Transport World Africa May/June 2015

www.transportworldafrica.co.za ENDORSED BY

Intraregional supply chain solutions from producer to consumer

Corridors

Harrismith Logistics Hub

Warehousing

Impact of e-commerce

Legislation

Traffic Act Amendments

imperial Delivering the goods Mike Fitzmauritz, CEO, FESARTA – Ensuring continuity as FESARTA leadership changes P4 ISSN 1684-7946 May/June 2015 Vol.Mar/Apr 13 No. 2013 3 / R50.00 incl.

VAT ISSN 1684-7946 Vol. 11 No. 2 / R40.00 incl. VAT

A Daimler Brand MBSA/2139/HP5

When anyone can drive your truck and still get a 5% fuel saving?

That’s when you know you own a Mercedes-Benz Proven Actros.

Tested using real drivers in real life conditions, the Proven Actros 2644 and 2654, fitted with RT440 hypoid rear axles, returned an average 5% fuel saving after being driven for two months over 40 000 km across South Africa’s most challenging terrain. Because we sell you trucks, not drivers.

Call 0800 133 355 or visit www.mercedes-benz.co.za/hypoid for more information.

www.tra

nsportworl

dafrica.c

o.za ENDORSED

Intraregion al suppl

Intraregional supply chain solutions from producer to consumer Corrid

or Harrismith Logistics Hub

COVER STORY

REGULARS

2 4 6 8

Editor’s Comment Divided we fall FESARTA Another change for FESARTA Cover Story Imperial Logistics Regional News

Commercial vehicles

mer

Legislat

ion Traffic Act Amendme nts

imperial the goods

Delivering

Mike Fitzm auritz, CE O, FERSA as new lea TA – Ensurin dership ann g continuity ounced P4 ISSN 1684-7

946 May/Ju ISSN 1684-7 ne 2015 946 Vol.Mar/Ap 13 No.r 2013 3 / R50.00 Vol. 11 incl.

VAT No. 2 / R40.00

SUPPLY CHAIN LOGISTICS The pillars of successful IT implementation

11 13 15

Assembler earns its stripes Africaproof A bustling business

Trailers

Rise in TMS adoption Leveraging technology convergence

RAIL

16

Fleet management

17 18 19 21

Telematics recovering well

Vehicle tracking evolves

fuel

CORRIDORs

23 24

When fuel goes missing

tyres Going the distance

26

29 31 32

34

Harrismith hanging

WAREHOUSING Get your warehouse in order

PORTS Ngqura’s deepening impact

Alternative motives

incl. VAT

33

New train of thinking

Cold case

13

cer to consu

p6

this issue

A fight on the cards

sing Impact of E-commerc e

BY

ons from produ

Imperial Logistics – Delivering the goods

INSIDE

Paying the price

Warehou

y chain soluti

legislation

36 37 38

A load of trouble

Air Cargo

40

Air freight soars

24

29 34

38

TWA | May/June 2015

1

editor's comment

Divided we fall T

The wheel deal

he murder of foreign nationals in South Africa is deplorable and indefensible. It matters little what the reasons are. It is pitiful that, after a similar spate of killings in 2008, South Africa’s borders are still so porous. This, despite government’s intention to establish a Border Management Agency (BMA) – mooted by President Zuma in 2009 – to beef up security and plug the influx gaps. Not that the delay in implementing the BMA, or any other border control measure, in any way justifies what has happened since. Nothing can.

The searing irrationality of xenophobia is that the fear of foreigners is almost always baseless. While they may all not be angels, many foreign nationals work hard for South African employers and some open businesses which create employment for local residents. Some bring skills, experience and entrepreneurial thinking with them.

As South African’s, we should be making the distinction between those that are helping the country and those that aren’t, and then commit to learn from the ones that are. On a larger scale, everyone should take the view to promote intra-Africa trade, because it’s far too low. Now would be a good time to check the validity of the working permits of your staff, which you are legally obliged to renew, if expired.

Moving on to positive news, it is heartening to learn that Mike Fitzmaurice will continue the excellent work done by Barney Curtis at the helm of FESARTA. Heading the association is an important job, which he’ll initially perform voluntarily. Mike will, for a time, be assisted in the backroom by Barney and, with this assistance and years of experience in the transport industry, he has the necessary ingredients to excel in the role. I invite you to read what Mike has planned for FESARTA by flipping to page 4.

Now is a busy time for the transport and related industries, with a number of key events taking place across the country in May and June. These occasions never fail to create a buzz, stimulate ideas and put people into contact with one another.

Transport World Africa will be attending SAPICS 2015, Africa Rail/Africa Ports & Harbours 2015, Coal Transportation Africa, the Integrated Transport Systems Conference, as well as the Road Freight convention in the Drakensburg during these months. If you’re attending any one of these events, please come and say hi as we’d love to meet you.

Tristan Wiggill 2

TWA | May/June 2015

Publisher Elizabeth Shorten Associate publisher Nicholas McDiarmid Editor Tristan Wiggill • tristanw@3smedia.co.za Head of design Beren Bauermeister Designer Ramon Chinian Contributors Steven Sutherland, Derrick Wright, Sean Riley, Mark Jaffe & Norton Rose Fullbright Chief sub-editor Tristan Snijders Sub-editor Morgan Carter Client services & production manager Antois-Leigh Botma Production coordinator Jacqueline Modise Marketing and digital manager Esther Le Roux Marketing specialist Philip Rosenberg 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 Glynis Dietrechsen • glynis@3smedia.co.za t +27 (0)11 233 2600

No. 9, 3rd Avenue Rivonia PO Box 92026, Norwood 2117 t: +27 (0)11 233 2600 f: +27 (0)11 234 7274

www.3smedia.co.za Annual subscription: R300 (incl. VAT) subs@3smedia.co.za ISSN 1684-7946 © Copyright 2015. All rights reserved.

All articles herein Transport World Africa are copyrightprotected and may not be reproduced either in whole or in part without the prior written permission of the publisher. The views of the authors do not necessarily reflect those of the publishers or FESARTA.

Page strap

Shell Card.

Your Partner On the Road.

Everything your business needs for on-the-road refuelling, you can acquire with a Shell Card.

Whatever your eet needs, we have a tailored solution for you.

Everything your business needs for on-the-road refuelling, you can acquire with a Shell Card. A convenient and secure way to purchase quality fuels and lubricants and access to a range of other great services. 24 hour access to support and information will provide you with greater control, convenience, security and savings.

Shell Card.

Your Partner On the Road.

TWA | May/June 2015

3

FESARTA COMMENT

Mike Fitzmauritz, CEO, FESARTA

Another change for FESARTA Mike Fitzmaurice, whom many of you may know, has agreed to take on the running of FESARTA.

M

ike and I spent a day going through the operations of FESARTA. As he has been working in the road transport field for many years, he is quite familiar with what we do.

Also, he has his own database, which fits with the FESARTA handbook. Mike will run FESARTA in the same way as I have been doing – that is, on a voluntary basis – until he can make it financially viable. Mike’s own business has carried, and will continue to carry, out projects in the road transport sector throughout East and Southern Africa. I have told him that there is no problem with him continuing this business, provided there is no bias towards any one country. FESARTA considers all countries to be equally important and Mike will need to adopt this position without compromise. I have handed over to Mike the laptop that I used for FESARTA work. This will ensure continuity and provide him with a wealth of information.

I will be in the background, giving guidance to Mike until February 2016. During this time, we can assess how the new arrangement is working and plan the future. I have confidence that Mike will do a good job. I am expecting the harmonisation and non-tariff barrier (NTB) process to be well managed and that the e-corridor handbook and website will be kept fresh and up to date. I am also hoping that the Road Transport Forum will be reinstated and become a beacon for the East and Southern African regions. It deserves a place in the road transport industry. Most importantly, I trust that Mike will provide good service to the members of FESARTA. Let us all wish Mike a long and successful stay at the helm of FESARTA! Please support him.

Barney Curtis The new CEO speaks On hearing the news, we asked Mike what his immediate plans were for FESARTA. He responded quickly, saying the following areas were of immediate concern: T • he harmonisation of transport regulations, vehicle standards, dimensions, overload control/axle limits, Road User Charges (RUC), and transportation of dangerous goods within the tripartite (SADC/COMESA/EAC) region. This remains FESARTA’s number one priority.

• T he managing or reporting of NTBs will continue, with the objective of having these resolved satisfactorily.

• T he updating and maintaining of the African Road Corridors Handbook.

4

TWA | May/June 2015

• The Road Transport Forum, which will be organised in the

•

• •

• •

•

same manner as previous events held in South Africa. With the right support, a forum could be held annually and may even visit other regions within the tripartite.

Continued encouragement of self-regulation from FESARTA members and National Road Transport Associations (NRTAs), including the Road Transport Management System (RTMS).

Revisiting of the proposed RTMS pilot project along the North-South Corridor, in conjunction with SADC. Self-regulation, which is the basis for compliance and uniformity within the transport industry. Therefore, it must be promoted through the NRTAs to ensure all transporters within the tripartite region meet the required operating standards for the region. However, this must be done in conjunction with, and buy-in from, government authorities including the Ministry of Transport and revenue authorities. These authorities must endeavor to ensure improved service and facilities at regional border posts and ports to minimise delays, improve waiting times, and reduce transport operating costs Maintaining and improving our standard of service to our NRTA and corporate members.

Growing the corporate membership to ensure FESARTA’s future sustainability and make FESARTA more resourceful within the region.

Maintaining and strengthening existing relationships with organisations such as the tripartite, sub-Saharan Africa Transport Policy Programme (SSATP) – now known as the Africa Transport Policy Programme – International Road Transport Union (IRU), of which FESARTA is a member, and many others.

Contact Mike at mike@fesarta.org.

Former CEO Barney Curtis (left) and CEO Mike Fitzmauritz (right) at the FESARTA office

Page strap

Partner with a true

global leader

Currently, MiX Telematics monitors over 500,000 vehicles – including trucks, buses and trailers – and records in excess of 800-million kilometres per month. With that kind of power linked to your mobile assets, you too could benefit from optimised driver and vehicle management.

Improve driver behaviour Reduce fuel consumption Enhance efficiency and service levels

For more information, visit www.mixtelematics.co.za

www.mixtelematics.com.au TWA | May/June 2015

5

cover story

imperial logistics

End-to-end solutions The ability to take care of everything, from the point of manufacture to the end consumer, at the point of purchase, has given Imperial Logistics the edge needed to win major contracts over the years.

T

his was once again the case when it netted a two-year contract to move around 190 000 tonnes of frozen vegetables annually, as well as provide state-of-the-art warehousing, for McCain. The scope of Imperial’s contract includes national and crossborder transport and distribution services, cold storage, bulk storage, merchandising, and the complete optimisation of McCain’s transport services.

Partners

ABOVE Leonard Hyman (right), general manager, Imperial Logistics, and Gert Van Rooyen (left), Serco Cape

6

“Rather than just seeking a service provider, global frozen foods specialist McCain was looking for a partner that it could work with to optimise the performance of its supply chain and reduce costs,” says chief business development officer Cobus Rossouw. Imperial’s solution encompasses complete outbound supply chain services customised for McCain. “We took the time to learn about McCain’s challenges and developed recommendations and solutions to meet the organisation’s logistics needs. The size of the Imperial Logistics Group, its specialised operations, and geographic footprint translate into substantial benefits of

TWA | May/June 2015

scale and synergy for McCain. We have been able to offer the company competitive rates and a complete, managed solution,” Rossouw expands.

Optimisation Through group company Resolve Solutions, Imperial is optimising McCain’s transport routes and providing detailed visibility into deliveries. “The result is maximum utilisation of assets and reduced lead times, which is boosting McCain’s competiveness and delivering significant cost savings for our client,” Rossouw states.

