Initiatives in Logistics Logistics in the food industry faces many challenges, including a shortage of truck drivers, rising distribution costs, and environmental issues such as the need to reduce CO2 emissions. The Ajinomoto Group is reducing its environmental impacts, from raw material procurement to product delivery. To reduce transport-related CO2 emissions, the Group is taking proactive measures, including boosting efficiency of delivery systems and pursuing modal shift and eco-driving. Initiatives as a consignor Japan’s revised Act on the Rational Use of Energy obliged specified consignors to CO2 emissions per unit of sales reduce CO2 emissions from transport and delivery by at least 5% on a per-unit basis within five years of fiscal 2006. This applied to Ajinomoto Co., Inc. and Ajinomoto Frozen Foods Co., Inc. CO2 emissions per unit of sales = Energy used/Weight of products sold 55 In fiscal 2015, CO2 emissions per unit of sales from transport and delivery declined 50.1 50.5 2.4% year on year, to 9.2% less than in fiscal 2010. This achievement was due to 45 48.7 50.9 46.6 improved efficiency in distribution and the following actions the company took to man- 45.5 age risk. Learning from the Great East Japan Earthquake, the company set up two 0 primary distribution centers—one in the northern Kanto region and one in the Kansai region—instead of relying on just one site in Kawasaki, as before. It adjusted its nation- 2010 2011 2012 2013 2014 2015 (Fiscal year) CO2 emissions per unit of sales during transport and delivery wide distribution network to accommodate these changes. 9.2% decrease Going forward, the Ajinomoto Group expects to continue to meet the legal requirement of a 1% annual reduction. (compared to fiscal 2010) Modal shift by Ajinomoto Co., Inc. Modal shift1 efforts in the Ajinomoto Group began in 1995, spearheaded by Ajinomoto Co., Inc.’s Logistics Planning Department and AJINOMOTO LOGISTICS CORPORATION. The Super Green Logistics Plan of Ajinomoto Co., Inc. is currently being imple- Modal shift percentage of Ajinomoto Co., Inc. FY2015 results (food products category) Overall 500 km or more (rail 23%, ship 26%) (rail 29%, ship 46%) mented to simultaneously strengthen transport capacity and make distribution environmentally responsible. Distribution is being overhauled to address the chronic shortage of long-distance truck drivers and the drop in transport efficiency caused by 49% 75% the shift to the Dual Mother Distribution Center system. Until 2012, only rail transport was used for distances of 500 km or more, but the use of ship transport is now being increased. Ships are now used to transport products from Kanto to Hokkaido, Kansai to Kyushu, and Kawasaki to Kansai. Meanwhile, rail transport has been enhanced by utilizing large and efficient 31-foot containers. In fiscal 2015, the modal shift percentage of Ajinomoto Co., Inc. was 75%. Efforts to increase this percentage are ongoing, with a target of reaching 87% by the end of fiscal 2016. Cargo ferry used in ship transport 1 Changing to modes of transport with lower environmental impact, including rail and ship transport. Railway container and ship transport produce one-eighth and one-fifth of the CO2 emissions of trucking, respectively. Relay Liner®: Better work environment for drivers and transport efficiency The Ajinomoto Group is addressing the improvement of work conditions for long-distance truck drivers. Main issues include irregular work arrangements, the need to sleep in the truck, and long working hours. In August 2015, AJINOMOTO LOGISTICS CORPORATION started using the Relay Liner®, which allows drivers from the Mie and Kuki Distribution Centers same-day return by exchanging entire loaded trailers at a midpoint Shizuoka. Relay point, Shizuoka Mie ® Relay Liner Same day return Kuki Same day return Specially-designed trailer Relay Liner® Loads 1.5 times the pallets of a regular truck (16 pallets increased to 24) Relay Liner ® is exchanged and each driver returns back to starting point Ajinomoto Group Sustainability Data Book 2016 The Environment 22 98 Initiatives in Logistics TOPICS Collaborating to create “F-LINE”1 food company distribution platform Six Japanese food manufacturers (Ajinomoto Co., Inc., Kagome Co., Ltd., The Nisshin OilliO Group, Ltd., Nisshin Foods Inc., House Foods Group Inc., Mizkan Co., Ltd.) reached an agreement in February 2015 to establish the “F-LINE” food company distribution platform. To achieve sustainable logistics, six companies have discussed (1) collaborative shipping among the six companies, (2) redesigning their main routes for medium and long-distance transport, and (3) standardizing logistics systems. 1 Food Logistics Intelligent Network ix companies’ collaborative shipping and standardized S logistics systems In April 2016, the six companies started joint shipping (for non-refrigerated products) in Hokkaido. To improve transport efficiency, they combined four shipping centers into two to share their storage and delivery trucks. The platform called “F-LINE” has decreased CO2 emissions by about 16% (during the period May to July 2016). Also, the companies are linking up their systems and centralizing logistics information for joint shipping to standardize and boost efficiency of their logistics functions, including inventory AJINOMOTO LOGISTICS CORPORATION's Sapporo Distribution Center in Hokkaido control and delivery trucks allocation. This reduces the number of deliveries than before when multiple companies were delivering products individually as well as the amount of receiving work on the receiving side, leading to greater overall efficiency across the supply chain. Cooperation on backhauling to reduce CO2 emissions In March 2016, Ajinomoto Co., Inc. and Mizkan Co., Ltd. launched joint use of rail for two-way medium and long-distance transport between the Kanto and Kansai regions. Previously, both Standardized shipping documents for “F-LINE.” AGF is gradually introducing same system in Hokkaido companies used rail and truck to transport product inventories carrying loads only in one direction. Ajinomoto now sends its products on the outward shipment, and Mizkan uses the return container to transport its products. Both companies have reduced trash, and increased the total modal shift percentage on this route from 10% to 40%, reducing CO2 emissions by about 20% (March to July 2016). Two 31-foot containers (one is owned by AJINOMOTO LOGISTICS CORPORATION) are reused for one return trip each day. Rail Liner® 31-foot container for rail shipments Integrated folding wing design speeds up loading by allowing open access for full length Freight transport system Ajinomoto West Japan distribution center (Hyogo) ❹ Ajinomoto products ❺ Repositioning Ajinomoto Kuki distribution center (Saitama) ❶ Ajinomoto products Ajinomoto products JR Osaka freight terminal station ❸ Rail transport JR Ajikawaguchi terminal station ❼ Rail transport ❻ Mizkan products Mizkan Kansai No. 2 distribution center (Hyogo) Ajinomoto Group Sustainability Data Book 2016 Mizkan products JR Utsunomiya freight terminal station ❷ Loading center (Tochigi) ❽ Mizkan products ❾ Repositioning Mizkan Kanto distribution center (Tochigi) The Environment 23 99
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