ifwla - Warehousing and Logistics International

8 Conference ReportUntapping the supplychain potential ofSri LankaThe Chartered Institute of Logistics & Transport – Sri Lanka’s recent annual conference showcased thevalue of logistics and the untapped potential of logistics and supply chain in Sri Lanka. H Nilès PererareportsChartered Institute of Logistics & Transport– Sri Lanka (CILT-SL) hosted its annualInternational Conference in Colombo onthe 28th October 2011. Choosing “Success ofDelivery” as the theme for the day, the eventshowcased the value of logistics and theuntapped potential in logistics and supply chainin Sri Lanka.The International Conference unfolded in front of apacked house with the participation of distinguishedguests ranging from the President of Chartered Institute ofLogistics & Transport International, Professor Alan WallerOBE to government ministers. Six presentations were madeduring the course of the day on how logistics has helpedthe growth of six different fields, namely retail chain, airline,garment manufacturing, Business Process Outsourcing(BPO), shipping and academic sectors.According to the Chief Guest, Dr. SarathAmunugama, Senior Minister in International MonetaryCo-operation, the government is committed to makingSri Lanka the “Miracle of Asia” by 2016 by making it aregional hub in five disciplines including maritime andair. The world’s busiest seaway falling a few nauticalmiles away from the Sri Lankan shore was cited as oneof the key ingredients in transforming Sri Lanka to thesaid hub status. Dr. Amunugama also praised theChinese Premier Wen Jiabao’s vision of making transport& logistics a driver of China’s growth, and elaboratedthat the Sri Lankan government plans to followthe example. He was very appreciative of CILT-SL andits commitment to taking logistics & supply chain in SriLanka to a higher level. He wanted the CILT-SL to be akey player in guiding and supporting the country inbecoming a logistics hub in the near future. The seniorminister went onto say “in this case, logistics and transportbecomes absolutely crucial – we need to reformand improve the transportation sector for our countryand we look forward to even greater cooperation andachievement from CILT-SL in the future”.Professionalism in Supply ChainProfessor Alan Waller OBE, the President ofChartered Institute of Logistics & TransportInternational delivered the keynote address of the day.He highlighted the value of CILT Sri Lanka to CILTInternational and the importance of developing professionalismin this budding field. It was his opinion thatCILT has a major role to play in doing so andexpressed great joy about the steps taken by CILT-SL inthis regard.Professor Waller discussed how globalisation and competitionhas influenced the boom of the Supply Chainindustry at large, which has become a game changer inthe modern world. This has created newer global marketswith added demands from the customers. He reiterated thefact that supply chain should be seen as a value addingfunction rather than a necessary evil which eats into anorganisation’s profit margins.He went on to say “the concept of the free movementof goods, people and money is a regional modelclearly replicated in other areas and Europe has certainlyled the world in developing a seamless logisticsIssue No. 3www.ifwla.com

Conference Report 9capability” citing that Sri Lankacan use the blueprints set byEurope in its quest to become alogistics hub. Professor Waller wasalso confident that the presentEurozone crisis was only a blip in theradar and will not affect the growth ofthe supply chains the world over.Sustainability of business was cited as a majorconcern with the recent green wave that has arisenin the world. But Professor Waller was clear that it doesnot mean “hugging trees”. He spoke about giving morepower to supply chain managers across organisationsto perform in their roles. He presented his findings onhow a supply chain expert with good communicationand leadership skills can innovate while finding hithertounseen solutions to add value to the organisation.Logistics in Retailing: Key for SuccessNext up was Ranjit Page, Managing Director &Deputy Chairman of Cargills (Ceylon) PLC, ownerof Cargills Food City. In his presentation “‘Logistics inRetailing: Key for Success” he spoke about the criticalrole of logistics, not only in the success of the company,but also in empowering the farming communitiesacross the nation. Mr. Page elaborated on how heembarked on implementing logistics in 1999 to sustaina retail chain that was running with low returns despitethe opposition from within the organisation. He highlightedwastage of produce during transport as a blackhole that many organisations fail to see. It was thisunderstanding that drove Page and Cargills to collectproduce straight from the farmers by establishing collectioncentres. Cargills did not stop there. They wenton to distribute plastic crates among the farming communitiesto reduce wastage during transportation to thecollection centres. Cargills had to facestiff opposition from the established cartelsand middlemen in its journey to the top, includingthe bombing of one of its retail stores, but Page stoodtrue to cause as he felt “Cargills was notdepriving anybody”.Cargills has gone beyond being just aretailer to being a manufacturer. According to Page,“no retailer in the world today to my knowledge getsinvolved in manufacturing, but we have done it in SriLanka and through it we have been able to ensure thatthe wastage that happens along the supply chainbetween the farmer and the consumer is reduced. Wecreate processing value addition, the value we bring tothe farmers and to the consumers”. In addition to thisthe extensive research and development work and themodern information technology utilisation has madeCargills a major player in the Sri Lankan economy. Thiswas further emphasised when Page disclosed thatCargills amounts to 1.7% of the national agriculturalproduce which can be bought at a static price across171 stores located across the island republic.Page made it very clear that Cargills is not a charity,and are concerned about their bottom line. However,Cargills’ aim was to earn good profits while doing justiceto its suppliers as well as consumers by streamliningits supply chain. Page remarked that the purpose ofCargills is to “help Sri Lankans spend less on food” ashe closed his presentation emphasising that the futuresustenance of food lies with supply chain managementand reduction of wastage.Success of Air Hub: Need for IntegrationG.T. Jayaseelan, Chief Marketing Officer of SriLankan Airlines delivered his thoughts on how tomake Sri Lanka a regional air hub. He highlighted thewww.ifwla.comIssue No.3

10 Conference Reportclose knit relationship between tourism and the growthof air traffic in Sri Lanka. The government plans toattract 2.5 million tourists by the year 2015 puts inplace many challenges to Sri Lankan Airlines, thenational carrier, which accounts for approximately halfthe passenger movement to and from Sri Lanka. Hewent on to share how Emirates had played a criticalrole in making Dubai the undisputed aviation hub ofthe Middle East since its inception in 1985 and showcasedthat Sri Lankan Airlines could be the catalyst thatmakes Sri Lanka the undisputed aviation hub in theIndian subcontinent.Mr. Jayaseelan also remarked that the rapid growthof the Indian and Chinese markets pose a great opportunityfor Sri Lanka to become an aviation hub by puttingthe required infrastructure in place.Three important ingredients indentified, to attain thehub status were - coordinated schedule, strategic locationand good airport facilities. Unlike the success storiesin Frankfurt Am Main and London, Sri Lanka wishesto entwine tourism as a key player in becoming anair transport hub. The flight schedules of Sri LankanAirlines need to be revised so as to allow foreign transitpassengers to use Sri Lanka and Sri Lankan as theirpreferred transit airport and airline.ABOVE:In order to achieve that, Sri Lankan Professor Alanis also planning to work closely with Waller OBE, theMihin Lanka, the government owned President ofbudget carrier, to facilitate seamless Charteredtransfers. Sri Lankan has already set Institute ofinto motion an aircraft replacement Logistics &programme where they are procuringstate of the art Airbuses to InternationalTransportincrease the frequency and destinationscovered by the national carrier. ered the(right) deliv-Jayaseelan stated that thekeynoteBandaranaike International Airportaddress of thein Colombo should take steps today.face the imminent capacity crunchbeyond 2011 while praising theconstruction of the island’s second international airportwhich is being built in the outskirts of Hambantota inthe deep south of the country.Jayaseelan conceded that Sri Lankan has failed tomake significant inroads in the recent increase of passengernumbers at the airport but reiterated that theywill try harder. Sri Lanka’s strategic location near India,China and Indonesia was cited as a big advantage notIssue No. 3www.ifwla.com

12 Conference Reportonly in becoming a transit point but also as a touristdestination. Sri Lankan is planning a major expansionin 2016 to target all these market segments.The Chief Marketing Officer also pointed out thateffective rail and road linkages are of great importanceto making the hub strategy a reality. However whenasked whether Sri Lankan would work in tandem withother institutions to make the rail and road links a realityhe reiterated that Sri Lankan had decided to stick toits core business for the time being and establish itselfas a preferred airline in the aviation industry.Speed to marketMahesh Amalean, Chairman of MAS Holdings, aChemical Engineer who turned the family knittingbusiness into a US$ 970 million revenue per annumentity was the next to preside the lectern. He started offby conceding that he had very little regard for logistics& supply chain and its importance to the business whenhe began a few decades ago. Amalean went on toshare how he stumbled across the fact that logisticscould be used for MAS’s advantage rather than consideringit a necessary evil. Presently MAS Holdings, whichis a key supplier of world renowned brands such asVictoria’s Secret, Nike, Marks & Spencers and manyother iconic fashion brands, considers logistics and supplychain as one of its core competences. The value oflogistics and supply chain is such that MAS has managedto stamp a regional & global presence in therecent years, especially by investing in plants in India,China & Bangladesh and offices in London, New York& Hong Kong.Amalean laid emphasis on the part supply chain &information technology has to play in the success of amodern day organisation and commended the roleplayed by CILT-SL in promoting these aspects amongthe industry. He elaborated on how MAS considersinnovation a key part of its success adding that investingin talent, training & development and R&D being ofgreat importance. That, along with its strong values,has made MAS one of the most sought after employersamong the youth of Sri Lanka.As part of the presentation, Amalean highlighted thecompany’s commitment towards the development of SriLanka. He was very proud to share that MAS was planningto launch two production plants in Kilinocchi, inthe Northern Province, thereby creating much neededemployment among the youth of the war ravishedregion as well as being a welcome addition to thecountry’s insurgent economy. Amalean also spokeabout how MAS stood with Sri Lanka in the darkesthours of the nation, such as the Asian Tsunami in 2004.None of this would have been possible if MAS chose tostick with manufacturing excellence instead of usingnew concepts such as supply chain to streamline operationsand increase profitability.Amalean revealed how the introduction of MASOperating System, which was inspired by a visit toJapan to witness the streamlined operations at manufacturingplants, helped them to emerge from the globalfinancial crisis without any major setbacks.MAS changed its philosophy drastically and usedsupply chain as a vantage point to build relationships.Amalean remarked “We localised regions, changed oursuppliers and took control and managed our productright from the doorstep of our supplier. At the sametime we looked at how we can reduce the outwardbound speed at which we took our goods to our customers.The customers played a larger role as it wastheir need, but, we engaged with them to expedite theoutward bound service”. In addition, MAS introduced ademand pull strategy which further streamlined operations.These measures helped reduce the internalprocesses at MAS by reducing the average productiontime of over 50 days to somewhere between 14-18days. This was a major achievement for MAS as it wasa critical success against the Chinese manufacturerswho were threatening to eat into MAS’s business.In 2008 MAS had 44 customers, however today theyhave only 16 customers. By having a narrow marketand penetrating deeper into it, MAS has strengthenedits ties to its customers and shared a larger percentageof its supplier needs. Amalean reiterated that to be thebest in class the organisation needs to constantly adaptto be aligned with the requirements of the customer.Amalean called for reforms in the Sri Lankan logisticssystem, including the formation of a new regulatorybody to oversee logistics. He observed that the CustomsOrdinance of the country needs to be revised to facilitateseamless goods movements. Another point thatreceived the scrutiny of Amalean was the lengthypaperwork required in Sri Lanka to clear or exportcargo. This was cited as a major step, if taken, to thebenefit of all stakeholders involved in the trade.Amalean elaborated on Sri Lanka’s “tremendousopportunity” to become a regional apparel centre andthat MAS was willing to take the initiative given that thenecessary groundwork is available.What is Success?: Logistics in BPOsAfter a brief recess for lunch the InternationalConference recommenced with the presentation ofDr. Arul Sivagananathan, Managing Director of HayleysBusiness Solutions International.Sri Lanka was revealed as one of the growing BPOdestinations in the world, but Dr. Sivagananathan wasquick to add that Sri Lanka only had a 0.1% share ofthe global industry that was worth US$ 450 billion in2010. While Sri Lanka has lagged behind, countrieslike Philippines and Vietnam have made major stridesin increasing their BPO market share. Although Dr.Sivagananathan conceded that BPOs will not createIssue No. 3www.ifwla.com

