“OUR PRODUCTION SITES NEED INFORMATION ON TRANSPORT ORDERS TO PLAN IN ADVANCE.” P.03ARNAUD DESMONTS,ArcelorMittal transport & logistics director

PERSPECTIVES

The freight players’ magazine WWW.FRET.SNCF.COM

FR NO. 33_FEBRUARY 2017

P.07

DOSSIER

REINVENTING CUSTOMER

INFORMATION

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Fret SNCF and ArcelorMIttal are currently working on a project to interconnect their information systems (IS) – a huge task that will lead to tracking goods more accurately. ArcelorMittal Transport & Logistics Director Arnaud Desmonts and Fret SNCF Information Systems Director Jean-Marie Pommier fill us in.

What are the project’s goals? Arnaud Desmonts: We’re always trying to boost our productivity and efficiency. To do that, our production sites need information on transport orders to plan in advance and avoid interruptions of activity. They want more accuracy and predictability. But we can’t always give them the right answers, information feedback is neither fluid nor reliable enough.

ZOOM RAIL: A NEW SOLUTION FOR FRANCO-CHINESE TRADE P.10

DOSSIER REINVENTING CUSTOMER INFORMATION P.07

360°MARKET TRENDS AT A GLANCE P.04

Jean-Marie POMMIER: IS can now meet those needs. We give our customers very specific added value by making our data accessible to them in real time. We show that rail transport monitors its deadline commitments and is well integrated into companies’ logistics chains.

Could you be more specific about how the process works? J.-M. P.: The basic idea is simple. The order is paperless. Then, all our tracking information enters our customer’s IS, either through the interface or a specific portal. The customer then has direct access to information on the shipment. That’s a major change. Previously, order or tracking data transited by e-mail or Excel files and required human intervention.

A. D.: That’s a key aspect. The new process lets the teams focus on managing anomalies, if

necessary, instead of on fastidious data entry tasks, which generate errors. The added value, then, focuses on the most useful task: tracking. That matters for a group like ours, which dispatches 20 to 30 trains a day!

ArcelorMittal operates in several European countries. Is that scale integrated into the project? A. D.: Yes. The improvements are actually most eagerly awaited outside France. On a Spain-Poland link, for example, the whole route is important for us, not just the stretch in France.

J.-M. P.: On that point, we’ve got to bring our international partners and service providers together in order to stimulate accurate feedback. That’s crucial for all of Europe’s rail freight players.

What are the next steps?A. D.: Data exchange is the first

one. The goal is to have a completely paperless chain until invoicing. This is a three- or four-year plan including important training for our teams. J.-M. P.: We want to be as agile as possible and gradually deliver different bricks. This pragmatic strategy allows us to customize our approach to ArcelorMittal’s expectations. It should add value to the logistics chain’s different steps. If you add the upcoming arrival of new digital services directly on the cars, it could be said we’re on the brink of major changes that will transform freight.

DECIPHERINGTHE FREIGHT CAR "COUPON": A SIMPLE, COMPETITIVE NEW SOLUTION P.06

CLOSE-UPFRET SNCF GETS NEW ORDERS FROM THE ARMY P.12

SNCF LogisticsRail and intermodal business unit Communication Departmentcommunication.fret.sncf@sncf.frDirector of the publication: Sylvie Charles Delegator director of publication: Philippe Moritz Editor-in-Chief: Nafi Mbaye Diallo Tel.: +33(0)1 80 46 22 67ISSN (coming soon) Design and production:

Copyright: Loulou&Tummie (cover); S. Cambon (p.2-3, p.12); V. Colin (p.5, p.8-9), N. Fremiot, S. Godefroy (p.4-5); La Suite Illustration / Le Duo (p.10-11);Writers: A. Dubois; S. Livingstone Wallace; J.P. Montal; N. Mbaye; F. Rey.

