Inside Logistics November/December 2023

DECEMBER 2023

C A N A DA’ S S U P P LY C H A I N M AG A Z I N E

NOW INCLUDING:

Canadian Shipper

CHANGING LANES Canadian Tire’s Gary Fast is Supply Chain Executive of the Year

› Order fulfillment › Racking foundations

Publication mail agreement #43734062

› Canada’s forced labour law

Turnkey Media Solutions Inc. 48 Lumsden Crescent, Whitby, Ontario, Canada L1R 1G5

INSIDELOGISTICS.CA 01_IL_Dec23_cover.indd 1

2023-11-27 7:00:16 PM

YOUR TICKET TO

FIRST

CLASS

• Award-winning LTL with daily scheduled CAN & USA departures

• Total security compliance as a CAN & USA customs bonded carrier

• Priority PlusTM overnight service between Toronto & select USA cities

• Express border clearance via intelligent customs document processing

• Remote and cabin crew prioritizing safety & comfort

• Real-time tracking, automated updates & instant notifications

• Piloted by experts ensuring minimal turbulence in transit

• Luxury customer experience with online ordering, shipping tools & 24/7 support

0.19%

C L AI MS RATI O

#CrossBorderPros

03_IL_Dec23_Contents.indd 2

0%

OOS RAT E

1.800.409.2269

2023-11-27 7:01:45 PM

NOW INCORPORATING

CANADIAN SHIPPER

C A N A DA’ S S U P P LY C H A I N M AG A Z I N E D E C E MB E R 2 0 23 • V O LU M E 6 8 • NU M B ER 0 6

20

CONTENTS In every issue:

5 Taking Stock

The cost of resilience

6 Supply Chain Scan

Strong foundations How the right racking readies the warehouse for automation

News and numbers from around the world

11 Movers + Shakers

Appointments and promotions

27 Real-time Visibility Hwy H2O

28 Operations outlook

Inflation and supply chains

29 Trade Update What’s in store for ‘24

30 Safety First

Keeping safety top of mind

ON THE COVER | PAGE 14

6

SUPPLY CHAIN SCAN

Canadian cold chain | Commercial rents ease | Calling out Driver Inc. fraud

19

cover image: supplied by Gary Fast

image: biancoblue/freepik

image: jcomp/freepik

19

24

26

New tools to optimize fulfillment

03_IL_Dec23_Contents.indd 3

26

image: vecstock/freepik

Order fulfillment

insidelogistics.ca

24

Inventory in the C-suite

Why senior management should control strategy

Guest Editorial

Getting ready for Bill S-211

3

2023-11-27 7:01:47 PM

1 (877) 557-2257 3DSTORAGESOLUTIONS.COM

3D STORAGE

SOLUTIONS

L I M I T E D

PALLET RACKING DRIVE-IN PUSHBACK 05_IL_Dec23_Editorial.indd 4

Listen Plan Design Integrate MEZZANINES PALLET FLOW CANTILEVER CARTON FLOW SHELVING 2023-11-27 7:03:14 PM

G

TA K I N G S T O C K

Publisher | Delon Rashid

(416) 459-0063 delon@turnkey.media Editor | Emily Atkins

(416) 262-4106 emily@turnkey.media Contributing Writers | Matthew Bardell, Victoria

Jones, Norm Kramer, Keith Moore, Hamish Morgan, Rejean Provst, Christian Sivière, Del Williams Creative Director | Samantha Jackson Video / Audio Engineer | Ashley Mikalauskas,

Nicholas Paddison Sales | Delon Rashid, (416) 459-0063 delon@turnkey.media

The cost of resilience “BUILD A RESILIENT SUPPLY CHAIN.”

Peter Bulmer, (585) 653-6768 peter@turnkey.media Production and Ad-ops |

Tracy Stone tracy@turnkey.media

Inside Logistics magazine is published by Turnkey Media Solutions Inc. All rights reserved. Printed in Canada. The contents of this publication may not be reproduced or transmitted in any form, either in part or full, including photocopying and recording, without the written consent of the copyright owner. Nor may any part of this publication be stored in a retrieval system of any nature without prior consent.

Canada Post Canadian Publications Mail Sales Product Agreement No. 43734062 “Return Postage Guaranteed” Send change of address notices, undeliverable copies and subscription orders to: Circulation Dept., Inside Logistics magazine, 48 Lumsden Crescent, Whitby, ON, L1R 1G5

Inside Logistics magazine (ISSN No.: 0025-5343 (Print); 1929-6460 (Digital) is published six times per year by Turnkey Media Solutions Inc., 48 Lumsden Crescent, Whitby, ON, L1R 1G5 From time to time we make our subscription list available to select companies and organizations whose product or service may interest you. If you do not wish your contact information to be made available, please contact us.

President & Managing Partner | Delon Rashid Head of Sales & Managing Partner | Peter Bulmer Corporate Office

That advice is frequently offered, especially in the post-pandemic world we are experiencing, where uncertainty, conflict and supply chain chaos have become the norm.

In this issue, for example, we have a guest editorial that explains why inventory strategy should be a much higher priority than many companies make it. The argument, penned by nVentic’s Matthew Bardell, suggests inventory levels have for too long been simply a byproduct of other corporate activities, but should be a c-suite concern, so that externalities beyond the corporation’s control can be managed.

Guidance abounds on the best way to ensure your supply chain can withstand the shocks and risks of the contemporary world. Conservative inventory strategies – keeping safety stock where once it was just-in-time – and diversifying sourcing to multiple vendors, are just two of the commonly recommended strategies that may prevent shocks such as we saw during the pandemic’s chaos.

But recent research shows that with the current economic uncertainty gripping markets for durables and essentials alike thanks to recession fears and inflationary pricing, many enterprises are choosing to use technological solutions that come at less cost. Inventories are being scaled back again, while the number of suppliers being used by major US importers is back to 2019 levels.

“Global supply chains won’t have any respite from a decade of disruptions in 2024, making resilience-building more vital than ever. However, falling profitability and rising interest rates have meant costly just-in-case inventory strategies and multi-sourcing approaches are not in favour, though reshoring is. The good news is that technology investments and organizational enhancements can help build resilience,” said Chris Rogers, head of supply chain research at S&P Global Market Intelligence, which published the research report.

It’s interesting that in response to fiscal pressures companies are reverting to supply chain strategies that were deemed too risky just three years ago.

But keeping inventory in an uncertain market and at high interest rates is a risk unto itself, and one that is quite unpalatable at present.

Under the circumstances, what is your organization doing to avoid risk as we enter 2024? Please share your plans. I can be reached at emily@ turnkey.media

48 Lumsden Crescent, Whitby, ON, L1R 1G5

ISSN 0025-5343 Online 1929-6460

insidelogistics.ca

05_IL_Dec23_Editorial.indd 5

WHY THE C-SUITE SHOULD PAY MORE ATTENTION TO INVENTORY STRATEGY – PAGE 24.

5

2023-11-27 7:03:14 PM

S U P PLY C H A I N S C A N |

New spaces boost Canada’s cold chain capabilities

MOVERS + SHAKERS

Appointments and promotions

11

VACANCY CLIMBS

Commercial real estate becomes more affordable

12

DRIVER INC CRACKDOWN CTA encourages exposing fraud

13

6

06-13_IL_Dec23_News.indd 6

Michel Robert, president and CEO of Groupe Robert opens the new facility in Varennes

By Emily Atkins Groupe Robert and Lineage Logistics are making significant additions to Canada’s cold chain infrastructure.

Groupe Robert recently opened its automated distribution centre in Varennes, Quebec.

Located near Highway 30, about 25 km northeast of Montreal, the large vertical capacity distribution centre will boast a height of 131 feet and will have storage capacity for 60,000 pallets, 30,000 for fresh products and 30,000 for frozen products.

The building is a 14-storey freestanding structure, built with high-precision parts manufactured in Austria by Voestalpine. The storage shelves for pallets, integral to the project, serve as the building's supporting structure. It was pre-assembled in Quebec's Saguenay region before being erected in Varennes.

Dematic provided automation solution encom-

“This new state-of-the-art distribution centre, that brings together the best proven technologies in the industry, demonstrates Groupe Robert's continued commitment to innovation and excellence for our clients, – Michel Robert, president and CEO of Groupe Robert.

passing everything from the unloading dock to storage management. Their software plays a critical role in this system, autonomously deciding the optimal locations for placing INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:04:09 PM

continued from page 6 | S U P PLY C H A I N S C A N

FOLLOW US! Lineage is adding 30 percent to its capacity in Calgary

“As we continue to expand our presence in Canada, the Calgary market serves as a critical location to meet the demand of existing customers and welcome new customers in need of export capability,” – Ken MacLean, regional VP in Canada for Lineage Logistics.

pallets in the storage racks.

Groupe Robert spent over $200 million to build it, supported by financial contributions from the government of Quebec, Investissement Québec and several partners.

Groupe Robert is the first third-party logistics (3PL) service provider in Quebec with an automated warehouse for fresh and frozen food products, and it's one of the most advanced facilities in North America.

"This new state-of-the-art distribution centre, that brings together the best proven technologies in the industry, demonstrates Groupe Robert's continued commitment to innovation and excellence for our clients," said Michel Robert, president and CEO of Groupe Robert.

Meanwhile, in Calgary, Lineage Logistics has broken ground on an expansion of its Foothills facility in Calgary. It is expected to add 30 percent more capacity, with 1,500 new pallet positions for blast freezing.

