Cold Chain Logistics Management and Monitoring – The Ultimate Guide
What Is a Cold Chain?
Cold chains are a kind of supply chain that specializes in the storage, transport, and preservation of cargo that needs to be maintained at a specific temperature or within an acceptable temperature range.What is Transported Through a Cold Chain?
Cold chains evolved due to a growing need for temperature-controlled logistics that could safely transport large quantities of food over great distances.
Over time, however, cold chains have become an essential part of modern supply chain solutions to transport more sensitive or vital cargo over great distances through diverse climatic conditions.
Cold chains are vital in the storage and transport of the following products:
Food & Beverages
Fruits & vegetables
Meat & seafood
Poultry & dairy
Processed & ready-to-eat food
Pharmaceuticals & healthcare products
Biologics (tissue samples, live cultures, etc., meant for medical research)
Plants & flowers
High-tech electronic/electrical components
While an important part of cold chain logistics management is maintaining low temperatures to preserve perishable goods, not all cold chain cargo needs to be transported at sub-zero temperatures. In winter, for example, some fruits & vegetables need to be kept warm to preserve their texture or to ensure they last longer. Different cold chain cargo needs different temperature and ambient conditions to be maintained, which is why cold chain logistics is also known as temperature-controlled transport or cool chain logistics.Temperature Standards for Cold Chain Logistics
Temperature-controlled transport is generally categorized into the following temperature ranges:
(-28 °C to -30 °C) Deep freeze — seafood, meat exports.
(-16 °C to -20 °C) Frozen — meat, certain types of produce.
(2 °C to 4 °C) Chill — fruit & vegetables, fresh meat, certain dairy products.
(2 °C to 8 °C) Pharma — medicines, vaccines.
(12 °C to 14 °C) Cool-chain — fresh produce, processed food, over-the-counter drugs.
Transporting goods at these temperature ranges would have been very difficult if not for the development of new techniques and technologies that help transporters achieve ideal temperature-controlled shipping conditions.
Temperature-controlled transport options give modern businesses the flexibility and confidence to develop global supply chains for temperature-sensitive perishable goods.What Are the Parts of a Cold Chain Logistics Operation?
The cold chain has four main components, each of which must work flawlessly to ensure the safe transport and storage of cold chain products:
Temperature-controlled storage — specialized refrigerated facilities where cold chain cargo is stored until it’s shipped out to a distribution center or its destination.
Temperature-controlled transport — customized insulated cold containers that help transport goods via airways, waterways, roadways, or railways.
Trained and diligent personnel — who are familiar with the complexities of handling sensitive cold chain cargo.
Efficient operational and management procedures — to minimize risk during day-to-day operations as well as contain it in case of unexpected incidents.
Managing cold chain warehousing and distribution is usually outsourced to third-party logistics operators (3PLs).
3PLs offer logistics services that can be customized according to specific requirements as well as scaled to suit changing needs. Experience and expertise in cold chain management allow 3PLs to operate at costs lower than their customers would manage for themselves.
How Is a Cold Chain Different from a Supply Chain?
Cold chains differ from regular supply chains in terms of:
Cargo sensitivity — cold chain shipments are quite sensitive to thermal stress, and tolerance levels are often just a few degrees.
Logistics hardware — which is far more customized and tailored to specific product needs.
Packaging — which is far more complex because it must insulate and contain sensitive products as well as volatile coolants.
Costs — cold chains are far more expensive to manage, both in terms of operational overheads and in the event of a disruption.
Cargo handling — which needs to be done with special care, in temperature-controlled environments.
Regulatory compliance — which is far more stringent these days, and differs from region to region.
Customs procedures — which are far more complex, especially when sensitive shipments of food or medicines are involved, or when they're packaged using refrigerants that may be strictly regulated in some regions of the world.
Operational complexities — cold chain logistics operations are significantly harder to manage due to factors like the nature of shipments, the potential for hardware/coolant failures, stringent regulatory and handling requirements, and so on.
The greater range that globalization demands from today’s logistics services is pushing the limits of both the packaging and the integrity of the modern temperature-controlled supply chain.
Given the potential for cold chain disruptions, the probability and cost of rejected shipments are higher than ever before.
What Are the Cold Chain Technologies Currently Being Used?