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ARNAUD DESMONTS ARCELORMIT TAL TR ANSPORT & LOGIS T IC S D IREC TOR

JEAN-MARIE POMMIER FRET SNCF INFORMATION SYSTEMS DIRECTOR

IS AT THE SERVICE OF BETTER INTEGRATING TRANSPORT INTO THE LOGISTICS CHAIN

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360°

WHAT THE UTP WANTS FOR RAIL FREIGHT In November, the Rail and Public Transport Union* suggested five ways to give rail freight a new impetus. Although 2015 suggested recovery was just around the corner, the volume of goods carried in the first half of 2016 fell by 5%. For the UTP, it is necessary to have a performance contract between State and SNCF Réseau in a framework suitable to the sector’s growth, with means; work on performance and competitiveness for the end customer’s

benefit; establish a bonus for transferring from road to rail by studying the possibility of a

dedicated recipe; and change the regulatory and organisational framework so that freight receives fairer treatment compared to passenger transport as well as to maintain and ensure the long-term viability of feeder lines and service tracks. *A trade organisation grouping together, among others, freight and passenger rail transport companies (including SNCF Mobilités, ECR, Europorte and Objectif OFP).

CUSTOMER SATISFACTION IS UP IN 2016

The ninth annual Fret SNCF customer survey revealed that image and satisfaction indicators are sharply up (+8 points). Higher scores for the block train (TM) and single wagons load offers explain the findings, with 86% and 70% of satisfied customers, respectively – the best results since 2012. Fret SNCF’s commitment to transport good with a high level of security also received high marks (92%). Safe conditions for hazardous materials shipments being a leadinf edge over competitors.

www.fret.sncf.com+ D’INFOS

This has been a tough year for freight traffic not just in France, but also in Germany, where rail transport is embedded in the industrial fabric. On this side of the Rhine, uncertainty early in the year about steel production, strikes during the spring and the worst grain harvest in four decades were the main temporary factors behind falling traffic. On the structural level, track quality and the maintenance of rail freight infrastructure are issues of concern and watchfulness for SNCF Logistics’ rail and multimodal companies. In this context, we must work on what we can directly control in order to boost our competitiveness and win back market shares from road transport.

In 2017, digital innovation will be the locomotive of new strides aiming to enhance our performance: industrial command, customer relations, changes in professional practices, new services and many other fields of action are open to modernise rail freight for the benefit of shippers and forwarders. Far from being replaced by technology, human contact with our teams will be improved in order to create more added value and growth.

PUTTING MORE FAITH IN FREIGHT

SYLVIE CHARLES GENERAL MANAGER

OF SNCF LOGISTICS RAIL AND INTERMODAL BUSINESS UNIT

LE MOT DE…

5 ACTIONS to improve freight’s performance

FORWARDIS: READY FOR “GRAND PARIS” The SNCF group’s rail and multimodal freight forwarder set up a dedicated team of specialists to meet the shipping and evacuation needs of construction industry and public works players in the framework of the “Grand Paris” project’s building sites. Created in SNCF Logistics in January 2016, Forwardis offers tailor-made solutions.

Contact Forwardis:GrandParis@forwardis.com

TRANSPORT SAFETY,

92% of customers are satisfied

THE “VAL DE SAÔNE” GAS PIPELINE, A DUAL WIN FOR SNCF A subsidiary of German steelmaker Salzgitter asked Captrain Deutschland and Fret SNCF to ship over 5,000 GRTgaz tubes on a very tight schedule to update a gas pipeline between the Ain and Haute-Marne. From late July to late November, 55 trains carried steel tubes from the Salzgitter plant (Lower Saxony) to the Tavaux logistics hub (Jura), where they were loaded onto lorries and brought to the pipeline. “These fully loaded trains,” said Captrain Deutschland sales director Birgit Mazur, “ran on time four times a week while meeting all safety requirements.” The Tavaux Freight hub underwent a major refurbishment to ensure traffic safety and allow lorry access before resuming its activities expressly for this project.

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I nformation is a recurring theme in annual customer satisfaction surveys — and grounds for discontent,” says Sylvie Engel, the Fret SNCF sales support department’s IT systems director. “It’s been a strategic

project of ours since 2014!”

A KEY ISSUE FOR INTERNATIONAL CONNECTIONSThe decisive, far-reaching goal is to give

customers reliable, up-to-date information — first of all, because accurate information on pick-up and delivery times is crucial for Fret SNCF customers. Improving schedules and efficiently managing stock depend on it. Second, because the word “information” spans a complex chain of several, sometimes very weak links — especially for international traffic, when exchanging information with the various partners isn’t always a smooth path.