Imperial Cold Logistics is the lead logistics provider on this contract, acting as McCain’s single point of contact for the Imperial Logistics Group. Substantial investments in infrastructure have been made by the group in order to deliver a comprehensive, unmatched solution to McCain, including a new state-of-the-art warehousing facility that will be operational in July 2015. “We believe that this will allow Imperial Cold Logistics to offer new, and existing, principals a range of solutions, including fine picking, bulk storage and x-docking in a multi-temperature facility,” explains Rossouw,

cover story who reveals that the company has also invested in new vehicles to meet McCain’s needs, including Mercedes-Benz trucks with 30 Pal Serco trailers and SLX 400 Thermo King fridges. The seamless moving of over 48 truckloads of frozen products to Imperial Cold Logistics’ facilities has been commended by McCain. “We are delighted with the way the move has taken place. What could have been a logistical nightmare was, by all accounts, a flawless transition from one network to another. If the collaboration and coordination of resources shown is any indication of the road ahead for these two market leaders, then the future looks good indeed,” comments Karl Thorington, supply chain director McCain South Africa.

Planning Outlining the scope of the move, Rossouw notes that it represented the culmination of months of planning. “The 48 truckloads of McCain products were moved from 10 locations countrywide, from the Vector network into the Imperial facilities, with stock being meticulously checked and accounted for, before being loaded onto Imperial vehicles and transported to new homes. Activities had been planned well in advance by both teams and nothing was left to chance.

Events were coordinated from a control centre established at the McCain head office in Bedfordview, and any issues arising were dealt with speedily and effectively by a cross-functional project team, representing the collaborative efforts of McCain and Imperial. “Within three days, all inventory had been transferred and accounted for, and orders were being processed by Imperial on behalf of McCain, representing what we expect to be a long and fruitful, mutually beneficial relationship.” Commenting on this partnership, McCain South Africa managing director Rob Stevens says that it is founded on trust. “Belief in one’s business partners is essential to delivering mutually beneficial and sustainable financial results, and we are proud of what we have achieved in collaboration with Imperial. We look forward to great service to our customers. In a rapidly and constantly changing environment, it is fantastic to work with collaborative partners to set new benchmarks in the industry, and McCain is happy to have Imperial as a supply chain partner.

Smoking hot A three-year contract for transport and logistics services was also recently awarded to Imperial Logistics by tobacco manufacturer British American Tobacco (BAT) South Africa. Imperial will act as a single point of contact to execute and manage the warehousing and distribution of 26 billion cigarettes annually for BAT, reports Rossouw. He says that BAT’s decision to consolidate primary and secondary logistics services into one supplier translates into significant benefits that the organisation will derive from a seamless, end-to-end network. Imperial’s competitive pricing also contributed to this contract win, he reveals. The contract renewal represents the evolution of Imperial’s relationship with BAT. “We are proud to have serviced BAT since 2011, and have built a solid partnership

“We took the time to learn about McCain’s challenges and developed recommendations and solutions to meet the company’s logistics needs.” Cobus Rossouw, chief business development officer, Imperial Logistics over the years. This partnership has developed as a result of our commitment to continuous improvement and containing costs, and our ability to efficiently manage BAT’s seasonal demands. During the 2012 public sector strike action, we demonstrated our ability to remain calm under pressure and our unwavering commitment to meeting our clients’ needs, as we ensured that BAT’s deliveries were completed, despite the testing circumstances. We consistently exceed BAT’s KPIs (key performance indicators), and we have been instrumental in the organisation’s drive to contain costs and maximise returns on investment,” he expands.

Safe and secure Security is one of Imperial’s focus areas on this contract, as the trade in illegal cigarettes is an ongoing challenge in the industry. Rossouw elaborates: “The nature of our client’s product means that risk management must be a priority. Product theft and vehicle hijackings are commonplace. Various interventions have already been introduced and we are committed to constantly identifying and implementing risk mitigating strategies and technologies,” he stresses. British American Tobacco South Africa is a part of a global group of companies which operates in more than 180 countries worldwide.

Since its establishment in South Africa more than 110 years ago, BAT South Africa has grown to become one of the foremost fast-moving consumer goods businesses in the country. It has more than 20 brands in its portfolio, including Dunhill, Kent, Peter Stuyvesant and Rothmans. The company employs more than 2 500 people around South Africa, and its factory in Heidelberg produces about 26 billion cigarettes annually for domestic and international markets.

Imperial creates transport solutions no matter the load

www.imperiallogistics.co.za

TWA offers advertisers an ideal platform to ensure maximum exposure of their brand. Companies are afforded the opportunity of publishing a two-page cover story and a cover picture to promote their products to an appropriate audience.

Please call Glynis Dietrechsen on +27 (0)11 233 2600 or e-mail her at glynis@3smedia.co.za to secure your booking.

TWA | May/June 2015

7

Regional News

Read more on www.transportworldafrica.co.za

Angola

Angola to receive 100 locomotives

uganda

China to finance Uganda rail line A proposed 476 km single-gauge railway line that will connect Kampala, via Malaba, in Eastern Uganda to Nimule in South Sudan – at a cost of $3.2 billion – will receive financial backing from China. Official acceptance of the engineering procurement construction contract, handled by China Harbour Engineering Company Limited, has been signed. One of the bottlenecks to Africa’s economic development is high transport costs, owing to the absence of efficient railway transport. Currently, transporting heavy cargo from ports like Mombasa, in Tanzania, is neither cheap nor efficient.

It is hoped that construction of the eastern and northern standard gauge railway line will begin to address the problem. The project has been agreed to by East African states Kenya, Uganda, Rwanda, and South Sudan as an essential infrastructure project for the Northern Corridor. On completion, the new line will connect Mombasa to Malaba (with a branch line to Kisumu city) then travel onward to Kampala, Kigali (with a branch line to Kasese town) and Juba (with a branch line to Pakwach town).

RIGHT C30ACi locomotive supplied by GE Transportation

8

TWA | May/June 2015

Angola is to receive 100 C30ACi locomotives from GE Transportation, having concluded the terms of a contract with the company and the Angolan National Railway Institute (ANRI). The contract dictates that North American GE Transportation will have to train rail staff and supply various tools and services to ANRI as required.

The locomotives are six-axle models powered by 12-cylinder diesel engines that develop approximately 3 000 hp.

The trains will be built in Erie, Pennsylvania, and delivery is expected to take place over three years from 2016. It is envisioned that the new locomotives will increase Angola’s rail capacity, drive economic development, and make it easier to access the country’s interior.

kenya

Revamp underway at Kilimanjaro International The renovation, expansion, and modernisation of Tanzania’s Kilimanjaro International Airport is expected to be complete within 23 months. The €37 million BAM International project will see the expansion of the terminal buildings, the lengthening

and widening of taxiways and runways, the extension of aircraft aprons, as well as the establishment of other essential services. BAM International will also install new airfield ground lighting and floodlights along the aprons, resurface the runways, and create a continuous loop, linking runways and taxiways, to eliminate delays in landing and take-off.

Funding for the project was partly granted by the Dutch fund ORIO. The remaining part is guaranteed by commercial financing arranged by the government of Tanzania.

mozambique

Maputo to deepen access channel The access channel to Port Maputo will increase in depth from 11 m to 14 m, according to the port’s management company, MPDC. The upgrade will give 80 000 tonne vessels access to the port’s facilities.

Dredging of the channel is part of a strategic decision designed to help achieve the set target of 40 million tonnes of cargo – annually – by 2020.

It is the second time that the port’s access channel has been dredged. In 2010, it was dredged from 9.4 m (the depth designed for the channel) to 11 m, which contributed to the amount of cargo handled increasing from 12 million tonnes in 2011 to over 19 million tonnes in 2014.

Page strap

Choose the partner that gets the work done, day and night.

R317 000

15.180 FL 8-TON Chassis cab only

R317 000 excl. VAT. R361 380 incl.VAT.

2 Year/unlimited km Factory Warranty ABS and Aircon 24hr AA Roadside Assistance

21 YEARS IN SOUTH AFRICA!

Success on the move Bethlehem Bloemfontein Botswana Gaborone Botswana Francistown Cape Town East Rand Ermelo

(058) 303-0935 (051) 432-3332 (00267) 3163200 (00267) 2415458 (021) 987-1909 (087) 702-0700 (017) 811-5225

George Harrismith Kimberley Klerksdorp Malelane Middelburg Mthatha

(044) 802-0900 (058) 622-2486 (053) 836-5500 (018) 462-4041 (013) 790-0341 (013) 246-2606 (047) 531-1235

Namibia Nelspruit Newcastle Newlands Johannesburg Pinetown Polokwane Port Elizabeth

(+264) 61 333000 (013) 757-0585 (034) 312-8028 (011) 477-0055 (031) 700-5167 (015) 297-7046 (041) 819-9888

www.faw.co.za

Pretoria East Pretoria West Randburg Shelley Beach Vereeniging Vredendal Wonderboom

(012) 756-5805/6/7 (012) 372-1323 (011) 791-0355 (039) 315-0012 (016) 455-5131 (027) 213-1090 072 110 5678

COMMERCIAL VEHICLES

FAW TRUCKS

Assembler earns its stripes

First Auto Works South Africa (FAW) continues to show faith in the country by

ramping up local production at its $80 million Coega assembly plant. BY TRISTAN WIGGILL

T

he 28 000 m2 plant, which opened in Port Elizabeth’s Industrial Development Zone on 20 June 2014, began preparing for the introduction of the Tiger, a new 4x2 truck, a month before its official introduction in May. The Tiger’s availability in South Africa – and later, in sub-Saharan markets – coincides with its market introduction in China.

Sporting a 141 hp, 3.8 litre Euro 3 Cummins engine and a nine-speed ZF transmission, the National Association of Automobile Manufacturers of South Africa lists the Tiger as a heavy commercial vehicle. It has a payload of just under 9 tonnes and a tare under 3 tonnes. The Port Elizabeth FAW plant is able to produce the vehicle in either right- or left-hand drive applications, and will export some models into the rest of Africa. The manufacturer has 35 franchised dealerships in South Africa and is represented by franchised dealers and non-franchised subsidiaries in, among other African countries, Kenya, Tanzania, Uganda, Zambia, Zimbabwe, and Angola.

Representatives from FAW say that the Tiger, so named for its aggressive pricing, is aimed at smaller transport operators looking for a fuss-free, cost-effective solution. In-house financing can be arranged, if required. Admittedly, the Tiger will face significant competition in the medium commercial sector from Japanese manufacturers, although their models are generally pricier and more technologically complex. That said, the Tiger is equipped with full air brakes and ABS, and

many of its critical braking components bear the internationally recognised E-mark. Taking a fit-for-Africa approach, the Tiger is currently only available with a manual gearbox, although AMT (automated manual transmission) versions are on the cards. FAW also intimated that more models would be added to the line-up at a later date.

The Chinese company’s Coega plant produces medium, heavy and extra-heavy commercial vehicles using leading international technologies, and has an annual assembly capacity of 5 000 vehicles. Importantly, the plant has created and maintained around 300 jobs since mid-2014.

FAW’s truck-body building facility was commissioned in January and has, since, been building tipper bodies from semiknocked-down packs imported from the parent plant in China. These packs are shipped to the Durban port.

While full-bodied tippers roll off the lines at the assembly plant and body shop, the production team is assessing the viability of producing drop-side bodies.

“For the introductory phase, we will commence with a 5 tonne payload drop-side body, which will provide for the lowest cost per tonne on the market,” says Yusheng Zhang, CEO of FAW Vehicle Manufacturers SA. With the Tiger, the manufacturer is attempting to satisfy customer requests for a durable, rugged vehicle with smaller dimensions, to handle the various working environments that call for smaller-sized vehicles. “We believe this segment of the market has great potential and opportunity for growth,” concludes Zhang.

“The Tiger is aimed at smaller transport operators looking for a fuss-free, cost-effective solution.”

