Vol VIII Issue V April 2017 `20 Postal Registration No.: DL (S)-01/3372/2016-2018 WPP No.: U(S)-81/2016-2018 Posted at Lodhi Road HPO, ND on the 4th-5th same month RNI No.: DELENG/2009/31040 Published on the 2nd of the same month
2
CargoConnect - April 2017
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VOL VIII ISSUE V April 2017 `20
Postal Registration No.: DL (S)-01/3372/2016-2018 WPP No.: U(S)-81/2016-2018 Posted at Lodhi Road HPO, ND on the 4th-5th same month RNI No.: DELENG/2009/31040 Published on the 2nd of the same month
A Million Miles to Recheck
Curbing Delhi’s Pollution with RoRo
Security and Customs Backbone of air cargo operations
Contents
Volume VIII • Issue V • april 2017
Editor and Publisher Smiti Suri Principal Correspondent Ritika Arora Bhola Feature Writer Tariq Ahmed Nicin Varghese Asad Mohammad Gaurav Dubey Sheena Sachdeva Deepashree Banerjee
10
20 COVER STORY
The Silk Route for Consumer Durables
SPECIAL FEATURE
A Million Miles to Recheck
FEATURE
INTERVIEW Edvins Berzins, CEO, Latvian Railway .............62
Curbing Delhi’s Pollution with RoRo .......................40
Administration Vipin Marwah
N Rama Krishna, General Manager (Marketing and Sales), Kribhco Infrastructure Limited .....66
Sr Designer & Visualiser Shaique Ahmad
Ulrich Ogiermann, Chief Officer Cargo, Qatar Airways Cargo ................................................68
Designer & Visualiser Mayank Bhatnagar
GUEST COLUMN .................74-76 shippers speak ....................78
All material printed in this publication is the sole property of CargoConnect All printed matter contained in the magazine is based on the information of those featured in it. The views, ideas, comments and opinions expressed are solely of those featured and the Editor and Publisher do not necessarily subscribe to the same.
NEWS ..................................80-88 EVENTS ................................90-98
CargoConnect is printed, published and owned by Smiti Suri, and is printed at Compudata Services, 42, Dsidc Shed, Scheme–1, Okhla Industrial Area Complex, Phase–II, New Delhi-110020, and published at 6/31-B, Jangpura–B, New Delhi-110014.
appoinments ........................99
Editor–Smiti Suri
UPCOMING EVENTS .................99 PEOPLE CONNECT
Samir J Shah, Owner, JBS Group of Companies ...100 Bunch of Delhi Women conquering another male bastion ....................60
Marketing Executive Mehuli Choudhury
Accounts and Administration Poonam Gupta
Andrew Jillings, Chief Executive Officer and Group Managing Director, Tigers Group .........72
Backbone of Air Cargo Operations ......46
Manager Marketing Niti Chauhan
Satish Lakkaraju, Chief Commercial Officer, Agility Logistics Services Private Limited ....64
Dirk Schusdziara, Senior Vice President Cargo, Frankfurt Airport .............................................70
Security and Customs:
Director Marketing Ajeet Kumar
TOTAL PAGES: 102 (inclusive of cover)
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Upfront “There is a need for repealing five obsolete British statutes on admiralty jurisdiction in civil matters which are 126 to 177 years old.” Mansukh Mandaviya, Union Minister of State for Road Transport and Highways
while presenting Admiralty (Jurisdiction and Settlement of Maritime Claims) Bill, 2016 in Lok Sabha.
Nitin Gadkari
Minister for Road Transport and Highways
“The Government will launch an integrated transport and logistics policy to increase the average freight speed on highways to 50 kilometer per hour and cutting costs by half.”
Speaking at the 11th World Cargo Symposium in Dubai, IATA director general Alexandre de Juniac said: “Driving change—whether it is to modernize processes or unlock value through innovation—is challenging for a business where global standards are so vital. Air cargo is highly regulated–so governments must be on-board with change. We are a complex value chain, so building industry consensus is critical. To be successful we must work in strong partnerships.” 8
CargoConnect - April 2017
Kristalina Georgieva CEO, World Bank
We propose to provide an assistance of over USD 1 billion in the areas of urban transport and climate resilient agriculture in Maharashtra, over the next 2-3 years.
“The RO-RO is a boon for Delhi as it would have a direct impact on its air ambient quality and the capital would breathe clean air.” Suresh Prabhu Railway Minister
SPECIAL feature Transportation- A Lion’s Share in the Economy
Million Miles to Rechec
At the turn of the 20th century, when the first truck delivered its initial load of goods to its first customer, chances are there that the return trip will include long hours, a lonely driver and an empty trailer. After more than 100 years, one problem remains the same: empty trailers running empty miles. India’s transport sector is large and diverse; it caters to the needs of a billion people. With road transportation contributing a majority part in the economy, as informed, it is considered as one of the major sectors in Indian logistics. “Indian transport industry is a rapidly growing sector contributing 6.4 per cent to Indian GDP significantly. The biggest boost to the growth of the industry will be experienced in coming years. The industry will experience an increase by 10 to 15 per cent in next five years developing the stable growth of the country due,” said Akash Bansal, Logistics Head, Om Logistics Ltd. Transportation is the biggest and the most important sector of a country’s economy. As holding a lion’s share in the Indian economy, roads account for 65 per cent of the freight traffic while the railways serve the remaining 35 per cent. But a lot of miles get wasted due to various reason. “Transport sector plays a vital role in our industry, without transport facilities, our cargo industry can’t survive. Vehicle movements on highways and roads are good, but day by day tolls are increasing and additional expenses are incurred in the transportation sector. Moving towards the future, we need to remove all the check post of each and every state. As of now, each state is having check post with one counter only. Still, if they need check posts in place, they should increase the check posts like tolls booths,” opined Dileepa BM, CEO- Bonded Trucking, Shreejee Transport Services LTD.
Understanding the Concept of Wasted Miles Since the dawn of the trucking industry, wasted miles have been a serious issue which affects the whole industry. As transportation plays a pivotal role being the backbone of the economy, the issue is important to ponder on. Technology has been a game changer in the industry to bring more efficiency in the industry. Sheena Sachdeva, with the help of a few industry experts, brings light to the concept of empty backhaul miles.
10 CargoConnect - April 2017
As a common affair in road transport, a lot of miles get wasted in the process of transportation. Another survey done by TCI on the Kolkata – Mumbai route shows that the vehicle took eight days to reach Mumbai with 32 hours or 16.67 per cent of the transit time wasted at various check-posts and the average speed of the vehicle was merely 11 km per hour. It is estimated that check-post delays cause `9-23 billion (USD 180-460 million) loss (not taking into account fuel expenses due to slow speed and idling) in a year and unofficial payments amount to `9-72 billion (USD 180 million- 1.44 billion) in a year. According to another estimate, fuel worth `100-150 billion
SPECIAL feature (USD 2-3 billion) is wasted on highways and check-posts annually. A vehicle that costs `1.2 million (USD 24,000) pays `300,000 (USD 6,000) per annum in the form of various taxes, which include the excise duty on fuel. This is why freight cost is a major component of the cost of a product in India. The average speed of trucks on Indian roads is about 20 km per hour. On Indian roads, a truck travels for 20 days a month v/s 25 days in developing countries. In India, truck covers 250-400 km per day, while 700-800 km in developed countries. Annually, a truck on Indian roads can cover 60,000-100,000 km while in the US a truck can travel up to 400,000 km. “Wasted miles in transport industry occurs when excess transportation occurs in freight operations. Such wasted miles usually happens due to empty backhaul miles (transportation from rail or roads), circuitous routing, multi-drop loads, physical attributes of supply chain network besides miscalculated routes, bad weather, road construction, etc,” emphasised Prof Sanjay Gupta, Professor of Transport Planning, Head of Urban Planning Department, School of Planning and Architecture, New Delhi. Indian truckers also face problems due to poor road conditions and check-post delays. The average speed of trucks on Indian roads is about 20 km per hour, including all stoppages. The slow speed of trucks results in poor service quality in terms of reliability and ontime delivery. While low rates-poor quality is acceptable for low-value commoditylike items, for high-value, perishable and time-sensitive items poor service quality is definitely a cause for concern. Prof Gupta further adds, “It can negatively impact in terms of unnecessary traffic congestion, increased air pollution and energy consumption, a decline in road safety
Jahnavi Gokulakrishnan Senior Research Analyst, Transportation and Logistics Practice, Frost and Sullivan
Trucking industry is the key enabler to provide this information to the business entities concerned including shipper, buyer, vendor, manufacturers among others. The trend in the industry is pro-active adoption of technology to reduce ‘dead miles’, improve efficiency, capture and provide shipment location and status data.
planning and the right technology, we can help to reduce it. Though empty running is inescapable in many situations, and hard to avoid in others in freight transport operations, it is important to streamline vehicle routes, including minimizing empty backhaul miles and circuitous routing to minimize wasted miles.” “Mostly truckers face wasted miles due to state permits for vehicles. It is suggested that commercial vehicles should have uniform road tax all over India. To avoid road tax of each state, trucks move with longer distance which is considered to be wasted miles. For example, from Bangalore to Chennai, a truck can move in two ways. One is via Andhra and directly enter Tamil Nadu. If you move via Andhra we have to pay Andhra Pradesh Road Tax and which is seven to eight hours journey from Bangalore to Chennai. Similarly, we can go to Chennai via Hosur without entering Andhra which takes eight to nine hours. If the permits are on all India basis, then there is no need to worry. Vehicles can enter any states without state permits. So vehicle entry permits should be on all India basis,” reiterates Dileepa.
How to curb Wasted Miles and severely affecting the productivity of transport industry. It is estimated that in the U.S., commercial trucks drive 19 billion needless miles each year, clogging roads, wearing down infrastructure and burning fuel. According to statistics from the Department for Transport (DfT), the percentage of U.K trucks running empty has been on the rise in recent years increasing from 26 per cent in 2001 to 29 per cent in 2014. Empty running is a necessary feature of logistics and freight operations, but together with better
In current scenario wasted miles is a natural tendency happening in the transportation to save from the long hour queues of tolls. With thorough study in order to find a solution, Prof Gupta adds, “There is a need for more efficient deployment of the core fleet on existing flaws which is the most effective way to reduce empty running. Technology including routing and scheduling software together with telematics is key to help transport managers achieve efficiencies. Multi-site route optimization software enables vehicles at multiple sites to be treated
GVA (Rupees in Crore) at current prices Sector 3.22 Road Transport
2011-12
2012-13
2013-14
% share
2014-15
% share
260,888
303,132
334,086
3.19
-
-
april 2017 - CargoConnect 11
SPECIAL feature “Indian Transport industry is rapidly growing sector contributing 6.4 per cent to Indian GDP significantly. Industry will experience an increase by 10 - 15 per cent in next five years developing the stable growth of the country due” Akash Bansal, Logistics Head, Om Logistics Ltd
as a single integrated transport resource. This interworking of multiple fleets generates route plans with efficient backloads so that movements to and from different depots can be combined into optimized routes that reduce overall empty running. Telematics includes long distance transmission through computerized information, reduces miles driven by
try something different. He signed up with a year-old truck logistics startup LetsTransport to move packages. LetsTransport provided something Delhivery had been struggling to do for years: It let Delhivery track the trucks on a real-time basis and helped with invoicing. Jahnavi Gokulakrishnan, Senior Research Analyst, Transportation and Logistics Practice, Frost and Sullivan added, “Since
shipment location and status data. “I get a notification every time the vehicle reports to our warehouse. Most important, whenever a truck breaks down, we get an alert in half an hour,” says Jash. Being from the space of trucking industry, Dileepa advises, “Some things never change and some things change faster than others. So it goes with trucking industry and so it will go in 2017. TAT reduction will be new change with adoption of drivers management methodology. As the same vehicle will move on with shift change of drivers from place to place for ensuring drivers safety and comfort. Customised vehicles designing will be next great step for optimum utilization of vehicle. These latest trends happening will improve efficiency reducing challenges in the industry.” Even incorporation of GST from April
Parameter
Unit
Minimum
Maximum
Average
Distance
Km
2,060
2,322
2,155.83
Hours
80
166
102.18
Km/hour
12.98
29.03
21.73
Mileage
Km/Lt
3
4.11
3.6
Loading/documentation time
Hours
1
5.5
3.06
--
18
38
25.30
Hours
2.75
8.78
5.16
Hours/km
0.0013
0.0042
0.0024
Journey time Average speed
No. of stops Stoppage delay Stoppage delay per km optimizing routing and eliminating offhours usage or unauthorized usage. A lowcost shared technology solution, empty miles provides shippers and carriers with opportunities to reduce empty backhauls. The web-based service matches carrier availability (empty miles) with transportation demand (loads) and is delivered through membersonly. Many software management tools are available to help reduce empty miles by finding additional freight to haul given each fleet’s capabilities with routes, equipment, time, and other variables.” Since it started operations in 2011, e-commerce logistics service Delhivery was dependent on local truck operators and drivers to transport its shipments within cities. Last year, however, its fleet manager in Bengaluru, Manobottom Jash, decided to
12 CargoConnect - April 2017
the advent of taxi-aggregators such as Ola, Uber, etc., technology has gained importance to the extent that the industry understands that technology in the current day scenario is at the core of staying and functioning in the industry vis-à-vis only gaining an edge over the competitors about ten years back. Supply chain visibility has become the need of the current age market across industries. While forecasting and planning tools are becoming sophisticated, data is a crucial component that includes real-time shipment location and status. The trucking industry is the key enabler to providing this information to the business entities concerned including shipper, buyer, vendor, manufacturers among others. The trend in the industry is pro-active adoption of technology to reduce ‘dead miles’, improve efficiency, capture and provide
2017 shall further deteriorate not only the time but also the cost in the industry. Due to trade barriers such as entry taxes, local body taxes, OCTROI and other hurdles, trucks lie idle for 30 to 40 per cent of the time as per industry estimates during their delivery schedule. Improvement in the logistic time after phasing out the border check posts resulted in the improvement in operational efficiency through quicker and increased number of deliveries along with the reduction in logistic cost during the transit. As per world bank estimation, Indian corporates can save upto 30-40 per cent of logistic costs incurred due to stoppages at various tolls and check posts. PC Sharma, CEO and Whole-Time Director, TCIEXPRESS informs, “Trucking industry is evolving in multi-dimensions. The long haul trucks are becoming bigger and
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SPECIAL feature “Wasted miles in transport industry occurs when excess transportation occurs in freight operations. Such wasted miles usually happens due to empty back haul miles (transportation from rail or roads), circuitous routing, multi-drop loads, physical attributes of supply chain network besides miscalculated routes, bad weather or road construction etc.” Prof Sanjay Gupta, Professor of Transport Planning, Head of Urban Planning Department, School of Planning and Architecture, New Delhi.
because of GST, it is expected that the check posts and interstate borders to be removed. Once it is removed, the trucking industry will get a great relief as it decreases the time lag and ensures better and faster delivery of goods. We can increase the number of trips and it will add to the productivity of the whole industry.”
How technology can be game-changer for Trucking Industry? Technology is a key to bring metamorphosis in the trucking industry. “Technology can be one of the game changers in the trucking sector in the coming year. Only through electronic systems, it can be monitored,” Dileepa informed. Bansal, on similar lines, said, “I think technology will change the industry in ways we don’t even know yet. As we already know, technology offers significant advantages in reducing wasted miles, increase speed and efficiency
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of reducing theft. Strategical use of technology also reduces damages to loading/ unloading recordings.” Technologies in the form of smartphone and tablet apps that are tailor-made to increase load efficiency for those in the trucking industry are increasingly gaining importance. Transfix is one of many new apps on the market that is designed to improve dispatching, routing and short loads for OTR truckers. The app pairs truck drivers with available loads using automated matching. Truckers can pick up loads along their current route using Transfix, which is also available in website format. Everything from payment to the customer to the transfer of paperwork is handled electronically. This is especially ideal for owner operators and independent truckers who want to make their own trucking businesses more efficient. Drop-and-Hook, which is a method to organize transport to eliminate empty miles and optimize performance, where “drop” refers to delivering a trailer and dropping at the customer site (or a distribution center), and “hook” refers to immediately hooking up a loaded trailer and moving it to the destination. Logistics Information Platform (also Freight Exchange) matches freight with available vehicle space. Haulers and truck drivers can search online for available freight – or post their available transport capacity. Similarly, freight forwarders can offer freight for transportation, or search for suitable vehicles. Multimodal transport, which refers to the carriage of goods by at least two different modes of transport on the basis of a multimodal transport contract from a place at which the goods are taken in charge by the multimodal transport operator to a place designated for delivery. Bansal, sharing his views on this, added, “Efficiency involves saving time, cutting costs, and making OTR as well as local truck driving jobs easier. Reduction in wasted miles can definitely increase efficiency. Magical formula for increasing efficiency marks introducing new hubs in various states will offer comprehensive access for cargo movement, movement of trucks through outer highways, improving the use of navigation and reduction in tolls will help as a quick fix to reduce wasted miles in the trucking industry. However, there are three main areas where you can improve your position whether you are behind the wheels or desk-load, fuel, and drivers’ efficiency.”
Given are further pointers on how technology can bring a significant change to the industry: Aviral Consulting Pvt. Ltd. Mumbai Phone: 9969648088 | Email: contact@aviralconsulting.com
Telematics: Commercial Vehicle Telematics (CVT) combines onboard computing, location technology (based on the global positioning system or GPS), and communications
SPECIAL feature
“Trucking industry is evolving in multi-dimensions. The long haul trucks are becoming bigger and because of GST, it is expected that the check posts and interstate borders to be removed.” PC Sharma, CEO and Whole Time Director, TCI Express
the tractor and trailer will result in fuel efficiency improvements. A 25 per cent reduction in drag could generate between a five per cent and 15 per cent reduction in fuel consumption. iv. Powertrain: The big trends in the powertrain such as downsized engines, alternative fuels and electrification, automated manual transmissions and the increased use of 6x2 axles shall improve vehicle performance and overall efficiency v. Anti-idle devices: Idling those engines in order to keep a truck’s engine block warm leads to a huge diesel consumption. Devices such as direct-fired heaters and auxiliary power units can New reduce such fuel waste by at age trucks tagged least 75 percent. vi. Tires: Improved tire design as “value trucks” with can lead to an increase in fuel powertrain and advanced efficiency by about six per cent. electronics under their hood vii. 6×2 transmission systems: are going to find their way A 6×2 transmission in regions in the fleet of trucks. with moderate weather can result in substantial fuel savings during the lifetime of a truck are a possibility roadside receivers/transmitters to relay data viii. Advanced cruise control: Adaptive cruise control is an option that could improve fuel from moving vehicles. efficiency and safety by adapting a truck’s ii. Safety Technology: There are eight major speed based on traffic conditions. safety technologies in use or under development in the trucking industry viii. GPS assisted routing:. GPS devices that can provide real-time traffic updates and globally, namely antilock braking systems, historic traffic data can become especially stability control, lane departure warning, advantageous for intra-city trucking and collision avoidance systems, blind spot can pay off big dividends when scaled. warning devices, interior cameras, rear view cameras and side monitor cameras and sensors, which will enhance safety in Trends in Trucking Industry truck operations Good physical connectivity in the urban iii. Fuel Efficiency: Fuel savings is a major and rural areas is essential for economic concern in the trucking industry. growth. Since the early 1990s, India’s growing Aerodynamic improvements to both economy has witnessed a rise in demand for technology would lead to improving fleet operations through better asset and resource management. Vehicle-to-vehicle communication will enable platooning, increase safety and act as a platform for intelligent transportation systems. Digital Short Range Communication will enable
16 CargoConnect - April 2017
transport infrastructure and services. However, the sector has not been able to keep pace with rising demand and is proving to be a drag on the economy. Major improvements in the sector are required to support the country’s continued economic growth and to reduce poverty. Gokulakrishnan, informs about the major trends in the trucking industry such as the adoption of data management solutions such as Fleet Management Systems, Transport Management Systems, etc. to capture, collate and analyze location and status information of the shipments during transit, increased usage of smartphones to assess the availability of transport capacities across the network. She emphasizes that this is reducing time-consuming inspections, analysis, and inefficiencies caused due to lack of supply chain visibility. Globally some of the major trends happening in the trucking industry are the increasing use of technological application in improving freight transport productivity and customer satisfaction. Some of these tech gadgets in use are: a. Electronic onboard recorders and e-logs b. Apps like Transfix, Convoy and Truck Chat c. Chat boards and online forums encouraging truckers to share trucking advice d. GPS systems and smartphone mapping programs for routing In India, the driver owned fleet is catching up which removes route and freight fixation and bring in the much-required flexibility in the system. In addition, these drivers want comfortable driving cabin space, better incabin such as music systems, phones and above all better income. The new generation transporters, estimated to be around 15 per cent, are likely to employ use of trackers, smartphones, freight data, fuel proliferation sensors, etc. New age trucks tagged as “value trucks” with powertrain and advanced electronics under their hood are going to find their way in the fleet of trucks. The new arrays of machines launched by global majors such as Tata Motors, VECV, Volvo and Bharat Benz in India with telematics and other features not only add to the driving comfort but more importantly adds on to “dignity of the job” which would also help in solving the acute problem of driver unavailability. Further development and modernization of highways
SPECIAL feature “Mostly truckers face wasted miles due to state permits for vehicles. It is suggested that commercial vehicles should have uniform road tax all over India. To avoid road tax of each state, trucks moving with longer distance which is considered to be wasted miles.” Dileepa BM, CEO-Bonded Trucking, Shreejee Transport Services Pvt Ltd
in the country coupled with stringent implementation of regulations prohibiting overloading practice and incorporation e-tool booths with weighing bridges would overall benefit the transport industry. The country would also witness greater development and scale-up of online truck logistics players such as LetsTransport, Porter, etc. which would slowly shift the trend from unorganized trucking business to streamline the segment. Some of the major technology trends which have started happening with the new generation transporters in India and which may accelerate in near future keeping in view their immense potential would be in following areas: ·GPS-based transportation management systems (vendor management, rate comparison, scheduling and tracking, analytics) ·Analytics for demand and supply mapping (dynamic scheduling based on capacity, availability, distance and idle time) ·Automation: Mobile and Web Apps (registration, ordering, LIVE tracking, deviation alerts, delivery time estimations, invoicing, payments) ·Customer Analytics (CRM) ·IoT (safety and maintenance) Prof Gupta, gives us a deep insight on the trends in the trucking industry by saying, “The total number of trucks registered in India is around 44.88 lakhs. The trucks plying on roads could be broadly categorized into three categories- trucks with inter-state permits, trucks with intra-state permits and trucks plying on rural roads and within city limits. It is estimated that currently a little over 22 lakh trucks provide inter-state services while the rest are plying on intrastate roads or within city limits and rural roads. With six million truck drivers in India, the trucking industry represents a notable
18 CargoConnect - April 2017
proportion of the labour force (2.5 per cent). The truck operation is highly fragmented with only 17 percent of the operators having more than ten trucks. Also, smaller trucks outnumber the big ones; 48 per cent of all trucks are under 15 MT. Around 75 per cent of the trucks on Indian roads are two-axle trucks with a capacity of nine tonnes. Two and threeaxle rigid trucks constitute the bulk of trucks in India. About 40 per cent of Indian trucks
Wasted miles in transport industry occurs when excess transportation occurs in freight operations. Such wasted miles usually happens due to empty backhaul miles (transportation from rail or roads), is less than six years old, while 34 per cent are older than ten years. The average truck is operational for about 20 years, after which it is scrapped .A truck plying between states with freight covers on an average around 280-340 km in a day, which is much below the distances covered in developed countries. Further, it is estimated that around 37 per cent of trucks spends between five to eight days per trip while on inter-state service, 26 per cent take more than eight days to return to their originating point. “Emerging trends reveal that the share
of three-axle trucks and light commercial vehicles is on the rise. The truck production in India, influenced primarily by rising domestic demand but also by growing exports, will be more than double. Indian manufacturers are already targeting the world with their new products, and are upgrading existing portfolios with new models developed in collaboration with many global suppliers. The demand in the new emerging markets for budget trucks will give Indian manufacturers confidence and support their export efforts.Their first production sites abroad will also help the Indian manufacturers to capture emerging markets for their trucks. It is estimated that the potential for the Indian truck industry is for ten per cent of its production to be exported by 2020”. The concern about climate change, coupled with environmental regulation, shall lead to a new level of commitment to increase fuel efficiency and reduce emissions with implications for cleaner and energy efficient technology in manufacturing of trucks. Persistent air pollution, particularly in major cities, could ultimately lead to less penetration of heavy trucks in urban limits and a greater emergence of lighter vehicles for distribution of goods. Implementation of city logistics strategies shall witness the emergence of multi-modal freight transportation with line haul heavy trucks bringing goods from the region to city where these are transferred to smaller vehicles at the freight consolidation centers on the periphery for distribution within the city. There shall be the emergence of App for optimizing freight loadings and minimizing waste mileages in a big way in major urban centers of the country which would lead to an emergence of efficient and environmentally friendly small and medium sized trucks for freight distribution. Indian cities shall also witness collaborative freight logistics platforms for freight deliveries which will result in the emergence of a more organised trucking industry structure with its associated benefits of better truck productivity and enhancement of human resource development in the trucking industry.
