The new model for local food distribution in Northern Ontario

Located just outside Sudbury in Northern Ontario, Click Fork, an innovative new food hub is serving their community with fresh, local food in a place where it can be difficult to access. Click Fork is composed of three farms: Dalew Farms, Field Good Farms and Kipling Ridge Farms, and they sell a variety of products, including beef, poultry, produce, and grains!

Chantal and her family at Dalew Farms!

One door closes…

The farmers first met each other more than 10 years ago when they were supplying a local retail store, Eat Local Sudbury. The store provided a sales channel for nearby farmers to sell their products. The store was crucially important for the Sudbury community as it provided a central access point for fresh, local food. In Northern Ontario, access to local food is not always easy, since the farmland and urban areas are so spread out, making logistics expensive.

Unfortunately, in March 2018, Eat Local Sudbury closed its doors. With the loss of an important sales channel, the farmers began looking for a new alternative that would allow them to sell their complimentary products to a wide audience, in a way that worked for their individual businesses.

Isabelle, Ryan and their daughter at Field Good Farms!

Another one opens!

After several meetings, Chantal from Dalew Farms suggested providing their customers with an online platform after having success with her own Local Line store for her individual customers. She wanted a one-stop shop, where everyone’s customers would be able to shop and order their favourite products direct from the farmers – online. After connecting with Local Line founder, Cole, and discussing options, this became a reality. Click Fork, the online food hub, was born!

James and his family at Kipling Ridge Farms!

Oh, just check us out – online!

Since launching their online store, Click Fork has been a growing success. The online store allows customers to browse through products, sort by product type and by farmers, and then order from whoever they want! Additionally, the platform allows the hub to track all incoming orders, send invoices, generate picklists, and plan weekly distribution! Customer newsletters and pick up scheduling have all become automatic, which collectively saves the farmers hours of work each week.

Chantal from Dalew Farms says

“The logistics of a food hub are tricky! Everyone plays a different role in the operation of Click Fork. We all have our strengths, so it’s really great that the online platform gives everyone access to the tools they need to carry out their roles.”

Looking back, since Click Fork launched in July 2018, the online hub has accomplished its goal of providing a new sales channel to the farmers (they have over 250 customers!), and increasing access to local food for Sudbury residents. The farms are no longer limited by the number of customers that would physically shop at the Eat Local Sudbury store, and have been able to reach new audiences.

Moving forward

After a successful first year, the goal for Click Fork’s future is to increase available inventory and continue to grow their customer base. They also hope to increase the variety of products to service a larger diversity of shoppers.

“People say farmers are behind, but that’s not true. We’re right there with them – online!” – Chantal, Dalew Farms


We are so happy we were able to host the first online food hub in the area and play a role increasing access to local food in the Northern Ontario region. Want to learn more? Check out Click Fork for yourself!

How to make your delivery experience more memorable for your customers

The last step to making an online purchase is receiving the product. Unboxing can be very exciting. The moment a customer opens their package, it should feel the same as opening a present. To help you make that experience memorable for all your customers, here are our tips for a great delivery experience:

Delivery confirmation

After an order has been made and approved, you should confirm with your customers that it’s coming their way! A simple confirmation email or call with the estimated date and time of arrival puts confidence in your customer that their order is of importance and will be with them soon. This is a simple step, but effective.

Branding, branding and more branding

Your branding should be on everything that comes from your business. Your packaging should reflect that. Whether you use personalized boxes or have a business card inside the package, it should be clear. Uniform branding appears professional, looks great, and encourages brand recognition.

Add free samples or small gifts

This is a great way to get more out of your customers. In another blog post, we talk about the law of reciprocity – where when someone is given a free gift, they feel inclined to return the favour. In e-commerce terms, purchase a product. Adding a free sample could increase the chances of repurchase. In addition to this, free samples also give your customers a taste into what else you sell. If you recently launched a new product, add it to get more exposure. Free samples or gifts look great to a customer and can be an effective method of marketing. If samples are not feasible for your business, consider adding a discount code or coupon for their next order. This will promote repurchase and is a little easier to manage.

