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Dedicated Analytical SolutionsCHINA AS A GLOBAL DISTRIBUTION CENTRE

Date: DSV Conference, Amsterdam 24/6-2015

Presenter: SVP Per Sonne Sørensen

Dedicated Analytical Solutions

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CONTENT

FOSS in brief

FOSS in China

Our Shanghai Bonded Warehouse

Challenges and learnings

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THE FOUNDATION OF FOSS

In 1956, Nils Foss identified the need for a portable moisture analyser

Fast, easy-to-use and dedicated, the Cera-Tester was the first FOSS innovation

Matching innovative technology to the demands of particular industries has been the foundation of FOSS ever since

FOSSSOLUTIONSANALYTICALDEDICATEDINTRODUCTION


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DEDICATED TO THE FOOD & AGRICULTURAL INDUSTRIES



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HOW WE ADD VALUE

”We deliver rapid, reliable and dedicated analytical solutions for routine testing to allow for fast decisions on how to maximise value of production of agricultural food products”

Improved predictability and control of manufacturing processes

Safe products and compliance with regulatory requirements

On-farm Receiving points

At-line/In-line production

Quality Control Laboratories

Finished products


Payment, segregation and quality control of raw material


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SETTING THE GLOBAL BUSINESS STANDARDS - EXAMPLES


MilkoScan™The de-facto global standard for testing of milk and dairy products

FT-IR

Infratec™ 1241The de-facto global standard for payment analysis of whole grain for more than 25 years

NIR

NIRS™ DS2500 and NIRS™ DA1650 The latest generation of the most used NIR platform in food and agriculture

NIR


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SETTING THE GLOBAL BUSINESS STANDARDS - EXAMPLES

SOLUTIONSANALYTICALDEDICATEDINTRODUCTION FOSS

BactoScan™ FC+The world’s first automated bacteriological milk analyzer

Flow-cytometry

MeatMaster™The first X-ray based analytical solution to provide 100% control of meat

X-ray

Fossomatic™ FCThe world’s first (and leading) somatic cell counter for improved milk quality

Flow-cytometry


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FOSS KEY FIGURES


100%

98%

231 mill.

AAA

18%

63%

A 100% family-owned company – HQ in Hilleroed, Denmark

98% of turnover outside Denmark

A turnover of 231 million EUR

AAA-rated by D&B

EBITA of 18% of turnover

Solvency ratio 63%


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FOSS IN CHINASALES, SERVICE AND PRODUCTION

We sell and service our products in China w. 75 employees

Turnover >> 200 MRMB (30 Meuro)

20+% annual growth rate

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Sales and Service:

R&D and Production in Suzhou with 200 employees

Internal group sales of approx 200 MRMB (30 Meuro)

Development and Production:


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FOSS ANALYTICAL, SUZHOU

”FOSS Analytical Co., Suzhou” wasestablished in August 2008, in Suzhou Industrial Park, 80 km West of Shanghai

New factory opened November 2012:

•6.000 Square meters•200 employees•Turnover 2015 Est 200 MRMB


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FOSS ANALYTICAL, SUZHOUPRODUCTS AND FUNCTIONS

Complete product range of Chemical Analysis

instruments for the global Laboratory segment is

now being developed and produced in FOSS

Analytical, Suzhou

Modules build for NIR-products

• All functions established to support the

global market:

• Business Innovation

• Product Innovation.

• Production and Supply Chain.

• Customer Service and Support.

• Regional Demo- and training lab

• In house repair shop

• Bonded outbound Warehouse

• NIR module production

40% of everything produced in Suzhou – was sold in China


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THE BONDED WAREHOUSE IN SHANGHAI -

OBJECTIVES

Objectives:

Reduce inbound lead time from 10 to 2 weeks

Reduce Net Working Capital. Inventory and goods in transit. 10 MDKK – 1,5 MEuro

Save distribution cost compared to sending all CA instruments and spare part manufactured in FOSS Analytical, Suzhou to Global European Distribution center. 200 KEuro/Year


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OUR SOLUTION

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A DSV controlled warehouse in the Bonded Zone by PuDong Airport.

Warehouse operated by 3rd. party

2 days in - from pick-up factory to shelf BWH

3 days out - from order to shipment


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GLOBAL DISTRIBUTION OF FOSS SOLUTION

– FLOW

FOSS Companies

Present Distributors

Instruments and Spare parts are delivered from FOSS Analytical in Suzhou to Bonded Warehouse in Shanghai. From BWH to HQ, Sales Subsidiaries, European Distribution Centre and end customers.


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CHALLENGES AND LEARNINGS

It took a lot longer to implement than originallyplanned. (+1 year)

Masterdata – not the least HS-codes and materialdescriptions does require a lot

Legal requirements of the Bonded Warehousecompared to other in/out of China

Some markets are difficult to serve from China –either due to legal/Bureaucratic reasons or due to customer’s preferences

Good overall performance out of the BWH 95%+

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