Additionally, the site is to include expanded dock space and doors.

Following the completion of the expansion, the facility is expected to span approximately 200,000 square feet, hold over 24,000 pallet positions, bringing Lineage’s total capacity in the Alberta market to over 75,000 pallet positions.

“As we continue to expand our presence in Canada, the Calgary market serves as a critical location to meet the demand of existing customers and welcome new customers in need of export capability," said Ken MacLean, regional VP in Canada for Lineage Logistics.

“As a leading logistics solutions provider, Lineage is excited to break ground on expanding the Foothills facility to better service the needs of the market once completed.”

Lineage acquired Quebec-based Marc Villeneuve Inc. in April 2021, and Ontario Refrigerated Services (ORS) in July 2020. Its 2022 purchase of Versacold cemented its market leading position in the country. insidelogistics.ca

06-13_IL_Dec23_News.indd 7

Need a fresh take on fullfillment automation?

Discover if a regular or double-double is the right blend of conveyor and automation for your business at TREWautomation.com.

7

2023-11-27 7:04:10 PM

Congratulations, CITT-Certified

Logistics Professionals CITT is proud to present the CITT-Certified Logistics Professionals who earned their CCLP designations between November 2022 & October 2023. Congratulations to the more than 120 dedicated supply chain logistics professionals who now join the ranks of the industry’s elite.

Me

Sabika Ali, CCLP Surrey, BC

Laith Almashaek, CCLP Mississauga, ON

Kerwyn Andrews, CCLP Calgary, AB

Sumair Ashraf, CCLP Mississauga, ON

Samantha Barwell, CCLP Richmond Hill, ON

Chaimaa Belfrouh, CCLP Calgary, AB

Luciana Bellino, CCLP Scarborough, ON

Christine Burns, CCLP Hantsport, NS

Nipur Chawla, CCLP Brampton, ON

Shing Chak Choy, CCLP Coquitlam, BC

Paula Cormier, CCLP Mississauga, ON

Lindsay Crawford, CCLP St Thomas, ON

P

Yan Debowski, CCLP Québec, QC

Varun Dogra, CCLP Scarborough, ON

Julie-Anne Dupuis, CCLP Les Cedres, QC

Leroy Ebert, CCLP Mississauga, ON

Mohamad El Zareef, CCLP Chiedozie Ezimora, CCLP Coquitlam, BC Waterdown, ON

O

M Rijaya Rabbi Fahim, CCLP Nicolas Flandez Lopez, CCLP Chris Forsman, CCLP Toronto, ON Vancouver, BC Kindersley, SK

Obi Ikpengwa, CCLP Burnaby, BC

Mithula Jegatheeswaran (Jegan), CCLP Fort Erie, ON

06-13_IL_Dec23_News.indd Newly Certified CCLPs for Inside8 Logistics - 2023 for PRINT.indd 1

Jaeyoung Joo, CCLP Surrey, BC

Sandeep S Ghatora, CCLP Surrey, BC

Dylan Kafka, CCLP Brantford, ON

Jacob Golightly, CCLP Mississauga, ON

Richard Gordon, CCLP Caledon, ON

Amandeep Kaur, CCLP Whitby, ON

Harleen Kaur, CCLP Mississauga, ON

N

2023-11-27 3:28:33 7:04:10PM PM 11/22/2023

Bo

Newly C

s

f

Rick King, CCLP London, ON

Francis Lalonde, CCLP Toronto, ON

Gregory Mann, CCLP Surrey, BC

Janice McDermott, CCLP Saint John, NB

Tricia Melvin, CCLP Saint John, NB

Marcus Monteiro, CCLP Cambridge, ON

Melinda Morben, CCLP Lantzville, BC

Jeffrey Morris, CCLP Mazerolle Settlement, NB

Gugulethu Moyo, CCLP Saint Lazare, QC

Vivian Nwadike, CCLP Scarborough, ON

Christian Offiah, CCLP Cambridge, ON

Iwalola Oladele, CCLP Calgary, AB

Greg Oliver, CCLP Innisfil, ON

Simon Olthof, CCLP Malahat, BC

Michael Peck, CCLP Calgary, AB

Pardeep Rana, CCLP Vancouver, BC

James Rimmer, CCLP Winnipeg, MB

Kim Ross, CCLP Winnipeg, MB

Paolo Rovelo, CCLP Oakville, ON

Redwan Siddiqui, CCLP Oakville, ON

Ashley Son, CCLP Markham, ON

Owen Soriano, CCLP Richmond, BC

Scott Spak, CCLP Winnipeg, MB

Kayleigh Sparrow, CCLP Calgary, AB

Melissa-Ann Teixeira, CCLP Boisbriand, QC

Melvin Thibodeau, CCLP Burnaby, BC

Dmytro Tsurko, CCLP Burlington, ON

Vilius Uloza, CCLP North Vancouver, BC

Partheepan Vasanthan, CCLP North York, ON

Christie Wells, CCLP Mississauga, ON

Boutaïna Yanouri, CCLP Laval, QC

Shahram Yarmand, CCLP Vancouver, BC

King Nga Yeung, CCLP Toronto, ON

P

Ana Perdomo Labrada, CCLP Jean-Luc Perron, CCLP Edmonton, AB Winnipeg, Manitoba

Hai Qiu, CCLP Burnaby, BC

P

P

8:33 PM

Newly Certified CCLPs for Inside Logistics - 2023 for PRINT.indd 2 06-13_IL_Dec23_News.indd 9

Melissa Wiggins, CCLP Chun Wai Victor Wong, CCLP Sarnia, ON Mississauga, ON

Tracey Young, CCLP Saint-Lazare, QC

Sierra Zhang, CCLP Vancouver, BC

Lisa Xu, CCLP Burnaby, BC

Yasmina Zirmi, CCLP Richmond, BC

11/22/2023 3:28:50 PM 2023-11-27 7:04:10 PM

Photos of the following new CITT-Certified Logistics Professionals were not available: Felanie Anderson, CCLP, Vancouver, BC Nivedita Badhan, CCLP, Surrey, BC Vijay Bajwa, CCLP, Ajax, ON Michael Ball, CCLP, Mississauga, ON Samad Bashir Khan, CCLP, Surrey, BC Tetia Bayoro, CCLP, Ottawa, ON Tomasz Bogusz, CCLP, Brampton, ON Stephanie Buchanan, CCLP, Saint John, NB Natalia Cardoso Valadares, CCLP, Toronto, ON Simranjeet Chharahhan, CCLP, Surrey, BC Ryan Coles, CCLP, Mount Albert, ON Chris Cousineau, CCLP, Calgary, AB Anita June Dass, CCLP, Brampton, ON Chris Davis, CCLP, Mississauga, ON Andrew Emanuel, CCLP, Etobicoke, ON Milo Geronimo, CCLP, Richmond, BC Paul Graham, CCLP, Oakville, ON Nicholas Green, CCLP, Edmonton, AB Spencer Ingram, CCLP, Newmarket, ON Kwesi Klass, CCLP, Mississauga, ON Bao Ngoc Le, CCLP, Vancouver, BC Wen Han Li, CCLP, Maple Ridge, BC Yi Le Liu, CCLP, Surrey, BC Kalli McKay, CCLP, Blacks Harbour, NB Yassi Nikkah, CCLP, Vancouver, BC Derek Nunes, CCLP, Milton, ON

Olusola Oladipo, CCLP, Calgary, AB So Yeong Park, CCLP, Burnaby, BC Saneel Patil, CCLP, Airdrie, AB Alexander Paul, CCLP, Vancouver, BC Johana Quiorga Porras, CCLP, Burnaby, BC Emily Ramsay, CCLP, Delta, BC Kimberly Reimer, CCLP, Morden, MB Kirk Robinson, CCLP, Saskatoon, SK Stephen Rutherford, CCLP, Surrey, BC Ghassan Saleh, CCLP, Toronto, ON Abhishek Sharma, CCLP, Calgary, AB Afeez Sobiye, CCLP, Toronto, ON Angela Splinter, CCLP, Ottawa, ON Mark Starnino, CCLP, Vaudreuil-Dorion, QC Christian Steffenhagen, CCLP, Maple Ridge, BC Alvanique Symonette, CCLP, Winnipeg, MB Gloria Tang, CCLP, Airdrie, AB Matthew Teixeira Cortina, CCLP, Blainville, QC Jeremy Toth, CCLP, Strathmore, AB John Trumpy, CCLP, Saskatoon, SK Jennifer Vandermeer, CCLP, Courtice, ON Yanan Xu, CCLP, Burnaby, BC Adam Zuk, CCLP, Richmond Hill, ON

See the list of all current CCLP designation holders at www.citt.ca/community/cclps

Unlock the potential of your career with Canada’s logistics certification – CCLP® For 65 years, elite logistics professionals have set themselves apart with the CCLP designation. Take your first step to join them this winter. Start online January 22

Learn more & take your first step at citt.ca/cclp Newly Certified CCLPs for Inside 06-13_IL_Dec23_News.indd 10 Logistics - 2023 for PRINT.indd 3

11/22/2023 2023-11-27 3:28:56 7:04:11PM PM

8:56 PM

| S U P PLY C H A I N S C A N

movers + shakers The National Motor Freight Traffic Association (NMFTA) has welcomed Lesley Veldstra Killingsworth as the first female chair of its board of directors. Killingsworth, who has been a member of the NMFTA since 2012, is director of traffic and pricing for Mississauga, Ontario-based Polaris Transportation Group. She previously served in the same position with Mountain Valley Express after starting in the industry as an account executive with Worldwide Express.