Write a thank you card or personal note

Food is personal, so make it personal! Take the time to write a personal note or a thank you card to a first time customer. Go a step further. Add an information card about the history behind your product or your farm. This is a great way to connect with a customer and get them hooked.

Friendly and memorable interactions

In this blog post on how to keep your current customers, the last tip is to put a face to the brand. This is an essential aspect of delivery. The interaction between customer and distributor should not be ignored. If you do your own deliveries, be organized, on time and most importantly friendly! Remember your customers names, and their orders. Customer service is an important tool and should be considered in your delivery planning. If you are using a shipping partner, be sure to use a partner that will represent your brand. Even if you did not do the delivery, the customer will associate any experience with your business. For tips on how to get started with a shipping partner and the right questions to ask, check out this blog post.

Follow up!

After a delivery has been made, the last step is to follow up. Send an email. It’s important to get feedback on the delivery and products received. If they weren’t happy you get the chance to address it before they reach out to you or even worse, become a lost customer. Add a reorder option to encourage repurchase!


Following all of these steps will help you create a delivery experience that will be memorable to your customers and help you increase the chances of reorder and referrals. Distribution can be a pain point for a lot of food suppliers. To further help you create a delivery plan that is profitable, check out this blog post.

How to save on shipping costs as a small food supplier

It’s not a secret that distribution is a pain point for a lot of food suppliers. Shipping is very expensive. To make it a little easier on you, here are some ways to save on shipping costs to get your products to your customers:

Pack small and light

The first step is to think about what you are shipping. Often, the actual packaging of the products can be bulky and heavy. This takes up more room in a vehicle and can lead to higher costs if shipping with a third party distributor. To avoid this, start by measuring your current products and then determining the average daily/weekly orders. This will help you determine the space currently used in a vehicle to get your products to your customers and if this needs to be reduced. You should only be using space that needs to be used and buy packaging that fits your products.

Determine and use your MOV

This is a popular but essential topic. A minimum order value is the lowest dollar value that you will ship to your customers. Using our calculator, you can determine how to guarantee a minimum profit per order. This calculator breaks down the cost on the road, margins and break even point, target profit, and average deliveries per hour to determine your business’ unique MOV. After determining your MOV, implement it! Only offer delivery to customers who meet that bracket, otherwise you will be taking a loss.

Be strategic with your shipping area

You’ve thought about your packaging and the minimum order for delivery – however, you must also determining the limits to where you are delivering. A MOV ensures profit for delivery, but it does not consider the shipping area. Your shipping area must be feasible with your resources while also considering the needs of your customers. To determine the best shipping area for your business, compile a list of where your customers are located and choose the most frequent.

Tip: If you are just starting out with delivery, start small. Service in our own area first. Build up a customer base and then consider expanding to different cities. You want to make sure you are running a profitable business before running the risk of shipping to a larger area.

Don’t work with only one carrier

If you don’t have the resources or time to deliver your own products, consider using a shipping partner. This blog post outlines all you need to know when determining whether to do this. If you do work with a carrier, do not only use one. Different carriers have different costs for residential vs. post office deliveries. Use a few different carriers for different orders and compare and contrast. This may seem more time consuming, however it increases the chance of getting the best deal. Also, don’t forget the power of negotiation! Use competitive pricing to get the price you want.

Co-deliver

Co-delivery is a great option for saving on shipping costs. Co-delivery is the coordination of vehicle distribution routes from different suppliers to bring products to their buyers. Essentially, it is connecting two suppliers that need to distribute their products to the same location, however do not have the capacity to do it alone. It can save you money, increase your shipping area, fill capacity and even reduce emissions from your distribution route! To learn more on how it helped these three farmers save time and money on their distribution, click here

Backhauling

Backhauling is the carrying of goods on return trips. An example of this is delivering a product from your farm to Toronto and then collecting products from suppliers located in Toronto and bringing them to the region where your farm is located in. This prevents empty vehicles from returning to their original location and aiding other suppliers that require transportation. Backhauling allows for profit from the return trip. This can be combined with co-delivery to help you save money.