Conference Report 13many millions of jobs, it was cited as an industry whichyields high revenues. He went on to remark that BPOsare an area which tends to grow in times of a recessionor economic crisis. Dr. Sivagananathan laid down thatSri Lanka will require increased infrastructure, governmentsupport and service maturity in order to establishitself as a serious BPO destination.He also quoted that the lack of the required skills,outside Colombo, was a cause for concern for theindustry despite the opportunities. Another key factorfor the growth of the industry is high quality IT infrastructurethat would facilitate the high speed turnaroundtime of the industry. The importance of a strongtransport infrastructure was also cited as a key requirementfor growth as a predominant share of the work iscarried out at night where over 50% of the employeesare females. Dr. Sivagananathan also pointed out thatin other countries BPOs are operated via the internetfrom the homes of the employees but Sri Lanka is yet toembrace this philosophy which will bring down embeddedcosts drastically. This stands to give a cost advantageto the Sri Lankan BPO industry if implemented.Hayleys has recently set up its first BPO centre inJaffna, the capital of the once war torn NorthernProvince and urged the government to provide specialincentives to take BPOs to places outside of the commercialcapital Colombo.It was pointed out that parallels should be drawnfrom countries such as China and Philippines whereregulation and investment in the IT sector and establishmentof IT Parks laid foundation to success. This wassuggested as a necessary step to further consolidate thebearing of the local BPO market. Dr. Sivagananathanwas optimistic that by carrying out the suggestedchanges and with a labour law change to facilitatefewer holidays and giving females the freedom to workduring night shifts Sri Lanka can go a long way inbecoming a BPO hub in the years to come.Dr. Sivagananathan’s presentation opened eyesamong many who had not thought of BPOs as anindustry that relies heavily on logistics.What it takes to be the Number One?: The Pastand the FuturePrithwijit Maitra, Senior General Manager of MaerskIndia Cluster Operations was the next on hand todisseminate his knowledge on the challenges in theshipping industry.www.ifwla.com Issue No. 3

Advertorial 15www.intlcargo.usInternational CargoJim Martin gives an insight into the companyINTERNATIONAL CARGO wasformed at the beginning of thenew Millennium by a team ofseasoned freight professionals who,between them, possess over 110years of combined experience in themulti-global freight industry. Allshare the same approach tobusiness ethics, the same positiveattitude towards developing andmaintaining a range of servicesdesigned to ensure customersatisfaction.Through its U.S. based operation, andthrough an independent worldwide networkof agents and partners, INTERNATIONALCARGO offers a multitude of logisticssolutions.• Export• Import• Air• Ocean• Overland• Customs Brokerage• Warehousing• Documentation• InsuranceThe options are many and varied.Questions asked by the WarehouseInternational editorial team:Tell us Jim what is your role in the company.PARTNER IN THE BUSINESS , SALES ANDMARKETING IS THE ROLEWhat specialist services do InternationalCargo offer its clients?DDU/PACKING/WAREHOUSE/ PROJECTWORK/WE THINK OUTSIDE THE BOX ALLTHE TIME, DOMESTIC TRUCKIN / GOVPROJECTS / SERVICE ALL THE US BASESEACH DAY/BIG INTO VEHICLES / TRUCKAND CARS .From your experience what should acustomer expect from its logistics/ freightsupplier?ONE PHONE CALL IT DOES IT ALL, DONTHAVE TO WORRY , WE WILL TAKE CAREOF EVERTHING: ‘’ YOU DO WHAT YOUDO AND WE DO WHAT WE DO’’How long how has International Cargo’ssister company, Fast Track Logistics, beenoperating and what are its specialist areas?8 YEARS SPECIALSIE IN FTL/GOVAUTIONS/ PACKING AND SHIPPINGWhat future challenges can you see for thesector and how are International Cargopreparing for these?WE ARE SMALL AND FLEXIBLE ENOUGHTO BE ABLE TO MOVE WITH THE TIMES,WE WILL DO ANYTHING TO GET OURCUSTOMERS TRUSTINTERNATIONAL CARGO can also offer,through its sister company, Fast TrackLogistics, domestic US transportationservices, go to www.fasttracklogistics.netAnd your background in the freight sector?28 YEARS IN THE GAME, SPENT 26 YEARSIN USA PROMOTING BUSINESS BETWEENUS / UKwww.ifwla.com Autumn 2011

16 Financial ReportsWith the latest financial reporting season upon us, Analytiqa’s Mark O’Bornick has taken a look atthe results of some of the world’s leading 3PLs to identify the latest trends and performance issues intheir contract logistics operationsMixed resultsChallenging market conditions inFrance led to margin pressure atKuehne + NagelIn the first nine months 2011, the Kuehne + NagelGroup delivered stable results despite divergent economicconditions and slowing market growth. Netearnings improved by 1.1% (currency adjusted: by15.6%) whilst EBITDA was 2.4% below (currency adjusted:11.5%) the figure of the previous year’s period.Turnover decreased by 3.8% (currency adjusted:increased by 10.1%) to CHF14,598.0 million.In Contract Logistics, net invoiced turnover declinedby 5.7% (currency adjusted: increased by 7.9%). Thefocal point of the business unit’s strategy has been theexpansion of services for multinational customers andthe consolidation at strategic logistics hubs. The integrationof contract logistics services into end-to-endsolutions has been an integral part of this strategicapproach. The challenging market conditions in Franceled to margin pressure, restructuring measures and anegative impact on results. Compared with the previousyear’s period, EBITDA in contract logistics was reducedby 11.5%; currency adjusted it remained stable. TheEBITDA margin decreased from 4.1 to 3.7%.Continued upward trends in logisticsat Norbert DentressangleQ3 at Norbert Dentressangle saw the Transport andLogistics businesses demonstrating satisfactoryorganic growth, with the Freight Forwarding businesson track to generate euro 100.0 million in annual revenue.The Company’s operating margin continues toimprove, with a strong like-for-like performance. In thefirst nine months of 2011, Norbert Dentressangle’sconsolidated revenue totalled €2,640.0 million, up24.9% on a published basis and 6.1% on a like-for-likebasis.Logistics revenue grew 25.8% on a published basis,to reach euro1,155.0 million, thanks to the integrationof TDG, which continued to increase its contribution toNorbert Dentressangle’s revenue stream following itsconsolidation into the Group as of 1 April 2011. On alike-for-like basis, logistics revenue at NorbertDentressangle increased by 4.1% in the first ninemonths of 2011, with a continued uptrend reportednotably in the UK, Norbert Dentressangle's leadinglogistics market. Q3 Logistics revenues grew 33.2% onthe same period of 2010, to reach euro424.0 million,representing 3.8% organic growth.Higher volumes and new businessboost operating revenue at RyderIn the US, Ryder System, Inc. has reported Q3 earningsfrom continuing operations of US$56.9 million,up 44.0% from the year-earlier period. Total revenuefor Q3, 2011 was US$1.57 billion, up 19.0%, reflectingthe benefit of acquisitions and organic growth.In the Supply Chain Solutions (SCS) business segment,Q3, 2011 total revenue was US$406.1 million,up 26.0% from the comparable period in 2010.Operating revenue (revenue excluding subcontractedtransportation) was US$326.8 million, up 26.0% comparedwith the same quarter a year ago. SCS total revenueand operating revenue comparisons benefitedfrom the acquisition of Total Logistic Control (TLC) inDecember of 2010. Operating revenue also benefitedfrom higher volumes and new business.The SCS business segment’s pre-tax earnings in thethird quarter of 2011 were US$22.4 million, up 47.0%from the same quarter of 2010. The improvement wasdriven by the TLC acquisition, higher volumes and newbusiness, partially offset by increased compensationrelatedexpenses.DSV sees excess warehouse capacitycontributing to fierce pricecompetitionFor the nine month period to 30 September 2011,DSV reported a 4.2% increase in revenue, reachingDKK32,787.0 million. Operating profit before specialitems (EBITA) increased 12.1%, corresponding to anEBITA margin of 5.6% (2010: 5.2%).In the Solutions division (contract logistics), operatingprofit before special items increased 5.1% in 9M, 2011through organic growth. Increased demand for warehousesolutions continued, but excess capacity stillcaused fierce price competition. Revenue in the divisiongrew by 2.1% over the same period of 2010 to reachIssue No. 3www.ifwla.com

Financial Reports 17DKK3,738.0 million (DKK3,434.0 million excludingintercompany revenue), as the EBITA margin reached5.5% in 9M, 2011, against 5.3% in 9M, 2010.Q3 saw good and stable results in the Solutions division,with particularly strong performances fromBenelux, Italy and Sweden. The division is rolling out anew IT platform which will increase productivity andefficiency and it also has a strong pipeline of customers,especially in the pharmaceuticals sector in theBenelux and France, and the electronics sector in theBenelux region.Asia-Pacific, Life Sciences &Healthcare and Automotive drivegrowth at DHL Supply ChainDeutsche Post DHL boosted revenues and significantlyimproved its profitability in Q3, 2011.Compared with the previous year, Group revenuesincreased by 2.5% to euro13.1 billion between July andSeptember. All of the Group's divisions contributed tothe Company's strong performance:At euro3.3 billion, revenues produced by the SUPPLYCHAIN division during Q3, 2011 remained at lastyear's level. However, this figure reflects the division'sactual operating performance only to a limited extent.Adjusted for exchange-rate and consolidation effects,such as the divestment of a subsidiary in the US thatwas not part of the division's core business, revenuesgenerated by the SUPPLY CHAINABOVE:division actually rose by 6.2% duringQ3.Group’s transfor-WincantonGrowth was fuelled in particular mation from aby significant growth in the Asia- pan-EuropeanPacific region as well as the Life supply chainSciences & Healthcare and solution providerAutomotive sectors. At euro280.0to a UK &million, the volume of new contractsconcluded with new and business is nowIreland focusedexisting customers remained very well underway.high. The margin gains achievedin these new contracts also underscoredthe division's ongoing successful performance. Afurther demonstration of this success was the steep risein operating earnings. EBIT rose from euro83.0 millionin Q3, 2010 to euro99.0 million in 2011, reflecting anincrease of nearly 20.0%.Contract Logistics boosts Q3 results atCEVACEVA Logistics has reported Q3, 2011 revenue ofeuro1.76 billion and EBITDA of euro86.0 million,up year-on-year by 1.2% and 5.8% respectively, at constantexchange rates. A good performance in ContractLogistics was partly offset by lower rates and volumes inFreight Management. Q3 saw continued good progressin Contract Logistics (CL), which grew revenue 2.5%www.ifwla.comIssue No.3

18 Financial Reportsyear-on-year. CEVA’s EBITDA margin increased yearon-yearfrom 4.7% to 4.9%. This was driven particularlyby improvements in leveraging the Company’s FreightManagement network and in improving CL contracts.With external markets remaining volatile, however,CEVA expects the uncertainty of the last few months tocontinue.High price of diesel impacts Contractlogistics earnings at LogwinIn spite of the slowdown in economic momentum, theLogwin Group generated sales of euro1,009.2 millionin the first nine months of the year, maintaining thesame level as the previous year. Operating income(EBIT) increased by 23.7% to euro23.8 million. TheCompany’s Solutions business segment generated salesof euro542.7 million in the first nine months of 2011,exceeding the previous year’s figure by 5.5%. A majorcontribution was made by the special networks operatingunder Transport and Retail Networks, as well asGeneral Cargo activities. The latter benefited in particularfrom continued growth in the automotive sector.Contract logistics activities showed satisfactory developmentprimarily due to the well-filled order books of customersin industry-related fields. However, continuinghigh capacity-related freight rates and the continuinghigh price of diesel had a negative effect on earnings.Operating income (EBIT)amounted to euro7.7 million,which was slightly below the figurefor the previous year (2010:euro8.1 million). The figure forthe comparative period in 2010,however, still included proceedsfrom the sale of fringe activitiesin the amount of euro0.7 million.The 9M operating marginfell to 1.4%, from 1.6% in thesame period of 2010.ABOVE: NorbertDentressangle’soperating margincontinues toimprove, with astrong like-for-likeperformance.Wincanton’s transformation beginsWincanton has announced its results for the sixmonths to 30 September 2011. Revenue at itscontinuing operations was £625.4 million, down 8.1%against last year. Underlying operating profit at thecontinuing operations was £22.3 million, down 11.2%representing a decrease of £2.8 million compared withlast year. This resulted in overall margins of 3.6%, inline with the equivalent six months last year (2010:3.7%) and the 3.5% for the full year ended March2011. The total operating result for the period afterexceptionals and amortisation of acquired intangiblesof £5.0 million (2010: £5.5 million) was a loss of£66.5 million (2010: £20.6 million profit). After netIssue No. 3www.ifwla.com