The CITT Toronto Area Council elected a new executive team for 2023-2024. The following posts were filled. Chair: Denise Ponte, senior account executive, Uber Freight. Vice-Chair: Lisa Vegso, Peco Pallet. Treasurer: Brett Poe, senior pricing manager, Apex Motor Express. Secretary: Bonnie Parkinson, marketing & communications manager, XTL. Project Coordinator: Sheryl Meens, recruitment consultant, SCL Search. Events Coordinator: Lucille Thiele. Executive Advisor: Tom Pauls, managing director, SCL Search Consultants Ltd. Members at large: Grace DiMarca, George Beck, Michael Upwood, Cole Brumwell, Victoria Jones, and Noah Sidenberg.

Gebrüder Weiss has named Lars Nielsen as its

Heidegunde “Heidi” Senger-Weiss died at the age of 82 on October 19, 2023. Together with her husband Paul, she steered the fortunes of Gebrüder Weiss from 1968 to 2004.

From 2005 to 2017 she served

country manager for Canada. Nielsen brings more than 30 years of experience in logistics, procurement, and supply chain operations in Canada to his new position. Nielsen is based at the Toronto office, and is responsible for the branches in Toronto, Montreal, and Vancouver.

insidelogistics.ca

06-13_IL_Dec23_News.indd 11

on the Supervisory Board. She remained closely engaged in Gebrüder Weiss until her death. In 2015, Senger-Weiss was inducted into the Logistics Hall of Fame at the German Ministry of Transport in Berlin, making her the first woman to earn this accolade. She received numerous other awards for her life’s work, most recently the Grand Decoration of Honor for Services to the Republic of Austria in November 2022.

PSA International Pte Ltd announced that Tan Chong Meng will be retiring from his positions as the company’s group CEO and board member on March 1, 2024. Ong Kim Pong, currently the regional CEO of Southeast Asia at PSA International, will assume the mantle of group CEO and be appointed to the PSA international board.

Nelson Quek, managing director of the container business division in PSA Singapore will take over the reins as regional CEO for Southeast Asia. He will also become a member of PSA’s senior management council.

11

2023-11-27 7:04:11 PM

S U P PLY C H A I N S C A N |

Uptick in vacancy rate signals some relief for renters NATIONAL INDUSTRIAL PROPERTY vacancy notched its 4th consecutive

increase, rising to 2.1 percent in the third quarter, according to numbers released by realtor JLL. Rental demand, particularly from large bay users, declined. With a cyclical high in construction deliveries expected over the next 12 months, vacancy is expected to continue its rise through 2024.

However, vacancy is still expected to remain below the long-term historic average.

12

06-13_IL_Dec23_News.indd 12

The Greater Toronto Area (GTA) industrial market saw gradual increases in vacancy rates paired with smaller quarter-over-quarter (QoQ) increases in asking rents. Market vacancy increased to 1.6 percent, the highest rate since Q1 2021.

Average asking rents increased to $18.69, a 15.2 percent increase yearover-year, and a mere 0.80 percent increase over the previous quarter.

Such a marginal increase contrasts with the 5.9 percent increase seen between Q2 and Q3 2022, suggesting the pandemic era of high rental escalations is coming to an end.

Tenants will contend with a tight but gradually balancing market into 2024, JLL predicted.

Newly built space coming available is expected to continue to outpace total absorption as the GTA’s construction pipeline reaches delivery. When paired with decreasing pre-lease rates, GTA tenants can expect increases in vacancy and near negligible increases in average net asking rents.

The Metro Vancouver industrial market showed signs of softening as availability and vacancy went up by 60 basis points (bps) and 30 bps, respectively.

Direct average asking rents decreased for the first time in 11 quarters, as a result of price reductions and listings sitting on the market for extended periods.

Lease rates could come under pressure if availabilities continue to increase at the current rate, JLL said. This will give tenants more options to choose from, balancing out a previously landlordfavoured market. The expectation that the Bank of Canada will hold interest rates for the next few months could fuel optimism on the buyer side and sale prices will continue to fall.

Rents stumbled for the first time since Q3 2020 in Montreal markets, breaking a 12-quarter streak of increases. The contraction signals a weakened appetite for industrial spaces as tenants navigate with caution due to economic uncertainty. Pricing has declined by 40 cents since the previous quarter.

Despite the decrease, asking rates are still 14.6 percent higher than those observed a year ago.

Availability and vacancy rates rose again, bringing long-awaited balance to the market. This quarter, nearly 550,000 square feet of additional sublet space became available, most of which originated from on-island submarkets including the West Island, Midtown North, Saint-Laurent and the East End. Increased market uncertainty has created a much more balanced market than witnessed during the pandemic years. Availability, vacancy, and negative absorption should continue to rise, thus deterring landlords from raising asking rate expectations.

It’s expected that an increasing number of new industrial developments will either be delayed or designated as build to suit.

INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:04:12 PM

| S U P PLY C H A I N S C A N

Trucking Alliance asks members to call out Driver Inc violators TO ASSIST GOVERNMENT departments in com-

batting unscrupulous and illegal behaviour by Driver Inc carriers, the Canadian Trucking Alliance (CTA) and its provincial association partners are calling on members and all compliant carriers to report cases of noncompliance to provincial and federal agencies.

Reports of noncompliance can be related to the Canada Labour Code, the Tax Code, Workers Compensation Boards, Provincial Revenue Authorities, the Temporary Foreign Worker Program, and other government programs. CTA has created a step-by-step tip sheet/reporting guide to help report suspected Driver Inc reports to multiple agencies.

The tip sheet ensures reporting mechanisms are in place and the industry has a direct line to the appropriate enforcement authorities and advises what type of information should to be included, how to contact the relevant agency and how to send or report the information.

The information submitted to the agencies will help lead to enforcement efforts.While not all tips will automatically lead to enforcement action, quality tips often can provide the basis for formal investigations and audits on companies suspected of gross violations.

“Many employers and workers have respect for Canada’s laws and regulations like paying their fair share and abiding by labour laws and human rights. But not all companies want to follow the rules – they circumvent the system by avoiding taxes and denying employees basic labour rights and, consequently, our industry and society are paying the price for this non-

compliance,” said CTA president Stephen Laskowski.

“Federal and provincial entities have said they stand with CTA in eliminating the abuse by the organizers of the Driver Inc. scheme, which is plaguing our workforce.

This scheme is extensive and undermines several government systems and, as such, we need all relevant agencies to simultaneously focus their enforcement branches on these violators.”

YOUR INTRALOGISTICS OPTIMIZATION PARTNER When you need to move, manage, store and protect goods, make Johnston Equipment ™

your first call. Organizations across Canada count on our deep industry expertise and Complete Solutions™ portfolio to deliver

RUN BETTER. MANAGE SMARTER.™ Discover how Johnston Equipment can help optimize your facility.

efficiencies and innovation across their

Image: freepik/freepik.com

material handling business.

insidelogistics.ca

06-13_IL_Dec23_News.indd 13

johnstonequipment.com 1.800.668.5586 ©2023 Johnston Equipment

130887_JE_Print Ad_4.5x7.5_Insider Logistics_FA.indd 1

13

2023-06-20 8:57 PM

2023-11-27 7:04:14 PM

F M A E X E CU T I V E O F T H E Y E A R

| By Emily Atkins

Gary Fast has been honoured as this year’s Freight Management Association (FMA) Executive of the Year 14

14-17_IL_Dec23_Exec.indd 14

INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:05:34 PM

CHANGING

LAN ES

Canadian Tire’s Gary Fast moves his career onto a new road

A

fter a 27-year career with Canadian Tire, Gary Fast has made a major career change. He’s now running a store for Canadian Tire. And while that may sound like a punchline, it’s no joke.

Fast has been honoured as this year’s Freight Management Association (FMA) Executive of the Year, in recognition of his long career at the iconic Canadian retailer, and for his role in introducing significant innovations in the company’s transportation operations. The well-known executive is making a seamless transition to entrepreneurship.

Fast said in an exclusive interview with Inside Logistics that becoming an entrepreneur and owning a store has been a long-term goal. “Now I’ve finally gotten that opportunity,” he said.

“I would say that from my supply chain career, those skills have been very transferable into this role and have served me quite well in terms of adapting to my new career. Everything from forecasting and replenishment, that’s what we do in the store. We need to order the right products for our customers and our communities, and we need to make sure that it’s on the shelf.

“And we think about being able to process many shipments coming into the stores, warehousing, logistics, and of course, when I was in the transportation and supply chain roles that I had, it was all about servicing the stores, Now I’m the recipient of that service and have to extend that out to the community that I’m in and the customer base that I serve.”

Moving to the front line

Fast left his corporate role as Canadian Tire’s vice-president of transportation late last year, before moving into the front-line retail side. What followed was six months of full-time training the company puts prospective store owners through.

“It was an intense training program with the opportunity to have hands-on practical experience in four stores across the country to get a sense for how the different types of Canadian Tires operate at different sizes. And then when you’re done, you get the opportunity to be awarded a store and start your career,” Fast recounted.

When the training was over, Fast was offered the store in Dauphin, Manitoba. About 300 km northwest of Winnipeg, it’s a smaller market with a population of just under 10,000. The store employs 15 people. He is enjoying the transition from the scale and pace of life in Toronto.