Pick up locations

If door-to-door delivery is not feasible for your business, or you’re looking to decrease current costs, consider pick up locations! Pick up locations allow you to bring your products a little closer to your customers and a lot closer to you. Instead of having to make 8 deliveries in one day, you could possibly cut it back to 1 or 2! In addition to reducing costs, pick up locations can also help you promote your business by having locations in busy customer hotspots such as farmers’ markets, gyms, schools or community centers. To learn exactly how pick up locations can save your business money, check out this post


We all want to save money in our businesses. Don’t lose money by trying to get your products to your customers. The last tip to success is having a way to properly manage, track, and communicate your distribution. Put it all in one place. 

Looking for a shipping partner for your food supply business? Consider this…

Offering delivery services to your customers can be advantageous. Depending on the current status of your business, delivery comes in many different forms, such as farm pickup, pickup locations, co-delivery and direct delivery. If you are looking to offer direct delivery to your business, however do not have the resources or time to deliver yourself, partnering with a shipping partner could be an option. Here is all you need to know about getting started with a shipping partner:

What is a shipping partner?

A shipping partner or third party logistics provider is a service that receives, holds and transports a product from producer to consumer.

Some advantages include:

  • Date management
  • Temperature-controlled warehousing and travel
  • Co-delivery or co-loading with other food suppliers to reduce costs and fuel
  • Saves you time from delivering yourself, and
  • They have plenty of delivery experience

There are disadvantages too that include:

  • Customer responsibility – If the customer is not there to collect the delivery – the package will be returned to you. Within the food industry, this can be a huge problem. Due to the fragility and time concern with food, there is a possibility that when the product is returned to you, it will be lost stock.  Note: This is dependent entirely on your type of product (preserved vs. fresh product).
  • Expensive set up and usage fees – There are many upfront costs associated with setting up services with a shipping partner which can be a large investment in the short term. 
  • Out of your hands – In regards to customer service and accountability, the delivery protocol is out of your hands. If a bad experience occurs with the shipping partner, it reflects poorly on your business.

How do I know it’s right for me?

Ask yourself this:

  1. What is your current distribution plan?
    • What are your customers asking for? Have you considered starting with pickup locations? Determine whether offering delivery is the right step for your business financially at this time.
  2. Are you fulfilling more than 10-20 orders a day?
    • If yes, then you might want to consider partnering with an expert who can save you time.  Dependent on your margins and still ensuring profit, it might be beneficial for someone else to take the load off of you.
  3. Is your business growing or about to spike?
    • If this is the case, perhaps your current distribution methods will not be able to keep up.

How do I find the right one?

If working with a shipping partner is feasible for your business, how do I find the best one? Here are some good questions to get you started:

    1. Do they have an enforced non-disclosure agreement (NDA)?
    2. What are their hours of operation? Do they ship on weekends and holidays?
    3. Do they have at least a two-year track record of financial stability they’re willing to share documentation regarding?
    4. What is their capacity? Are they able to meet your delivery demands?
    5. Are they located in high-demand areas for your business? Do they have to travel far to get to you/your customers?
    6. Do they have good customer references from customers similar to your business?
    7. Do they have experience shipping food products?
    8. Can they provide necessary documentation regarding food and health safety standards? Are they temperature-controlled if necessary?
    9. How do they compensate for delays in delivery?
    10. Can they handle unexpected spikes in delivery demand?
    11. What is the communication strategy in regards to orders, shipping notices, receiving and adjusting notifications?
    12. What costs are included in their quote:
      Transportation costs – the cost of picking up the product from you
      Shipping costs – the actual cost of shipping your product to the customer
      Return costs – the cost if a product is returned from a customer to you
      Minimum costs – this the minimum cost of using the service. This is important to note when having a slow month.

If deciding to work with a shipping partner, talk to them! Be sure to get answers to the important questions. You don’t want a partner that doesn’t work for your business and be left with unfulfilled orders, unhappy customers, and lost sales.

A common mistake made is jumping into business without proper research. Do your homework! Working with a shipping partner can help your business, however only if done correctly. 


