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COVER STORY ORY Y FAW Trucks cks – Supporting ing a 116-year ear success story ory
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IN THE HOT SE AT
C lette We Col ssels, Imp eria Developme nt – Reducin l Logistics Training and g the logistic s skills gap ISSN 1684-79 46 Novemb P10 er/Dece ISSN mber 1684-79 2014 Vol.Mar/Apr 46 12 No. 2013 6 / R50.00 Vol. 11 incl. VAT No. 2 / R40.00
REGULARS
FUEL
Editor’s Comment Go back to basics and save lives FESARTA Closer cooperation is needed for overloading Cover Story FAW – Ross Demolition’s 116-year success Regional News
2 5 6 8
Game-changing innovation in the fuel industry
HOT H SEAT S
Colette Wessels Imperial Logistics Training and Development executive
P10
FMCG transport Recognising SA’s Truck Driver of the Year
Future of connected fleets Challenges and opportunities
22 23 25 29 30
CORRIDORS 32
NTBs still a big problem
LAW 12
Legal implications of a truck accident
PORTS Terminal plays pivotal role in Cape economy
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Road Transport Management System Real-time communication Finance company established Putting driver’s health first
COMMERCIAL VEHICLES 18 18 19
Future Truck launched Assembly plant opens Refurbished Kempston Road plant revealed
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R650 million fuel storage facility
34 36
GOODS IN TRANSIT Cargo insurance vital
37
TRAINING Strategic logistics investment
38
DRUGS Testing drivers for drugs
39
AIR CARGO 20
Transporter insurance – the hazard warnings
12
21
LOGISTICS
Dealing with peak transport operations
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TWA | Nov/Dec 2014
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EDITOR’S COMMENT
Go back to basics and save lives
Publisher Elizabeth Shorten Editor Simon Foulds • simon@3smedia.co.za Head of design Hayley Mendelow Senior designer Frédérick Danton Designer Kirsty Galloway Contributors Barney Curtis, Andrew Evans, Rhys Evans
H
Editor in action
opefully the recent tragic accident on the N12 near Alberton will make everyone sit up and start acting positively. Over the years there have been many studies to ascertain how and why we have so much carnage on our roads. But not much seems to come from them. In an ideal world all drivers and operators need to go back to basics and stick to the rules of the road. That is my theory, but we all know that it is not going to happen. It is scary how many car drivers do not realise that a fully laden truck needs more distance to slow down. Maybe one aspect that needs to be driven home to car drivers is that every time they cut in front of a truck they are literally playing Russian roulette with not only their lives but also those around them. The law needs to hold companies liable as well. After all, it is they who place that driver behind the wheel of the truck. Both driver and owner should ensure the truck is roadworthy before leaving the yard. This needs to be drilled into every driver and operator. If not then the full wrath of the law should take its course. Courtesy, politeness and respect for the law of the roads will ensure we cut the carnage down. It is up to everyone to play their part. If we do, the roads will be a safer, more enjoyable place to drive. In this issue we find out what the law says about who should be held responsible in the event of an unroadworthy truck causing an accident. We look at considering implementing the RTMS ethics into your transport operation and at improving FMCG delivery operations. Find out more about the terminal port at Cape Town, the new fuel terminal there, and what Africa should be doing to grow its economy and on the logistics side when dealing with peak transport operations in the fourth quarter. As always, a varied read. Enjoy!
Simon Foulds
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TWA | Nov/Dec 2014
& Mario Landman Chief sub-editor Tristan Snijders Sub-editor Beatrix Knopjes Client services & production manager Antois-Leigh Botma Production coordinator Jacqueline Modise Marketing manager Hestelle Robinson Digital manager Esther Louw Distribution manager Nomsa Masina Distribution coordinator Asha Pursotham Financial manager Andrew Lobban Administrator Tonya Hebenton Printers United Litho JHB • t +27 (0)11 402 0571 Advertising sales Hanlie Fintelman • h.fintelman@lantic.net t +27 (0)12 543 2564
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PAGE STRAP
FESARTA COMMENT
by Barney Curtis, chief executive officer, FESARTA
Closer cooperation is needed for overloading Prior to the load charter for operators along the Northern Corridor being launched at a workshop on load limits and overloading control in Kampala, Uganda, FESARTA requested the scope of discussions to be expanded.
O
UR REQUEST WAS to include a discussion on the self-regulation system (RTMS) as adopted in South Africa, plus other outstanding issues in load limits and load control within the East and Southern African regions. This was agreed upon and I attended this event hosted by the Trade and Transport Authority of the Northern Corridor courtesy of the sub-Saharan Africa Transport Policy Programme.
The Vehicle Load Control Charter The contents of this charter were predominantly focused on the Kenyan transport sector. In Kenya, 95% of all goods are moved by road. It was accepted by all the relevant parties in Kenya. Unfortunately no fruitful discussions were held with the developers of this charter regarding the RTMS in South Africa. This is, in my opinion, a missed opportunity. This is not to say the charter is inferior to the RTMS, but I believe there should have been closer cooperation between the two systems to agree on the best options applicable to both regions. Unlike the RTMS, this load charter did not include: • standards to which consignors, transporters and consignees had to comply • compulsory auditing of transporters by professional auditors (at accreditation and on an annual basis) • a national steering committee.
It was also suggested that transporters who signed the Vehicle Load Control Charter should be members of a relevant transport association within their country. Uganda is also looking at adopting this particular charter and discussions have started with the country’s government in this regard.
Standard in East Africa The relevant national road transport associations in the region have also called on the East African countries to adopt this charter. It is my understanding that all the relevant transport associations are studying the contents in order to discuss it with their relevant members. For this to be possible it will have to be overseen by the Trade and Transport Authority of the Northern Corridor. FESARTA recommended that there also be closer cooperation between the developers of the charter and the RTMS going forward because both systems can benefit from constructive feedback and dialogue.
TWA | Nov/Dec 2014
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COVER STORY
FAW TRUCKS
Ross Demolition’s 116-year success
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TWA | Nov/Dec 2014
COVER STORY
”Survival of the fittest through business acumen, keeping your promises and a resilient attitude manifested by every employee – that’s the recipe for success.“
T
HIS IS THE message from a company that has been going strong for 116 years. Ross Demolition, headquartered in Cape Town, has prospered and survived many tough economic times spanning four generations of a family of engineers. All of them have been dedicated businessmen with not only a belief in inspirational leadership, but also in strong fiscal discipline, commitment and honesty. Since it was established in 1898 by Henry T Ross, the Ross Demolition group has followed a consistent motto: ‘On time, every time’. They also don’t shy away from any opportunity, as they maintain that no job is too big or too small. At present, Robert Ross and his son, John Ross, manage the family-owned business, which engages in contract demolition work across the whole of South Africa and subSaharan Africa, on a contract basis. While this is only one of six ‘arms’ of their business operations, it – like the other five divisions – depends heavily on a competent and efficient fleet of trucks to ensure all projects remain profitable, and continue to uphold their irrefutable reputation for delivering on their promises. This is why their fleet of FAW vehicles, mainly extra-heavy tipper trucks, is integral to their success. The FAW reputation for durability and efficiency matches that of Ross Demolition. “Our first FAW trucks to join the RD fleet were purchased to specifically service contracts in Africa where uncomplicated, easy-to-drive/maintain trucks were the main criteria for getting our excavation contracts done with minimum downtime,” explains Robert. “At present, we operate 28 FAW units, mostly the proven and robust 28.280FD tippers. I am very happy with the operational efficiencies that we are getting. In most cases, we are realising superb fuel consumption at 2.3 litres to 2.8 litres per kilometre. “Working in difficult and dusty uneven terrain, steep gradients on- and off-site, and moving heavy payloads, we opted for a shorter wheelbase configuration and a 400 litre fuel tank adjustment. The Euro II Weichai WD 615.50 engines give us a respectable 206 Kw with an effective torque of 1 160 Nm to pull payloads, some beyond the prescribed 12-tonne parameter. “The FAW trucks have succeeded admirably in all our initial trials. The first units coped beyond our expectations and, as a result, we’ve deployed them on all our operations locally and cross border, from confined inner-city projects to distant mass excavation sites.” Ross Demolition also provides the construction industry with mine rehabilitation, plant hire, tricky asbestos removal and earthmoving services. However, one of the most rewarding undertakings to have emerged over the last years, is the
material recycling business done by Ross Demolition. “In every site we clear, we recycle 98% of all the materials used – bricks, wood, windows, steel, glass, roof trusses – you name it, we recover it and resell this to the ‘secondary’ construction tier who are desperate for affordable, good second-hand material. We have five depots from where this recycled material is sold. It’s great to know we are contributing to preserving resources and the environment, and helping other entrepreneurs make a decent living in the construction industry,” says Robert. Robert Ross recalls some of the most amazing projects undertaken by Ross Demolition. “We’ve imploded the Athlone Cooling Towers, as well as the largest building ever in Cape Town, which always has great spectator value. One of the most challenging projects was working against the clock when we had to demolish the Valkenburg Bridge within a total time frame of only eight hours. Beginning at midnight, by 08:00 we had completely dismantled the bridge, removed all the debris and cleared the site so that traffic on the N2 route could resume in the morning. “Another remarkable project was the Portside 101 Project; the deepest excavation project ever undertaken in Cape Town. The Portside 101 Project covered a full city block on the foreshore and required 90 000 cubic metres of rock to be blasted out and removed from the site. The site was commissioned for a 32-storey building, 142 metres high, which today stands proudly as the tallest building in the Cape Town CBD.” “Our fleet of FAW trucks is efficient, robust and reliable. Our drivers are well trained. We employ sound fleet management systems, like trackers, and so on, to monitor and ensure we get the necessary performance to maintain our margins,” explains John. “With the recessionary times and the pressures prevailing in the construction industry, competition is fierce and margins are tight. We need our fleet to run at the highest uptime rate possible with the minimum of problems in vehicle maintenance and service requirements. Our FAW fleet stays on the road, is not demanding in its simplicity of operation and is particularly great for our bottom line with its low maintenance costs and minimum downtime. These benefits are crucial to our profit margins,” concludes Robert.
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TWA | Nov/Dec 2014
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REGIONAL NEWS
Read more on www.transportworldafrica.co.za
SOUTH AFRICA
R24 billion 10-year deal signed with Transnet
A 10-YEAR CONTRACT for transporting coal on rail has been signed between Transnet and the South African coal unit of mining company BHP Billiton. This agreement makes the Australia-based miner the first major customer to commit to a long-term take-or-pay contract with the South African state-owned freight transport company. It is also a massive boost for certainty around Transnet’s capacity expansion programmes on the export coal line. Transnet is adding close to 10 million tonnes in capacity on the line from the current 73 million to 81 million tonnes, over the next seven years. The agreement with BHP equates to a contract value of approximately R2.4 billion per annum and R24 billion over the 10-year period. Take or pay contracts are crucial to Transnet’s capital investment programme as they provide revenue certainty – a key consideration for raising funds in the capital markets. Take or pay contracts mean that Transnet commits to providing trains and a customer is obliged to pay whether they have product or not. Crucially, the long-term contracts provide a massive boost to South Africa’s credentials as an investment destination, as they confirm the mining sector’s confidence in the country. For Transnet, this is an indication of strengthening relations with customers, particularly with regards to partnering on future plans. BHP is one of Transnet’s and South Africa’s largest coal exporters. Transnet is confident that agreements with the remaining 28 customers will be formalised by the end of November this year. Transnet has been in negotiations with the industry over the last 20 months and most customers have agreed to the terms. All exporters moving through the Richards Bay Coal Terminal (RBCT) will sign individual contracts of 10 contract years, commencing on 1 April 2014 and terminating on 31 March 2024. Transnet Freight Rail has committed to moving 810 million tonnes of coal over the period, including a performance guarantee.
