How one privately-held cold storage provider is challenging the big guys.
There’s no denying we’re entering an age of giants where big brands dominate almost every industry. Cold storage is no exception, where a few large players leave a heavy footprint often trampling or stepping over important things along the way—customer service, support and standards included.
Understanding the significance of these things to food companies has inspired family-owned, privately-held RLS Logistics to buck the trends and build one of the country’s most advanced cold storage facilities in Delanco, New Jersey.
“It’s unusual to have a company like RLS Logistics that’s building new facilities with technology that can go toe-to-toe with the big players in the industry—and that still values good service, is vigilant about food safety and can give customers the room they need to grow,” says John Gaudet, Vice President of Business Development, RLS Logistics.
“In today’s cold storage space, the Goliaths are building bigger and bigger. They’re funded by private equity money, and for them, it’s all about the real estate and getting an ROI for the PE firms. All they care about are process and profit at the expense of providing service and support—and it leaves customers vulnerable,” he says. “Then on the other end of the spectrum, you have smaller family-run companies who are, for the most part, not investing in upgrades and technology—and that’s not good either.”
RLS Logistics’ outlier approach comes at an opportune time to capitalize on long and short-term trends going on right now. According to Gaudet, “We’re dealing with a nationwide shortage of cold storage space—some of that has to do with the trade tariffs that are in place and a robust US economy. Additionally, other factors are disrupting the cold chain and expanding demand: the growth of e-commerce and direct-to-consumer fulfillment.
The Delanco facility’s 2.2 million cubic feet of high-tech, high-efficiency storage is positioned to satisfy some of that demand and capitalize on growth in the region. “It gets us closer to the Philadelphia port where a lot is happening, and it also puts us a little closer to the busy New Jersey ports,” says Gaudet.
This is phase one of a four-phase project that will grow to 8.5 million cubic feet and accommodate 35,000 pallet positions over the next several years. The first installment will showcase some of the most advanced technologies and practices in cold storage today. “These things are coming. A lot of them are already being used successfully in Europe and Canada, and our customers can benefit from them here and now,” says Gaudet.
The facility is the first to employ a transcritical CO2 refrigeration system, thus eliminating the need for environmentally-unfriendly HFC refrigerants or dangerous, heavily regulated ammonia-based systems, according to Tony Leo, CEO and President, RLS Logistics Warehousing Group.
Facility costs will be further reduced by a European-inspired mobile racking system in which pallets can be stacked high on racks that move on tracks. The racks can be compressed together without aisles to save warehouse space and when a pallet needs to be deposited or retrieved, the motorized racks move to create an aisle. “It allows us to store more pallets in a footprint because you don’t have all these aisles chopping it up. As a result, we’ll utilize up to 95% of the warehouse space,” says Gaudet.
To accommodate the system, the warehouse has 54-foot-high ceilings in contrast to most warehouses’ 34-foot ceilings—a feature which also makes the facility easier to cool, and hence more energy efficient, Leo says.
These design efficiencies are supported by a solar farm located next door that will power the entire facility with energy left over to feed back into the grid.
RLS will also energize the region through the direct creation of close to 100 jobs when all four phases of the facility are completed—and potentially 1000s more indirectly from manufacturers who locate adjacent to the complex in order to take advantage of RLS’s transportation services and cold storage.
The Delanco facility was planned with this purpose in mind. Expansive build-out space surrounds this new cold-spot, providing the opportunity for manufacturers to have all the temperature-controlled space they need attached to their building as well as the support of a full service 3PL attached to their facility.
According to Leo, “It makes perfect sense for manufacturers to locate here, especially the ones that are landlocked and have no room for expansion in places like Long Island and the New York metro area. These companies can set up here in South Jersey, build a state-of-the-art production facility on the property and have RLS as their cold storage and 3PL provider, saving them from ever having to shuttle product to an outside cold storage facility.”