cover story
20 CargoConnect - April 2017
cover story
India is emerging as the world’s largest middle class consumer market with an aggregated consumer spend of nearly US$ 13 trillion by 2030, as per a report by Deloitte titled ‘India matters: Winning in growth markets’. This news is fuelled by rising incomes and growing affordability. The consumer durables market is expanding for consumer durables such as refrigerators, and consumer electronic goods in the urban and rural markets in India. It is expected that India will have the fifth largest consumer durables market in the world by 2025. To balance the equation between its ever growing demand and increased supply, logistics has always played the pivotal role. Tariq Ahmed tries to dig into the world of transportation of consumer durables with the help of industry experts.
april 2017 - CargoConnect 21
cover story
G
lobal corporations view India as one of the key m a rke t s f r om whe r e future growth is likely to emerge. The growth in India’s consumer market would be primarily driven by a favourable population composition and increasing disposable incomes. A recent study by the McKinsey Global Institute (MGI) suggests that if India continues to grow at the current pace, average household incomes will triple
Urban markets will demand for non-essential products such as LED TVs, laptops, split ACs and beauty and wellness products and the rural markets may increase their demand for durables like refrigerators as well as consumer electronic goods in the coming years as the government plans to invest significantly in rural electrification. The demand from rural and semiurban areas is projected to expand at a CAGR of 25 per cent to US$ 6.4 billion and it will likely to contribute majorly to consumer durables sales. Only television sales in India is third largest in
Size of the consumer durables market (USD billion) 20.6
inside CAGR: 13% 12.5
About Consumer Durables Entrusting the 3PL Route Management Strategy Inventory management The Theory of Supply and Demand Consumer Durables and GST: A whole new chapter 22 CargoConnect - April 2017
3.5
3.8
4.2
4.7
5.2
6.3
7.3
7.3
7.4
9.7
Source: Electronic Industries Association of India, CAGR – Compound Annual Growth Rate, Note: (F) Forecasted E: Estimated
over the next two decades, making the country the world’s fifth-largest consumer economy by 2025, up from the current 12th position. The Indian consumer segment is broadly segregated into urban and rural markets, and is attracting marketers from across the world. According to a report by Boston Consulting Group (BCG) and the Confederation of Indian Industry (CII), India’s robust economic growth and rising household incomes would increase consumer spending to US$ 3.6 trillion by 2020. The maximum consumer spending is likely to occur in food, housing, consumer durables, transport and communication sectors. The report further stated that India’s share of global consumption would expand more than twice to 5.8 per cent by 2020. Urban markets account for the major share (65 per cent) of total revenues in the consumer durables sector in the country.
the world and growing with a CAGR of 16 per cent and is expected to go to US$ 14.7 billion my 2018. Moreover, online retailing is also expected to grow up to US$ 8.08 billion industry by 2016, as per rating agency Crisil. Crisil also estimates that online retailing, both direct and through marketplaces, will grow threefold to become a `50,000 crore (US$ 8.06 billion) industry by 2016. Also, the growth in Internet retail is expected to boost offline retail stores.
About Consumer Durables: Consumer durables refer to those consumer goods that do not quickly wear out and yields utility over a long period of time. Some of the popular and common examples of these kinds of items are electronic goods, kitchen appliances, home furnishings and leisure equipments etc. Consumer durables can be broadly categorised into the following three heads:
Logistics through innovation, dedication & technology...
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JWC logistics Park Pvt Ltd, National highway 17, Panvel Goa Highway, Village Palaspe, Panvel, Maharashtra - 410206 2143- 661952 2143-661900 (100 lines) krutijobanputra@jwclogic.com jwccfs@jwclogic.com jignesh@jwclogic.com
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The logistics players design their working based on the Fixed and Floating Space model. As per the customer needs and requirements, we decide the floating and fixed spaces. The floating spaces are meant for such seasonal gaps created in the demands of durables. Dinesh Singh, Chief Mentor, Dexters Logistics Pvt Ltd
White Goods
Brown Goods
White goods mainly include air conditioners, refrigerators, washing machines, audio equipments and speakers This kind of consumer durables mostly include kitchen appliances like chimneys, electric fans, grinders, iron, microwave ovens, mixers and varied other cooking ranges
It is said that when it comes to transportation of the consumer durables withinthe same city or between two or more cities, it is always best to trust the good old 3PLs. But obviously, there is no thumb rule to this. You can have
the network consists of a few large Regional Distribution Centres in addition to smaller facilities at State level. Traditionally, local distribution was being managed by Carrying and Forwarding Agents (CFA). However, the trend has been changing, driven by large consumer durable players where we are seeing consolidation happening with business being outsourced to large organised 3PLs having regional or national footprint. Kapil Premchandani, MD, KD Supply Chain Pvt Ltd opined that the consumer durables industry is essentially a push industry and hence the dealers play an
your own logistics support or you can always outsource the last leg of the supply chain. The role of logistics is extremely crucial in this industry. Consumer durables are bulky products that need a lot of care while transportation. This is all the more crucial in India, given the poor road conditions. This is one of the main reasons why the rural market is yet to be fully explored and exploited. With the growth of newer channels such as E-commerce, logistics will become one of the key factors for the growth of this industry. The logistics support function for the Consumer Durable industry is generally outsourced. Due to the prevailing tax regime,
important role. Therefore, the supply chain needs to be structured in such a manner where the players will be able to service the dealers. He said, “In case if a company decides to manage their supply chain on their own, they will have to build warehouses in every nook and corner of the country. But this is not an easy task and companies have to look at the feasibility before taking such a huge step. Therefore even major players in the consumer durables industry prefer to work with 3PLs in order to cut on logistics cost.� Due to tough competition among the big players in consumer durable segment, they would like to focus more on their
tvs and 13 per cent air conditioners. The growth of individual product shows that the demand for air conditioners (20-25 per cent), televisions (15-20 per cent), VCDs (30 per cent) and microwave ovens (25 per cent) are increasing. Of course, microwave and air conditioners are the products for urban areas.
Entrusting the 3PL:
TVs, DVD players, DVD movies, iPods, video games, Consumer Electronics remote control cars, telephones, cell phones, laptops, etc.
Some of the top consumer durables brands in India are: LG, Nokia, Philips, Samsung, Sony, Whirlpool, Blue Star, Carrier, Godrej India, Hitachi India Limited, Sharp India Limited, Tata, Toshiba India Private Limited, Videocon, and Voltas etc. Increase in disposable income, growth of organised retail sector, increasing affordability of products and availability of easy finance scheme boosted the consumer durables demand in rural India also. The production of consumer durables was 1.8 per cent to GDP in 2005, reached 12 per cent in 2015 shows the increasing demand from all segments of the society in India. The share of key consumer durables is 34 per cent others, five per cent washing machines, 18 per cent refrigerators, 30 per cent colour
24 CargoConnect - April 2017
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As a logistics specialist, we can offer our customers efficient and flexible solutions, in a moving environment. With a growing market in India and with the GST coming up, who knows where the DCs will have to be located in the next two to three years. Jean Christophe Machet, Global CEO, FM Logistic
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core competent area like R and D, pushing the sales through advertising, customer service, product upgradation, after sales support, etc., instead of putting their heads in to logistics support. Since expertise 3PL service providers are available in the market specialised in handling white goods more efficiently with the latest tools and technologies, most of the consumer durable companies are utilizing 3PLs for their logistic support. P.S Kasi Viswanathan, CFO, ProConnect, talking in the same context, said, “The order of the day is to do what you are good at and leave the rest to the people who are experts in their own domain and this applies to the Consumer Durables space as well. Next comes cost, with the competition increasing day by day and with their margins being thin it will be prudent for the big players to operate through 3PL model to reap the cost benefits derived through scales of operation. Barring a few who chose to operate through their own setup for reasons, majority of the players
26 CargoConnect - April 2017
Setting up of EHTPs
Increasing liberalisation, favourable FDI climate
Resulting in
Policies like National Electronics Mission
have chosen the 3PL route and the others too will change to 3PL model soon too. We at ProConnect and Rajprotim, have been doing the end to end 3PL supply chain services for many prominent multinational consumer durables companies which is a testimony by itself that they are in need of 3PLs.” Jean Christophe Machet, Global CEO, FM Logistic believes that every company should fol low their own methods of distribution. He said, “We really believe that the core business of such players is product development, manufacturing, marketing and sales. As a logistics specialist, we can offer our customers efficient and flexible solutions, in a moving environment. With a growing market in India and with the GST coming up, who knows where the DCs will have to be located in the next two to three years. It is always risky for industrial companies to invest in their own logistics network. As a logistics provider, with more than 75 sites in India, we can be more agile and offer more flexible solutions.”
Expanding prod./distn. facilities in India
Increasing investments
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Providing support to global projects
Route Management Strategy: The basis for route optimization is the use of models to describe the transport network that needs to be planned. When building a model, the scope of the overall network needs to be defined, ensuring that all the data is included, such as regulations or highway problems. The model has a number of components such as products, vehicles, and personnel. The product moves from one geographic location to another, often described as the origin and the destination. The product will be defined by its weight and its volume, which are important factors for shipping. A transportation network within the model can be divided into a number of sectors which is represented by a vehicle, which moves between an origin and a destination location. Each vehicle may have different attributes such as volume or weight capacity, loading times, cost per mile, and vehicle limitations, i.e. speed of the vehicle. The personnel assigned to the model have characteristics that are governed by the
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In case if a company decides to manage their supply chain on their own, they will have to build warehouses in every nook and corner of the country. But this is not an easy task and companies have to look at the feasibility before taking such a huge step. Therefore even major players in the consumer durables industry prefer to work with 3PLs in order to cut on logistics cost. Kapil Premchandani, MD, KD Supply Chain Pvt Ltd
KEY MANUFACTURING PLANTS OF CONSUMER DURABLES ACROSS INDIA EAST: West Bengal is a major hub for Videocon and Phillips. In 2015, Whirlpool announced to invest USD3.28 million to set up exclusive showrooms
NORTH: Delhi and Uttarkhand are the key consumer durables manufacturing hubs in North India. Panasonic has set up its plant in Jhajjar, In 2015, the Taiwan Electrical and Electronic Manufacturers’ Association (TEEMA) has announced to invest USD200 million in electronics manufacturing sector in Uttar Pradesh
WEST: Maharashtra and Gujarat host units for LG, Videocon and Samsung. In 2015, Videocon announced that it has been planning to invest USD328 million in Gujarat for manufacturing facilities
SOUTH: Tamil Nadu hosts manufacturing facilities for a number of leading firms. In 2015, Thomson announced to invest USD49.13 million in manufacturing facilities in Telangana
Source: TechSci Research
type of work they perform. Management can alter the vehicle data to allow them to select more efficient or larger vehicles to produce more economical routes. By modifying the personnel or modifying their start and finish times, the route can be altered to take advantage of less busy times of day on the freeways. By altering the variables in the model, the most efficient use of the company’s resources can be achieved. Sumit Sharma, Co-founder, GoBolt said, “Manual route planning has been employed by companies for many years and despite the experience of the route planners, the ever-changing complexity of today’s transportation network can affect the financial validity of a route from day to day.
28 CargoConnect - April 2017
By modeling the transportation network, management can constantly monitor the small changes that affect the network in a real-time environment allowing changes that keep the most efficient and economic route planning. Logistics firms that operate their own fleets, tend to use a route plan that has the vehicles starting and ending at the same location. This ensures the minimum repositioning of vehicles and personnel. However, to develop routes that cover all deliveries and pickups to and from numerous customers is extremely complex and to develop the routes that are most efficient is becoming increasingly difficult.” Naveen Rawat Director- Business Development, Holisol is of the view
that the transportation function is still being handled in the traditional way, with long distance trucking happening through multiple trucking companies or aggregators. He said, “Things have started gradually improving with the emergence of new players focusing on overall technology enablement in the trucking sector. On the Last Mile Delivery, especially on the direct to consumer deliveries the service providers have started deploying technologies for route optimisation and real time visibility of the package status.” Meanwhile, Sunil Kumar, MD, Everfast Freight has a very strong point to make in this context. He said, “On a daily basis, or in the day to day scheme of business, consumer
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The present scenario is basically profitable for the domestic market only. I don’t think that a freight forwarder or an international logistics player is much affected by consumer durable industry. Though, it might have a significant impact on the aviation industry and the domestic players. Sunil Kumar, MD, Everfast Freight
durables does not have a major role to play in the international logistics segment as more and more multinational brands are coming in, who follows their own pattern of logistics. The present scenario is basically profitable for the domestic market only. I don’t think that a freight forwarder or an international logistics player is much affected by consumer durable industry. Though, it might have a significant impact on the aviation industry and the domestic players.� The whole transportation in this segment
work on a very cost effect methodology. These product has a very high weight volume ratio and hence it is very mandatory for them to mend and control their cost, looking on to this many CD companies has custom made vehicles to accommodate the goods at lowest cost per pieces for primary distribution. Apart from that further to enhance their cost effectiveness and faster to be on rack they and made more than one warehouse in one state for secondary movement to also ascertain the less in transit damages.
Inventory management: Whether you stock goods for sale or supplies to run your business, controlling your inventory can improve your bottom line. Inventory can be one of your largest expenses, right behind payroll. If you make sure you only store what you need when you need it, you can keep more of your cash for investing in your business growing it. No matter what warehousing and inventory system you use, it should accomplish some basic functions. You need to be able to inspect the quality of
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The transportation function is still being handled in the traditional way, with long distance trucking happening through multiple trucking companies/aggregators. Things have started gradually improving with the emergence of new players focusing on overall technology enablement in the trucking sector. Naveen Rawat, Director- Business Development, Holisol
THE CONSUMER DURABLES MARKET IS SPLIT INTO TWO KEY SEGMENTS Consumer durables
Consumer electronics (brown goods)
Consumer appliances (white goods)
Televisions
Audio and video systems
CD and DVD players
Personal computers
Laptops Electronic accessories
Air conditioners Washing machines Electric fans
Digital cameras Camcorders
Microwave ovens
Refrigerators Sewing machines Cleaning equipment Other domestic appliances
Source: Electronic Industries Association of India, TechSci Research
shipments when they come in and re inspect them when they are stored and retrieved. Your warehouse management system should provide you with an inspection area for when shipments arrive. Inventory personnel can inspect the shipment for damage and make sure it contains the items ordered. Once the stock is stored, you should be able to access it easily to look for damage and to check expiration dates, if applicable. This process can be repeated when employees retrieve inventory. These processes allow you to ensure the quality of your inventory so you can use it for its intended purpose. “Gone are the day when business use to revolve around metros, with a population of 125 crores where more that 80 per cent resides in Tier I, Tier II and Tier III cities.
32 CargoConnect - April 2017
Industry had understood the need to be available in those parts of the country majorly due to two reasons. Firstly, the prices are very competitive as compared to class 1 cites, and secondly, infrastructure and connectivity had excelled. In past five years there had been really an upright development at warehouse front in these cities and we can expect the development in these cities at par to Tier I cities in another 3-4 years,� says Dinesh Singh, Chief Mentor, Dexters logistics Pvt Ltd. Presently not much of quality warehouses are available in Tier II and Tier III cities in the market. It will be not okay to say that there are no warehouses in the Tier II and Tier III cities but the need of the hour is well managed cost effective and efficient set ups and this
will only happen with volumes warranting the same. Demand supply gap can also be well managed if you can reach the stock overnight and setting up forward stock locations that can address majority of the need by an overnight delivery addresses your majority requirements. We are trying to build state of the art facilities in such cities. In cases of long leased warehouses we are building them with good infra such as wifi enablement, racking, dock levelers etc. With a brilliant forecasting and buying pattern, companies do maintain necessary inventory at their warehouses around. Since warehousing and inventory management are more important to ensure on the right time, on the right place with the right product. Failure on this may kick-off the product out from the market. For this, having
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As interstate transactions will become tax-neutral, the focus should now shift to supply chain efficiencies. For instance, consolidation of existing infrastructure through setting up of large warehouse with regional distribution hubs will lead to better inventory management. Nitish Singh, CFO and Co-founder, Jugnoo
meant for grain or agricultural produce and are not the best option for the storage and handling of consumer durables. He adds, “Growing need for warehousing in these towns has also resulted in mushrooming of new facilities but given the unorganised nature of the warehouse developers these new facilities lack design and construction quality. Usually, these warehouses are just the four walls without any consideration paid to best or even good practice that should be followed while constructing a warehouse.”
The Theory of Supply and Demand warehouse in Tier II and Tier III cities are pretty important. Vishwanathan said, “The warehouse location must be well connected to the respective regional and nationwide traffic network. Jumbo trucks as well as sea containers can easily access to the area.Being an end to end supply chain service provider, ProConnect is having more than 173 warehouses across India and most of our warehouses are located in Tier II cities and many in Tier III cities too.” You can account for damage and losses with a good inventory system. You need to not only identify damage; you also need to place a value on the unusable item. Inventory pieces can have different values depending on when you ordered them, so your labeling and tracking should tell you exactly how much you paid for each unit. Then you can show the exact expense of any loss. Use this figure when calculating your net income. Sumit says, “Your inventory losses count as an expense of doing business. You may think it’s time to reorder inventory when, in fact,
34 CargoConnect - April 2017
you have the items already in stock. Knowing where units are located can prevent double ordering. If your warehouse personnel simply put new items in the first available space and don’t make note of the storage location, you may not realise what you have on hand. When you need your inventory, staff must be able to retrieve it quickly and efficiently. The less time a stock picker spends looking for an item, the less you pay in wages for retrieval. Also, timely filling of orders can improve your customer service. After all, the purpose of storing inventory is to have it readily available. If your warehousing system interferes with that availability, you are defeating the purpose for warehousing your stock.” Naveen points out that there are a multitude of storage facilities primarily
Nature of demand for durable goods is of special interest in demand theory. Demand for durable goods is more volatile than the demand for non-durable goods. In economics durable goods are defined as those goods that go on yielding services to the consumers over a number of periods in future. Further, because of their durability they can be stored for longer periods of time. It is due to the use of services of durable goods for a relatively long term that consumers’ demand for them is more volatile, that is, fluctuates very much. Now, what accounts for the large volatility in demand for durable goods? First, since durable goods can be stored, producers, distributors and consumers usually keep a large inventories of such goods. Therefore, increase in demand for them may not show up in more production of such goods for quite some time because the greater demand for them can be met by drawing upon their inventories. On the other hand, when inventories of durable goods are low even a small increase in demand for them by their consumers may actually lead to greater market demand because producers and distributors would
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We at ProConnect and Rajprotim, have been doing the end to end 3PL supply chain services for many prominent multinational consumer durables companies which is a testimony by itself that they are in need of 3PLs. P.S Kasi Viswanathan, CFO, Proconnect
also tend to increase their demand for holding more inventories to accommodate their large demand in future. The ot he r factor re sp on sible for volatility in demand for durable goods is that replacement of these durable goods can be deferred by undertaking additional maintenance expenditure on existing durable goods possessed by them. For example, an old car may be got replaced or its old model may be used for a longer period. Similarly, the purchase of new furniture may be postponed by tolerating the use of old furniture for one more year. According to Vishwanathan, “Consumer Durable business is mostly seasonal. There is a tremendous growth during festival period and during summer seasons (for ACs). Enough inventory is been maintained to handle this peak and our operations are geared to handle this. There is a pattern to how a particular market and geography demands increase and we have learnt that with the past experiences and work, our plan is aligned to that to meet demand. Better space optimization in the warehouse with multilayer stacking and having
36 CargoConnect - April 2017
mezzanine floors to improve the floor space utilisation helps meet out seasonal surge in requirements.” While strategic and project management aspects of change are key, it’s the people aspects of managing change that can trip you up. Here’s how to win the support you need throughout the organisation. Whether you’re implementing a new warehouse management system or completely redesigning your supply chain, you’ll increase the likelihood of success by paying attention to these do’s of change management: • Choose the right strategy • Beware of misalignment • Identify the right change agents • Control the scope of the change • Identify the change’s negative impact, and address it • Keep a decision history matrix • Understand the human aspect of change • Understand how open your people are to change • Develop and implement a public relations plan According to Dinesh Singh, the logistics players design their working based on the ‘Fixed and Floating Space’ model. He said,
“As per the customer needs and requirements, we decide the floating and fixed spaces. The floating spaces are meant for such seasonal gaps created in the demands of durables. Forecasts are all done by the customer and we as logistics companies enable them to have best inventory management practices and control their cost.” Naveen believes that sales for the consumer durable business is seasonal and event driven in nature with seasons, festivals or sales events driving the volumes up while at other times the volumes are low. “That’s where the logistics solutions players like Holisol add value by planning operations with flexibility as a major element. Providing additional space during peaks or arranging additional vehicles is built as a part of operational plan, hence maximising fulfilment while minimising disruptions,” he asserts.