If working with a shipping partner doesn’t sound feasible for your business, consider other options for distribution, such as setting up pickup locations and co-delivery.

How do I calculate hourly delivery costs?

Delivery costs can be very expensive and hard to track. When first starting to offer delivery in your business, it is important to calculate the costs of being on the road to ensure it’s profitable to you to offer that service to your customers.

Here are 6 steps to calculate hourly delivery costs:

Step 1: Determine time on the road

The first step is to calculate how many hours the vehicle is on the road on a daily basis. For example, on any given delivery day, the truck is on the road for 6 hours and deliveries are made on Mondays, Thursdays and Saturdays (three times a week). 6×3=18 hours per week.

Step 2: Cost of driver

This is dependent on the cost of your specific driver, whether that is you personally or a third party. For this example, let’s say the cost of the driver is $30/hour.

Step 3: Cost of gas

Cost of gas can be a tricky variable to determine. The best way to determine the cost of gas is to fill up the transportation vehicle fully with gas at the beginning of a delivery day, note the cost, and at the end of the day calculate the cost of the gas used for that day. For example, the cost to fill up the vehicle completely was $100. At the end of the day, ¾ of the tank had been used; therefore the cost of the fuel used was $75 ($100 x 75% = $75). The vehicle was on the road for 6 hours. The cost of gas per hour would be $12.50 ($75/6 hours = $12.50).

Note: this is an approximation of the cost of gas and may vary based on traffic, or route changes.

Step 4: Determine hourly insurance cost

What is your annual insurance cost? Take that number and divide by 12 months to determine monthly cost. To determine hourly cost, divide the cost of insurance monthly by the number of hours driven in a month.

For example, let’s say the annual insurance cost is $3,000.

The monthly insurance cost would be $250 ($3,000/12 months = $250).

The number of hours driven in a month for this vehicle is 72 hours (3 days/wk x 4 wks = 12 days a mth; 12 days x 6 hrs = 72 hrs/mth).

The hourly rate for insurance would be $3.47 ($250/mth / 72 hours/month = $3.47).

Step 5: Determine hourly cost of depreciation

Determine the percent of depreciation per year for your vehicle. We recommend applying at least a 15% depreciation on the value of a vehicle per year, however it can be dependent on each case. To determine annual depreciation value, multiply the value of your vehicle if you were to sell it today by the annual depreciation percentage. To determine monthly depreciation divide the annual depreciation by 12 months. To determine hourly depreciation, divide the monthly depreciation by the number of hours driven each month.

For our example, the value of our vehicle today is $50,000.

With an annual depreciation of %15, the annual depreciation value would be $7,500. ($50,000 x 15% = $7,500).

The hourly depreciation would on the vehicle would be $8.68. ($7,500/12 mths = $625; $625/72 hrs = $8.68).

Step 6: Total hourly delivery costs

The final step to calculate hourly delivery costs is to sum every step. The hourly delivery cost for our example would be $54.65.

($30 for cost of driver + $12.50 for cost of gas + $3.47 for cost of insurance + $8.68 for cost of depreciation = $54.65/hour)


Looking to determine the minimum order value (MOV) to make those hourly delivery costs worth it? We have a straight forward calculator for that. Fill out the form below to request a free copy!

Implementing successful (and profitable) co-delivery in livestock farming

As we have been discussing, in the earlier parts to this co-delivery series, as a food supplier, your most important cost is distribution. It’s the difference between a profitable and unprofitable operation.

In part one of this series, we talked about the importance of co-delivery and why it needs to be implemented and in part two, we looked at the parameters of shipping food and how to properly implement co-delivery into your business.


As a small supplier, you can’t do it all yourself, and sometimes you get caught between a rock and a hard place. You know you need new customers to grow your business, BUT shipping to new customers is so expensive!

So, how do you find the right balance and keep a healthy margin?

Last year, three Local Line suppliers were all working on their own independent distribution plans: Vibrant Farms, Arrowhead Meats and 5 Chicks and A Farmer. Once they connected through the Local Line marketplace, they were able to combine delivery routes, increase efficiency, dramatically lower distribution costs, and ship to new customers.