20 Financial Reportsfinancing charges of £9.0 million (2010: £8.9 million)the profit before tax for the year is a loss of £75.5 million(2010: £11.7 million profit).The Group’s transformation from a pan-Europeansupply chain solution provider to a UK & Irelandfocused business is now well underway. The Group’sstrategy is to achieve a clear leadership position in theUK & Ireland market based on expertise in solutiondesign and operational capabilities in warehousing,multi-modal transport and specialist services across abroad range of market sectors such as retail, defence,consumer goods, construction, milk and energy.The major variances in the UK & Ireland half year’sperformance have been within Wincanton’s Foodservicebusiness and as a result of the disposal of Recycling inAugust 2010. Whilst Wincanton made good progress inwinning and renewing business, these developmentswere offset by reduced volumes in the Container logisticssector and by two retail customers going intoadministration.In July 2011, Wincanton completed the sale of theNetherlands business and in August 2011 it completedthe sales of the German Road operations and of thebusinesses in Central & Eastern Europe. It announcedthe proposed sale of its remaining Mainland Europeanoperations to Rhenus, a transaction scheduled to completelater this year. Wincanton is also undertaking aphased withdrawal from its Foodservice business, whichhas been loss making for some time. On completion ofthese two remaining steps, it will have exited from all ofthe sub-scale or underperforming areas of its business.The greatest challenge in terms of achieving profitablegrowth lies in areas of the contract logistics businesssuch as the traditional retail and consumer goodscontracts and the more mature milk and fuel tankeroperations. At the extreme, the basic open book warehousecontract is a commodity service and marginshave declined year on year. While these services continueto be an important part of Wincanton’s businessmix, it will focus on driving margin improvements byadding value through additional services, streamliningcustomers’ supply chains or providing systems capabilitiesthat will help them manage challenges presentedby multi-channel retailing.Elsewhere.... some of the industry’s larger 3PLs presenteda mixed set of results, with revenues andprofits, up or down, depending on where you look.APL Logistics reported Q3 revenue of US$333.0 million,up 10.0% from a year ago. Q3 Core EBIT wasUS$16.0 million, down 11.0% from a year ago. Yearto-datein 2011, APL Logistics has reported revenue ofUS$1.0 billion, up 15.0% from 2010. The Companyachieved its highest average weekly revenue ever duringQ3, but at the same time, it is actively managingcosts as a reflection of uncertain economic conditions.At Panalpina, Logistics net forwarding revenues fell4.5% in Q3, 2011 to CHF210.0 million and in the 9Mperiod increased by 2.6% to reach CHF667.0 million.Gross profits fell 8.0% in Q3, to CHF81.0 million anddecreased by 3.3% in the 9M period, to CHF261.0 million.Year-to-date, Damco’s Supply chain managementvolumes were 3.0% lower than in the same period in2010 due to a relatively weak consumer demand inNorth America and Europe.Menlo Worldwide Logistics sustained its quarterlyearnings momentum. Stable customer volumes andgood cost controls enabled Menlo to deliver growth innet revenues and profits, as demand for high-valuecontract logistics and supply chain management servicescontinued to gain traction. For Q3, 2011, MenloWorldwide Logistics reported revenue of US$417.1 million,an increase of 12.7% from the prior year thirdquarter.The quarter benefited from increased revenuein both transportation management and warehousemanagement services. Net revenue reached US$154.7million, a 9.9% increase from the previous year thirdquarter. Operating income of US$12.7 million wascompared to an operating loss of US$6.3 million in Q3of last year.About AnalytiqaAnalytiqa assists companies across the global supplychain to recognise growth and profit in challengingand competitive markets.Analytiqa achieves this through the provision ofmarket reports, custom research, advisory services,white papers, supply chain consulting and executivesearch services.From Latin America to Asia, across North Americaand Europe, the Middle East and Africa, Analytiqa’ssupply chain expertise encompasses the completeend-to-end supply chain, from freight managementto home delivery, through airlines and shippinglines, freight forwarders, road and rail transport,3PL and courier and express services.Analytiqa adds value to in-house and outsourcedsupply chains by providing high quality and commerciallyrelevant market research, customer andcompetitor insight, and business development tools.Testimonials from the industry’s leading playersprovide evidence of our ability to add value to aclient’s business and these can be seen onwww.analytiqa.comAnalytiqa’s range of innovative services makeboth financial and operational contributions to theprofitability of supply chains across the globe, alldelivered through Analytiqa Interactive (www.analytiqa-interactive.com)to provide you with a greaterROI on your investmentIssue No. 3www.ifwla.com

22 AutomationDave Bull, business development manager at Dematic, explains how the profile of automation ischanging as solutions offer greater accessibility, flexibility and resilience as well as a faster return oninvestmentAutomation’schanging profileSay the word ‘Automation’ and many in thelogistics world will immediately think ofAutomated Storage and Retrieval Systems(ASRS). This established technology allows fordense storage of both pallets via automatedstacker cranes allowing heights of up to 40metres and for smaller unit loads, such as totesor full cases, in miniload and multi-shuttle systems.However the profile of automation is changing, particularlyin retail. With most retailers now having someform of Internet business many distribution centres nowserve multichannel retail operations supplying storesand internet orders – both to the customer’s home andas a ‘click and collect’ operation, where the onlineorder is being picked up in the store.So technologies that are likely to have an impact onautomated warehousing over the next couple of yearswill be those that can provide solutions for maintaininghigh customer service levels in multichannel operations– particularly those that have increased their e-commercevolumes rapidly. These technologies includemulti-shuttle systems. Although not new these systemsare still very much an emerging technology and theuses for which they are deployed are constantly evolving.Very much interlinked with shuttle technology areIssue No 3www.ifwla.com

Automation 23While traditionally picking has beenthe most labour intensive activity withina warehouse, and has seen the biggestefficiency gains through capitalinvestment in automation, other areasare emerging that can give a good ROIas automation technology becomes moreflexible and accessible. Thepacking process is one such area ripe forimprovement, especially withine-commerce operationsthe very high productivity ‘Goods to Person (GTP) stations’,which allow picking rates in excess of 800 linesper hour per operator. Both of these technologies areideally suited to single item picking and thereforeInternet retailing.While traditionally picking has been the most labourintensive activity within a warehouse, and has seen thebiggest efficiency gains through capital investment inautomation, other areas are emerging that can give agood ROI as automation technology becomes moreflexible and accessible. The packing process is onesuch area ripe for improvement, especially within e-commerce operations.Automation is also changing its profile in terms ofscale. Improved accessibility to automation means thatthe solution is no longer synonymous with large investmentand systems integration. Entry level technologiessuch as voice picking or laser guided trucks can providean almost instant win and a base from which customerscan then ramp up the level of automation overthe years as their business grows. These ‘pockets’ ofautomation, often referred to as ‘mechanisation’ canprovide specific, immediate and obvious benefits suchas a simple transport conveyor linking two processes ora standalone ASRS store for minimising the storagefootprint. It has become essential for a systems integratorto offer these less complex systems, which are moreattractive on a price point, in addition to having acapability to provide a fully integrated automated system.Dematic, for example, is well known as a large systemsintegrator but its products division, which offerscustomers simple automated solutions such as voice,conveying and pick to light, is thriving. These solutionscan be implemented without major upheaval andrequire only a relatively small investment. If you can tella customer that they will get their investment back in12 months time and then reap pure profit, they will seeopting for the automated route as less of a challenge.These solutions also present an entry level develop-www.ifwla.com Issue No 3

24 Automation“It is important for customers to be able to speak through their accountmanager to somebody involved in modernisation and upgrades todiscuss ideas and costs for such enquiries. By putting together a conceptand costings and then explaining and demonstrating its features,benefits and the return on investment, they can help customers removeobsolescence and refurbish equipment to extend the life of their currentsystems to ensure they continue to meet business objectives thus ensuringthat their automated solution’s profile does not resemble that of awhite elephant.”Dave Bull, Dematic (left)ment route for small companies on a growth path,allowing them to start with a relatively small investmentin automation, such as voice picking, then graduate toWarehouse Management Software before stepping upto a small conveyor system.When investing in any kind of automation it is vitalto look at the total cost of ownership rather than theinitial purchase price. The full lifecycle costs should belaid out in detail, including factors, such as power consumption,which are critical to ensure a system’s ‘green’credentials are fully understood.To give the customer full visibility of the full life cyclecost of a system most service contracts are now negotiatedas part of the main bid process. If you are investinga great deal of money in automation to improvematerial flows it is absolutely vital that downtime isminimised and peak performance maintained so thatthe systems deliver their full productivity, accuracy andcost reduction benefits and continue to do so wellbeyond the payback period. Today’s automated systemsare hugely reliable yet any mechanised systemneeds to be regularly maintained and serviced to deliveroptimal performance and uptime.Automated warehousing systems will play a centralrole in the support of increasingly complex supplychains and will also form the foundation for futuredevelopment. This means that making price-baseddecisions for short term savings by selecting automatedsolutions with reduced maintenance and service packageswill only increase the risk of extended downtimeand decreased productivity. Ultimately this will result ingreater costs over the long term. Looking back just fiveyears ago few companies considered the customerservice side of their automated system investment.Today’s increasingly competitive supply chains howeverhave banished complacency and customers are takinga more holistic approach and so customer service forautomation is becoming the key differentiator.Successful businesses do not stand still and keepingup with growth-based change means keeping an eyeon the future - particularly for a customer that hasstepped on the first rung of ladder with their investmentin simple automation. In a further example of howautomation has developed, a systems provider shouldnow continue to work in partnership with its client andanticipate any ongoing system and training needs aswell as supporting any requests for upgrades and modernisation.This may mean updating software or controls;it could see individual components or modulesbeing replaced or upgraded; it might also require newsolutions - for example, a customer having started inthe shallow end of automation now needs to put a further1000 pallets through its warehouse or wishes toreduce the number of staff required for picking.It is important for customers to be able to speakthrough their account manager to somebodyinvolved in modernisation and upgrades to discussideas and costs for such enquiries. By puttingtogether a concept and costings and then explainingand demonstrating its features, benefits and thereturn on investment, they can help customersremove obsolescence and refurbish equipment toextend the life of their current systems to ensure theycontinue to meet business objectives thus ensuring thattheir automated solution’s profile does not resemblethat of a white elephant.Issue No 3www.ifwla.com

26 AutomationWarehouse automation frequently fails to live up to expectations. However, Andrew Robinson ofUnipart Expert Practices (UEP) argues this should never arise if the correct approach is taken and a strictmethodology applied - one that takes an ‘end-to-end’ view of the supply chain.How to ensurepayback onautomationImplementing an automated warehouse is acomplex, expensive and sometimes risky venture.According to a recent survey conductedby Cranfield University into 27 warehouseautomation projects, ‘there are real concernsabout disruption to the ongoing operation inthe short-term and the degree of future flexibilityin the longer-term’ (1)An investment in automation - whether it is a storageand retrieval system, sortation project, order forwardingprocess or, for that matter, any other activity - may notnecessarily slash costs, eliminate bottlenecks or boostcapacity in the ways expected. Indeed, quite the oppositecan happen.The resultant soul searching and identification of asuitable scapegoat is a painful process for all. So, arethere some general rules on how this can all be avoided?Can you make sure your automation project paysbackin an acceptable timescale and delivers what youexpect?The first question to ask - and the one most frequentlyforgotten - is ‘do I really need to automate theprocess?’ Baker and Halim (1) cite three key motivatingfactors for implementing automation:• To accommodate growth• To reduce operating costs• To improve customer serviceHowever, none of these reasons necessarily requirean automated solution. Significantimprovements in all three can frequently be achievedby redesigning existing business processes.For a given, repeatable, task applying automationcan typically achieve higher levels of productivity than amanual solution. It is this productivity gain that normallysits at the heart of any justification for a piece of automatedequipment. The constraints of a manual process- be it the speed of people, space needed to completethe work, presentation of material to the operative, orremoval of work-in-progress - means the manualprocess usually has a finite capacity. By adding a levelof automation the intention is to remove that constraint;either fewer things happen or those things that happendo so faster and with greater reliability. However, asBaker and Halim point out, this may be at the cost offlexibility in the long term.There are two steps to ensuring payback on anautomation project. The first is to see if an improvementcould be made to the current manual process that alleviatesthe constraint without the need for investment inautomation. The second is to invest in a way thatensures productivity levels go up in the way intended.Let us take each of these steps in turn. Improving manualprocesses As any ‘lean’ practitioner will tell you, alarge proportion of the activity involved in a process isnon value adding. By analysing what happens in theoperation and gaining an in-depth understanding ofwhat needs to be done, as opposed to what actuallyhappens, the elements that are not required can beidentified. Typically these fall into the categories of ‘Theseven wastes’: Transportation, Inventory, Motion,Waiting, Over processing, Over production andDefects.These are sometimes remembered by the acronymTIM WOOD (or WOODE if environmental waste isadded).By tackling these wastes in a systematic way, it isusually possible to increase capacity, reduce costs andimprove flexibility. Making a heavy investment inautomation and then simply continuing to do the samewasteful activities but at a faster rate is not money wellissue No 3www.warehousinglogisticsinternational.com

Automation 27spent. There is no benefit in financing non valueadding activities. If the manual process has been fullyinvestigated and action taken to remove waste, therewill be a sound basis against which to measure theexpected benefits of automation.However, by improving the current (manual) performance,capital investment in automation will be lessattractive. But, it does ensure that the investmentappraisal is against a sound base and increases theprobability of achieving the benefits identified in thebusiness case. So if, having explored the manualprocesses, you are still of the opinion that automationoffers the answer, you can now proceed.Getting the full pictureThe automated systems supplier has confirmed thecapacity and given you run rates. These have beenreduced for start-ups, changeovers and down time. Youhave all sorts of stats and specs and have gone to seeand touch some of the kit in a working environment.You have no doubt that it will do ‘what it says on thetin’. You have even explored how the machinery isgoing to remove travel or other waste, making yourprocesses leaner. What can possibly stand in the way ofthat pat on the back for a job well done as the benefitsstart rolling in? Well, the first port of call, as with themanual improvements, is to understand the currentprocesses. Are there any complexities that needunearthing sooner rather than later? It might be thatwhat appears to be a standard repeatable process thatlends itself to automation has all sorts of exceptionsand variations. It may be that, ‘that leaflet to be includedwith the order shouldn’t go with the exports, andcertainly not to that major customer, who needs to havehis own, different shaped insert instead’.Other questions need to be asked too. Are thereoccasionally products to be handled that fall outsidethe capability of the machinery? Is that barcode alwayson the top, except for the ones from supplier ‘X’, whoonly charges half the amount of the other suppliers butslaps the barcode on the side? While on the subject ofvariation, are the volumes to be handled subject tovariation across the week or year? If so, the automationwill need to cope with peak, even if this means it isunderutilised during the remainder of the year.Furthermore, are the current processes really the onesto be understood? Nothing ever stands still and theautomated equipment is going to be used in the future,not today. What if volumes rocket and the machinerycan not cope with demand? Can additional units bebolted on or is it a matter of throwing it away andstarting again? And what happens if the product rangechanges to items that are bigger or smaller, or that arepackaged differently? It may be that the profile of worksimply changes, so orders arriving in peak need to beprocessed and out-the-door more quickly than thewww.warehousinglogisticsinternational.com Issue No 3

