Supply chain management (SCM) is the management of a network of

interconnected businesses involved in the ultimate provision of product and

service packages required by end customers (Harland, 1996). Supply Chain
Management spans all movement and storage of raw materials, work-in-
process inventory, and finished goods from point-of-origin to point-of-
consumption (supply chain)

Activities/functions

Supply chain management is a cross-functional approach to manage the

movement of raw materials into an organization, certain aspects of the internal
processing of materials into finished goods, and then the movement of finished
goods out of the organization toward the end-consumer. As organizations
strive to focus on core competencies and becoming more flexible, they have
reduced their ownership of raw materials sources and distribution channels.
These functions are increasingly being outsourced to other entities that can
perform the activities better or more cost effectively. The effect is to increase
the number of organizations involved in satisfying customer demand, while
reducing management control of daily logistics operations. Less control and
more supply chain partners led to the creation of supply chain management
concepts. The purpose of supply chain management is to improve trust and
collaboration among supply chain partners, thus improving inventory visibility
and improving inventory velocity.

Several models have been proposed for understanding the activities required
to manage material movements across organizational and functional
boundaries. SCOR is a supply chain management model promoted by the
Supply Chain Management Council. Another model is the SCM Model proposed
by the Global Supply Chain Forum (GSCF). Supply chain activities can be
grouped into strategic, tactical, and operational levels of activities.

Supply Chain Management Problems

Supply chain management must address the following problems:

• Distribution Network Configuration: Number, location and network

missions of suppliers, production facilities, distribution centers,
warehouses, cross-docks and customers.
• Distribution Strategy: Including questions of operating control
(centralized, decentralized or shared); delivery scheme (e.g., direct
shipment, pool point shipping, Cross docking, DSD (direct store delivery),
closed loop shipping); mode of transportation (e.g., motor carrier,
including truckload, LTL, parcel; railroad; intermodal, including TOFC and
COFC; ocean freight; airfreight); replenishment strategy (e.g., pull, push
or hybrid); and transportation control (e.g., owner-operated, private
 carrier, common carrier, contract carrier, or 3PL). Trade-Offs in Logistical
Activities

The above activities must be coordinated well together in order to achieve the
least total logistics cost. Trade-offs exist that increase the total cost if only one
of the activities is optimized. For example, full truckload (FTL) rates are more
economical on a cost per pallet basis than less than truckload (LTL) shipments.
If, however, a full truckload of a product is ordered to reduce transportation
costs there will be an increase in inventory holding costs which may increase
total logistics costs. It is therefore imperative to take a systems approach when
planning logistical activities. These trade-offs are key to developing the most
efficient and effective Logistics and SCM strategy.

• Information: Integration of and other processes through the supply chain

to share valuable information, including demand signals, forecasts,
inventory, transportation, and potential collaboration etc.
• Inventory Management: Quantity and location of inventory including raw
materials, work-in-progress (WIP) and finished goods.
• Cash-Flow: Arranging the payment terms and the methodologies for
exchanging funds across entities within the supply chain.

Supply chain execution is managing and coordinating the movement of

materials, information and funds across the supply chain. The flow is bi-
directional.

Strategic

• Strategic network optimization, including the number, location, and size

of warehouses, distribution centers, and facilities
• Strategic partnership with suppliers, distributors, and customers,
creating communication channels for critical information and operational
improvements such as cross docking, direct shipping, and third-party
logistics
• Product lifecycle management, so that new and existing products can be
optimally integrated into the supply chain and capacity management
• Information Technology infrastructure, to support supply chain
operations
• Where-to-make and what-to-make-or-buy decisions
• Aligning overall organizational strategy with supply strategy

Tactical

• Sourcing contracts and other purchasing decisions.

• Production decisions, including contracting, scheduling, and planning
process definition.
• Inventory decisions, including quantity, location, and quality of inventory.
 • Transportation strategy, including frequency, routes, and contracting.
• Benchmarking of all operations against competitors and implementation
of best practices throughout the enterprise.
• Milestone payments
• Focus on customer demand.

Operational

• Daily production and distribution planning, including all nodes in the

supply chain.
• Production scheduling for each manufacturing facility in the supply chain
(minute by minute).
• Demand planning and forecasting, coordinating the demand forecast of
all customers and sharing the forecast with all suppliers.
• Sourcing planning, including current inventory and forecast demand, in
collaboration with all suppliers.
• Inbound operations, including transportation from suppliers and
receiving inventory.
• Production operations, including the consumption of materials and flow
of finished goods.
• Outbound operations, including all fulfillment activities and
transportation to customers.
• Order promising, accounting for all constraints in the supply chain,
including all suppliers, manufacturing facilities, distribution centers, and
other customers

GENCO Supply Chain Solutions

======History

The GENCO of today had its humble beginnings in 1898 as H. Shear Trucking
Company. Leading his horse and wagon through the streets, Hyman Shear
delivered commodities in Pittsburgh and surrounding communities. With the
advent of motorized vehicles, Hyman mechanized the business with the
purchase of his first gas-powered truck in 1917. Within a short period of time,
the company was operating a small fleet of trucks and servicing an expanded
area.