“People here are really great. I grew up in a small town, so definitely it’s not a culture shock. I enjoy being here. The people are very warm, open. You really get to know who’s who in town and who’s shopping at your store. They’ll come in, they’ll pull you aside, they’ll tell you what they like, they’ll tell you what they don’t like. But the one thing they are is friendly!”

Looking back on his 27 years at Canadian Tire corporate, Fast is now grateful for the innovations and process improvements that have given the retailer a robust supply chain operation. insidelogistics.ca

14-17_IL_Dec23_Exec.indd 15

15

2023-11-27 7:05:35 PM

“I was accountable for, or my team was accountable for, all of the deliveries to our associate stores and affiliate banners, and now I’m the recipient of those deliveries. When something goes wrong, when something’s delayed, when something doesn’t come in a reliable manner, you really notice it.

“But I’ve also noticed how much diligence the team or the corporation has put into all those processes over the years, and those breakdowns and failures are so few and far between that when the occasional one may happen, then you really notice it. But we really count on that strong supply chain team to keep doing what they’re doing in order to keep those products coming into this community and getting inventory into the stores so that we can serve our customers. That’s all dependent on a stable supply chain, which, thank goodness, we have.”

Building a robust supply chain

Transportation innovations that support this robust supply chain that happened under Fast’s watch include Canadian Tire being the first carrier in Ontario to be able to run a longer combination vehicle. Following that, they developed the first 60-foot container. Fast said there must be at least 1,000 of them in the fleet now.

The company also created capabilities for container stacking and started two container stacking yards during the pandemic when space was at a premium and you couldn’t find a yard. “We said you can go up,” Fast recounted. The team figured out the stacker machinery they’d need and the processes needed to actually run these container terminals in their own yards.

“It came down to figuring out how to prep the ground and how to pick the right candidates of products that go in the containers so that you’re not making unnecessary moves, and how to integrate that into your technology and into your everyday business,” he said.

The pandemic also prompted the company to start chartering its own vessels. As the 14th largest importer of containerized goods in North America, Canadian Tire had to punch above its class in order to get capacity, Fast said in 2021. With the big shipping lines running a practical monopoly, it was a challenge to pull it off.

Chartering the vessel “allows me to run a charter year-round lop off my peaks, so that I’m a flat-line customer to the steamship lines, because they don’t like to deal with peaks. It’s a capability now that we’ve unlocked. And I think as time goes on, we’re going to get better at that capability,” Fast said at the time.

“Building high performance teams is probably the thing that I’m most proud of. The results always speak to themselves then. So when there’s results, it’s not because I was able to do something, it’s because I built a team that was able to deliver it.”

Taking a 25 percent stake in Ashcroft Terminals was a strategic move for the company.

The $40 million investment in the private rail terminal in British Columbia’s interior allowed the company to gain control over another critical part of its supply chain: transloading.

It just made sense, Fast said in a 2021 interview with Inside Logistics, “we own our distribution centres. We have our own tractor fleet. We own our own container and chassis fleet.”

Gaining control of transloading is “another element in the supply chain that you can control, that you have the ability to scale. It’s about ensuring you have the capacity to run your business as well as having redundancy and resiliency,” he said.

“I was really proud of the team for being able to drive that, the Ashcroft opportunity, integrating rail and transload right from the vessel. That was a very large-scale effort by our strategy team, by a lot of different people, and I was really happy to have played a key role in that.”

Bringing Discipline, Structure and Visibility to the Supply Chain

AUTOMATION ASSOCIATES INC. 6705 Tomken Road, Suite 211, Mississauga, Ontario L5T 2J6

16

www.rfpathways.com INSIDE Logistics DE C E MB E R 2023

RF_P_third square.indd 1

14-17_IL_Dec23_Exec.indd 16

905-565-6560

2022-07-04 3:33 PM

2023-11-27 7:05:35 PM

having that coaching, having that ability to coach and to be able to mentor people is what drives those drives those innovations.”

Culture and leadership

Fast had plenty of time at Canadian Tire to learn and influence the culture, as well as build a more resilient supply chain. Serving in 13 or 14 different positions, starting as a logistics analyst right out of Giving back university, he had lots of exposure to different areas of the business.

He had two years as a mechant, responsible for buying the camping Fast didn’t just apply his leadership skills within the company. He also did a turn as FMA chair and on the Toronto Transportation line for Canadian Tire that serviced four locations.

“That’s where I really got to see a little more of the hands-on re- Club executive. He points out the importance of building busitail. And that started to get me interested, but then I had an oppor- ness relationships as well as giving back to the industry where he tunity to become an associate vice-president in transportation,” he built his career. “The industry has given a lot to me. Participating said. He held two associate vice-president roles before becoming the in these types of organizations was an important way, not just to vice-president of transportation in 2018. make connections, but also to be able to share ideas and to contribOver the years, through all the different experiences at Canadian ute and to give back,” he said.

Tire, Fast said his favourite accomplishment has always been buildBeing recognized as the FMA Executive of the Year is a true honing and leading teams. “There’s a lot of great moments and accomplishments, but being a people leader is really where I found a lot of our, Fast said. “Whenever I see this particular award given out, it’s more like an accumulation over a career where you’ve actually made my passion,” he said.

“And building high performance teams is probably the thing that an impact in the industry. And I feel like I’ve been able to give back I’m most proud of. The results always speak to themselves then. So to the industry and to give back to the transportation world and the when there’s results, it’s not because I was able to do something, it’s supply chain world, and I think they recognize that and we’re happy because I built a team that was able to deliver it.” to recognize it through this very prestigious and fantastic award.”

He points to the pandemic as the perfect example. “We were able The staff at the Dauphin Canadian Tire store, and its customers to source product when nobody could. We were able to do incredible should count themselves lucky to have Fast on their team. He may be things like charter vessels, and none of that would’ve been possible one of the newest dealers in the country, but the skills, experiences without the people that I worked with. I had an amazing team.

“And that’s all about building culture, mentoring, creating some and insights he gained through his 27-year career at Canadian Tire strategic direction, but then empowering people and giving them corporate should make him a dealer unlike any other, with his finger on 25, the supply chain pulse. some guardrails, but empowering them to do the work. And I think 22_0470_MH_Conveyor_HalfHoriz_US_MXsp Mod: September 2023 11:25 AM Print: 09/25/23 page 1 v2.5

π SHIPPING SUPPLY SPECIALISTS

KEEP YOUR BUSINESS ROLLING CONVEYORS, BOXES AND MORE

ORDER BY 6 PM FOR SAME DAY SHIPPING

COMPLETE CATALOG

insidelogistics.ca

14-17_IL_Dec23_Exec.indd 17

1-800-295-5510

uline.ca 17

2023-11-27 7:05:35 PM

ADVERTORIAL

SIMPLE DC ORDER

FULFILLMENT UNLOCKS In any DC environment, order fulfillment efficiency is critical to keep operational costs low and to ensure high service levels with quick turnaround. Some organizations will look to automation and systems to support this, while others may not be able to afford it. If you find yourself in the latter category, there are several things you should be looking at, if you’re not already, to help your business! Here are just a few:

1

2

3

4

5

VELOCITY SLOTTING As mentioned in the October issue of Inside Logistics, velocity slotting is a critical step in any DC fulfillment set up to mitigate receiving, picking, and inventory management time.

Be sure to review your ABCD classifications and use this information to ensure your top moving items are slotted as close to where they will be required as possible. In many cases, we find that this step alone can save organizations on average over 25% in labour costs and in some cases over 70% if they don’t already have this discipline in place.

PRIMARY PICK FACES AND PICK PATHS Primary Pick Faces are set locations where a product is placed for fulfillment and replenishment. Setting these up using velocity slotting and logic in the Pick Path, work very well for efficiency. We recommend reviewing products for cube and weight, so that as Operators are moving down the Pick Path, they are not inadvertently picking a heavy product that will be put on top of a light product and crushing it.

BULK PICKING Consider reviewing your order deck in Excel and sorting it by SKU. You might be surprised how many orders call for the same product(s)! Instead of sending Operators out with one order at a time, review how many units of each SKU are needed in total, and go Bulk Pick everything at once. Then pull forward to a central processing area where Products are more easily accessible. From here, Operators can easily pick what is needed to fill the orders and proceed to shipping with very little travel time.

FLAT FILE EXCHANGE WITH COURIER SYSTEMS If you don’t have a TMS solution to support your Final Mile delivery processing, chances are you are using a stand alone Courier System or a Web Solution. If you haven’t already, be sure to speak with your provider about how you can exchange Flat Files to upload your daily orders to their system. This will allow your shipping teams to either enter the Order # in the Courier System, or scan the Order Reference on an LPN if available. This will in turn load the complete order with shipping information in the courier system for quick, and accurate processing. At the end of day, the manifest can be exported in a flat file format that can then be imported back into your order system to load all the tracking and cost information.

BATCH PRINTING COURIER LABELS In conjunction with Flat File Exchange with your Courier Systems, you may want to explore batch printing all your courier labels in advance of picking. This would essentially allow your picking teams to apply the courier labels at the time of picking and avoid the need to process at the shipping station later. This works well with single sku, single carton shipping when the weight and dims of products are already known.

It is our experience that one solution does not fit all in DC’s and we therefore introduce different solutions for our clients unique challenges. Explore some, or all, of these simple DC Order Fulfillment unlocks for yourself and let us know about your experience.