What does it look like for them?

Shipping company – Arrowhead Meats

Shipping frequency – Every other Saturday

Transportation – Non-refrigerated delivery truck

Pricing – Farms are billed after delivery by Arrowhead Meats (shipping company) for their orders based on weight and size of boxes.

Conditions – The customers must be home to accept the delivery.

Schedule

Thursday:

6:00-8:00 PM – All orders for shipping need to be in to Arrowhead Meats

Friday:

6:00-8:00 PM – Customers are given delivery schedule to ensure they are present for delivery.

Saturday:

5:00 AM – All products are taken out of the freezer and put into insulated packs.

7:00 AM Arrowhead Meats truck hits the road from Listowel, ON. Picks up orders from Vibrant Farms and 5 Chicks and a Farmer, just outside of Waterloo, ON.

7:30 AM – Delivery starts for the day making customer stops in Hamilton, Oakville, Toronto, and Markham before turning around and heading back to Arrowhead Meats.

A successful co-delivery system is based on an understanding between farmer, driver, and customer. When communication is frequent and expectations are clear and realistic, you can create a well-oiled co-delivery machine!

What have been the benefits of co-delivery to their businesses?

“Co-delivery makes our distribution more efficient. If we can get the truck as full as possible for the driver, we can deliver to more locations and everyone wins.” Luke, Arrowhead Meats

Efficient distribution

The new co-delivery program allowed Arrowhead Meats to fill their truck. Sounds simple but this is not always the case for farms. Often transport vehicles are left 50% empty; therefore transporting the products of other local food suppliers allows Arrowhead Meats to be methodical when delivering. Co-delivering also allows the driver to hit as many locations on one route.  The route optimization tool in the Local Line platform ensures they see decreased fuel costs and more efficient schedules for their drivers.

Reach more customers

The ability to provide shipping to a larger area due to co-delivery, allows 5 Chicks and A Farmer and Vibrant Farms reach a larger customer base as Arrowhead Meats already provided shipping to the GTA.

“Co-delivery has allowed us to reach more customers. We didn’t have the staff to be able to offer delivery services, therefore having the ability to share the cost is very helpful.”  Kathryn, Vibrant Farms

Ensuring PRODUCT quality control

This form of distribution allows you to work with people who know the industry. When using an outside distributor, sometimes they are unaware of how to properly store your products and how to manage direct to customer deliveries. If you’re not careful, this can lead to lost product. Luke from Arrowhead Meats explained that he once used an outside distributor, and at the end of the day the meat was returned to the farm barely covered in plastic and completely un-thawed because a customer was not there to answer.

What are the challenges of implementing co-delivery?

1. Temperature controls

When co-delivering meat products, you must maintain a consistent temperature during transportation. This can be a challenge on hot summer days, especially if each farmer is delivering to different customers. Each stop adds up, so you need to monitor your products condition carefully. That said, it doesn’t have to be complicated. Arrowhead Meats simply ships the products already frozen, and packages them with insulated boxes.

2. Insufficient orders

The challenge for Vibrant Farms and 5 Chicks and A Farmer is ensuring that enough orders are placed during each order period to make shipping financially feasible. The fewer the orders being shipped, the more expensive it is to ship per box. To help them with this, they followed some tips on how to increase your order intakes.

Any tips for farmers and food suppliers looking to start co-delivering?

  • Start small – This allows you to scale your business and make sure the key things are working. Start with one vehicle and less frequent delivery trips. See how that goes and think about growing.
  • Work with like-minded people/businesses – Working with farmers nearby who deliver similar type products will allow for the best partnerships. The people you are working with will understand the challenges of shipping your product and will make doing business easier.
  • Consider parameters of food shipping – Always keep in mind the three parameters of shipping food products: timeframe for optimal freshness, temperature control, and compatibility of shipping partners.
  • Beginner? Find a farmer that is already shipping – If you are just starting out to offer delivery for your business, look for a farm that has been shipping for a while and see if you can add your products to their vehicle. Delivery takes a lot of time, and requires employees to be able to execute; therefore use your time more effectively at the beginning.