ABOVE The Tiger is built to meet the highest international standards

TWA | May/June 2015

11

COMMERCIAL VEHICLES

ud trucks

Africaproof

By placing developing markets like Africa at the top of its agenda, UD Trucks has produced an extra-heavy truck range that is right at home on the continent, as TRISTAN WIGGILL discovers.

T

he move represents a new approach for the company, which, in days gone by, would produce vehicles for its Japanese domestic market and then adapt them to other markets around the world. Not so with the Quester. “The Quester range is the first in a new generation of trucks, specifically developed for growth markets across the world, including the very unique African market,” affirms Rory Schulz, managing director of UD Trucks Southern Africa. It is interesting to note that, for the first time in over 20 years, the company is manufacturing outside its native Japan, with the Quester being built in Thailand. South African units are assembled in Rosslyn, Pretoria Responding to the unique demands of developing markets meant being prepared, which is why development of the Quester started back in 2007. Back then, a dedicated project team travelled to customers in eight developing markets to get feedback, and experience each site’s unique operational environment.

Being part of one of the largest commercial vehicle manufacturers in the world, UD Trucks was able to utilise the company’s global resources, as well as design, technical, and manufacturing expertise from across the globe to develop the truck. Because more than 400 full-time experts from different nationalities ended up contributing to the design, development and production of the range, the Quester is considered a ‘global truck’. UD Trucks says 1.5 million engineering hours and 65 000 test hours were invested in the vehicle before its market introduction. UD Trucks Southern Africa’s Engineering Division also undertook numerous hours of local testing to ensure market suitability and research regional fleet owners’ business requirements.

bumpers and in-vehicle diagnostics. The company promises easy maintenance procedures and sufficient backup and support in terms of servicing and parts availability.

Apart from the 70 franchised dealers in South Africa, the brand has representation in Namibia, Botswana, Swaziland, Lesotho, Zimbabwe, Mozambique, Zambia, Malawi, Uganda, Tanzania, and Kenya.

According to the manufacturer, the two-engine options have been designed with fuel-efficiency and performance in mind. Both feature wide torque bands that UD says are suited to a variety of operating conditions, such as hightraffic scenarios, as well as for operations on tarred and gravel roads. The 8 litre engine is best suited to distribution and construction work, and develops enough power and torque – reliably – for these applications. There is also the option of a bigger, 11 litre engine for those who need it. The engine and gearbox (either 9- or 12-speed manuals) are made to complement each other, combining efficiency and durability with a selection of globally proven drivetrain components.

For the first time, the brand is providing its own telematics tracking system, managed by its call centre, as standard across the range. Schulz explains: “The operations centre will be able to see if a particular driver is continuously driving the vehicle in an efficient manner. If not, the driver can be contacted and the behaviour corrected.”

The Quester range is the first in a new generation of trucks specifically developed for emerging markets

The Quester is the first in a new line of 'global trucks' from UD trucks

Variety Thirteen Quester derivatives are designed to serve the needs of the agriculture, forestry and paper, public utilities, building and construction, mining, and petro-chemical industries, all of which are critical to Africa’s economic development. The Quester can quickly become a competent freight carrier or truck tractor, and is able to serve specific construction applications, such as tippers and mixers. For the first time, the brand is offering 8x4 model options for related subsegments within the market. To make it in Africa, a truck needs to be built to last and be robust enough for day-to-day operations. Evidence of the Quester’s durability can be seen in its three-piece steel

TWA | May/June 2015

13

You’re not buying this.

What you’re buying is so much more than a coach. It’s a commitment. A partnership.

A whole system designed and built around the working life of a vehicle. Founded on the principle that Total Operating Costs are more important than initial purchase costs.

Fuel, as we all know, is the big one. A significant part of the Total Operating Cost over the lifetime of a coach. So it makes more sense to buy an economical coach than a cheap one.

Which is why we make economical coaches. Not cheap ones.

Reliability is a huge deal as well. So you won’t be surprised to hear that Scania coaches deliver the highest levels of uptime in Southern Africa, and our wholly-owned dealer network focuses all its energy on minimising downtime.

Driver capability is another big cost area, which our driver training programmes are tailored to help you manage and develop. The same goes for our finance and insurance approach. We believe in understanding the daily needs of your business, rather than just looking at the risk.

Also our new Fleet Management System is the perfect embodiment of our partnership attitude, giving you access to amazing detail on everything from coasting to heavy braking, and then the coaching support you need to help manage not just your fleet, but your entire cost base.

So if you’re just buying coaches, we’re probably not the supplier for you. But if you believe what you’re actually buying is a partnership, a commitment, a total transport solution, then we should talk.

There is a better way.

COMMERCIAL VEHICLES

scania

A bustling business TRISTAN WIGGILL investigates the reasons behind Namibia’s Sunshine

Tours’ fleet growth – from a single vehicle in 2003 to over 110 today.

F

ounder and managing director, Winston Greyling, tells us that the company is guided by ductus exemplo, which means leadership by example. Setting itself apart has required excellence, he says, which is driven by passion for the industry and backed by experience. Greyling explains that his love for the game was established as a child, since his father was in the same trade.

Passion, hard work, perseverance, faith, and client satisfaction have all contributed to the company’s growth. “Passenger safety is a top priority, although it has to be combined with reliability (within the team and from the vehicles we use). The power of well-trained, trustworthy employees, and sound vehicle maintenance can never be disregarded,” says Greyling.

Sustained growth meant the acquisition of more vehicles, more fixed and non-fixed assets, and the addition of human capital. “The latter will always remain any company’s biggest challenge and biggest investment. It’s important to find people that have a passion for what they do,” he states.

Ensuring the service delivered is the best available requires having proper service level agreements, knowledgeable and trustworthy staff, reliable vehicles, and a willingness to go the extra mile. Since the establishment of Sunshine Tours, over 10 000 000 km have been travelled without any fatal accidents. Staff training is essential, with all fleet operators and drivers receiving certified training in first aid, medical examination, advanced fire fighting, and defensive driving.

In addition, they are schooled in vehicle defect identification, fatigue management and safety equipment use.

They also attend HIV/AIDS and other wellness programmes.

Staff undergo medical check-ups regularly, depending on their medical history. Alcohol testing is done before each and every shift or trip. All operational and depot managers receive training relevant to their specific position by consultants.

Health and safety personnel liaise with and update employees regarding safety policies, procedures and standards, while incidents, near-misses and accidents are discussed.

Sunshine Tours makes use of a specialised fleet maintenance

programme to ensure all vehicles are kept in immaculate condition. A cleaning crew works hard to keep buses in immaculate condition because, as Greyling says, “keeping customers happy means providing unmatched service and a solid track record of reliability.

Exceptionally good remuneration packages and benefits are provided to staff and the company invests a lot in our workforce through training, which is funded by the company.

We always try to encourage a family vibe and demonstrate the importance of teamwork,” he adds. Among its bus fleet, Sunshine Tours uses F95 4x2 and 6x2 Scania chassis, which are fitted with a range of bodies from the Predator, Marcopolo and Irizar stables. The Scania Touring, with the 460 hp engine, has recently been added to the company’s 54-strong Scania-branded bus fleet. Greyling says his company provides buses for hire to corporates, schools, churches, and the tourism industry in Namibia; and he has contracts with a few mines. He bought his first Scania after Freddie Hennop (currently MD of Scania in Botswana) had given him excellent service, which, he testifies, was backed up later by the product itself.

“The current level of service I get from Scania Namibia is unrivalled, with Clifford Marchbank at the helm,” he claims. “We do a lot of parts maintenance on the vehicles and, in a country like Namibia, the only thing that sometimes gets the best of us is the electronic management systems.” He says his customers tell him that his buses are tough, durable and reliable. He describes the Scania Fleet Management System as user-friendly and quick to access from any platform. According to Greyling, the bus transport business environment in Namibia is tough and competitive. “Because of the low volume of fleet clients in Namibia, customer service is paramount. If you don’t deliver, you will fail. We now mainly use Scania in our larger application fleet, as they are well represented within Namibia and they keep stock of all needed and crucial parts,” he concludes.

Over 10 000 000 km have been travelled without any fatal accidents

Reliable vehicles ensure passenger safety and business growth

TWA | May/June 2015

15

trailers

Cold case

learns about the technologies used in the refrigerated semi-trailers recently provided, by Serco, to a leading logistics operator.

TRISTAN WIGGILL

T

he bulk of the operator’s 35 vehicles will be used to service the local needs of a frozen vegetable producer, while three units will operate in Namibia to distribute goods to newly opened food stores there.

Clinton Holcroft, managing director of Serco, answers some questions about the trailers.

Four of the trailers are fitted with Thermoking multitemperature units. Can you explain what these are? What are the pros and cons of these units?

CH By fitting the multitemperature cooler units, it is possible to set different temperatures for different compartments within the trailer. This enables products such as frozen, chilled, and dry goods to be simultaneously transported within one vehicle.

The compartments are separated with an insulated, moveable partition. Benefits include an improved shelf life for perishable goods and the improved utilisation of the trailer by ensuring it is fully loaded. The negative spin-off is that the equipment costs more, and access to products within the compartments is limited.

The rest of the trailers are equipped with standard, single-temperature cooling units. What are the limitations of these units and for what cargo are they best suited? Singletemperature trailers are widely used, as they are cost-effective and, generally, the larger portion of the load only needs one temperature. If products requiring

16

TWA | May/June 2015

different temperature need to be loaded into the trailer, it is possible to use a movable partition to separate dry goods and refrigerated goods, and use separate cold boxes with dry ice or eutectic plates for the frozen goods.

The multitemperature units enable goods to be transported at different temperatures and in different compartments. Why is it important to compartmentalise frozen goods?

If the optimum cold chain is not maintained, product shelf life will be reduced. The risk of spoiled goods also increases.

Separating the load also helps the cooler unit to run more efficiently, as it is primarily designed to maintain temperature.

Two of the trailers are fitted with aerodynamic side skirts, as the client wants to monitor fuel consumption.

Can you tell us what these side skirts are made of and how were they tested to ensure fuel consumption benefits? The side skirts are manufactured from a flexible and durable polypropylene plastic. They are tested on a test track and certified independently. Variables such as tyre pressure, wind, traffic, and driver habits are isolated to eliminate their effect on the results. We did a road test in conjunction with Spar and MiX Telematics to measure

“Benefits include improved shelf life for perishable goods and improved utilisation of the trailer.” the effect and found a 2.5% saving, at an average speed of 68 km/h. At higher speeds, the saving is in excess of 5%. Due to the many variables, transporters generally find it hard to measure a consistent saving and, hence, are often reluctant to fit such accessories. However, with the growing awareness of the need to reduce fuel costs and CO2 emissions, transporters are becoming more receptive to using devices, such as these, that have been proven to save costs for highway travel.

All the trailers are fitted with aluminium rims.

What are the benefits?

Aluminium rims are lighter and enable an improvement in payload of approximately 180 kg.

They are stronger and slightly improve tyre wear.

EBS brake systems have been fitted. What is EBS and why use it? EBS (electronic brake system) is an upgrade on the more widely used ABS (air brake system). It is intelligent and improves the braking efficiency of the truck and trailer combination, which improves road safety.

The trailers use air ride suspension. What are the benefits to using this type of suspension? Air suspension enables the trailer floor height to be adjusted during loading and off-loading for improved efficiency. It also offers a softer ride for the goods transported. This is an advantage, for example, when transporting fruit, as there will be less bruising.

Clinton Holcroft, MD, Serco

IMAGE PLEASE

fleet management

Telematics recovering well digicore

With a 100% recovery rate, Ctrack proves itself to be a market leader in the telematics industry

S

ome noteworthy achievements were recorded in the latest audited statistics on vehicle recovery performance for the telematics industry in South Africa. Ctrack, for example, scored a 100% recovery rate.

The results are compiled by the Vehicle Security Association of South Africa. It provides a recovery rate calculator, into which member companies, with systems classified in telematics categories, submit monthly recovery statistics.