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SOUTHERN AFRICA
Smooth flow of cargo THE MAPUTO CORRIDOR Joint Operating Centre (JOC) has been officially launched by Transnet and port and rail operators in Swaziland and Mozambique. The centre is a major milestone for the three countries in their drive to provide a seamless flow of cargo services to their customers. The JOC enables Transnet, through its rail freight division, Transnet Freight Rail, Mozambique rail and port operators respectively, Caminhos de Ferro de Moçambique and Maputo Port Development Corporation and Swaziland Railway to establish common operating and maintenance philosophies. These efforts are aimed at enhancing operational efficiencies on the freight corridor, which runs from Mpumalanga in South Africa through Swaziland to the Port of Richard’s Bay and the Port of Maputo in Mozambique. The JOC houses representatives from all four partners under one roof, focusing on the integration of planning and operations, and managing all cross-border operations and stakeholders. The JOC has already realised significant efficiency gains. These include an impressive 24% reduction in dwell time at Komatiepoort, and an unprecedented 57% reduction in dwell time at the ports in Maputo. In the JOC’s first year of operation, Freight Rail’s volumes to Mozambique grew from 2.6 mtpa to 4.5 mtpa.
EAST AFRICA
Creating 2 346 jobs and generating $78.38 million in first year
THE EXPORT PROCESSING Zone (EPZ) in Tanzania continues generating revenue and creating jobs for the region with another 13 new local and foreign companies being allowed to start businesses within its Special Economic Zones. Dr Adelhelm Meru, the Economic Processing Zone Authority director-general, says: “Once these new companies start operations, about 2 346 jobs will be created and $78.35 million will be generated in the first year.” Over the last five years, the country has generated $450 million net profit from goods exported from the country’s EPZ. Since these were established within Tanzania, over $700 million has been invested in the country in the process creating 14 000 direct jobs. The EPZ scheme became operational in 2002 when Tanzania set aside 16 150 hectares of land for the development of Special Economic Zones in three of its cities in an attempt to attract foreign investment.
REGIONAL NEWS
SOUTH AFRICA
Accelerating owner-driver projects THE LATEST PHASE in an innovative scheme giving drivers ownership of a business, while realising a company’s enterprise development objectives, is bearing fruit. Adcock Ingram Critical Care recently handed owner-drivers the keys to their vehicles enabling them to distribute Adcock Ingram products along allocated territories. The company has empowered the drivers through training in various standard operating procedures, new logistics technologies and business management skills, to ensure these new entrepreneurs get the best shot at business success. Adcock Ingram Critical Care is a major supplier of life-saving medicines to hospitals and all the vehicles are branded with messages and images relating to the Critical Care mission and range of products. Tobie Krige, head: Logistics at Adcock Ingram says: “Due to the nature of the products produced by the Critical Care facility, distribution takes place directly from the Aeroton site. I am passionate about this programme and have seen how it changes the lives of the new business owners.” The launch of this Critical Care fleet of 17 vehicles augments an existing fleet of 25 vehicles, with owner-drivers already delivering the Adcock Ingram range of products from the main distribution points in Midrand, Cape Town and Bloemfontein.
Meshack Matswi, one of the first-phase and now established owner-drivers, talks about his experiences and the value of being a director: “This is a serious business and the opportunity to be a business owner and employer most certainly has its rewards. I have been able to grant my youngest son his greatest wish and that is to train as a professional soccer player through the Brazilian Soccer School Academy. Without this opportunity offered by Adcock Ingram, I would not have been in the financial position to do this.” Krige states “We believe in adding value to life and are committed to helping combat unemployment. There is a great entrepreneurial spirit shared by our owner-drivers and it is amazing to see how much dedication and effort people can put into something when given the chance.”
SOUTHERN AFRICA
Processing 50 million tonnes of cargo by 2020 THE CARGO PROCESSING capacity at the Port of Maputo will increase from 40 million to 50 million tonnes by 2020. This is according to Osorio Sales Lucas, president of the Maputo Port Development Company (MPDC), who was speaking at the launch of the Joint Operation Centre (JOC) of the Maputo Corridor. Three new docks will also be constructed along with dredging to increase the depth of the port from its current 11 m to 14 m, enabling larger draft vessels to moor at the port. Lucas says: “A tender will be announced in the coming months to ensure that new dredging operations are carried out by a company with capacity to carry out the work. Meanwhile Italeni, Transnet Freight and Rail’s new dredger, is due to arrive in Maputo for maintenance dredging. “Portos e Caminhos de Ferro de Moçambique also plans to invest $1 million in infrastructure and rolling stock to allow most of the cargo sent to the Port of Maputo to arrive by rail, rather than by road as is currently the case.” The MPDC, a partnership that includes South Africa’s Grindrod and DP World of the United Arab Emirates as its main shareholders, handled 17 million tonnes of cargo in 2013 and is expected to increase this to 19 million tonnes this year. The JOC – which has been in operation since 2013 – coordinates the operations of Transnet Freight Rail, CFM, Swaziland Railway and the MPDC.
EAST AFRICA
$100 million invested in upgrading one-stop border posts IN SPEARHEADING trade integration across East Africa, Trademark East Africa has invested $100 million in upgrading the one-stop border posts within the region. This will ease cross-border trade and improve business competitiveness by reducing the time spent to clear cargo in transit. So far, construction at the Holili-Taveta one-stop border post at the Kenya-Tanzania border is complete, paving the way for controls that will save time and money for traders ferrying goods into northern Tanzania. It is expected to be officially opened in 2015. States Frank Matsaert, CEO at Trademark East Africa: “We are already working on the Busia and Malaba border posts to upgrade the facilities, as well as working towards improving the management of work processes and eventually easing transit times in East Africa.”
TWA | Nov/Dec 2014
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HOT SEAT
IMPERIAL LOGISTICS
Reducing the logistics skills gap Skills training is an important aspect of growth within a company, as well as for growing the economy. In this issue’s Hot Seat, we put Imperial Logistics Training and Development executive Colette Wessels on the spot about the importance of skills development and the initiatives being taken at Imperial Logistics. In your experience, has the skills gap broadened? Research and experience indicates that it has not changed much, entry/operational level skills are relatively easy to obtain, however the talent challenge remains at senior and executive management level. This is due to technical competence being relatively easy to attain, and a number of managers lack the leadership and strategic ability for transition to senior/ executive level. Transformation remains a challenge in the traditional ‘crucial and scarce’ skills categories, such as engineering and IT programming/ architecture development. The well-published problem within the education system in South Africa does not help in alleviating the skills problem. The bureaucracy and other challenges, such as resources, entrenched in the processes of sector education and training authorities often limit the efficiency of these bodies in addressing skills development in certain sectors.
What measurements are taken to minimise the skills gap? Industry level: bursary schemes are available in the fields of logistics and supply chain management together with selected commercial
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disciplines. Workplace experience programmes are available to young graduates. A partnership with educational institutions and professional bodies supports staff in promoting their careers. Company level: we have developed numerous customised leadership programmes to build technical and general managerial competence. Internal and external short courses are facilitated for professional development.
educational promotes added opportunities. It is important that both the private sector and industry partners do more to profile logistics and transport sectors at school level. An initiative such as the Road Freight Bargaining Council is an informative and valuable expedition. The Transport Education and Training Authority drafted a career guide for the sector.
Are there sufficient industry training options and how does the company take advantage of these? Over and beyond
How has training and development evolved at Imperial Logistics? When
our internal programmes, we have partnered with numerous private and public education institutions and training providers. These include universities, FET colleges, professional bodies such as SAPICS, ECSA and CIMA, as well as other private providers. Additionally, we leverage grants to fund skills development in maintaining close relations with the relevant sectors in education and training authorities.
Are there any current opportunities in pursuing a career in transport? Opportunities have grown remarkably in this industry. Our assistance in offering tertiary
we recognised the need to move to the next level and establish an accredited in-house training facility to upskill our people, the Imperial Logistics Academy was born. The academy provides customised, integrated training and development programmes
that are aligned with national qualifications, as well as practical short courses to address specific skills development and career advancement needs.
What about training in the rest of Africa? In line with Imperial Logistics’ vision to expand its African footprint, the Imperial Logistics Academy is affiliated with the Imperial Health Sciences Supply Chain Academy, one of Africa’s leading providers of training and development for people working in the continent’s public health supply chain. As Imperial Academy’s African partner, it offers training and skills development beyond South Africa’s borders, to health and logistics practitioners in public health facilities, government health departments and private logistics companies.
HOT SEAT
IMPERIAL LOGISTICS
Academy boosts supply chain skills Reflecting its commitment to addressing South Africa’s critical skills shortage, logistics and supply chain leader Imperial has launched the Imperial Logistics Academy.
T
HE ACADEMY IS THE natural next step in the evolution of the group’s education and development efforts, comments chief executive officer Marius Swanepoel. “Imperial has always strived to be an employer of choice as well as a learning organisation, so we’re not new to training. Our multifaceted learning and development framework has garnered numerous accolades and awards over the years, including the SAPICS Corporate Educator of the Year award and the South African Graduate Recruiters Association’s Graduate Employer of Choice award. We recognised the need to move to the next level and establish an accredited inhouse training facility to upskill our people, so the Imperial Logistics Academy was born,” he explains. The academy provides customised, integrated training and development programmes aligned with national qualifications, as well as practical short courses to address specific skills development and career advancement needs. “In addition, the academy enables graduates to enter the supply chain and logistics industry through graduate development and learnership programmes,” Swanepoel expands. “A dedicated graduate development manager engages with further and higher education institutions on a continuous basis to reach graduates around the country. Guest lecturing is offered, and the academy also participates in career days, to maintain a close relationship with higher and further education institutions. A key strategy is
to build a pipeline of graduates, to feed into the Imperial Logistics internships and bursary schemes,” he states. All training is customised to reflect the Imperial approach and encompass Imperial Logistics’ best practice. “Subject matter expertise drawn from within the organisation enhances the training programmes,” Swanepoel notes. “Skilled Imperial Logistics people contribute to content development and offer guest lecturing and mentorship. This means that skills are transferred both internally within the group and externally, to develop the broader supply chain industry.” In line with Imperial Logistics’ vision to expand its African footprint, the Imperial Logistics Academy is affiliated with the Imperial Health Sciences Supply Chain Academy, which is one of Africa’s leading providers of training and development for people working in the continent’s public health supply chain. “As the Imperial Logistics Academy’s African partner, it offers training and skills development beyond South Africa’s borders, to health and logistics practitioners in public health facilities, government health departments and private logistics companies,” says Swanepoel. Also complementing the Imperial Logistics Academy’s offerings is its collaboration with Ikaheng HR Services, a group company that focuses on operator and legal compliance training. The Imperial Logistics Academy also aims to drive industry cooperation, partnerships and knowledge sharing. The Academy is closely affiliated with the Transport Education and Training Authority, as well as other leading industry associations, such as the Road Freight Association, SAPICS and CIMA. “At Imperial Logistics, we believe that the right solutions and services are meaningless without skilled people to adopt, implement and support them. Through the Imperial Logistics Academy, we aim to get the best from our people and help them get ahead, as well as advancing the supply chain and logistics industry as a whole,” he concludes.
TWA | Nov/Dec 2014
11
LAW
Legal implications of a truck accident The horrific accident on the N12 near Alberton in October was described by Ismail Vadi, MEC for Transport in Gauteng, as looking like the aftermath of a bomb explosion.