Consumer Durables and GST: A Whole New Chapter The passing of the goods and services tax bill is a big plus for the consumer durable industry as also for makers of building materials such as tiles, ply board and sanitary ware. First, by reducing the net tax outgo, the new tax regime will lower end-prices of products. Given, that all these industries are looking for a demand-push, the manufacturers are likely to pass on the price benefit. This will stoke revenue growth. Secondly, the GST regime will reduce the price differential between products of organised players and those of their competitors in the unorganised space. In tiles and ply boards for instance, the price difference between unbranded and branded goods is almost 10-15 per cent. So, as the new tax is implemented, more consumers may shift to branded products as the price
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cover story
Your inventory losses count as an expense of doing business. You may think it’s time to reorder inventory when, in fact, you have the items already in stock. Knowing where units are located can prevent double ordering. Sumit Sharma, Co-founder, GoBolt
difference reduces - this is a major advantage for players such as Kajaria Ceramics, Somany Ceramics, CeraSanitaryware and Greenply in the listed space. The other plus of the new tax which players such as Havells India and Whirlpool of India have highlighted is that it will reduce their logistics and inventory handling costs. Share of roads in freight traffic in the country is 72 per cent, indicates the economic survey data of 2015. Thus, as GST replaces the central sales tax on interstate sale of goods and several other levies, costs for manufacturers will come down. It will help companies save on investments in manufacturing facilities too. Currently, goods produced within a state attract lower tax than those produced outside. This forces companies to consider setting up of manufacturing facilities near all their different markets. However, one thing that companies may have to watch out for is whether excise duty exemption zones continue to get that benefit. If not, some companies such as V-Guard Industries and Bajaj Electricals which have manufacturing plants in excise free zones may see costs rise (impact will be lower if tax refund is allowed). Nitish Singh, CFO and Co- Founder, Jugnoo said, “As interstate transactions will become tax-neutral, the focus should now shift to supply chain efficiencies. For instance, consolidation of existing infrastructure through setting up of large warehouse with regional distribution hubs will lead to better inventory management. Companies should work on managing these large warehouses and hubs and leave the last mile to specialised tech logistics like Jugnoo.” The emergence of GST will be a huge
38 CargoConnect - April 2017
opportunity for the organised 3PL players in terms of potential shift of business from unorganised local players to organised large players offering regional and national footprint. The consolidation of few facilities into one bigger facility would also result in demand for more organized and efficient operations, with the help of technology. It would also result in improving the vehicle utilisation, both in terms of capacity and mileage. Both these factors combined have the potential to bring down the overall logistics costs significantly.
With E-commerce penetrating in to Tier II and Tier III, this space will see good amount of growth. With the entry of non popular and cost effective brands coupled with ecommerce, we can see a heavy competition. GST will be the biggest game changer in India be it from a taxation perspective or from a way of doing business perspective, all these days businesses were aligned towards Taxation needs and not on business model basis or on Demand basis. Big warehouses would emerge by eliminating more number of small warehouses across the country. By
reducing the number of warehouses, there would be a possible reduction in primary transportation cost. Also, it helps for better control on WH operation, inventory control, sales planning, etc. and avoids multiple handling of products. On the other hand transportation cost and TAT may go up. This can be offset through better planning. According to Dinesh Singh, “Undeniably, GST is the hot trending topic of the town. And what we believe is that the trend is going to be determined by such tax regimes and associated scenarios. There are two different scenarios, by which one is the current situation or Pre-GST period where the manufacturing units are having warehouses everywhere to avail tax-benefits. So the Dealers or distributors are used with the habit of getting the goods delivered for the raised demands from the market.” With GST, the approach towards the model will change and this will result in consolidation of warehouses and calling for an efficient set up where there is a price advantage and better efficiencies coming their way. This expectation will throw open a push from CFA model to organised 3PL sector model which offers Automated Distribution Centers enabled with the best of breed WMS and MHEs and reach to their customers in the lowest possible TAT. Vishwanathan says, “We have envisaged this requirement and have set up our own ADC in major metros which will bolster our case as a preferred partner in the market, with a well managed transportation wing that has a sizable fleet size that is owned and dedicated. We will also be able to address their TAT requirements and we see the post GST days as a big advantage coming our way and are geared up for the same.”
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focus of the month
Curbing Delhi's Pollution with RoRo
The air pollution scene in Delhi has been taking a toll on people. While the Delhi Government has been making efforts to curb the pollution levels, the centre in the form of the Indian Railways has also decided to lend a helping hand in the form of a new scheme called the RoRo (Roll on Roll off). Nicin Varghese discusses about the newly introduced RoRo scheme by Indian Railways in Delhi.
40 CargoConnect - April 2017
People. Partnership. Performance...
Infrastructure & Advantages Infrastructure Advantages 1) Storage of& 7000 pallet,15 identical chambers of 432 Custom bonded Pallets eachwarehouse. Import & Export hub. 2) Temperature range of +25°c to -25°c Buffer yard & factory stuff. 3) 24x7 Operational Hours Cold storage & cold chain. 4) VAS Facility of Processing, Repacking, Labeling & Storage area 28,000 sq. m. Sorting Direct access to the National Highway 4B leading to the JNPT port. 5) Customs Bonded Ample space for parkingArea of 10000 cargo trucks. 6) Operated reach trucks,forklifts & hand pallet movers 24X7 CCTV monitoring. CFS owned equipment: 4 Top Lifters, 80 Trailers, 30 Forklifts, 7) 2 Empty Handles, 1 Crane. 8) Inflatable Dock Shelters with Dock Levelers. Distance from JNCH: 11 Kms. 9) 100% Power back-up with multi generators Distance from Belapur station: 7 Kms. 10) Fire- fighting & fire prevention systems Zero toll, congestion & carting charges in the CFS. 11) LED eco-friendly lighting Zero congestion on the approach road. 12) ISO&22000:2005 HACCP Carting stuffing dine in coveredCertified area. 13) Reafer Vans & Support SecondaryForwarders. Distribution Ideal location for Exporters/CHA's/Freight Prompt carting of cargo. Wi-Fi enabled CFS.
Entrance
Covered Carting & Stuffing Area
Total Protection from Rains: Carting Custom & Stuffing area: Completely BondedCovered. Area
15-23, National Highway 4B, Panvel-JNPT Highway Village Padeghar, Panvel-410206, Maharashtra +91 22 66280700-98 +91 22 66280781 jwrcfs@jwllogic.com raaj@jwllogic.com hema@jwllogic.com mgrops@jwllogic.com
Covered Warehousing Facility
www.jwllogic.com
focus of the month
C
onsidering severe air pollution levels, transport experts suggested introduction of Roll on Roll off (RoRo) service for commercial vehicles that ply through Delhi to avoid a lot of diesel emissions. Recently, the Indian Railways tied their hands with the Governments of Delhi and launched a new Roll on Roll off service to carry loaded trucks on goods train in a bid to attract more loadings and reduce carbon emission. With the launch of the Roll on Roll off service to carry loaded trucks on wagons from Haryana’s Gurugram to Muradnagar in Uttar Pradesh, the network plans to extend the service to private vehicles jostling with daily snarls. According to a report, about 20,000 trucks not meant for NCR
RO-RO is an innovative means of establishing a synergistic relationship between the railways and the roadways instead of being competitors. enter the region daily to travel further. Out of the total 127 entry-exit points to the city, nine major points crisscrossing the region account for 75 per cent of the commercial light and heavy duty trucks. Railway ministry officials said eight more routes will be identified soon. The pilot run of RoRo train was carried out successfully on March 2, 2017. As many as 28 trucks were loaded on 20 wagons at Garhi Harsaru Railway Station by the railway officials. The train will run daily and cover a distance of about 80 km to reach Murad Nagar in Uttar Pradesh. At 3.15 am the train started from Garhi Harsaru station for Patel Nagar in Delhi where Suresh Prabhu, the railway minister, flagged it off as it chugged out for Murad Nagar in Uttar Pradesh, a railway official said. The train will cover all stations till Murad Nagar. This initiative is aimed
42 CargoConnect - April 2017
at reducing the carbon print from longdistance vehicles and cut their road travel through Delhi-NCR area. “We examined the vehicles and loaded them on to the train with the help of ramps,” Dharamveer Singh, a wagon officer at Garhi Harsaru station said. At present, the service could be availed free of cost.
What is RoRo? RoRo stands for Roll on Roll off. It is a rolling highway system, also called piggyback transportation. A basic rolling highway network is nothing but a railway track between two points. A train with flat-bed cars runs on the track. Vehicles can then “roll on” to the train at the start, and “roll off” at the destination. The RoRo system has been in operation in India and around the world. In India, it was pioneered by the Konkan Railway Corporation Limited (KRCL) from Kolad in Maharashtra to Surathkal in Karnataka, mainly to serve the industrial region of Verna in Goa. RoRo ships are vessels designed to carry wheeled cargo, such as cars, trucks, semi-trailer trucks, trailers, and railroad cars, that are driven on and off the ship on their own wheels or using a platform vehicle, such as a self-propelled modular transporter. This is in contrast to lift-on/ lift-off (LoLo) vessels, which use a crane to load and unload cargo. Vehicles are rolled up the ramp onto a large vehicle carrying vessel, braced and tied down on a specially designed enclosed deck during the transportation and then rolled off at the destination port. This type of car shipping was developed in Japan specifically for exporting large amount cars from its manufactures to Europe and the USA. Such vessels can fit from 400 to 1000 cars on average and larger ships have enough capacity for transporting up to 6000 cars. The entire loading process and Port-to-Port transportation is handled by port workers and sea line employees, so your vehicle is all taken care of the moment you leave it at the origin terminal and until you pick it up at the destination point. Even though RoRo was originally designed for shipping cars, today this service is also offered to all kinds of motorised vehicles:
Source: hindustantimes
GSA INDIA HERCULES AVIATION (P) LTD. E-MAIL: RATES@HERCULESAVIATION.COM, TEL. NO. +91-11-42690000 WWW.HERCULESAVIATION.COM, MEDIA:
focus of the month of the rakes. Now, on an average 50 trucks are carried per rake and upto three rakes are loaded per day.
What Benefits Do Delhi Await?
motorcycles, ATVs, boats, RVs and even heavy duty machinery (like cranes, tractors, excavators etc).
A Success Story from Konkan Railways RoRo services were started on 26th January, 1999 for carrying trucks on train on the KR section between Kolad (150 km south of Mumbai) and Verna (Goa), a distance of 420
loaded goods trucks are carried piggy back on railway flat wagons. On completion of its 15th year in 2014, it earned the corporation over `50 crore per annum. The popularity of the service can be seen from the fact that over 3.5 lakh goods trucks have been carried by this service so far. The marketing of the innovative service in the initial years was also unique. While print advertisements were given in all language
The ro-ro system has been in operation in India and around the world. In India, it was pioneered by the Konkan Railway Corporation Limited (KRCL) from Kolad in Maharashtra to Surathkal in Karnataka, mainly to serve the industrial region of Verna in Goa. km. (The total KRC segment is 738 kms). The RoRo service was expected to be financially viable, if reliable and regular services were offered. The customers saw this service as having a definite advantage over road driving, saving fuel and wear and tear of trucks. Trucks would be moved on railway flat cars over the distance of 420 km to save much time and expense for the truckers. During the initial years of the train operations by Konkan Railway on its route, the freight traffic was very meager. Since freight traffic is considered the bread and butter of railways, Konkan Railway came up with the innovative RoRo service whereby
44 CargoConnect - April 2017
newspapers, posters were pasted at all dhabas on National Highways that are visited by truckers. Pamphlets in local languages Marathi, Hindi, Punjabi, Gujarati, etc. - used to be distributed by Konkan Railway to the truck drivers at dhabas. Fleet owners were contacted and apprised of the benefits of the service. On the trial day of the service, only five truckers came with their loaded trucks to avail the service. But once the service started, within a few months it gained patronage through word of mouth. Over the years, many changes were brought in the service to make it more efficient by introducing shorter route, more rakes, and ensuring punctual running
“The RoRo is a boon for Delhi as it would have a direct impact on its air ambient quality and the capital would breathe clean air,” Railway Minister Suresh Prabhu said after launching the service. According to the Railways, there are about 20,000 trucks which are not meant for the NCR, but enter the region to travel further. There are eight entry or exit routes in the NCR which will be utilised for Roll on Roll off service to take trucks off the road. It is a win-win situation for truckers as well as for railways as goods will be transported in safe and faster way, saving cost on diesel and man-days besides reducing the pollution level. Through this scheme, Indian Railways aims at decongesting the traffic situation of Delhi and the NCR region. Furthermore, reducing the pollution levels of the city by simply transporting commercial vehicles via rail. This way, these trucks won’t have to cross the national capital and NCR while going towards its destination. Due to the RoRo, air pollution across the NCR will substantially reduce. The movement of trucks which was restricted from 7 am to 11 pm will be allowed once again. Entry points will also witness reduced queues giving drivers adequate amount of time to rest. Truck drivers will also save fuel along with toll taxes as well as Environment Compensation Charge as the railway freight charge will be more economical and road accidents will also reduce.
Let’s Implement it Pan India RoRo is an innovative means of establishing a synergistic relationship between the railways and the roadways instead of being competitors. The service has helped the railways to get back the piecemeal traffic which had got diverted to the road sector. The service benefits the truck owners as well as the railways, while saving precious diesel for the country. It saves wear and tear of tyres, reduces maintenance cost of trucks, enables faster turn-round of trucks, faster delivery of goods, gives higher profits, less pollution, and better road safety. More than these, the RoRo service is eco-friendly and cheaper than the road transport. But, the question is, if it is good, why is it not getting implemented Pan India?
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feature
Security and Customs Backbone of air cargo operations
International trade, an essential element for the economic development of any country, has been vulnerable to terrorist exploitation in recent years. The Authorised Economic Operator, now considered an important element of international trade security compliance, is an outcome of the Customs Trade Partnership against Terrorism (CTPAT) scheme which was introduced by USA Customs Border Protection (CBP) in the backdrop of the devastating terrorist attack on the World Trade Centre in 2001. Deepashree Banerjee with respective opinions from the experts, talks about the issues of security and customs in air cargo and the measures adopted regarding the same.
46 CargoConnect - April 2017
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Perfect Express Movers (P) Ltd
Air Freight Forwarders & Consolidaters HEAD OFFICE 2 E & U, DCM Building, 16, Bharakhamba Road, Connaught Place, New Delhi-110001 T: + 91.11.47343502-16 F: +91.11.47343501 E: info@perfectexpress.in W: www.perfectexpress.in
OUR BRANCHES: MUMBAI, CHENNAI, BENGALURU, HYDERABAD, KOLKATA, AHMEDABAD
feature
A
s the name suggests, the CTPAT scheme aims to recognise all those supply chain partners who are considered to be safe enterprises for the international EXIM trade and includes importers, exporters, highway carriers, rail and sea carriers, custom brokers, marine port authority or terminal operators, freight consolidations and other stakeholders in the international EXIM trade supply chain. The International Air Transport Association (IATA), the leading global airline trade group, said the United Nations Conference on Trade and Development (UNCTAD) had integrated IATA’s cargo messaging standards into its automated system, which is used by 90 countries to support their customs procedures. Encouraged by the USA CTPAT scheme, the World Customs Organisation(WCO), an organisation of 178 customs administrations,
adopted the ‘SAFE Framework of Standards’ in the year 2005. The aim was to secure and facilitate global trade which included the concept of Authorised Economic Operator, whereby a party engaged in the international movement of goods is approved by customs as compliant with supply chain security standards, and is given benefits of simplified customs procedures and reduced customs intervention in the trade route.
Challenges and remedies In India, the Central Board of Excise and Customs (CBEC) launched the AEO programme in August 2011, consistent with the ‘SAFE Framework’ as developed by WCO. The AEO programme in India is headed by the Directorate General of Inspection (DGICCE) and managed by the Additional Director General, DGICCE. The programme is currently implemented in our country on a voluntary basis i.e those who are interested in getting benefits of the programme may apply for authorisation, which is being granted to
an entry after detailed pre-certification and validation by the AEO programme team. Although the AEO programme is capable of providing safety and security to the international supply chain with various other benefits, the acceptance of this programme worldwide is slow and it has a long way to go in achieving its whole objective. Packing and securing cargo is still perceived to be an additional cost in India which leads to substandard packing and loss and pilferage of goods. According to Ram Menen, retired Aviation and Air Cargo Executive, cargo security issues have historically been, and still is, a major concern for the industry. He says, “It doesn’t, however, affect the growth of the business as the growth is demand driven. The pilferage, theft and security issues add costs within the supply chain. Over the years, in general, security has evolved and the overall pilferages and thefts have come down with more use of surveillance equipment at all touch points. Better tracking, secure,
CARGO SECURITY
Fri Sat
Sun Mon
52 %
Average of three cargo thefts per day in Europe in 2014 4
C-TPAT secured cargo up to 9 times less likely to undergo a security exam 5
MOST TARGETED CARGO
SUNDAY IS THE MOST ‘AT RISK’ DAY OF THE WEEK 2
Of thefts occur between Friday evening and Monday morning
€205,624 Average value per theft in Europe in 2014 4
2
LOSSES TO CARGO THEFT ARE ESTIMATED AT MORE THAN €26BN A YEAR 3
1 FreightWatch International (U.S.A) Inc. 2013
TPAT
3
CARGO IS AT RISK HOWEVER IT SHIPS
HIGH RISK 1 • Mexico • Brazil • South Africa • United States • Russia
A REAL MARKET CONCERN…
€26 BILLION
2 www.highbeam.com from International Cargo Security Council and TAPA (Transported Asset Protection Association)
www.essentracomponents.co.uk
48 CargoConnect - April 2017
FOOD & DRINK
HIGH VALUE TARGETS
CARGO THEFT VICTIMS • • • • • • •
Manufacturers Insurance companies Employees (drivers etc) Transport companies Retailers Consumers Governments
3 www.fbi.gov 4 Transported Asset Protection Association
CIGARETTES
COMPUTER/ ELECTRONICS
PHARMACEUTICALS
CONSUMERS PAY
20% 5 www.cpb.gov
More for products to make up for losses to cargo theft 3
We keep things fresh...
Infrastructure & Advantages Storage of 7000 pallets, 15 identical chambers of 432 pallets 1) Storage of 7000 pallet,15 identical chambers of 432each. Temperature range of +25 degrees C to -25 degrees C Pallets each 24X7 operational range of +25°c to -25°c 2) Temperature VAS facility of processing, repacking, labeling & sorting. 3) 24x7 Operational Hours Customs bonded area. 4) VAS Facility of Processing, Repacking, Labeling & Operational reach trucks, forklifts & hand pallet movers. Sorting IT infrastructure with WMS, FIFO, control & Barcoding systems. 5) Customs Inflatable dockBonded shelters Area with dock levelers. 6) Operated reach & hand pallet movers 100% power back up trucks,forklifts with multi generators. Fire fighting & fire prevention systems. 7) LEDInflatable eco-friendly lighting. 8) Dock Shelters with Dock Levelers. ISO 22000:2005 & HACCP certified. 9) 100% Power back-up with multi generators Refer Vans to support distribution. 10) Fire- fighting & fire prevention systems 11) LED eco-friendly lighting 12) ISO 22000:2005 HACCP Certified 13) Reafer Vans & Support Secondary Distribution
Services
Temperature Control Handling Area
Custom Bonded Area
15-23, National Highway 4B, Panvel-JNPT Highway Village Padeghar, Panvel-410206, Maharashtra +91 22 66280700-98 +91 22 66280781 raaj@jwllogic.com vaman@jwllogic.com cs@jwllogic.com
Freezer\Chiller Chamber
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feature Organised crime still continues to plague the industry. Airports have now become more secure and tend to be mostly a safer and secure environment. Petty thefts do still occur, however, the use of surveillance cameras in all areas including the ramp area, ensuring that there are no blind spots, helps in reducing such activities ensuring that perpetrators are very quickly apprehended.” Ram Menen, Retired Aviation and Air Cargo Executive.
tamperproof equipment have all gone to help secure the security and safety of the cargo. TAPA (Transport Asset Protection Association) has documented and defined best practices for secure transportation of goods and is a good certification to have to ensure secure transportation.” Menen agrees that shippers using air freights for shipment of their goods and service are still facing modern day security challenges. “Organised crime still continues to plague the industry. Airports have now become more secure and tend to be mostly a safer and secure environment. Petty thefts do still occur, however, the use of surveillance cameras in all areas including the ramp area, ensuring that there are no blind spots, helps in reducing such activities ensuring that perpetrators are very quickly apprehended. There are areas where the pilferage was actually happening inside the aircraft holds (especially at some of the African airports) whilst loading and offloading. A lot of airlines today use onboard surveillance cameras inside the cargo that holds to overcome this type of challenge,” says Menen. He adds, “Security is paramount, not only to the safety but the secure transportation of goods on all modes. Securing of the goods has to start right from shipper’s premises and then on, being able to track and record every individual who has had access and handled the package throughout the entire transportation chain till it reaches the end consignee or consumer. IATA through their Secure Freight initiative has defined an auditable process which is a good practice to follow.” The Union Customs Code was enacted in order to modernise and simplify trade into and within the European Union. The UCC implemented by EU is indeed a very good move to streamline the movement of goods, Menen feels. “It smoothes out the outdated bureaucratic processes creating
50 CargoConnect - April 2017
more harmonious codes, thus speeding up and reducing overall costs within the supply chain,” he says.