These are then checked and evaluated to produce a recovery rate. This rate is disseminated into the market place and, in particular, to the insurance industry, as an indication of the effectiveness of the services being rendered. The 100% result is astounding in a time when many tracking companies and

the security industry are up against remote signal jamming and other more sophisticated means of vehicle theft. “This performance comes down to our technology and continuous research and development, which we need in order to stay ahead of the criminals. Combined with a passionate and very capable recovery team, we provide solutions that keep our customers’ vehicles always visible,” says Pierre Bruwer, managing director of Ctrack.

The company uses GSM cellular and GPS satellite communications, which allow it to pinpoint a stolen vehicle in real time. This gives a recovery team significant advantage over the tracking companies that continue to use traditional passive radio frequency (RF) based systems. RF devices require activating before they start transmitting a signal and even then, they only supply a general area that needs to be searched in order to uncover a vehicle’s

“This performance comes down to our technology and continuous research and development.”

location. “We have helicopters on hand but, frankly, we rarely need to use them as we will know the exact location of a stolen vehicle, enabling our ground team to get on site rapidly,” Bruwer explains. Ctrack was the first tracking company in South Africa to introduce a jamming detection solution in August 2014.

“We have always focused on providing premium vehicle tracking to our customers as we know someone’s life may depend on it. Today, our GPS/GSM-based tracking solutions are very price competitive with the traditional passive systems, making quality systems accessible to everyone,” he says.

Furthermore, insurance companies look favourably on GPS and GSM vehicle tracking systems, usually offering discounts and lower excess rates to clients who fit their vehicles with one of these security systems.

www.digicore.co.za

TWA | May/June 2015

17

fleet management

Paying the price mix telematics

F

leet managers can answer that question by opting for a solution that benefits the business by addressing the causes of problems rather than merely treating the symptoms. In South Africa, the selection of fleet management products has traditionally meant scouting for the most cost-effective option available. But the risk of this dyed-in-the-wool approach is that price becomes an illusion. When a fleet management decision pivots too strongly around price, operators can lose sight of the bigger picture and the necessity to invest in a tangible, value-added offering.

Too often, cost-effective pricing models exclude key telematics tools, essential customer care and consulting services, contract duration warranties, and bundled on-site service and support. These are the true enablers of effective endto-end fleet management. In addition, cheaper solutions often exclude fuel management, which is a big problem considering that fuel is a major cost factor for fleet operators. Fleet management today is no longer, only about big data anymore: it’s about interpreting that data and knowing how to convert it into tangible actions that will bring about multiple opportunities for operational improvement. What should the determining factors be, when evaluating a solution?

First, examine the real total cost of ownership.

The author

Steven Sutherland is sales director for South Africa and Africa at MiX Telematics

18

TWA | May/June 2015

As pressure mounts to reduce operational expenses and optimise fleet performance, fleet managers are increasingly asking: Is fleet management a necessary evil or a business game changer?

BY STEVEN SUTHERLAND

That is, what will this solution cost in monetary value, time, effort, and resources? In essence, when benchmarking different offerings against each other, fleet managers should consider not only the solution on offer, but, more importantly, the organisation behind it.

Price differential Fleet managers should ask themselves: How big is the price difference between one offering and the next, and what are the reasons for it?

Comparing apples with apples is always a good start. Make a list of what each offering provides and then start dissecting how much value you can derive from each component that’s included. These will cover aspects like data management and reporting, and after-sales support and service delivery. In so doing, you will notice that – more often than not – the more ‘cost-effective’ the solution, the less comprehensive the offering.

A cheap solution does not represent an investment-type partnership, but rather a shorter-term, ‘fit-and-go’ type fix. Comprehensively monitoring and improving driver behaviour, for example, is key to bringing down fuel costs. An average fuel cost saving of 10% can be gained by rectifying bad driving habits like excessive idling, speeding, and over-revving. In addition, harsh braking is often linked to collisions ,as well as unnecessary wearand-tear on vehicles.

As such, by closely monitoring these aspects – often in

real time – there is no doubt that businesses are able to drive down fleet expenditures and remain competitive. Benefits like these don’t come with simply tracking your vehicles and improving routes. The reality for fleet operators is that if they don’t keep up with current trends and proven fleet management solutions, they’ll soon realise they’re under-equipped. And, ignoring the nagging demands of tomorrow may very well mean that business competitiveness and cost-effectiveness are merely mirages in the road ahead. At some point in the life cycle of your business, you will need a more comprehensive fleet management solution and, when that time comes, do you really want to be going back to the drawing board and laying out more money and time for this investment?

www.mixtelematics.co.za

fleet management

shell

A fight on the cards Shell believes that now is the time for fleet operators to get the upper hand in the tussle with fuel card payment fraud. BY DERRICK WRIGHT

D

riven by an ever-increasing minimise the impact of card copying, falsified cutting-edge anti-fraud techniques. Criminal preference for cashless payor hijacked accounts, and abuse of genuine tactics change and adapt, so it is up to ments, the global card payment fuel cards. These solutions can alleviate some companies like Shell to help its partners stay industry has grown considerof the pressure on fleet managers by allowing one step ahead of the game. This includes ably in the last two decades. According to them to focus on wider operational concerns. offering sophisticated technologies, such as CapGemini’s latest World Payments Report, Drivers should be encouraged to use service online systems for real-time fraud detection, there were a staggering 365 billion worldwide stations equipped with on-site security cashless transactions made in 2013. That’s measures and CCTV, as these help to more than 40 for each person on the planet. identify perpetrators.

While cash is still king throughout Africa, the Another way to secure cards is to use of cards for commerce is rising rapidly, eliminate the middle man. Many fuel with the so-called cashless revolution set to cards are managed by third parties that continue for the next decade. are separated from the fleet manager Unsurprisingly, fuel card usage in the com- and fuel provider. By having wholly mercial road transport sector is also on the owned cards, transaction steps are miniand dedicated teams of anti-fraud experts rise. Increasingly, fleet operators are choosing mised. Existing management tools should be who review transactions with current countryto give their drivers the freedom, convenience employed as effectively as possible. This specific and fraud trend knowledge. Both are and control to fill up using a company-funded is especially true for online fuel card soluhighly-effective in minimising the impact of solution. Shell fuel cards are used to complete tions, which can help users analyse transac- criminal behaviour. more than 260 million transactions worldwide. tions according to specific criteria – such Ultimately, the best way for businesses to Fuel cards remain the most secure, efficient as when and where a fuel card is used – achieve payment security success and protect and simple way for drivers to fill up on the and receive personalised alerts if a payment drivers from fraud is to ensure they have the road. But, as more and more payments are occurs outside the normal pattern or exceeds tools and techniques to make life as difficult made, so the number of opportunities for a preset maximum fill-up limit. This, in turn, as possible for criminals. Beyond that, it is organised crime increases. means potentially fraudulent behaviour can only by constantly refining, reinventing and For the fleet industry, the result is millions be detected early and, crucially, allows for a renewing the methods of fraud prevention that of dollars lost every year to fuel card related swift response. The final step is for fleet opera- fleet operators will emerge victorious in the fraud; a problem that affects all countries tors to work with a fuel card partner, offering fight against fraud. and all fuel card providers. In 2013, Standard Bank alone declined R232 million fuel card The author spend for fraudulant activity. Nowadays, fuel Derrick Wright is global can account for up to 30% of a fleet’s running security and compliance costs, so the need for operators to ensure manager at Shell www.shell.co.za card payment security has never been greater. As criminal tactics advance and become better targeted, so the techniques to fight them become more sophisticated. For fleet operators, a range of effective ways to combat fraudulent behaviour already exists. Hi-tech anti-fraud Please provide caption Please provide caption solutions are required to

Fleet operators should work with a partner offering cutting-edge antifraud techniques

TWA | May/June 2015

19

Page strap

www.digicell.co.za 20

TWA | May/June 2015

fleet fleet management management Page strap

digicell

Vehicle tracking evolves The vehicle tracking industry has come a long way. Digicell managing director Rordon Cowley tells TRISTAN WIGGILL about it.

“I

n 2000, Joe Soap didn’t understand a thing about vehicle tracking. People used to believe a tracking device was the size of a R1 coin that you could stick under a car and then track it from an LED display on a wrist watch. Since then, the market has become extremely intelligent and anyone in this space who tries to mislead won’t succeed. Clients do their own research and discover that certain things are impossible,” he says.

Cowley states that, while many people are impressed by cloud technology, the location of tracking data is not particularly important.

“What is important is operator accessibility. It is important for fleet managers to have full control-room software, with total control over their application.” Apart from vehicle tracking, the company is able to track portable products, cargo, and containers using GSM technology.

Keeping it local The company’s Digit product is locally manufactured, designed, developed, produced, maintained, distributed, and supported. Apart from benefiting local businesses, this allows the company to react quickly to new trends and the ever-changing modus operandi of criminals. “A big problem at the moment is the use of cell phone signal jammers, which are becoming cheaper and more readily available. We have implemented solutions to protect our clients against this. By producing locally we are able to keep a very close eye

on quality. We are not selling the lowestcompete for business, pricing will become priced product, while it is very competitively more aggressive. It is highly unlikely that a priced, what you receive is a very high-end single cellular provider will create a monopproduct, as well as personalised, service. oly roaming service as the price is simply Each distributor has a certain customer base too high.” and they communicate on a personal level, each customer can talk to his/her agent.

Trending tech They are not phoning an 086 ‘we-don’t-care’ He believes that development of the vehicle control room.” Cowley says customer needs tracking industry is trend-based. The comhave also changed. pany receives feedback from its customer “The reason people want to track vehi- base, installers and distributors. “As soon as cles is not just to know that they have the feedback comes in, a team of engineers not been stolen, they want to know how starts implementing changes. GSM technolthe vehicle has been driven and where it ogy is also constantly evolving, thanks to is on a route. The core function of telemetry smart mobile devices. This means that more tracking is to know what is going on with advantages are being delivered to clients. a vehicle. Fuel level monitoring and video surveillance add evidence to questionable events.” He says vehicle tracking Rordon Cowley, MD, Digicell has created a habit of enquiry. “People want to know about driver More features are being added while behaviour and vehicle whereabouts. In my products get smaller, more rugged, and are view, the ultimate way to do this is through better designed.” According to Cowley, techlive tracking with parallel video surveillance. nology advancement in the industry is driven "Many people think that the one can replace by the need for more information. the other, but that is not the case; information While the company has a web-based app from the tracking system tells you which porto monitor vehicles on mobile devices, he tion of time to look at in the video footage.” believes that serious fleet managers use a While cross-border vehicle tracking is chalcomputer, desk and chair. Mobile tracking, in lenged by the high cost of roaming data, he his view, is merely a complementary method remains optimistic. “The pricing issue will take and convenient means for people to instancare of itself in time. As the cellular networks taneously check the location of a vehicle.

“It is important for fleet managers to have full control-room software, with total control over their application.”

TWA | May/June 2015

21

Page strap

Discover end-to-end supply chain solutions at the 37th Annual SAPICS Conference The leading event in Africa for Supply Chain Professionals

the pulse of africa’s supply chains

Conference Date 31 May - 2 June 2015 Sun City Register at www.sapics.org.za +27 (0) 11 023 6701

Partner Associations:

Sponsors:

22

TWA | May/June 2015

fuel

Alternative motives

S

outh Africa has been slow in adopting alternative energy sources. There are currently less than 15 filling stations in South Africa that offer CNG or LPG refuelling facilities, and it is strongly suspected that the lack of infrastructure is one of the main reasons why most large fleet operators have not yet adopted this alternative fuel technology. “There would need to be at least 20 to 30 sites in central Johannesburg alone before it becomes feasible to operate a regional fleet on CNG or LPG,” says Murray Price, managing director of Eqstra Fleet Management. The low adoption rate is surprising, given that CNG and LPG both produce substantially lower carbon emissions and significant fuel savings. South Africa has abundant reserves of the stuff, and widespread use would reduce fuel fraud risks.