Historical Pittsburgh Following years of success, Hyman's son Sam ushered in

the company's second-generation of leadership in the early 1940s. Under a
new name, General Commodities Warehouse and Distribution Company, Sam
expanded the delivery fleet and added warehousing and distribution services.
Like his father before him, Herb Shear joined his father Sam in 1971, to
become the family's third generation involved in the logistics business.
Together, they expanded the company's service offerings to include public
warehousing, distribution and product manipulation services. Continuous
growth throughout the seventies and eighties expanded the company's
technology base and service offerings.

In the late eighties, Herb transformed product returns management by

developing a centralized returns process known today as Reverse Logistics.
Following development of its proprietary returns processing software and
product liquidation capabilities in the early nineties, the company began
providing Reverse Logistics to help customers manage and maximize the value
of their returned products.

In 1995, the company consolidated its divisions and service offerings under
one name, GENCO Distribution Systems. With a new focus, came new concepts
and innovative developments. The company continued its strategic expansion,
making several key acquisitions, including contract logistics and warehouse
management software development companies, to end the twentieth century
well positioned as a leading full service provider of supply chain solutions.

Over the past several years, GENCO has continued its growth by adding an
expanded range of service offerings, including transportation logistics, parcel
negotiation and audits, damage research, pharmaceutical services and
government solutions. In addition, the company formed a strategic LLC with
BDP International to provide end-to-end global supply chain solutions. In 2007,
the company changed its name to GENCO Supply Chain Solutions to better
reflect its complete range of service offerings.

As GENCO Supply Chain Solutions celebrates its 110-year anniversary in 2008,

it is recognized as North America's second largest and a Global Top 50 third-
party logistics and remains the clear industry leader in Reverse Logistics. While
the company continues its growth, many of the things that have made it
successful will remain the same, including a superior management team, the
supply chain industry's best professionals and best customer experience and
depth of technology innovation to deliver value-added solutions, which meet
the 21st century needs of its customers.

====GENCO Supply Chain Solutions at a Glance

Solutions at a Glance

* Magnifying Glass 111-year, privately held, non-asset based company

 * North America's second largest and a Global Top 50 third-party logistics
company
* Over 150 customers, including many Fortune 500 manufacturers and
retailers and U.S. government agencies
* 130 operations throughout U.S. and Canada
* Over 37 million square feet of managed warehouse space
* Over $722 million in annual sales
* Over 7,000 teammates
* Through 2008, $9.5 million savings with Six Sigma process improvements
* Recognized leader in Reverse Logistics
* Over $1 billion in freight managed annually
* Visibility to $2.5 billion in parcel freight
* Leading B2B wholesaler of surplus inventories, liquidating more than $5.2
million worth of merchandise daily

===GENCO's Mission, Vision and Values

1. To provide value to our customer and teammates

2. To be profitable

Our Strategic Vision

We are committed to provide the best non-asset based supply chain solution
experience for our customers and to be the productivity, data management
and innovation leader for our industry.

Our Values

We will continually strive for Better Practices in all of our business processes.

We will make and Keep Our Commitments to our customers, teammates,

business partners and shareholders.

We will behave in a Legal, Fair and Ethical manner.

We will show Respect for ourselves, other teammates and customers by being
prepared, open and honest, and by resolving conflict.

=======GENCO Awards and Recognition

GENCO Supply Chain Solutions’ reputation as North America’s second largest

and a Global Top 50 third party logistics company and the recognized leader in
Reverse Logistics are well documented.
GENCO Supply Chain Solutions has been recognized for its accomplishments
and success as a leading third party logistics company known for creating
initial and ongoing value, and providing the industry’s best customer
experience.
Top 36 North American 3PLs
Logistics Quarterly
November 2008
Top 20 North American 3PL Warehouse Operators
Modern Material Handling
November 2008
Top 50 Logistics Providers
Logistics Management
August 2008
100 Great Supply Chain Partners
Global Logistics & Supply Chain Strategies
July 2008
Top 100 3PLs
Inbound Logistics
July 2008
Sears’ Partners in Progress Award
Top 1% of Sears’ Vendors
1994-2008
Salzberg Medallion Award
Martin J. Whitman School of Management at Syracuse University
Gus Pagonis
April 2008
Readers’ Choice Awards
Consumer Goods Technology
January 2008

=====Charitable Giving

At GENCO, caring about our communities is at the heart of our philanthropic

philosophy. We know we can make the greatest impact on our community by
supporting causes that are important. We are proud to help support charitable
and community-focused organizations through a combination of charitable
donations and sponsorships that drive positive change where it is needed
most.