28 Automationmachinery is capable of. No automated solution candeal with any and every eventuality, but it is necessaryto explore likely future business changes and the impactthese would have. It would be a bad decision to investin new equipment only to find that in three years’ timeit can only handle a small percentage of the throughput.Understanding the system interfacesThis new piece of equipment will need to fit with otherprocesses upstream and downstream. When lookingat the solution, you will need to understand how thesesystems will interface, in terms of people, product anddata. Does the machinery need a steady feed of materialsor is there a buffer? Is additional software neededto get the automation’s software to talk to your warehousemanagement system (WMS)?When understanding the new world that will existafter investment, the processes sitting either side of thenew operation are critical to calculating the productivityof the whole. One of these may well become the newconstraint on capacity once the current constraint iseliminated by automation. Unless you know how theseprocesses are going to behave there may be surprisesregarding payback.Although you can never know everything about howthe automated system will work in your operation, thereare some obvious ways to reduce the risk. Are therereference sites that the automation supplier can showyou? How similar is this to your own operation? If youare leading the way and there is no existing instance ofthe technology being used as you intend you may wantto consider simulation. Simulation software can go along way to replicating the expected complexities of theoperation and can verify likely productivity levels. It canalso help in scenario planning. What if volumes staythe same but order size halves? What if we have tostart picking singles rather than cases? What if a newproduct range is introduced? What if a customer wantssome form of customisation? A simulation can test thesolution’s sensitivity to such changes.So you have a clear understanding of how theautomation is going to be used, what else will be happeningaround it, how the operation will cope withexceptions and business changes. You have doneeverything to ensure that the automation is highly productive,well integrated and flexible. Are there anyunexpected costs that might be incurred? Have you factoredin those costs beyond the purchase price that youmight expect to be associated with a project of thissize? For example, additional maintenance, purchasingof spares or training of additional staff.Plan for disruptionInevitably, there will be disruption to the existing operationbefore you are up and running. There will be aperiod of testing and bedding in of new processes duringwhich productivity is likely to fall rather than rise.Additional space may be needed during the implementation.And there are changes to running costs to consider.Will you be using more or less consumables?Finally, if the main aim was to save money throughhigher productivity, this is normally only realised oncepeople have been deployed elsewhere, left through naturalwastage or are made redundant. If the first twoare not options, then the costs of redundancy need tobe built into the payback calculation. The new operationmay require a workforce with different skills, suchas maintenance engineers or software programmers,and these people will need to be recruited and trained.Once you have a full understanding of both one-offand on-going costs associated with the change you arethen in a position to get the agreement of the decisionmakers.A controlled stepThere are strong arguments for undertaking a moveto automation. However concerns over the risks ofwhat is often considered a leap into the unknown canhold back investment. To make the change less of aleap and more of a controlled step, a systematicapproach is called for, summarised in the diagram(left).First understand the process, then identify the bottlenecksto that process, assess what can be improvedmanually before evaluating the options for automation.As part of that evaluation ensure you have a full pictureof the costs and an awareness of what will make theinvestment redundant. In a world where nothing staysstill for long this might be range, volumes, customerexpectations or a host of other variables.While certainty is never achievable some risks canbe mitigated through flexibility, phased investment andmodular designs. By working through the optionsobjectively and systematically the business can make arational decision over the expected payback on theinvestment.Andrew Robinson is a Senior Consultant at UnipartExpert PracticesReferences(1) Baker, Peter and Halim, Zaheed, Supply ChainManagement: An international journal. Volume 12,Number 2, 2007(2) Supply Chain Consultancy White Paper 4 of4Current Process Automated Solution AnalyseUnderstand Improve Process improvement withoutautomation Assess options Evaluate range of scenariosselect supplier plan implementation Approach to ensuringpayback on automationIssue No 3www.warehousinglogisticsinternational.com

30 Cover StoryWarehouse managementsystems turnbusinesses aroundMark O’Connell, Product Manager for CargoWise, considers the benefits that an intergatedwarehouse management system can bring to a businessIn these challenging economic times logisticsoperators like all businesses are under pressureto do more with less. Many have in factmothballed facilities altogether. Personnel costsin particular are one area where warehouseoperators are under pressure to economise.A robust warehouse management system can deliverthe economies of scale and streamline the process tohelp companies improve, or at the very least, improvetheir bottom line.Earlier this year the UK Warehousing Associationwarned that the industry faces a looming skills shortage.To meet this challenge £3.25 million has beenallocated through the Skills Funding Agency to theNational Skills Academy for Logistics. However thelogistics industry must do more to promote the image oflogistics as a skilled profession that involves workingwith leading edge technology. A recent survey of thirdpartylogistics operators found that Europe and theAsia-Pacific region are particularly affected by a shortageof both operational and managerial talent.Information technology, already an integral componentof most supply chain processes, will become a criticalaspect of all logistics activity as the industry is compelledto do more with fewer albeit higher-skilled personnel.Even when the global economy revives, the “leanlogistics” business model embraced in the wake of thedownturn as means of self-preservation will likely continuea key strategy for minimising risk on the one handwhilst maximising ROI on the other. The CEO of amajor logistics service provider recently commented thatthe industry has become “leaner and more adaptive” injust the last few years and better positioned to take aproactive approach to innovation which would providethe basis for future growth. This has been particularlyvisible at Small-to-Medium Enterprise level where smalleroperations have taken the opportunity to outmanoeuvrelarger competition.Lean processesIndeed, the adoption of lean processes by supplychain users such as manufacturers and retailers virtuallyobligates the providers of supply chain services tomaintain a similarly trim operational profile. For allparticipants in the supply chain the key objectives oflean logistics are waste reduction and minimisation offuture expenditure. Both of these objectives are attainablethrough cost-effective technological solutions.Warehouses and distribution centres are more thanjust a way point between different stages of the supplychain, which we often speak of as if it were a neat linearflow from sender to receiver. But the truth of courseis that it is more like a network.Warehouses and DCs are the nodes in this networkwhich prevent it from descending into chaos. Multiplestreams of cargo flow converge on these nodes wherethey are disentangled and allowed to diverge fromeach other heading in the right direction.It is not a job for just anybody, an attentive mind andan organised approach to work is required. This makesthe task all the more difficult to manage as the numberof eyes, and minds, on the job is reduced. Worse, thetrend is for logistics operations to become more ratherthan less complex.Increasingly, technology is making up for the missinghands, eyes, and to some extent minds on the warehousefloor. In much of the developed world at least,innovations as simple as bar codes to more sophisticatedRFID mobile devices have long taken over the workIssue No. 3www.warehousinglogisticsinternational.com

Cover Story 31once done by pen and paper whilst automated materialhandling and more recently autonomous robotic systemshave quite literally been taking much of the legwork out of picker’s jobs.In April this year, UK retailer John Lewis reported significantgrowth in its online sales thanks in no smallpart to efficiencies achieved through the automation ofits main distribution centre in Milton Keynes.Though battery powered minions navigatingamongst the racks and pallets like the “Scutters” fromRed Dwarf is a visually impressive demonstration of theadvance of logistics technology, the most significantadvances as a far as the industry is concerned are lesstangible. An effective Warehouse Management System(WMS) is vital to the functioning of a modern logisticscentre. A lean logistics strategy obligates logistics servicesproviders to place more and more reliance on technologicalapproaches to optimising their processes. Theimperative to minimise waste and inefficiency demandsa single picture of both in-bound and out-bound logistics.Thus in the context of market conditions that makea lean logistics strategy all but obligatory, an integratedwarehouse management system looks less a luxury thanan asset without which the physical infrastructure itself iscommercially moribund.The four major benefits of an integrated WMS are:(1) Client Visibility.Freight often moves through a network of one or manysupply chains where the warehouse serves as just onecomponent of the network. Having an integrated WMSallows clients complete visibility of their freight as itmoves from one entity to the next; for example fromWarehouse to Forwarding.(2) Planning.If the Warehouse has visibility of pending receipts, forexample through access to an International ForwardingPurchase Order module, the warehouse can better planreceiving resources and space for more efficient processing.(3) Lower cost to implement and train.With a single system approach Warehouses don’t needto externally source essential or value add modules forfunctions such as: Accounting, Workflow, DocumentManagement and Customer Relations Management.They do not need to learn, run and manage a myriadof different systems often requiring different hardwareand configurations. This saves considerable costs inunnecessary IT overheads such as training and hardware.(4) Departments can be centralised for theLogistics Service Provider.You no longer need a separate department forWarehouse Customer Service, data entry or Sales.These functions can be consolidated with a single systemapproach. This allows for one Customer Service orData Entry department using one system with visibility toall the information they need to make decisions for thegood of the entire business.Pick the right systemIt is of course important to pick the WMS solution thatis right for your business. Like any procurement decisionit should be taken at the boardroom level, able togrow with you as your business enters new markets andthe challenges that come with it. Most importantly, thosewho will be using the system must be trained to extractthe maximum value from it.The ROI from a well-chosen and implemented WMScan be dramatic and swift. One recent UK adopter ofwww.warehousinglogisticsinternational.comIssue No.3

32 Cover StoryPhoto courtesy of iForcethe CargoWise ediEnterprise solution, which includedas part of a scaled modular package theediWarehouseManager module, increased the volumeof material handled in its pick and pack warehouse sodramatically that overall turn-overs rose 25% in lessthan a year after the system went live.Such gains are not just the fruit of additional businessthat can be taken on when all of a company’sresources are mobilised. Integrated WMS’s can generatesignificant savings from reduced handling errorswith the reduction in time and financial penalties thatfollow.WMSs however are no longer just a means of trackinginventory. They have evolved into sophisticatedmanagement tools capable of tracking variables suchas the time taken to complete tasks and utilisation ofresources. They can even play a role in tailoring servicesto particular clients, demonstrating not only flexibilityin their own role but also the ability to give that flexibilityto any part of the business.Although a WMS is an integral part a logistics centrescore infrastructure, its non-physical nature meansprocurement options are flexible. In fact “procurement”in the traditional sense might not even be necessary.What if it were possible to enjoy the benefits without theoverheads and need to sustain non-core technologicalcompetencies? With the arrival of Hosted solutions suchas those provided by CargoWise this is already possible.A ready solution for the challenges aheadRecent years have seen difficult times for businessesof all kinds, but for the logistics industry in particularthere has been a watershed moment. To thrive in thecoming decade the industry will need to be as dynamicand agile as it has ever been. This means taking leadershipin fostering the talent pool and proactively seekingout the most effective technology to enable that talentto deliver value to the business.CargoWise stands ready to meet the WMS requirementsof the industry now and into the future. TheEnterprise solution with its WarehouseManager modulecan provide, if needed, not just an integrated WMS butthe whole system with which it is integrated.ABOUT CARGOWISECargoWise is a global leader in logistics technologysolutions that improve visibility,efficiency, quality of serviceand profitability. CargoWise isrenowned for its next-generationsolutions, including ediEnterprise,the industry’s only single platformsupply chain logistics managementsystem with global capability.More than 65,000 usersacross a customer community of3,500 sites in 65+ countriesmove goods through the globalsupply chain daily usingCargoWise solutions.Founded in 1994, CargoWise is headquarteredin Australia. Its team of more than 200employees operates worldwide from officesacross the U.S., Europe and Asia.For more information visitwww.cargowise.com, or contact us at: marketing@cargowise.comIssue No. 3www.warehousinglogisticsinternational.com