Technological Assistance Menen agrees that having good facilities with all digitised border control auditable processes is definitely an asset and better facilitates the movement of goods. “The more you take the human intervention out of the process, the faster and more efficient the overall processes become and the immediate tangible benefit, apart from more secure environment, is achieving better cost efficiency in the overall
Updating and improving screening techniques has become a necessity to face the challenges of today, which include the rising number of passengers and trade volume.
supply chain. Transportation and logistics are the wheels of commerce,” says he. According to the expert, the traditional relationship between the GDP and growth in air cargo is now blurred. “In the past, the air cargo growth was roughly double the GDP growth. However, since the economic challenges of 2008 and evolution of E-commerce, this relationship seems to have changed. The growth in traditional cargo is slowing down whilst a whole online driven trade is growing in double digits. The industry is still trying to make sense of the new reality.” The integration of the IATA system, known as “Cargo-XML,” standardises the electronic
communications between airlines and customs authorities using the program, IATA said. The system is designed to simplify communications by eliminating message duplication. It is part of a broader plan to unify messaging protocols between the air cargo supply chain and global customs authorities in an effort to improve the flow of air-shipped goods. Bharat Thakkar, Co founder of Zeus Air Services Pvt Ltd and former President and Permanent Adviser to Board- ACCAI opines, “With Limited infrastructure and resources available, it is not feasible for our members to certify security and compliance of contents of shipments. It is not possible for air cargo agents to ensure watertight security throughout the chain of movement of cargo till it reaches the airport. This is only feasible in restricted, protected and secured environment of an airport cargo terminal. This is the final stop on ground for an export business before it flies out and at this point one must ensure a comprehensive and conclusive security closure.” He continues, “As intermediate service providers we support enhancement in air cargo and aviation security. However, the need is for the measures to be efficient, realistic and total so that, security is fully and effectively achieved and such an objective can only be attained at the airport cargo terminal. One environment at the airport is simply not conducive for an agent to ensure complete security measures right across the chain as indicated earlier.” Manpreet Singh Dahri, Manager Cargo Sales, Namaste India Aviation also agrees that the industry has cargo theft and other security issue which affects the overall growth of the industry. “There is a significant problem with the theft of cargo worldwide. This fact is well known. There are many reasons behind cargo theft, but it can be described basically with three main characteristics - value, cargo carrying ability, and valuable documents,”
“Continually Innovative”
feature As intermediate service providers we support enhancement in air cargo and aviation security. However, the need is for the measures to be efficient, realistic and total so that, security is fully and effectively achieved and such an objective can only be attained at the airport cargo terminal. One environment at the airport is simply not conducive for an agent to ensure complete security measures right across the chain as indicated earlier.” Bharat Thakkar, Co founder of Zeus Air Services Pvt Ltd
he says. There are some actions which need to be taken in businesses to prevent cargo thefts: • Thoroughly screen prospective employees. Some cargo security experts maintain that a high percentage of cargo thefts involve inside information or complicity. • Carefully select transportation partners and intermediaries. Remember that these companies have care, custody and control of goods once they leave your premises until they reach their destination. • Establish a security culture within company. Provide security training for employees, and educate concerned team with respect to awareness and prevention. • Factor in security when determining shipment routing. Cargo thieves often “case” known shipping points (plants, warehouses and distribution centers) and follow trucks as they depart, waiting for the drivers to stop so that they can pounce on the loads. Drivers should not be allowed to stop in the “red zone”. • Incorporate counter surveillance into the duties of security guards, and have guards patrol away from perimeters. • Take advantage of technology. Vehicle and shipment tracking, vehicle immobilization
52 CargoConnect - April 2017
and advanced, high-technology security seals are now available at lower cost. • Conduct periodic security audits. Operations and personnel change, and criminals are always harvesting fresh ideas and modifying previous techniques. Regarding the modern day security challenges, Dahri shares a closer look and its impact that shows that shipper faces many challenges in air cargo industry – especially financial. “The economic downturn has been particularly difficult for the cargo side of the airline business. Speed is air cargo’s biggest selling point that attracts shipper. But it comes with a price that is many times more expensive than shipping by sea. In addition, cargo security during freight transport operations, particularly in the trucking industry has become more than a nagging problem. Work force development poses both short-term and long-term challenges to the freight transportation industry. Also, long-term climate change is a real and serious problem, one that may significantly impact the viability of freight transportation operations,” he adds. Dahri goes on, “There any significant efforts or initiatives offered by the airlines or airports concerned team to ensure an optimum security for air cargo business as transportation
industry faces an array of challenges. As previously discussed, technological advances are being made that offer the potential to help address some of the aforementioned concerns. Much of this technology innovation focuses on devices that can collect and communicate valuable information in real-time. These days, operators are applying advanced technology enthusiastically.” He also cites examples in this regard, for instance, biometric identification tools, such as fingerprint and iris recognition, are being incorporated into smart identification cards and integrated with on-line access to manifest, vehicle, and driver databases. In addition, temperature, pressure and toxic sensors are improving the safety of hazard shipments and other fragile cargo. The adoption of Cargo-XML will make it easier for airlines, freight forwarders, and shippers to comply with specific technical guidelines established by the various customs bodies and regulators, according to IATA. It also facilitates custom risk assessments for air cargo shipments and improves compliance with security regulations. “Considering the complexity of trade flows and increasing demands on advance risk assessments and operational efficiency, electronic data interchange is an integral component of customs modernisation programs,” said Shamika N. Sirimanne, director of UNCTAD’s division on technology and logistics, in the same statement.
Policies and Programmes Established in 1964 as a permanent intergovernmental body, UNCTAD is the principal organ of the U.N. General Assembly that deals with trade, investment, and development issues. Much of IATA’s cargo-related focus has come in the area of improving digital connections among multiple stakeholders to
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feature There is a significant problem with the theft of cargo worldwide. This fact is well known. There are many reasons behind cargo theft, but it can be described basically with three main characteristics - value, cargo carrying ability, and valuable documents.” Manpreet Singh Dahri, Manager Cargo Sales, Namaste India Aviation Pvt Ltd
support the movement of high-value, timesensitive air shipments. Only one per cent of global trade tonnage moves by air. However, air transports 35 per cent of world trade’s value, which is equivalent to US$5.6 trillion a year, according to IATA. Many high-value international goods move by air because the mode’s swift transit times are necessary to get expensive products to market as fast as possible. But the lack of connectivity among supply chain stakeholders can slow down the end-delivery cycle, offsetting air’s natural speed advantages. D. R. Juyal, Director, Air Cargo Forum India identifies that cargo theft and other security issues are a major concern of the industry which affects the overall growth of the industry. “Details of people who are caught by any agency should be shared with the concerned Security Head so that the culprits do not get entry through any other agencies in the cargo terminal. In addition, CISF personnel should frisk each and every person and the vehicles moving out from the air side gates of the airport,” he says. According to Juyal, following are the cargo security challenges at airports: • Too many agencies involved such as customs, civil aviation, airlines, custodian, police and security agencies. • Threat of terrorist attacks or Hijacking • Suicide Bombing. “Basic awareness training program is being conducted by some of the airlines and airports and Cargo Terminal Operators”, Juyal adds. However, Juyal thinks, to ensure an optimum security for air cargo, training programme including Risk Management, Entry Points, Warehouses, secure the perimeter of the airport, Accredited Client Program (ACP) and Authorised Economic Operator (AEO) programmes must be integrated into the overall Air Cargo Security challenges faced by shippers using air freights
54 CargoConnect - April 2017
for shipment. Recently, Dubai’s top customs official had said that greater co-operation is needed between local, regional and international authorities to facilitate trade and sustain high levels of security. “With the UAE’s positioning as a worldclass transport and integrated logistics hub, it has become more important than ever to deploy effective screening and detection technologies at all borders to protect our societies from the perils of illegitimate trade,” said Ahmed Mahboob Musabih, Director General of Dubai Customs.
Only one per cent of global trade tonnage moves by air. However, air transports 35 per cent of world trade’s value, which is equivalent to US$5.6 trillion a year, according to IATA.
“Customs administrations around the world will seek to adopt the latest advancements in inspection in order to sustain security and protect societies from the perils of illegitimate trade without compromising the quality of service they provide to their clients.” Musabih delivered the keynote address at the opening of the Cargo and Personnel Screening Conference being held in Dubai. Musabih reported that Dubai Customs provides the emirate’s various international points of entry with state-of-the-art technology in order to help maintain security and prevent illegal cargo flows. “The Risk Engine evaluates shipments
based on information funnelled into it from different channels and decides the level of risk. “Accordingly, 96 per cent of declarations didn’t need any human intervention, and this was applauded by World Customs Organisation which advised other customs administrations around the world to adopt it,” Musabih asserted. Ramesh Mamidala, Celebi Delhi Cargo Terminal Management India Pvt Ltd too agrees that currently air cargo industry faces various security challenges, some of which include thefts and pilferages within warehouses, hijack of cargo trucks, piracy of air shipments, malicious intent of people involved etc. All these risks are a matter of concern for all the stakeholders and the entire industry need to ensure a coordinated effort to mitigate the risks, he opines. Mamidala also points out that various steps can be taken to prevent this such as: • Installation of advanced security gadgets across the warehouses such as CCTV, ETD, advanced X-ray machines etc • Credentialing of participants in the supply chain • Ensuring the security of cargo while intransit via the use of locks and tamperproof seals • Inspecting cargo on entry • Proper and Periodic Background Checks of Manpower Involved “As a cargo terminal operator, we go through a very stringent check and balance process to curb the involved risks which includes deployment of trained security manpower at each point of operations, strong AEP screening process, installation of more than 350 CCTV cameras covering each and every corner of the warehouse on 24x7 basis, Dual View X-ray machines, Explosive Trace Detectors and deployment of Sniffer Dogs. In fact, we are a RA3 certified terminal which ensures
feature Details of people who are caught by any agency should be shared with the concerned Security Head so that the culprits do not get entry through any other agencies in the cargo terminal. In addition, CISF personnels should frisk each and every person and the vehicles moving out from the air side gates of the airport.” D. R. Juyal, Director, Air Cargo Forum India
that our processes are air tight at each step of handling,” Mamidala says. “Most importantly, we have built an organisation culture which instills a sense of responsibility amongst our staffs through various training programs and sensitisation sessions. As a result of all our measures, we have experienced NIL pilferage cases during the past 4-5 years of operations,” he mentions. Mamidala also specifies that in addition to the above, the role of regulatory bodies is
56 CargoConnect - April 2017
extremely important. In line with the same, IATA is taking various right steps in these directions such as introduction of IATA Secure Freight, ACC3 Validation, Advanced Cargo Information, e-CSD which will only strengthen the supply chain network. “We believe that with increasing awareness amongst the stakeholders about the sensitivity of the goods being transported through air along with collaborated efforts, we would be able to ensure a flawless supply chain security
environment,” he assures. The air cargo industry is definitely closely tied to World GDP. In fact, the aviation sector contributes to almost 3.5 per cent of World GDP. While airfreight may be a tiny proportion of all freight by tonnage (2–3 per cent), nonetheless it can represent a significant amount of countries total imports and exports by value, typically between 35–40 per cent in many advanced economies. “The highest value goods, most essential shipments and most sensitive commercial documents are flown across the world for safety, security and essential speed. In addition, it has significant contribution to the economy in terms of creation of millions of jobs which includes airport staffs, other on-airport staffs, airline staffs, ground handling staffs, civil aerospace staffs, air navigation service providers etc,” Mamidala concludes. From July 1, 2017, United States (US) legislation requires all air cargo being transported to the USA to either be examined at piece-level or originate from a Known Consignor. The US Transportation Security Administration (TSA) has requested each airline to submit a proposal outlining an implementation plan to meet the piece-level examination requirement. On November 1, 2014 the government approved regulations to ensure compliance with the Australian and US Government. Administered by the Office of Transport Security (OTS), this regulation ensures compliance with the Australian and the US Government agreement to phase-in piece-level examination of 100 per cent of US-bound air cargo. In summary, cargo must be: • Originating from a Known Consignor; • Examined at a piece level by a Regulated Air Cargo Agent (RACA) • Examined at a piece level by the CTO upon acceptance of freight and before loading onto an aircraft.
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feature Most importantly, we have built an organisation culture which instills a sense of responsibility amongst our staffs through various training programs and sensitisation sessions. As a result of all our measures, we have experienced NIL pilferage cases during past 4-5 years of operations.” Ramesh Mamidala, CEO, Celebi Delhi Cargo Terminal Management India Pvt Ltd
Known Consignor-Exporters that use international best-practice security measures to prevent unlawful acts against aviation can apply to join the Known Consignor scheme. A Known Consignor is responsible for securing air cargo that originates from their business until the air cargo is provided to another regulated business. RACA - Businesses that examine and security clear international air cargo must be approved by the OTS as RACAs. Only those RACAs with an Enhanced Air Cargo Examination (EACE) notice can examine and clear international air cargo at “piece-level”. Piece-level means that each individual box, carton or other item in a shipment is examined by approved technology before it is loaded onto an aircraft. AACA - The other important stakeholders are approved transport operators. The Accredited Air Cargo Agent (AACA) is a scheme for businesses that handle, or make arrangements for the transport of air cargo. The UK and Germany, Bangladesh’s two major export destinations in the EU, are yet to lift the ban on direct cargo flights from Bangladesh
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even though the government claims safety measures at Hazrat Shahjalal International Airport have improved. Meanwhile, the ban has impacted shippers, exporters and freight forwarders as mandatory rescanning in third country has increased transportation costs.
Transport by air is supposed to be the fastest method of shipping, but antique ways of operating seems to be slowing the industry’s potential at times of most need. Freight forwarders may have the process down to a science (some would say an art), but the International Air Cargo Association’s (IATA) Shippers’ advisory committee’s report shows the process is becoming a nuisance to shippers who see digitisation as a necessary transformation.
Recent Developments
Dive brief:
Experts say that if President Donald Trump goes through with his protectionist measures, India would cease being a viable location for these manufacturers because they will face high customs duties for exports to the U.S. Additionally, India will not be the first choice for those who source goods from the country for the U.S. markets, since these will be more expensive. This draconian situation would result in a big blow to the Prime Minister Narendra Modi’s Make in India programme, where loss of jobs as well as repatriation of funds would clobber India’s economy (at least in the short run). The Federation of Freight Forwarders’ Associations in India (FFFAI) Chairman Samir J. Shah said that while it was true Donald Trump had certain commitments to fulfill regarding protection of ‘national interests,’ and trade and commerce would be the prime focus in this direction, “We don’t see any major shift from the ongoing and future bilateral trade relationship between India and the US. India has never been treated by the US as a contender that can pose a threat of influx of goods and human resources to America,” Shah says. He further adds, “On the other hand, in the US there is always a huge demand for quality goods and manpower, especially from India.”
• The air cargo industry must work together to adopt new technology, build transparency and expedite a complex documentation process, revealed a new position paper by the IAT Shippers’ Advisory Committee, American Shipper reports. • All stakeholders must work together to diminish the 20-step, 21-document process needed to process cargo by air, per the paper. The committee is formed by seven representatives from various industries, which face diverse challenges when shipping by air. • The ultimate goal is to employ an open platform system allowing for a shared environment that creates seamless integration and transparency to reduce or eliminate wasteful information re-entry. In fact, the CEO of IAG Cargo recently described the industry’s inefficiencies as criminal, lending his voice in support of the IATA’s drive to digitize processes. The industry group has long been working on this initiative, which is hampered by differences in how international customs categorizes goods and other bureaucratic challenges. The group scored a big win in August, however, when the US Customs and Border Protection agreed to adopt the association’s Cargo-XML messaging standard, pushing shippers and freight forwarders trading out of the US to do the same.
feature
Bunch of Delhi Women conquering another male bastion We all are familiar with men coming over to deliver our parcels, but how about having women coming over to deliver your orders on two-wheelers? Even Cargo, India’s first women-only delivery personnel service, a Delhi-based social enterprise, is doing just that. But will the social enterprise make the desired impact? Deepashree Banerjee finds out how it impacts the work and lives of the fairer sex in the delivery business.
D
riven by a team of women delivery personnel, Even Cargo works towards attaining gender parity by empowering women and engaging them in professions that have traditionally been inaccessible to them. An initiative by Yogesh Kumar, Founder, Even Cargo, who had earlier started a venture called Delhi OYE or Delhi Open Your Eyes aimed at women empowerment and preventing incidents of sexual harassment in public spaces. In 2012, also the same year when the gory and heinous Nirbhaya gang rape case took place, Kumar, a sprightly engineer quit his job with a German engineering firm and enrolled in a graduate program in social entrepreneurship at the Tata Institute of Social Sciences, in Mumbai. “Inequality and disparity were responsible behind my decision to start Delhi OYE first, and then Even Cargo. Many of my experiences, whether it was seeing a girl struggle to find a safe spot on a crowded bus or them trying to stay away from unwanted touches and gazes – made me start this initiative. It’s a shame that I saw women struggling on a daily basis and I am doing my bit,” says 28-year-old Yogesh.
Genesis of the social enterprise: Even Cargo encountered hiccups in its initial phase, like any other startup would. When the young team started Delhi OYE as a pilot project in March 2014, their aim was to make public spaces safer for women. “We developed an online platform to register the cases which generally go unnoticed and unregistered. But then our aim wasn’t just to get them registered
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Many of my experiences , whether it was seeing a girl struggle to find a safe spot on a crowded bus or them trying to stay away from unwanted touches and gazes – made me start this initiative. It’s a shame that I saw women struggling on a daily basis and I am doing my bit.
Yogesh Kumar, Founder, Even Cargo. on our platform, we wanted Police to become an important stakeholder. We engaged with them for over a year, we wanted them to come onboard and take cognizance of these offences. But for many reasons it didn’t work out. Observing the long time that government process takes we decided to start engaging youth and children in our mission to build gender awareness, “shares Yogesh. “For two years we worked with students from different schools, colleges and transport personnel to build awareness around gender and violence against women,” adds he.
The rise in logistics companies for easing delivery of packages, due to the sudden spurt in e-commerce industry, seemed promising to him. The team was able to reach out to over 1200 people in a span of almost three years with their workshops and activities. “Soon, we observed that most of these workshops are conducted in places such as GK, Panchsheel, Safdarjung Road. People from these areas have their own need, nobody is denying that. But, we saw not many people going to a Badarpur or a Badli to conduct these activities and workshops,” says he. “So we decided to do that. While doing so, we realised that people who are finding it hard to make their ends meet, it’s very unfair on our part to expect them to understand gender as a concept. It was a deliberate decision to not train the women in skills like cooking or teaching (those which are usually associated with the fairer sex). “It’s not that workshops are not useful but we wanted to make a statement through our action so we decided to start a ‘for women by women’ cab service. But it didn’t work out due to various factors, one being, the risk of owning the vehicle was seen as a big problem by these women. The whole purpose of starting this venture was to empower women to reclaim their share of public space. So then we started with Even Cargo logistics service,” Kumar tells us. Within the Delhi NCT, currently, the team is handling about 20 parcels per day, which will grow up to 200 by the end of this month. They are soon planning to expand their operations in other cities as well. The focus, says Yogesh, is to overcome
feature the barriers of unemployment through skill development of women to increase their participation in the labour market. The average age of the women employed with Even Cargo is 21 and half years, and all of them belong to families whose average income is less than Rs one lakh. However, all of them have completed their high school and primarily deliver apparel and accessories. The team works mainly in the space of Last Mile Delivery and has been delivering women products and accessories; soon, they will also be delivering medicines as well. Moreover, the employees get assistance in pursuing their studies along with classes on English and computers. For any girl to be employed as a delivery girl with Even Cargo, she has to go through four modules of training – first, a training in riding two wheelers by Honda, then a training in soft skills and self-defense, and finally a logistics-specific training. While the scooties, which are used by the women to commute, are currently owned by the organisation, Yogesh says that he is exploring opportunities and approaching government bodies and even corporate houses to help him procure two-wheelers for his employees. “We are also considering getting these scooties financed from banks,” he adds. The company had until now trained over 100 girls to ride two-wheelers, but it was not easy for Yogesh to convince them and their parents to take up the job. But hopefully, the women feel much more confident now. “The best thing was to witness the growth of these girls, increased confidence and the conviction that they are no less than anyone else. It has always been heartening to hear anecdotes from them,” Kumar says.
Delivery girls ride their way to freedom Even Cargo started with a vision to create a gender harmonious world, where everyone will have an equal opportunity to earn their livelihood irrespective of their gender. A 20 year old resident of Sangam Vihar felt angry and agitated when her parents were repeatedly turning down her frequent requests to let her visit Connaught Place with friends. The distance between her home in south Delhi and CP is barely 20 km but her parents always said no as they were worried about her safety.
She is one of many women from the underprivileged sections who are now working as delivery girls -- considered a male bastion -- in cities such as Delhi, Mumbai and Bangalore. They offer different reasons for taking up the profession but they all have a common belief -- that being able to ride a scooty firmly put them on the road to freedom and economic independence. Most of them have studied up to high school and earn about `10,000 a month. The office presently has ten employees, all women except the founder Yogesh Kumar, who says his social enterprise attracts many young women interns from prestigious institutes, including the popular IIMs. “People expect women to be in certain kinds of jobs. We want to change that. Gender is in fact at the core of our operations. We want to ensure women have equal access to public spaces,” says Kumar, the electrical engineer-turned-social entrepreneur. Kumar also revealed that out of the 100 women they trained, only six completed training and joined as permanent employees. Others dropped out mostly because of lack
of support from their families. His start-up, Kumar says, only works with companies that deal in women’s apparel and accessories. “The idea is to build confidence among the women and reassure their families about the safety of their daughters,” he concludes.
A challenging yet laudable step ahead: The journey so far has been challenging, Kumar, the man behind this all women workforce, admits, especially when no one from the team had any background in this logistics. “There are generous people from industry helping us build them understanding to increase women participation in this logistics space,” reveals Kumar. Stereotypes are being challenged though at a small level, but the vivacious team has been able to create ripples and they are hopeful that these ripples some decades down the line will create change. Hopefully, this noble idea, makes it normal for a ‘woman’ to take up a ‘man’s job.’ and reclaim the public spaces for their safety.
april 2017 - CargoConnect 61
Interview India and Latvia have been historically linked by the ancient route called ‘The Amber Way’. Latvian Railway, the stateowned railway company in Latvia plans to translate these connections by expanding its freight territories through India. Edvins Berzins, CEO, Latvian Railway in an exclusive interview with Nicin Varghese talks about their expectations regarding Indian market and future plans.
Since Latvian Railways has reached India, do you think India can turn as a major market for the other prominent sectors such as air and maritime of Latvian group? We work to develop the transit offer of Latvia as a whole, including offering it to the potential partners of India. Therefore, we are involved in the development of the North-South Transport Corridor. We have the possibility to ensure vast range of logistics services, adding value to the product and therefore making our service more attractive. One of Latvia’s biggest advantages is three ice-free ports. This means that we can offer logistic services railway-port throughout all seasons, including winter, when in other countries ports freeze over. In addition, it has to be taken into account that by offering our services, we can deliver freights to the port of Hamburg in Germany faster than it would be by using maritime transport.
Do you foresee Latvian Railway as a gateway for Indian goods to Europe and CIS? And, how was India’s cooperation in expanding a freight route between Asia and Europe?
Forging New Relationships 62 CargoConnect - april April2017 2017
India’s role in the world’s economy is growing, and India needs new markets for its goods. Therefore, we are working on possibilities to develop new routes, because freight flow from India to Europe leads through Iran, Azerbaijan, Russia, Georgia and Belarus. We are ready to supplement this logistics chain and ensure further movement of freights to the north of Europe (Scandinavia), as well as to deliver the freights to ports of Europe, swiftly and efficiently.
In today’s globalized world, how do you plan to develop connections with a mutual benefit for both the countries? The railway to Riga opens great opportunities for entrepreneurs from India to strengthen their positions in the Western Europe, because the port of Riga is like a window to other European countries, especially
the ones in Northern Europe. Moreover, Latvian Railway (Latvijas dzelzcels, LDz) offers safe and efficient services, delivering the freight at the destination on time. Time in business means a lot – it creates both profit and savings to the budget. For LDz it means new clients, new opportunities to develop business and show Asian partners our reliability and quality. Cooperation with India will provide a contribution to the ports of Latvia, through which the products will be transferred further to other European countries, as well. Latvia has to look positively on the opportunity to attract new investors and Asian market is a relatively new cooperation direction also in this area.