The concept of managing temperature-sensitive products has been around for a long time, but the technologies in play have evolved tremendously over the past few decades.
The technologies used in cold chain transport can be grouped into the following broad categories.Cold Chain Warehouse Storage Technologies
Deep Freezer (DF)
Walk-in Freezer (WIF)
Reefers — specialized trucks or containers with active cooling through battery-powered or other forms of refrigeration; can be used to transport bulk cargo over road, rail, or ocean.
Air freight containers — containers that are designed to fit the confines and compliance mandates for airline freight; usually used to transport smaller expedited cold chain shipments.
Ice Lined Refrigerators (ILR) — heavy-duty insulated containers that are lined with coolants; passive cooling that relies on its coolants to maintain low temperatures.
Phase Change Materials (PCM).
Cooling agents like ice, dry ice, gel packs, liquid nitrogen, etc. as dunnage.
Reefers — portable powered refrigeration units that run on fuel or battery packs.
Absorption or compression refrigerators/freezers — preferred when a power supply isn’t available or reliable.
Insulators — thermal blankets, specialized foam, cold insulation bags, Vacuum Insulated Panels (VIP).
“Dry” or “wet” shippers — a specially designed vessel with space for liquid nitrogen.
Cryoboxes or polyestyrene containers — special cold box or cool box containers that can be customized for specific cargo, usually Expanded Polystyrene (EPS) or Expanded Polyurethane (EPU) containers.
Active containers — highly compact portable reefers.
Rigid outer casing
Vacuum insulated thermal panels
A temperature control medium or PCM
What Are the Advantages of Cold Chain?
The cold chain is vital to improving global food security, supply better nutrition and medicines to the remotest regions of the world, as well as further medical and scientific research through the reverse cold chain.
Temperature-Controlled logistics also have an important role to play in modern-day business. Some of the advantages that effective cold chains give modern enterprises include:
Reduced product spoilage — which leads to lower inventory replacement costs and more revenue per shipment.
Lower likelihood of damaged product reaching customers — which mean fewer legal and PR liabilities.
Better product quality & consistency — which lead to better customer service and satisfaction.
Greater range of transport — which help boost exports and open new market opportunities.
Better regulatory compliance — especially in the transport of food and medical products, which must deal with more stringent norms that are being more strictly enforced across the world.
Efficient cold chain logistics are vital to franchisors and retail service providers who are eager to build global networks and take advantage of growth opportunities in emerging markets.
With over 70% of the world’s population residing in developing or emerging economies, there are huge business opportunities for companies willing to tap these emerging markets.
Enterprising companies are keen to take advantage of modern temperature-controlled logistics that push the limits of what’s possible, transporting greater volumes of more sensitive goods over greater distances.
This same push, however, is also amplifying risks.
What Are the Risks Involved in Cold Chain Temperature-Controlled Logistics?
Besides the usual elements of risk that plague normal supply chains, cold chain logistics has its own unique set of problems such as product sensitivity, the mounting cost of freight, and growing regulatory hurdles.
Some of the biggest risks in cold chain logistics include:
Issues during transport — such as disruptions in electrical supply for reefers, coolant or container/equipment failure (which can get compounded due to a lack of fuel or spare parts), poor coolant circulation within containers, exposure to the elements.
Issues during warehouse storage — such as power outages, poor insulation, non-uniform cooling.
Incidents during handling — such as loading/unloading operations in areas where temperatures aren’t regulated, bad handling that damages packaging or the product, exposure during transfers or last-mile delivery.
Insufficient cold chain capacity/infrastructure — especially in geographies where cold storage facilities and other essential cold chain components aren’t adequate.
There are many more cold chain risks that could trip up temperature-controlled transport, out of which, the major pain points include:
No uniform global practices to follow
Customs, legal, and compliance issues
Effects on the environment
Issues with cold chain delivery — packaging, hardware issues, vehicle breakdown, etc.
Chances of Human error
Consumer Demand Risk (Bullwhip Effect)
The Bullwhip effect occurs when a change in the consumer demand causes supply chain participants to order more goods in order to meet the demand thereof. When you're dealing with a cold chain, the bullwhip effect can get even more complicated since the goods involved therein are more sensitive to issues caused by delays or disturbances of any kind.
