Archive | Printer Friendly Version | Send to a Friend | | MHI Solutions magazine February 21, 2013

Material Handling & Logistics
Small and medium-sized enterprises (SMEs) in G7 and BRICM economies that reach international markets are twice as likely to be successful as those that only operate domestically, according to a study which surveyed 410 SMEs. Of the SMEs surveyed by U.S.-based IHS Global Insight and DHL Express, 26% of those that traded internationally also significantly outperformed the market, while only 13% of domestic-only SMEs also outperformed the market. SMEs cited several key benefits of an international approach, including access to new markets and technology as well as stronger diversification of their products or services.

The study also highlighted that an inadequate business infrastructure can constrain a company's competitiveness due to the reduction of business efficiency. For example, SMEs have to work harder to overcome infrastructure inefficiencies, particularly compared to larger companies with greater resources. The most significant concerns for SMEs that trade internationally are the lack of available information on foreign markets, high customs duties, the difficulty of establishing contacts with foreign partners and ability to successfully generate an overseas customer base.


In his research as the executive director of the Global Supply Chain Institute at the University of Tennessee, J. Paul Dittmann, Ph.D., has found that of the 15% of U.S. corporations with a supply chain strategy in place, its development is treated as a non-trivial exercise.

"Most companies will take an afternoon to talk about supply chain strategy as part of an off-site planning session for next year. And that's not enough," he notes. "The companies that do this well understand it requires a lot of information -perhaps over as many as three months -before they determine what the strategy is, and what the right projects are."


The Produce News
There is a direct correlation between the ups and downs of the economy and the sales trends associated with the packaging manufacturing industry. At least that is what the figures suggest, according to Andrew Duguay, who is a senior economist with the Institute for Trend Research in Boscawen, NH.

In January, Mr. Duguay was featured in an economics outlook webinar presented to the membership of Packaging Machinery Manufacturers Institute, which is a trade association of more than 600 member companies that manufacture packaging, processing and related converting machinery in the United States, Canada and Mexico. The economist said that, going back decades, industry sales mirror almost exactly the high and lows of the economy.


Dairy Foods
By now, we all know that the Mayans weren't correct. The world did not end on Dec. 21, 2012, but anyone involved in trucking is certainly facing a number of problems and might feel as though the Mayans were onto something. These include emission and mileage standards; the California Air Resources Board; SmartWay; Compliance, Safety, and Accountability; EOBRs (electronic logging devices); driver shortages and employee turnover.

The Environmental Protection Agency and the National Highway Traffic Safety Administration have announced a program to reduce greenhouse gas emissions and improve fuel efficiency of medium- and heavy-duty trucks for model years 2017 and beyond. Tractors will be required to achieve up to an approximately 20% reduction in fuel consumption and greenhouse gas emissions by model year 2018. Delivery trucks will be required to reduce fuel consumption and greenhouse gas emissions by approximately 10% by model year 2018.


World Trade 100
As World Trade 100 readers already know, cold chain logistics is mainly applied to chilled and frozen foods in order to maintain the quality and increase the shelf life. After the 2010 economic slowdown, a major shift was observed in the frozen food industry due to increased investments of the large players in this sector. Various initiatives taken by various governments have also drastically affected this market positively.

Due to the requirement of more cold storage and transport facilities, the leading players are gradually shifting towards emerging markets such as Asia and Latin America, says the report. This shift is also majorly influenced by changing preferences and tastes of the consumers in the existing market. Strategic acquisitions with smaller local companies are made by these players to enter the untapped market.

Goff Enterprises

Much like its products, the global high-tech marketplace constantly changes and evolves, making flexibility an essential element for success. Findings from UPS's latest annual Change in the Chain survey, conducted by IDC Manufacturing Insights, demonstrate the need for greater supply chain adaptability, especially when it comes to high-tech executives' shifting sourcing plans.

As referenced in previous blog posts, our annual survey explores the impact of industry changes on the high-tech supply chain and identifies future business and supply chain strategies and plans of senior-level high-tech decision makers.


Fundamentally, the health of a supply chain is the dominant factor in ensuring a company's overall financial health and shareholder value, says J. Paul Dittmann, Ph.D., the executive director of the Global Supply Chain Institute at the University of Tennessee, author of two books about supply chain strategy, including "Supply Chain Transformation: Building and Executing an Integrated Supply Chain Strategy,"released in October 2012.

While most corporate executives readily acknowledge that fact, continues Dittmann, "thousands of these companies never consider supply chain strategies when creating business plans - even though the supply chain accounts for roughly 60% of a firm's total costs, 100% of the inventory, and is essential to providing the customer service required to drive sales."


