it a retailer, distributor, logistics service provider, manufacturer and their entire supplier base, hospitals and pharmaceutical companies, perishables, aerospace and auto spare parts, our tenants will reap tremendous advantages from the streamlining and compactness of their supply chain," said Proffitt.

"They will benefit from increased efficiencies, cost-cutting, better asset utilisation and out-of-stock reduction."