What could be the major opportunities for India to increase its economic presence in Latvia? LDz offers favourable logistic tariffs and fast transportation, at the same time also taking care of customs formalities. By delivering freights to the ports of Latvia, wide possibilities open up for Indian entrepreneurs to also enter other European markets. Whereas the development of joint logistic solutions in this region, could create wider opportunities to increase the added value for the goods, by sorting, packing, providing further distribution, etc. from the ports of Latvia.
Latvian Railways freight subsidiary, LDz Logistika has announced plans for the trial operation of its container service connecting Riga with Mumbai. Please share your expectations regarding this. We organised a pilot freight train from the city Yiwu in China – it was a successful project, both because the route was officially marked in the international transport map, and because it raised a large interest from the entrepreneurs of China. Taking into account the gained experience, we are certain that the pilot freight train from India has the potential to show even better results and our cooperation with clients from India will be very successful and will contribute to the economies of both countries. Asian market is very large and India is a country with a strong and growing economic influence. Therefore, we are very interested in this cooperation.
As Latvian Railways also have rail links in few adjacent countries like Russia, Lithuania, Belarus and Estonia, how have you been strategizing your services in other countries connecting various borders? These countries are our main cooperation partners and jointly we can offer our clients advantageous connections and ensure an
international transport corridor to the biggest ports of the Baltic Sea, and further to Europe. I think there are benefits for Asian countries as well, including India, because we can offer full logistic service cycle throughout the corridor. Regarding the cooperation with Estonia and Lithuania, I want to mention the new ‘Rail Baltic’ project, which will link all three Baltic countries with Western Europe. The implementation of this project is possible only due to good long-term relationships among the three countries. The logistics centre, which will be located near the capital of Latvia that is intended within the project, will provide railway transportation from east and further to Europe, regardless the differences in rail gauge of both regions. We have a long relationship with partners in Russia and Belarus. There are LDz representation offices in both countries, which have a significant role in the development of business relationships. As it is known, both Belarus and Russia have taken part in providing freight transportation from Asian countries. Therefore, the partnership of LDz with railways and logistic companies of these countries is very important.
In November last year, Latvian Railways (LDz) and the Latvian Ports Transport and Logistics Council had unveiled a plan to expand the electrified network from 257 km to 839 km and replace all existing dc electrification with ac equipment. How far do you think the upgraded facility has been successful? This is one of the most important projects for LDz, which the Latvian government has approved at the beginning of the year. We expect to electrify all major railway lines in Latvia by 2030. The first stage of the project will be the railway network electrification from Rezekne and Daugavpils to Riga, which is significant in relation to attraction of Asian cargoes. The project will be beneficial for both economy, and environment. Electric locomotives are more environmental friendly, more powerful and produce less noise. They are also cheaper to operate. The math is simple – the costs of electro traction in comparison to diesel locomotive are one euro per ton lower. Maximum train length in Latvian railway infrastructure are 57 wagons in one stock, each carries an average freight of 60 tons – the economy per one stock is already approximately 3420 euros. Moreover, this one euro per ton plays an important part in the battle for the choice of freight owner, and which routes to choose for transporting the freight.
In the past year, the Indian Government has approved private business development program that should promote development of transport logistics companies in cargo transportation to Europe. Are you ready to expand this logistics chain and ensure further movement of cargos to northern Europe? Last year, we started reaching out for the Asian market. In November, we brought to Riga a pilot train from the city Yiwu in China, which officially marked our transit corridor in Asia freight transportation map. The railway of Russia, with which we cooperated to ensure this route, has already included it in their official train formation plan for this year. In cooperation with ports, we offer logistic services from Eastern Europe and Asia to the ports of Latvia and further to other European countries in the west and north. In 2017, we are working on formation and testing of several new routes, including through the Kazakhstan and China border crossings Dostyk and Altynkol. At the same time, we already provide separate wagon group transportation from China to Latvia, and this year we also plan to bring the first freight train from India, which means new and wide cooperation opportunities in the future covering a wider region.
What influence will have the “Rail Baltica” project, that will link Baltic countries and Western Europe in one railway line with a 1435mm railway North – South connection? Both railway widths – 1520mm and 1435mm – will form a strong synergy in the future. It is planned to open a large logistic centre near Riga, where these two railways will cross, which will supplement each other excellently and will offer clients the best goods transportation route through Latvia from Europe to Russia, Belarus, China and India. Moreover, we have the opportunity, by using both railways, not only to transport the freights trough the country in transit, but also to ensure wide logistic service, adding value to the goods and making our logistic services more valuable. It is obvious that coal and oil products will not be transported using Rail Baltica rail roads. Their target is the port. But other kinds of products will definitely be transported. It is known, that it is cheaper to transport freights long distance using railways. Therefore, I evidently see perspectives for this project, jointly with LDz creating a strong offer set to the potential investors and clients.
april 2017 - CargoConnect 63
Interview
Reinforcing Success in Pharma Logistics With the newly opened Life Sciences Excellence Centre (LSEC), Agility has reinforced themselves as a market leader in pharma logistics. Satish Lakkaraju, Chief Commercial Officer, Agility Logistics Services Private Limited, in a candid interview with Nicin Varghese speaks about his expectations regarding LSEC and their successful growth rate.
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Life sciences is one of the cornerstones of the Indian economy with exports expected to grow at an astonishing 60 per cent in 2017. On similar lines, please share your expectations regarding Agility’s newly opened temperaturecontrolled life sciences storage and handling facility in Hyderabad. India is one of the biggest exporter of generics in the world. With stringent quality and FDA guidelines coming into place, the manufacturers are demanding more compliant facilities for cargo handling. We call ourselves the specialists in handling logistics for the life sciences customers and have never shied away from investing in facilities for temperature controlled cargo. In fact we set up the Pharma Competence Center at Nhava Sheva way back in 2012, even before we had any customers on board. As customers started using the facility for the ocean export shipments, they understood the benefits and currently we have around 15+ pharma customers who regularly use this facility. Hyderabad is one of the largest hub of Pharma manufacturers. When we did our first customer event in June 2016, we got a very good response from the pharma customers. By the time we inaugurated the Life Sciences Excellence Center (LSEC) in February this year, we already had many customers onboard to use this facility. LSEC is a reiteration of our philosophy that if you develop world class facility, customers will automatically come. The new facility in Hyderabad is strategically located near the Hyderabad International Airport and can handle temperature controlled shipments in various temperature bands. The facility is also equipped to handle va-Q-tec containers, a temperature controlled passive packaging solution. Through this facility we can cater to our customers key pharma hubs in Vizag, Goa, Bengaluru and other neighbouring areas. We are positive that our new venture and its success will only reinforce the fact that Agility is the market leader when it comes to pharma logistics.
According to the 2017 Agility Emerging Markets Logistics Index, India was picked as the most favoured destination for logistic companies to invest in. Do you think India has the potential to secure the first position in another five years? India is currently the fastest growing economy in the world. In the “Ease of Doing Business Index” prepared by the World Bank, India’s position has improved significantly over the last few years. India received the FDI of $46.4 billion in FDI in 2016 alone, an 18 per
cent growth over the previous year. During the same year global flows of FDI fell 13 per cent. So you can see there is a strong positive sentiment in favour of our country. We are also seeing many growth oriented policies being made by the current government to develop a conducive business environment for companies looking to invest. We are also seeing an ever-growing interest in the Indian market. Companies who had earlier skipped the Indian market are lining up to set up shop in India. There is a strong intent by the government to develop world class infrastructure. And as new businesses crop up in India, the demand for logistics services will definitely increase. So, I really don’t see why India can’t be picked as the most favoured destination for logistics companies to invest in the next five years or may be even earlier in the Agility’s Emerging Markets Logistics Index. We call ourselves the specialists in handling logistics for the life sciences customers and have never shied away from investing in facilities for temperature controlled cargo.
Agility has reported a net profit of approx. $190 million for the year 2016, an increase of ten per cent compared to the last year 2015. How does Agility provide error free and successful logistics solutions? Agility has always prided itself in being one of the market leaders in the emerging markets. We are always looking at new investment opportunities and are keen to set up infrastructure in these markets. It’s this approach that has yielded results for us in the past and continues to yield the results even today. We have a strong emphasis towards following the processes that ensures error free and successful logistics solutions for our customers.
What kind of tailored services do you provide to your automotive logistic clients? For our automotive customers we can offer end to end solutions. Before signing up with new customers we do an elaborate study of their existing setup. We identify lacunae and areas of improvements in the existing setup and make suggestions which can add value to the customer based on our analysis. This means every solution offered to our customer is unique in some manner.
Could you elaborate to us about your warehouse management solutions and storage solutions? We are really strong in the contract logistics business and have over 1,50,000 sq mt of warehousing space at 51 locations spread across India. In warehousing management services, we provide warehousing services, distribution, primary transportation, spare part logistics, reverse logistics, express delivery, etc. We also offer value added services to tailor made according to the customers need.
What is your take on developing Indian airports as integrated multi modal hubs? Do you think this will ensure quick and smooth handling of cargo? Our airports especially in the metros are really congested handling air cargo and passenger traffic. If we are able to achieve an integration of the airports, it will definitely help in improving the movement of the cargo across India.
The consumer durables industry is extremely competitive and the products are mostly fragile. What is the pattern of consumer durables transportation? Is there any specific route management strategy adopted in the overall logistics and transportation process? We plan the movements of consumer durables in such a way that only one type of equipment is carried in a FCL. This ensures uniformity in loading/unloading. It helps in faster movement of cargo and with better safety.
How has the Indian market evolved for the group till date? We started operations in India in 1998 as Geo Logistics. Currently, I can comfortably say we are among the top ten freight forwarding companies in India. In a span of two decades we have achieved a significant leadership position in market. We believe that we have come a long way.
What are the projects in pipeline? We are looking to further develop our product range under the life sciences vertical and are exploring new products which can add value to our customers. The global management team of Agility is committed to the emerging markets and to India. We always look to add value to our customers, even if it involves significant investments. We have some plans for this year and some long term plans which we will unveil in due course, till then you can wait and watch.
april 2017 - CargoConnect 65
Interview
We are planning to form strategic alliances with like-minded companies: Rama Krishna Kribhco Infrastructure Limited (KRIL) is providing multimodal logistics solutions to its customers since December 2009 and moved its first rake from Hazira. Being involved in the operations of multiple terminals across the country, KRIL has emerged as a major player in this domain and has further plans to reach to the top by coming up with world class facilities at terminals and continually upgrading their systems with technology at the helm of things. N Rama Krishna, General Manager (Marketing and Sales), Kribhco Infrastructure Limited, in an exclusive interview with Tariq Ahmed, talks about their cargo handling operations at different terminals across India and much more.
Kribhco Infrastructure Limited has been operational since December 2009 and has been providing its services across the country. Tell us about the genesis of your operations? How has the journey been so far? Kribhco Infrastructure Limited is a Category–I license holder from Indian Railways for running Container Trains in the country. It is currently operating with 8 rakes and 1350 containers. It offers services PAN India for domestic as well as EXIM movements. At present, Kribhco Infrastructure Limited owns and operates Inland Container Depots (ICDs)-cum-Private Freight Terminals (PFTs) at: • Hazira (Surat, Gujarat) Custom Notified on:13 Sep 2012 • Hindaun City (Rajasthan) • Modinagar (Ghaziabad, UP) • Pali (Rewari, Haryana)- Custom Notified on: 6th July 2015. • A Joint Venture of Terminal at Timmapur (Hyderabad, Telangana) Hazira was notified as an ICD and PFT in 2012 and for Coal Handling in December 2014. The Hazira Terminal of KRIL is the only and closest
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terminal to Adani Port with least transportation cost. It is also strategically located to cover the industrial hubs in Daman, Silvasa, Surat and Vapi. It is spread across 214568 sq meters of land with location adjacent to NH – 6, and good connectivity with the NH-8. Hazira has 3 full rail lines and 5 stabling lines; 3 handling platforms with service roads; a custom bonded area of 24,668 sqm; an EXIM Warehouse 2,000 sqm and a Domestic Warehouse of 5075 sqm. Rewari terminal of KRIL is operational since Jan 2012 and notified as PFT since June 2012. It was notified as ICD since Sept 2013. ICD Pali is also C-TPAT Compliant now. It is spread across 80 acres of land with location along the NH-8 and good connectivity with Sate Highway-24. It is strategically located to cover the industrial hubs in NCR, Haryana, and Rajasthan. KRIL’s Rewari ICD is located closer to ports as compared to other ICDs in the NCR. It is also adjacent to the Dedicated Freight Corridor and is located on notified Double stack route – Mundra & Pipavav. ICD Pali has 7.5 Acres of Custom Bonded Area, 24000 sqm EXIM Warehouse area, and 2 Domestic Warehouses of 1400 sqm each. ICD Pali also
has facility for storing Edible Oil in Tanks of capacity 3300 KL. The Modinagar terminal of KRIL is handling containers since March 2014 and is PFT notified since February 2014. It is spread across approximately 100 acres of land strategically located along NH-58 and ensures proximity to NCR, Uttaranchal, and Haryana. It has 3 full lines, a customs bonded area of 7 acres, EXIM warehouse of 2,000 sqm, and Domestic Warehouse as per customer requirements. Modinagar provides a facility of 2 Edible Oil Tanks of 1600 KL each having semiautomatic storage and heating arrangements. ICD Modinagar is the 2nd terminal in NCR to compliment Pali and is located in the reefer hinterland for EXIM. The Hindaun City Terminal is located in the Kota Division on Main Delhi – Mumbai Rail Line and was notified as PFT since March 2015. With all these facilities at the terminals and rakes, the purpose of the company is to create a complete logistics experience for its customers wherein KRIL provides hassle free, reliable, cost effective and door to door logistics solution including first and last mile connectivity.
Please elaborate about your cargo handling and container handling operations at different terminals across India? Hazira has 3 full rail lines and 5 stabling lines; 3 handling platforms with service roads; a custom bonded area of 24,668 sqm; an EXIM Warehouse 2,000 sqm and a Domestic Warehouse of 5075 sqm. ICD Pali of KRIL is an 80 acres facility in the heart of industrial belt of Haryana with two railway lines; three warehouses – two dedicated for domestic movement with an area of 1400 sqm each and one dedicated warehouse of EXIM of 2000 sqm. There is a custom-bonded area of 7.5 acres at ICD Pali. The terminal is equipped with facilities like Weighbridges, Edible Oil tanks, dedicated transporters and equipment operators. ICD Modinagar of KRIL is a 100 acres facility based out of Ghaziabad-Meerut border with three railway lines, three Warehouses i.e. two Domestic Warehouses of area 2000 sq mt and 5400 sq mt and one EXIM Warehouse of 2000 sq mt. There is a seven acre facility of Custom Bonded Warehouse. The terminal is equipped with Rail and Road Weighbridges, Edible Oil Tanks, and CCTV security.
In a recent news, Indian Railways is taking the lead for freight movement across boundaries by planning a freight route from Dhaka to Istanbul. Can you outline the reasons for this modal shift from surface transport to rail transport in the recent years? Yes, there has been a modal shift from surface transport to rail transport in the recent years but this trend is seen mainly for Long-Distance Transport of Goods as carrying goods by rail is efficient for long hauls. a. Rail transport is capable of high levels of cargo utilisation and energy efficiency. It is suitable for bulk delivery and for transport of bulky, heavy and cheap goods over a long distance. b. The ability to transport and handle goods in bulk is a key advantage for rail transport. c. Cost of transport of goods and passengers over a long distance is comparatively cheap in case of railway transport. d. Also, the rail freight is cheaper than road freight as rail cars can carry larger volumes over greater distances in lesser time. e. Movement of goods, that include perishable items, by road was a huge challenge due to lack of refrigeration facilities and thus, created enormous wastes. Whereas, this cargo can easily be transported through railway in reefer containers.
f. Continuous developments in ICD infrastructure and facilities like heating facilities, warehousing, plug-in facilities for reefer containers, etc makes transportation of cargo by rail a preferable choice. g. Another reason for this shift to railway transport is the traffic congestion on road at a national level which is increasing constantly, leading to delay in delivery of goods to the destination.
What major transformations are you expecting in the bulk logistics segment in India during the upcoming five years? The logistics market in India is expected to be worth US $307 billion by 2020. This sector is expected to grow at a CAGR of 15-20 percent between FY 2016-2020. This growth will be driven by infrastructure investment associated with logistics development plans (ports, logistics
The increase in investment from both public and private sectors year on year will uplift the logistics sector to the next level. parks, highways, freight corridors, and roads), domestic demand growth, and increase in trade. The increase in investment from both public and private sectors year on year will uplift the logistics sector to the next level. With a significant push on the improvement of infrastructure, adoption of technology and dedicated logistics corridor across all the modes (road, rail, air and sea) will improve the overall structure of the Indian logistics market. This will further contribute to the growth of the industry per se.
GST – which is expected to be a game changer – will be rolled out in the next few months. It’s going to reduce the overall logistics costs marginally as companies will no longer require having warehouses in different parts of the country. Now, considering the fact that India is a ‘Geographical Mammoth’, do you believe the concept of centralized warehousing can become a reality in India? As has been rightly said, India is a ‘Geographical Mammoth’, and Central Warehousing would rather make supply chain management a more effective and efficient process. Currently, there are a lot of small distributed warehouses all over the country due to which
warehousing system on the whole is highly unorganised, and the operating and inbound costs such as warehouse expenses, inventory management expenses, and transportation expenses are very high leading to increased overall logistics costs. But for making Centralized Warehouses an effective system, the only thing that is needed is identifying strategic locations across the country for building the same. This will result in better inventory management. Companies can employ other 3PL and 4PL logistics companies to further channelise the distribution of goods and inventory from these Centralised Warehouses. This would in-turn make the supply chain better organized leading to increased customer satisfaction.
In di a n R a ilw a y s o n 2n d M a r c h launched a RoRo service from Gurgaon which is a new model for multi-modal transportation. What are the main takeaways of this service and how is it going to impact its stakeholders? The RoRo service is a boon for Delhi as it would have a direct impact on its air ambient quality and the capital would breathe clean air as the Ro-Ro service aims to reduce carbon emission and congestion on the roads of NCR as about 66,000 diesel-guzzling trucks pass through Delhi and its adjoining areas in a day. According to railways, there are about 20,000 trucks which are not meant for the NCR, but enter the region to travel further. There are 8 entry/ exit routes in the NCR which will be utilised for Ro-Ro service to take trucks off the road. It is a win-win situation for truckers as well as for railways as goods will be transported in safe and faster way, saving cost on diesel & man-days besides reducing the pollution level.
What plans do you have in the pipeline for expanding your arms in the logistics sector? We are planning to form strategic alliances with like-minded companies in the logistics sector to promote KRIL and attract new customers for the organization. There is focus on making consistent efforts towards Opening Bill of Lading and Bill of Entry Points of some more Shipping Lines for all KRIL ICDs. We aim at bringing in more PFT business for our terminals, laying focus on marketing & selling warehouse spaces at KRIL ICDs. With the custom notification of ICD Modinagar almost near completion, the aim is to acquire customers for EXIM Movements from ICD Modinagar with major focus on Reefer Cargo and waste paper and general exports in the catchment area of ICD Modinagar.
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Interview
Catering To the Pharma Industry with Network Expansion and Product Innovation 68 CargoConnect - April april 2017
With the newly announced additional Pharma Express flights and the longest flight to NewZealand, Qatar Airways Cargo has extended their territories with most modern technology and a seamless flow of operations. Ulrich Ogiermann, Chief Officer Cargo, Qatar Airways Cargo, in an exclusive interview with Nicin Varghese, talks about his expectations regarding the newly added frequencies.
Qatar Air ways Cargo has recently announced the launch of additional Pharma E xpress flights from the pharmaceutical hubs of Basel and Brussels to Doha. With these newly added frequencies, what are your expectations regarding the global pharma industry? Our research shows that global spending on medicines will reach $1.4 trillion in 2020 according to a report by IMS Health. This is fueled by increased healthcare access in emerging markets, new drug discoveries tied in with enhanced research and clinical trials, rapid growth of biologicals and funded vaccination programmes. To cater to this rapidly growing and evolving niche market, we are constantly improving our QR Pharma product to cover the entire transportation spectrum from end-to-end, as we believe the logistics sector plays a vital role in the safe and secure transportation of pharmaceuticals and healthcare products globally. We are seeing a double digit growth each year in our pharmaceuticals business and this continues to improve as we expand our customer and geographical base with continued network expansion and product innovation. Therefore, we are strategically expanding our operations and connect the world’s major pharmaceutical hubs such as Basel and Brussels to more than 150 destinations worldwide via our Doha hub.
Air cargo standards for handling time and temperature sensitive cargo are becoming more stringent. How does Qatar Airways Cargo ensure an uninterrupted and transparent cool chain to the end users? Our specialist QR Pharma product offers active and passive transportation for our discerning customers. Both solutions have a high loading and handling priority, including late cut off times and prioritised destination delivery for QR Pharma shipments. Our dedicated climate control hub operations team proactively monitors every QR Pharma shipment from origin to destination, ensuring a seamless product delivery. QR Pharma offers tail-to-tail Quick Ramp Transfer (QRT) at the hub, with temperature-controlled vehicles to provide protection from ambient conditions during ramp transportation. To enhance our QR Pharma product offering, we have a dedicated CAPA team (Corrective and Preventive Action) team who manage all deviation investigations centrally. At the moment, we are nearing the completion
of our state-of-the-art Climate Control Centre within our cargo complex in Doha. The GDP compliant 2,471sqm facility will enhance our ability to process more volumes quickly within a climate-controlled environment. The Climate Control Centre has two zones operating for 2-8°C or 15-25°C with capacity to hold a total of 156 ULDs at a time. Segregated sections will hold pharmaceutical products in compliance with GDP regulations. Six truck docks with inflated curtains will be installed to seal around the truck when docked, to ensure complete temperature integrity. The facility will enable us to handle an additional two million tonnes throughout per annum.
The motto of our company is to follow our customer. Majority of our services were arised from the demands of our customers. Qatar Airways launched the world’s longest flight by touching down on the North Island of New Zealand. Taking advantage of New Zealand’s 90-day tourist visitor visa on arrival for GCC citizens, how do you foresee the future? Auckland is the first city in New Zealand to be served by Qatar Airways and will provide a gateway for travellers to visit the stunning country, which is famous for its spectacular coastlines and lush forest landscapes. We welcome the opportunity to connect travellers from the GCC to New Zealand, and the visa upon arrival is a wonderful convenience for our customers. The Doha-Auckland-Doha daily services offer 116 tonnes of belly-hold capacity every week to support the growing imports of raw, industrial and consumer materials into New Zealand. At our Doha hub, we offer QR Fresh, a seamless temperature-controlled handling and storage solution, to deliver perishable products such as dairy produce, meat and fruits from Auckland into the Middle East and some major European cities.