OPTIMIZING WAREHOUSE CAPACITY, IMPROVING INVENTORY ACCURACY WE ARE CANADIAN DISTRIBUTION CONSULTING EXPERTS WITH OVER 24 YEARS EXPERIENCE IN:

▶Warehousing ▶Distribution ▶Transportation ▶Management ▶Supply Chain Consulting NOT SURE WHERE TO START? GIVE US A CALL WE’RE HERE TO HELP! 368-999-0103 www.fivealarmconsulting.com

19_IL_Dec23_Order.indd 18

2023-11-27 7:06:28 PM

ORDER FULFILLMENT

| By Keith Moore

SMOOTH OPERATOR New tools mesh seamlessly with existing software to optimize fulfillment EVERY SHIPPER RUNNING a supply chain is concerned with order fulfillment – are they going to be able to get the right product to the right location, at the right time, in order to execute a pre-existing purchase, or ensure that a future one occurs?

This concern is not unfounded. Even with the best planning team in the world, the execution phase is where the rubber meets the road.

The challenges are many: ensuring there are enough trucks available for transportation, managing warehouse space for inbound shipments, and ensuring there’s adequate labour to process orders. These are just a few of the constraints that can hinder the smooth operation of a complex supply chain.

Luckily, a new breed of optimization technologies has started to emerge to ensure that inventory flows seamlessly from a manufacturing location to a customer, irrespective of the sales channel.

These new technologies bridge the gap between planning and transportation execution.

By employing advanced optimization techniques, these solutions are designed to streamline transportation plans, maximize truck capacities, and guarantee timely deliveries. The magic lies in the deployment planning space, where constraint-based mathematics is employed to strike a balance between minimizing transportation and distribution costs and maintaining inventory levels that meet customer demands.

By integrating data from transportation management systems (TMS), warehouse management systems (WMS), and other planning systems, this software can proactively position inventory, navigate constraints, and dynamically adjust transportation volumes based on demand.

Additionally, they excel at load optimization, ensuring that each truck is loaded to its maximum capacity, resulting in fewer trucks transporting more products.

Delving deeper into the realm of load optimization, the benefits are multifaceted and directly impact both the bottom line and customer satisfaction. First, by maximizing the capacity of each truck, companies can achieve significant cost savings in fuel, labour, and maintenance.

Fewer trucks on the road means reduced fuel insidelogistics.ca

19_IL_Dec23_Order.indd 19

KEITH MOORE is CEO of AutoScheduler.AI.

consumption and fewer emissions, aligning with sustainability goals.

Labour costs are also optimized, as fewer drivers are required for the same volume of deliveries.

Maintenance costs for the fleet decrease as the wear and tear – on fewer vehicles – is minimized.

On the service front, optimized loads lead to more accurate delivery windows. With trucks filled to capacity, there’s a reduction in the number of trips, which in turn reduces the chances of delivery delays. This ensures customers receive their orders promptly, enhancing their overall experience and fostering loyalty. In essence, load optimization not only streamlines the transportation process but also translates to tangible financial savings and elevated service standards.

Once the transportation is planned to ensure that all bottlenecks in the supply chain are reduced and costs are minimized (without compromising service), the focus shifts to the heartbeat of the supply chain: distribution sites. This is where scheduling solutions come into play.

These tools offer intelligent warehouse orchestration, providing a holistic view of inventory, receipts, labour, equipment and customer shipments. The objective is clear: streamline the flow of inventory through the facility and ensure timely dispatch of products.

What sets these tools apart is their ability to employ mathematical optimization. They can

process a multitude of constraints, from equipment capacities and shift schedules to space availability, all with the overarching goal of reducing costs and boosting throughput.

Warehouse environments are inherently dynamic, with a myriad of moving parts that constantly interact and evolve. From fluctuating inventory levels and changing customer demands, to unexpected equipment breakdowns and workforce availability, warehouses are hubs of activity that require meticulous orchestration.

Technologies that offer advanced optimization capabilities are not just about driving cost savings; they’re about bringing predictability to this chaotic environment. By analyzing and processing vast amounts of data in real-time, these tools can forecast potential bottlenecks, allowing supply chain managers to proactively address them before they escalate.

Furthermore, they provide a transparent view of the entire supply chain, ensuring that every stakeholder, from the warehouse floor worker to the top-tier executive, has a clear understanding of how execution will unfold. This level of visibility is invaluable. It not only ensures smoother operations but also instills confidence across the supply chain, as everyone is equipped with the knowledge of what to expect and where challenges might arise.

Together, these tools that bolt on to traditional software solutions (ERP, TMS, WMS) are game-changers in the realm of order fulfillment.

They offer a fresh perspective and innovative solutions without necessitating a complete overhaul of existing systems. Instead of “rip and replace” strategies that can be costly and time-consuming, these bolt-on tools enhance and optimize existing infrastructures, ensuring that supply chains operate at peak efficiency and customers receive their orders as promised.

Many of the world’s leading businesses have invested heavily in these indispensable assets. By eliminating the need for disruptive changes, these tools allow companies to leverage their current investments while reaping the benefits of modern optimization. They represent the future of supply chain management, where innovation meets practicality to deliver unparalleled results.

19

2023-11-27 7:06:28 PM

WA R E H O U S E AU T O M AT I O N

| By Del Williams

THE FOUNDATION OF WAREHOUSE AUTOMATION Automated systems depend on integration with steel racking

In modern warehouses, automated system speed and reliability depends on proper integration with various types of steel racking 20

20-23_IL_Dec23_Racking.indd 20

INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:07:19 PM

WITH CONTINUED E-COMMERCE growth companies must constantly re-evaluate their inventory needs, so they can reliably fulfill orders quickly and efficiently. In this effort, automation is a crucial element in material handling efficiency that is becoming the standard in modern logistics.

“Today, every company that has warehousing or distribution has either implemented some type of automation or is considering it. The largest companies are incorporating ASRS [automated storage and retrieval systems], autonomous robotic devices, and AGVs. Smaller companies are using a scaled-down approach such as shuttles or conveyors to increase their operational efficiency,” says Bryan Gauger, president of Cisco-Eagle, a material handling systems integrator.

These automated systems pick products, totes, or pallets from increasingly voluminous, precise storage locations and move them to designated areas for shipping and fulfillment. In contrast to labour-intensive, manual material handling, automation can significantly improve productivity, accuracy, and consistency, while reducing operational costs.

However, it is essential to understand how indispensable a role the racking plays in enabling warehouse automation. “In any automated warehouse system, the rack is foundational. It is the base of the system, where all inventory is stored and retrieved, so it plays an integral role in the automated system’s overall reliability, productivity, and efficiency,” Gauger says.

He adds that the rack structure must provide a controlled environment in which every storage location is uniquely identified, tracked, and integrated with the automated warehouse system.

The trend toward increased warehouse storage density, along with automation, is only intensifying the need for greater precision and tighter tolerances. High-density storage is becoming common with drive-in, pushback, and pallet flow racking, and even floor-to-ceiling rack-supported buildings.

Narrow aisles are leaving only inches for autonomous vehicles and robotic devices to pass.

With warehouses storing ever greater volumes and variability of product, the racking must also be rigorously engineered to meet all necessary building and construction codes.

N

Critical tolerances When the warehouse rack systems used with automation are more than 10 metres high, any out-of-tolerance dimensions can quickly cause errors or damage when automated systems attempt to store or retrieve items. According to Gauger, exceptionally tight rack tolerances in the range of only one to two-millimetre variations have become essential today, even though it can be challenging for rack providers.

Extremely tight rack tolerances are required to use ASRS. These advanced warehouse management systems are designed to efficiently store, retrieve, and manage inventory in manufacturing, distribution, and storage facilities. ASRS combines conveyors, shuttles, and robotic mechanisms with software control systems to automate the movement of goods from multiple levels within a storage facility to make efficient use of the available space.

Because of this, rack tolerances must be precise for the ASRS’s computer-controlled storage and retrieval system to work properly. If tolerances are off, loads can deposit into a beam, upright, or in the wrong storage location.

Gauger points out that automated crane systems, commonly integrated with ASRS, must be paired with racking of remarkably precise construction to function reliably. “When [a crane] expects a pallet to be at a defined location and height, there is little room for error,” he explains.

“If the rack does not meet required tolerances or FEM Racking and Shelving specifications, every rack location has to be mapped into the crane’s control system row by row, which is very time-consuming. To avoid having to map the entire system, they need the rack to be constructed to very tight tolerances.” FEM Racking and Shelving is an international organization that represents and protects the interests of the racking and shelving industry by promoting common technical standards.

The construction of the rack also plays an important role in facilitating automation. Although Cisco-Eagle can work with any vendor, Gauger often opts to partner with a preferred rack supplier, Steel King Industries, an OEM that provides pallet rack and custom storage rack solutions.

“The construction of the rack is very important, including where the holes are punched, how it is welded together, the straightness of the beams, and the squareness of the uprights.

This is as important as anything within the system’s design – and that is what they offer. For instance, they use primarily robotic welders to provide reliable and precise welds,” Gauger notes, adding the two companies have collaborated on projects for over 30 years.

f steel racking. insidelogistics.ca

20-23_IL_Dec23_Racking.indd 21

21

2023-11-27 7:07:19 PM

SUPPLY CHAIN

E X P E R IENC E THE F UL L SPEC T RU M OF SUP P LY C HA I N S O LUT I O NS 04 As the speed of the manufacturing and supply chain world continues to accelerate, building a more agile, sustainable and transparent operation depends on today’s forward-thinking decisions. MODEX brings together the entire industry to allow you to see end-to-end solutions — from traditional equipment to automation, robotics and emerging tech — and learn impactful trends from the industry’s key thought leaders.