T Alta Swanepoel, manager at Alta Swanepoel and Associates
HE DRIVER WAS arrested shortly after the accident and Minister of Transport Dipuo Peters also called for the truck owner to be arrested. This has raised questions about what the law says about who should ultimately be held responsible and prosecuted: the driver or the owner of the vehicle? At the same time what should a driver do if he realises the vehicle is unroadworthy? TWA speaks to Alta Swanepoel, from Alta Swanepoel and Associates, who specialises in the field of road traffic and transport legislation and does training for both traffic officials and the transport industry. Swanepoel says: “The Act makes both the driver and operator (owner of certain vehicles) responsible. This is explained in Section 45, Regulation 265 and Section 49. “Section 50 of the Act gives the MEC for Transport power to suspend vehicles and Section 51 places a burden of proof on the operator to show he has done everything reasonable to comply with legislation.” Should a driver realise the vehicle is unroadworthy during a pre-trip inspection, what can he do, especially if he fears losing his job? “He should inform the operator immediately because if the driver causes an accident in the unroadworthy vehicle, he is considered guilty. An employer may not force an employee to do something criminal. “A driver cannot be technically fired for refusing to drive an unroadworthy vehicle because he is not doing something that warrants a dismissal.
“It is very risky for truck operators who do not maintain their vehicles, as they are ultimately responsible both criminally and civilly. Section 89 of the Act makes it an offence to not comply with the law regarding unroadworthy vehicles.” What follows are some of the relevant sections from the National Road Traffic Act 93 of 1996 operators and CEOs should take note of:
Section 49: Duties of the operator The operator of a motor vehicle shall: (C) Exercise proper control over the driver of such motor vehicle to ensure the compliance by such driver with all the relevant provisions of this Act, in particular the provisions regarding: (i) the requirements in respect of the professional driving permit referred to in Section 32 (ii) the loading of such vehicle as prescribed by or under this Act. (D) Ensure that such motor vehicle complies with the fitness requirements contemplated in Chapter V. (E) Conduct his or her operations with due care to the safety of the public. (F) If dangerous goods or substances are conveyed, ensure that all requirements for the conveyance of such goods or substances, as prescribed in: (i) any other law in relation to such goods or substances; and (ii) this Act. (G) Take all reasonable measures to ensure that such motor vehicle is operated on a public road in compliance with the provisions for the loading and transportation of goods as prescribed by or under this Act.
Section 50: Power of CEO in respect of motor vehicles, drivers and activities of operators 1. The chief executive officer concerned may, on account of any evidence regarding the state of fitness of a motor vehicle in respect of which an operator is registered, produced to him or her in accordance with Subsection (4), by written notice: (A) Notify such operator that such motor vehicle is suspected of being unroadworthy and that the operator should forthwith take adequate steps to ensure its continued roadworthiness in accordance with Chapter V.
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LAW
(B) Require from such operator to indicate in writing what precautions he or she has taken to ensure the continued roadworthiness of such motor vehicle in accordance with Chapter V. (C) Direct such operator to produce such motor vehicle for inspection, examination or testing at a time and place specified in such notice. (D) Suspend the operator card issued in respect of such motor vehicle, if such motor vehicle has been examined or tested under paragraph (c) and found to be unroadworthy in terms of Chapter V, for such period as such motor vehicle is so unroadworthy. 2. The chief executive officer concerned may, on account of the record of a driver of a motor vehicle in respect of which an operator is registered, by written notice: (A) Inform such operator that it is suspected that he or she does not exercise proper control over the driver under his or her authority as required by Section 49. (B) Require such operator to indicate in writing what precautions he or she has taken in order to ensure proper control over drivers under his or her authority. (C) Require such operator to produce for examination the records regarding drivers which an operator is required to keep in terms of this Act. (D) Direct that the driver concerned be retested in terms of Section 25. 3. The chief executive officer concerned may, if the record of an operator indicates that such operator does not comply with the provisions of this Act, by written notice: (A) Direct such operator to carry out his or her duties in terms of Section 49 properly. (B) Appoint a person whom he or she deems fit, to investigate the activities or specific activities of such operator and direct the person so appointed to make a written recommendation to him or her regarding what measures should be taken in respect of such operator. (C) Direct such operator to appear before him or her or before any other person appointed by him or her, in order to furnish reasons for his or her failure to carry out his or her duties in terms of Section 49 (D) notify such operator: • that an operator card shall only be issued to him or her on such conditions as the chief executive officer may deem fit
• that no further operator card shall be issued to him or her for such period as the chief executive officer may specify in the notice • that the operator card or cards relating to such motor vehicle or vehicles as the chief executive officer may determine in respect of which he or she is registered as the operator is or are suspended until that chief executive officer is satisfied that the grounds for the suspension have lapsed. Provided that: (AA) The period of any suspension under subparagraph (iii) shall not exceed 12 months. (BB) Any decision by the chief executive officer under this paragraph shall only be taken on the basis of a recommendation by a person appointed under paragraph (B). (CC) The chief executive officer shall, within 21 days after the date of the notice, in writing furnish such operator with the reasons for his or her decision.
One of the countless accidents on our highways
Section 51: Act or omission of manager, agent or employee of operator 1. Whenever any manager, agent or employee of an operator commits or omits an Act which would have constituted an offence in terms of this Act if the operator had committed or omitted such Act, that operator shall, in the absence of evidence that: (A) He or she did not connive at or permit such Act or omission. (B) He or she took all reasonable measures to prevent an Act or omission of the nature concerned. (C) That an Act or omission of the nature of the Act or omission charged did not fall within the scope of the authority of or the course of the employment as such manager, agent or employee, be deemed himself or herself to have committed or omitted that Act and be liable to be convicted and sentenced in respect thereof. 2. Whenever any manager, agent or employee of an operator commits or omits any Act which would have constituted an offence in terms of this Act if such operator had committed or omitted it, such manager, agent or employee shall be liable to be convicted and sentenced in respect thereof as if he or she were such operator. The Adjustment of Fines Act equals one year imprisonment to R40 000 = Max fine therefore 6 x R40 000 = R240 000.
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FLEET MANAGEMENT
Road Transport Management System Following the recent truck accident on the N12 near Alberton, Simon Foulds speaks to Road Transport Management System chairman Adrian van Tonder to find out why it is important for transport companies, irrespective of size, to implement the system.
R Adrian van Tonder, chairman of RTMS
TMS IS AN industry-led, voluntary self-regulation scheme that encourages consignees, consignors and transport operators engaged in the road logistics value chain to implement a vehicle management system that preserves road infrastructure, improves road safety and increases the productivity of the logistics value chain. In practice, there are two arms to the RTMS initiative, namely: industry participation and specific operator participation. Industry participation includes proactive industries such as the South African sugar industry, which has embraced the RTMS principles and diligently managed their logistics with some really impressive results for over seven years now. The South African Sugar Association has seen an 86% reduction in incidence of overloads across a massive 20 million tonnes of product moved per annum. Van Tonder says, “It would be so good to see more industries embracing this approach. Operator participation is voluntary and any transporter, consignee or consignor can elect to implement the RTMS standards within their organisation and be independently audited to gain and maintain their RTMS certification. To date, over 116 organisations have been accredited. “The RTMS standards are available from SABS and are specific for transporters, consignees, consignors. RTMS is a management system which insures that all your transport activities comply to all the required regulations. The RTMS initiative is gaining more and more support, for example in 2012 the project was awarded platinum at the National Logistics Achiever Awards. In KZN the local Department of Transport is in fact an active steering committee member and even sponsors some of the project giving it the muchneeded means to operate.”
Benefits of accreditation Van Tonder adds, “Other than the obvious advantage that it assists operators in doing the right thing, RTMS also assists industries and operators to be recognised as being committed to responsible business. Other examples of advantages are the that RTMS certified operators become eligible to apply to operate smart trucks
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(performance-based standards trucks) and even certain insurance premium concessions have been applied. Any transport company can join irrespective of its size.”
Process There are basically two routes an operator can follow: First: the operator buys the standard from SANS (ARP067-1) and works through it alone until all requirements are met. Second: done through a company called Crickmay which provides a consulting service in order to get an operator ready for a RTMS audit. Once the transporter is ready, an independent external RTMS auditor can be booked for a RTMS audit for certification.
Costs If an operator wants to go it alone, the costs are R335 for the standard plus the cost of the audit, which is in the region of R10 000. Van Tonder states, “This process typically takes anything from 6 to 12 months and in some cases is abandoned all together. “Otherwise, through using the Crickmay Consulting Model, it will cost an operator approximately R16 000. This typically shortens the time to get accredited to between three and five months and takes a load off of the operator.”
Small operations accreditation States Van Tonder: “Small operators can become very competitive due to an increasing number of contracts being awarded to RTMS certified operators. “Bigger operators often prioritise the use of a RTMS certified operator to subcontract work so as much of the responsibility as possible is already taken by the subcontractor.” Van Tonder concludes: “RTMS gives the operator better control over fleet and management of staff (maintenance, driver training and fatigue management). It creates a paper trail for complete business operations (e.g. accident investigation and court cases). “It proves they do what they say they do (no overloading, good maintenance, good working conditions).”
FLEET MANAGEMENT
Real-time communication If you are serious about monitoring your fleet while ensuring operating costs are kept at a minimum, then, as a Scania owner, the answer lies with the Scania Communicator.
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HIS DEVICE collects pertinent data from the truck as it is driven and transmits it to an interface, which then evaluates the data. Hereafter, an easy-to-understand spreadsheet is received weekly by the operator who knows at a glance which of his trucks is being driven and operated efficiently. Those vehicles not operating efficiently are flagged and from the report the operator knows exactly which areas need to be investigated. The operator can know in real time a range of information including whether the vehicle has a serious engine fault, worn brake linings, low oil and tyre pressure, whether there has been a change of driver and also if the vehicle has deviated from its designated route.
Advantages When purchasing a Scania truck, the Scania Communicator is installed free of charge and operators have a choice of two packages. The first is the monitoring package, which provides full fleet data on each vehicle and it is free to owners. The second is the control package, which, for a monthly fee, also includes map functionality in real time. The latter also includes international roaming for cross-border operations at no additional cost. With both packages, tools are provided to the operator for both driver and vehicle data analysis. This enables operators to get more skilled drivers because they can isolate bad driving habits and then provide drivers with the relevant training. At the same time, it also enables you to lower fuel costs and the truck’s environmental footprint. Because the hardware is fully integrated into the vehicle, operators are connected to their vehicles and are able to track and trace in real time.
Monitoring This package is easy to operate and no prior knowledge of fleet management is required. Scania will email the operator a weekly report on the previous seven days’ data of each truck to the operator on a Monday morning. A monthly report is also received showing a monthly overview and then at the end of the year an overview report is received. Operators receive 65 reports on their Scania vehicles each year. These reports are a basic fleet overview showing performance indicators and trends. Therefore it is easy for operators to find the right details so that they can start seeing which vehicles and drivers are using the most fuel and which are not. It thus
becomes easier to spot any deviations over a weekly or monthly period. The reports show specific vehicles’ performance broken down into key categories like idling and coasting.
Control If more detail is required, then the control package can be implemented. With this package, Scania operators can keep track of their vehicles 24/7. This also enables operators to verify what you are invoicing and to also prove to customers that you did make their deliveries on time. Drivers can be monitored so they do not exceed allowed driving time and you can get instant updates on vehicle location. Operators can analyse the routes taken by the drivers as well as set geographical zones. Should the vehicle then deviate from this geographical zone, the operator is notified immediately. The vehicle reports are also more detailed for each vehicle, ranging from fuel consumption to idling times per trip, whether the driver has exceeded the speeding limit, including harsh accelerations and harsh braking actions – which both increase fuel consumption. The report also rates the driver’s performance for that week giving them a score out of 100. Through this report, you can see whether driver targets are duly met and it is a great way to indicate details that matter. Often, details that matter when operating trucks are deviations from the normal. With the exceptions report – which is part of this package – operators are given the details quickly so these deviations can be dealt with almost immediately.
