I have been working in logistics at DMK for 30 years. At the same time, my family runs a dairy farm. Logistics and farms have to run 24/7. There is always something going on and every helping hand is needed.
If farmers don't get the conditions and resources they need to run their farms economically and produce high quality milk, it affects the whole supply chain, including our business. The supply chain begins with the collection of milk from our farmers. Our collaboration works like clockwork, all year round; the product is processed, stored, picked, delivered and the process starts all over again. This means working shifts, weekends and holidays. However, the holiday season, such as Christmas, presents a special challenge.
We collect the milk...
Milk collection lorry drivers collect milk from our farmers every day, whether it's a working day, weekend or public holiday.
People cook and bake more at Christmas. Retailers need more speciality produce such as cream, crème fraîche and cheese.
We estimate what the consumer is buying now, but even the retailer cannot tell us the exact quantity we need to deliver far in advance.
But we have to be prepared for storms, snow and ice, especially around Christmas. Roads are blocked, paths are impassable - this is when we benefit from good cooperation between milk collection lorry drivers and farmers. Sometimes a tractor can pull the lorry out of the snow and - hopefully - the journey can continue.
...deliver it to the DMK plant
In the weeks leading up to Christmas, we rely on having enough lorry drivers available. But many of them want to go on holiday, celebrate with their children or return to their home countries.
Similar to the situation on dairy farms, we need people in a dairy who are willing to work on days that are not so pleasant.
The general challenge is the availability of labour. Many areas are already highly automated, even some of the forklift lorries operate without drivers. This saves labour and money. This may sound strange at first, but as a company we have to use the technological advantages of our time to remain competitive. On the other hand, the ever-increasing shortage of young talent means that technological progress is also urgently needed.
It is now much harder to find people who are willing to take on the shift and weekend work of a lorry or warehouse driver. So we are very grateful to our employees and we show it. It is important to me to know how they are doing, whether some of them need special support because they have ideas or want to develop, or whether they just want to do their job and be paid fairly. For us, these people are the linchpin of our supply chain.
...use it to make products
To ensure we neither overproduce nor underproduce, we use our historical data to estimate the quantities our customers want. To better understand consumer behaviour, we use digital systems that we feed with new information from retailers and our sales throughout the year. This allows us to make forecasts.
We have to pre-produce in order to meet the increased demand from retailers at Christmas. Pre-production in turn leads to an increase in stock in the warehouses. Here we have to manage possible capacity bottlenecks in the fresh product warehouses.
...store them
This year, the holidays fall on a Wednesday and a Thursday. We now have to spread our customers' orders, which are normally scheduled for five weekdays, over three weekdays.
During these days, the volume of goods in our warehouses and those of our customers increases significantly.
The drivers pick up the produce from our warehouses, deliver it to the retailers, come back and pick up new goods. That's the usual chain. And then, of course, there can be complications. Disruptions in our warehouses or during transport to the customer, such as traffic jams or a snow disaster. It can also happen that we are not allowed to unload at the retailers' warehouses because they are full. This creates a lot of stress at all points in the supply chain.
Another challenge is that dairies create produce every day that needs to be stored. When sales are slow on many days due to the holiday schedule, capacity is quickly exhausted and our warehouses are almost overflowing. That's when we need to be creative and exhaust all possibilities, both internally through our sites and externally. However, thanks to our increasingly accurate forecasting, we have been able to avoid this in recent years.
...dispatch them
30 years ago, things were more complicated; there was still ultra-fresh milk, which at that time had an average shelf life of only eight days. The many small supermarkets were supplied directly because of the short shelf life of fresh milk. From a logistical point of view, delivery was a much bigger challenge because there were more customers and more routes. Close coordination with the authorities was necessary. Transport is not allowed on Sundays and public holidays without special permission. Sometimes produce was simply sold out in the supermarket. Forecasts for delivery quantities were mostly based on experience and gut feeling.
Today, everything is much more organised and efficient. Milk has a shelf life of 20 days and retailers have set up central warehouses where we deliver in larger quantities. Modern forecasting tools and new technology make our logistics much easier.
...load the lorries with our produce
To ensure that customers are supplied reliably and cost-effectively, it is very important to make the best possible use of the loading capacity of the lorries.
For fresh produce, which is generally light, we generally use double-decker lorries that are loaded on two levels. This allows us to achieve the optimum volume to weight ratio. We can now transport a load in two trips where previously we might have had to make three. Less fuel, less emissions. Our rule of thumb is that the more optimally we load the lorry, the more sustainable and resource-efficient it is.
...transport the products to the customer
The Christmas rush for long-life produce such as UHT cream and milk starts at the end of November. In the two weeks before Christmas and during Christmas week, the focus is on fresh produce. During these days, we have to coordinate the loading dates with our freight forwarders and the delivery dates with our retail partners very closely in order to move the large quantities of produce through the warehouses in a shorter period of time.
If the produce doesn't get here by the 51st week, it's game over. After that, business slows down. Customers go on holiday or eat out, but they don't cook as much as they used to.
So far, everything has worked well - although as a company we can always improve and we have not yet reached the end of the journey. After Christmas, the stress level drops significantly for all of us. We usually have a nice barbecue with the people who have been there for us over the holidays. It brings us together - and that's when we really get into the Christmas spirit.