Make plans to attend MODEX 2024 and see in-person the full spectrum of what’s now and what’s next for supply chains.

K E Y N O T ES

150

E D UCAT IO NA L SESSIO N S

1K

SO LUT IO N P ROVID E RS

45K+

GE ORG I A WO RL D CO N G RESS CE N T E R ATL A N TA | MARC H 1 1 - 1 4, 20 24

RE G I S TER FOR FREE AT M O DE X S H OW.CO M

20-23_IL_Dec23_Racking.indd 22

FULL SP ECTRUM

M AN UFACT U R I NG & SUP P LY C HA I N P RO FESSIO NA L S

2023-11-27 7:07:20 PM

Pallet flow racks can store up to 100 percent more product than selective racks and reduce aisle space by 75 percent.

Engineered solutions Although Cisco-Eagle has its own engineers, it finds that working with a supplier like Steel King facilitates integration with automation, because the OEM’s engineers provide valuable assistance with rack design. The collaboration enables full integration of AGV use and the optimization of extremely space-efficient high-density pallet rack designs, such as pallet flow and pushback.

“Since most warehouses are 25 to 40 feet tall, we can utilize the entire cubic space from wall to wall, floor to ceiling, with a rack like pallet flow or pushback. When you utilize AGVs to pick inventory from these locations, the benefits multiply even more through automation,” says Don Heemstra, vice-president, sales at Steel King.

Pallet flow racks can store up to 100 percent more product than selective racks and reduce aisle space by 75 percent. These racks use dynamic flow rails inclined in a static rack structure, so loads placed on one end safely move by gravity on rollers to the unloading end, with speed controllers acting as gentle brakes. When designed and installed correctly, removing each pallet load will cause the pallets behind it to move forward automatically.

Pushback pallet racks offer up to 90 percent more product storage than selective rack systems and up to 400 percent more selectivity than drive-in rack. Unlike static, single-palinsidelogistics.ca

20-23_IL_Dec23_Racking.indd 23

let-deep selective racks, a dynamic pushback rack system allows storing pallets two to five deep while providing easy access to various SKUs. Pallets are stored behind each other in a series of nested carts and load from the same side of the system. This eliminates separate aisles for each function. Composed of a stable rack along with a series of inclined carts and rails, the pushback system allows one pallet to roll forward when a pallet is pulled.

“Even drive-in and bulk static rack can be integrated with some AGVs,” Heemstra says.

As the rack becomes larger and more complex, it must be designed for the specific location, expected seismic activity, and required loads. When this is necessary, according to Cisco-Eagle’s Gauger, engineers at a rack supplier like Steel King help expedite the process of meeting code.

“Their engineers often research the building location, determine the seismic zone, and tell us what we need to do to meet code, such as use larger base plates or additional bracing. Their expertise will also help us meet a new specification through the Rack Manufacturers Institute (RMI) that will be published in the 2024 International Building Code,” Gauger points out.

The OEM’s engineers also assist with design for racking, such as ASRS, which must often be strong enough to support stored pallet loads or mini loads up to 40 feet high. Larger unit-load ASRS are usually designed to handle pallet loads of 1,000 pounds or more, while smaller mini-load ASRS typically handle product loads of less than 1,000 pounds in totes, trays, or cartons.

Viewing warehouse system automation from a wider lens, Gauger considers the future of automation and the importance of the engineered racking that serves as its foundation.

“As customers require faster fulfillment and warehouses greater productivity, automation will account for an ever-larger portion of the material handling marketplace,” he concludes.

Del Williams is a technical writer.

23

2023-11-27 7:07:21 PM

PL A N N I N G

| By Matthew Bardell

WHY THE C-SUITE SHOULD PAY MORE ATTENTION TO INVENTORY STRATEGY PRE-COVID, IT WOULD be fair to say that most executive boards didn’t have inventory high on their list of corporate priorities. Inventory is mundane. If you sell goods then you almost certainly need it, in the same way that you also need accountants or electricity.

But it wasn’t the board’s job to deal with that.

Someone somewhere in operations or supply chain dealt with that sort of thing while the board concentrated on more strategic topics like M&A, R&D, growth.

But in the same way that you only really notice the necessity of electricity when you are deprived of it, the supply chain disruption caused by Covid suddenly made inventory a critical topic. Do we have enough? Can we sell any of it? Can we get it to where we need it?

And this brought to executive light a whole range of challenges all too familiar to supply

chain professionals: how easy is it to know how much inventory you have (and where) in anything close to real time? How much inventory should you hold, given demand is even more uncertain than usual? How do you deal with supply lead times being very much longer (and more uncertain) than customer lead times?

It is said that you should never let a good crisis go to waste, and the pandemic has had a number of positive effects on supply chains: the profile of the discipline has risen, its criticality underlined. Many companies have invested and continue to invest in technology to support and enhance supply chain processes.

But there is a risk that the wrong lessons have been learned and that the investments go to waste. Having enhanced inventory visibility makes established ways of working more

efficient and effective. You need to know how much you’ve got before you can decide how much more or less you need, right?

But one of the biggest mistakes in inventory management is assuming that humans are good judges of how much inventory is required. The only bigger mistake is in thinking that technology is any better.

This sounds negative. The main problem is that in most cases, inventory is not really managed. It is the by-product of business processes, in particular, various supply chain planning processes (S&OP, production scheduling, material requirements planning, etc.)

And you end up with a volume of inventory not because you wanted that volume of inventory, but because that is how much you have once the effect of all the various processes in your business have netted themselves out.

INDEX OF ADVERTISERS COMPANY

WEBSITE

PAGE

3D Storage.................................................................... 3Dstoragesolutions.com . . ........................................................................... 4 Automation Associates Inc. . .......................................... www..rfpathways.ca ................................................................................... 16 Baumann.. ...................................................................... www.baumann-sideloaders.ca.................................................................. 28 CITT............................................................................... www.citt.ca/cclp.. .................................................................................... 8-10 Five Alarm Consulting................................................... www.fivealarmconsulting.com.................................................................... 18 GX Transport................................................................. www.gxts.com............................................................................................ 12 Johnston. . ...................................................................... www.johnstonequipment.com................................................................... 13 Keypak........................................................................... www.keypak.ca........................................................................................... 31 Konstant........................................................................ www.konstant.com.................................................................................... 32 MODEX......................................................................... MODEXSHOW.COM................................................................................. 22 Munich. . ......................................................................... www.roanokegroup.com........................................................................... 25 North American Steel.. .................................................. www.naseco.ca........................................................................................... 11 Polaris............................................................................ www.polaristransport.com.......................................................................... 2 Prof4Soft. . ...................................................................... www.p4warehouse.com.. ........................................................................... 27 Trew North.................................................................... TREWautomation.com................................................................................. 7 Uline.............................................................................. www.uline.ca............................................................................................... 17

24

24_IL_Dec23_Resilience.indd 24

INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:08:30 PM

And one of the problems with this is that incentives and KPIs across the organization are not aligned with a specific inventory target. For example, many organizations look to the sales department for a forecast. Sales staff are incentivized to maximize sales, they’re not incentivized on forecast accuracy, still less on inventory levels (unless, after the fact, they’re incentivized to shift excess or obsolete stock).

Production staff are incentivized to run production efficiently and to hit output targets, they’re not incentivized to maintain particular inventory levels. Supply chain planning teams may have inventory turns on their scorecard, but it is only of secondary importance compared to material availability.

The net result of all this is that there are multiple forces which drive inventories inexorably upwards. All of the other incentives are good and add value – you want higher sales, efficient production and good material availability – but because the counter-incentives are overpowered, it becomes very difficult to find the right balance.

The result of this lopsided incentivization is excess and obsolete inventory. This generates write-offs and waste, it fills up warehouses with inventory that costs money to hold, and it clogs up production schedules, making companies slow to respond to changing market conditions.

The only reason this state of affairs is allowed to continue is that more or less everyone else is doing the same thing. In a market economy, you don’t have to be good, you just have to be better than your competition.

If investments in supply chain technology and capability only allow the status quo to function more efficiently, they are missing a massive opportunity.

The best way to solve the problem is to put inventory right at the heart of your supply chain strategy. You want enough inventory to protect you against uncertainty and volatility.

But you don’t want so much that it makes you slow to react to rapidly changing conditions, and you don’t want to be regularly scrapping it or writing it down to less than cost.

This will make your supply chain resilient and give you competitive advantage.

This requires different ways of thinking about inventory and different orchestration of the enterprise and this is why inventory strategy needs to be a board priority. We know from repeated experience that supply chain can’t fix this on their own.

Not because they don’t know what needs fixing, but because so many of the key levers are outside of their sphere of influence.

Too much inventory management software is either designed to facilitate old ways of working or is incorrectly being used to replicate old ways of working. But even if it can genuinely carry out advanced inventory optimization calculations, it is powerless to deliver change without the right alignment of people and incentives.

The C-suite shouldn’t be doing supply planning’s work for it, but it should be creating the environment and conditions for supply chain to be successful.

Instead of having periodic purges of excess inventory, boards should rethink their inventory strategy and align their whole organizations with it. Only in this way can they hope to truly build resilience.

