Discount Retail Chain Lidl's (owned by the German Schwarz Group) controls via its shipping company Tailwind Shipping Lines its Asia-Europe supply chain. This allows it to gain efficiencies that are then translated into the final price for its consumers. The maritime subsidiary has already announced its intention to increase the service to third parties.
Tailwind Shipping Lines, Lidl's shipping company key to its 'hard discount' policy.
Schwarz's shipping company, Tailwind Shipping Lines, was created in July 2022 with the aim of directly connecting the German discounter's supply markets in Asia with its network of stores in Europe. This shipping subsidiary has played a crucial role in guaranteeing Lidl's supply chain, gaining efficiencies and lowering the final price for the German brand's consumer.
Now the shipping company wants to go a step further and increase the share of service it provides to third parties, so it has announced changes to its routes and schedules. Specifically, it has increased the frequency of its Tiger Express Service (TEX) service from Bangladesh in order to load more textile products, while its China-Europe service, Panda Express Service (PEX), has set a new stopover in Colombo, Sri Lanka's capital and most important port. With these adjustments, Tailwind plans to increase loads, attract third-party contracts and reduce unit costs, which should be reflected in the final price of the German discounter's products.
"Tailwind thus sharpens its profile as a premium service provider on the Asia-Mediterranean route. In addition to non-food goods for Lidl, we will continue to focus on third-party cargo," said Christian Stangl, CEO of Tailwind Shipping Lines.
A Rising Trend Among Retailers The pandemic and geopolitical tensions have caused severe damage to supply chains, prompting several trade and manufacturing giants to take control of their own logistics network. This is a trend that has been on the rise in recent years and experts expect it to continue to increase.
"Maritime services have lost reliability, which causes shortages of products on shelves and warehouses and affects the reputation of retailers and brands," say Olga Salvador (BCO's & Reefer Manager at the Port of Barcelona) and Carles Mayol (director of the Container Division at the same institution).
Coca-Cola and Ikea are two of the big global brands that have already taken control of their own supply chains. Among food retailers, Lidl is in the lead.
Tailwind Shipping Lines, Lidl Instrument Currently, Tailwind Shipping Lines has eight cargo ships divided into two services: the China-Europe line and the Bangladesh-Europe line, both with a duration of 19 days after the announced reorganization.
In order to ensure its efficiency, the company traces its routes with few stops. In addition, its relatively modest vessels (5,000 teu or containers) allow it to plan calls at less congested and more economical ports along major shipping routes, which in turn facilitates shorter response times and fewer delays.
Read more: Tailwind Shipping Lines, Lidl's shipping company key to its 'hard discount' policy (ampproject.org)