Scania operators can keep track of their vehicles 24/7
Trucks position Thanks to the map functionality, you can be in control of your fleet regarding driver usage. You also have an exact overview of your fleet’s position and each vehicle’s current status irrespective of whether it is driving, resting or loading. Another great feature of this package is that operators can click on the truck’s position on the map and get its GPS positioning, fuel level in percentage, odometer reading and so much more. Operators are now in complete control of their Scania, irrespective of whether it is in South Africa, Namibia, Zimbabwe or Mozambique – in real time via their PC or tablet and also receive all the relevant data weekly, monthly as well as an annual report. At any given stage, key pertinent data is literally at the operator’s finger tips.
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FLEET MANAGEMENT
Finance company established Babcock Financial Services has been established to provide finance for the purchase of DAF Trucks.
Wilna Steyn, CEO of Babcock’s Transport Solutions division
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ILNA STEYN, CEO of Babcock Africa’s Transport Solutions division, says, “This development has been long in the planning and the offer of financing will significantly boost sales of DAF trucks in the South African market. “This development will give us the competitive advantage of a full product offering against certain brands in this market – and allow us to compete on the same level with others. “When we took on the DAF brand four years ago, we became aware of the importance finance plays in the extra-heavy truck
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market. To address this issue, we initially entered into various joint ventures and partnerships with local banks to offer a solution to our customer base. However, these solutions did not fully meet all the requirements of our customers looking for an in-house finance solution. The establishment of Babcock Financial Services will now meet this need.” Steyn adds that, in addition to the recent renewal of Babcock’s DAF distribution contract for a further five years, this milestone development also demonstrated Babcock’s commitment to servicing and growing the DAF brand in this country. Within a very short period of time, Babcock finance has already enjoyed a huge take-up from customers from all parts of South Africa and Steyn predicts that this would grow very rapidly over the next 12 months. Babcock Financial Services currently has sufficient finance to cover more than a year’s sales and this will be steadily increased.
FLEET MANAGEMENT
Putting drivers’ health first With more than 80% of the country’s goods being transported via road, South Africa’s trucking industry currently forms the backbone of our economy. Simon Foulds sits down with Tersia Ströh, COO at the National Bargaining Council for the Road Freight and Logistics Industry (NBCRFLI) to find out how critical driver wellness is within the industry.
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HE MORE GOODS that are moved, the more our economy thrives. The opposite is also true – when goods are not transported, our economy suffers. Long-distance truck drivers lead a hard life, with prolonged periods of absence from home. Drivers lead a sedentary lifestyle, travelling for hours on end, and often exposed to high-risk behaviour and poor nutritional options. The nomadic lifestyle of a truck driver also means that it is very difficult for them to access conventional medical services in order to take care of their health. With the above in mind, it is important to ensure that the health and well-being of truck drivers is a priority for us as an industry.
Healthy driver Says Ströh, “Driving a truck is a highly demanding job with long hours and tight deadlines. It is also a highly responsible job as often cargo worth large sums of money is transported. Quick reflex action is also essential as anything can happen on the road and drivers need to be able to protect both themselves and other drivers on the road. Lastly, if drivers are not well and cannot transport goods around the country, our economy suffers.
Improvement “In order to ensure the well-being of our truck drivers, as well as South Africa’s economy, the National Bargaining Council for the Road Freight Industry launched Trucking Wellness in 1999. “Trucking Wellness (previously known as Trucking Against Aids) was launched to create awareness around HIV/Aids and sexually transmitted infections among long-distance truck drivers, commercial sex workers and those at risk such as driver spouses and partners. Over the years, the programme has evolved into providing a holistic approach to health and wellness, encompassing a wide range of free primary health-care services.
Education and training “The highly trained Trucking Wellness nurses and counsellors provide
education and training to drivers regarding HIV/Aids and sexually transmitted infections. Where necessary, they also provide counselling and emotional support. “Education and training is an effective tool to influence the health and wellness attitudes and behaviour of truck drivers. It equips drivers with the necessary information for them to make responsible decisions. The training is available to drivers whenever they visit a Trucking Wellness Clinic, a mobile clinic and at the Wellness Days. “It is important for transport operators to consider their employees’ health at all times and to communicate with their employees about the benefits of leading a healthy lifestyle, not only for themselves and their families, but for the economy too. A large part of this includes pointing their drivers to the tools available to them – the Wellness Centres and the Wellness Fund Health Plan.
Tersia Ströh, COO at NBCRFLI
Own wellness programmes “Truck operators can also look into introducing their own Wellness Programmes and Wellness Days within their organisations, encouraging their drivers to maintain healthy lifestyles. Should an operator wish the council to be present at their Wellness Day to inform employees about the various wellness services available to them, they should please contact us so that we can send our mobile office to the Wellness Day. “By building a health-conscious trucking industry, we help transport companies to operate at their optimum while also contributing to the overall safety on South African roads.” The NBCRFLI The NBCRFLI strives to combat the spread of HIV/Aids effectively: • by encouraging those who test HIVnegative to remain negative • by keeping those who test HIV-positive healthy and productive for as long as possible • by positively influencing attitudes to break down stigma surrounding the disease.
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COMMERCIAL VEHICLES
Future truck launched
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TEEPED IN A rich 52-year-old heritage associated with reliability and performance, the new Canter Lift continues to apply FUSO’s longstanding global branding to the future of transport technology in South Africa. Since its international launch, the latest FUSO Canter Lift made history by being the first commercial vehicle to receive the Automotive Researchers and Journalists Conference’s Car of the Year Special Award 2013. This was followed in Ireland by the accolade of Best Energy Efficient Product Award being bestowed on this impressive vehicle. Godfrey Hani, divisional manager for FUSO, speaking at the launch in Johannesburg, said, “Lift stands for ‘light-duty international future truck’ and this is indicative of our pioneering spirit of always moving forward for our customers and society. As we continuously refine the Canter so that it remains at the forefront of the truck
industry, we ensure that we do this with all our stakeholders. As the most extensively updated brand yet, the Canter offers newly developed drivetrains. Our FUSO designers and engineers put everything they know about powertrain technology and efficiency into the new Canter Lift. “This has resulted not only in a vast improvement on our previous models, but a vehicle that represents a new approach to the technology of transporting goods by truck.” FUSO’s new 4P10 twin-camshaft engine with four valves per cylinder, turbocharged and intercooled four-cylinder diesel engine is coupled to an advanced DUONIC six-speed, dual-clutch automated manual transmission – the only dualclutch transmission available in a commercial truck. “Wherever the new Canter Lift will be utilised – refrigerated delivery, bakery applications, butchery, general distribution, courier logistics or any other operation – this vehicle has been designed to provide tailor-made solutions.” Hani concludes: “Our new Canter Lift offering reflects the philosophy of our product values; very low operating costs, reliability and functionality, which emphasise that trucks should be built for maximum profitability potential.”
Assembly plant opens
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OLLOWING A MULTIMILLION rand investment in its Commercial Vehicles division, Hyundai Automotive South Africa officially opened its commercial vehicle assembly plant on the East Rand. Wade Griffin, director: Commercial Vehicles at Hyundai Automotive SA, says, “The opening of this assembly plant forms an ideal platform from which to strengthen our business strategy, both in terms of commercial market growth and sustainability, as well as an increasing commitment and investment in the South African economy. “We believe that there are strong opportunities through investment and local assembly to capitalise on for our business. This substantial investment will also help to improve local skills and create jobs in an economy that is in dire need of such opportunities.” The rationale behind the semi knocked down (SKD) assembly plant in Apex, the industrial area of Benoni, was largely driven by a long-term strategy to grow Hyundai’s share in the South African commercial vehicle market, to be more competitive and to increase Hyundai’s investment in the
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country’s economy. The initial aim is to produce 50 units a month, focusing specifically on the Hyundai HD65 and HD72 trucks. At this stage, most of the trucks produced in the plant will be distributed in the South African market, but Hyundai Automotive SA is investigating options to export to markets in the sub-Saharan region of Africa. Of the vehicles assembled in the Benoni plant, 20% will be exported to neighbouring Southern African countries such as Botswana and Namibia as part of the immediate plans. Hyundai Automotive SA established the factory by buying an existing plant from Imperial Holdings as part of a R110 million investment in the Commercial Vehicles division of Hyundai in South Africa. Griffen concludes, “We are obviously at an early stage in the development of the local operation, but we are already examining the expansion of locally produced parts for our assembly line. We chose the premises in Benoni for two reasons: there was an existing infrastructure and suitable buildings and storage areas to run such a plant, and it is situated in the economical hub of South Africa, Gauteng, where there is a big demand for products such as our HD65 and HD72 trucks.” An increase in local content of the vehicles that are assembled in the plant will bring further savings, a more competitive business model and create jobs in the local economy.
COMMERCIAL VEHICLES
Refurbished Kempston Road plant revealed The Eastern Cape is the home of Isuzu Trucks. And journalists visiting the company’s Kempston Road plant in Port Elizabeth recently were shown how, following a facelift, the plant has both increased production and boosted morale among employees.
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HE ASSEMBLY PLANT is ideally situated as Isuzu Trucks’ business focus includes the SADC region, and the other sub-Saharan regions of Africa. Craig Uren, Isuzu Trucks South Africa chief operations officer says: “With our current plant location we have access to a port, which makes transporting vehicles to the regions we view as key growth nodes much easier. “Our plant has undergone some radical changes in line with our global leadership philosophies, which are intrinsic to not only our brand but our heritage, too. One philosophy that has been used successfully in the plant in establishing optimal productivity is the use of Kaizen principles, which have increased the capacity of our workforce. The truck plant has undergone further changes since 2013 and Isuzu Trucks South Africa has taken responsibility for the truck assembly operation at Kempston Road.” While productivity has been optimised, the labour force has not been affected and no loss of employment has occurred. Uren adds, “What we have managed to achieve at the plant is decrease wasted time by increasing optimal working conditions, which benefits our employees. The plant currently employs 110 people, and with outputs increasing, this number is set to expand in the future. Our presence additionally enhances the local economy by employing people from the
Eastern Cape; this trickle-down economic effect supplements the local economy by creating more business and job opportunities.” Uren concludes: “As a business, Isuzu Trucks contributes to the downstream activities within the economy as well as the local economy, which forms a large base of our workforce at the plant. This means that although Isuzu Trucks may be in the vehicle industry, we contribute greatly to society. The main mode of transport in South Africa is road freight, and by ensuring that companies that purchase our vehicles are sustainable we ensure that people are employed throughout the supply chain, ranging from drivers to merchandisers, store controllers, distributors, etc.” The Kempston Road plant is over 44 000 m² and adheres to the standards ISO 9001 and ISO 14000; it assembles the N, F and FX series trucks and boasts an impressive safety and assembly record. Isuzu Trucks has its roots in Japan and dates back to the early 1900s. The Kempston Road plant opened in 1929 and currently has an output of 4 500 vehicles per annum, producing 20 units per day. TOP The NPR being assembled at the refurbished at the Kempston Road plant in Port Elizabeth
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INSURANCE
Transporter insurance – the hazard warnings By Steve Cornelius
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RANSPORTING GOODS throughout Africa is a massive industry – an industry that has very specific insurance requirements. All too often transporters are unaware of the pitfalls that could lead to their claims being repudiated. A recent study showed that in excess of 60% of trucks are not roadworthy – that translates into over 60% of claims relating to these trucks being repudiated or partial settlements being made. For any transporter, that figure should be a massive wake-up call. Road transporters and those who
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utilise their services must take responsibility for the issues that plague the industry, such as late loading and overloading. Late loading puts the drivers under pressure, forcing them to travel during unsafe hours (23:00 to 04:00) while overloading causes inconvenient delays at the weighbridge as goods are unpacked and repacked. Incentivising drivers to arrive at destinations earlier than scheduled encourages them to skip the necessary rest breaks and drive faster to make up time. It is not uncommon for drivers to work a straight 24-hour shift and the consequences can be catastrophic. No transporter can afford to be complacent when it comes to insurance. Buying insurance based purely on lower premiums or lower excess structures is the equivalent of tunnel vision. Don’t take chances when it comes to having the right insurance – there is simply too much riding on it.