In 2017, Fret SNCF will roll out a pragmatic, visionary new customer information programme. Digital technology and human contact will complement each other to increase value for customers.

REINVENTING CUSTOMER INFORMATION

The freight car “coupon”: a simple, competitive new solution

BY POOLING TRANSPORT The “coupon” offer is based on the observation that the maximum tonnage a circulating train can carry is not always reached. That prompted the idea of offering other customers the leftover capacity by adding cars to an existing train.

BY BOOSTING REACTIVITY Facing just-in-time logistical constraints and tight deadlines, customers are seeking increasingly reactive transport solutions today. The “coupon” offer’s fast-order process allows them to cope with uncertainties and last-minute orders better. It is geared to keep up with activity spikes and in order to meet occasional needs without any obligation to make a long-term commitment.

BOOSTING RAIL’S APPEALFret SNCF is rolling out an industrial and commercial efficiency programme offering its customers more innovative and competitive transport solutions. The win-win process allows Fret SNCF to target their needs better by using already active resources.

THE FIRST RESULTS ARE POSITIVE In 2016, Fret SNCF launched the coupon offer on the heavily travelled route linking the Hauts-de-France region to the East and Southeast. The results are positive: satisfied customers and over 60 deals. In 2017, the offer will be expanded across France and to the main international routes.

BY OPTIMISING COSTS The coupon is a competitive, middle-ground solution between long trains and single wagon load. Based on optimising and pooling transport costs, it is very appealingly priced, especially for customers that normally use road or river transport.

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The more interlocutors, the harder it is to trace the information and its history.“Our culture,” says Ms. Engel, “led us to wait for sure, definitive information before transmitting it. But our customers need ongoing exchange in order to keep informed. If there’s a problem, they have to know its nature, the planned solution and the new deadline. We’ve got to include our partners in the process of giving an exact arrival time when a shipment runs smoothly and, especially, communicate all the helpful data if there’s a problem. It’s a bit like what SNCF did for passenger traffic.”

Arkema worked with SNCF on a model for tracing isolated freight cars across borders. Are you satisfied with it? For Arkema, borders no longer mean anything in logistics. One of the project’s goals was being able to

or what the problems were. So we expect our shippers to meet contractual deadlines, which is even more important for sensitive products that can be kept on site for a limited time only. What’s more, if anything goes wrong, we expect shippers to be reactive and even proactive, to be more exact. You owe us data about problems. The ability to track the goods and give customers the right information is a differentiating factor amongst logistical service providers and gives Arkema a competitive edge.

track rail cars end-to-end, especially outside France with information from the ISR base. We’ve developed a prototype allowing us to make sure, on a daily basis, that no car is blocked, for us as well as for the Fret SNCF customer service. It helps us

A pragmatic methodIn 2015 and 2016, several proofs of concept (POC) were carried out to test new processes and compare them with needs expressed by customers on various kinds of markets. They were based on specific flows, but with a wider vision aiming to develop solutions useful for all. Four POCs were launched based on problems encountered by Gefco, Arcelor or Arkema (see box). “A company like Arcelor represents 800 loaded cars a day criss-crossing Europe,” says Xavier Richard, customer information project manager for steelmakers. “Working closely with these

customers, we’ve developed a complete overview of their circulating trains, allowing us to prioritise the most strategic flows and offer solutions for the 5 to 10% of freight cars that are late.” The tool provides an accurate snapshot of all the trains on D-1. “It’s an opportunity for daily contact,” Mr. Richard adds. “The person who passes the information on to customers is also responsible for enriching it.”

Human contact is still essentialFret SNCF will launch the new customer portal’s first version in early 2017. Redesigned ergonomics and fluid, accurate, accessible information will allow customers to see their order’s location anywhere in Europe on a map. Technology will improve, not replace, the direct relationship with Fret SNCF order managers. Their job is changing in order to offer customers more services and added value. “Until now,” says Ms. Engel, “our customer service teams have focused only on orders in circulation. Now they’ll have more time to concentrate on their customers relationship. If a problem arises, of course direct contact will still be primordial.” Customer information is on the right track.

What are the goals of your logistical information chain? Our customers have a simple expectation: safely receiving the product ordered by the requested date. Our job is to organise our logistical flows with the aim of satisfying them. If these requirements are satisfied, they don’t care how the product arrived

“THE TOOL DEVELOPED WITH SNCF HELPS US BE MORE REACTIVE AND PROACTIVE WHEN SOMETHING’S WRONG WITH A RAIL CAR.”

