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The Challenges of a Special PV Operation

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1 The Challenges of a Special PV Operation

2 A special operation.... 1. History 2. Customers & Organization 3. Daily challenges...and more 4. Operation Odyssey Dawn (ODD)

3 History 1998- Subsistence Prime Vendor and Transportation support for GFM goods 2002 / 2003 Setup logistical pipeline for Class I subsistence for ; Operation Iraqi Freedom (OIF) Operation Enduring Freedom (OEF) PV in Kuwait and Iraq for OIF/OEF FF&V & Water BPA for OIF/OEF in Kuwait and Iraq 2004- FF&V BPA for Spain & Ships 2010 Ebrex Food Services becomes part of the ES-KO Group and can now draw on the Group’s support GFM : mainly bread & dairy Blakans…. +

4 Customers All military services based in southern Europe
All vessels (including T-AFS) in ; Mediterranean and Black Seas (6th fleet AOR)

5 Geographical coverage
PV Southern Europe contract covers; Italy, Spain, Portugal, The Azores, Greece, Turkey, Kosovo, South of France, Croatia, Slovenia, FYROM, Romania, Bulgaria Coast line of Mediterranean and Black Seas for ship support (6th fleet AOR) From Lajes AB to Incirlik AB  3,300 miles By Comparison Boston to SF  2,700 miles

6 Southern Europe-Locations
RP AP 4 Operational platforms : ITALY - Forli FYROM – Gevgelija SPAIN - Alicante THE AZORES - Isla Terceira CentralisedOrder processing & Customer service HQ in CH : to save money for the USG

7 Southern Europe Our daily challenges
Geographical coverage: Distance, border crossing issues, EU veterinary laws are not uniformly applied throughout Europe Customs and EU regulations All our warehouses are bonded: the goods stored for the US forces have the “in transit” status and cannot enter the EU market (US troops are our only customers) Full-time presence of Vets and regular customs inspections and different rules in different countries (Italy, Spain, Turkey, etc.) Small volume adds challenge to attain minimum order quantities imposed by manufacturers EFS’ order lead-time is days, navy ships place their orders 6 days before the RDD, regular customers 2 days Selected challenges

8 ….and more….. Iraq and Afghanistan wars have dramatically reduced full time presence of Navy Ships in the Mediterranean and Black Seas Navy Ships orders are highly unpredictable in terms of timing and volume Items ordered varies within the same class of ships and the crew on board The impact of Navy Ships’ orders increased over the course of the contract due to reduced volume from land based customers Selected challenges

9 …However… EFS demonstrated capability to quickly adapt to any new challenge Operation Iraqi Freedom (OIF) Operation Enduring Freedom (OEF) Operation Odyssey Dawn (ODD) ONGOING Selected challenges

10 Navy Ships/Land weekly orders
CASES 20K 15K 10K 5K Week #( January 2009-April 2011)

11 Case Study Operation Odyssey Dawn
OOD : Operation Odyssey Dawn was the U.S. code name for the US part of the international military operation in Libya to enforce United Nations Security Council Resolution 1973 during the initial period of March 2011 and afterwards under NATO command as Operation Unified Protector (OUP).

12 Case study OOD FIRST WEEK
March 2nd - DLA requested EFS to bring its inventory in line to support Navy Sales in the area of $7M per month DLA later revised the amount to $3.5M per month Following the guideline, EFS placed orders at 3 main suppliers In the first week, daily conference calls between DLA Troop Support and Ebrex were set in order to arrange for airlifts, as demand requirements due to Operation Odyssey Dawn are well above previous average demand

13 OOD / OUP Support Airlifts were organized and are still ongoing to expedite warehouse replenishment in addition to ocean transportation As of week 18: 7 airlifts

14 OOD / OUP Support Within 48 hours of surge warning from DLA, we doubled our average pipeline in terms of cases/dollar value To date, overall pipeline is approx. $15 million 500 % surge!! Week # Week # Typical level prior to OOD DLA surge warning DLA surge warning

15 OOD / OUP Support February-April 2011

16 OOD / OUP– Where we are going
Length and level of support is unclear Required support for Operation Unified Protector could end abruptly and/or be phased out The above results in a considerable financial risk for the company due to ; Huge levels of inventory currently carried to support the surge Shelf lives of the items US troops being our only outlet

17 OOD/ Keys for success Timely communication of headcount/menu changes = reduced number of NIS and expired items Navy ships orders placed with the longest possible lead-time can guarantee the availability of items with low historical demand Special communication line for: Challenges Contingencies Ensure that both surge/mobilization and demobilization are equally covered in the contract and support is equally provided

18 Conclusions A solid and well supported company
A 10 years proven record of experience Know-how in a vast and complicated geographical area Have met and dealt with all diverse and unpredictable arising challenges with exceptional results


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