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We don’t talk logistics solutions, we walk it Being able to deliver high-quality logistic and supply chain solutions requires having more than just a one-size-fits-all approach. At Cargo Carriers we pride ourselves on being customer centric and while vertical specific we are always looking for challenges and opportunities in new industries and regions. We strive for the highest levels of reliability in all that we move. With each customer comes an individual set of safety, health, environmental and quality requirements, and our innovative and service orientated offering means that we are consistently able to provide for your specific needs. Call us. We go the extra mile
Logistics Achiever Awards 2013
Innovative supply chain solutions
FUEL
Game-changing innovation in the fuel industry Sitanani Carriers, an empowered joint venture of Cargo Carriers and Caltex Mpumalanga North Marketers, is leading the field and driven by technology allowing for higher levels of safety and productivity.
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N THE FUEL transport industry, conventional thinking is that the only way innovation can ignite performance is through SHEQ and high safety standards; tankers can’t go faster and the cost of transport is what it is. Sitanani Carriers rose to the challenge with two first-tomarket innovations. The Sitanani fleet comprises newly designed, specialised trailing equipment. The tankers each have six compartments, each carrying a different type of fuel. Each compartment is fitted with its own electronic dipstick measuring system, which also includes a temperature compensation function. This gives Sitanani Carriers the flexibility to use the vehicle as a standard direct discharge vehicle or a metered vehicle. It also combines the various advantages of sealed parcel delivery (SPD) vehicles with the accuracy and security of a metered unit. These advantages include an increased flow rate of ±1 000 ℓ/min compared to conventional metered flow rates of between 300 ℓ/min and 500 ℓ/min, reduced probabilities of contaminations, reduced chance of overfills (which pose a very large safety hazard) and discharge flexibility. Because the tanker can discharge three compartments simultaneously, each at higher flow rates, delivery times are greatly improved, which in turn improves delivery performance and capital utilisation. Sitanani Carriers enquired with their tanker manufacturer (GRW Engineering) for a tanker that would suit the needs of the company in terms of improved theft monitoring, reduced turnaround time, improved load factor, reduced product contamination risk, improved delivery quantity measurement accuracy and improved safety. GRW proposed a solution that they believed would address the various challenges that Sitanani have encountered in their operation. This technology is new to South Africa and Sitanani was eager to be part of the trials for these vehicles and to be the first to test the new tanker. To arrive at this solution, GRW investigated and assessed all the various types of equipment and measuring and monitoring solutions available in the global market and concluded that the electronic dipstick system provided
the most visibility in terms of the fuel transport process. This relates directly to better control over the integrity of the load. GRW has partnered with BARTEC, who has developed this dipstick measurement technology, and now have a sole supply agreement to distribute this technology locally. With this new technology, every litre of fuel that is loaded into each of the tanker compartments is measured by temperature-compensated electronic dipstick meters on the tanker itself during the loading process and can be compared to the meter reading from the loading gantry to ensure complete accuracy and verification. The metering system on the tanker is also linked to a GPRS modem that sends all the data concerned with loading events, discharge events and valve position monitoring to the administration office for processing and monitoring by management personnel. Before this technology was installed, the only proof of actual product volume loaded was the load sheet provided by the third-party depot operator. In the absence of a second independent verification, it was very difficult to pinpoint a reason for loss of product. “This is new technology on the market, and Sitanani Carriers are the first to equip their vehicles with this technology locally,” says Piet Potgieter, technical manager at Cargo Carriers. “This, along with the SPD tankers, means that we can increase flexibility, decrease delivery time, and reduce loss of product due to theft or fraud, increasing our productivity,” says Tom le Roux, managing director of Caltex Mpumalanga North Marketers.
Cargo Carriers provides innovative fuel supply chain solutions
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LOGISTICS
FMCG transport Francois van Rensburg from Barloworld Transport tells Simon Foulds what FMCG operators should be doing to optimise their business operations.
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HE CONSTANT evolution of distribution channels and the sheer speed of change are forcing companies to rethink their operating and business models. It is imperative to be able to provide distribution solutions that are agile, flexible and responsive to counter such uncertainty and volatility. This often entails thinking outside the box and engaging with players across the supply chain. With the cost of transportation making up over 60% of the total logistics cost in South Africa, driven largely by the long distances travelled, rising fuel and labour costs, deteriorating conditions of road infrastructure and increasing congestion in major cities, transportation costs and cost-to-serve are focus areas for all businesses.
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However, the integration of the following elements is also key to providing FMCG companies with the right transport solution – planning, visibility, reliability, flexibility, safety and environmental sustainability. With retailers also moving towards a ‘less, more often’ approach, constant evaluation of the distribution network, different transport modes and equipment are important. An example of equipment developed to specifically optimise distribution for the FMCG and retail industry is Volumax. Volumax is a smart solution that was designed based on the Manhattan Skyline principle, which assists in optimising payloads and space, reducing goods-in-transit damages and enabling the transportation of a variety of products on one vehicle.
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African Borders Handbook Essential border information and country profiles covering 10 African countries and 46 border posts The African Borders Handbook contains up-to-date, essential information about the main border crossings in Africa. The book is devided into 10 sections: Angola, Namibia, Lesotho, Swaziland, Mozambique, Botswana, Zimbabwe, Zambia, Malawi and Tanzania. Each section contains a country profile with the major macroeconomic indicators, strengths and weaknesses and a risk assesment. There is a short transport profile of the country, and then a page dedicated to each of the major border posts containing information on opening and closing times, accepted payment methods, contact details, travelling information, compulsory vaccinations, required documents and costs.
Get all the information you need for your cross border operations in one handy pdf e-book. Visit our online store: www.3smags.co.za to purchase a copy, or for more information contact Esther Le Roux on +27 (0)11 233 2600
www.transportworldafrica.co.za
www.3smags.co.za
LOGISTICS
Recognising SA’s Truck Driver of the Year Leading fuel, oil and lubricants manufacturer and supplier Shell will this year co-sponsor the Scania Truck Driver of the Year competition. The competition is run every alternate year to promote a professional driving culture in the transport sector.
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NDREW EVANS, commercial marketing manager at Shell, says: “Safety is at the core of everything we do at Shell. This competition is a great way to recognise good drivers, help improve skills across the industry and address road safety concerns on South Africa’s roads.” He adds that, when compared with other countries, there is far less emphasis on the training and support of drivers in South Africa. Shell endorses driver training and education to raise their profile as an integral part of the transport business. “At Shell, truck drivers are referred to as bulk vehicle operators for the simple fact that they are professionals and make a huge contribution to the economy. When it comes to fleet management, there tends to be a focus on vehicles and technology, but less emphasis on the important role that drivers play.” The perception of drivers needs to change. Not only do they represent a company’s brand to an external audience, interact with customers and are central to road safety, they also impact the bottom line when it comes to fuel economy. “Fuel accounts for between 30% to 40% of a vehicle’s operating expense, so drivers play a central role in managing costs in the transport sector. Poor driving behaviour, such as braking or accelerating abruptly, uses more fuel and drives up costs.” Shell estimates that a poorly trained driver can influence operating costs by up to 60%. Passionate about innovation, Shell also provides products such as Shell Diesel Extra, helping customers to improve their efficiency. Shell Diesel Extra contains a unique formulation designed to provide cleaner fuel and extra kilometres at no extra cost. This means less energy is used to run vehicles over their lifetime. Shell Diesel Extra also contains an anti-foam component for easier and cleaner fill-up. Tests conducted by Shell have also shown the fuel’s ability to improve fuel economy up to 3% versus non-additised fuel. Lubricants also contribute to fuel efficiency. They are in contact with – and critical to – the effective operation and longevity of almost all engine parts. Long-standing technical relationships with engine manufacturers have also enabled Shell to assist key vehicle manufacturers to set new world records in truck fuel efficiency using Shell Diesel Extra and Rimula R6 LME. Shell Rimula R6 LME delivers exceptional wear protection and engine piston cleanliness in the latest engines. It has
been tested to help ensure long engine life and protection throughout the oil maintenance interval. Shell Rimula heavy-duty diesel engine oils provide protection in three critical areas: acid control, deposit control and wear control. Its adaptive technology also provides reduced viscosity for improved fuel economy. “When drivers understand how using the right fuel and lubricants can affect the performance of their vehicle, they are better equipped to enhance fuel economy.” A 360-degree approach is necessary when evaluating drivers – annual evaluations of drivers should be conducted to ensure their competency and their overall wellness, including their ability and preparedness on the day of their journey. Other factors fleet managers and transport owners should consider include ensuring drivers have the correct information about the route. This includes any potential risks that may be faced, teaching drivers how to conduct thorough pre-trip inspections, handling specific cargo, as well as interacting with customers. “While a company can have the best vehicles available on the market in its fleet, the driver is central to how these are driven and maintained as well as perceived by other road users,” explains Evans. During this competition, competitors will need to complete an obstacle course that involves precision vehicle manoeuvres while in reverse and in forward motion. The competition is governed by numerous safety rules both on and off the circuit, and drivers are penalised accordingly for ignoring any of these rules.
It is about smart and safe driving in the competition
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LOGISTICS
Peak transport operations T Dealing with peak transport operations in the fourth quarter from a logistics point of view is critical. Simon Foulds speaks to American expert Carol Ptak, tapping into her international experience on dealing with this topic.
HE MOST ESSENTIAL success factor is to correctly position inventory in the supply chain as well as understand how the speed in manufacturing can be leveraged to respond quickly to increased demand in the fourth quarter. This is a critical part of the demand planning process. Successful companies need to establish a complete supply chain strategy that allows them to successfully sense and adapt to changes in customer demand.
Carol Ptak, management consultant
Ensuring forecast is accurate By definition, forecasts are always in error. This is why forecasts typically are given with a range of error. Unfortunately, planning systems cannot calculate a net requirements plan
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LOGISTICS
The companies that can respond more quickly to unexpected changes in demand are the companies that will be successful given a range. A specific number is required as demand. Therefore detailed item level forecasts are irrelevant for execution level planning. It is more important to understand customer tolerance time, market potential lead time, demand and supply variability, inventory leverage and flexibility, and critical resource protection to establish a demand-driven supply chain.
Demand planning in the fourth quarter Demand planning is absolutely critical especially in the higher volatility of the festive season. Demand planning is a critical balancing act between capability and customer demand to ensure that the company maximises its return on capital employed. Not having enough inventory means lost sales – possibly lost forever to a competitor. Having too much inventory wastes critical resources, including capital. The companies that can respond more quickly to unexpected
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changes in demand are the companies that will be successful in the long run. The issue at hand is not just one quarter’s profits – it is the overall success of the company.
