International Aid Revamps Logistics, Transport Strategy
SPRING LAKE — International Aid, a nonprofit Christian relief agency active in disaster zones and destitute Third World areas around the globe, has decided to look to corporate charity for much of its logistics needs.
"We are getting out of certain aspects of our warehousing business and we are getting rid of our trucks," said Bob Goodwin, chief operating officer.
He said International Aid has operated a fleet of about 10 trucks and still has a 75,000-square-foot warehouse in Spring Lake, but noted that now there is much more manufacturing taking place abroad and fuel prices are "getting a lot steeper."
"So rather than having things coming to Spring Lake and then having to ship them out again, we thought we could better leverage the network of global warehouse, trucking and tracking through commercial partners than by running our own fleet of trucks," said Goodwin.
By mid-May International Aid had disposed of nearly all its trucks and reduced its Spring Lake truck fleet work force by 18 people, representing 16 full-time jobs.
"For the most part, we're going to have lots less things coming through the warehouse," he said, so unused space in it will be leased out.
He said management was assessing the nonprofit’s logistics needs in order to do "a major RFP to handle our transportation and tracking needs." He said International Aid has been in touch with major international shippers such as FedEx and DHL.
The organization was founded by Christian businessmen from West Michigan in 1980. Today it is one of the major nonprofit relief and development agencies in the U.S., with activities in disaster zones and impoverished areas around the world. It is involved right now with disaster aid efforts to help cyclone victims in Myanmar and earthquake victims in China, and over the years has delivered more than $500 million worth of supplies and resources worldwide. It provided $50 million worth of aid to the victims of Hurricane Katrina in the year following that 2005 American disaster.
Goodwin said the relief agency is working to fill materials requests for six clinics in Myanmar, where assistance from the outside world was being hindered by the uncooperative military government. Aid to the earthquake zone in China includes shipments of emergency supplies, possibly with donated assistance from FedEx, Goodwin said.
One of International Aid’s major ongoing projects is the manufacturing and distribution of its HydrAid BioSand Water Filter for families who live in areas where there is no safe, clean drinking water. In 2006, the organization opened a HydrAid manufacturing plant in Honduras, in the middle of a region where many filters are needed. The agency also has plans to put 100,000 water filters in Myanmar.
Goodwin said producing 10,000 filters here in West Michigan and then shipping them to wherever they were needed was easy enough for International Aid to do. But, he said, “If we're going to do millions of filters, the complexity of moving that many things around, to so many different countries and so many different communities — it suddenly raised the complexity to a point where we need help in doing that," he said.
Medical equipment is another specialty of the relief agency, which has a facility in Spring Lake where donated medical equipment is refurbished and then distributed around the world, along with medical supplies. Goodwin said the agency has outfitted entire hospitals in under-developed areas such as Indonesia and Africa.
"We still have to manage the logistics of getting those things around the world," added Goodwin.
He said the trucks the organization owned were used several times a week. "But to really get the maximum value out of trucks, you need to have them out on the road constantly," he said. If not, the cost of fuel, insurance and other aspects requires a look at more efficient operating strategies.
"We're getting out of the trucking business so we can really focus on what we do best," Goodwin said, which is amassing equipment and materials and then getting it shipped to where it is desperately needed.
But he emphasized International Aid is not out of the logistics tracking business: It makes commitments to its donors ensuring that all donated help and material reaches the people in need in an efficient, timely fashion. As an example, he said if a major manufacturer donates equipment or supplies, in the past it might have been shipped to Spring Lake and stored before being shipped out again. Now, when equipment or material is donated or sold to them at a discount, the agency looks for partners "on the ground" where the products are needed most and it will go directly there.
Part of the shift in its logistical strategies reflects the large volume of goods and materials it is now distributing.
"We are going from a fixed-cost model (of logistics) to a variable-cost model. That's especially important in our business because we are sending things literally all around the world," he said.