PittsburghGENCO contributions and sponsorships include:

* Greater Pittsburgh Community Food Bank

* Make-a-Wish Foundation
* The United Way Foundation
* POWER
 * March of Dimes
* West Pennsylvania Conservancy
* Three Rivers One Future
* Ronald McDonald House
* The Mario Lemieux Foundation
* Susan G. Komen Race for the Cure
* Pittsburgh Jewish Foundation and others

======
Consumer Product Goods Industry Profile

Consumer packaged goods (CPG) manufacturers are faced with a variety of

market pressures - demanding consumers, dominant retailers and
globalization. While the CPG manufacturing industry is large and successful,
margins are shrinking and competition is intense. With hundreds of product
categories and globalization, CPG manufacturers must constantly innovate to
compete.
Supermarket aisle

To remain competitive, CPG manufacturers must address supply chain

obstacles, including operational inefficiencies, dealing with vendor managed
inventories, lack of inventory visibility and getting new products to market
faster and more efficiently.

GENCO Supply Chain Solutions provides supply chain management solutions

for many leading CPG manufacturers. The company provides an "all-in-one"
solution that creates a competitive advantage through increased efficiencies,
optimized productivity and continuous improvement opportunities by
integrating proven processes, innovative technologies and Six Sigma
applications.

GENCO Supply Chain Solutions all-in-one solution allows customers to realize a

return on investment in the form of improved product flow, reduced operating
costs, improved inventory management, increased visibility and flexibility to
adapt to changing market needs.

=======
Electronics Industry Profile
Many consumer electronics companies struggle with inconsistent execution
between distribution and return centers which leads to wide variations in
operational performance and affects profit potential. Manufacturers, suppliers
and retailers express concern over poor quality control on shipments and
handling. Lengthy processing times tie up inventory, limit buyers' purchasing
potential and contribute to reconciliation issues which delay receipt of credits.
With little Couple looking at big screen televisions collaboration and data
exchange, there is limited visibility given to returns.

GENCO Supply Chain Solutions reverse logistics process can decrease returns
processing cost-per-unit by 50 percent. The company's supply chain analyses
and implementations significantly reduce transportation costs by increasing
the number of full truckload shipments. GENCO Supply Chain Solutions can
reduce the timeframe for returned goods final disposition by 75 percent while
increasing inventory turn rate from 12 to 24 percent. The company's
proprietary return system removes internal resource constraints. Reporting
and process standards are shared between suppliers and retailers to alleviate
reconciliation issues. Retailers, suppliers and manufactures benefit from a
significant improvement in "open-to-buy" availability. GENCO Supply Chain
Solutions' ongoing collaborative Six Sigma process focuses on reasons for
returns and efficiencies across the supply chain from point of manufacturer
through final disposition.

A growing opportunity for improving competitiveness and profitability can be

found in areas related to reintroducing returned products into sales or
manufacturing channels. GENCO Supply Chain Solutions' centralized reverse
logistics and distribution approach makes it easy to repurpose goods, in whole,
through online and traditional brick and mortar sales channels or as harvested
parts into the manufacturing stream.

=====
Food and Beverage Industry Profile

Food & beverage companies are faced with market challenges driven by the
slow industry growth, margin pressures and a marketplace crowded with new
product introductions, which makes it difficult to differentiate and build brand
value. Many food & beverage companies realize that an efficient supply chain
can provide a competitive advantage. Person picking up an orange juice carton

GENCO Supply Solutions understands the challenges food & beverage

manufacturers face with their overall supply chains. Their networks must
support a diverse customer base, various product forms, unique rotations and
freshness constraints while satisfying environmental and shareholder interests.
GENCO Supply Solutions helps customers resolve these business challenges
and realize the best return on their supply chain investment. In addition to
warehousing and distribution, GENCO Supply Solutions understands the added
dimension of customer guarantee days as it relates to product freshness. The
element of time sensitivity goes beyond handling dated products. It includes
understanding individual customer requirements. GENCO Supply Solutions
effectively manages this aspect of distribution, demands an operations and the
systematic commitment to delivering products that meet customers' product
freshness requirements.