The least understood supply chain discipline It is the least understood because this discipline reaches across planning, finance, sales, operations, marketing and quality. For years, the discipline has focused on the different objectives of these individual departments instead of understanding that flow is the enabler of all these primary functions. George Plossl once said that the first law of supply chain management is that all benefits will be directly related to the speed of flow of materials and information. These materials and information have to be relevant. This discipline attempts to protect and promote flow, which means that return on investment is maximised. All benefits include: • service is consistent and reliable when a system flows well • revenue is maximised and protected • inventories are minimised • expenses ancillary and/or unnecessary are minimised • cash flow follows the rate of product flow to market demand.
LOGISTICS
Creating good demand planners
Forecasting methods are best used for medium- and longrange forecasting. The best methods are the ones where the different departments collaborate to come to a consensus on that strategic direction. Again, using forecasting for execution-level requirements is the epitome of waste and should be avoided.
The results were: • company cash flow before the project started was negative. It is positive now. • sales in their retail chain increased in 12%, with over 40% less inventory, ROI took a quantum leap • average production lead time decreased from 45 days to 14 days • high movers get priority in production and are replenished within days • replenish high movers in 24 hours, starting from raw materials, and therefore, eliminating the risk of overproducing slow movers • sales of high movers in the December peak season of 2013 were nine times higher than the sales of high movers in the same period in 2012, due to fast replenishment within the high season • stock-outs in the retail shops decreased to 2%.
Truck routes and times
Involving drivers and warehouse personnel
Truck routes and times are a critical part of the planning process. If the truck route allows for frequent replenishment of product to the retailer then the retailer does not need to carry extra inventory. Truck routes and times are the enabler behind a truly demand-driven company. A company in Columbia, USA, which manufactures Disney merchandise, changed its truck capability to smaller delivery vehicles and was able to better leverage its plant’s quick response capability.
It is critical to involve the drivers of the trucks because they know best how to shorten response time and eliminate waste. This is most critical in the fourth quarter for the build-up to the festive season. There is little room for error. Sometimes by changing something as simple as a routing sequence or stop order, significant time can be saved. Having an absolutely reliable delivery capability is essential for success in this highly volatile holiday season. Those last few miles can be the most difficult and challenging.
It is key to develop not only the quantitative skills but also the human resource skills necessary to work across the enterprise. This role must be able to speak several ‘languages’ used in each of the different departments of planning, finance, sales, operations, marketing and quality. The best demand planners have excellent intuition about the company and its customers. This takes a high level of education, training and experience.
Best demand forecasting methods
Not having enough inventory means lost sales
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SAVE WITH CONNECTED FLEETS
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LOGISTICS
Future of connected fleets A new dimension is being added to the concept of ‘connected’ vehicles. Questek Telematics, through its flagship product, can warn a fleet administrator when a vehicle is going to break down and identify why.
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HIS PREDICTIVE diagnostic technology is already saving commercial fleets around the world thousands of rands per vehicle each month, and is now available from Questek, a local leader in the application of transport technology. Darryl Erasmus of Questek Telematics explains, “The key to our innovative new technology is not just the predictive element but also the sophisticated recording and reporting element. Telematics is only as good as its ‘back end’ and we’ve incorporated a number of features which make it extremely easy to use as a management tool.” The ‘front end’ of the system is equally dynamic and efficient. The key to its revolutionary nature is a driver and vehicle management system which integrates seamlessly with the CANbus network – an integral part of modern vehicles. In a CAN (controlled area network) system, each component in the network has its own processing and communication capabilities, with one data channel connecting all units, instead of each component being wired directly to a central control unit. Many sensors and actuators have their own individual mini-control units and all the units – called nodes – communicate with each other through a single pair of wires known as a data bus. This allows for the measurement and frequency of many vehicle parameters: oil pressure and temperature, water temperature and level, engine speed, road speed, brake pressure and many more can be monitored in real time. The second element is a module installed on the vehicle and which measures GPS positioning, and also lateral and longitudinal acceleration. With so much information recorded and analysed using proprietary algorithms, predictions can be made – for example – whether a door is going to fail on a bus (based on information such as the number of times it has opened and closed, but also the cadence of its open/shut cycle and any deviation from a standard cycle). It is also capable of
recording whether a driver is freewheeling, over-revving a cold engine, using the incorrect gear ratio, or pulling away with too high a clutch load. Adds Erasmus: “If it moves, we can count it. That can include the number of rotations on the drum of a cement mixer and the number of brake applications on a bus. As well as predicting breakdowns, it allows for more accurate use of resources: instead of replacing brake pads at scheduled intervals, we can now calculate exactly when the life of the service component will end.” The technology of the system is constantly being developed and refined. Over 170 000 vehicles worldwide use it and, in some case studies, fleets are saving R75 000 a year in truck maintenance and R25 000 a year in car maintenance. Companies are reporting a 50% reduction in accidents and a 14% fuel saving. Arriva, the British bus company, is saving one million litres of fuel a year. As well as predicting a roadside breakdown (and associated delays, and issues such as reputational damage), it can be used to alter driver behaviour. The Driver Manoeuvre Awareness System combines visual and audible warnings when an event (braking, turning, acceleration) exceeds a predetermined threshold. This upskills drivers rather than persecutes them, and is also able to prevent behaviour like freewheeling in neutral, which is erroneously believed to be beneficial in terms of fuel consumption. Because the system operates live and passes information back to a central hub via the global positioning satellites network, the driver’s habits are equally ‘live’ and not just live in terms of being a moving dot on a map, but giving a full house of information. A real-time video dashboard is created for each vehicle, which can be viewed at any time, and sophisticated reports can be generated. The old adage that prevention is better than cure remains as true as ever and, with their predictive diagnostic abilities, Questek Telematics is taking telematics where it hasn’t been before.
Darryl Erasmus of Questek Telematics
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LOGISTICS
Challenges and opportunities The most exciting growth opportunity for South African manufacturers as well as international companies importing into Africa, is the fast growth in the African environment. Africa’s growth depends on the quality of logistics solutions
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ERRIE DE JONGE, executive: Africa Business Unit, Imperial Managed Logistics, outlines to Simon Foulds about how companies can turn the challenges into opportunities. Taking on this opportunity, importers and exporters are however faced with the challenge of logistics into and out of the regions on the relevant transport corridor, looking at the end-to-end logistical requirements that need to be put in place and the challenges that need to be overcome. The successful capturing of market growth from an import and
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export perspective in Africa is entirely dependent on the ability to overcome the logistical challenges on a daily basis and creating a streamline end-to-end logistics solution. In order to create a successful logistics solution, strategic partnerships linked to continuous awareness of institutional and commercial requirements are of essence. Further to this, the respective logistics solution needs the flexibility to be able to cater for economic-driven market fluctuations, making it so much more exciting and challenging. Whether moving resources out of Africa or bringing goods and services into its
LOGISTICS
burgeoning economies, Africa’s future growth and development will depend on the quality of its infrastructure and the efficiency of logistics solutions. Some African countries are experiencing a rapid period of growth, with imports rising to cater for the increase in the demand for basic consumables, construction material and industrial inputs; at the same time there is a fast-growing demand for the vast commodities available on the African continent. Africa has an abundance of mineral resources and significant opportunities for agricultural expansion. Specific countries linked to this with a direct opportunity for South African companies to expand into are Namibia, Angola, Zambia, the DRC, Mozambique and Tanzania. South African growth is forecast at around 3% while the countries mentioned above are expected to grow between 5% and 6%. The natural occurrence will be for South African companies to look for growth opportunities in neighbouring countries before stretching further into the rest of Africa. The moment this happens, they are faced with the challenges of end-to-end logistics solutions to move cargo into and out of Southern Africa effectively. The South African transportation and logistics industry can play a vital role in Africa’s efforts to gear up and ensure continuous and sustainable growth, which includes building its infrastructure, enabling supply chains and distribution networks, providing mobility, and ultimately helping create jobs for its people. Each country in Southern Africa has its own value proposition. There is a strong need for the road, rail, air and port transport networks in some economies to be improved. Transport and logistics infrastructure has the potential to unlock the economic growth value of the continent. While port, road and rail infrastructure is mostly dependant on government investment, operations thereof and the movement or cargo between critical points becomes an opportunity for the private sector to create effective logistical solutions that will meet the expectations of importers and exporters. Southern Africa requires dependable logistics services and skills, backed by established infrastructure and world-class information technology systems, to sustain its positive growth trajectory. The key challenges faced by importers and exporters requiring an effective end-to-end logistical solution are: • numerous logistical service providers in the end-to-end solution • complex border- and country-specific legal requirements • long transit times with no clear visibility of hold-ups • language differences • continued communication • no integrated planning and data sharing between logistical service providers • bi-directional flow mismatch increasing logistical costs.
Taking these challenges into account, there is the opportunity to create streamline end-to-end logistical solutions for importers into and out of Southern Africa, combining the roles and critical points within the supply chain to have one point of contact and visibility. In order to do this, one either has to be able to provide services in all countries across all areas of the logistics network, or partner up with suitable strategic partners in the specific countries and area of logistical service required. The latter being the more realistic one at this point in time. There is a need for an integrated, single-point-of-contact solution with visibility and end-to-end data availability to take the complexity away from the customer, and hand it over to an endto-end logistics service provider. Such an end-to-end solution will then create visibility and the opportunity to use available data to create business intelligence platforms and continually increase the efficiency of the logistics network and lower the associated logistics costs. The result of such a one-point-ofcontact, end-to-end solution will be: • full visibility over the logistics network • single view of data available and better decision-making • effective combination of consolidation, road transport, customs clearing and shipping • reduced transit time • cost reduction • safe and secure supply chains • proactive management of supply chain eventualities • improved turnaround times through border posts. For logistics to become a competitive weapon for South Africa, change is required. We need to move from the mindset that logistics is merely the result of other market activity, to that of giving logistics its due as a value creator. The same can be said for logistical requirements in Southern Africa where the time is here for more complex end-to-end supply chains to be implemented in order to create value for industry within Southern Africa and lower the cost of logistics, in turn making Southern Africa more competitive.
CLOCKWISE FROM TOP LEFT The movement of cargo between critical points becomes an opportunity
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CORRIDORS
NTBs still a big problem Traders are losing money, a new survey has revealed, through non-tarrif barriers (NTBs) along the Northern and Central corridors. By Simon Foulds Truck drivers are often forced to park alongside the road
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HE STUDY BY the Monitoring Committee on NTBs and the East African Community, called ‘The Current Status of NTBs in East Africa’, states that some partner states have not done much to eliminate NTBs, which is hurting business growth. The slow pace at which some of the member states are removing non-tariff barriers has resulted into a profound effect, with 39% of imports and exports paying a heavy price. Tanzania still has the highest number of NTBs, followed by Kenya, Uganda and Rwanda. Traders in the region recently reported that member states have added further NTBs, hindering regional trade, including an increased number of police roadblocks along the Central Corridor from Dar es Salaam to the Rusumo border.
Delays, theft at Dar es Salaam, Mombasa ports According to some traders, the theft of containers, especially
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of minerals and fertilisers, is increasing at the Port of Dar es Salaam. The port is also not open 24 hours a day, contrary to what is claimed by authorities in Tanzania, traders added. Grace Mulinda, a clearing agent, tells TWA, “Most of the theft takes place inside the port before containers are loaded. So, it is important that measures are put in place to ensure containers are sealed to minimise some of these risks. There is also a need to increase surveillance cameras at the port.” She added that sometimes they wait for many hours before accessing containers, noting that there are also delays in reimbursing container deposit fees, which is increasing the cost of trade. On average, a trader pays $4 000 for a 40-foot container as container deposit. Abdul Ndaru, managing director of TransAfrica Container Transport, also tells TWA that port congestion is also forcing
CORRIDORS truck drivers to park along the road resulting into payment of penalties to the city council.