Some suppliers offer reduced prices based on usage, while VAT can be claimed on CNG transactions as well.

“Despite limited infrastructure, there are solutions available to assist fleet operators should they decide to take this route. Critical mass could be achieved in the next two years if more companies convert to this alternative technology,” Price adds. Sasol has added LPG fuel pumps at certain fuel stations, while mobile filling stations are available to corporates with a fleet size larger than 50 vehicles. The petrol price has shown an average increase of 13% year-on-year, since 2003. With recent price reductions, and with fuel contributing more than 45% of total fleet costs, the use of alternative fuels should already be offering a viable solution to reduce costs and emissions. But, the lack of harmonised codes and standards across international jurisdictions is seen as a barrier to mainstream NGV market penetration. While various South African companies and public sector entities have been working to create a renewable energy strategy, the infrastructure to support alternative fuel use initiatives will have to be expanded exponentially in the near future for it to be viable.

“Critical mass could be achieved in the next two years if more companies convert to this alternative technology.”

Murray Price, MD, Eqstra Fleet Management TWA | May/June 2015

23

TWA | May/June 2015

23

Contact: Craig Pott | Tel: +263 864 411 1223 | Email: craig@africoil.co.zw Afric Oil Petroleum (Pvt) Limited

fuel

When fuel goes missing With fuel being the greatest road transport cost, its use needs to be properly managed and accurately recorded, writes TRISTAN WIGGILL.

T

he most common fuel management system (FMS) currently used in South Africa is a Microsoft Excel spreadsheet – sometimes even when a sophisticated FMS has been installed. This rudimentary approach to the management of fuel makes it difficult to record fuel use accurately. Manually capturing data doesn’t cater to different in-house fuel recording processes and it is very difficult to capture on-road transactions this way. Also, it makes no case for accurate driver management, or provision for general fuel theft challenges.

Fuel theft Fuel is a commodity easily exchanged for cash, which makes fuel theft very tempting. The theft of fuel is also difficult to quantify, as small amounts can easily be taken and, without proper tracking of fuel dispensing events, it is not possible to determine if fuel has actually been lost. Truck drivers tend to blame the loss of fuel on depot staff and vice versa, and the tracking of refuelling events wastes substantial time at fuelling depots. Fuel is stolen at every point in the supply chain, be it directly from the pump, at delivery, or from the vehicle’s tanks. It is also taken in other ways that you may not yet have imagined. A comprehensive FMS can help limit fuel theft, by allowing one to follow the fuel, from initial purchase through to storage and dispensing. There are a host of options

24

TWA | May/June 2015

available, some of which can track processes in real time.

Due to the complexity of FMSs, it is best to work with a fuel management expert. They will ensure that the entire operation is geared towards efficient fuel storage and usage. This includes the monitoring of tanks and dispensing equipment to ensure they aren’t vulnerable to theft, faults, and miscalculations. It is wise to develop specific fuelling policies so that everyone is on the same page. The amount of fuel used per month will impact the decision to use an FMS or not. The cost of an FMS should be compared to the cost of lost fuel in litres. If the FMS costs R10 000 per month and the cost of fuel is R10 per litre, the system only needs to save 1 000 litres of fuel to be cost-effective. “It’s important to take a holistic approach when it comes to managing fuel theft,” says Grant Pedler, CEO at Rigana. “Good management, proper record control, adherence to safety regulations, continual equipment maintenance, and the correct use of quality measurement tools are what’s needed to ensure fuel is used correctly, leaks are identified, and theft or unauthorised usage is minimised.”

Pedler points out that checking product and water levels,

Fuel is a commodity easily exchanged for cash, which makes fuel theft very tempting

fuel as well as product temperatures and densities, should be done when fuel is received and stored. This data is used with conversion charts that are set to a designated temperature of 20°C, to allow you to pick up any variances over time.

Measuring up Measuring fuel consumption manually often means that accuracy is lost due to human error. Inaccurate reporting is likely to proliferate when it comes to recording different consumptions and rates of consumption, since there are many different methods and calculations of doing so.

These include: • kilometres/hours per litre versus litres/hours per 100 km • GPS distance versus odometer distance • manually recorded litres vs automatically recorded litres.

Further complexities of recording accurate consumption include missing, short, and split fillings; inaccurate odometer readings; incorrectly recorded fillings; incorrect target consumptions (which affects exception reporting); as well as the non-monitoring of consumptions. In addition, there are many factors that affect fuel consumption, such as the type of vehicle driven; the type, shape and weight of loads carried; the amount of traffic; wind direction and resistance; truck and trailer aerodynamics; general truck and Qualities of an tyre condition; diseffective fuel tance; route planning; management system and driver style. As one • Reliability can see, it is extremely • Integration difficult to factor in all of •E ffective, rapid and deep-level these issues manually, reporting •E xceptions investigating especially when inte• Accountability grated consumption •V ehicle and driver information reporting is required. for exception parameters Often, filling sites are unwilling to review the practices that affect management reporting, such as who fills the vehicle and when. Also, the way overrides are managed affects a site’s ability to manage fuel. On-road transactions can be hard to control as well, due to the risk of fuel card cloning and the propensity of duplicate transactions. Fixed equipment poses its own challenges, where fuel is being moved from fixed sites, such as with generators, lawnmowers, and compressors.

When it comes to the reordering of fuel, the challenge is to ensure that there is always sufficient supply for operations, while obtaining the best-priced fuel. One will want to avoid late ordering, over-ordering, and short drops. Driver behaviour can greatly affect fuel use and needs to be taken into consideration during driver training. Consider the daily impacts of harsh braking and acceleration, speeding, and improper route planning.

and more effective corrective actions can then be taken.

While automation decreases the need for staff to capture data manually, it does have its limitations. For example, databases rely upon information that is provided by the site and, while they can limit theft, they cannot remove all possibility of theft. Competent staff are required to manage these systems and, while automated systems give better answers, you still need skilled people to investigate, follow-up and make cost-saving decisions.

Stealing small amounts of fuel makes it difficult to notice.

TWA | May/June 2015

25

TWA | May/June 2015

25

Automation for the people Elements of fuel management automation include pump automation, automated tank gauging, reporting and notifications, the integration of data, and the embracing of new technology. Automating the fuel management process creates increased accuracy throughout the data chain, heightens fuel security, allows for speedier reporting, and improves data transfer. Immediate follow-up, investigation,

tyres

Going the distance How do you get more life out of the tyres in your fleet? TRISTAN WIGGILL asks two experts in the field.

T

here are several factors that impact tyre life. A number of these were commented on by Hiroshi Nakanishi, Bridgestone general manager: Field Engineering and Technical Services, and Nobuzwe Mangcu, South African Tyre Manufacturers Conference (SATMC) managing executive.

Driver training HN Professional – and regular – driver training can reduce the behaviours that cause tyre damage and/or premature tyre removal. Such training should coach smooth acceleration and braking techniques. Drivers must be able to review tyre condition and be aware of ideal inflation pressures and wear patterns.

NM Good driver training teaches how to load vehicles correctly (even distribution across axles and proper load securing). Documentation, which indicates the damages seen and the causes thereof, should be kept.

Tyre choice HN Depending on the size of the operation, choosing an established tyre brand and implementing a complete tyre maintenance package can reduce operating costs. Buying products based on price only, without proper maintenance or backup service, can limit cost-effectiveness.

NM Tyre choice must be dictated by the correct tyre and tyre design for the specific application. The correct load/ speed index must be equal to or higher than what is specified as original equipment fitment in the vehicle’s handbook.

Retreads HN Retread tyres can be used as part of a total tyre management solution. Tyres must be monitored to ensure they are removed from service at the correct wear stage in order to be retreaded.

NM Retreads must be sourced from a reputable retread manufacturer. The retreaded size (width) should be as close as possible to that of the original tyre.

Tyre pressures HN For commercial tyres, inflation pressure must be correctly adjusted and maintained according to the load carried.

If a tyre is under-inflated, it can lead to fast shoulder wear. Over-inflated tyres tend to wear quicker in the centre of the tread area. Ensure valve extensions are fitted and accessible, especially for inner dual tyres.

Valve caps must be in place and be kept clean.

26 26

TWA | May/June TWA | May/June 2015 2015

NM In the case of commercial vehicles, the tyre pressures must be maintained for the load carried. Always check your tyre pressures when the tyres are cold and do not bleed tyres to reduce air pressure. Rims should be checked regularly for damage/cracks and cleaned. Use valve caps with a rubber grommet inside or valve extensions (ensuring that both the tyres fitted in a dual application can be correctly measured, and air pressure maintained).

Wheel alignment and balancing HN Proper and regularly planned alignment and tyre balancing for both truck tractor and trailer ensure even tread wear.

NM Regularly check wheel alignment and balance. The balance of the tyre/rim assembly is critical to achieving good wear profiles.

TPMS and wear indicators HN Implementing a tyre pressure monitoring system (TPMS), either as part of normal scheduled fleet maintenance checks, or by means of an on-vehicle system monitored and regularly inspected, will assist in ensuring proper tyre inflation. Tyre tread wear indicators (TWI’s) provide a visible means of checking tyre wear, without the need for tools. A TWI can provide a clear indication of uneven tyre tread wear.

NM A TPMS will warn you if your tyre pressures deviate from a specified pressure. Immediately correcting the inflation pressure is critical. Always check your tyres to ensure that the remaining tread depth is not below the tread depth indicators (1.6 mm).

TWA tips •M odern tyres have a built-in wear monitoring system called the tread wear indicator (TWI). The TWI is a raised section moulded into the grooves of a tyre. There may be several TWIs around the tyre’s circumference and they can be located by finding a small triangle marked TWI on the shoulder of the tyre. The triangle points towards the TWI. The TWI is approximately 1.6 mm high and, when the tyre has worn down to the point where the tread blocks are level with the raised TWI, it should be replaced. If a tyre has reached level with TWI, it is already illegal in terms of the Road Traffic Act. •F leet managers must consider various metrics, such as overall tyre life, cost per kilometre, retreadability, warranty, and price.

• T o date, over 350 filling stations in South Africa offer free nitrogen top-ups.

tyres

We go the extra mile to adhere to the laws and regulations of the countries we operate in.

State-of-the-art control centres track, monitor and manage entire fleets across Southern Africa.

OEM accredited in-house workshops along transport routes ensure our fleets are maintained 24/7.

Our drivers receive ongoing training and support to maintain the high standards we set ourselves.

Innovative technology, vehicle tracking, on-board computer analysis and contracted specialists monitor safe driving patterns to deliver real-time performance on and off road.

RTMS accredited, Barloworld Transport is committed to the highest international standards of safety, governance and risk management.

Smart Partnerships Smart Partnerships form the cornerstone of creating a competitive advantage for our clients allowing us to create a portfolio of business units, each with a unique brand positioning tailored to a specific industry. This is why we are able to offer a range of flexible, sustainable transport solutions for companies across sub-Saharan Africa.

Placing strong emphasis on safety, risk management, sector specialisation and operational excellence, we are committed to exceeding your transport expectations, every time.

6104

Contact Barloworld Transport to find out how our innovative solutions can benefit your business.

Tel +27 33 395 7400 | Email info@bwtrans.co.za | www.barloworld-transport.com

Page strap

3PL & 4PL Warehousing Software Solutions - RF Guns - Full Financials - Fast Implementation

COMPUCLEARING ONE PARTNER

+27 11 012 8777 info@compuclearing.za.com www.compuclearing.za.com

28

TWA | May/June 2015

supply chain logistics

compuclearing

The pillars of successful IT implementation A supply chain is made up of many links and, as the saying goes, a chain is only as strong as its weakest one.

I

magine, for a minute, all the different links involved in a supply chain – from manufacturing to order placing, to pick up and transport, warehousing and distribution, container packing, customs clearing and forwarding… the list goes on and on and we haven’t even considered the unique challenges faced by African and/ or cross-continental deliveries.