For Arrowhead Meats, Vibrant Farms, and 5 Chicks and A Farmer, their businesses are much better off now that they’ve found each other! This kind of partnership allows for local food to reach more customers and make it more feasible for food producers to do so.

How to plan your delivery schedule to maximize profit

Offering delivery services to your customers is advantageous to growing your business, however you must find the balance between happy customers and a happy business.

We’re here to help, here are 6 steps to help your business plan a delivery schedule that helps to maximize profit:

Re-assess your current logistics plan

The first step to maximizing profit is to dissect your current distribution plan. How often are you delivering product and what is the profit per delivery or are you losing money on delivery? What is functional and what is not? If you create an overview of current operations, it is easy to point out which areas need improvement. If you currently do not offer deliveries, you need to determine your distribution capacity.

Determine your distribution capacity

It’s time to take it from the top. Consider the region you can reach, the frequency per week you can delivery and size of order you are able to transport and create a plan that outlines these actions. Before considering what your customers want, consider what you are able to provide.

Consider the needs of your customers

Consider what types of customers you have. Should you offer delivery to all customers? Where are your customers and where are potential other customers? If you plan your delivery schedules around the needs of your customers and your distribution capacity, it will help you to profit from deliveries.

Set a minimum order value that increases profit

Minimum order value (MOV) is the lowest dollar value that you will ship to your customers. This blog post explains how to calculate this value for your product. Set your order minimum value to increase your profit. This will ensure that you are getting a profit for providing direct-delivery.

Implement pick up locations

Pick up locations are a great way to service multiple customers at once. In another blog post, we broke down how pick up locations can save you money on deliveries. Use the blog post to determine if pickup locations are an option for you.

Co-deliver

Co-delivery is the coordination of vehicle distribution routes from different suppliers to bring products to their buyers. It allows you increase your shipping area, saves you money per delivery, fills your loading capacity, and helps to reduce emissions from your distribution route. If co-delivery interests you, this blog post outlines how to implement it in your distribution plan.

How do I find and set up the right pickup locations?

If you have never heard of pickup locations or are questioning why pickup locations are important for your business, read our previous blog explaining how pickup locations can help save you money.


Pickup locations can save you money, however it important that you find the perfect location for your business. This can be a difficult process, so we have created a six step process for helping you find the perfect pickup location:

1. Look at where the majority of your orders need to go

The first step when determining where to have a pickup location is determining where your customers are. By taking into account where the orders need to go, you will pick a location that is feasible for your customers. If you currently do not offer a delivery service and are unaware of where your customers are coming from, ask. Reach out to current customers and ask them if they would benefit from a pickup location and where that location should be.

2. Determine your area

Determine the area in which you can deliver your product. Do you have the capacity to deliver to multiple cities or are you only able to stay within your region? Creating a realistic plan on where you can deliver to, allows you to pick locations that are manageable in the long run.

3. Decide what kind of pickup location would work for your business

Think about what type of product you sell and where that would fit best. Would it make sense to sell my product in a retail store, restaurant or warehouse? Do they have the capacity to store my product temporarily? What type of customers do I have and where would they prefer to visit? For example, for a restaurant or retailer picking up large orders, it would make sense for them to pick up their orders at a warehouse, however a customer ordering one or two products would not pick up an order from a warehouse and would probably want to pick up at a local school or church.

4. Scan the region for possible fits

Do some research and look at what retail stores, restaurants and warehouses are available to you in your distribution area. What do they currently sell at these places? Would having your product available for pickup at their locations be beneficial to them?

5. Connect and make a plan

Reach out to possible pickup locations and make an arrangement with them. Consider what the cost of the location will be per pick up. Will the location be dealing with the customers who are picking up or will you be at the pickup location dealing directly with customers? Where will you be stationed? How many pickups will you be having each week? Create a clear plan with the pickup location to avoid future confusion with customers.

6. Reassess and re-evaluate

After a few weeks/months of using the pickup location, reassess if this is working for your business, customers and for the owners of the pickup location. It is important that the service is functional for all members to avoid tension in the future. If the pickup location is not efficient, start back at step 1.