Basically, it is what the name says — a bullwhip effect — like a whip handle that creates a ripple effect of fluctuation with even a little whip, the change in demand also multiplies at each level, just like with an actual whip.
It affects the inventory at every level — ingredient manufacturer, parts manufacturer, module manufacturer, assembly, regional warehouses, stores, and so on, and gets more intense at each successive level, giving way to goods as well as pallet over-stalking, which is a real problem.
Ultimately, the increased uncertainty causes lower forecast accuracy, which in turn contributes to unnecessarily high inventory volume.
Logistics operations — conventional or temperature-controlled — are rife with risk.
Most risks are obvious, some are overlooked, and far more remain hidden, especially to the untrained eye. Regardless of the type, cold chain logistics risks (especially to food and medicine shipments) leaves billions of dollars exposed to significant loss.
What Are the Current Trends That Are Pushing Cold Chain Risk Management Strategies to Evolve?
Globalization – and new market opportunities.
Stricter Regulations — especially for food and medical shipments.
Higher Product Sensitivity — especially for medical and high-end products that have a lower tolerance for temperature excursions.
Availability of Better Technology — both for the storage and transport of temperature-sensitive goods.
Cost Fluctuations — especially the rising cost of air freight. Better technology is enabling shippers to consider modes of transport like ocean liners or surface transport that wasn’t viable earlier due to issues with reliability.
In an effort to reduce cold chain risks and improve operational efficiencies, enterprises and 3PLs alike are stepping up their game in both cold chain risk assessment and management. While there may be some difference in opinions about the best strategy to reduce cold chain risks (and costs), the first step is usually a push for better cold chain visibility.
Cold Chain Risk Management
The biggest and most obvious risk to cold chain operations is temperature excursion, which leads to temperature-controlled transport’s biggest problem – product spoilage.
Processes, participants, external factors, poor management of resources, limited financial capacity, and shipment security — these are some of the weakest links in cold chain operations that inevitably result in temperature excursions, or worse.
The easiest way to identify (and subsequently reduce) risk is to spot problems before they have a chance to snowball.
That’s where tracking technologies come in.
Which Cold Chain Monitoring Technologies Can You Use?
Temperature tracking is the first step toward effective cold chain management.
To minimize the chances of temperature spikes in transit, transporters used simple measures like risk-assessment for standard routes to identify their safest option, using dedicated vehicles, using things like phase change gel bricks to identify excursions, or doubling up on packaging and active cooling to secure their shipments.
Newer technologies have given logistics players more options to track and manage their cold chain operations though.
Some of the most common and effective temperature tracking solutions for cold chains include:
- Infrared Thermometers
Allows a user to scan shipments from a distance and measure surface temperature.
- Wired Digital Thermometers
Sensors are placed in the cold storage area and hooked up to a monitor/logging device through wires. Usually used to monitor ‘deep freeze’ or ‘frozen’ shipments, where conventional temperature loggers can’t survive due to the extreme cold.
- Temperature Data Loggers
By far the most popular cold chain temperature tracking solution today, temperature data loggers are usually part of the cold chain shipment in transit. Temperature data loggers are commonly classified into the following types:
- Passive Temperature Loggers
Battery-powered devices that simply log temperature data at set intervals, which can be downloaded for analysis through USB or other connectivity options.
- Wireless Temperature Loggers
RFID or Bluetooth temperature data sensors (also known as beacons) that are similar to passive temperature data loggers. Their data can be accessed wirelessly, making it easier to use in large-scale operations.
While the data gathered by temperature loggers helps to detect temperature excursions and spoilage more reliably (perhaps even make improvements to overall efficiencies) they can’t really help reduce product spoilage.
That’s because most logger reports are generated well after the temperature excursion occurs, which means there’s nothing that can be done about it.
Not all cold chain products spoil as soon as they cross their ideal storage temperature. Rather, it’s the ‘degree’ and ‘frequency’ of changes in temperature that determine whether they spoil.
Although a temperature spike may not necessarily indicate spoilage, stringent norms for the secure transportation of food and medical products dictate that the entire consignment be discarded.