National park charges “Added to this, Rwandan trucks are being charged $300 for passing through the national parks of Tanzania while our Tanzanian counterparts only pay $50. This fee should be harmonised to facilitate easy movement of goods and lower the cost of doing business along the Central Corridor,� states Ndara. According to the EAC time-bound programme on NTBs, lack of coordination among regional institutions involved in the harmonisation of standards and existence of several weighbridges along Northern (eight) and Central (seven) corridors are still hindering cross-border trade.
Northern and Central corridors. According to Hannington Namara, the TradeMark East Africa country manager, the introduction of an electronic single window system has reduced the cost of doing trade in real time.
Eliminated NTBs The report also states that the road toll in Tanzania has been reduced from $500 to $152 per truck per trip, resulting into a saving of up to $800 000 per year for transporters using the Central Corridor. The report also indicated that the state of road and ports infrastructure has significantly improved. Weighbridges in Kenya have been reduced from six to four, and in Tanzania from eight to seven, while police roadblocks have been removed in Kenya and Uganda and reduced in Tanzania, the report indicates.
Efforts to address NTBs ongoing Valentine Rugwabiza, the East African Community Affairs Minister, adds that the regional common market protocol is not yet a reality and that there are still a number of trade barriers hindering free movement of labour and capital across the region. It is envisaged that the single customs territory along the Central Corridor will be implemented before the end of 2014. An SMS feedback line (2525) has been introduced in the region so drivers can report NTBs that occur along the
A single customs territory should be established before the end of 2014
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PORTS
Terminal plays pivotal role in Cape economy Velile Dube, Transnet Port Terminals general manager: Western Cape
The Cape Town Container Terminal plays a pivotal role in the regional economy, enjoying intermodal transport networks and situated about 20 km from Cape Town International Airport.
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APE TOWN Container Terminal (CTCT) operations date back to 1977 – facilitating movement of containerised cargo, wine, fruit and white goods to and from the Asian, European, American, Australian and growing East and West African markets. The terminal has since played a pivotal role for the region and its economy as it is now primarily viewed as a reefer terminal, renowned for the export of deciduous fruit, perishables and frozen products. Fruit and fresh produce are the CTCT’s major export commodities and the port infrastructure allows for this time-sensitive cargo to leave inland terminals/pack houses, and arrive at their chosen destination in peak condition. The terminal is well connected to its hinterland through extensive rail and road networks. Simon Foulds speaks to Velile Dube, Transnet Port Terminals general manager: Western Cape, to find out more about the current state of the CTCT.
What makes the Cape Town Terminals an asset
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to the South Africa itself? There are a number of reasons that make Cape Town Terminals stand out, including: • Cape Town Terminals is divided into two facilities; namely: containers and agricultural bulk (multipurpose) facility. It has the added advantage of a large commodity mix, but the terminal focuses on containers, general cargo, vehicles and textiles, as well as meat, fish, fruit, barley, wheat, maize, soya, oats and fertiliser. • The Cape Town Terminals’ geographical positioning gives it a unique advantage of being a first and last port of call, which in turn allows it to provide unique services to the automotive and agricultural industries. • After Durban Container Terminal, the Cape Town Container Terminal is the second largest container terminal in South Africa. • A major commodity of the CTCT is fruit exports, which constitutes 17% of the total throughput of approximately 600 000, 20-foot equivalent units (TEUs) per annum. These include exotic fruit, citrus fruit,
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deciduous fruit, sub-tropical fruit, vegetables, flora, grain and oil seeds. The agricultural bulk capacity is 400 000 tonnes, which is double the break-bulk capacity at 200 000 tonnes per annum. As a first port of call from North America and Europe, it has an advantage of transporting high-value, time-sensitive cargo as well as providing just in time for export fruit to Europe. The Multipurpose Terminal is situated in the Duncan Dock area of the harbour, and operates from E berth to K/L berth, a quayside length of almost 1.8 km. It is directly involved in the intermodal transfer (land to sea and vice versa) of diverse containerised, general and bulk cargo as well as offering related services. A recent expansion project transformed South Africa’s second largest container terminal into a modern fourberth facility that is able to cater for larger vessels that require deeper and wider port entrances and berths. Another forward-thinking feature includes high-productivity
container handling using faster and more efficient cranes.
What are the operating hours of the port? • The port is open 24 hours a day and operates 362 days per year for continuous loading and unloading except for 1 January, 1 May and 25 December. • Berthing, on the other hand, occurs every day.
What is the size of the ships the Cape Town Terminals is able to accommodate? It has the following capacity: • 7 500 ground slots • key length of 1 132 m • 15.5 m depth from 601 to 604 • can berth vessels of 14.2 m2 heavy laden • 16.5 m depth at entrance channel.
How many cranes are currently operational at the Cape Town Container Terminal and what types of cranes are operated in the port? Waterside Cranes: • six super-post Panamax Liebherr cranes
PORTS
• two mega-post Panamax Liebherr cranes are scheduled to be in operation at the beginning of November 2014, therefore bringing the total crane number up to eight. Landside support: • 28 RTGs (rubber-tyred gantries) • 12 straddle carriers • two reach stackers • one rail gantry • six mt stackers.
How many movements take place per hour? • Cape Town Container Terminal has an average 32 mph. • Cape Town Terminal Waterfront (MPT) has TEUs: 17.2 GCH and Bulk: 236 TSWH.
What is the average waiting period for ships waiting to enter the port?
How many ships visit the port annually? Approximately 3 000 to 4 000 vessels visit the port annually.
What are the different types of cargo that move through the Cape Town Terminals? The Cape Town Terminals handle predominantly agricultural bulk such as fruit and fresh produce, as well as break-bulk commodities, which range from chrome and steel, to motor vehicle components, chemicals, textiles, sugar, fishing, bulk oil, cement, timber and cement.
How many ships can be accommodated at any given time? Cape
What sorts of volumes moves through the terminal annually?
Town Container Terminal accommodates three alongside. Cape Town Multipurpose terminal has six berths available, and the terminal can accommodate two combi/container vessels, two bulk vessels, and numerous smaller foreign fishing vessels at any one time.
Approximately 800 000 TEUs move through both the container and break-bulk terminals every year.
What have been the latest infrastructure developments at the port?
Approximately 5.4 hours against a target of 16 hours.
The following are some of the key highlights: • The current capacity at the Cape Town Container Terminal is 900 000 TEUs subsequent to an expansion project to the value of R5.4 billion, which has increased capacity by around 30%, from 700 000 TEUs. • This expansion project transformed South Africa’s second largest container terminal into a modern four-berth facility able to cater for larger vessels that require deeper and wider port entrances and berths, and high-productivity container handling using faster and more efficient cranes. • It deepened all four berths together with the Ben Schoeman Basin to 15.5 m. • There has been a reconfiguration of the stack yard in an effort to maximise space. • Straddle carriers have been replaced with 28 brand-new Kalmar-manufactured rubbertyred gantry cranes that have the capability to stack containers wider, deeper and higher. • Refurbishment of the quay wall to support the super-post Panamax ship-to-shore cranes has taken place.
• The port’s expansion project has seen the replacement of the previous ship-to-shore cranes with eight Liebherr super-post Panamax cranes with twin-lift capability. Six of these cranes are in place to date with the additional two currently being commissioned.
What future expansion plans are in the pipeline? The second phase of the expansion project is well under way; it will see more quay works with the aim to increase the terminal’s overall container handling capacity by over 50%, from 900 000 TEUs to 1.4 million TEUs by 2016.
How optimistic are you about the growth of the port and why? Cape Town port is seen as a major economic gateway for Cape Town as well as the rest of the country. It is the oldest port in South Africa, but despite changes to its maritime culture brought by air travel, it is still an important point of entry. It is seen as a key engine for economic growth as part of the Transnet Market Demand Strategy.
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PORTS
R650 million fuel storage facility Burgan Cape Terminals last year received a 20-year contract to develop and manage fuel storage and distribution facilities at the Eastern Mole of Cape Town harbour. Simon Foulds speaks to Muziwandile Mseleku, CEO of Burgan Cape Terminals, to ďŹ nd out more about the development.
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OR THIS PROJECT, Burgan entered into a joint venture with Rotterdam-based VTTI, which operates, develops and acquires refined petroleum product and crude oil facilities and energy infrastructure assets on a global scale. Total capital expenditure for the project is estimated to be around R650 million.
What does this facility mean for the Western Cape? The project will have many positive benefits for South Africa, and in particular the Western Cape. Notably, it will significantly improve security of fuel supply and enhance flexibility. It will also address transformation in the downstream petroleum sector, not only through HDI ownership but providing access to storage facilities for independent wholesale licence holders, thus lowering the barriers to entry and
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fostering healthy competition in the petroleum storage and distribution market. The terminal will enable both independent and major oil marketers to import, store and distribute 50 ppm petrol and 50 ppm diesel, which are often in short supply. The terminal will also provide storage for clean fuel strategic stock requirements. We believe the import capacity is critical considering the current constraints in Cape Town. In addition, a R650 million investment was allocated for the design and construction of the facility over the first 18 to 22 months of development. Approximately 110 to 130 contract jobs will be created in the same period. While the facility is not linked to Chevron’s refinery in the Western Cape, it will have the ability to easily integrate into the facility, thereby increasing
efficiencies across the value chain.
Who will in turn be renting space from Burgan? The facility is open to all players who market liquid fuels in Cape Town. Burgan Cape Terminals has already signed long-term (covering a period of10 years) contracts with both established oil marketing companies and independent entrants. To date, more than 50% of its storage capacity has been filled. The terminal is owned and operated by an independent infrastructure development company instead of a marketing company and allows for improved flexibility and competition in the area.
Why did Burgan enter into a joint venture with VTTI and what are the advantages to South Africa? Besides the
investment that VTTI is making in expanding the country’s clean fuel storage capacity, VTTI brings exceptional skills and its experience as a top global storage terminal operator to the project. VTTI operates, develops and acquires refined petroleum product and crude oil facilities and related energy infrastructure on a global scale. We believe that this project enables a partnership of local knowledge and skills, assisting transformation and downstream expertise.
When will the fuel storage terminal be complete and who is building it? The project is currently undergoing EIA and NERSA permit application processes. We anticipate the terminal to be operational by July 2016. We are in the process of releasing a tender for the construction of the project.
GOODS IN TRANSIT
Cargo insurance vital Maritime perils represent significant financial losses to cargo owners, without the requisite marine insurance to protect their cargo. Simon Foulds speaks to Jeffry Butt, marine manager at Aon South Africa, to find out what needs to be done to ensure your cargo is insured adequately.
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OODS IN TRANSIT ARE highly susceptible to damage by fire or storm, theft, jettison or mishandling. Cargo insurance is an essential means to guard against serious financial loss and in particular as the application of general average losses grows and becomes more commonplace. A general average occurs when a voluntary sacrifice is made to safeguard the vessel, cargo and/or crew from a common peril, e.g. the jettison of cargo to lighten a vessel in order to get to the closest port to prevent a ship from sinking, and even piracy. If the sacrifice is successful, all parties contribute to the loss based on a percentage share that their cargo value bears to the full value of loss suffered, with the maximum contribution not exceeding the full value of their cargo. Butt explains: “Let us take an example of cargo being jettisoned to prevent a ship from sinking. When general average loss occurs, the owner of the vessel will arrange for an average adjuster to assist with the evaluations of the cargo on board, the value of the vessel as well as potential consequential risk to lives and the environment. The average adjuster will then provide each cargo owner with an average guarantee or bond to be signed and returned. This confirms the commitment from each cargo owner that they accept responsibility to pay their proportionate share of the collective cost of the cargo that was sacrificed to save the ship and all the goods and cargo still on board. General average only applies in the case of a successful sacrifice.” There have been instances of general average where the proportionate share each cargo owner had to pay was equal to 60% of the value of their cargo on board the affected vessel, however, it has become more common that open-ended average guarantees are required to be signed and returned to average adjusters. For example, if a particular cargo owner had cargo to the value of R10 million on board the affected vessel, his contribution will be R6 million up to R10 million. For any business without adequate marine insurance cover in place, this kind of exposure can be potentially devastating.