Once, you have one pickup location that is functional, consider finding more. The more pickup locations added to your distribution plan, the more money you will be able to make and save.

Can pickup locations make my distribution cheaper?

It can be very daunting to produce, market and deliver products. Many food suppliers find that they do not have the resources to be able to expand their delivery area, meanwhile trying to maintain other aspects of their business. Often, it is very time consuming and difficult to coordinate a number of small deliveries within a week and that there is often a gap between supplier and buyer when it comes to delivery frequencies, minimum orders, and fees. If you’re concerned that your orders are too small to be doing direct delivery, you might want to look into establishing pickup locations!

A pick up location is a predetermined area where a buyer is able to go to collect the items they have purchased from your business. A pick up location could include a store, warehouse, or restaurant. These locations can be inside or outside of your current delivery zones dependent on your capacity. Introduction of pick up locations also allow you to be able to sell your product in multiple locations and serve multiple customers from one physical location. It can broaden your distribution area by reducing the amount of deliveries per certain region.

When determining what types of distribution are best for your business, it is important to determine which types are feasible for you. Direct delivery is a good service to be able to offer your customer-base, it is not always an option for everyone.

Here are four steps in deciding if direct deliveries are feasible for you:

1. Determine your distribution needs

This step is relevant to determine what your direct delivery capacity is and the frequency required for delivery. Do my customers specifically need direct delivery? How many of customers want direct delivery? Can I offer this service? Determining your logistics is important when understanding what the best distribution will be your for your business.

2. Calculate your minimum order value (MOV)

Calculating a MOV allows you to be able to determine what the minimum order needs to be, while also ensuring that the cost of distributing your product is not too high. We have posted a previous blog post that outlines how to do this for your business. In this blog post, we used the example of the cost on the road to be 80$/h, which resulted in the order minimum for that business to be $213 per customer. This value took into account a margin of 25% and the capacity of making 3 deliveries in an hour.

3. Is my minimum order value feasible for shipping to my customer base?

Determining feasibility for shipping to your customer base is dependent on who your customers are. For example, if the MOV of a business is $213 per order and the main customer base are restaurants who make an average order of $600; the MOV is very appropriate. However, if the customer base are households who make an average order of $60, the MOV is unsuitable.

4. Are deliveries feasible?

Ask yourself, does it make sense for my business to provide door-to-door shipping for buyers based on my MOV?

If direct delivery is not an option for you, it is very efficient to have fewer delivery points and to have your customers to come to you. A pick up location brings the product a little closer to them, but also is a lot closer to you. This will reduce your transportation costs significantly and free up time that was currently used for direct deliveries.


So, how do pickup locations save me money?

Let’s use the sample business model from the MOV blog. Just to refresh, these are our numbers:

  • The cost on the road is 80$/h
  • The breakeven point is $320
  • The target net profit is $80
  • The truck is able to make 3 direct deliveries in an hour
  • The minimum order quantity (MOQ) is $640

Therefore, based on the model, your business would make 24 deliveries in a day (3 deliveries/h x 8 hours = 24 deliveries/8h) with an MOQ of $5120 and a net profit of $640/day. If at one pick up location, you were able to deliver two customer orders, you would be able to make 6 deliveries per hour instead of 3. This would reduce your time on the road by 50%, saving you $320 per day (4 hours x $80/h = $320 saved).

The amount of money you saved is entirely dependent on your business and transportation plan, however it is evident that by introducing pickup locations you have the ability to service multiple customers in one place. The example used above only delivered two customer orders per pick up location, yet this can be scaled up to your capacity and allow you to service many more customers.


If you’d like to calculate your own MOV with our MOV Calculator to determine your capacity for pickup locations, enter your email address below and we’ll email you a copy immediately!

How does Co-delivery fit into local food distribution?

Food distribution is a unlike any other form of distribution. There are many different parameters differentiating the transportation of food product from A to B from other types of product delivery. Co-delivery is an exciting concept that has been used in the shipping industry through different platforms such as, UShip, however needs to be modified in order to fit the needs of food.

