A GCCA Program designed to provide justification during negotiations.
Negotiations for providing third-party logistics services such as storage and shipping of perishable foods between cold storage warehouses and customers have been challenged as arbitrary.
Achieving annual changes from customers reflective of the shifting costs of operating refrigerated warehouses can be challenging when using indices that do not accurately reflect the cold storage businesses.
In order to improve the economic information available to industry participants, the Global Cold Chain Alliance has created a Cold Chain Index (CCI). The Cold Chain Index is a customizable template that members can provide justification to their customers during negotiations.
The index tracks the growth rates of costs using predominantly official sources of economic data along with actual expense classes from the GCCA Productivity and Benchmarking tool. The CCI can be customized to the region and state where a warehouse facility operates and includes five classes of expenses: labor, electric power, supplies, repairs and rent.
GCCA Cold Chain Index – 2024 4th Quarter Update Now Available!
Download Q4 2024 Template to Insert Your Data
In order to improve the economic information available to industry participants, the Global Cold Chain Alliance has commissioned a Cold Chain Index (CCI), reported since the end of 2018. The CCI tracks the growth rates of costs associated with cold storage using predominantly official sources of economic data. The CCI can be customized to the region, state, and metro area where a warehouse facility operates.
The CCI includes five classes of expenses: labor, electric power, supplies, repairs, and rent; the cost shares typical of a North American refrigerated warehouse are shown in Figure 1. Expenses for refrigerated warehouses rose by 6.09% in the third quarter of 2024 relative to the same period in 2023. This increase was led by Labor costs, which accelerated at 7.66% followed by Rental costs for warehouses, which rose by 6.28% on a nationwide average in the third quarter of 2024 vs the same period in 2023. Members of the Global Cold Chain Alliance and their customers may access a template to better understand the index and customize cost shares to the experience of their business, and to account for variation across geographic regions.
Frequently Asked Questions
How does the Cold Chain Index differ from the PPI?
The PPI (Producer Price Index) measures how much an industry raises its prices on output. For example, if the PPI for the industry is up 3.2%, that is just passing through the cost increase that it faced (according to our CCI of 3.2% for the nation). If over a long period of time, we see a CCI that is lower than the PPI, that would suggest that the industry is absorbing cost increases rather than passing them through.
How do I set the template to my geographical location?
Step 1: Select region
Step 2: Select state
Step 3: Select metro area
How do I check the index for facilities in different regions, states or cities?
If you use the template for one region, then want to examine states and/or cities in aa different region; revise the region first and then be sure to revise the state and metro area selections accordingly because the template will not automatically reset.
What is the rationale behind the Cold Chain Index?
Cold storage warehouse rates are commonly questioned and/or challenged. The cold chain index is a customizable “rate builder” template that members can use to provide justification to their customers during rate negotiations. The index is based on published data from U.S. official sources and parameters obtained from the 2016 Productivity and Benchmarking Report.
What variables make up a rate?
Rates cover the variable costs of operations (labor, power, supplies, other inputs).
Rates contribute to the capital invested in the plant, property, and equipment.
Rates allow for return to owners’ equity and risk-taking (profit).
Where do the original Cost Share percentages come from?
Cost share percentages of Labor, Rent, Supplies, and Maintenance were derived from the input in to the GCCAs FY2018 Productivity and Benchmarking Report (PBR).