If the cargo is not insured, the cargo will not be released until the cargo owner posts a guarantee in the form of a cash deposit, bank guarantee or bond. If the cargo is insured, the insurance company will post the general average bond and guarantee to meet the cargo owner’s contribution and facilitate release of the cargo. “Consequential losses and trade disruptions are also a huge risk factor. Salvage operations can take weeks and even months, leaving companies without their cargo and no sales activity. In the case of piracy, ships and cargo can be held for months on end before any ransom negotiations begin. This leaves businesses massively exposed to profit loss risks if they are not insured properly.” Given the quantum of risks that can befall valuable cargo while in transit, it is essential for all ship and cargo owners to make sure that they have spoken to a specialist advisor who understands the full set of risks facing a marine business in order to provide a comprehensive risk assessment. Butt concludes, “This will assist not only in identifying what type of cover is best suited for the business but will also save the company from suffering significant potential losses, especially in the event of a sacrifice being made and a general average being declared.”
Cargo insurance is vital to protect businesses from crippling profit losses
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TRAINING
Strategic logistics investment Skills shortages continue to bedevil the logistics and supply chain industry, with practitioners reporting shortages of up to 64% in positions that require a bachelor’s degree. By Dr Mario Landman, head of the Institute of Logistics and Supply Chain Management
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VEN AT OPERATIONAL level where candidates need either a matric qualification, a diploma or a certificate, companies experienced a 27% shortage in 2013. In South Africa today, the skills shortage is the fourth highest supply chain constraint. This is according to the CSIR’s 10th Annual State of Logistics Survey for South Africa (2013), which reports that the lack of skilled personnel at all levels continues to be a major concern in the performance of supply chain management. It is a challenge that affects virtually every one of South Africa’s key economic drivers. Industries such as mining, manufacturing, retail and farming, for example, would be incapacitated without these skills and services. Every year, investment in the road, rail, port and airport infrastructures continues to be a high priority with billions of rands invested in various projects. In 2013, logistics costs were estimated at R423 billion and, as a percentage of transportable GDP, have grown significantly over the last four years, primarily due to fuel increases. Developing efficiencies within endto-end supply chain integration is now critical for strong financial performance and mitigating the effect of volatile fuel costs. Thus strategically, investment in logistics and supply chain management skills would be a vital contributor to a profitable bottom line. In such a rapidly developing and changing industry, skilled practitioners need not only the required hard skills (traditionally taught academically) and soft skills, but also the work experience. Especially if they want
“In South Africa the skills shortage is the fourth highest supply chain constraint.” Dr Mario Landman, head of the Institute of Logistics and Supply Chain Management
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to progress in the industry and use the benefits of such change to their organisation’s advantage. Soft skills are of such importance to the industry that in surveys conducted by the University of Johannesburg, it was found that practitioners place these skills, particularly customer-focused management, well ahead of the required hard skills. Students, however, prioritise such skills much further down their lists. This discrepancy could be accounted for by the lack of real-world experience in the industry on the student’s part. The problem is that it does however create a gap between the needs of employers and the skills pool available. Such a gap results in many candidates – despite having degrees – not being fully qualified for a position; particularly as they look to move into more tactical and strategic roles of supply chain management. It is at this juncture that the industry runs the risk of losing skilled candidates to other courses and even careers. While many industry practitioners do recognise the need for more skills and believe further qualifications like a National Diploma or Bachelor of Business Administration degree could help them, very few are able to take these traditional routes through academia due to financial constraints and those of their working environment. For instance, attending regularly scheduled classes can be difficult for a practitioner with the type of work schedule common in the logistics industry. The traditional distance learning alternative is also not viable, as this does not offer suitable support. It is this gap that needs to be filled by more responsive professional certifications, graduate training programmes and vocational associations. While APICS’ Operations Management Body of Knowledge Framework found that the quality of tertiary degrees in the field were on par with other BRIC countries and adequately taught the hard skills, professional certifications and membership of professional associations lagged behind and it is through these institutions that a better understanding of the soft skills could be developed. Empirical evidence is showing that partnering with education providers is a highly effective route for companies seeking to build their skills capacity and improve their overall performance.
DRUGS
Testing drivers for drugs Drug abuse is a growing problem in South Africa, as the variety of drugs available continues to increase and the cost of purchasing these drugs decrease. By Rhys Evans, director of ALCO-Safe
I
N FACT, CERTAIN drugs are now cheaper than alcohol, which has led to a significant uptake in the number of users. The dangers and liabilities of employees under the influence of drugs can be far-reaching and, as such, mandatory drug testing is an option that more and more organisations across industry sectors are investigating. However, the decision of whether to implement saliva or urine testing can be a challenge. Each technology has its own pros and cons, which need to be weighed against the industry an organisation operates in and its environment, in order to ensure that the best solution is implemented. Drug testing has traditionally been regarded as a challenge to implement from a legal perspective. It was also regarded as slow, expensive, an invasion of privacy, and a host of other perceived obstacles that have limited its use. However, given the growing problem of drug abuse in South Africa and the dire consequences on safety, performance and efficiency, drug testing has never been more important. Improvements in available technology have made drug testing easier and more affordable than ever; this can assist organisations to save lives and improve productivity and their bottom line. When it comes to selecting equipment, there are a number of different solutions available, divided into two main categories of urine and saliva testing. In addition to these, test kits are also available to test solid substances, such as powders or tablets, for the presence of drugs. Urine testing solutions are generally low cost per test and are highly portable, which makes them a cost-effective option for many industries. They are also available in several different form factors depending on budget and requirements. Dip tests are strips that are dipped into a urine sample and will display either one or two red lines indicating the presence of drugs, similar to a pregnancy test. They are available as a single- or multi-panel test, which means that they can be used to test for a single specific drug or a range of commonly abused drugs. Another form factor is the cassette test, which is a multi-drug test that requires the operator to use a pipette to drop a urine sample into each window for testing. Integrated cup tests are also available, which incorporate the test panel into the sample cup. The cup tests are extremely popular as they have additions such as thermometer strips built in to check the urine is at body temperature. Small additions like this are very useful as they discourage attempts
to cheat the tests. Both of these tests will also use red lines to indicate the presence of commonly abused drugs in the sample. Urine testing is not suitable for all applications, as certain considerations must be taken into account. Due to the need for privacy, females must be tested by females and males by males. There must also be a private bathroom available to obtain the urine sample. This is not always possible, however, particularly in industries such as construction where bathroom facilities are typically provided for by portable toilets. For applications where urine testing is not possible, saliva testing provides a convenient alternative. Saliva testing uses a swab to produce results in a matter of minutes, and can be used to screen for a panel of five common illegal substances including heroine (nyaope), cocaine, marijuana and methamphetamines, which include substances such as tik, ecstasy and cat. There are no privacy concerns with such testing, and a male or female tester can test both male and female subjects. In addition, the person may have emptied their bladder a short while before requiring testing for drugs; this will lead to delays that you will not have to deal with when using a saliva test. Some saliva testing units can be very large and heavy and are not particularly portable, so organisations need to ensure they select a compact and easy-to-use system. Saliva testing can also be more expensive per test than urine testing, so is less viable in organisations and industries with small budgets where many tests need to be performed on a frequent basis. While saliva testing solutions have gained popularity because of their less intrusive nature, they can be expensive, and are not always the best possible solution. Urine testing remains a useful option. Organisations need to consider the nature of the testing and the cost involved, as well as the specific circumstances of their business and industry. Partnering with an expert service provider who can assist with this decision will ensure that the most appropriate equipment is supplied to maximise return on investment and optimise safety.
Truck after accident due to driver on drugs
TWA | Nov/Dec 2014
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AIR CARGO
Air freight recovery strengthens The International Air Transport Association (IATA) announced that August 2014 data for global air freight markets showed continued robust growth in air cargo volumes.
M
Tony Tyler, IATA’s director general and CEO
EASURED BY FREIGHT tonne kilometres (FTK), volumes rose 5.1% in August, compared to August 2013. Capacity grew at a slower pace of 3.4% from the previous year. This is the second strong month for cargo volumes in a row, following the 6.1% year-on-year rise recorded in July. Carriers in all regions reported an expansion in volumes. Closely following improvements in world trade and business activity, airlines in the Middle East, North America and Asia reported the strongest growth in the 5% to 8% range. By comparison, demand in Europe and Latin America lagged in the 1% to 1.5% range as a result of Brazilian economic weakness and EU sanctions on business with Russia, respectively. Tony Tyler, IATA’s director general and CEO, says, “The outlook for air cargo is clearly getting better. However, there are some limiting factors on the extent of potential gains. Demand for air cargo is growing more slowly than global economic activity. Businesses are reported to have more confidence in the future, but the list of political and economic risks continues to moderate how that confidence translates into actual activity.”
Carriers in all regions reported an expansion in volumes
Regional analysis in depth African airlines reported the strongest growth of air cargo
demand with a 9.2% year-on-year expansion. Although this is the second consecutive month of strong growth, the volatility of African data, coupled with the slowdown in key African economies such as South Africa, means it is too soon to understand the extent to which this represents a real and sustainable acceleration. Capacity grew 4.2%. Asia Pacific carriers grew 6.3%, continuing the acceleration of recent months. Emerging Asian trade volumes have expanded volumes solidly in June and July. A notable rise in Chinese export orders bodes well for future demand growth. Capacity expanded 4.4%. European airlines grew 1.4%. Economic activity within the Eurozone continues to deteriorate, although the latest data does show a moderate pick-up in imports and exports. EU sanctions as a result of the RussiaUkraine crisis also continues to affect demand. Capacity expanded 4.8%. North American carriers increased air freight volumes by a solid 5.5% compared to a year ago. A rebound in business activity following the weakness in the first quarter and positive underlying economic growth trends should support stronger growth in the coming months. Capacity fell 0.4%. Middle Eastern carriers reported cargo growth of 7.8%, a little below the year-to-date average of 9.6%. The Middle East continues to expand strongly on its growing links to developing markets, as well as diversifying into important commodities such as perishables. Capacity was up 6.0%. Latin American airlines saw air cargo grow by a sluggish 1.1% compared to August 2013. The weakness in Latin American freight volumes reflects declines in regional trade activity and the anaemic performance of the Brazilian economy. Capacity expanded 7.6%.
Index to advertisers ALCO-Safe
26
Babcock DAF
16
Cargo Carriers
20
CompuClearing
30
Digicore
40
TWA | Nov/Dec 2014
OBC
FAW Trucks
OFC
Inter Africa
33
Isuzu Trucks SA Questek Group Holdings
4 28
Renault Trucks
IBC
Scania South Africa
IFC
Shell SA Technica Learning Services
3 24
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Collect parcel from 8 Albert St
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Deliver parcel to 5 Short St
Urgent delivery for 23 New Rd
Re-route to Long Ave to pick up load
Accident at corner of Church and Main St
Collect parcel from 45 Hope St
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