Operating a food & beverage supply chain can places a huge demand on both
capital and environmental resources. GENCO Supply Solutions' commitment to
ongoing supply chain improvements drive continual innovation that saves
customers money and enhances sustainability. GENCO Supply Solutions boasts
one of the supply chain industry's largest Six Sigma certified management
teams. The company invests heavily in process improvement throughout its
facilities to control costs and reduce waste.

GENCO Supply Solutions' comprehensive knowledge of food & beverage supply

chains has made it a leader in the development and administration of
unsaleables policies. Embracing a commitment to shared responsibility,
GENCO Supply Solutions develops programs that drive waste from the supply
chain while appropriately holding trading partners accountable. The goal is an
overall reduction in waste with an overriding improvement in customer service
and ultimately consumer satisfaction.

=====
Government Industry Profile

Achieving critical supply chain and operational missions for U.S government
agencies, whether military or civilian, requires a proven "best-in-class" solution
supported by a superior performance. Challenged with expanding and
increasingly complex supply chains and reduced operating budgets, private-
sector support has become an integral part of the U.S. government's success.
Military Base

GENCO Government Solutions, a division GENCO Supply Chain Solutions,

specializes in warehousing, distribution and base operations in support of U.S.
government agencies and the warfighter worldwide. The company's success
stems from its diverse and complementary combination of military,
government and private-sector experience. As a non-asset based company,
GENCO Government Solutions employs creative contracting methods,
commercial best practices and innovative technologies as long-term cost-
effective solutions.

====
Medical Device Industry Profile

As the medical device industry continues to expand, companies are searching

for ways to become more competitive. Medical device manufacturers are faced
with intense competition, increasing regulatory pressures, shorter product life
cycles, rapid new product introductions, globalization and higher quality
standards. As a result, there is an increased focus on creating efficiencies in
the supply chain similar to other industries. Dental equipment

GENCO Supply Chain Solutions' experience, innovative technologies and

proven best practices improve service levels while reducing inventory and
labor costs. In the process, customers gain end-to-end visibility to align their
corporate business strategies and processes to their global supply chains.

GENCO Supply Chain Solutions' expertise with numerous supply chain

technologies helps customers automate high volume, labor intensive and error
prone processes. The company remains current with RFID advancements and
E-pedigree standards. GENCO Supply Chain Solutions' proprietary warehouse
management system provides visibility and compliant reporting in the form of:

* Fully traceable device history to track throughout the supply chain

* Information capture and storage, including lot and date code tracking and
expiry dates all supported by full quarantine and recall capabilities
* Customer-specific electronic reports.

GENCO Supply Chain Solutions has extensive experience managing

conventional, secured and temperature-controlled warehouses, incorporating
superior health and safety measures. All of the company's systems are
validated according to FDA regulations and adhere to GMP guidelines.

=====
Pharmaceutical Industry Profile

Pharmaceutical companies have entered a difficult period where shareholders,

the market and regulators have all created significant pressures for change
within the industry. From thinning pipelines and skyrocketing operating costs
to calls for lower prices and a greater regulatory burden, pharmaceutical
companies are confronted with unprecedented challenges that are expected to
radically transform the industry. To overcome these challenges,
pharmaceutical companies require a bold vision and leadership willing to
embrace fundamentally new approaches to their businesses, including
pharmaceutical returns and recalls. Pharmaceutical products in blister packs
As the industry leader and innovator, GENCO Pharmaceutical Services,
formerly Capital Returns, has transformed pharmaceutical returns into a data-
rich, systematic process that drives critical information and value back to
manufacturers, pharmacies and wholesalers. GENCO Pharmaceutical Services
sets the standard for delivery and service excellence using industry-leading
technology and reporting tools to provide pharmaceutical companies with the
most precise and timely pharmaceutical returns and recall management
solutions.

Overseeing every step of reverse distribution, GENCO Pharmaceutical Services

delivers accurate returns data and highly responsive customer service.
Providing strategic data management throughout the returns life cycle, GENCO
Pharmaceutical Services delivers valuable information and insight that makes
today's pharmaceutical companies better businesses.

Today, many of the largest pharmacy chain operators, pharmaceutical

manufacturers, PBMs, drug wholesalers and independent pharmacies turn to
GENCO Pharmaceutical Services for timely and cost-effective solutions that
bring transparency and business value to every stage of the return cycle.