What are your future plans on expanding Qatar Airways Cargo’s territories? We will be receiving two Boeing 777 freighter this year in the month of March and September, taking our fleet count to 22 by end of the year. The delivery of new aircraft will increase our overall capacity significantly and subsequently. We will be
looking at enhancing our transit facilities, product offerings and service quality. Our belly-hold operation and capacity will magnify in months to come as the airline announces 14 new passenger destination for 2017 and 2018. It is our conscious strategy to divide our cargo capacity across our freighters and passenger aircraft to optimise capacity and adjust our services flexibly to meet customer needs, market demand as well as the dynamics of air freight business. On the facility front, our fully automated cargo terminal at Hamad International Airport in Doha is indeed a hub for global connectivity. Reaching approximately 80 per cent of the world’s population within six hours, we are at a distinct advantage over our competitors in other regions as Doha is strategically located within the world’s key trade markets. Anticipating tremendous capacity growth in the near future, the plan to construct our second cargo terminal in Doha in currently underway. Stretching across 110,000 sqm, the new facility, combined with the current terminal, will allow us to handle 4.4 million tonnes of cargo a year, complete with cutting-edge handling equipment to provide support and solutions for air transportation of perishables, pharmaceutical products, live animals and general cargo.
Tell us about your cargo services in Indian market? Also, what is your current cargo capacity in India? India is an extremely saturated and highly competitive market for both local and international air cargo players. Subsequent to its depreciating currency, the market has become extremely competitive where yields continue to go down faster than other markets. For example, air freight yield was hitting USD 1.80 in general for exports in Q1 2015, yet today the yield is barely above USD 1.30 despite the steady capacity growth in India, recording over 1.4 million tonnes air freight in the past 12 months. India remains one of the strongest exporters in the world, with clothing and accessories, food and fresh produce and pharmaceuticals top its commodity chart. (Data source: World ACD and Seabury) Qatar Airways currently serves 13 destinations in India, out of which seven are paired with our A330 freighter services, offering 2,700 tonnes of belly and freighter combined cargo space to support its massive export businesses. Mumbai, Kolkata, Bangalore and Chennai remain our key routes that connect through Doha to the country’s import partners in Europe, Africa and the US.
april 2017 - CargoConnect 69
Interview
Frankfurt Airport, with its wide range of flights and destinations, is one of the world’s most attractive transfer hubs. How does the cargo department make maximum advantage out of this? Frankfurt Airport serves as a strategic gateway and logistics cluster for all companies doing business in Germany and surrounding countries. Our leading competitive position is based on optimal market conditions available at FRA. Frankfurt stands out not only because of its central location in the heart of Europe, its first-class infrastructure but also because of its route network. FRA offers shippers the largest destination network in Europe and has the highest forwarder density in Europe. As cargo department, our main focus are our customers. We always strive to provide our customers an excellent service and to meet their wishes and requirements. With a functioning and powerful infrastructure, we want to facilitate the work of the more than 450 cargo airlines, forwarders, cargo handlers and other service providers that have settled here. We want to offer optimal conditions so that their goods arrive safely and right on time. However, we realized early on that we, as the airport operator, are only one part of the air cargo supply chain and in order to increase the overall efficiency of processes, we must leverage the strengths of all our supply chain partners. For that reason, we have founded the “Air Cargo Community Frankfurt”, an association that brings together all the players involved in the air cargo business and is dedicated to represent and promote the interests of air cargo-related companies at FRA and to optimize the logistics processes. We closely cooperate, so we can maintain our position as Europe’s leading cargo hub.
In terms of cargo volumes, Frankfurt Airport is Europe’s largest airport and ranks among the top ten airports worldwide. Do you foresee yourself on the first position in another five years?
Meeting Customer Demands With World-Class Infrastructure Being Europe’s largest airport and the top ten among worldwide, Frankfurt Airport stands out with its world class infrastructure, central location and route network. Dirk Schusdziara, Senior Vice President Cargo, Frankfurt Airport in an exclusive interview with Nicin Varghese speaks about their strengths and future projects.
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With 2.2 million metric tons of air cargo in 2016, Frankfurt Airport once again ranks among the top ten cargo airports. In the last quarter of 2016, our figures grew by more than 3.3 per cent. Both the German and the European air cargo market have been growing significantly towards the end of the year 2016. The global economy is recovering which is reflected in an increasing demand. The start into 2017 is quite promising with the second best January-result in our history, so we foresee to continue the success of 2016 also this year. Of course, there is a tough competition between the huge cargo hubs but we are positive that we will always be among the leading cargo hubs and especially strong in general cargo. Our customers know that we have the expertise and experience to move practically any type of product in a fast and efficient way.
Please tell us about the Frankfurt Air Cargo Innovation Lab and its futuristic projects? Pushing innovation forward is a top priority for us. We want to be known as the innovation leader in the air cargo supply chain. In real terms, this means always searching for new solutions in order to offer our customers faster
processes, greater reliability and transparency – and thus an improved service. However, we believe that innovations are not brought into being by single individuals. Ideas have to be shared and discussed in open dialog so that new ideas can be developed together. The need to collaborate will shape the industry in the next years. Everyone has to be willing to exchange information, has to agree on common standards, has to push forward innovations. We have to develop from an ‘ego-system’ where every company works only for itself to an ‘eco-system’ where we all join forces – in order to stay competitive as an industry as a whole. Our Air Cargo Community Frankfurt is a perfect example on how we could work together in future. Furthermore, last September, we invited the most influential thinkers in the sector, together with the wider industry and the research sector to the first Frankfurt Air Cargo Innovation Lab. Interactive workshops and discussion rounds motivated around 100 attendees to discuss the future of logistics and engaged in dialog with one another on how to respond to current trends in the air cargo business. Because of the huge success, we are already planning the next Air Cargo Innovation Lab which will take place on September 26th and 27th this year.
On a discussion on the future of logistics at the Frankfurt Air Cargo Innovation Hub, you were quoted as saying, “Increasing digitisation will change our sector over the coming years”. How far has Frankfurt Airport been able to digitize its supply chain processes? Digital transformation is very important for our industry. Integrators have already been disrupting the market with their integrated logistics concepts for a while. The traditional air cargo process is very fragmented and characterised by many individual players – truckers, forwarders, handlers and airlines. Digital development now provides the opportunity to offer faster, more efficient and more transparent processes. Also with regards to digitisation, we consider ourselves as a leader in the industry. We started pushing forward digitisation at FRA with the launch of FAIR@Link. Today, Fair@Link represents one of the most advanced cargo community systems at any airport worldwide. The system enables the electronic exchange of data between participating companies. It digitally networks the players in the air freight chain and thus improves the physical processes between them – not just within the CargoCity, but also well beyond
its perimeters. All users have confirmed that FAIR@Link helps to decrease various cost factors as a result of shorter waiting and loading times and higher employee productivity. World gets around and so the number of new customers is steadily growing ever since the platform was officially launched. At the moment, we are planning on adding some additional functions to Fair@Link. Government agencies are very interested in obtaining an interface to the system. The German Customs’ system is already linked to Fair@Link and we have just begun to integrate the local EU border checkpoints for plant protection and veterinary examinations as well as the German Federal Office for Agriculture and Food. We also want to connect the shippers to the system, so they can enter data directly to the system. This proves especially interesting for special handling products like perishables, animals and DGR where many data has to be transmitted.
The start into 2017 is quite promising with the second best January-result in our history, so we foresee to continue the success of 2016 also this year. Furthermore, Frankfurt Airport and also the Air Cargo Community Frankfurt work closely together on projects with IATA in order to support the implementation of a paper free process. We are always very interested in any new idea to further pushing e-cargo. Therefore, we cooperated with IATA by supporting the “eAWB360” campaign at FRA and moreover, we joined the IATA interest group “cargoIQ”. Additionally, we are currently developing a digital access control system to facilitate access to our cargo area. While currently, all visitors to our CargoCity have to register at the entrance gate, the new system will allow them to register online beforehand so that they can directly proceed to their destination without stopping at the gate.
Frankfurt Airport was recognised as the best international freight airport at the ‘Air Cargo India’ trade fair last year. Please tell us about your bilateral trade relations with India. How has the market evolved for you till date? Germany is India’s biggest trading partner in Europe. Especially fashion, jewelry and pharma products are important products groups.
Consequently, India is also a very significant market for Frankfurt Airport. More than 70 passenger flights and some 20 freighter services are operated weekly between FRA and several destinations within India. In 2016, India has been one of our major growth drivers for our airport with an increase of cargo volumes by 9.4 per cent. India’s logistics market being increasingly important for FRA’s cargo business, we organized two shippers’ days last year. In February, we hosted the “Air Shippers’ Forum” during the “Air Cargo India” conference and exhibition in Mumbai. In December, we hosted the first Automotive Supply Chain Management Summit (Auto SCM Summit) held in Pune. The conference brought together numerous supply chain managers of automotive manufacturers and logistics service providers, as well as customs officials to discuss ideas and share best practices to mutually benefit each other.
Cargo City Frankfurt has evolved as the biggest European hub for global cargo logistics. Please talk about the available facilities and your expansion plans? Frankfurt Airport features dedicated facilities and equipment for all types of cargo, including Europe’s largest airfreight center for perishable goods, the world’s most modern airport animal station, and various facilities for valuables, dangerous goods, pharmaceuticals, or express services. Fraport and its partners are continuously investing in the infrastructure at FRA in order to meet the demands of our customers. Our CargoCity South will be continuously extended by a total of 100,000 square meters during the next few years. Another big project is of course our Terminal three, which is currently being built in the southern part of FRA. When complete, the new terminal will add cargo capacity and improve access to our cargo areas thanks to a new highway interchange. Moreover, due to the huge demand in the pharmaceuticals sector, several parties are expanding their facilities. At the end of 2017, Frankfurt Airport will have even more than 10,000 square meters of temperature-controlled areas that guarantee the fast and reliable handling of these sensitive products. Last, we are also planning a second truck parking lot because of the huge demand. Two years ago, we opened our first truck parking lot which was very well received. The new facility has reduced traffic congestion and enhanced the overall experience for truck drivers.
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Interview
All geared up…
Supply chain group Tigers has launched a new marketplace, called eShop, to support brands entering the rapidly expanding China and Southeast Asia e-commerce markets. The digital marketplace, part of Tigers’ suite of e-commerce products, offers a one-stop shop solution, from marketing, to taking payments, managing the supply chain, order fulfilment and returns. Feeling optimistic about the new projects and services, Andrew Jillings, Chief Executive Officer and Group Managing Director, Tigers Group, in an exclusive interview with Tariq Ahmed, shares his vision about the company and much more. Here are the excerpts:
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Tell us about the genesis of your operations. How has the journey been so far? It has been a challenging and exciting journey. We initially acquired a distressed, Hong Kong based logistics group, called WLG Incorporated, who had operations across China,and Australia, as well as offices in the USA and the UK. Shortly afterwards, GeoPost, the investment arm of LaPoste, acquired a minority stake in WLG and financed the acquisition of Kamino, which increased our USA and European presence. We decided to rename this company ‘Tigers’. In order to enter the e-commerce market,we created a neutral e-fulfilment product called ‘eTigers’ which encompassed omni-channel fulfillment, final mile deliveries, and the returns business. Today, eTigers is the fastest growing product in the group and we operate 35 fulfillment hubs across China, USA, UK, Germany, the Netherlands, Switzerland, Australia, Malaysia, and South Africa. Recently Tigers signed an agreement with POS Malaysia, whereby POS will now outsource their e-commerce fulfillment to Tigers, who will then run this out of a bonded airside facility at the Kuala Lumpur International Airport. This is very exciting for Tigers, enabling us to expand the eTigers product in to the dynamic south-east Asian markets by linking directly to POS Malaysia’s second day, and express delivery, services around the region. Since changing our name to Tigers, we have made several other acquisitions that include SupplyLinq, Cargo Traders, and WorldLink International in Australia. SupplyLinq expanded our contract logistics operations on the East Coast, while the purchase of WorldLink provided us with new opportunities in the dynamic, Asean, perishable market. Today, Tigers are one of biggest exporters of live seafood from Australia through to China. We then acquired a niche, ocean consolidator in the south-east of the USA called Universal Freight Brokers, before also acquiring Lochhead White and Wormersley in South Africa, both of which offered us a strong and well-established base (LWW were originally founded in 1869 in the Cape of Good Hope, making them one of the oldest logistics groups in Africa) in Southern Africa. In 2014 we acquired the operations of Signet International in the UK and, earlier this year, we merged the operations SeaCastle in South Africa into Tigers South Africa. From the very outset, our goal was to ensure that we stayed at the cutting edge of technology, and, consequently, today Tigers runs its global operations on a cloud-based operating system. We also maintain a policy of moving all acquisitions onto the system immediately after closing. For our expansion in e-commerce, we developed SmartHub, which links our global warehouse management system to vendors and customers efficiently and seamlessly.
This year we launched the Tigers eShop in China and Hong Kong, and similarly plan to roll out the eShop into the USA, Germany, UK, Malaysia, Australia and S. Africa over the next 18 months. The eShop is essentially a market place for Tigers’ customers to trade their products online in the dynamic Chinese market. Through the eShop, Tigers has created an enterprise solution where they can manage a customer’s international supply chain, and manage B2C fulfillment in Hong Kong and China, while still providing a full fiscal representation to customers who do not wish to establish legal entities in the region. It also means that we can trade the customer’s products on the eShop and handle the returns business. Today we have 65 offices in 11 countries and our turnover is just over $800m.
What kind of investment opportunities do you see in India? Are the government’s proactive policies to increase FDI inflow (e.g. 100 per cent FDI) a huge push for companies like Tigers to venture into India? Tigers has its own operations in India and sees the market as strategically significant. We are currently working on plans to expand our network in India and to launch eTigers. There are a number of investment opportunities, but our strategy is to expand organically by investing in people, systems, and training.
Give us a brief idea about eTigers? Tell us about the gamut of services associated with it. eTigers is a neutral, omni-channel fulfillment model, that covers B2C and B2B fulfillment, as well as the handling of the returns business. Through SmartHub, we work with the most cost efficient final mile operators from the postal services to express operators.
The world is moving towards IoT. Its applications are diverse and its opportunities are endless. So, how have you implemented IoT in order to better streamline your products and services? Tigers consider IoT to have numerous possibilities in both the global supply chain, and in more tactical operational areas. With this in mind, Tigers believe that there are two significant elements required to manage this key innovation.Firstly, identifying the areas and niches that will best add utility and benefit to operations and customers. Our parent company DPD Group is a world leader in this area, and has a number of key innovations such as real time temperature monitoring of B2C shipments for the perishables business, the use of drones, and passing real time delivery truck positions
to B2C customers waiting for a delivery. Tigers is in the early stages of working with various partners on wearable technology for use in e-commerce, where the pace is too fast for normal RF gun use. Secondly, Tigers have worked hard to streamline and optimize their internal IT systems and processes to ensure that they can rapidly adapt and roll out this new technology. As such, they have implemented a single global operational platform for both freight and warehousing, as well as a common global IT innovation platform, called SmartHub. Microsoft Azure based SmartHub, allows Tigers to not only provide any-toany integration to all internal and external systems, but also allows Tigers to add value to that data by rapidly deploying self-built cloud application, like their eShop, and also link into external systems providing new features and data sources for IoT and other technology innovations, for example Big Data.
From the very outset, our goal was to ensure that we stayed at the cutting edge of technology, and, consequently, today Tigers runs its global operations on a cloudbased operating system. Warehousing has an enormous potential to benefit from automation. With Amazon using its Robotics division to help with picking orders, restocking and shelving, there’s a lot of buzz about robots replacing employees. What is your comment on it? Tigers believe that there is a lot to be gained from automating physical processes, but also in automating data processes similarly. Tigers’ main logistics business is in multi-user facilities, with many customers having vastly different and often highly customised processes. While physical automation is limited in Tigers’ warehouses, process automation is becoming increasingly common. An example of this would be Tigers’ ScanPack that allows packers to scan and check the contents of an outbound parcel and print out the required documentation, perform or assist in value added service (add a free gift for example), and
also select and contact the courier based on rules or rates. The next parcel to be worked can then follow a different pattern entirely.
Demand for apparels generally has a short span of life due to the everchanging trends in the market. In such a scenario, how important is the timely delivery of goods carries in transportation of apparels? The trend towards fast fashion brings a number of challenges in the supply chain industry, given that a $50 shirt needs the same consideration as a $500 phone. Tigers has a number of products and solutions that help their customers in this regard. Firstly, a hybrid sea-air product allows them to massively speed up transit times between China and Europe as well as the US, much more so than ocean, and reduce greenhouse emissions and cost compared to air only. The TigerPac product is designed to not only facilitate origin/destination consolidation, but to also produce retail ready merchandise at origin when garments would otherwise be waiting for a sailing and importantly allowing trans-shipment direct to the retailer at origin, avoiding any further delays. Lastly, Tigers recently launched the Tigers Gravity system, which allows their customers the first truly end-to-end visibility experience in the fashion business; literally from concept/plan board through PO/Booking and delivery to store/ end consumer. In addition, Tigers Gravity uses big data to monitor thousands of data sources, including news sources, for issues that might affect their partners and their extended supply chains
Considering that perishables and temperature sensitive shipments poses a high risk of damages due to even the slightest deviations in temperature, how to you ensure a timely delivery of such products? This can be a challenge as aircrafts do occasionally breakdown, as do container vessels. Our focus is on working with tried and tested partners, and ensuring that we monitor temperatures on all shipments so that we know where on a journey temperatures changed to above the agreed median. Good data enables Tigers to better manage the unmanageable.
What are your future plans for expanding your arms in the logistics sector? We see the growth predominantly in 2C fulfillment in emerging markets, and we are focused on expanding the eTigers product in the Asia Pacific, parts of Africa, the USA and across Europe.
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guest column
Stop Cargo Theft From Stealing Your Profits By Sushant Sarin
GPS technology is more effective when coupled with a system that can remotely control and stop a stolen vehicle. It has become a necessity to install GPS in regions where theft is most prevalent.
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T
heft of cargo during transportation is a common and very frequent cause of loss to cargo owners. In India drivers stop at clusters of wayside dhabas for bio, tea and meal breaks leaving loaded trucks unattended and exposed to theft and pilferage of cargo. Abroad, when they stop at truck stops to use the rest room or grab a bite, drivers leave trucks idling exposing the cargo to the additional risk of being made off with. Thieves don’t limit themselves to stealing trucks that are conveniently left unattended. Another ploy is to pretend they are the legitimate party hired to pick up cargo at a dock-then simply drive off with the load. Often the trick requires the participation of an insider, who knows when and where the valuable shipments will be available. Another underlying issue that has bogged trucking companies is that the present generation do not wish to become truck drivers and this have led to shortage of trained and skilled drivers. The over-worked and aged drivers are loss potentials, if not by theft then by accidents. This in turn has led to hiring of outsourced drivers, who may or may not be part of a hijacker’s syndicate. This issue is an increasing concern for all trucking companies. Violence does occur from time to time but classic hijackings are more common in hinterlands. Historically, electronics have always been the most
theft targeted cargo of all times but in recent times, it has been edged out by food, beverages and FMCG, which now represent the major percentage of reported incidents. Thieves are drawn by the potential for reselling branded food products and beverages into the legitimate supply chain. In doing this they get 70 per cent of the cargo value versus only 30 per cent for electronics items. Theft of food and beverage items, especially perishables further make them highly vulnerable to contamination when tampered, pilfered or mishandled in transit. An improperly managed cold chain can result in the sickness or even death of consumers. So what can be done? The obvious answer is never to leave a truck unattended, but again how far is that feasible when the crew takes a break together. Drivers can reduce the risk of theft by observing operating best practices that cost nothing: Turn off your engine when you leave the vehicle. Make sure all seals and locks are properly applied. Do not stop for the first 200 miles of a trip. Some criminal gangs will follow a truck from the moment it leaves the dock, hoping for a quick score. There are a number of technology solutions that can help to prevent theft. Major trucking companies have realised potential of geo-fencing, even without actual usage of telematics. The trucks are required to stop at these designated stops only
and same is to be informed to their reporting office by a local phone. These designated stops are either fenced areas or improved version of stops mentioned earlier where trucking company employs security guards. Telematics have been around for a decade now. Initial resistance by truck drivers has now given way to a better understanding of its advantages including a realisation that a simple GPS tracker on the vehicle can save not just the cargo but the lives of the crew in times of emergency. Should there be an attempt to hijack, the driver can hit a “panic alert” button that can relay a signal up to his control centre, who can then inform nearest police station or their own fleet vehicles or members who may be in the vicinity. GPS technology is more effective when coupled with a system that can remotely control and stop a stolen vehicle. It has become a necessity to install GPS in regions where theft is most prevalent eg. Uttar Pradesh, Punjab, Gujarat and Rajasthan. With smart phones in every pocket today, photography has evolved to become a valuable weapon against theft. Supply-chain professionals know the importance of remaining vigilant against cargo theft. For losses suffered despite precautions, cargo insurance is the solution. A good security program however yields the added benefit of better control over one’s market. (The author is the Senior Vice President Commercial lines, Tata AIG General Insurance Company Ltd.)