Only through expert choreography, communication, transparency, and visibility will jobs like these get done right. It is critical to strengthen the links in the chain and deliver on KPIs with the right people and systems in place at each and every stage in the chain. This dictates that a quality system should optimally manage every process, including documentation and communication, and provide complete visibility. The strength of the physical supply chain, therefore, depends very much on the strength of the information supply chain.

By integrating powerful IT systems, different efficiencies can be created. Duplication can be reduced and inaccuracies eliminated. Full integration reduces the amount of resources that are required to complete a job, thereby reducing costs.

While highly competent partners are vital, adequate IT systems and system management tools are equally important. An appropriate IT system must allow for data to be shared among all players, at all times. “We live in a global village and by reducing supply chain costs, we reduce the costs incurred by all parties within the chain,” says Nachi Mendelow, business development manager at CompuClearing.

To know and do “We’ve learnt how to implement end-to-end software solutions for a range of companies, with different needs, all over the world. Successful IT implementation requires business strategies that actively drive IT strategies. “Companies must understand what their business goals are, and then understand how logistics software can be used as a tool to enable the processes needed to reach their goals and business strategies,” he says. “Process design is an important aspect of IT. It is crucial to understand the businesses’ processes in order to avoid automating the wrong ones. Businesses must not only focus on the hardware and software aspects, but also on the human element. It is necessary to enable people to use a system that drives value. “Because Africa is unique, and challenged by institutional voids such as a

general lack of infrastructure and unreliable electricity supply, your chosen IT system needs to offset challenges by having the necessary solutions in place to address them, so as to always be accessible, visible and communicative. IT providers must understand their customers and assist them with their business processes. They must train the team and the support staff involved. “CompuClearing offers software

“IT providers must understand their customers and assist them with their business processes.” Nachi Mendelow, business development manager, CompuClearing

solutions to the clearing and forwarding industries, with free scheduled training on all of its systems. Through its partnership with WiseTech Global – the providers of CargoWise One – it has become an all-encompassing logistical supply chain solution provider that operates on a single platform.

This ensures shareability and visibility at all times, and during all stages in the supply chain. Improving productivity is at the heart of our philosophy,” states Mendelow. The company serves numerous businesses in Africa, which is currently experiencing a renaissance in growth. “We have a strong belief that a strong continent, needs strong countries and strong countries need strong companies run by strong individuals. We strive to empower individuals and companies to enable growth and productivity improvements,” he concludes.

Successful IT implementation is vital to any logistics operation

TWA | May/June 2015

29

supply chain logistics

transnova

Rise in TMS adoption Cost-effective software, such as a service-based transport management system that is quick to implement, is gaining popularity in South Africa, writes SEAN RILEY.

P

erhaps no other supply chain application offers as many ways to drive value as a transport management system (TMS).

A few years ago, the ARC Advisory Group surveyed over 50 companies that had implemented a TMS to understand the return on investment. Over 40% of respondents reported freight savings of between 5% and 10%, while 23% reported freight cost reductions of over 10%.

Arguably the most important chart in this report showed the key areas where a TMS can reduce a shipper’s transport spend, and the potential cost reductions driven by those different savings buckets (Figure1). But there are so many ways a TMS can drive logistics savings that trying to drive savings in all areas in an initial implementation might greatly increase the chances of having a failed implementation. So a key question arises: on which areas should a company focus initially?

This depends partly on a company’s strategy, but it also makes sense to focus on areas where the savings potential is greater and the chances of failure lower. The following table shows our analysis of the risks and rewards Table 1 Indicative TMS savings

associated with driving transport savings in the different areas. In a few of the categories, the risk described is 'easy to difficult'. In these categories, it is easy to drive a certain level of transport savings with basic functionality, but difficult to implement the most advanced functionality. For example, routing is one of the two areas in which the largest numbers of respondents get their savings. Outbound,

data on all the moves, made by all clients, on all lanes. Customer data is aggregated in a manner that protects the privacy of individual shippers, while allowing for the creation of lane benchmarking rates.

Customers are, therefore, able to access current lane benchmarks, as well as historical trends – a vital tool for optimising the transport network and negotiating the most competitive rates. In South Africa, cus-

“Perhaps no other supply chain application offers as many ways to drive value as a transport management system.” multi-stop truck load routing is the most common form of routing, and its prevalence suggests that most TMS suppliers do not have problems supplying savings in this area. However, jointly routing inbound and outbound shipments to reduce empty miles, or jointly routing carriers and private fleets, can be very complex.

In these different savings categories, a TMS achieves savings based on visibility, process enforcement, analytics, and optimisation.

Visibility is a key driver of transport savings.

This is made possible through a multi-tenant, network-style TMS that captures anonymous

tomers can now access this same capability. As an example, a company, whose initial focus was to use the TMS for tendering, routing and optimisation, could harvest the information from its TMS to drive better transportation procurement.

Working with TMS full-service providers, companies can leverage managed procurement services and benchmarking data. This can then be used to compare the rates being offered by the carriers to industry benchmarks. When it comes to visibility like this, as a driver of transport savings, it is hard to beat the new breed of network-based, 'software as a service' TMS solutions.

The author

Sean Riley is chief operations officer at Transnova

TWA | May/June 2015

31

supply chain logistics

sunstone

Leveraging technology convergence

T The author

Mark Jaffe is owner of Sunstone Logistic Systems

32

BY MARK JAFFE

HE distribution system of a bottling company had components from multiple vendors that were proving difficult to integrate and information was not provided timeously for effective decision-making. Through partnership with Sunstone, a real-time, holistic view of the distribution operation was gained, and a more scientific approach to planning implemented. To remain profitable and competitive, companies are required to make faster strategic and operational decisions. The difficulty in this case was gathering, interpreting, and analysing data from multiple vendor systems to answer questions about the size of fleet needed, whether external resources were required, and how sequencing and routing deliveries could minimise cost.

All this was to be achieved in a dynamic environment with seasonal demand variations, rising fuel and transport-related costs, an increasingly competitive market, scarce IT and planning skill sets, and increasing customer service demands. To this end, a set of fully integrated route-to-market distribution tools were implemented, including:

• FLO, a fleet route optimisation and scheduling application • Sunstone Telematics, an advanced telemetry platform • ControlHub, a real-time, cloud-based distribution KPI and management dashboard.

Sunstone engaged with the customer, fine-tuning master data, and adapting scheduler settings and road network speeds to ensure the system's daily routes were efficient and feasible. This reduced travel distances and resource requirements, while maintaining customer service demands. ControlHub provides a live ‘planned vs actual’ view of distribution operations. By combining scheduled delivery information with actual vehicle tracking data, it intuitively provides numerous KPIs, such as planned vs actual distance, customer hit rate, and depot departure times. This gives managers a bird’s-eye view of the delivery progress, with visual maps, Gantt charts, and automated debrief reports. Thus, distribution operation visibility has been increased throughout the organisation. With a unified KPI measurement tool, it has encouraged a constructively competitive atmosphere at all levels: depot, region, and country.

TWA | May/June 2015

Sunstone Logistic Systems Sunstone Logistic Systems is a transport route optimisation company specialising in transport management software and solutions.

Tracking and Software Systems Sunstone Logistic Systems is a transport and route optimisation company specialising in tracking and transport management services and products for the African market.

Sunstone has over 10 years of experience implementing, consulting and supporting diverse logistic solutions in Africa's complex logistic landscape for leading international companies and small-to-medium enterprises alike.

Take your planning and route execution to the next level.

ControlHub provides advanced visibility and distribution metrics through a business intelligence dashboard, providing real time operations analysis in today’s dynamic environment.

Contact Us If you require further information or would like to set up a meeting for a demo of any of our products, please feel free to contact us using the contact details below:

Email: info@sunstonels.com | Contact Number: +27 (0)71 015 0894

rail

New train of thinking

I

magine a train that can travel 600 kilometres in under 40 minutes, is safer than conventional passenger transport, and provides a cheaper alternative to flying. Well, imagine no more. The Hyperloop is set to become a reality in 2016 thanks to Dirk Ahlborn, and the vision of Elon Musk.

The two aim to create a new type of transport that would shoot capsules of passengers along a tube at around the speed of sound. As the CEO of Hyperloop Technologies, Ahlborn will help to develop and fund the project, at the request of Musk. He will use his practical experience to bring the project to life.

Super-speed tech At first sight, trains and Formula 1 cars may not seem to have much in common. But, a breakthrough for the rail sector, led

by Newcastle University’s NewRail rail vehicles group manager and senior researcher, Conor O’Neill, and his team, is changing the entire landscape by adapting technology most commonly found in high-performance racing cars. O’Neill prides himself on decreasing costs and increasing efficiency in rail. He holds a patent for a lightweight, self-correcting, energy-absorbing device for railway applications.

Smooth operator Internet coaching Now, in the era of technological disruption, the need to keep up with innovation is becoming more and more fundamental to operational success. But what happens when technology, the Internet, and rail come together?

Are you prepared for the Internet of things in rail? The Internet of things is a computing concept that describes a future where everyday physical objects will be connected to the Internet and will be able to identify themselves to other devices.

The journey to becoming a world-class rail operator is usually a difficult one, but not for transport planning consultant Howard Smith. His primary focus is to use innovation to provide world-class customer experience, infrastructure, and operational success. Smith, an internationally recognised rail expert, has helped raise £3 billion in investment for London Rail. He, like O’Neill and Ahlborn, will share his insights to local audiences when Africa Rail 2015 rolls into the Sandton Convention Centre on 30 June.

The compact interior of a modern train in Dubai

TWA | May/June 2015

18th Annual

33

5000 attendees

30 June - 1 July 2015

300 speakers

2015 BROCHURE RELEASED

600

visit www.terrapin.com/africarail delegates

18 The earlier you book, the more you save

years of business success TWA | May/June 2015

33

CORRIDORs

Harrismith hanging The Harrismith Logistics Hub (HLH) was identified in 2006 as one of five key transport projects to be undertaken by government. TRISTAN WIGGILL checks in on the progress.

H

arrismith is geographically well placed within the heavily used Durban-Johannesburg transport corridor. The freight corridor forms the backbone of South Africa’s freight transportation network, and is vital in facilitating economic growth for the country and the Southern African region.

Planned upgrades to the corridor led to talks of the formation of the HLH, a project that falls under government’s Accelerated and Shared Growth Initiatives (AsgiSA) programme. It was, and still is, believed that the HLH would improve the Durban-Gauteng corridor, enhancing regional freight supply and contributing to local economic and social development. In July 2007, a resolution was taken to put a portion of land in Hardustria under moratorium and it was reserved for the development of the hub. The land is adjacent to the N3, and the moratorium still stands today. With the launch of national government’s Strategic Infrastructure Project (SIP2) in July 2012, through the Presidential Infrastructure Coordinating Commission (PICC), the HLH became clearer on the radar screen of government’s

national agenda, and the intervention on the N3 bypass, and the solution thereof, became a mandate of the Durban-Free State-Gauteng Logistics and Industrial Corridor.

Prime position Harrismith is situated almost midway between Johannesburg, the largest industrial complex on the continent, and Durban, the largest general cargo and container port in Africa. It is within just-in-time trucking distance of the Gauteng and Durban metropolitan areas, and is located on the N3 major national toll road. Furthermore, it is either directly or indirectly linked to the N5, N1, N6, N8, N9, N10, N11, and N12.