New focus onlogistics atCeBITHannover. As the world’s most important eventfor the digital economy, CeBIT is set to focusmore strongly than previously on the topic oflogistics. In future, the “Logistics IT” platform inHall 5 will offer manufacturers of logistics softwarenew presentation opportunities in the formof a group display and a forum.“Logistics services are based on highly dynamic andcomplex processes – the use of powerful IT solutions iscrucial for enhancing efficiency and, most importantly,for making new and intelligent solutions available tousers without delay. In the past, many providers oflogistics systems have exhibited at CeMAT, which takesplace every three years. That’s too long for such a fastmovingindustry. Thanks to the professional assistanceof the CeMAT organizers, we’re delighted that we cannow offer these providers an extra annual platform,”reports Frank Pörschmann, responsible for CeBIT atDeutsche Messe AG.Exhibitors will include the software firm PSI Logisticsfrom Berlin. Its Managing Director, Wolfgang Albrecht,is one of the driving forces behind the new logistics ITplatform: “As software manufacturers with short innovationcycles, we need another trade show alongsideCeMAT at which we and other leading suppliers canexhibit new products on an annual basis. CeBIT is idealfor this purpose. It’s where we can meet IT decisionmakersfrom the industries that are relevant to us.”CeBIT already uses the ERP-AREA, the Auto-ID/RFIDForum & Solutions Park and the Cloud ComputingWorld platforms to present topics from the logisticsindustry.The Logistics IT group display and the forum will beorganized by Deutsche Messe AG’s CeMAT team.“Looking ahead to CeBIT, we will make use of ourproven industry know-how and bring about synergiesthat will benefit the exhibiting companies,” confirmsPörschmann.www.cebit.dewww.warehousinglogisticsinternational.com

34 North AmericaCompeting as aContainer Gateway toNorth AmericaDespite the recent economic downturn North America will remain the major market destination of productsfrom low cost manufacturing countries in Asia for decades to come Garland Chow, PhD, considerskey socio-economic factors and business trends affecting the US supply chainNorth America will remain the major marketdestination of products from low costmanufacturing countries in Asia fordecades to come. Despite the recent economicdownturn, every forecast predicts trade fromAsia to resume its growth. The role and competitivenessof Port Metro Vancouver (PMV) to efficientlyand effectively enable Asian products toreach their final destination in North America isone aspect of Port Metro 2050. An understandingof key socio-economic factors and businesstrends affecting off shore trade and the supplychain helps build scenarios for strategic planning.PMV competes as a gateway with other NorthAmerican commercial ports in trans-Pacific trade lanes.To more accurately categorize trade patterns and theassociated logistics requirements, Asia should bedefined as being comprised of three distinct zones ofproduction: North Asia, South East Asia and South Asia.On the North American side, commercial and supplyrelations are best distinguished regionally according togeographic sub-sections that include: Northern,Eastern, Southern, Western and Central regions.Competitive Position of Pacific Northwest (PNW)Ports and PMVThe PNW ports of Seattle, Tacoma (U.S.) andVancouver (Canada) are geographically closer thanLA/LB, to North Asia, the origin of the majority of Asia’sexports. The PNW ports have a sizeable local marketfor Asian produced goods, possess deep water portcapacity, and are reasonably close to north and centralU.S. Ocean rates and schedules do not always reflectthe shorter distance to the PNW ports as more vesselscan completely load or unload in LA/LB resulting inmore frequent direct service. In addition, negotiatedrates for large shippers including freight forwarders areoften equalized across the west coast ports. The PNWports are a good choice for time sensitive freight movingeastward to destinations in the U.S north central(Chicago) and U.S. south Central (Memphis). Some ofthe growth in the PNW ports can be attributed to shippersseeking alternatives to the chronic congestion inLA/LB. But as container movement from Asia peaked in2006 and 2007, PNW ports have also suffered fromincreasing capacity utilization and congestion. The economicdownturn has decreased port usage however,and capacity utilization is no longer a significant differentiationfactor between gateway ports at this time.Asian freight exported to Canadian destinations canbe consolidated with U.S. based freight throughAmerican ports. But as Canadian volume increases forthe individual shipper, the shipper may find that directmovement of this freight through Canadian ports couldimprove transit time. U.S. railroad service from U.S.ports lack operations in Central and Eastern Canadaand must interchange with Canadian railroads to enterthat market. This changeover increases transit timewhile also reducing reliability, which is inherent in anyinterchange of equipment between rail lines. In contrast,Canadian railroads have coordinated operationsinto major U.S. hubs and markets including Chicagoand Memphis. Combined, the short ocean transit,seamless rail access to the U.S., comparable land transportationand absence of fees such as the HarborMaintenance Tax, improves Canadian gateway competitionfor U.S. bound traffic.Issue No. 3www.warehousinglogisticsinternational.com

North America 35Access to this U.S. heartland is increasingly importantas population and industry continues to outperformother geographic sections of the United States. The singlelocation for a distribution centre which would reachthe largest U.S. population was Bloomington, IN andnow has shifted further south to Henderson, Ky. Themajority of new auto plants are opening in this region.In other words, the U.S. destinations where PNW portsincluding PMV are competitive are growth markets.Inter-port Competitiveness is ultimatelyMeasured by Total Logistics Cost of the RoutingLocation gets PMV into the competitive area but theactual freight is delivered by the transportation systemsconnecting origins in Asia and the destinations inNorth America. Shippers ultimately choose their routingson based on the door to door logistics costsincurred, the total logistics cost. Total logistics costincludes direct transport costs, inventory costs and thecosts of service failure such as stock out, lost sales anddown time costs. These costs are largely dependent onthe capacity of the transportation and logistics infrastructureand how well the logistics service providers utilizethat capacity.Thus the following factors must be considered:• Port capacity improvements• Panama Canal expansion• Rail capacity improvements• Highway capacity improvements• Cost recovery fees such as Harbor Maintenance Tax• Shipping line scheduling and port strategies (OceanCarrier Service Deployment Strategies)• Transport Chain Management (coordination and collaboration)• Labor and Union industrial relations environment• Environmental and land use constraints• Gateway Related Fees• Security barriersLong Run Competiveness is ultimately determinedby Origin and Destination of TrafficShifting trade patterns may be more significant thanthe initiatives of gateway competitors in determiningthe competitiveness of an individual gateway and corridor.This is because; the Asia Pacific GatewayCorridor’s (APGC) location advantage is positioned forfreight originating in North and South East Asia tonorthern and central North America. If freight growthshifts to other origin–destination trade corridors, theAPGC is disadvantaged in receiving North Americanimports due to its location.Some of the key factors that are going to affectwhere products will be produced for import into NorthAmerica are:• wage rates• exchange rates• fuel/transportation costs.• Export subsidies (China VAT rebate)• Internalization of carbon emission externalities as abusiness cost.• Demand driven supply chain strategyIn fact, the convergence of the first four factors hasresulted in the Total Landed Cost of producing selectedproducts in Mexico and delivering to the U.S. marketlower then manufacturing in China and for other products,lower in India or other South Asian countries thanin China (see box). For the foreseeable future, perhapsmany decades, China will remain the overall low costwww.warehousinglogisticsinternational.comIssue No.3

36 North AmericaABOVE:A shipin dock atPort MetroVancouvermanufacturing country by shiftingmanufacturing inland, making hugetransportation infrastructure investmentsand maintaining beneficial taxand exchange rate policies. However,the long run trend in every competitivefactor indicates that manufacturingcosts will increase faster in Chinathan in competing low cost countries.This is compounded by the trend towards demand drivensupply chains that seek to postpone the final processingof the product until demand is known with certainty.Mexico is the ideal compromise of low cost andproximity to the U.S. market allowing responsiveness todemand changes. Near sourcing from Mexico willincrease and other Asian countries will grab exportshare. Products manufactured in Mexico will movedirectly by land while products exported from India aremore likely to be transported to eastern and centralU.S. markets via East Coast ports. This will reduce theshare of inbound containers via the West Coast and thesize of the market for which PMV is competitive .Some of these factors are also impacting the destinationof imported goods in North America. For examplewage rates have shifted manufacturing growth fromnorth central and east coast location to south centraland southwest locations and the population has followedas noted above.Potential Competitive ScenariosBased on likely directions in the factors identifiedabove, the following competitive environments andscenarios are posited for PMV over the near, mediumand long run. In all of these scenarios, PMV continuesto be the dominate gateway for imports from Asia destineto Canada.2010 to 2015• The world has recovered from the recession. Chinacontinues to be the main source of imports to NorthAmerica and resumes its high growth in exports to N.A.• China has maintained it competitive advantage as alow cost manufacturing center by shifting some of itsproduction to inland China where wage costs are lowerand connecting those locations to the coastal ports withhuge infrastructure improvements.• Much of the import traffic growth is to the centralU.S. with gradual shifting of economic activity furthersouth.• PMV effectively competes with Seattle – Tacoma andLA-LB for this traffic due to the reliable service reputationthat it has earned.• The reliable service was achieved through jointimprovement processes between the gateway/corridorstakeholders, joint (public-private) infrastructureimprovements funded through the APGC program andan innovative industrial relations environment affectinglabor from port to final destination.• U.S. gateway competitors make substantial infrastructureimprovements but institutional barriers preventcomparable levels of cooperation in competing U.S.gateways and corridors.• PMV captures larger share of growing traffic basefrom North Asia to central and south central U.S.2016 – 2030• China maintains its low cost country status butgrowth in exports to North America begins to slow.• Portion of historically high growth of exports to N.A.lost to countries in Southeast and South Asia whereIssue No. 3www.warehousinglogisticsinternational.com

38 North Americawage costs were comparable to China of the early2000s.• China selling more of its production to domestic andintraregional markets.• Near sourcing from Mexico grows at rates comparableto growth of Maquiladoras in early NAFTA years.• The Total Landed Cost of products from Mexico islower than Total Landed Costs of sourcing from Chinafor many products, a reversal of the situation throughoutthe period 2000 to 2006.• The change in comparative costs for serving N.A.markets is due to:• Continued wage increases in China relative towages in Mexico • Strength of the RMB versus weaknessof peso • Higher transportation costs due to fuelcosts eroding low cost manufacturing advantage ofAsia • Mexico’s National Infrastructure Program is 50% complete, reducing transportation costs to moveproducts from inside Mexico to U.S.• Mexico is also preferred for its proximity to the U.S.market as more firms adopt demand driven supplychain strategies.• West coast gateways start to lose traffic to Panamarouted traffic as new canal capacity opened in 2015(one year late) and multiple rail corridors from eastcoast ports come on line. Growth rate of Panama routedtraffic higher than west coast intermodal traffic tocentral and south central markets. LA/LB most affected.• In addition, more products are starting to be manufacturedin South Asia making transport direct to theEast Coast of N.A. via the Suez more competitive.• PMV maintains its share of a slower growing trafficbase from North Asia to central and south central U.S.2031 – 2045• China begins to lose its overall low cost country leadershipin Asia to India and other South Asia countries.• Exports to North America are increasingly routedthrough the Suez to the East Coast from India and viathe Panama to the East and Gulf Coast ports fromSouth Asia.• Mexico, other Latin American and South Americancountries have established Total Landed Cost advantagefor many products and export growth to U.S. issimilar to China’s export growth in early 2000s.• Asian import traffic to central and south central U.S.markets via West coast entry grows slowly but grows ata higher rate via east coast and gulf port gateways.• U.S. railroads and ports finally forge cooperativeagreements modeled after those between the ports andrailroads in Canada, reducing competitive advantageof cooperation held by PMV for decade.• Logistics value added services grow as theVancouver gateway import DCs start locating in lowermainland to distribute to Western half of NorthAmerica.• Climate change favors growth in Plains and RockyMountain regions of U.S as well as Prairie Provinces inCanada. Shift in economic growth to these areasincreasing demand for imports to these regions. Tosmall degree offsets decline in Asian imports to east viaWest coast.• New APGC program emphasizes intermodal androad development to provide access to Western markets.Western regional highway network starts to developalong with regional distribution networks.• PMV traffic growth levels off in low single digits inlast five years of period.2045 and beyond• Growth in Asian exports to N.A. has leveled off toreflect growth of world economies rather than growthin market share.• Share of intermodal traffic to eastern U.S. via WestCoast intermodal has declined but stabilized.• However due to land use constraints and significantenvironmental limits, LA/LB has been forced to pursuea zero growth policy for the foreseeable future. Thishas in turn diverted west coast intermodal traffic to thePNW ports as well as to Larzaro Cardenas and thePanama routing.• U.S. gateway and corridor competition has caught upwith the APGC in terms of transport coordination betweentransport providers making service to eastern and centralU.S. via U.S. gateways such as Seattle Tacoma comparableif not superior to service via the APGC.• Growth in regional distribution justifies ProLogisestablishment of Distribution Facilities in LowerMainland (don’t quote me!)• PMV and APGC reinvent itself. PMV seeks to maintainits existing competitive position in long haul Westcoast intermodal traffic market, particularly in Canada,however growth is developed through movement ofimported products through a rail – road network servingthe northwest half of the U.S. and the western andprairie province.• Key to this strategy is a new treaty guaranteeing freeand unfettered movement across the Canada – U.S.border (we need to work on it now!).Many of the assumptions stated in these scenariosare real and occurring at this moment. Others are realand it is not an issue of whether they will happen butwhen. Some are wishful thinking on one hand butcould be a reality if stakeholders in PMV are up to thetask. Some may change in timing or direction and ofcourse the quantitative magnitude of change is notmeasured with any precision.Garland Chow is the Associate Professor and Director,Bureau of Intelligent Transportation Systems and FreightSecurity, Sauder School of Business, University of BritishColumbia.Issue No. 3www.warehousinglogisticsinternational.com