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guest column
Omni channel strategy By Vikash Khatri
W
ill the traditional way of distribution will meet the purpose of tomorrow for manufacturers and marketers, answer is absolutely negative. Earlier distribution and reach to customers was much more dependent on solo channel of brick and mortar retail with intermediate distributors. Even that channel was fragmented and unorganised. But last decade has seen evolution of strong large format retail stores and technology driven players in retail space. With these evolutions first phase was multi channel, in which there were parallel channels of distribution leading to inefficient supply chain. Multiple parallel channel created following issues for the manufacturers: • D i f f e r e n t i a l b u y i n g a n d negotiating power of channels • D i f f e r e n t m o d e o f communication at point of purchase / interaction • Parallel Physical distribution • Inventory management • Pricing issues • Channel conflicts Due to multi dimensional impact of channel change, organizations need to go for holistic view on channel strategy via omni channel strategy. “omni channel strategy” suggests that all channels are in
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focus and sync on real time basis. The customer can buy across channels, and information about the buying process is available on across channels, ideally in real time. Moving from conventional channel to omni channel strategy is cross functional matter, which involves marketing, supply chain, IT & production planning. So it should be an integrated strategy and execution rather than a supply chain function driven solo activity. The process of Omni channel strategy begins from value creation linked to customer need. Final deliverable of omni channel strategy will be
between this will be possible through consistent data and crossover processes. If the data is not consistent and sources of data are different depending on channels, omni channel strategy is bound to fail. Omni channel caters not only demand of B2C sales, but also integrates B2B channel. Nature of both the slaes is quite different in terms of order size, lot size and order frequency. Physical handling also require capabilities of handling large orders. Based on product portfolio and clients portfolio, back end infrastructure requirements also varies in Omni channel distribution network. In Indian market companies
reduction of response time to customers and efficiency improvement. Which clearly shows two ends of deliverable one is external factors like demand, consumer behaviour, on time availability while other is visibility, cost optimisation, removal of channel conflicts and efficiency of operation. Balance
are also creating their own e-commerce channel capabilities and integrating e-commerce distribution channel with their existing ones. Globally some of large retailers and manufacturers have implemented. One of the best implemented omni channel strategy is of ‘Walmart”. The very next question arise,
from where to start for omni channel strategy implementation. In my opinion it begins from the end point of physical supply chain, that is end customers. At their end we need to identify buying behavior, changes in buying behavior, mode of purchase, their preferences, their engagement with technology etc. Next step is the mode of delivering goods in line with their buying pattern. Mode will get backward integrated to physical location of inventory which can be retail, warehouse, Distribution center etc. On compilation we go for following analysis • Alternate channel options and channel synergies • Inventory flow modeling • Optimal model of supply chain • Technology, process and Infra modeling Implementation challenge: Implementation of Omni channel strategy is easier said than done. It has huge amount of complexity in implementation. As per one of the Global Research of E&Y key barriers are as follow: • Lack of dedicated resources and capabilities • Level of investment required to succeed • Challenge of supply chain complexity • L i m i t a t i o n s o f s i l o e d organisational structures • Lack of senior leadership support In Indian context as well, omni channel strategy adaptation rate is very low. But once the organisation/ retailers see the overall value in integrated approach, they will move to implement it and overcome all challenges. (The author is the Director of Aviral Consulting Pvt Ltd)
Shippers Speak
We have devised a priority system to smoothen the supply chain How important is logistics for the overall scheme of your business? Logistics certainly plays an important role in the business. It would not be an exaggeration if we term logistics as the backbone of our business as it ensures all time ‘availability’ of a product, which is a key for increasing sales.
How smooth coordination is ensured between suppliers, transporters and other departments of the supply chain?
VIP Industries Limited manufactured the first suitcase in the year 1971. Since then, the company has been continuously making travel more and more convenient for millions of people around the world by its wide range of products. VIP was ranked amongst top 100 most trusted brands in a survey by Brand Equity in the year 2009. Presently, the company has more than 8000 retail outlets across the country and a network of over 1300 retailers across 27 countries. Niharendu Sharma Sarkar, DGM, Logistics and Warehousing, VIP Industries Limited, in an interview with Gaurav Dubey, gives an insight of the supply chain of the company.
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We have devised a priority system throughout the supply chain using TOC (Theory of Constraints) principles; which sends triggers automatically of the actions to be taken When, What and How. • Suppliers - The system updates suppliers about when to produce, what to produce and what quantity to be produced. There is no manual intervention in this procedure. The system for warehouses, updates us about when to send, what to send, how to send and how much quantity to be send. • Transporters – SLAs and transit lead times have been agreed upon, with variations duly incorporated. Preventive and safety measures agreed upon, apart from incentive and penalty, monitoring in place. • Other Departments – Entire organisation is aligned towards the “Organisation goal”. Departments get signals and prioritise work accordingly.
Are there any unique or innovative strategy adopted by you for the better supply of the products? We have imbibed TOC principles in the entire organisation. Whole Company is aligned with the TOC. Every day decisions are directed by TOC strategy and tactics. Sales have increased phenomenally and inventories in the system have reduced by following these tactics.
How do you manage back-end supply? We manage our backend supply through a TOC principle called Dynamic Buffer Management System. We also work on the TOC Principle of “ODRF” (Order Daily Replenish Frequently).
What percentage of your logistics work is outsourced? What functions are performed by your logistics partners and what are controlled internally? E xcept one d epa r t me nt, Wa re house Operations, which is outsourced, all the logistics work is controlled and managed internally. We have tied with different logistic partners to move our products from one place to another – on both Primary and Secondary legs - Interstate and Intrastate as well. Transit time is one of the major components of replenishment time and therefore we have a stringent but a simple mechanism to measure it. The transporters are imparted training to make them understand how important role they play in our business. We conduct frequent meetings and discussions to understand each other in-order to improve.
Tell us about the most common problem faced by the company during its supply chain process. What steps do you take to overcome these? We were earlier working under “Push Model” which typically resulted in month end spikes, where in more than 60 per cent of the sales used to happen in last week. We have switched from “Push to Pull” using TOC principles. Now we do not have month end syndrome and sales are spread evenly throughout the month. We are now graduating from primary model of sales to secondary focused sales.
Which are the Logistic Ser vice Providers (LSP) of the company and what qualities the company seeks in them before opting for their services? Presently, we have transporters as our LSP. We place them as per their strength of route (in which they operate) and fleet size. The credentials of the organisations are properly checked. This is for all line haul vehicles (with full truck load) - both Interstate and Intrastate. We have also LSP who work in PTL (Part Truck Load) and they basically partner with us in the secondary mode of transportation. The logic of selection is more or less the same in this case also.
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Warehouse Specifications Modern PEB structure Insulation to reduce temperature Column spacing- 8.4 m @side walls and 16.8 m @ midspan High load bearing capacity- 12 ton/sq mtr Floor height- 1.2 mtrs from road level Building height- 12M @ gable and 17 m @ the centre Sky lights for minimum electricity consumption Turbo ventilators to maintain temperature Internal washroom for staff Sufficient office area on ground and mezzanine Dock levellers
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news
Cabinet approves Customs Convention
Lok Sabha passes GST supplementary bills
The Union Cabinet, chaired by Prime Minister Narendra Modi on 6th March, gave approval for India’s accession to the Customs Convention on International Transport of Goods for faster movement of goods. The Convention will help Indian traders to have access to fast, easy, reliable and hassle free international system for movement of goods by road or multi- modal means across the territories of other contracting parties, a cabinet communique said. “By joining the convention, the need for inspection of goods at intermediate borders as well as physical escorts en route shall be obviated due to reciprocal recognition of customs controls. Customs clearance can take place at internal customs locations thereby avoiding clearances at border crossing points and ports that may often be congested,” it said. “Movement under the TIR can be allowed by checking only the seals and the external conditions of the load compartment or the container thereby leading to increased competitiveness and growth for the trade and transport sectors,” it added.
The Lok Sabha recently passed the much-awaited Central Goods and Services Tax (GST) Bill, Integrated GST Bill, Compensation GST Bill and Union Territory GST Bill 2017, after negating all the amendments put forward by the opposition. All the four bills that were moved by Finance Minister Arun Jaitley in the lower house was passed by voice vote. The historic GST regime is now closer to meet its July 1 target of rollout. Talking to media after the house was adjourned, Jaitley said a significant step forward has been taken and he sees history in making. “With Lok Sabha having approved all four laws that Centre is supposed to legislate through Parl, I think significant step forward has been taken. We are virtually seeing history in the making because we are now going to be transforming into a new system of indirect taxation,” said Jaitley. Earlier, replying to the seven-hour-long debate, Jaitley said goods may become “slightly cheaper” after implementation of the Goods and Service Tax. He said all other taxes like entry tax in states will be removed once the GST is in place. Noting that both the central and state governments are pooling their sovereignty to have this tax regime, he noted that India, despite being one political entity, remained different economic entities with states having different taxes. “India remained different economic entity. Trucks could be seen waiting outside state border, there was no free flow of goods,” the minister said.
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news
Direct Port Delivery failing to deliver
India upgrades standards of major ports
India’s drive to ship packages straight from its ports to importers appears to have hit speed bumps, with infrastructure glitches and the likelihood of loss of business uniting some companies that were intended to be its beneficiaries and freighting warehouses against the federal initiative. Direct Port Delivery (DPD), which began last year with the Nhava Sheva port on the outskirts of Mumbai, entails the delivery of a shipment from the port to the consignee instead of initially holding it at a container freight station (CFS). It now includes 778 importers. The initiative will cover more ports soon. Direct Port Delivery, a global concept, can potentially cut the time between a shipment landing at the port and reaching the factory to one day from nine at present. About 70 per cent of India’s containerised imports now come to CFSs. The government aims to convert 70 per cent of these imports into DPD in the next few years. Yet, some intended beneficiaries — the importers — have said the Jawaharlal Nehru Port Trust (JNPT) at Nhava Sheva faces severe congestion and isn’t ready for the DPD model. Instead of reducing the dwell-time and costs, the model has made things difficult for them, they say.
With a view to improve further the efficiency and productivity of the major ports and make it comparable internationally, a benchmarking study of major ports to international standards has been conducted which has recommended 116 initiatives out of which 70 have already been implemented. Under the Sagarmala programme, the Government has proposed to connect ports with National Highways and Rail network for efficient evacuation to and from hinterland. Fifty rail connectivity enhancement projects have been identified, out of which 25 have been taken up by the Indian Port Rail Corporation Ltd. (IPRCL) for implementation. Similarly, 79 road connectivity projects have also been identified to improve connectivity of major ports with hinterland.
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news
Truckers threaten to go on strike from April 20
Tax check in GST regime
Over 90 lakh trucks across the country will stop plying indefinitely from April 20 if the government fails to meet various demands of truckers by March 30, according to SK Mittal, President, All India Motor Transport Congress (AIMTC), the apex body representing the truck industry. Truckers want the proposed third-party insurance premium hike by Insurance Regulatory and Development Authority to be dropped and sought an urgent meeting with the government to clarify concerns of truckers on Goods and Services Tax, he told newspersons after the 203rd managing committee meeting of the AIMTC here. Many issues affecting the transport industry were discussed at the meeting held here on Friday. “If the government does not meet our demands by March 30, we have no other alternative but to go for a nationwide indefinite strike from April 20,” he said. On third party insurance, Mittal said the Tariff Advisory Committee must be restored, as was earlier, by inducting representatives from the AIMTC.
In services and goods prone to tax evasion, there will be a mechanism under the proposed goods and services tax (GST) regime to make buyers or receivers liable to pay the tax, instead of sellers or suppliers. This is called a reverse charge mechanism (RCM), since it is usually sellers or suppliers that pay indirect taxes to the government. However, these are likely to be only imposed on business to business (B2B) supply of goods and services; not on business to consumer (B2C) movement. Also, farm produce might not come under this mechanism, as farmers are not required to be registered under GST. Under the present indirect taxation regime the RCM is present mainly for services, on 15 of these. The draft GST Bills have a provision for reverse charge in both goods and services. The mechanism was introduced in services with effect from July 2012. However, it was there for only some, such as rent-a-cab or goods transport agency services. The GST Bill’s enabling provision for an RCM has not specified which goods and services will come under it, said M S Mani, tax partner with consultancy Deloitte. At present, a company receiving a cab service is required to pay 50 per cent of the 15 per cent tax on this, 7.5 per cent, to the government. This was introduced because there were many cases of tax evasion in this service, says Mani.
Panel for regulator in container logistics space
Govt readies multi-modal transport play
The Department-related Parliamentary Standing Committee on Transport Tourism and Culture on Shipping Ministry has called for a high powered inter-ministerial group to take policy decisions on internal trade and a high-powered regulator for managing the entire area of container logistics.The committee stated in the report, “The entire container trade is being controlled by overseas MNCs resulting in high operational costs to India internal trade.” The committee observes that transportation in a subcontinent like India has to be essentially based on multimodal system. The committee recommends that a high powered inter-ministerial group may be constituted to take policy decisions on internal trade and a high powered regulator for managing the entire area of logistics of container.
India has firmed up the contours of its ambitious multi-modal programme to reduce logistics costs and make the economy competitive. The strategy involves a reset of India’s logistics sector from a “point-to-point” model to a “hub-and-spoke” model and involves railways, highways, inland waterways and airports to put in place an effective transportation grid. This includes setting up 35 multi-modal logistics parks at an investment of `50,000 crore, development of 50 economic corridors and an investment template which involves roping in the states and the private sector for setting up special vehicles for implementation. To implement this, the government plans to host a multi-modal summit—India Integrated Transport and Logistics Summit—in May, on the lines of the maritime summit to pitch project opportunities to the investors.
april 2017 - CargoConnect 85
news
Fadnavis holds review meeting on new port policy
Ministry writes to States for MMLPs
Maharashtra Chief Minister Devendra Fadnavis chaired a meeting to review implementation of the new port policy. During the meeting, plans for development of ports and rail/ road connectivity to ports were also discussed. There was a presentation on expansion plan of JSW Jaigarh port, Karanja Terminal, Yogayatan Port and Katale Shipyard, Ro-Ro services, a statement from Chief Ministers Office (CMO) said. There was also a presentation on Sagarmala project and the CM gave directions for its effective implementation, it said. Vadhwan port in the state is part of the Centres Sagarmala project. Meanwhile, the CM also chaired a meeting to review preparation for the celebration of 126th birth anniversary of Dr Babasaheb Ambedkar at Chaityabhoomi in Mumbai. Ministers Rajkumar Badole, Vishnu Savara and senior officials from Social Justice, Police and other state departments as well as from Brihanmumbai Municipal Corporation (BMC) were present for this meeting. During the meeting, Fadnavis gave instructions to provide necessary facilities to citizens who visit Chaityabhoomi in huge numbers to pay tributes to Dr Ambedkar, the statement added.
The Road Transport, Highways and Shipping Ministry has written to all State Governments asking them to provide land for developing multimodal logistics parks. Chennai and Vijayawada have already identified land parcels for development of logistics parks, and pre-feasibility studies will be initiated in these two cities on an immediate basis. The logistics parks will help reduce the transportation cost for the top 15 nodes by about 10 per cent, besides reducing pollution, congestion and warehousing costs. He said the plan will serve to make the economy competitive by reducing logistics costs, bring down pollution levels by reducing congestion on roads, give a boost to industry and create employment. Gadkari said the Barak river can be used to move cargo to Imphal. The Minister said fishing can be done beyond 11 nautical miles, for which fishermen can buy trawlers for a subsidy of about `15 lakh under the Mudra finance scheme.
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news
Crystal Logistic raises funding from NEEV Fund
JNPT’s tender call to CFS to take DPD to the next level
Private equity firm Neev Fund, which is backed by India’s largest lender State Bank of India, has struck its second deal this year in a cold chain logistics service provider. Neev Fund, which was launched in 2015, is focused on investing in infrastructure sectors such as renewable energy, road, agricultural supply chain (warehouses and cold storages), urban infrastructure (water and sanitation as well as waste management), healthcare and education. UK Government’s Department for International Development also backs the private equity firm, which is registered with the Securities Exchange Board of India (SEBI), as a Category I Alternative Investment FundInfrastructure Fund. In its latest transaction, Neev Fund has invested in integrated cold chain logistics service provider Crystal Logistic Cool Chain Ltd. A spokesperson of Crystal Logistic, which is promoted by Murari Lal Agarwal, acknowledged the development and said the funding will help in expanding the company’s infrastructure and warehousing capacity by building sophisticated cold chain distribution hubs across India.
JNPT’s latest plan of tender calling out to all CFS operators could prove to be a respite for businesses that suffered initial hit from the Modi government’ latest initiative –Direct Port Delivery. The new plan offers CFS operators to bid directly to operate under the new regime. Brijesh Lohia, MD of Global Ocean Group said, “Although the introduction of DPD is deemed to prove highly favorable for importers, the limitations such as dispatching within 72 hour timeframe and congestion at the port has steered to question if our ports are ready for the DPD model.To begin with, under DPD model, JNPT appointed one single CFS where all goods were offloaded and stored. Another great benefit would be the cost cutting as the key criteria of the tender, as it will allow one fixed cost of handling to be charged by all CFS operators, as contrasted with inconsistent rates charged earlier.
Ethiopian Airlines adds Ahmedabad to India cargo network Ethiopian Airlines announced that it will add Ahmedabad, the carrier’s fifth cargo gateway to India, to its global cargo network as of March 28, 2017. The Addis Ababa based carrier also finalised preparations to launch new flights to Victoria Falls, Oslo and Antananarivo, set to start 26-28 March 2017. Group CEO Tewolde GebreMariam, noted that Ethiopian’s cargo network was, “linking the Indian subcontinent and Africa further with China and Hong Kong; providing the Indian market with minimum weekly import capacity of 240 tons per week.” He added that the new services to Ahmedabad would, “strengthen the existing trade and commercial ties between the two fastest growing regions of the world.” Ethiopian Airline’s anticipates starting operations at its new cargo terminal in Addis Ababa in April 2017. Already Africa’s largest cargo carriers, the new US$150 million facility will provide an annual storage of 1.2 million tonnes and can handle eight B747-800f at a time. Upon completion, the carrier expects that “uplifting capability will be equivalent to the cargo terminals at Amsterdam Schiphol, Singapore Changi or Hong Kong.”
APM received inaugural container train from RCT APM Terminals, Pipavav received the inaugural container train from Rail Container Terminal (RCT), Vadodara carrying glass materials, syringes, led bulb, flexible intermediate bulk container jumbo bags, etc. for export. Operated by CONCOR, the inaugural trip of the container train service was welcomed by officials from Railways, CONCOR, APM Terminals and Liners. Vadodara is the trade centre of western India having industries like Petrochemicals, Engineering, Chemicals, Pharmaceuticals, Plastics, IT and Foreign exchange services amongst others. It is also an important terminal for the Indian railways connecting Vadodara city with North, South and Eastern regions of the country.
BlackBuck closes $70M to digitize logistics across India BlackBuck, a startup that is digitizing logistics and cross-country freighting in India, has closed out a $70M Series C round. The deal is led by new investor Sands Capital, with participation from World Bank’s IFC and existing investors Accel and Flipkart. BlackBuck had previously raised $30M, including a $20M Series B in 2015. Yuri Milner-backed Apoletto is another investor. The premise of BlackBuck is to bring increased efficiency and transparency to logistics in India through the use of technology. It isn’t alone, however. Its closest rival is Rivigo, which has taken on $115 million in financing from investors such as Warburg Pincus and SAIF Partners, according to Crunchbase.
april 2017 - CargoConnect 87
news
Airforwarders press Trump for new TSA admin
Increased UAV accidents prompt new restrictions
The efficient and safe movement of air cargo hinges on President Trump’s timely nomination of a new head of the Transportation Security Administration (TSA), the Airforwarders Association (AfA) said, stating that “political leadership of agency is essential to air transportation safety.” The White House has, so far, failed to confirm a new administrator, following the retirement of Peter Neffinger, who left with the Obama administration. Air Carrier Standard Security Program (IACSSP) The AfA praised the work of the agency’s interim leadership and staff, but warned that the TSA’s operations and policies have a broad impact on its members. Representing more than 300 companies that move air cargo through the supply chain, the AfA noted that the ongoing vacancy could disrupt operations and compromise economic growth. “Knowing the way things work in Washington, it is important that TSA is under the direction of someone who has been officially endorsed by both the President and the Congress,” said Brandon Fried, the AfA’s executive director.
Flying unmanned aerial vehicles (UAVs) just got a little harder in the Great White North. The Canadian government has instituted new temporary, on year rules that prevent the use of recreational drones near airports, garnering praise from private- and publicsector stakeholders in the air transport business. In addition to clearly marking their devices, drone operators in Canada are now forbidden from flying higher than 90 meters, within 75 meters of buildings and “within 9 kilometers of the center of any airport, heliport, aerodrome or water aerodrome, where aircraft take off and land.” “Canadians expect to feel safe on the ground and in the sky,” Transport Canada stated. The transportation oversight body added that the number of incidents involving recreational UAVs has more than tripled since 2014.
Russia, Thailand look to strengthen transport, logistics links Russian Minister of Transport Maxim Sokolov will visit Thailand on March 2426 to meet Thai Minister of Transport Arkhom Termpittayapaisith. There is no official information about the ministerial meeting’s agenda, but the talks are likely to focus on tourism and business logistics. Despite Thailand being one of the most popular travel destinations for Russians, the countries have only one civil aviation agreement, which was signed in 1996. Russia-Thailand relations have been on the rise since the first meetingbetween prime ministers Dmitry Medvedev and Prayuth Chan-ocha at a summit in Myanmar in November 2014. Ties intensified in 2016 in the run-up to the 120th anniversary of the establishment of diplomatic relations, which is being celebrated this year.
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Hong Kong cargo boost in February Hong Kong International Airport (HKIA) experienced strong cargo growth in February, with a sharp year-on-year increase of 14.1 per cent to 294,000 tonnes. In the first two months of 2017, HKIA recorded a 7.7 per cent increase to 666,000 tonnes from the same period of last year. An HKIA spokesperson said: “The combined robust growth in cargo throughput in the first two months of 2017 was mainly attributable to an 11 per cent year-on-year increase in transhipments. “Exports also recorded an 8 per cent growth. Among the key trading regions, traffic to and from North America, Europe and Southeast Asia showed the most significant increases.”
China to spend $15bn on roads to Russia in 2017 China will invest 101 billion yuan ($15 billion) in the construction of new roads in its Inner Mongolia Autonomous Region to boost transport connectivity with Russia, TASS reported on March 20. “20,000 kilometers (km) of roads will be built in 2017, of which 3,000 km will be high-speed,” an official from Inner Mongolia told the news agency. He added that the authorities are planning to extend the roads to the Russian border to boost trade in the region and encourage Chinese tourists to visit eastern Siberia. The volume of trade between Russia and China is growing and demands strategic investments and the development of infrastructure, the official told TASS.
