Logistics Plan Report
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1
Proposed Logistics Plan for
Importing Avocados from Mexico to
Canada
Presented by: Thashmila Nadeeshani 4542309
Monica Natchathira Reeves 4548057
Sulav Bista 4552572
Sameika Johnson 4487541
Niagara College, Toronto
BICG9502 Global Logistics Management
Presented to: Dr. Mirbehzad Feizbakhsh
02.13.2024
2
Table of Contents
Proposed Logistics Plan for Importing Avocados from Mexico to Canada
.....................
1
Executive Summary
...............................................................................................................
3
Introduction
...........................................................................................................................
4
Product Details
......................................................................................................................
4
Origin of Shipment
.................................................................................................................
5
Packaging
..............................................................................................................................
6
Transportation plan
...............................................................................................................
8
Transportation costs
............................................................................................................
10
Warehouse/distribution centre requirements
.....................................................................
12
References
...........................................................................................................................
14
3
Executive Summary
4
Introduction
Exporting fruits and vegetables has a direct impact on Mexico’s GDP, which contributes to a staggering 45.95%. Mexican avocados were the 2
nd
most exported item in the country. (Javier & Valencia, 2022) The logistics requirement for exporting to Canada requires a thorough discussion of the transportation of goods, transits, competencies, and costs involved in the process. Product Details Mexico produces more than 771 million kilograms of their specific avocadoes “Hass” which is exported across the globe. The Mexican avocados are always in the season which eliminates the threat of shortage for countries like Canada with long winters. The particular Hass variation contains 12% oil concentration and 70% water with high Vitamin B and Vitamin E. (Javier & Valencia, 2022) 08044000 is the harmonized system code for avocados. The carton boxes pack 4 kilograms of avocados, 216 boxes per pallet, or boxes of 25 pounds with 80 boxes per pallet. These avocados are considered solid state and cause no harm to property or the environment. (GC IMPORTERS LTD - Tropical Fruits, n.d.) The optimum temperature when transporting avocados is 5.5°C ± 0.5°C including a minimum air delivery of 4.5°C. The air that enters the container is being controlled to maintain the optimum quality of the goods. (Bester, n.d.)
5
Origin of Shipment
The avocados are imported to Canada from Uruapan, Michoacan, Mexico where the produce starts its journey to Canada. As Canada and Mexico have been in trade since 1994 under
the North America Free Trade Agreement (NAFTA) and recently developed stronger trade agreements with the Canada-US-Mexico Free Trade Agreement (CUSMA), the trade has been growing at a steady rate and provides the most stable logistics for importing the avocados from Mexico to Canada. In 2022, Canada also invested $33B in direct investment for Mexico. Mexico is also identified as a primary market for EDC (Export Development Canada). (Canada, 2020) Avocados have not been subjected to tariffs in Canada, and the growth rate of imports has been increasing in the last decade. (Carlberg & Rude, n.d.) The import quota depends on the Canadian
government upon applying for an international import certificate. (Javier & Valencia, 2022)
6
Packaging
Type of Packaging and Total Number of Packages:
For the packaging of this shipment, carton boxes will be used as it aids in mitigating moisture and extreme temperature (Malouf, 2023).
The avocados are packed in carton boxes of 25 pounds and carton boxes of 4 kilograms. For the 25-pound packaging, the available sizes include 32's, 36's, 40's, 48's, 60's, 70's, and 84's, with 80 boxes per pallet. On the other hand, the 4-kilogram packaging offers sizes/count of 12's, 14's, 16's, 18's, 20's, 22's, and 24's, with 216 boxes per pallet.
The total number of packages is 2072 packages. Weight per Package and Total Weight of the Shipment:
According to Rettke, D. (2019) Some areas in Mexico have faced cooler weather in recent winter months, impacting the sizes of avocados imported into Canada. Smaller sizes have predominantly characterized these avocado shipments. Furthermore, Discovery Organics, known
for supplying Fair Trade avocados, adheres to a system where size selection is not within their discretion; instead, shipments are organized based on weight.
For the 25-pound packaging, the weight per package is 25 pounds, and with 80 boxes per pallet, the total weight of the shipment is calculated by multiplying these values. Therefore, the total weight is 2000 pounds per pallet. Additionally, for the 4-kilogram packaging, the weight per package is 4 kilograms and 216 boxes per pallet.
The total weight of the shipment is 3903.52 pounds.
Dimensions of packages. Total cargo volume
25-pound Carton Box:
Dimensions: 24" x 16" x 6"
Volume per box: 24×16×6=2,304 cubic inches24×16×6=2,304cubic inches
Total volume for 80 boxes on a pallet: 80×2,304=184,320
cubic inches80×2,304=184,320cubic inches
4-kilogram Carton Box:
Dimensions: carton box size of 12" x 8" x 4" Volume per box: 12×8×4=384 cubic inches 12×8×4=384 cubic inches
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- Purchasing and Supply Chain ManagementOperations ManagementISBN:9781285869681Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. PattersonPublisher:Cengage Learning
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ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Cengage Learning