24_IL_Dec23_Resilience.indd 25

INSURANCE | SURETY BONDS

1.800.ROANOKE ROANOKEGROUP.COM

Matthew Bardell is managing director, nVentic.

insidelogistics.ca

Cross with Confidence!

25

2023-11-27 7:08:31 PM

CO M PL I A N C E

| By Rejean Provost

HOW TO AVOID RUNNING AFOUL OF CANADA’S NEW FORCED LABOUR BILL Companies have until June 2024 to start reporting AFTER COMPLAINTS THAT CANADA had for too long turned a blind eye to the problem of forced labour in supply chains, the country is moving forward with significant reforms.

Passed this spring after four years of debate, Bill S-211, officially known as the “Fighting Against Forced Labour and Child Labour in Supply Chains Act,” places the responsibility on brands, retailers, and importers to identify and prevent forced labour and child labour within their supplier networks.

The law, which goes into effect January 1, 2024, applies to both domestic and international businesses that meet at least two of these three thresholds: $40 million in gross worldwide revenues; $20 million in assets; or an average of 250 employees or more.

It applies to all businesses, regardless as industry, but given fashion and apparel’s well-documented links to forced labour, it’s sure to have an especially pronounced impact on Canadian garment companies and retailers.

The law requires fashion brands and retailers to produce annual reports outlining their due diligence measures to identify and mitigate the risk of modern slavery in their supply chains.

These reports must include information about a company’s policies, procedures, risk assessments, and remedial actions taken to address any identified issues. To ensure transparency, these reports must be published on a publicly accessible website.

Personal liability The first reporting deadline under the law is May 31, 2024, a date that’s sure to receive considerable attention in boardrooms because of the law’s unique enforcement structure.

Businesses that don’t comply will be subject to fines of up to $250,000, and unlike other global supply chain due diligence laws, Bill S-211 holds business leaders personally liable for any company offenses they directed, authorized, or in any way participated in. If that language strikes fear in chief executives, it’s meant to.

26

26_IL_Dec23_Bill s211.indd 26

Complying with the law will pose considerable challenges, especially for fashion brands and retailers that must navigate complex global supply chains with hundreds of suppliers. That requires coordination, accountability, and visibility, but thankfully it’s made much more manageable by a multi-enterprise platform, also known as a multi-enterprise collaboration network. These cloudbased platforms support collaboration between businesses, their suppliers, and their third-party partners, introducing complete visibility into a company’s supplier base, from vendors to factories to raw material providers.

Supplier management safeguards To comply with the law, supply chain managers will need to establish robust systems and processes to identify and address any instances of modern slavery or forced labour within their supply chains. This involves enhanced supplier vetting, auditing, and monitoring mechanisms to ensure compliance and ethical practices – all of which can be simplified through the supplier relationship management (SRM) tools of a multi-enterprise platform.

These platforms create a window into an enterprise’s entire supplier base, enabling the traceability that Bill S-211 requires. Through their supply chain mapping functionalities, businesses are granted a fuller understanding of their social and environmental footprint, including where all transformations of raw materials occurred, how much carbon they’re emitting, and whether their downstream suppliers are vetted and accredited.

An end-to-end platform like this allows businesses to easily document the chain of custody of every material they use in every product they make, so they can prove that no forced labour was involved at any stage of its creation.

Multi-enterprise platforms also foster collaboration with industry associations and non-governmental organizations (NGOs) that can also prove invaluable in navigating

the complexities of supply chain management in light of Bill S-211. It is possible to integrate with sustainability databases from business associations and non-profits like Amfori and Worldwide Responsible Accredited Production (WRAP), which monitor and certify the social sustainability of factories and suppliers.

These industry-approved certifications save retailers the enormous effort of having to conduct rigorous audits themselves. By making critical certification details available in real time, a multi-enterprise platform eliminates the need for supply chain managers to log in to multiple systems, speeding up the sourcing process.

These platforms create other efficiencies as well, for instance by saving retailers and brands time through automating the onboarding process for vendors and factories, and ensuring that all new suppliers have read and consented to the company’s terms. This way, from the very earliest stages of working with a supplier, there’s total transparency about your ESG standards and expectations.

This software also enforces a company’s social and environmental standards by preventing merchandisers from booking orders with non-compliant suppliers and preventing shipping departments from booking shipments with these vendors. These are the kinds of safeguards that brands and retailers need in place to prevent lapses that could violate Bill S-211.

There’s no sugarcoating it: Bill S-211 will be a tough adjustment for many apparel companies, but it’s a necessary one. By implementing responsible sourcing practices with a multi-enterprise platform, businesses can protect their reputation, strengthen consumer trust, and contribute to a more sustainable global supply chain ecosystem, while fostering the long-term resilience they need to remain competitive well into the future.

Rejean Provost is the team lead, ESG strategy, for TradeBeyond.

INSIDE Logistics DE C E MB E R 2023

2023-11-28 4:20:56 PM

real-time visibilty The 2023 Highway H2O Conference took place in Toronto from October 17-19. The theme was opPORTunity: The Seaway Solution, and focused on how ports are economic drivers of activity for their city and region.

More than 150 delegates joined to hear 15 speakers in three panels and two keynotes. Speakers addressed mental health and brain growth, along with a focus on decarbonization of the Port of Detroit. Many speakers were first time participants in the conference and brought new insight and energy to the dialogue.

Attendee feedback was positive, with many commenting on how the event successfully made networking connections and initiated conversations.

Cloud-based Warehouse Management System • FIFO/LIFO Alloca�on, Picking, and Packing • Mul� carrier shipping (Canada Post, FedEx, UPS, more…)

• Cross Docking • Compliance label prin�ng (Walmart, Macy’s, Amazon, etc.)

• Zebra cer�fied Android handheld applica�on • And more…

Contact us: +1 (833) 749-9473 | sales@pro4so�.com | www.p4warehouse.com Company based in Toronto

insidelogistics.ca

27_IL_Dec23_Real-Time Visibility.indd 27

27

2023-11-27 7:10:34 PM

O PE R AT I O N S O U T L O O K

| By Victoria Jones

INFLATION AND SUPPLY CHAIN OPS INFLATION HAS AFFECTED us all at an unprecedented Consumer spending habits have both decreased and rate since the beginning of Covid-19, hitting us where increased since the beginning of Covid-19, and we are it hurts – our mortgages, loans, and possibly the most starting to see reductions in spending again. Inflation painful, the rising price of food. has proven to be very temperamental and central banks One thing these increases have in common is the supply continue to favour a high interest rate environment. chain. This is a theme that ties into rising shipping rates, As we continue into the end of Q4 for 2023 and into fuel surcharges and the cost of warehousing space, as well the beginning of 2024, supply chain volumes will likely as storage and the movement of goods, from both a supplier be reduced as the cost of borrowing for consumers and consumer perspective. continues to be high and they run through available The inflation rate in Canada declined to 3.8 percent in credit lines and credit cards for purchases.

September from a 4.0 percent high in August. The Bank of With these expected fluctuations in inflation, pricing Canada’s Monetary Policy Report projected at the end of in the industry will likely remain status quo, according VICTORIA JONES October that inflation will stay around the 3.5 percent mark to Lyndon. “However, any significant increase in is a Logistics and Inventory until the middle of 2024. They are expecting inflation levels demand could increase shipping costs slightly as carriers Specialist at Tyers Foods to return to the target 2.0 percent in 2025. leverage into higher rates. We do not foresee large The full impact when it comes to interest rates and the change in the cost in the short term,” she said. trucking industry likely won’t be felt until we are further We will likely see this translate into the holiday down the road. The industry will have to balance out somehow and this season as consumers are planning to shrink their holiday spending, will likely be where it is hit with rising wages for truck drivers and an which is likely to have an effect on carrier costs and consumer increase in equipment costs in the coming years. goods as demand begins to shrink. According to a survey conducted As we have seen in similar markets with warehousing cost increases, with 1,000 Canadians by Deloitte Canada, anticipated spending the purchase price of transportation equipment today will not be the for this holiday season is hovering around $1,347, the lowest same in a few years. It is inevitable that the price will increase but the amount reported in the last five years. According to Deloitte this question remains as to how much. anticipated spend is down 11 percent from the 2022 forecast of Purchasing new vehicles will also become more volatile as loan costs $1,520, and an even larger drop from the 2021 holiday spending are likely to continue to increase, along with continued delays and forecast of $1,841. persistent microchip shortages. With these factors in mind it is a possiEveryday costs of living are likely to keep the supply chain busy bility that we may see a larger shift to vehicle rentals versus vehicle however as the average consumer spending is still on an upwards purchases as people try to avoid higher loan costs. trajectory. The fear of recession continues to loom over the heads of “Supply chain volumes have experienced wild fluctuations due to Canadians. The same survey reported two-thirds of respondents were these changes in product volumes moving with the supply chain. We concerned about the possibility of a recession. know we have not resumed normal levels just yet,” said Jane Ayn Lyndon, Lyndon also confirmed that her company has seen decreases in both director of western region for Mactrans Logistics Inc., in an interview. volume and rates in truckload shipments when reviewing weekly load She said factors that have contributed to inflation include rising costs to truck ratios in relation to demand of shipping and availability of of resources, labour shortages, regulator costs and taxes being passed equipment. While many LTL rates are negotiated annually, Lyndon into consumer pricing, along with energy volatility and supply disrup- expects rates to remain static in future negotiations, confirming that tions driving up the cost of fuel. the situation really is all about supply and demand.