“I’m responsible for sales relations with four customers — the equivalent of 10 full trainloads a week. Managing information streaming in from the field is a key part of my job and not always easy. For example, if something’s wrong, our Italian contacts may warn the goods’ intended recipient but not necessarily the person who placed the order, who’s

left in the dark about the nature of the problem and the steps being taken to solve it. Thanks to the new order-tracking software, I have all the useful information at my

fingertips: shipping and delivery dates, the number of cars, the train’s composition, etc. It’s also very easy for us to monitor alerts if a train is modified. A new feature also lets us see the train’s planned and actual route. A mine of data informs the customer and offers solutions. The new software doesn’t replace direct dialogue. On the contrary, it helps us go further by combining feedback with our knowledge of the customer’s history.”

POINT OF VIEWALEXIA CHAUVEAU, ORDER MANAGER, ITALY, FRET SNCF

VERY CLEAR ERGONOMICS

AND STRONGER DIALOGUE

to be more reactive and even proactive when we notice something wrong with a car.

How can SNCF meet your information expectations better? Arkema has benefitted from the operational efficiency SNCF is capable of in crisis situations. That level of service must become routine. Ideally, on my mobile phone I’d like to receive the confirmation of problems with freight car delivery dates and be quickly informed, if necessary, about the revised date by which it will arrive.

3 QUESTIONS FORSOPHIE KOHLER, Rail Service/Logistics Department Manager-Arkema

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TRADE BETWEEN CHINA & EUROPE

• Ten to 12 container trains a week in 2016 from China to Europe and five to seven in the opposite direction

• The Chinese government is planning to expand rail links, aiming for 5,000 trains to Europe by 2020 (source: National Development and Reform Commission of the People's Republic of China, Beijing, October 2016).

RAIL’S ADVANTAGES

A CHANGING MARKET

THE FRENCH MARKET

• In 2015, France exported 285,000 tonnes of food products to China, including 160,000 tonnes of wine and alcohol.

• France imported 80,000 tonnes of goods from China by air (equal to 80 trains), including 50,000 tonnes of hi-tech products and textiles (source: Eurostat).

• New targets:

– 130 French companies in Wuhan

– Goods traded in the automobile industry, retail, SMEs, etc.

– New trade relations with China, exchanges of intermediate goods between companies, tomorrow e-commerce in direct flows, etc.

Needs are mostly incompatible with the high price of air transport and length of maritime shipping times.

FRANCE’S ASSETS

Chinese goods bound for Spain and the United Kingdom (via the ports of Dunkirk and Calais) also transit through France by rail.

RAIL: A NEW SOLUTION FOR FRANCO-CHINESE TRADE

Fret SNCF is operating the French stretch of a Wuhan-France line via Duisburg since 2016. The unprecedented link is part of China’s great plan for new “silk roads”. As the country’s market changes, opportunities are rising and rail is proving its usefulness alongside air and sea. New lines may start operating in 2017.

Responsiveness Goods can be shipped in the week after the order is placed.

Energy costs Rail is less dependent on rising oil prices than other means of transport.

Proximity Railways are closer to the Chinese regions that are growing further inland, if shipping to and from the airport is taken into account.

PredictabilityArrival times are more predictable (two to three days) than for maritime shipping, which is much more random in terms of when goods become available. Air is faster, but only relatively, if shipping to and from the airport is taken into consideration.

SEA/AIR

30000 / 45000 €

17 to 22 days

AIR

3 to 5 days

45000 / 65000 €

SEA

35 to 45 days

3000 / 3500 €

For a 40’ container

20 tonnes equivalent 40’ container

20 tonnes equivalent 40’ container

RAIL

18 to 22 days

6500 / 7500 €

For a 40’ container

Contact Forwardis, a rail and multimodal freight forwarder, is in charge of this development for SNCF. xavier.wanderpepen@forwardis.com

Indicative door-to-door shipping times in the Wuhan and Lyon regions. Prices observed in 2016 for a 40’ container or 20 tonnes equivalent in air transport. Prices are indicative and do not have absolute value.

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