Randall Manufacturing
Archive | Printer Friendly Version | Send to a Friend | www.mhi.org | MHI Solutions magazine April 10, 2013

Locating logistics companies and the businesses they serve in close proximity can drive economic growth and become a significant source of jobs in the global economy.

These "logistics clusters" have emerged across the globe in areas like Singapore, Memphis, Chicago, Rotterdam, and Los Angeles. This clustering enhances the productivity of global supply chains, promotes trade, sustains economic growth, and creates good jobs. Where will the next clusters be?


World Trade
We all know that moving freight the right way reduces transportation cost, but sometimes we overlook the value of moving the right freight. That is, the freight most valuable for you to manage.

Freight Term Optimization (FTO) is the process by which shippers strategically establish the most advantageous freight terms, minimizing total inbound landed cost and maximizing margins on product shipped outbound.


It reached critical mass, went viral, and swiftly moved through the population. At the height of its powers it affected tens of thousands of individuals and manifested itself in every facet of the supply chain. Raw material suppliers, component manufacturers, distributors, transportation carriers, contract manufacturers, and end customers were all touched by it.

And even now, as it loses its steam and begins to go dormant, it will strike out and affect thousands more. I am talking about the flu and using it as an example of the fragility of the supply chain to external events.


Industry Week
Four years after the recession imposed corporate belt-tightening around the world, we see U.S. companies operating at near-record peaks of efficiency. The downside? These cost efficiencies have in many cases eroded supply chain flexibility. As demand dropped during the recession, many businesses trimmed inventory levels and cut costs in supply chain operations. Today, these businesses are finding their weakened supply chains can't keep pace with economic recovery.

As a result, organizations are rethinking their supply chains to craft a strategy that can deftly accommodate broad swings in demand and supply. In fact, 64% of respondents to PwC's recent Global Supply Chain Survey said they plan to implement greater flexibility to better respond to shifts in volume. That makes flexibility a top supply chain priority this year, just behind maximizing delivery performance and minimizing supply chain costs.

Pharmaceutical & Medical Packaging News
With rapidly increasing interest in sustainable packaging materials, many companies are choosing to ship their temperature-sensitive products in reusable shipping containers rather than traditional cardboard boxes. The idea of a reusable shipper is exciting and proof that companies are "thinking green." But how does it work in practice? How can a company be sure the medications they've just shipped cross-country don't contaminate the box's next payload? And how would that company know they're truly getting their own boxes back - and not someone else's?
Goff Enterprises

Area Development
In the face of rising domestic labor costs, many companies, over the years, moved their manufacturing and assembly operations to low-labor-cost countries, especially to China. Now, local wage inflation and other factors abroad are eroding that advantage.

Long lead times, inventory issues, higher fuel costs, and a diminished customization or innovation capability all help highlight the fragility of long-distance supply chains and are beginning to impact sourcing decisions. Natural disasters like the one in Japan, political instability, rapidly rising foreign wages coupled with U.S. currency depreciation, high oil prices, quality concerns, the loss of intellectual property, and the lack of legal protections offshore are all also part of the equation. Even such factors as emergency airfreight, travel costs, and time zone and language problems are back under a lens of scrutiny.

Material Handling & Logistics
1950s science fiction movies had an effect on me, as evidenced by the above headline. But it's not a far stretch of the truth to say that moths could delay shipments this year. Inchcape Shipping Services announced a little while back that U.S. and Canadian authorities intercepted a large number of ships infested with Asian gypsy moth (AGM) egg masses arriving in North America last year. That inspired the U.S. Department of Agriculture and Canadian Food Inspection Agency to issue regulations for vessels arriving at North American ports this summer from Far East Russia, Japan, Korea and Northern China.

Vessels arriving without the required AGM documentation - or if they're found to be infested - could cause significant delays in cargo loading or discharging. Although it is the responsibility of the shipping lines to meet all requirements for entry to the U.S. and Canada, it's good for you to be mindful of yet another potential bug in your supply chain's clockwork.


Much has been said about the demise of American manufacturing. There is a general sense that manufacturing jobs are being moved overseas to China, India, and other developing markets, yet from what we can tell, U.S. companies and other developed multi-nationals are still looking for ways to leverage ERP systems.

In fact, a majority of our clients - most of whom are investing in some sort of new ERP software - are in the manufacturing and distribution industry or one of its many sub-verticals, so it doesn't appear to us as though our U.S.-based clients going out of business. So where is the disconnect?