The essential parameters to be considered within food distribution can be split into three different categories:

  • Time frame for optimal freshness

This parameter considers the optimal time frame in order for the product to be as fresh as possible when arriving to the buyer. Shelf life of food, unlike other types of shipped goods, is limited. The date of harvest/production and travel time must be considered when creating a distribution plan. The time frame is dependent on the type of food product, as frozen or canned goods have a larger gap, than fresh produce

  • Temperature

Temperature control is a parameter unique to food. Food products all have different optimal temperatures to ensure that the product remains fresh and safe for the buyer to consume. Generally, food products ship at three different temperature ranges: Frozen (-21 to -18°C), chilled (0-15°C) and ambient or room temperature (Akkerman 2010). Poor temperature control can lead to chemical reactions that change the appearance or texture of a product (Akkerman 2010). Also, food safety regulations require temperatures during transport to be well established and well documented.

  • Shipping compatibility

Not all food can be shipped together. There are food safety regulations in place that ensure that food products are protected from contamination and the spread of harmful microorganisms (Alberta Agriculture and Rural Development 2015); therefore this parameter considers which products should be matched together to ensure the safest method for distribution.


These parameters are what separate this industry from regular shipping and need to be reviewed when considering changes such as co-delivery and route optimization. We want to make co-delivery efficient and easy to implement. The question is now – how can this be implemented? We’ve created a five step process to get you started:

1. Determine your transportation capacity

This step involves determining your ability for distribution. Are you able to deliver your products or are you looking for an outside source to deliver for you? This determines if you are the transporter or a transport user within a co-delivery scheme. Transportation capacity could also mean that you are only able to go to one major city during the week instead of two. Determining these parameters will allow you to know what you need from a co-delivery plan before connecting with other businesses.

2. Create a distribution logistics plan

This plan considers the physical distribution structure for your product and considers variables such as food safety regulation, space and weight used inside vehicle, vehicle type required, what type of food products to ship with, whether you do pick ups or deliveries, and others that are all specific to your product. The plan should consider every aspect that goes into the distribution.

3. Create a monthly/weekly schedule

At this step you have determined how you are going to deliver your product; now it’s time to determine when and where you are going to deliver your product. Create a monthly/weekly (dependent on your delivery frequency) schedule for a 6-12 month period that maps where and when you will be transporting goods. This schedule is bound to change, however it is important to have an idea on when/where you need distribution. This will also make it easier to coordinate with other suppliers for co-delivery.

4. Find and research possible co-delivery partners

Find like suppliers that would be a great fit for a co-delivery partnership. Make sure to consider all your variables you mentioned in your distribution logistics plan, such as food safety and what type of food products to ship with.  It also important to consider what their delivery schedule is and if you are able to match up based on yours. Possible suppliers can be found online by following social media pages of like-minded food producers, through online groups (most commonly found on Facebook), at local markets and through personal connections. How you find a co-delivery relationship can be very unique to you. Finding partnerships can be a difficult step and this is where Local Line hopes to jump in by creating connections between possible candidates – click here for a success story where we helped make co-delivery happen!

5. Connect and achieve

The most important step for implementing a co-delivery plan to your distribution logistics is to connect with possible partners. This is the starting point to making co-delivery possible. When you’ve found the perfect partner(s), remember to go back and review your logistics plans, transportation capacities and schedules to create a unique plan that works for your businesses.

Co-delivery can look differently for each participant. Some suppliers take a greater role in transportation, and some split the transportation equally. There are even examples where an outside distributor does the physical transportation and the fees are split amongst contributors. Just remember, the objective of co-delivery is to coordinate vehicle distribution routes from different suppliers to bring products to their buyers in the most efficient way.


References:

Akkerman R. Farahani P. Grunow M. 2010. Quality, safety and sustainability in food distribution: a review of quantitative operations management approaches and challenges. OR Spectrum. 32:863-904. Doi: 10.1007/s00291-010-0223-2

Alberta Agriculture and Rural Development. 2015. Distribution Logistics: Getting Your Products to Market [Internet]. Find here