40 AustraliaAustralia:a multi speedeconomyWhile the economic downturn which began inthe USA and spread to Europe has also had a significant impact on the Australianfinancial sector, Australia is in good shape, says Bill Henman National PresidentAustralian Warehousing AssociationThe “lucky country” has now reached a populationof 23 million with a rich mix ofmany cultures and beliefs. It has come along way from a convict settlement just over200 years ago. The “lucky country” however isnot so lucky for some. The economic downturnwhich began in the USA and spread to Europehas also had a significant impact on theAustralian financial sector which borrows itsfunds for investment overseas. The Australiangovernment guaranteed the four major tradingbanks to ensure monetary stability and spentmoney on a range of projects to stimulate consumerdemand. This strategy has worked sofar. The result being that Australia is in goodshape.We have a multi speed economy. The mining boomhas seen many companies working in, or providingservices to this industry sector realising good growthand financial strength. The price for iron ore and coalis at record levels with China being the major customer.It is predicted that if Europe slows further, China manufacturingwill also slow resulting in reduced demand forAustralia mineral resources. This boom has seen shortagesin labour in mainly trade skilled areas. A persondriving a dump truck on a mine site earns as a baseA$75000 plus benefits and allowances to round out atapprox $130000 per annum, for a sixty hour week.This compares to a heavy vehicle driver earning$55000 plus benefits. This boom has seen a lot ofskilled workers arrive from Ireland.Australia has a minority Labour government which isgoverning with the support of three independents in theHouse of Representatives (lower house) and with thesupport of the Greens in the Senate (upper house). It iscurrently half way through a three year term. The governmentrecently introduced a Carbon tax at $23.50 atonne due to commence 1July 2012 for three years followedby a carbon emissions trading scheme. This wasvery unpopular legislation especially in tight times. It ispredicted that energy costs will escalate significantly inthe next few years as coal powered power stations willneed to change to gas or green energy systems. Thegovernment is also introducing a mining resources tax.This proposed tax was a contributing factor in removingKevin Rudd as Prime Minister, the first time in Australia’shistory that such a thing has happened.Those in tourism are ‘doing it tough’ with anAustralian dollar on parity with the greenback, the flowfrom tourists has significantly reduced. This has seen areduction in tourists of approximately 40%. It is oftencheaper to travel overseas than holiday at home. Thereare many resorts working at half capacity due the highdollar and a severe cyclone followed by flooding inDecember 2010 that did billions of dollars of damageto infrastructure and property. The agricultural sectoralso suffered as banana plantations, tomato producers,cane farms and dairy farmers were suddenly unable tooperate. Banana prices went from $1.99 kilo to $14.50a kilo creating a banana index. Prices today are nowaround $4.50 as production returns to normal. At thesame time as half of Australia was flooded, the west ofAustralia was in drought and experiencing wide spreadbush fires – country of contrasts.Retail operators have been less fortunate with cheapgoods from both China and India decimating our manufacturingindustry. Australia has four major grocerychains, Woolworths, Coles, Aldi and Metcash (supplyingIssue No. 3www.warehousinglogisticsinternational.com

Australia 41independent operators). 80 cents in every $1.00 spenton food is purchased in either a Coles or Woolworthssupermarket. Their “home brand or generic” strategyhas seen many well known brands removed from theshelves. These two major companies have moved intoliquor distribution, hotels, electronics stores, petrol stations,clothing, home wares, hardware, variety, furnishings,sporting goods, mobile phones and optical supply.Many large shopping centres are failing or comingunder administration as multiple small businesses closedue to lower public demand and the flood of cheapimports. Companies are restructuring everywhere andshedding staff. The unemployment rate is 5.2% whichis low compared to USA, Greece and UK. The positivenews is that people are now paying cash for goodsinstead of using credit. Personal savings before theGFC was around 2% but today the figure is closer to10%, a very positive outcome.New car sales are lower this year compared to lastyear in all categories. Heavy discounting and cheapfinance from manufacturers is everywhere. Heavy trucksales are down approx 20% and new forklift salesdown about 35%. Imported forklifts sales will have animpact on the warehousing and distribution industry inthe next few years as premium models will be replacedby imported basic models.Australia is a big user of road transport and a smalluser of coastal shipping and goods rail. The bulk railsystems are well used with 10,000 tonne single drivertrains working 24 hours a day hauling coal from themines to the ocean ports. We have 24 independent railowners with government divesting itself of bulk andfreight rail systems except for passenger traffic. Statisticsconfirm that just over 1 billion tonnes of freight is carriedby heavy trucks annually between major cities.46% of freight is carried on B doubles, a single primemover and driver pulling two trailers. Trials are stillunderway for the approval of B triples (1 prime moverand 3 trailers) with gross weights of 105 tonnes.Coastal sea freight diminished in the 1980’s whereunions required costal ship crews of approximately 27persons for 20000dwt capacity. This compared tointernational ships with crews of 13 for super tankers of250,000dwt and container ships of 3000FCLs equivalents.During the same period there were 14 differentunions on the waterfront and strikes were very frequent.Australia has three layers of government; federal,state and local. Business must comply with all layers ofgovernment for most business decisions. Moves areunder way to try to harmonise all legislation so thateach State has common legislation with standardrequirements. This should reduce administrative compliancecosts for industry significantly if the master planworks. Fatigue management legislation for heavy vehicledrivers that set maximum work and rest parametershas seen transport freight costs rise 17%. The newareas for compliance are now load restraint and speeding.The speed of trucks is monitored between twopoints on a highway using overhead digital cameraswhich calculated the average vehicle electronically andissues the infringement notice within five days. Thespeed on most major highways is 110klm with city andschool zones as low as 40klm. The low speeds impacton travel time and productivity.The world of the 3PL operators is shared betweenthe major players Toll group, Linfox, DHL and PostLogistics. There is growth in this sector as managementreview financial reports and decide to reduce costs byoutsourcing. The downturn has seen a number ofcausalities in the road transport and 3PL sectors. Thetrend to have a single contractor instead of having the“best in class” in a particular State is still the norm. Asthe effects of the carbon tax and the decision to havethe source closer to the consumer may change thedynamics. The large 3PL operators often buy the businessand run it at a loss for the first few years before‘hiking’ the prices. At that time the customer often haslittle option other than to accept the price rise and trimin other areas.The baby boomer generation is now due to retireand withdraw from work. The challenge for most businessis how to fill the gaps. The younger generationmostly with University degrees do not want to work inthe warehousing and distribution sector resulting in abig void. The government has provided significantfunding to train unskilled workers to gain knowledgeand skills in most industry sectors especially the miningsector. The use of short term work visas are anothershort term solution. The Australian WarehousingAssociation (Auswa) has received government fundingto assist in providing Diploma level education to individualswho meet the selection criteria.To further develop forklift operator knowledge andskills the Association hosted a national forklift championshipin conjunction with the Sydney Safety Show andMaterials Handling Exhibition. Contestants, both maleand female demonstrated their forklift driving skillsagainst the Australian loadshifting Standard and werejudged by performing a number of set tasks. The winnerseach received a silver trophy and $1500 prizemoney. This event continues to grow and be popularas a “must do” event.As the festive season draws near, may we wisheveryone a happy and safe festive season and that2012 is prosperous.Australia is a big user of road transport and asmall user of coastal shipping and goods rail. Thebulk rail systems are well used with 10,000tonne single driver trains working 24 hours a dayhauling coal from the mines to the ocean ports.www.warehousinglogisticsinternational.comIssue No.3

42 Supply chain savingsBarloworld Supply ChainSoftware helps identify $1bnsaving for Egyptian GovernmentBarloworld Supply Chain Software’s CAST product has helped identify a supply chain saving of$1 billion USD for the Government of Egypt, which is the biggest ever saving recorded in a BarloworldSCS project.The Government of Egypt (GoE) operates a foodsubsidy program across the country. As a staple partof the Egyptian diet, Balady bread is considered themost important item in the program. With Egypt’spopulation of 78 million people and a land area fourtimes the size of the UK, the GoE faced a number ofchallenges within the Balady bread supply chain, andrequested the WFP (World Food Programme) toundertake a study (funded by the Dutch Embassy inCairo) to assess the efficiency and effectiveness of thesystem.The WFP selected its global partner, TNT Express,to help develop a supply chain solution. TNT thenapproached Barloworld Supply Chain Software (SCS)to assist.Barloworld SCS supplied the CAST software andtraining as well as additional support in building andoptimising the models.The CAST supply chain modelling software,developed by Barloworld SCS is a powerful, PCbased application used for global supply chainmodelling, network design and optimisation.CAST is used to evaluate and identify the ‘preferred’or optimal supply chain configuration and tocalculate the total cost to market, leading to costsavings and service improvements.The main project objective was to assess theefficiency and effectiveness of the existing supplychain of wheat flour for the subsidised Balady breadand propose a new efficient system to be piloted inone or two governorates as a best practice model.Barloworld SCS provided the CAST software aswell as additional training and support. Several otherinternational experts were also involved, to help identifyfurther improvement areas throughout the bakingand milling processes.The total annual cost savings calculated are inexcess of $1 billion USD, which includes the savingsIssue No. 3achieved through using ‘super bakeries’ andeliminating losses in the supply chain, reducing thetotal amount of wheat required.Chief Operating Officer at Barloworld SCS, EwanFrench, says “The project, which was carried out byTNT for the Egyptian Government, was very successfuland has helped to identify savings in excess of $1billion USD, which is a first for a CAST project.”He goes on to explain that further work is required inorder to realise the savings identified in the modellingexercise.Following the success of the modelling exercise,TNT has purchased Barloworld SCS CAST software todeploy on other supply chain projects.Barloworld SCS is a leading global supply chainplanning company, providing expertise, tools andsolutions to help companies optimise their supplychain networks, inventory and transportation. To findout more about solutions available from BarloworldSCS, visit www.barloworldscs.comwww.warehousinglogisticsinternational.com

Camcode Advertorial 43Durable Bar Code LabelsBecome the Foundation of NewWarehouse Management SystemCamcode Solutions Help Create Defined Warehousing for Building Structure CompanyWhen the structural integrity of ahome or building is compromised,Foundation Supportworks, Inc.finds experienced and knowledgeable contractorsto help property owners fix theirfailing foundations. So where doesFoundation Supportworks go when it needshelp with warehouse management solutions?The answer is Camcode.In addition to its structural repair contractornetwork, Foundation Supportworks also manufacturesand distributes foundation stabilization systems to itsnetwork of certified dealers. The company’s maindealer support center, located in Omaha, Nebraska,warehouses a wide variety of stabilization productsand equipment, such as steel foundation supports andhardware for installation. With no automated warehousemanagement system in place and nosections or designated storage areas assigned, theOmaha warehouse became more of a collection areafor all products and equipment.Foundation Supportworks wanted to implement awarehouse management system that would allowindividual locations within the warehouse. Morespecifically, they were looking fordurable warehouse floor labels tomark each section. During theirsearch, the one name that keptcoming up was Camcode.“We considered other productsand othercompanies,” said Bing Behrens,Manager of Logistics and ProcessImprovement at FoundationSupportworks. “The other vendorsdidn’t have an answer for ourfloor application, and didn’t havespecific industry experience.Camcode had both.”Foundation Supportworkschose Camcode towww.warehousinglogisticsinternational.comsupply bar code labels for its new warehousemanagement system. They wanted labels that werescannable at various distances, professional inappearance, and would last while resisting warehousedamage. The company selected Camcode’s Multi-Level Rack Labels, Retroreflective Warehouse Signs,and Adhesive Floor Labels.“We went from virtually one location to 506locations thanks to Camcode labels,” Behrens says.“We can delineate where items are stored, and havebetter management and control by location.”All of Camcode’s labels have made an impact onFoundation Supporworks’ warehousing, especially theadhesive floor labels. “The labels fully met our expectations,and the floor labels exceeded my expectations,”says Behrens. “They are easy to apply andmeet the exact dimensions for our needs.”Should Foundation Supportworks need additionalwarehouse management solutions for other dealersupport centers, they will call on Camcode.“Everything went exceptionally well. The labels wereperfect, the count was perfect, and delivery was withinour expectations,” says Behrens. “I am extremelypleased with my decision to go with Camcode. Theirservice and quality is exceptional.”Issue No.3