With enhanced speed and efficiency, rail is fast becoming a major player in the U.S. commercial transport system and is vital to economic recovery. Rail is increasing its share of U.S. commercial transport with the U.S. rail network accounting for approximately 40 percent of U.S. freight moves by ton-miles (the length freight travels) and 16 percent by tons (the weight of freight moved).

U.S. freight railroads are private organizations that are responsible for their own maintenance and improvement projects. The Association of American Railroads (AAR) recently announced a plan to invest an estimated $24.5 billion in 2013 to build, maintain and upgrade the U.S. rail network. This investment includes $13 billion in projected capital expenditures, or CapEx, which go toward upgrading or enhancing rail network capacity in the year ahead.


Supply Chain Brain
Regardless of the goods that are being shipped - from electronics to pharmaceuticals to fruit - once released into the supply chain, they are immediately at risk. And the longer they are in transit, the more vulnerable those goods become - facing threats of terrorism, of theft, or even of a natural disaster. Until the cargo arrives safely at its final destination, there are an inordinate number of things that could jeopardize the supply chain from running smoothly.

If we learned nothing else from the Icelandic volcano eruption in 2010, we learned how a seemingly isolated event can - and did - have a drastic effect on worldwide logistics.


A new econometric forecast model shows that there is ample potential for U.S. manufacturing to undergo a resurgence that by 2025 would lead to significantly more good paying manufacturing jobs, add to GDP growth, and help create the first surplus in the nation's goods and services balance of trade since 1975.

The study was sponsored jointly by The Aspen Institute's program on Manufacturing and Society in the 21st Century and MAPI. The economic model and expert advice used for the projections were provided by the University of Maryland's Interindustry Forecasting Project (Inforum).


DC Velocity
Sometimes it's hard to predict what articles will resonate with readers. It's even harder to anticipate which stories in DC Velocity, which is targeted to a specialized audience after all, will take on a life of their own on the Web.

We've just experienced both with a story that ran in our March issue about efforts to help U.S. military veterans who are departing the service find work in the logistics sector. For several weeks after we posted the story, "Hire our heroes ... the right way," it consistently ranked among the most read articles on our website. We've heard plaudits from some folks who are helping vets make the transition from military life to the private sector and from others anxious to share the article with their own networks.


In previous articles, I wrote about DNA marking as an anti-counterfeiting measure. A few of the commenters suggested that the technology for sequencing authentication was too pricey to expect widespread deployments. My response was that costs will come down as a function of technology introductions that will put DNA sequencing equipment on the desktop at company receiving stations.

I mentioned that we might be looking out two to four years before this portable sequencer might become available. Also in the article, I wrote about a technology breakthrough that might make this a reality at $1,000. Well, I am delighted to say that there is a working handheld sequencer available using nanopore protein structures that can sequence up to 70,000 base pairs in a very short period of time.


Brand Packaging
Sustainability - being green - has gone mainstream. Major brands in every sector from fast food to fashion have spent significant resources making sure their products and corporate image stack up well in terms of environmental and social impact.

Consumers are demanding solutions that are better for the planet. Sales of LOHAS (Lifestyles of Health and Sustainability) products reached $300 billion in 2008, up 36 percent from 2005. Today, about 80 percent of U.S. adults are looking for more sustainable offerings.


A few years ago, a well-known philanthropist wondered how Coca-Cola could deliver beverages daily to remote African villages, while it took other organizations 30 days or more to deliver life-saving medicine to the same locations. The human cost was incalculable. Doctors and nurses were receiving spoiled medical supplies and vaccines, the wrong medicine, or - in many instances - nothing at all.

In 2010, we helped create a public-private partnership designed to assist Tanzania's state-run medicine-distribution network in building a more efficient supply chain. We worked to improve the delivery of critical medicine to rural communities by developing training programs and helping to redesign planning and procurement processes. Working with our partners, for example, we collected data on the location and functional status of some 5,000 public-health facilities in Tanzania and fed it into an Excel-based tool that we developed to help optimize medicine-delivery routes.


Material Handling & Logistics
Purchasers of work stations must focus on space planning to reduce exposure to hazards and design out ergonomic risk, according to Josh Kerst, vice president at Humantech, and author of a new e-book, "Six Ways to Apply Ergonomics in Design."

Furthermore, ensuring products and equipment are designed "ergonomically" should be the responsibility of the user's engineering team, not the equipment supplier, he contends.

"Relying on suppliers to tell you that their products and equipment are ergonomically designed is not a good practice, and could lead to mistakes or cause injury," he explains, adding that many equipment manufacturers will claim their equipment is "ergonomic" when no study has been conducted to prove it.

Naylor, LLC


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