PROFILE
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DCCAA hosts 8th FFFAI EC Meeting in Delhi Delhi Customs Clearing Agents’ Association (DCCAA) hosted the 8th Executive Committee Meeting for the term 2015-17 on March 10 and 11 at the Aero City in New Delhi. The meeting was attended by Samir Shah, Chairman; Ashish Pednekar, Chairman Elect; Debashish Dutta, Immediate Past Chairman; Amit Kamat, Honorary Secretary; Vinod Sharma, Honorary Treasurer; majority of Vice Chairmen and Executive Committee Members of FFFAI. The participants of the EC Meeting discussed on 19 points related to the Federation’s activities, policies and industry issues. Sunil Kumar, Joint Secretary, Ministry of Commerce, Government of India attended the EC Meeting as a Special Guest to speak on the ministry’s recent initiatives especially on International North South Transport Corridor (INSTC) route in collaboration
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with FFFAI. At this meet, he unveiled that to commemorate the 70th anniversary of the establishment of diplomatic relations between India and Russia the Prime Minister of India, Narendra Modi, on April 13, 2017 would flag off the first containerised shipment on INSTC route. Kumar commended FFFAI’s initiatives to enhance bi-lateral trade from India, especially on INSTC route. He also informed that the Ministry of Commerce had advised all Export Promotion Councils to collaborate with FFFAI for doing business on INSTC route. At this meeting presentations were also given by Ashu Dalmia and Vinit Shetty on GST and Logistics Technology respectively. At the dinner on this occasion several guests from Delhi Airport and logistics companies were present to interact with FFFAI members.
events
A Truckload of Achievements The Mahindra Transport Excellence Awards held on 3rd February at Hotel Ashoka in the Capital saw experts debate about the importance of road safety in a panel discussion titled ‘Innovations in Road SafetyProcesses, Measures and Perspectives’. Moderated by Professor G Raghuram from the Public Systems Group at IIM-Ahmedabad, the discussion went through various points like the flaws in road engineering to trauma care post accidents. The discussion kicked off with Prof Raghuram enumerating the various causes of fatalities on the road. He said, the maximum number of road related deaths in the world happens in India. At 41 per cent, over speeding is the primary cause while overtaking and careless driving account for 32 per cent of road deaths. Fog concerns 4 per cent of such fatalities. “One would imagine drug and alcohol to be major culprits, but they account for only 3 per cent of road-related deaths. Similarly, vehicle defects account for 3 per
cent, and you know, there is a tail of other causes,” said Prof Raghuram. Next up, Prerna Arora Singh, Road Safety Expert, Advocate and Educationist who spoke about the relevance of basic rules on the road. The discussion steered towards road engineering and how it was the cause for accidents. Ravi Prasad, Chief Engineer – Road Safety, MoRTH, spoke about the three Es-Education, Energy and Engineering, which were vital in preventing accidents from occurring. Lady Truck Driver Yogita Raghuvanshi stressed on the flaws in the system which hinder the progress towards safe roads. Jai Prakash Singh gave the panel an insight into his experience as a truck driver. “Constant vigilance is key. Safety comes first all the time, and drivers should train themselves to be alert on the road,” he said. Dr Tamarish Kole, Chair, Academic Council, Society for Emergency Medicine and Advisor – Savelife Foundation, led the point about post-accident issues and trauma care.
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BACC organised Annual Ball 2016 Bangalore Air Cargo Club recently organised its Annual Ball 2016 Event on March 11, 2017 at Royal Orchid Resort, Bangalore. The event was graced by top professionals from the Air Cargo industry and was heavily applauded by them. The function was inaugurated by Hari Singh, Harish Shah, Newton Michael, Parswanath Jain, Rex D and others. Top sponsors of the event were Agility Packers and Movers, Boston Matrix and Instavans.
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ACCD Speaker Lunch held at Radisson Blu Air Cargo Club of Delhi held its Speaker Lunch on March 1, 2017 at Radisson Blu Hotel, New Delhi. The occasion was graced by the very talented Arijit Mukherjee, Associate Director at Anand Rathi Securities. His presentation on Wealth Management was very informative and was well applauded by all the members.
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CWC Celebrated its Foundation Day
Viracopos defines new incentive program for cargo planes Aiming at strengthening the Viracopos International Airport as an international cargo hub, the Brazil Viracopos Airport Concessionaire has created a new incentive program to increase the number of international flight routes and/or cargo frequency. Some incentives allow the exemption of up to 100 per cent of the landing costs. “The new program offers attractive, transparent and nondiscriminatory incentives and with them, the airport will further strengthen its positions as the largest cargo airport in Brazil. At Viracopos the airlines are always treated fairly and with equality, generating business opportunities”, said Viracopos Commercial Director, Jorge Lobarinhas. Companies already operating flights in Viracopos, or that intend to do so, may benefit, provided that they meet the eligibility requirements in a cumulative manner.
Central Warehousing Corporation celebrated its 61st Foundation Day on March, 2017. On this occasion, Shri Ram Vilas Paswan, Hon’ble Minister of Consumer Affairs, Food and Public Distribution was the Chief Guest and Shri C.R.Chaudhry, Hon’ble Minister of State for Consumer Affairs, Food and Public Distribution;Smt. Preeti Sudan, Secretary (Food and Public Distribution); Shri Yogender Tripathi, Chairman, Shri Harpreet Singh, Managing Director; Shri V.R.Gupta, Director (Finance); Shri J.S.Kaushal, Director (Personnel) and Shri S.C.Mudgerikar, Director (M&CP) were present. Hon’ble Minister Shri Ram Vilas Paswan expressed that Corporation will achieve greater heights in future. Hon’ble Minister of State also gave suggestions for future strategy of the Corporation.
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Apollo Logisolutions Limited signs another MoU with Singamas, a subsidiary of PIL Apollo LogiSolutions Limited (ALS) and Singamas, a subsidiary of Pacific International Lines (Pte) Ltd (PIL) signed the Memorandum of Understanding (MoUs) to jointly pursue cold chain logistics in India through a Joint Venture Company (JVCo). This MoU aims to provide cold chain logistics solutions, temperature controlled space/warehouses and temperature controlled transportation and distribution services. Last year, ALS had signed two MoUs with PIL Group of companies. The first MoUs between ALS and PIL which facilitatesmutual cooperation in container freight stations (CFS) and allied services. While the second MoU between ALS and Singamas (subsidiary of PIL) to jointly pursue transportation of specialized liquids in India. This third MoU for Cold chain logistics further underlines the long term relationship both groups enjoy together.
Elaborating upon the partnership with PIL and Singamas, Raaja Kanwar, Managing Director, ALS, said, “ALS is one of the few organized logistics players in India which assures quality and service delivery to its partners. Our strengths are our recognizable brand name associated with a vast footprint world over. Joining hands with PIL and Singamas will ensure that we bring a value proposition to our customers like none other.” On the occasion, Teo Siong Seng, Managing Director of PIL added, “Tying up with ALS, a comprehensive logistics solutions provider, can enhance our interests in an ever growing market with an untapped potential like India. We share a similar outlook and business ethos with ALS. This partnership will help us to diversify and build on our core business of shipping lines and other allied logistics services.”
Panasonic showcases Connected Solutions for a Smarter Living
Panasonic India, the renowned leader of consumer electronics, showcased its innovative range of Connected Solutions that will help make a meaningful difference to consumers’ lives. The company showcased its futuristic technologies ranging from City Surveillance to Boardroom solutions from 3D-Mapping to Retail solutions,
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Education to Property management solutions amongst many. Distinguished range of products and services such as security cameras, feature, HD video conferencing solution, Rugged notebooks–Toughbooks, Video Door Phones, Telephones and PBX were some of the highlights exhibited at the Tradeshow. Aimed at offering a smart and connected lifestyle for enterprise, SMBs and SOHOs alike these products have been widely acknowledged and extensively used across public and private institutions. “Amidst the present digital paradigm
connected solutions define the way we function. Whether it is a regular office operation or a home solution staying connected through our smartphone or tablets has become a part of today’s lifestyle,” said, Manish Sharma, President and CEO, Panasonic India and South-Asia. Sharma further added “Panasonic has always strived for smarter lives, and with an increased impetus on enterprise offerings we are taking another step forward to enhance and revolutionize consumers’ lives through our diverse range of connected products and services.”
events
FFFAI Chairman attends WCO’s Trade Facilitation Agreement Meet
Lufthansa Cargo Cool Center expansions have begun
For the first time in the World Customs Organisation’s (WCO) history, an industry association from India was invited to its meeting, which was held recently on WTO Trade Facilitation Agreement (TFA), in Brussels, Belgium. WCO invited Mr Samir Shah, Chairman, Federation of Freight Forwarders’ Associations in India (FFFAI) to this meet to exchange ideas on TFA and initiatives taken by the industry stakeholders in this country. Speaking at the WCO meet, Shah maintained that the ongoing initiatives on Trade Facilitation under WTO Trade Facilitation Agreement would change the landscape of exim industry as well as Customs Broking/Freight Forwarding business across the globe with its very positive impact on Indian foreign trade. According to him, thanks to new developments/elements in TFA, customs broking business would see a paradigm shift in the days to come. The FFFAI Chairman suggested that both Customs Brokers and Exporters/Importers have to change their mindset and adopt new changes to face the future challenges for their survival and growth.
Lufthansa Cargo has kicked off the development of the Cool Center at the Frankfurt hub. “We’ve gained a great deal of experience in the wo rld wi d e transport of sensitive medications. CEIV certification from IATA has recently highlighted this. The excellent collaboration with numerous shippers from the pharmaceutical and chemical industries has prompted demand for our service to grow consistently,“ said Board Member Operations Sören Stark, in the course of the ground-breaking ceremony. Following completion, as of late summer of this year, 8,000 square meters will be available for cool chain cargo. After the extension, the entire infrastructure of the Lufthansa Cargo Cool Center will be further improved. It was opened in December 2011 and currently offers 4,500 square meters in four different temperature-controlled chiller rooms as well as a deep-freeze room and direct access to the apron.
Senior Delegation from HAROPA Ports visits JNPT
Senior delegation from COSCO Shipping Lines visits JNPT
Herve Martel, CEO-Port of Le Havre and President-HAROPA Ports visited JNPT along with his delegation team including Herve CornedeDirector, Commercial and Marketing, HAROPA Ports, Laurence Coredo, Director-French Customs and Jean Edouard Nicolet, Vice PresidentSOGET. The delegation was received by Anil Diggikar, Chairman, JNPT, Neeraj Bansal, Dy.Chairman, JNPT and other senior Port Officials. The delegation was taken around for a Port tour to showcase JNPT’s Infrastructural facilities, Port operations and future development plans. In the meeting held with senior Port officials, existing infrastructural facilities and future expansion plans like development of Satellite Port, two Dry Ports, Port based SEZ and the ongoing development of the Fourth Container Terminal were highlighted. While welcoming Martel and his team on the maiden visit to JNPT, Neeraj Bansal, Dy.Chairman, JNPT congratulated them for being the No. 1 Port in ‘Ease of Doing Business’. Bansal addressed that JNPT looks forward to have a synergy between the two Ports for sharing best business practices for the overall growth of the maritime sector.
Senior delegation from COSCO Shipping Lines, Shanghai headed by Zhu Jiandong, Director, COSCO Shipping lines visited JNPort on 23rd Feb to see the Port operations and to discuss various emerging business opportunities with the JNPT management. The delegation consisted of officials from their corporate office in Shanghai, regional office in Singapore and Capt S.K.Chugh, CEOCosco Shipping Lines (India) pvt Ltd. Neeraj Bansal, Deputy Chairman and senior officials of JNPT welcomed Zhu Jiandong and his delegation team to showcase the current developments and future plans and projects of the Port in a meeting held at Sheva, Navi Mumbai. COSCO Shipping line is the fourth largest container line in the world and they already have services to key destinations from JNPort. They made a brief presentation of their fleet to the JNPT team and they showed keen interest in adding additional services to the Port.
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Emirates SkyCargo sees blooming flower transport business from India in 2017
New cargo statistics from Emirates Skycargo show a growth in the export of flowers from major Indian hubs this year. While the airline uplifted more than 550 tonnes of flowers in 2016 (Jan –Dec) from India, it has already recorded an uplift of more than 200 tonnes this year. The carrier attributes this marked increase to the pre-Valentine day rush. Unsurprisingly, roses were the most uplifted flowers from across its hubs in India. Apart from roses, this year also saw a rise in number on the export of other exotic flowers
like Jasmine, Orchids and Carnations from hubs like Bangalore and Mumbai. Flowers are exported from India not only for demand around Valentine’s Day, Mothers’ Day and other similar events but also for religious purposes like garlands for temples outside India. The transportation of flowers by the air cargo carrier is a year-round activity from its hubs such as Bangalore, Mumbai, Chennai and Kolkata. This year, Bangalore and Mumbai already witnessed a record uplift of close to 150 and 80 tonnes, respectively, in just the first two months of the year. Speaking on the flower uplift, Keki Patel, Cargo Manager (India & Nepal) at Emirates SkyCargo, said, “Many regions in India have the ideal climate for cultivating flowers all year round, offering excellent growing conditions. We have witnessed a surge in flower demand this year from destinations like Europe who have experienced a harsh winter this year. We have reported strong volumes of flower
transport in the weeks leading up to Valentine’s Day this year which will play a substantial part in the total yearly volume recorded for 2017.” Sophisticated logistics by Emirates SkyCargo ensures quick and reliable air transport of these delicate goods to destinations across its global network. State of the art equipment and facilities help avoid the wilting of flowers. Roses are hand harvested and then sorted, arranged in bouquets and hand-packed into boxes, which are then loaded on the aircraft.
Logistics & Supply Chain Summit held at PHD House, New Delhi The Committee on Logistics Management of PHD Chamber of Commerce and Industry organised an another successful event titled “Logistics & Supply Chain Summit” on March 21, 2017 at PHD House, New Delhi which was attended by more than 120 delegates from industry and other stakeholders. V. Kalyana Rama, CMD, CONCOR, who was the Chief Guest at the summit in his Inaugural address laid stress on the fact that
implementation of GST and the upcoming DFC (Dedicated Freight Corridor) will bring forth numerous opportunities for each one of us in the Logistics Sector to capitalize upon. During his address he said that another important aspect which should be factored into each of our business strategies is to graduate from ‘Customer Satisfaction’ to ‘Customer Value Creation’. This can be achieved by providing Single Window solutions, Continuous Cargo Visibility and Guaranteed
while the GDP is growing at 7 per cent plus, logistics sector is still growing at only about 2-3 per cent. This is primarily due to the large scale growth of the Service sector, which does not result in a high growth in the Logistics sector. He also informed the participants that the recent government’s initiatives: like Make in India, Pradhan Mantri Garib Kalyan Yojana (PMGKY) are very important steps in the growth of the primary sectors, which will have an overall positive impact on the growth of the Logistics sector. This coupled with the
Services Levels, leveraging the use of IT to achieve all these objectives an important tool. Anil Khaitan, Senior Vice President, PHD Chamber in his welcome address said that designing an optimal supply chain configuration that can meet the expected growth rates is a challenging task, especially in India. While customers demand improvements in each aspect at everlower prices, producers and distributors in India are facing increasing competition in nearly every product category.
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appointments
American Airlines Makes Executive Appointments American Airlines recently shared retirements of two admired team members, Tim Ahern, Vice President – Customer Experience and Terri Pope, Vice President – Charlotte Hub Operations. Concurrent with this announcement, several additional appointments were made to backfill open positions. Dec Lee Rick Elieson will succeed Pope as Vice President – Charlotte Hub Operations. John Beavers has been promoted to Vice President – Engineering, Quality and Training, to assume Lee’s previous role. JonCarlo Gulbranson has been promoted to Vice President – Reservations, a position previously open. Rick Elieson has been promoted to President – American Airlines Cargo, a position that was previously open. “It is always difficult to see respected team members depart, but Terri and Tim have worked hard for the people of American and deserve our deepest appreciation as they begin their retirement chapters,” said American’s President Robert Isom. “Thanks to thoughtful succession planning, we have talented leaders at the ready to step into these important positions and continue to build on the foundation that is in place. The future is exciting with these leaders at the helm, and we look forward to their contributions.” Tim Ahern, Vice President – Customer Experience, informed the company of his plans to retire at the end of April. “Tim has been a key leader at American Airlines for almost 40 years, and has helped our team succeed through incredible changes and challenges,” said Isom. “He is known as a mentor to many, and his big heart, laughter and care for colleagues will truly be missed.”
Lufthansa Cargo Supervisory Board extends contract of Board Member Dr Alexis von Hoensbroech has been appointed Board Member Products & Sales of Lufthansa Cargo AG for a further five years. The company’s Supervisory Board extended his contract early and unanimously until 30 November, 2022. As part of corporate-wide restructuring, Alexis von Hoensbroech von Hoensbroech had re-positioned his department at the start of the year to increase efficiency and ensure even greater flexibility and closer customer relations. Von Hoensbroech has been working for the Group since 2005 and has been a member of the Board of Lufthansa Cargo AG since December 2014. The 46 year-old was previously Commercial Manager Frankfurt of Lufthansa Passage and was responsible there for network planning, booking control and commercial management of the passenger business at the airline’s largest hub.
upcoming events Economic Times Global Logistics Show on April 17-19, 2017 at the Bombay Exhibition Centre in Mumbai organised by Infinity Expo Media Company
ChemLogistics India on April 25-26, 2017 at the Bombay Exhibition Centre in organised by Mack Brooks Exhibitions Ltd and Koelnmesse YA Tradefair Pvt Ltd
India Integrated Transport & Logistics Summit 2017 on May 3-5, 2017 at Vigyan Bhawan, New Delhi organised by MoRTH, NHAI, CII and FICCI
2nd Commercial Vehicle Forum on May 18, 2017 at Westin Pune organised by Threefold Business Solutions Pvt Ltd
Cold Chain Strategy Summit on June 21, 2017 at The Westin Garden City, Mumbai organised by KamiKaze B2B Media
5th LOGMAT on June 22-24, 2017 organized by Smart Expos & Fairs (India) Pvt Ltd at Chennai Trade Centre, Chennai
7th India Warehousing Show on July 27-29, 2017 at Pragati Maidan organised by Reed Manch Exhibitions
11th Express Logistics & Supply Chain Conclave on October 4-5, 2017 at Taj Lands End, Mumbai organised by KamiKaze B2B Media
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PEOPLE CONNECT
Respect and affection of your peers defines success Samir J Shah, Owner, JBS Group of Companies has the experience spanning over more than 30 years in the field of Logistics and Forwarding solutions. He believes that with the ever -growing population and high demand of accurate and efficient manpower the industry will flourish to a great extent. Apart from the work, Shah has also shared his success mantra and values by which the companies of JBS group operate in an exclusive interview with Gaurav Dubey.
What motivated you to be a part of the logistics industry and how has the experience been so far? My father, J.B. Shah was into Customs Clearance since before my birth. The company undertook freight forwarding also with the passage of time. All this happened much before I finished my studies and for me joining JBS was a foregone conclusion during my growing up years. When I look back to my journey so far I found logistics very dynamic and exciting. In the past around 32 years there have metamorphic changes that have taken place in the industry. They have all been very enriching educative and interesting. I have never regretted being here.
How the industry has changed from the time you stepped in? What major transformations have you observed in the industry in terms of technology, manpower, practices, government regulation, etc? Domain knowledge; integrity; personal relationship and ability were the main drivers till around 7-8 years back. Pricing and financing ability have replaced all these. This has been the biggest transformation. Use of technology is only a means of executing the work and introduction of the same in the logistic sector is natural since every industrial
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segment has adopted tech nolog y. Howe ve r, t e c h nolo g y h a s m ad e information and data easily accessible to everyone, which has changed the way the industry work. More importantly it has changed the way the users look out for services. The government moving into a trust regime; reducing processes and discretionary powers has resulted in diluted requirements of domain knowledge for routine activities.
introduction of new projects will ensure that the logistic industry becomes more vibrant and there will be great increases in the volumes to be handled. It is important that the logistic industry recognises this and work towards ensuring that they can leverage these increases to their advantage profitably.
Which is the biggest challenge that you have faced till date?
Success is an inspiration and failure is an experience coupled with the thought that every activity undertaken should be to my satisfaction and not be driven by client consideration has been the major belief. The respect, affection and expectations of your peers towards you are a sign of success. Success is a responsibility and one needs to be conscious; careful and concerned about the same.
The way the Indian Customs Brokers have been working over the past many years was very much dependent on multiple regulations; complicated processes and relationship. With the removal of multiple processes and complexities etc. role of the logistic service provider will undergo a sea change. The ability to adopt change will be the biggest challenge. Over the past three decades there have been numerous challenges and changes with one had to face and listing out a single one is difficult.
What specific beliefs or values do you live by? How do you define success?
Apart from work, what are your other interests? I spend time with my family, pets and meet people in my leisure time.
Where do you see the graph of the logistics industry will head in the coming years?
What message would you give to the aspirants who want to make a mark in the logistics industry?
The increase in population; increasing desires and aspirations of the people for material needs; innovation and
There is no shortcut to success. One needs to be consistently prepared for learning continuously.
A Trusted Name in the Domain of Logistics for More Than a Decade The EXTRA EDGE • • • • • • • • • • • • • • • • • • •
Certified weigh bridge within premises, for SOLAS (VGM) compliance. Scheduled rail service between ACTL & Nhava Sheva/Mundra/Pipavav Dedicated Railway Siding equipped to handle EXIM as well as Domestic Cargo. State of the art infrastructure for reefers containers with plug in points andpower packs. Shortest Transit Time from NCR to Nhava Sheva. QC facility within Bonded Area. Special dust free enclosure for GOH in the export warehouse with provision of temperature control. CTPAT Compliant and AEO Certified. Bonding of Import Cargo in warehouse as well as containers. Provision of clearing and consolidating air cargo. Security: CCTV surveillance, intruder alarms and motion sensors. Online tracking of shipments. Value adds like Palletisation, shrink wrapping, Sorting, Segregation, Snakeloading, Bar coding, etc. All equipment owned and operated by ACTL. EDI, Bank, Dedicated Customs teams. Customized daily reports for customers via email. Impeccable cargo handling. Provision for customs clearance on Sundays/holidays. Door-to-Door delivery/handling of cargo.
Terminal
: ICD, Sector 59, Faridabad, Haryana, Phone: 0129-4259300 Fax: 0129-4259311, E-mail: info@actlindia.com Corp. Office: M-26, Main Market, Greater Kailash–II, New Delhi–110 048. Phone: 011-49488900/ 901, Fax: 011-49488910, E-mail: info@actlindia.com Mumbai : 16 Friends Society, 227 P.D'Mello Road, Fort, Mumbai 400001. Phone: 022-22616170, E-mail: mumops@actlindia.com, E-mail: www.actlindia.com
PROUD TO DEDICATE JAIGARH PORT IN THE SERVICE OF THE NATION
On 25th March’2017, Our maritime jewel ‘JSW Jaigarh Port’ has received and serviced bulk cargo ship “MV China Enterprise” carrying over 2,00,000 MT of coking coal from Australia at its modern mechanized berth using environment friendly material handling systems. This is the largest dry bulk parcel ever serviced by an Indian port. The port is poised to handle 4,00,000 MT iron ore vessels (Valemax) and 3,40,000 MT crude oil carrier (VLCC). LNG vessel (Q Max) alongside berth in the immediate next phase. JSW is committed towards developing world class maritime infrastructure in India.
The day was marked with: • Laying of Foundation Stone for the Jaigarh-Digni Railway Line • Inauguration of a 42-km Enhanced Road Connectivity between Jaigarh Port & Nivali • Inauguration of Mechanised Coastal Berth 6A
HEARTIEST THANKS TO OUR ESTEEMED GUESTS FOR GRACING THE OCCASION:
Shri Devendra Fadnavis
Shri Nitin Gadkari
Shri Suresh Prabhu
Shri Anant Geete
Hon’ble Chief Minister, Maharashtra
Hon’ble Minister of Road Transport & Highways and Shipping, GOI
Hon’ble Minister for Railways, GOI
Hon’ble Minister of Heavy Industries & Public Enterprises, GOI
Shri Ravindra Chavan
Shri Vinayak Raut
Shri Uday Samant
Hon’ble Minister for Ports, GOM
Member of Parliament Ratnagiri- Sindhudurg
Member of Legislative Assembly, Ratnagiri