World Trade
UPS Inc. has announced that it has formed a strategic collaboration with Jabil Circuit Inc. UPS's logistics and distribution business unit and Jabil Aftermarket Services will provide optimized reverse logistics solutions for return and repair programs to high-tech original equipment manufacturers, service providers and enterprises on a global scale.

By combining UPS's warehousing, transportation, returns management and trade compliance capabilities with Jabil's reverse logistics planning, repair and call center support, the UPS/Jabil collaboration provides a turn-key supply chain model that can drive efficiencies, reduce vendor complexity and enhance customer service.


It would be unfortunate if electronics companies were to resist the integration of transactional data, such as geography, delayed shipments, and supplier payment terms, with master data, such as supplier, customer, and inventory management. There is a great wealth of data that can be collected from search engines and marketing and advertising platforms to provide insight into consumer interest and intent.

Such data harvesting should enable more accurate demand forecasts. Adobe, Oracle, SAP, and Salesforce have been working to create platforms that not only combine internal and external data from manufacturers and suppliers, but also structured and unstructured data sources across the Internet from consumers. These unstructured sources bring in insight from social sites like LinkedIn, Twitter, or Facebook. Imagine making a decision to fill a bill of materials to build a smartphone or tablet based on data gleaned from likes or dislikes in social networks or the number of tweets on a specific subject in Twitter.


Material Handling & Logistics
Labor, time and space savings add up to significant financial savings if you slot, package and pick correctly.

Order fulfillment is often reported to consume more than 60% of the total direct labor associated with warehouse operation.

Consequently, the warehouse picking area usually offers the best opportunities for savings through use of optimization methods. This article focuses on three of those methods.


Logistics Management
The average price per gallon of diesel gasoline is only heading in one direction of late: up.

According to data released this week by the Department of Energy's Energy Information Administration (EIA), diesel jumped up 5.3 cents to $4.157 per gallon, marking the fifth straight weekly gain. What's more, prices have gone up a cumulative 23 cents during that period and 17.7 cents in the past three weeks alone.


Overtime with changes in a company's business model, customer order profiles, and SKU mix, material handling equipment and system controls can become outdated. Given the high replacement cost of new equipment, along with untimely disruptions to on-going operations, it's smart to first consider less evasive alternatives.

If the problem is frequent equipment breakdowns resulting in the loss of productivity, industry experts generally agree that with very little capital expenditure you can increase the performance of older conveyor transportation and sorting systems by 10 to 20%.


Material Handling & Logistics
Same-day delivery from major e-commerce and multichannel retailers during the 2012 holiday season introduced e-commerce as a viable option, even for last-minute shoppers. This evolution in customer demand now ripples through the supply chain for all retailers, prompting executives to re-evaluate real estate strategies, according to a new report from Jones Lang LaSalle (JLL).

"Retailers are anxious to create effective multichannel strategies that cater to new customer expectations, such as same-day delivery as well as e-and m-commerce,"said Kris Bjorson, head of JLL's Retail/E-commerce Distribution group. "This means revaluating their supply chain networks and distribution models down to one of the most important components, their distributions centers."


Fleet Owner
Looking at the tonnage numbers recently posted by the American Trucking Associations (ATA), one would be forgiven for thinking that now would be a pretty good time for carriers to go on a hiring spree.

According to the ATA's for-hire truck tonnage index, freight volumes increased 2.9% in January after jumping a (revised) 2.4% in December, with tonnage overall "surging,"in the trade group's words, at least 2.4% every month since November, gaining a total of 9.1% over that period.


Business Wire
INTTRA, the world's largest and most active network for ocean shipping, today released findings of a global study of high-volume shippers and freight forwarders that included 4 of the top 5 global logistics providers. Four years of economic volatility have intensified pressure on carriers and shippers to seek new ways to reduce costs and have seen no relief on pressure to increase service levels. One cost reduction method that has demonstrated results across government and commercial sectors is electronic invoicing (e-Invoicing). Once referred to simply as a "best practice," e-Invoicing is emerging as a critical cost reduction tool for companies in or those impacted by the struggling ocean shipping industry.


Press Release Point
Russian Railways Logistics started transportation of GW Wingle 5 produced by Great Wall Motor Company Limited (GWM) from China to Russia. First 48 pickups were forwarded to Gzhel, Russia by railroad in the specialized wagons. The project traffic volume is to amount to 400 cars a month.

Due to the high requirements for the service quality the loading of Russian wagons was carried out in China. To implement this technology Transbaikal Railway and Chita Customs developed a special operating procedure. This technology will increase the amount of cargo transported in the specialized wagons on Zabaikalsk-Manchuria route. In the future this service may be carried out in Zabaikalsk, Russia depending on the technical capacity.

Naylor, LLC


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