It is also placed at the intersection of the N3 and the N5 national routes, the latter running 200 km westwards, through Bethlehem to Winburg, where it intersects the N1 route to the Western Cape. Traffic between Durban and Cape Town, as well as traffic between Durban and the western and north-western areas of South Africa and adjoining countries, utilises this route. The N5 (HarrismithWinburg corridor) provides a natural transportation corridor to the eastern seaboard for traffic from the industrial areas of the Free State – such as Bloemfontein, Welkom and Bothaville – and Lesotho, all of which are within approximately 300 km of the town. Extensive development of facilities and services required by

The HLH would improve the DurbanGauteng corridor, enhancing regional freight supply and contributing to local economic and social development 34

TWA | May/June 2015

CORRIDORs

where the goods are processed and packaged for national distribution and export. Most processed goods entering the Free State also come from Johannesburg. A new purpose for the HLH was considered by the Free State government, which would see the HLH become a distribution hub of commodities and bulk, with an inland customs clearing point of goods on the route between the harbours on the south coast and Gauteng.

An intermodal hub on the corridor will allow containers to be transported to Harrismith from the port of Durban, where they would be opened and cleared, and the contents distributed throughout the country. Another consideration would be to establish an agro-processing park in conjunction with the HLH. From a quality preservation perspective, it would be better for goods harvested in the Free State to be processed straight away in the Harrismith area, instead of being processed hours later in Johannesburg.

The provincial government and the Free State Development Corporation say they are in an advanced stage of establishing a food processing industrial park in Harrismith. This park is intended to host a number of companies and will accommodate logistics service providers, warehousing, cold storage, and manufacturing facilities.

Rail

trucking companies and their staff have been formed, due to high levels of road freight transport activity on the national routes through the town. The Durban-Gauteng corridor consists of key developmental components, including the port of Durban, the Durban-Gauteng road corridor, and the Durban-Gauteng freight rail corridor.

Feasibility “The current feasibility study for the Harrismith Hub, which is a public-private sector participation process, is underway and is expected to be completed in June 2015,” says Minister of Transport Dipuo Peters. “Through the SIP2, a resolution was taken that a task team be appointed to deal with this long-outstanding N3 De Beers Pass and Harrismith Hub matter, and an alignment towards a win-win solution be found and reported back by June/July 2015. This task team process has started,” she says. A pre-feasibility study was carried out in 2007/8. At the time, the hub was intended to become a cargo handling point from road to rail between Durban and Gauteng. However, it was determined that getting cargo off the road and on to rail in Harrismith would not benefit the value chain, but merely increase costs within it.

Logistics Currently, goods harvested in the Free State are moved to intermodal hubs, such as those in City Deep, Johannesburg,

The Free State is very well supplied with rail infrastructure, and Harrismith has a direct electrified 1:50 graded line that connects to the Natcor main line at the Danskraal (Ladysmith) junction. To the west, the line from Harrismith links to the Free State and Cape rail systems. The KroonstadBethlehem-Ladysmith main line runs a distance of 333 km, with Harrismith located 232 km east of Kroonstad and 101 km west of Ladysmith. The railway is single-track and electrified.

From Johannesburg, the rail link goes along the N3 up to Cornelia, where it stops as a dead end. If the rail line between Cornelia and Warden is linked up and allowed to run along the road corridor, it would reduce the direct costs of transport between Johannesburg and Durban, and provide seamless interaction between road and rail on the most important freight corridor in the country. This would not only result in an immediate decrease in transportation costs, but it would also stimulate rail transport as opposed to road, and allow accessibility on a far wider scale from rural areas within the eastern Free State.

With a growth projection of 38% by 2020, the DurbanGauteng corridor will experience severe pressure on both road and rail systems. It is for this reason that implementation of large-scale upgraded infrastructure projects has been announced, covering the total length of the corridor.

The overriding argument for the development of a central logistics hub in the Free State is a need to eradicate traffic congestion caused by heavy haulage transportation on the N3 national route.

It is possible for the HLH to provide multinodal transportation logistics (air, rail and road) capabilities. There is little doubt that importers, exporters, and shipping companies would be interested in such a development; but government, both national and provincial, first has to clear the apparent administrative backlogs and, frankly, get on with it.

OPPOSITE A stretch of the N3, near Harrismith in the Eastern Free State

TWA | May/June 2015

35

warehousing

Get your warehouse in order looks at the current state of warehousing in South Africa, from an e-commerce and automation point of view.

Tristan Wiggill

Reasons to automate •W ages increasing above inflation • Unrealistic Union demands • Restrictive labour laws •S cope of chronic disease among workforce • Municipal costs increasing • Electricity prices • Higher rates and taxes • Inflation

Warehouse automation should lead to increased efficiencies and costeffectiveness

36

U

nlike in the US and China, e-commerce in South Africa is a small industry, with many people still enjoying the traditional shopping centre experience. However, Internet shopping is gaining popularity, with e-commerce businesses roughly doubling their sales every four months. Sooner rather than later, these brick- and mortar-less businesses will pose a threat to traditional enterprises. The rise of e-commerce has already changed certain industries for good, such as is the case with music distribution.

‘Click and collect’ has become a buzz phrase. As Martin Bailey, chairman of Industrial Logistics Systems, puts it, “Father Christmas no longer comes down your chimney, he comes out of your computer”. The advent of e-commerce means that delivery trucks are starting to look different, too, with smaller deliveries taking place more often.

E-commerce is all about delivery, since online shoppers have high demands and expect greater customer focus, increased speed, and better accuracy. Delivering the right goods on time is a big e-commerce priority. Takealot has made it known it wants to be able to deliver goods on the same day they are ordered if orders are received before 12:00. This places ever greater demands on warehouse and distribution centre efficiencies.

these people,” emphasises Bailey. Automation means different things to different people. To some, it means moving to barcode scanning; to others, it means bringing in robots.

Automation is best suited to lots of repetitive tasks, where high levels of accuracy and throughput are required and where rapid response is necessary. There is lots of automation happening in the pharmaceutical industry. Hard automation means incorporating fully automated storage and retrieval systems.

The advantage of this for businesses is that it can be written off as equipment. There are not many automation-guided vehicles in South Africa due to extreme labour objections – perhaps not surprising when you consider that these vehicles could easily remove 50% of the manpower from a single warehouse. Automation, though, doesn’t always work; Amazon’s use of a Kiva robotics system is a case in point.

But despite the risks of failure, automation is becoming more desirable as it becomes cheaper and more flexible. However, for South African companies, automation is still very expensive and remains hard to justify.

The type of vehicles warehouses use, and the way they are loaded, has a significant effect on costs. Positive moves continue to be made, including the development of side-loading trucks and multi-deck trucks. Trucks are getting lower to the ground while having taller trailers for increased capacity.

Swap-bodies are allowing vehicles to leave staging areas quicker. In Europe, the trend has been toward double-decker trucks and longer trucks.

Truck length has been increased in most European coun-

Automation

tries, with Euro-combis measuring 25 m in length allowed on certain routes. However, bigger trucks create space and manoeuvrability issues within yards. Ultimately, there is a need to move away from traditional transport systems and towards hybrid and/or electric vehicles. For now, drone deliveries are out of the question in South Africa as they’re illegal.

With an excess of labour, we often scratch our heads about implementing warehouse automation in South Africa.

“Government says we have a working population of 33 million people but that is likely under-estimation. It says 25% are unemployed, but the reality is closer to 40%, with more than 50% of the youth jobless. We need to employ all of

TWA | May/June 2015

ports

Ngqura’s deepening impact In March this year, public enterprises minister Lynne Brown officially opened berths 3 and 4 at the Ngqura Container Terminal in Coega.

TRISTAN WIGGILL finds out what this means for the Eastern Cape.

T

he two berths were opened as part of Transnet’s ongoing drive to expand capacity at the port. The berths have been deepened to 16 metres, while cranes, rubber-tyred gantries, and special trailers have been incorporated, thus enabling Ngqura to service larger ships, including cellular container vessels. The total investment made by Transnet in the Eastern Cape currently stands at around R30 billion, with its total investment in South African ports amounting to about R90 billion. Some R210 billion of Transnet’s R300 billion, seven-year Market Demand Strategy budget is being spent on rail, while the rest goes to ports. “At Transnet, we are focused on the projects, and we make sure that we try to deliver on them. We have very ambitious plans. We are audacious and we try to deliver on our audacity,” stated former Transnet Group CEO, and now interim Eskom CEO, Brian Molefe, at the time. Approximately R12 billion has been spent on Ngqura over the last three years, with the result being the near doubling of its operating capacity.

The terminal’s handling capacity has subsequently increased from 800 TEU’s to 1.5 million TEU’s per annum. “This is a significant milestone that Transnet has achieved in its drive to develop the port into a transhipment hub in the southern hemisphere. This achievement will increase South Africa’s competitiveness, especially in relation to other ports on the continent, which are in direct competition with South Africa for the movement of freight. It will also contribute greatly to the integration of our country with the rest of the region and with the continent,” stated Brown.

There are plans to move the manganese terminal from the neighbouring Port Elizabeth harbour to Ngqura, which would be a significant employment and exportation coup for the port. While capital investment is essential to growth and capacity expansion within the port, it’s the people who are the key components in its efficiency drive. The port has

already created 800 permanent jobs in the Eastern Cape. “[The port] is a real success story for one of South Africa’s state-owned companies, Transnet. [The latest investment] means more jobs and greater economic growth, and it also means there is greater port efficiency,” Brown confirmed.

Initially, the port relied on human capital provided from other harbours within the Portnet Group. However, this was not sustainable in the long term, as staff were only on temporary deployment. Transnet then decided to develop an initiative with the chief harbour master to employ home-grown employees.

With the employment focus placed squarely on the Eastern Cape, it was decided that, annually, two learners would be offered bursaries to study at the Maritime School of Excellence before commencing work at Ngqura.

However, it has not been all plain sailing, with a major, consistent obstacle being electricity supply constraints.

These constraints have meant that smaller, less energy-intensive downstream industries have been preferred to larger anchor tenants in the Coega IDZ. There have also been disruptions through strikes, although those have primarily been limited to other projects within the Coega IDZ. Ngqura experiences significant long wave effects and strong winds, particularly in the winter months, which frequently cause berthed vessels to move excessively, which impacts on cargo operations, safety, and efficiency. To address this, an automated mooring system has recently been implemented in Berth 1 and, depending on how successful it is, may be used in Berths 3 and 4. A significant part of what is happening at the harbour will feed into the greater community in the region, and further up north into other provinces.

“We have very ambitious plans.

We are audacious and we try to deliver on our audacity.” Brian Molefe, former Transnet Group CEO TWA | May/June 2015

37

legislation

A load

of trouble Are you a haulier or consignor who transports more than 500 megatonnes of cargo a month by road? If so, brace yourself, says multinational law firm Norton Rose Fulbright.

T

he National Road Traffic Regulations Act 1996 has been amended by the Minister of Transport, and all regulations came into operation on 31 January 2015. The amended regulations deal with a wide range of issues, but this article will focus on those that relate to the carriage of goods. One of the issues that the regulations have sought to address is that of overloading, which is to be welcomed.

A person operating a motor vehicle on a public road that carries goods must be in possession of a written declaration containing the following information: • the license number of each vehicle or combination of vehicles • the nature and quantity of the goods transported • the contact particulars of the operator or, in the case of a combination of vehicles, of every operator in the combination of vehicles • the particulars of every consignor and consignee of the load or loads.

In addition, the operator must be in possession of a written agreement between the consignor and operator for the ‘transportation of goods’ and a schedule of insurance.

minibus or bus) designed or adapted for the conveyance of goods on a public road and includes a truck-tractor, haulage tractor, adaptor dolly, converter dolly, and breakdown vehicle. An ‘operator’ is not defined. We understand the operator to be the road haulier.

A ‘consignee’ is the person who is named, or otherwise identified, in the declaration as the intended consignee of more than 500 000 kilograms of goods transported by a goods vehicle in a month, and who actually receives such goods after they are transported by road. A ‘consignor’ is defined along similar terms, as a person: • who is named or otherwise identified as the consignor of the goods in the declaration relating to the transportation of more than 500 000 kilograms of goods in a month by road; or • who engages an operator of a vehicle to transport the goods by road or has possession, or control, of the goods immediately before the goods are transported by road; or • who loads a vehicle with the goods for transport by road at a place where the goods are stored in bulk or temporarily held but excludes: the driver of the vehicle, or any person responsible for the normal operation of the vehicle during loading.

