Standardized fruit and vegetable reusable containers – the next intralogistical step for car e-logistics and e-food

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Published on: February 23, 2021 / update from: February 23, 2021 - Author: Konrad Wolfenstein

Standardized reusable containers – Image: GeometricNebula & Holos__8 & nehophoto & Victor Prilepa|Shutterstock.com

The market volume for fresh fruit and vegetables in Germany is €14.9 billion per year. The level of self-sufficiency in Germany with fruit is 22% and with vegetables 36%. In Germany, vegetables are grown outdoors by just under 6,000 farms and almost 1,700 farms under glass.

On the German food market, consumers buy almost half of all fruit and vegetable sales in discounters.

In addition to production, the processing of fruit and vegetables is an important sector of the economy and is considered a sub-sector of the food industry. It also includes the production of fruit and vegetable juices. Its approximately 250 companies employ more than 30,000 people and have a turnover of around eleven billion euros.

German consumers prefer shopping in the country's numerous food discounters. The discounter branch network is one of the largest in the German food trade.

The market shares in the food trade have been consistently distributed for the German market for years. The four big players Edeka, Rewe, the Schwarz Group (Lidl/Kaufland) and Aldi have a combined market share of around 70 percent.

Sales distribution of fruit and vegetables in food retail – Image: Xpert.Digital

Fruit and vegetables are not only a large sales market, they also contribute significantly to the image of freshness and quality.

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You can find out more about data research here in various compiled PDFs for download.

Why reusable containers?

CO2 savings and resource conservation through reusable transport packaging? Reusable containers save raw materials and help prevent environmental damage.

The year-round provision of fruit and vegetables requires a complex and extensive logistical infrastructure. Plastic, wooden and cardboard boxes are mainly used. Plastic boxes are used as reusable containers and cardboard boxes are used as disposable containers.

According to a study by the Fraunhofer Institute for Material Flow and Logistics (IML), cardboard boxes are 35 times (4.2%) more likely to suffer container damage (packaging breakage) than reusable containers (0.12%).

A reusable system based on plastic is not only economically and ecologically superior to the disposable cardboard containers, it is also the most economical form of logistical action with fruit and vegetables. This was the result of the study “Sustainability of packaging systems for fruit and vegetable transport in Europe- based on a life cycle analysis”. This was developed on behalf of the Initiative Foundation (SIM) 2009 by the Institute for holistic accounting. It is attached to the Fraunhofer Institute for Building Physics and the University of Stuttgart.

Why standardized?

Fruit and vegetables are some of the most complex cargo in logistics. They are highly sensitive, perish quickly and temperature-controlled. Cost pressure and compliance with quality requirements also play a very important role. Since almost 50% of fruit and vegetable sales already come from discounters, any form of further development in this important product group is of great interest. Be it in expanding market shares, increasing customer acceptance (image) or further developing the future market.

Any time savings from the supplier to the consumer is therefore very important. While our logistics from the first, middle and last mile are constantly developing, there is also a need for further development in the optimization of the supply chain.

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Last Mile Logistics – Facts you should know

Standardized reusable containers not only ensure quick and careful delivery, they can also be better digitized for logistical processes and the entire inventory can be controlled centrally.

Standardized reusable containers fully demonstrate their advantages in combination with a hub storage system in terms of speed, flexibility and organization.

Why hub system?

Whether head bearing or cross-docking. Strictly speaking, they are the same as the hub system used in micro-hubs in the field of micro-fulfillment. Micro-hubs are considered the key solution of the future for e-commerce and stationary retail in the network, the autonomous retail systems (ARS).

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As in a hub, from the English for hub or central contact point or main transshipment base, all fruit and vegetable products are delivered to a central location by the suppliers. From this central warehouse, the goods are distributed to the individual locations. This is intended to reduce transport routes and storage times.

This accelerated process makes better use of the freshness of fruit and vegetables because the goods reach the market more quickly. While large parts previously had to be kept in stock in the regional warehouses, this is now only necessary in a centrally controlled manner at the hub.

The advantages are apparent:

Lower lead times.
Timely delivery.
Better needs-based quantity and time planning.
The amount of fruit and vegetables kept in stock decreases (reduction in inventory), which helps improve quality, minimizes storage space and reduces storage costs.
Due to central data collection and a broader database, store-specific mixed pallets can be put together better to suit regional differences.
Central and comprehensive quality testing is now possible and reduces costs.
A separate run can be converted to reusable tanks. In further steps, suppliers can be “brought” to the standardized reusable containers until the separate run is only necessary for the change of container in exceptional cases. It is best to combine the quality check.
In this way, standardized reusable containers in the fruit and vegetable segment can be used to implement autonomous and automated control of the flow of goods. This leads to further cost reductions and time savings, which affects the quality and freshness of the goods. In addition, resources are conserved and packaging breakage is minimized.
In a further step, quality control and goods control can now be optimally accelerated using AI and RFID or similar techniques for fruit and vegetables.

In 2005, Lidl bundled its temperature-controlled goods in cross-docking warehouses. However, fruits and vegetables were not affected. In 2014, REWE put the first head warehouse for fruit and vegetables into operation in Leipzig.

What is Auto E-Logistics?

Logistics 4.0 is the basis of Industry 4.0. Logistics is not only the backbone of industry and key industries, but also for trade and therefore works in an interdisciplinary manner. What characterizes Logistics 4.0 is the speed and flexibility in collecting and providing data and implementing it in the results.

With non-food, logistics in the area of e-business and e-commerce has achieved a breathtaking development. Digital platforms such as Amazon are the big winners of this development.

Auto e-logistics does not mean e-car trading.

E-logistics describes the planning, solution and control of logistical tasks using the Internet and other information and communication systems and is part of electronic commerce.

The technical and organizational requirements for implementing e-logistics are:

The integration of internet-based systems into the existing IT systems.
The further development of organizational procedures and processes.
Focusing on overcoming information barriers of the individual partners in the value chain.
A realistic assessment and evaluation of the complexity of integrating e-logistics solutions.
Willingness to collaborate across companies.

Auto e-logistics is the expanded form of autonomous and automated e-logistics. From the autonomous partial control of certain areas and processes using AI to the full automation of logistics.

The important connection between logistics/intralogistics and omni-channel commerce has been pointed out for a long time. The best e-commerce trade is of no use if the logistics don't work properly. Likewise vice versa. Auto e-logistics is an intermediate step from the collection and standardization of data and the automation of important logistical steps to unified commerce, also known as no-line commerce.

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Well equipped for no-line commerce

E-Food

"With large market shares alone, the big freshly logisticians can no longer secure the business," said a logistics expert in 2004 the changes in the food retail trade.

2004 was also the year of UMTS, the third generation of mobile communications (3G), the precursor to LTE (4G) and 5G. E-commerce was still in its infancy.

The development of e-commerce can best be seen in Amazon's sales development. While Amazon had sales of $6.02 billion in 2004, 16 years later it had increased 56 times.

Amazon's worldwide sales from 2004 to 2020 - Image: Xpert.Digital

“With large market shares”, the food retail trade can no longer secure business ”, so you have to interpret the numbers from the large e-commerce providers, which, like once in 2004, tackle the e-food sector in the e-commerce market.

E-food is, so to speak, the last blank spot on the map of digital platforms and, so to speak, the supreme discipline of online trading. The market for fruit and vegetables in particular, where almost 50% of the market is in the hands of discounters, has become the focus of e-commerce.

For example, the e-commerce market for consumer electronics has initially been decided in favor of Amazon. Amazon is already ahead in the food and drugstore segment. Amazon is already 3.6 times ahead of shop.rewe.de.