======
Retail Industry Profile

Today's retail industry is focused on being better, faster and leaner. Retailers
are challenged with a faster-paced society and faster-paced technology
changes. At the same time, overall inventory pressures are mounting, too.
Larger retailers, with their efficiencies of scale and global scope, are driving
prices down and reducing margins. Shoppers looking at retail clothing

GENCO Supply Chain Solutions provides retail supply chain management

solutions for both forward and reverse supply chains. The company has
created a seamless product flow that tracks and manages each customer's
products from point of order, regardless of source, through disposition of
returned items.

With each new retail distribution and return center operation, GENCO Supply
Chain Solutions integrates process improvements by continuously enhancing
its systems, technology and operations. In the process, GENCO Supply Chain
Solutions has uncovered billions of dollars in hidden profits for some of the
world's biggest retailers.

GENCO Supply Chain Solutions experience helps retailers manage their supply
chain processes so they can:

* Fulfill the right product at the right time

 * Employ inventory controls to insure product availability
* Reduce transportation costs
* Eliminate in-store labor hours
* Increase available space in stores and distribution centers
* Leverage better terms with vendors and suppliers
* Achieve end-to-end supply chain visibility and analysis.

=====

Second Largest Third Party Logistics, 3PL, Provider in North America

GENCO Supply Chain Solutions > North America's 2nd Largest 3PL

GENCO Supply Chains Solution is a Global Top 50 and North America's second
largest third party logistics company. GENCO is a privately owned 110 year old
company.
3PL Services

GENCO is world renown as a leader and innovator of reverse logistics solutions.

In fact, GENCO offers a full range of third party logistics solutions that
eliminate waste and maximize profits within the supply chain.

Our contract logistics solutions emphasize highly efficient warehouse

management and distribution centers. Transportation logistics enables the
delivery of truckload, LTL and parcel delivery throughout North America.
GENCO's reverse logistics solutions offer more than return center operation
into service such as product liquidation and damage analysis. GENCO Supply
Chain Solutions provide initial and on-going value throughout the supply chain
by maximizing efficiencies and eliminating waste.
GENCO's Supply Chain Technology

GENCO's RFID and our award Technology that improves the supply chain
winning optically enabled RTLS allow tracking of inventory from the moment
inventory enters a warehouse.

GENCO uses its stature to partner with other technology companies to bring
the most innovative supply chain technologies to our customers. We partner
with Manhattan Associates to provide Tier 1 logistics and warehousing
solutions at highly competitive rates. Our partnership with Sky-Trax produced a
first-runner-up award for Supply Chain Innovation at CSCMP for our optically
enabled RTLS system.
Our Customers

GENCO provides services to a wide range of customers across many verticals.

In fact, we currently have over 150 customers, including many Fortune 500
manufacturers and retailers, and U.S. government agencies. GENCO has entire
divisions that work exclusively with government solutions and pharmaceutical
services. We have extensive experience working in industries such as

* Consumer Product Goods

* Electronics
* Food & Beverage
* Government
* Medical Devices
* Pharmaceutical
* Retail

====
3PL Solutions Lead to a Green Supply Chain

Creating a green supply chain means both adding more green to the bottom
line as well as doing business in an Earth friendly manner. The third party
logistics services available through GENCO Supply Chain Solutions will help you
meet both your financial and environmental goals.
Transportation Management

One of the best ways to reduce your carbon footprint is through efficient
transportation management. Choosing an effective shipment method isn’t
always obvious. GENCO’s Transportation Logistics division can help you
determine when full truckload, LTL or parcel delivery services make the most
sense for your organization.
Supply Chain Network Optimization

Supply chain network optimization can be used to reduce the need for
transportation services. Which makes better sense:

* Transporting smaller quantities of product more frequently

* Making one large delivery less often.

GENCO’s supply chain network optimization services will identify the strategy
you need for green success.
Eliminate Unsaleables

There is no greater waste than transporting product that is unsaleable.

Damaged products need to be returned. Spillage from leaking products can
lead to environmental issues, not to mention resources needed for cleanup.
Damage analysis audits will identify and offer recommendations that will
significantly reduce unsaleables. GENCO’s Damage Research division finds
ways to drive cost and waste out of the supply chain. The results are a more
eco-friendly and cost effective supply chain.
Reduce, Reuse, Recycle
One of the easiest ways to green the supply chain is through reverse logistics.
A percentage of your product is going to be returned. Whether the product is
damaged or just unwanted, good use can be made of it. Damaged products
can be repaired or refurbished, then placed back into the market. GENCO
Marketplace offers product liquidation services that return unwanted, repaired
and refurbished merchandise back into the sales cycle.

Business decisions are most likely going to made based on the bottom line.
Using GENCO’s 3PL services unites the desire to act more environmentally
friendly with the need to improve a company’s financial status.