To reduce such unnecessary wastage in cold chain shipments, industry players are shifting to a different system — known as Mean Kinetic Temperature (MKT) — to better gauge the impact of inevitable temperature excursions in cold chain logistics on the health of their shipments.Are Cold Chain Drugs Adequately Inspected to Prevent Spoilage?
Technology has come a long way when it comes to tracking and tracing cold chain, but it is still in the process of getting where it needs to be when it comes to monitoring the cold chain, especially when dealing with pharmaceutical cold chain. More often than not, cold chain drugs get spoiled or damaged during transit, or at a facility for the lack of adequate inspection.
In absence of optimal solutions to problems like temperature excursions, cross contamination, and delays in delivery causing spoilage, the pharmaceutical cold chain suffers more than it can handle.
Although we have temperature loggers, and BLE beacons to take care of a lot of things going on in cold chains, what is actually required to perfect cold chain monitoring is — managing the MKT, real-time updates, actionable information about the supply chain, and predictive analytics to make the best use of the available data.
To overcome these limitations, transporters need more timely updates on the state of their shipments. This led to the development of newer ‘active’ temperature data loggers. Like passive and wireless loggers, they record temperature data. What sets them apart is the ability to connect to a communication network (like GSM or Wi-Fi) which allows them to transmit live data as well as instant alerts in case of temperature excursions.
The ability to register temperature excursions in real-time was a game-changer for risk management in cold chain operations. Temperature-Controlled logistics management switched from reactive to proactive, and transporters began to explore the advantages of data-driven decision making.
The constant drive to improve efficiency (and cost-efficiency) pushed cold chain management toward solutions that leverage the advantages of constantly connected and communicating devices.
Cold chain management, whether it realizes it or not, has taken its first definitive steps into the IoT age.
How You Can Use IoT Enabled Cold Chain Monitoring Solutions?
The need for more data to make better decisions has spurred further improvements to cold chain monitoring solutions, some of which include:
Constant communication for real-time temperature updates and alerts.
Additional data such as shipment location, its condition, and relevant external feeds like weather and local traffic conditions.
Smaller, portable, energy-efficient monitoring devices that can be used for multi-modal shipments and can be managed remotely.
Convenient reports, real-time dashboards, and better contextual information to make cold chain monitoring and management easier.
Cloud-based real-time predictive analytics to identify risk as well as opportunities to improve efficiency.
Real-time contingency and crisis management that takes full advantage of live cold chain monitoring, staying one step ahead of any disruptions.
Cold chain risk management strategies are being upgraded to take advantage of these developments, leveraging the power of automation, machine learning, and predictive insights that such systems allow for.
The hybrid combination of robust monitoring devices, constant connectivity, and analytics that enable data-driven improvements to cold chain logistics operations represents the pinnacle of cold chain monitoring and management systems.
How Can You Introduce Live Cold Chain Monitoring in Your System?
Real-time intelligence is vital to monitor a temperature-controlled shipment’s condition, route/carrier performance, as well as to stay one step ahead of the cold chain risks that could disrupt operations.
Understanding and optimizing cold chain performance is often constrained by a lack of effective visibility. While it’s possible to piece together a reasonably complete picture of cold chain performance through periodic reports, historical data analysis, or ad-hoc evaluations, you need systems in place that provide constant insight into cold chain performance and day-to-day operations.
The easiest and best solution to achieve that is through hybrid IoT cold chain monitoring systems that combine the best of two worlds – physical machines gathering real-time data that’s streamed to virtual machines in order to generate real-time predictive analytics.
An ideal real-time cold chain monitoring solution should be set up as follows:
Deploy sensors/monitoring devices to gather live temperature data.
Ensure the devices also gather other contextually important data like location and condition.
Monitor at the package-level to reduce the risk of missing hotspots in cold chain storage or transport.
Ensure constant connectivity to guarantee real-time temperature excursion or anomaly alerts.
Fine-tune the data analytics and predictive algorithms, ensure your smart system is firing on all cylinders.
Make sure the reports, alerts, and the overall system is easy to use for relevant stakeholders.
Ensure there are contingencies and measures for rapid response in place to capitalize on predictive or real-time alerts.
Make sure your monitoring hardware is reusable and easy to recover to maximize ROI.
Make sure the monitoring system is pay-per-use or pay-as-you-go; ensure its scalable when required but flexible enough to accommodate fluctuating budgets.