3PL News: Cougar to provide warehouse operations services for Danfoss

Jeff Berman, Senior Editor -- Logistics Management, 11/30/2007

SINGAPORE and SAN MATEO, Calif.—Cougar Express Logistics, a subsidiary of Menlo Worldwide, a third-party logistics (3PL) services provider owned by Con-way, said earlier this week it was awarded a three-year contract by the Danfoss Group to establish, deploy, and serve as its Asia-Pacific Central Distribution Center (CDC) warehouse operator in Singapore.

Danfoss is a global industrial group that focuses on research and development, and production for mechanical and electronic components for multiple sectors, according to a Menlo statement. Menlo said Danfoss’ CDC warehouse will serve as an Asia-Pacific warehousing and distribution hub for its worldwide suppliers and customers throughout the region.

This deal is an extension of existing business between Cougar and Danfoss, which was first established in early 2005, when Cougar responded to a request for proposal (RFP) and was awarded the contract to serve as Danfoss’ CDC operator in the Asia Pacific (APAC) region, according to a Menlo spokesperson. The two parties are currently in the process of finalizing the new contract, which is expected to commence in January 2008, the spokesperson added.

Lim Eng Leong, operations manager for Menlo/Cougar on the Danfoss account, told Logistics Management that logistics is a core competency for this CDC, because this is the hub which affects all Danfoss customers in the APAC region. 

And he added that Cougar will play a major role in helping these customers with their warehousing and fulfillment operations through its “flexibility-reliability” logistics concept for Danfoss, which aims to ensure customers are serviced with the fastest and most effective distribution services.

“This process focuses on providing productivity improvements, efficient layout design, process mapping and cost analysis, while incorporating quality standards within each phase of the implementation and ongoing operation,” said Eng Leong.

The "reliability-flexibility" concept, he noted, is written into the new contract, and its main focus is to proactively ensure that both Cougar and Danfoss can overcome peaks and seasonality on demand. The concept also will enable both parties to monitor staff capabilities and performance on regular basis.  This process has helped Cougar and Danfoss realize a 50 percent lead-time reduction in the warehouse services and daily status report, making it possible to proactively eliminate problems, said Eng Leong.

“In the end, this has also helped Danfoss to improve the delivery service to their customers,” he said.

Other benefits of this partnership for Danfoss cited by Eng Leong include: enhanced quality via re-engineering warehouse processes with quality standards; a well-planned warehouse layout that facilitates efficient processes and improved productivity; proper location control and labeling for product, improving fulfillment turnaround and general warehouse management; an integrated package of logistics management, storage, order processing and logistics coordination for Danfoss’ industrial products; and improved warehouse space optimization.

“We need a strong platform to execute our deliveries to our customers in APAC, therefore I am satisfied to continue our cooperation with Cougar as Cougar over time has proven its dedication to our business,” said Torben Christensen, Vice President of Danfoss' Global Logistics Service organization, in a statement. “Looking into the future we are, of course, curious to see what Menlo can add in to this cooperation. During the last 3-4 years, we have invited Menlo to participate in some of our global freight tenders. But until now we had not succeeded to close a contract with them, so we didn't know the company that well. The new contract is also a starting point for us to learn more about Menlo.”