Definitions

Written agreement

The regulations define a ‘goods vehicle’ to mean a motor vehicle, (other than a motorcycle, motor tricycle, motor car,

The declaration must contain information that includes a written agreement for the transportation of goods entered

Declaration

38

TWA | May/June 2015

legislation into between a consignor and operator. The written agreement must state the following: • the nature of the agreement • the loading instructions • the responsibilities of the parties.

The consignor and operator enter into a written agreement prior to the consignor or operator hauling the goods on a public road.

Compulsory insurance The declaration must include a ‘schedule of insurance’, in terms of which the consignee or consignor ‘insures’ the goods to be carried on the motor vehicle and liability that might arise from the transportation of the goods.

Regulation 330D prohibits a consignor or consignee from transporting goods on a public road or accepting the goods unless “such transportation is fully insured for damages that can occur as a result of an accident”. It is not clear what ‘fully insured’ means. It is probably too vague to be enforceable. There are different risks involved with the transportation of goods. A road accident can cause damage to the carrying vehicle, the goods, road infrastructure, vehicles driven by other road users, and pedestrians.

If harmful substances are spilt on the road as a result of a collision, major damage can be caused to the environment. An accident can give rise to indirect damages, such as economic loss caused by the delay of the delivery of the cargo. This list is endless and not every possible loss can be insured.

Carriers and consignors should procure the cover reasonably required of a carrier in the circumstances: a cargo owner should have goods-in-transit (GIT) insurance in respect of his goods and the carrier should have carrier’s liability insurance and motor vehicle insurance. The Regulation does not distinguish which insurances the consignee or consignor is obliged to take.

Excluded dangerous goods A consignee or a consignor of dangerous goods, in terms of Regulation 273, is expressly excluded from these definitions. Chapter VIII under the Act deals with the transportation of dangerous goods and substances by road.

Overloaded vehicles A consignor or consignee is prohibited from offering goods or accepting goods, as the case may be, if the vehicle is not loaded in terms of the Act (Regulation 330A(1)). The consignor must obtain from the operator a written submission as to the payload of the vehicle and the distribution of the load on the vehicle (Regulation 330A(2)).

The regulations also require the consignor to have a method of determining the mass of a vehicle and any axle or axle unit of such vehicle so as to ensure that the vehicle axle or axles are not overloaded in terms of the National Roads Traffic Act (Regulation 330B(1)). A consignor is now obliged to keep a record of the mass of every load transported from his premises (Regulation 330B (2)), which must be made available to any traffic officer upon demand (Regulation 330B (3)). The regulations also prohibit a consignee or consignor from concluding a contract with an operator if the vehicle is overloaded (Regulation 330A (4)).

These additional obligations that the regulations impose on a consignor are breathtaking when one considers what facilities a consignor would need to have access to in order to comply with these obligations, e.g. weighbridges and other mass-measuring apparatuses.

Once again, it is not clear how a consignee would know whether the vehicle is loaded in accordance with the Act, or what additional steps the consignee would need to take to ensure compliance, presumably on the part of the operator, with the Act. The regulations create a further anomaly and assume that the time of entering into the contract to transport the goods occurs at the same time the goods are loaded. In practice, these contracts may be entered into well before the goods are loaded onto the transporting vehicle.

If the operator ‘breaches’ the contract by subsequently overloading the vehicle, the consignee may arguably have no right of recourse against the operator. One of the requirements to enter into a contract is that the contract must be lawful. In effect, the regulations render the contract to be unenforceable as this is expressly prohibited.

This outcome is irrational. However, until the regulations are amended to rectify this anomaly, we recommend that consignees and consignors comply with Regulation 330A as far as possible.

Any person who contravenes the Act will be guilty of an offence and, upon conviction, will be liable to a fine or to imprisonment for a period not exceeding one year.

Road hauliers, consignors, and their brokers and underwriters must now have written agreements in place. This means that they will have to have proper bespoke agreements or standard trading business terms, and properly presented waybills and road manifests.

Brokers advising clients and insurers are going to have to peruse the insurance provisions set out in Regulation 330D and decide what products to offer. In our view, Regulation 330D is too vague to be enforceable. However, Regulation 330D is an indication of government’s intention to create a system of compulsory insurance on the transportation of goods by road. We recommend that brokers advise their clients to ensure that they have GIT and carrier’s liability cover at the very least. This culture of compliance will no doubt assist when Regulation 330D is amended in the future.

Current agreements and standard trading terms will need to be revised in order to take into account the effects of the new regulations.

In summary, the consignor is obliged to: • obtain from the operator a written submission as to the payload of the vehicle and the distribution of the load on the vehicle • have in place a method of determining the mass of a vehicle and any axle or axle unit of such vehicle • keep a record of the mass of every load transported from his or her premises.

The consignee is prohibited from: • accepting goods if the vehicle is not loaded and transported in accordance with the Act • entering into a contract with the operator to transport the goods if the vehicle is overloaded (Regulation 330A(4)).

TWA | May/June 2015

39

Air cargo

Air freight soars Air freight growth, measured in freight tonne kilometers, was up 11.7% in February, compared to February 2014, while capacity grew 7.4%.

A

ir freight growth, measured in freight tonne kilometers, was up 11.7% in February, compared to February 2014, while capacity grew 7.4%. Much of the result is due to the timing of Lunar New Year activities. Air freight was given a strong boost in the weeks leading up to the 19 February holiday, which last year fell in January. In addition, air freight volumes were enhanced by the consequences of congestion at US West Coast ports. These factors showed up most in the Asia-Pacific results, with carriers in that region recording a rise in volumes of 20.8% year-on-year. Japanese carriers, in

trade is enjoying a positive growth spurt, but emerging Asian and Chinese trade activity appears to be easing slightly.

Capacity grew 12.7%. European airlines reported a 1.1% rise in FTKs. The European economy remains in the doldrums, and the effects of the Russian sanctions, and the region’s recession, continue to dampen demand.

There is some sign of improvement in manufacturing output, which could lead to stronger air cargo growth in the months to come. Capacity grew 2.4%. North American carriers grew 8.7% year-on-year. The region’s airlines also benefited from the congestion at US West Coast ports.

The fundamentals of the US economy show employment, consumer and business confidence all improving, which should underpin volume growth even after the ports issue is resolved. Capacity grew 0.7%. Middle Eastern carriers’ FTKs expanded by 17.6%.

The region continues to benefit from its strong geographic base, and has further gained by expanding its networks and encouraging freight to transit through its hubs. Capacity grew 19.2%. Latin American airlines’ air freight volumes sharply declined by 9.6% in February. Although regional trade activity has increased in recent months, this has not offset the struggles of the Brazilian and Argentinian economies. Capacity grew 1.9%. African airlines reported 8.3% growth in FTKs in February. In Africa, the regional trade growth has counterbalanced the weakness in the Nigerian and South African economies. Capacity grew 3.8%. “The prospect of strengthening air freight growth in 2015 gives an added incentive to the air cargo industry to invest in new procedures and facilities. At the World Cargo Symposium in Shanghai, held in March, the discussions centred on improving the customer experience. Shippers are demanding better and more specialised services. The industry is responding with initiatives including accelerating the implementation of paperless processes, benchmarking cold-chain facilities, and tackling the challenge of illegal lithium battery shipments,” concludes Tyler.

“Shippers are demanding better and more specialised services.”

Tony Tyler, director general and CEO, IATA

particular, benefited from the modal shift owing to congested sea ports in the US. “A combination of factors made February the strongest month in a very long time for air freight,” explains Tony Tyler, IATA’s director general and CEO. “Nobody expects growth to continue at this pace. As we look forward, however, there is room for optimism. Business confidence improved slightly and trade continues to grow.

The year is shaping up in line with a growth expectation of 4% to 5%”. AsiaPacific carriers saw FTKs grow 20.8% responding to strong demand ahead of the Lunar New Year. There is also evidence that significant automotive exports from Japan to the US shifted from sea to air. In general, Japanese

Index to advertisers Africa Rail 2015

33

Diesel Parts of America

25

Afric Oil

23

FAW Trucks SA

10

Barloworld Transport /Mainline

27

Imperial Logistics

OFC

IBC

Mercedes-Benz SA

IFC

Caltex Delo

40

CompuClearing 28

MiX Telematics

Digicell 20

Scania South Africa

Digicore OBC

Sapics 22

TWA | May/June 2015

5 14

Shell Commercial Fleet

3

Sunstone Logistic Systems

32

Trans Nova

30

UD Trucks Southern Africa

12

Volvo South Africa

9

Delo/5486/TRANSWORLD

Delo Testimonial: Freestate Petroleum Distributors ®

Achieves 1,000,000+ kilometres in a Freightliner Truck using Delo family of products. ®

®

Freestate Petroleum Transportation has been hauling petroleum products for over 20 years in the South African market and has grown to over 40 trucks in their fleet. They operate under severe conditions in the South African market with Freightliner trucks and Cummins ISX 500 engines burning 500ppm low sulphur diesel fuel under heavy loads of 56,000kg. They recently achieved 1,000,000+ km of total mileage in one of their trucks and wanted to see how the Delo® family of products protected the engine since its first use over 8 years ago.

Chevron and Freestate Petroleum personnel agreed to conduct an engine teardown and inspection of the Cummins ISX 500 engine in Bloemfontein, South Africa at the local OE Dealer. The engine burns diesel with sulphur content up to 500 parts per million and uses Caltex Delo® 400 Multigrade SAE 15W-40 and Delo® XLC Extended Life Coolant.

“We’re very excited about the performance of this truck. It was the first truck in our fleet that we acquired about 8 years back and it’s done about a million km and on the performance of this truck we acquired additional trucks. All our trucks run on Delo® 400 and their family of products,” says Jean Snyman, owner of Freestate Petroleum Distributors.

Connecting Rod Bearings

Very good shape showing minimal overlay removal and no copper underlay showing.

The final inspection overall showed a clean engine with minimal deposits and wear on the key engine components. The pistons showed minimal deposit buildup on the crown and top ring land zone. The camshaft lobes showed excellent wear protection and no visible wear scars on rollers or rocker arms. Bearings also were in very good shape with only small amounts of overlay removal – excellent for an engine with this many kilometres at high load.

“It’s hard to believe that this has been a vehicle that has gone over a million km with loads up to 56,000kg. There is minimal removal of overlay and just a couple of scratches where debris has gotten into the oil. This is reflective of the performance of Delo® 400,” says John Green – Chevron Technical Specialist.

Delo® XLC Extended Life Coolant also helps protect the engine cooling system on this truck.

Inspection of the cooling system revealed that Delo® XLC prevented cavitation pitting on the liners and water pump impeller. The engine cooling system showed no signs of deposit buildup or corrosion on key metal parts.

“We’ve seen the condition of the million km engine only running on Delo® 400 and Delo® XLC Extended Life Coolant. The way they protected the engine, it would be hard not to recommend these products to any other customer,” says Johan Liebenberg, Sales Manager OE Dealer.

To learn how Delo’s family of products can help you go further, visit CaltexDelo.com.

www.fishgate.co.za_CT_5703

Know your fleet better with powerful analytics.

Identifying inefficiencies in your fleet is next to impossible without a proper fleet management solution to collect, report and analyse your fleet data. Introducing Ctrack’s fleet analytics services – powerful business intelligence supported with high quality graphics and experienced fleet consultancy.

Let Ctrack help you shape your data for insightful decisionmaking to save cost and increase fleet efficiencies.

Always Visible

012 450 2222 • sales@ctrack.co.za • www.ctrack.co.za

Superior Vehicle Tracking | Stolen Vehicle Response | Insurance Telematics | Fleet Management Solutions