44 ConGri AdvertorialThe Italian JobConcrete Grinding Ltd has successfully completed theirLARGEST EVER FLOOR GRINDING CONTRACT in linear metres for a global glassware company in Italy.Concrete Grinding Ltd has successfully completedtheir LARGEST EVER FLOOR GRINDING CONTRACTin linear metres for a global glassware company inItaly.The client’s new DC floor was originally built by aflooring contractor using Laser Screed construction tomeet with DIN 18202 floor flatness specification.Whilst the racking was being installed, Trimmer S.r.lProfilegraph surveyed sample aisles and found theyall failed to meet DIN 15185, the required floorflatness standard for VNA operation. Trimmer S.r.lcontacted Concrete Grinding Ltd, whom theyrepresent in Italy, and Concrete Grinding Ltd werethen commissioned to grind the aisles to tolerance.The very busy andoperational warehouse facilityconsisted of 64 aisles, whichwere split in to 7 differentcompartments, totalling just over5700 metres. Before correctivework commenced Trimmer S.r.l.surveyed the remaining aisles,Concrete Grinding Ltd analysedthe data and identified that only80% of the total aisle lengthrequired remedial grinding. AsConcrete Grinding Ltd are theonly superflat floor grindingspecialist in the industry thatcould laser ground exact areas out of specificationrather than the whole aisle, the client commissionedConcrete Grinding Ltd to grind the aisles tospecification. This also benefited the client as precisecorrective grinding provided a cost-saving solution.To meet with the client’s deadlines, ConcreteGrinding Ltd operated two Laser Grinders and carriedout 2 wheel track grinding x 400mm cut paths on4570 metres of aisles. The facility operates B.T.(Toyota) 4 wheel fork Lift trucks where the wheels fittedperfectly within the 400mm cut path. The grindingprogram was executed on a 5 aisles rolling programso that the client’s warehouse operation couldfunction as normal.Concrete Grinding were also asked to carry outfloor joint repairs in the facility. With assistance fromCG Flooring Systems Ltd, the team carried out 110metres of joint arris repairs and 1200 metres of jointreseal repairs within the 400mm ground path to caterfor the wheels of the trucks. This resulted in anIssue No. 3additional cost saving as the whole aisle width did nothave to be repaired. The saw cut joints were resealedevery 4 metres along each aisle. 50 metres of jointrepairs were also completed within door openingsbetween the 7 separate compartments. A largeportion of the joint repairs were completedimmediately after Christmas, during the client’sshutdown, ahead of grinding work.After grinding, Trimmer S.r.l. re-surveyed the aislesusing the FACE DIN Profileograph to prove the floorflatness specification had been met.The client's Managing Director and ProjectManager were involved in the project. They were veryhappy with the work Concrete Grinding Ltd andTrimmer S.r.l had carried out. “We were veryimpressed with the quality of Concrete Grinding Ltd’sand Trimmer S.r.l.’s work and commitment to theproject. The Laser Grinding work did not interfere atany time with our busy warehouse operation. Wealso had a very strict time table and the grinding andrepair work went according to schedule. We choseConcrete Grinding because of their precision lasergrinding system and their flexible approach to ourrequirements. We are extremely pleased with theoverall results”.About Concrete Grinding LtdConcrete Grinding Ltd specialises in the upgradingof aisles in new and existing VNA/narrow aislewarehouse units. Key services are:-• Laser Guided Grinding up to ‘DM1 /Superflat’ Standards for VNA / narrow aisleenvironments using their unique & patented lasergrinding technology, the Laser Grinder ®.• Guaranteed to grind floors to any flatnessspecification.• The Laser Grinder ® is a clean andcompletely self sufficient machine which makes itsuitable in operational warehouse including food,pharmaceutical & sub-zero environments.• Bespoke internal repairs / upgrades tailoredto the individual clients’ needs.Concrete Grinding Ltd is part of the CoGri Groupof companies, a consortium of internationalwarehouse and industrial floor solution specialists withover 20 years global experience in the design,construction, surveying, testing, upgrading & repairof industrial concrete floors.For more information, please visitwww.concrete-grinding.comwww.warehousinglogisticsinternational.com

Kewill Advertorial 45Dunhelm Mill and its supplierstransform order managementwith Kewill Trade Quick StartOctober 13th, 2011, Guildford, UK – Dunelm Mill,the UK’s leading specialist homewares retailer, hasexpanded its partnership with Kewill, the leadingprovider of solutions that simplify global trade andlogistics, to upgrade its current Kewill Trade Formssolution to the new Kewill Trade Quick Start platform,further improving order management with itssuppliers by automating the processing of essentialbusinesses orders.Kewill Trade Quick Start is a fully scalable andcost-effective hosted order management system,remotely accessible from an online-portal, allowingDunelm quick electronic transfer and full visibility ofall supplier documents, such as invoices.The new multi-year agreement will enable all ofDunelm Mill’s suppliers to migrate onto the newKewill Trade Quick Start platform over the comingmonths. Dunelm decided on this upgrade in order tooffer improved order management functionality toover 100 of its suppliers.Peter Kelly, Deputy Finance Director at Dunelm,www.warehousinglogisticsinternational.comDunelm Mill,Guildford, UKcomments: “Kewill is a key service provider formanaging our supplier order process. By upgradingour suppliers to the Kewill Trade Quick Start platform,we are looking forward to providing ever greaterfunctionality and ease of use which will support ourbusiness growth plans over the coming years, as wellas provide full visibility of order processing”.An off-the-shelf hosted eCommerce solution, KewillTrade Quick Start is maintenance free and is fullyhosted by Kewill. Easily implemented within two-tofourweeks, it is fully scalable for future growth, withno limit on the number of suppliers utilising thesystem.Jacquie Boast, COO EMEA at Kewill, comments:“Dunelm has been a valued customer of ours formany years. By upgrading to the latest solution, itssuppliers will benefit from the best of breed ordermanagement system, making the entire process assimple and effective as possible, while continuing tosupport the company’s growth.”www.kewill.comIssue No.3

46 Mark Millar Hong KongHong Kong — LeadingGlobal Logistics HubHong Kong is one of the world’s leading logisticshubs. Its strategic location makes it both the Heart ofAsia – half the world’s population are within a five hourflight, and China’s Gateway – providing access intoand out of the world’s second largest economy andfasting growing consumer market.Business Confidence is HighComplementing its leadership role as a globallogistics hub, Hong Kong is also one of Asia’s leadinginternational business centres – with 3,580 regionaloffice and regional headquarters. Hong Kong is the11th largest trading entity in the world and businessconfidence levels are high. The 2010 BusinessConfidence Survey conducted by the British Chamberof Commerce in Hong Kong found very highsatisfaction levels amongst business, with 97% ofrespondents describing the business environment inHong Kong as ‘somewhat’ or ‘very’ satisfactory. Themajor reasons cited for this high level of satisfactionwere identified as geographical location, taxationsystem, communication network, public security andsafety, infrastructure and free port status.Trade and Logistics the largest of theEconomy’s Four PillarsThe world class infrastructure and free port statusare significant ingredients in Hong Kong’s enduringsuccess as a leading logistics hub. Long established asa regional trading hub and global sourcing centre,Financial Secretary John Tsang recently confirmed that,of Hong Kong’s four economic pillars, “Trade andLogistics” is the largest - accounting for 24.1 % of GDPand 24% of employment.In the 2010 global rankings of cargo volumes,Hong Kong is the world’s number one cargo airportand the third largest container seaport.World’s largest Air Cargo HubFor the last 15 years, Hong Kong InternationalAirport (HKIA) has been the world’s busiest airport forinternational cargo. In 2010, HKIA handled 4.1 milliontons of cargo, enabling Hong Kong to overtakeMemphis USA to become the world’s largest cargoairport.HKIA’s well established global network, accumulatedcritical mass, extensive connectivity and ecosystemwideefficiencies all combine to enable Hong Kong’slong standing leadership position in air freight - asboth a global Hub and a major Gateway. HKIA hosts90 airlines operating 5,800 flights per week - linkingHong Kong to 117 international destinations worldwide,plus 40 destinations in mainland China. Thisglobal network of airline connectivity far surpasses thatof Hong Kong’s closest neighbours – see chart below.Hong Kong International Airport is an importantpart of the local economy - over 30% of Hong Kong’stotal exports move by air freight, representing overUSD$100 million of products. A record 50 millionpassengers passed through the airport in 2010 and theaviation sector as a whole represents 8% of GDP andemploys over 250,000 people in Hong Kong. Theairport runs on a dual runway system providing for 60air traffic movements per hour, and averaging 880daily aircraft movements.Hong Kong has an enviable reputation of providingsecurity, transparency, efficiency, speed, andconnectivity, which together with its longstandingfree-port status makes it the number one choice oftranshipment hub. Products that are high value, haveshort product life cycles, are perishable or are neededurgently, have an intrinsic need-for-speed and thereforegravitate to the air-freight mode of transport.Consequently, within complex, global supply chainecosystems, Hong Kong is the default Global Hub andChina Gateway for such critical shipments.World’s third largest Container PortSimilarly in the ocean freight sector – whichaccounts for over 95% of world trade - Hong Kong’sfar-reaching connectivity and extensive global networkmake it the largest container port in South China.Within the South China cluster, the multiple portsprocess a total of 60 million containers (TEU) per year- of which over 23 million are handled in Hong Kong.Ranking number 3 in container ports worldwide, HongKong’s nine container terminals are all privately ownedand operated with a total of 24 berths. Being served by80 international shipping lines, providing 450container-liner services per week to more than 500destinations worldwide, Hong Kong is a majortrans-shipment hub.Even as the expanding China ports handle moredirect cargo movements in and out of the mainland,Hong Kong will leverage it’s long and distinguishedhistory as a leading nautical base and continue toexpand its role as a leading international trans-shipmenthub and regional marine services centre.Government Support for Logistics IndustryThe Hong Kong Government fully supports thetrade and logistics sector – the Secretary for Transportand Housing confirmed that the Government has“undertaken a number of measures and studies whichwould help upgrade our facilities for more efficientfreight movements and supply chain activities”.Hong Kong has recently signed the FrameworkAgreement on Hong Kong - Guangdong Cooperationwhich will advance cooperation between the twoIssue No. 3www.warehousinglogisticsinternational.com

Mark Millar Hong Kong 47territories - across many sectors. Financial SecretaryTsang noted that maintaining close ties with themainland “will further reinforce Hong Kong’s leadingposition in the global supply chain and enhance ourstrengths in trade and logistics.”In his 2011 budget address, the Financial SecretaryJohn Tsang vowed to ensure that Hong Kong can copewith air traffic growth and to reinforce the maritimeservice cluster.Investment in Infrastructure Mega ProjectsIn order to further consolidate Hong Kong’s positionas a regional logistics hub and capitalise on ourcompetitive edge in handling high-value goods andproviding high value-added services, the governmenthas three infrastructure mega projects in the works.The Hong Kong-Zhuhai-Macau Bridge - 29.6kilometres long - is expected to open in 2016. Thisbridge will enhance the efficient, cost-effectivemovement of cargo between Hong Kong and thewestern Pearl River Delta – still very much the heart ofGuangdong province’s manufacturing base.The new bridge “bears strategic and symbolicimportance to Hong Kong” said Eva Cheng, Secretaryfor Transport and Housing and - the improvedconnectivity will expand our cargo hinterland and openup new consumer markets, bringing new impetus forour freight and logistics sector.Container Terminal 10 - within the ocean freight sector,much of the container movements are mid-streamtrans-shipments, and so the government hascommissioned a feasibility study on the development ofa tenth container terminal.Third Runway - at the airport, the current two runwaysystem will be at maximum capacity by 2015 – anew daily flight handling record was set on 30 March2011 with 983 aircraft movements. Hence, within theframework of the Master Plan 2030 Study, the AirportAuthority is now evaluating the feasibility of building athird runway – which is being called for by businesseslarge and small, throughout both the industrial and thelogistics sectors.Sustainable Competitive AdvantageHong Kong’s sustainable competitive advantage asa leading global logistics hub will revolve around threepivotal competencies – best in class internationaltranshipment hub, centre of excellence for logisticsskills and leadership in e-logistics.As a transhipment hub, Hong Kong will continue togrow. In 2011, the International Air TransportAssociation (IATA) forecast that Hong Kong will be theworld’s fastest-growing air cargo market, “growing12.2 per cent annually over the next two years” suchthat cargo volumes will increase to 5.3 million tonnesin 2014.Form the e-logistics perspective, increasingly widespreadadoption of e-freight initiatives throughout theinternational air and ocean cargo sectors is increasingefficiencies whilst providing environmental benefitssuch as reducing paperwork. Within the cross bordertrucking sector, introduction of electronic submission ofroad cargo information enables seamless customsclearance at the land boundary control points. GPScommunications technology is now also widespread inthe fleet management of trucking companies, with theOn-Board Trucker Information System (OBTIS).Firmly reinforcing its position as a leading regionalcentre of excellence for logistics industry skills andtalent development, Hong Kong is home to 60educational and vocational training institutions,offering more than 1,000 programmes and coursesrelated to logistics and shipping. Government fundedtraining allowance s benefit small and mediumenterprises.ConclusionLooking to the future, I am very confident that HongKong will continue its role as a leading global logisticshub – by means of its strategic location, its businessfriendlygovernment and its sustainable competitiveadvantage.Industry and government together envisage HongKong’s future positioning as a global logistics hubproviding high value-added services and handlinghigh value products - as well as strengthening its roleas the logistics gateway to mainland China, with thesupport of state-of-the-art infrastructural facilities andtrade facilitation measures.Achieving the number one position of the world’sair cargo hubs and maintaining its position as theworld’s number three sea container seaport, HongKong is indisputably one of the world’s leading logisticshubs - enabling effective and efficient global supplychain ecosystems.Mark Millar MBA, PMHKLA, FCILTMark Millar leverages over 20 years of global businessexperience to provide independent Consulting,Education and Advisory services that create value forclients by improving the performance of their logisticsand supply chain activities in China and the AsiaPacific region.Acknowledged as an industry thought leader, clientshave engaged Mark as Speaker, Moderator, Master ofCeremonies or Conference Chairman at more than200 functions in 17 countries – including Hong Kong,Singapore, China, Macau, Vietnam, Kazakhstan,Dubai, India, Philippines, Malaysia, Thailand, SouthKorea, England, USA and Australia. His articles areregularly published by trade magazines in fivelanguages in seven countries.Mark serves on the advisory board of several leadingorganisations and his industry contributions have beenrecognised with a number of accolades, includingbeing named in the “Who's Who of Power Players inSupply Chain Management in China", the “Pro’s-to-Know Thought Leaders in Supply Chain” and as “Oneof the most Progressive People in World Logistics”.Contact him at mark@markmillar.comwww.warehousinglogisticsinternational.comIssue No.3