28

28_IL_Dec23_Victoria.indd 28

INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:11:19 PM

T R A D E U P DAT E

CANADA’S TRADE OUTLOOK FOR 2024 THE EXPRESSION ‘’TRADE WAR’’ was coined

under the previous U.S. president to describe the trade tensions with China, which resulted in U.S. antidumping duties being imposed on many Chinese imports.

We should be careful with the words we use and, in my opinion, using the term ‘’war’’ was inappropriate. For those who didn’t notice, we’ve since seen two examples of what the word ‘’war’’ means with the conflicts in Ukraine and Palestine. These are real wars happening today in front of our eyes, live on TV and social media, and terrorists filming their actions, with the objective of broadcasting them.

This is in addition to ongoing localized conflicts in Syria, Yemen, Sudan, Myanmar, among others. The impact on international trade is real: higher costs, insecurity, disruptions, a slowdown in investments in production and exports, lower growth rates and hardship for civilian populations.

The last decades brought globalization and freer trade, generally leading to improved economic well-being, but the world has now entered a new era, where geopolitics is bringing a new kind of trade protectionism, if not economic isolationism.

Trade agreements lose favour

Free Trade Agreements are no longer the flavour of the day, as nearshoring, friend-shoring and security issues prevail. These conflicts lead to trade complications by way of sanctions and export/import controls. This is definitely the case with Russia, but also with China: consider the U.S. law fighting against forced labour, specifically targeting imports from the Chinese Xinjiang region, where the Uyghur population is persecuted. Canadian manufacturers who export to the U.S. must ensure they have no direct or indirect inputs from that region. [See page 26 for the full story] Globalization can take on a whole new meaning as well: just as 102 countries lost citizens in the horrific 9/11 attacks, more than half of the estimated 240 hostages taken by Hamas have foreign passports from 25 different countries.

This new reality is affecting importers and exporters. Knowing both our suppliers and our customers ensures visibility and traceability of

Canadian mining companies operating in these countries. And all this is leading to a more fragmented world, where doing business and trading goods gets more complicated, if not more dangerous.

Canada’s international merchandise trade has been recovering well from the pandemic: our exports were up 2.7 percent in September, with energy contributing the most to the gain (10.67 percent), while our imports rose 17 percent. Overall, our international trade has now surpassed pre-pandemic levels.

CHRISTIAN SIVIÈRE runs Solimpex, and is an international trade consultant and lecturer. christian.siviere@videotron.ca

our supply chain. For example, since Canada has banned the importat of steel and aluminum from Russia, when a Canadian company purchases aluminum products from any supplier worldwide, it has to make sure its vendors have not sourced their raw material from Russia.

Our exporters can no longer sell ExWorks, leaving all exporting, documentation and shipping responsibilities to the purchaser, and turn a blind eye on the ultimate destination of their products. We have to know our customers and do due diligence on the end user, making sure our exports don’t end up in the wrong place.

The world seems to be at a turning point, with democracies and the rule of law losing ground worldwide and a new world order emerging. We’ve seen how many countries support Russia, directly or indirectly: not just China, India, South Africa or Brazil, but all the despotic countries in Africa, the Middle East and South-East Asia. We see demonstrations in support of Hamas around the world, and even at U.S. universities, turning into anti-Western protests. Several African countries are cozying up to Russia, inviting Russian mercenaries to provide security, like in the Central African Republic or Mali.

These developments are concerning for

The elephant next door

But in spite of the various free trade agreements we signed over the last few years – CETA with the European Union (and extended to the U.K.) and the Trans-Pacific Partnership with 10 Pacific countries, including Japan – 757 percent our exports still go to the U.S. and over 507 percent of our supplies come from there. It seems like no matter how hard we try, we can’t diversify our markets and still depend largely on our Southern neighbours.

In the end, although world tensions and geopolitics matter a lot, what will impact us the most is what is going to happen in the U.S., where polarization, disinformation and protectionism continue to grow. There is a strong chance that the 45th President will get elected again, and a Republican party candidate is openly in favour of building a border wall with Canada.

We should be very worried about the populist trade skepticism in Washington, prevailing both on the Republican and the Democratic side. We have an example of that, with President Biden recently announcing that the U.S. was pulling out of negotiations under the Indo-Pacific Economic Framework Initiative (IPEF).

With all of this, the outlook for trade in 2024 is very uncertain. Canada is a resource-based economy but to export our resources, our minerals, our grain, our forest and other products, we need a peaceful world order. With all these conflicts, let’s hope that the good guys will win and not the bad guys, leading to a more peaceful and orderly world.

insidelogistics.ca

29

29_IL_Dec23_Trade_Update.indd 29

2023-11-27 7:12:01 PM

SAFET Y FIRST

IS LOW RISK PERCEPTION A PROBLEM IN YOUR WAREHOUSE? Six tips to help workers understand the consequences of neglecting safety MANY PEOPLE MAY find themselves com-

pleting the same jobs and tasks daily.

But how many times do they pause to consider the risks that are related to these seemingly mundane tasks? If people don’t fully appreciate the risks, health and safety protocols may not be top of mind.

What is low risk perception?

Low risk perception refers to the cognitive bias in which individuals underestimate the potential dangers or hazards present in their work environment.

As people become more comfortable with a task, they can become complacent.

They don’t think about the risks and that safety procedures are in place to protect them. For example, in a warehouse and distribution centre, the following scenarios are common:  A lift truck operator and a worker move through the same space without considering the risk of crush injuries.  A worker places a broken pallet on upper-level racking with excessive overhang on the back beam, not thinking the load may shift and fall.  A young worker in good physical condition carries out repetitive lifting tasks with a bent back, not thinking about the risk of injury.  A worker performs work in the yard during low light conditions without wearing high visibility apparel, thinking they can be seen by drivers.  A supervisor fails to train staff during the busy season because the company prioritizes speed and productivity over safety.

Don’t let an injury be a reminder of risk. Continuously communicate risks in a way that workers, supervisors, and managers can relate to. Remind everyone what’s at stake when health and safety procedures are not followed.

30

30-32_IL_Dec23_Safety_First.indd 30

NORM KRAMER, CRSP, P.MM, provides expert, in-depth health and safety consulting services for WSPS as a Warehouse Specialist in the GTA region.

HAMISH MORGAN, B.Sc (Honours), is Consulting Services Manager for WSPS.

The real-life consequences of low risk perception in the scenarios above include:  A crush injury because a worker in a hurry walked behind a lift truck just as the operator reverses.  Product falling on a worker as a result of a pallet getting bumped from behind when another pallet is placed on a rack.  A debilitating back injury for the healthy worker who repeatedly lifts with awkward posture, such as bent back.  Struck-by injuries for workers in the yard who are not wearing high visibility apparel.  High injury stats in an area of the warehouse due to inadequate safety communications by a supervisor.

Communicating risk

Here are six tips for preventing low risk perception and keeping health and safety top of mind among your workforce.

1. Regularly communicate the potential outcomes of an incident through internal campaigns, videos, and meeting discussions. Go beyond what the injury would look like. Show how this type of injury would impact a person’s family and daily life.

2. Ensure workers who perform the task and supervisor participate in risk assessments. Thinking about what could happen and how it could happen will help

keep risks top of mind and help everyone develop an understanding of why certain procedures are so important.

3. Embed risk information in training. It’s not enough to explain how to complete a task safely. People want to understand why. Include information about past injuries and near misses, and how procedures have been adapted as a result.

5. Invite your workers or perhaps a guest speaker to share their story. If one of your workers has suffered a loss at work, respectfully inquire if the worker is comfortable telling their story to their co-workers. If so, they can share how a life-altering workplace injury, occupational disease, or work-related fatality has impacted their families. When people hear about an actual event and how lives were affected, it leaves a lasting impression about the consequences of not taking health and safety precautions.

5. Include supervisors and managers in your campaigns and communications about risks. Harness the internal responsibility system (IRS) by making sure all workplace parties have a clear understanding of the hazards in your warehouse. With an established IRS, people will hold each other accountable for following health and safety procedures. When managers and supervisors understand the potential outcomes, they are less likely to look the other way when safety procedures are ignored. Remember, your supervisors must be competent to identify and control hazards so that the workers they supervise do not get injured.

6. Set the tone. Staff will take cues from leadership. If safety is prioritized it will be evident in the workplace culture and part of regular discussion. For example, if safety footwear and high visibility clothing is required in the warehouse, the executive team including the CEO must set the example.

INSIDE Logistics DE C E MB E R 2023

2023-11-27 7:12:42 PM

30-32_IL_Dec23_Safety_First.indd 31

2023-11-27 7:12:42 PM

Strong foundations.

Smart evolution.

Consumers are shopping differently.

Are you ready?

Meet your partner in facilities evolution.

C A L G A RY

OAKVILLE

The way consumers purchase goods has changed. That’s led

D A RT M O U T H

O T TAWA

to a drastic shift in the demands on your facilities. At Konstant,

E D M O N TO N

TO R O N TO

M O N C TON

VA N C O U V E R

MONTREAL

VA U G H A N

we’ve changed, too. We’ve evolved to offer a full range of storage, distribution and fulfillment services. So you can connect more deeply with each customer and deliver the value that sets your business apart.

www.konstant.com | 1-866-202-0064

30-32_IL_Dec23_Safety_First.indd 32

130890_Konstant_Insider-Logistics_Print_ad.indd 1

Complete Storage System Solutions

2023-11-27 7:12:42 PM

2023-05-25 11:27 AM