48 Joloda AdvertorialHeinz use Jolodato go green!Joloda have just completed another installation of an automatic loading dock for the famous Heinzcompany we all know and love.The Heinz site in Wigan produces all thebeans, tomato ketchup and soup we eateveryday and also stores the productsthere in their NDC for UK supermarketdistribution.By using a Joloda automatic loading system, itreduces the need for forklift trucks which reducescarbon emissions. Also, the automatic system movesthe pallets to the very end of the trailer so all space isutilized, meaning less trailer trips needed.Heinz have already been using 2 Slipchainautomatic loading/unloading docks installed byJoloda nearly 12 years ago, one at the factory and 1at their NDC. However with the increase inproduct portfolio over the last few years ofHP sauce, new flavours of beans and saucesand now also new packaging of beans to suitdifferent lifestyles, their output from theirfactory has increased extensively that theyneeded another loading/unloading dockfrom Joloda to increase capacity.As well as the automatic dock systems,they have 4 slipchain shuttle trailers 16mlong, which travel the distance of ½ mile,around 30 times per day.The slipchain system they use handles upto 30 pallets per load and the trailers areloaded and unloaded in 2 minutes. Thisdramatically speeds up the loading/unloading process of using forklifts whichcan take 30 minutes or more.The Hydraroll Slip chain systemincorporates pneumatically activated rise andfall chain and roller track giving high speedpallet accumulation and loading andunloading of full pallet loads. The pallets areautomatically transferred from the dock intothe trailers which are also fitted with aHydraroll slipchain system. The slipchainsystem is used for short shuttles.This system is used worldwide by manywell known everyday brands, Princes, Nestle,Coors Brewers, Unilever, Proctor & Gamble,Pepsi-co to name a few.Issue No. 3They are saving several hours per day loadingautomatically instead of forklift loading, saving costson forklifts and working a much safer andenvironmentally friendly loading process.To discuss your loading requirementsplease contact:Karen Mc BrideJoloda International, 51 Speke Road, GarstonLiverpool, L19 2NYTel – 0044 (0) 151 427 8954Fax – 0044 (0) 151 427 1393Email – sales@joloda.comwww.warehousinglogisticsinternational.com

Rooflifters Advertorial 49Roofliftersa competitive advantageDuring these turbulent economic conditionsmany logistics, warehousing, anddistribution companies must seek waysto achieve a competitive advantage. But toooften that goal is hampered by a facility thatlimits their ability to do so. This is generallydue to low clear height, a common feature inolder facilities where usable cubic space isscarce.The ability to expand through additions, new construction,and the costs related to acquire and developmentnew land has made it difficult for many businessesto do so. Yet, the ability to uniquely transforman older building with low clear height exists, and ata fraction of the cost.By raising the entire existing roof, or a portion of it,buildings can be effectively modernized into valuableand functional facilities.ROOFLIFTERS, a company that specializes in thistype of renovation/rehabilitation, has been providinga cost effective solution a problem that many in thewarehousing industry have faced. An entire roof,including lighting, electrical, and mechanical systemscan be raised to double or triple the cubic space in abuilding. In doing so, a building gains increasedcapacity, efficiency, and property value. This processcan also be started and completed far quicker thantraditional methods that achieve the same result.With industry trends moving towards taller warehousespace many older buildings under a 24' areconsidered outdated. With modern high-reach forklifts,and improved lighting and sprinkler options,businesses are now looking at 32' and higher as thenew clear-height standard. According to theROOFLIFTERS website (www.rooflifters.com) there area number of significant benefits and advantages ofraising a roof.• Maximize cubic space. Convert buildings withinsufficient ceiling heights into modern high-outputfacilities.• Remain at your current facility. No need forrelocation.• Faster when compared to other reconstructionmethods that add cubic space.• Eliminate the need for additional real estate.• Reduce development and construction costs.• Utilize the existing roof structure. Limitingenvironmental impact.• Improve marketability of existing industrialbuildings.Many building owners are using this process toimprove their own operations. However, some aredoing so to either retain a tenant or acquire a newlong term tenant. By raising their building’s existingroof owners are not only improving their competiveness,they are also increasing the value and marketabilityof one of their most valued assets.www.warehousinglogisticsinternational.comIssue No.3

50 Twintec AdvertorialTwintec Advisory Paper 1:21st Century Warehouses& Storage FacilitiesDarryl Eddy, Director, Twintec UKA modern 21st century warehouse is a very differentplace from its predecessor of the 1980s and 1990’s.Developments in logistics technology and software alongwith advances in storage systems and mechanicalhandling equipment (MHE) have allowed manufacturersand distribution companies to become dramatically moreefficient.Racking systems are becoming higher, aisles narrowerand automated systems commonplace, providingoperators with efficient stock retrieval and faster deliveryto the customer. These facilities are increasing in size interms of footprint and height. These facilities place muchgreater demands on the flooring system including muchmore aggressive surface wear, much higher loads beingimposed on the floor slab and an increase in the flatnesstolerances required.Another consideration that needs to be addressed insuch a fast moving industry is ‘future-proofing’.Continuing improvements in technology have led someconsultants to suggest that changes to the logistics systemsin a modern warehouse are needed every 5 – 10 years.This presents an additional problem for clients, tenantsand third party logistics (3PL) companies and has a directbearing on the type of floor specified and constructed ina new facility. Most of the maintenance problems inindustrial concrete floors result from unevenness anddisruptions of the surface, particularly at joints.For the operator of a modern distribution facility, downtime to repair the floor slab, or MHE damaged by a poorquality floor slab can be very disruptive. In addition, thecurling and breakdown of sawn joints in a traditionalsystem can cause major disruption for MHE in terms ofpicking speed. A further potential problem is the need torespect the designer’s criteria regarding proximity ofracking legs to floor joints; the more joints there are, thegreater the likelihood that conflicts could arise.Building owners are increasingly aware of suchproblems associated with saw-cut joints; therefore‘joint-free’ industrial flooring systems such as steel fibrereinforced concrete (SFRC) are becoming more frequentlyspecified and have proven to be a successful solution.A SFRC ‘joint-free’ slab is designed to eliminate theneed for saw cut induced contraction joints. The design isa well proven method with a thirty year track record.Eliminating the saw cut joints has a significant benefit tothe end user in terms of increased flexibility of use,improved toughness and durability and reducedmaintenance costs for both floor slab and forklifts.Adopting a SFRC ‘joint-free’ system will not onlyminimise the problems identified above, but also improvethe flexibility of the building in terms of ‘futureproofing’it.ConclusionThe quality and durability of a modern industrial floorslab is key to the success and efficiency of a modernlogistics facility. UK Concrete Society Technical Report No34 section 2.1 says that “an ideal floor would beperfectly flat and level and have no joints”. This is moreachievable with SFRC than with lightly reinforced floorslabs as it allows the elimination of saw-cut joints, andtherefore ensures better long term flatness.However, once building owners, consulting engineers,architects and general contractors have decided to opt fora ‘joint-free’ SFRC slab, they must take precautions inchoosing the right specialist contractor for the job bycarefully reviewing the following items:• The contractor’s track record in ‘joint-free’ SFRC floors• Visit ‘joint-free’ reference floors and ask the opinion oftheir users• Check the site quality control procedures proposed bythe concrete contractor• Ensure that adequate site conditions will be in placebefore, during and after the works• Ensure early co-ordination takes place with thecontractor to optimise the detailed design andparticularly adjoining interfaces• Limit the number of split responsibilities within thecontract• Be aware of and accept the possibilities of controlledcracksIf these factors are carefully considered, if theplanning and design process is integrated carefully withthe building and the logistics systems and if the correctcontractor and supply chain is selected, then the end resultwill be that everyone gets exactly what is best for theproject.Twintec Limited, Prospect Park, Valley Drive, Rugby,Warwickshire. CV21 1TFTel : 01788 567722 ▪ Email: mail@twintec.co.ukWebsite : www.twintec.co.ukIssue No. 3www.warehousinglogisticsinternational.com

Yale Advertorial 51WAREHOUSE SIMULATORSHOWS THE FULL STORYYale’s warehouse simulator is an extremely accuratesoftware program designed to provide operators of largewarehouses with a sophisticated consultancy solution.Yale’s consultative approach is provided free ofcharge by the company’s warehouse equipment specialistsin determining the optimum warehouse design andequipment specification. The program uses the samesimulation ‘engine’ used by major European airports,leading rail infrastructure companies and other blue-chiporganisations. It uses intelligent algorithms to write thespecialist code bespoke for each end user application,down to the finest level of detail.The input interface breaks down the sections of thelargest warehouse into atomic parts including marshalling,parking and staging areas, the exact type ofracking, storage and the fleet to be used. VDI dataincluding speeds and energy consumption, goods flowand order picking and replenishment regimes data canall be input into the program.The simulation software was recently used to helpdetermine the optimum design and equipment requiredfor one of the largest warehouses in the Middle East, a375,000 sq ft facility at Jabel Ali South, Dubai, operatedby Clarion Integrated Logistics Solutions.Yale was involved with the development from the earliestplanning stages with SSI Schaefer, when Clarionneeded to know the maximum number of pallets thatcould be stored and moved within the available space.To illustrate the potential capacity of the facility the simulationsoftware was used to show how the maximum efficiencycould be achieved.Using six Yale Very Narrow Aisle high level orderpickers (MTC) trucks, combined with six counter balancetrucks on a wire guided system, the software showed thatjust under 192 pallet movements per hour could beachieved. Within three hours the simulation identified acongestion issue in the picking operations. This helpedprovide Clarion with a clear picture of their requirementsand gave them the reassurance that Yale was a companywith the knowledge, expertise and product range tobe able to supply the materials handling equipment fortheir showpiece warehouse.The simulator’s presentation is unique in that it showsa realistic picture of the warehouse using images of theequipment being proposed and the customer’s currentor planned assets in situ. In addition, it builds in orderpicking paradigms and other important details of day towww.warehousinglogisticsinternational.comday operations including details of the equipment beingspecified, speed, braking, lifting and lowering and otherperformance criteria. The simulation also accounts forpower usage and the impact of battery changing andcharging on shift performance.Yale’s VNA and warehouse systems manager, RonFarr, comments: “We can build in accurate break timesand interfacing operations as well as congestion withinthe aisles. All of the data is input and then the simulatoritself writes the specialist coding. This enables clients tomake easily informed decisions when they can see thefull story of what will happen in their warehouse whenall the equipment has been commissioned and the warehouseis fully operational.“The shift pattern system is intelligent enough to handlecontract details such as service intervals and caneven account for user licences.”As well as calculating hourly usage rates and or KPIsfor service agreements, the number of pallet movementsand even the number of lorries that are backed up duringa period can be seen.The algorithms can handle seasonal fluctuations, flexiblelayouts, mixed fleets and additional stand-by trucksto provide a vivid and colourful 3D and 2D representationof the warehouse.Yale warehouse equipment is provided through BriggsEquipment UK Ltd the exclusive Yale dealer in GreatBritain. As one of the leading materials handling specialists,Briggs Equipment has the ability to provide customerswith a complete warehouse solution, from assistingin the planning of a new warehouse to the efficientmanagement of the materials handling fleet once thewarehouse is operational.Mark Murfet, VNA and warehouse product managerfor Briggs Equipment comments “We understand theimportance of getting the most out of any warehouseassets and storage space, as well as ensuring that thefacility operates with maximum efficiency. Briggs, inpartnership with Yale, offers a consultancy solution aspart of our business ethos. The Warehouse Simulatorfrom Yale gives us the ability to analyse data to offer thebest solution that is tailored to that exact need of eventhe most complex warehouse scenarios.”For further information please log on towww.yale-warehousing.euIssue No.3

Good guy? Bad guy? Want to have a guess?John LennonMarco PoloMuhammad AliMarie CurieWilliamShakespeareAndy WarholAttila the HunMohandasGandhiFlorenceNightingaleAlbertEinsteinGuy FawkesCharles DarwinLouis PasteurPythagorasJane AustenLegal compliance is no guessinggame. Restricted Party Screeningwith ASSIST4 Compliance& Risk Management.ASSIST4 is the comprehensive software suite for all logistics processes in global business.Warehouse. Transport. Freight. Customs. Visibility. Compliance & Risk Management.www.aeb-international.co.uk | assist4@aeb-international.co.uk | or call +44(0)1926 801250