Logistics News July 2014 by Dalan

Logistics News July 2014

the independent voice of the

Supply Chain

industry

Freight forwarding

ALSO:

B2B • Global account management • Freight logistics• Facilities location • Training weapons

July 2014

CONTENTS

Building Business-To-Business supply chain networks Business-To-Business (B2B) network solutions are now in their second decade of maturity. Yet, it is estimated that only 7% of flows move through B2B networks. They are maturing and should be considered as a part of a supply chain IT architecture.

B2B

Out of the cloud and into today’s reality

BUILDING BUSINESS-TO-BUSINESS … supply chain networks

Freight logistics

Despite all the business hype, the African freight logistics industry is looking very much the same as it was 15 years ago – why is that so?

OUT OF THE CLOUD … and into today’s reality

Process management

6 THE PARADOX OF SC … iglobal account management

Training

Facilities placement

10 LOCATION, LOCATION …and location

The paradox of global account management in supply chains

Logistics

Can a process driven approach address service inadequacies and lost sales?

CUSTOMISE WEAPONS FOR … winning the competitive war

BPL’s SOLUTIONS DIFFERENTIATE … with flexibility

Outsourcing 14

RETHINKING 3PL … transportation

Telematics

COVER STORY Resolve is a unique new company in the South African and wider African markets. Born out of a consolidation of several companies in the Imperial Logistics stable, the business combines specialised expertise with proven experience and enablers to provide services and technology solutions across different industry sectors. Resolve strives to ‘make business better’.

CTRACK: STRATEGIC LEADER … of fleet management tools

SC strategy 20

RESOLVE … making business better

Regulars

18 BOOKMARK 21 NEWS 31 FORTHCOMING EVENTS 32 INDUSTRY ASSOCIATIONS & EDITORIAL DIRECTORIES

• B2B

Today, supply chains are networked. They are not linear. Instead, there are interdependencies with outsourced contract manufacturing companies, third-party logistics providers (3PLs), freight forwarders, and transportation providers. While corporate relationships are outsourced, information technology systems are not. Companies have automated the enterprise; but the automation of the extended value chain remains an opportunity. It is now possible. Today, most of the networks depend on ad hoc, manual processes. Despite a decade of technology evolution on B2B connectivity, the majority of the flows in the extended network move through spreadsheets, email and Electronic Data Interchange (EDI). As a result, as things change in the network, it is hard for trading partners to keep the information synchronised. It may be integrated, but it is not synchronised. Why? There is no network system of record. The flows are point-to-point. Data latency is high. As a result, when the data is received, it is often out-of-sync and out-ofdate. The links are fragile. As a result, multi-party process automation is not possible. Most companies know the problem, but they are confused on where to start solving it. They lack clarity on three basic questions: • Why a B2B supply chain business network solution versus EDI? • Why a B2B supply chain business network solution versus Enterprise Resource Planning (ERP)? • Which B2B supply chain business network solution to use? B2B and SC visibility Often the quest to build supply chain visibility in the extended network will drive companies to consider B2B supply chain business network solutions. When the suggestion “We need supply chain visibility” is raised, all heads in the room will nod “Yes”. It is something that everyone can agree that they need: however, defining it is a different story. The term ‘supply chain visibility’ lacks a common definition in the market with many technology providers offering some flavour of a solution. The pure-play supply chain visibility market has been problematic. The term ‘supply chain visibility’ goes through cycles, and has been overhyped by a series of new Best-of-Breed (BoB) solution launches.

July 2014 • Logistics News

Historically, the market has been boom and then bust. Companies fold due to the lack of technology to support the vision. Now, the technology is closer to delivering on the promise and dream of the supply chain leader. The many versions of ‘supply chain visibility’ solutions cloud the market. However, it should not stop the promise of B2B business networks for supply chains. Today the average company operates in a heterogeneous technology environment. They have a need for visibility across instances of ERP. There is also a need to have visibility across multiple systems to synchronise manufacturing and procurement. In addition, there is a need for inter-enterprise visibility or supply chain synchronisation across trading partners. This need comes in many forms. It includes visibility across multiple tiers of suppliers, logistics providers and contract manufacturers. It can be one-to-many or manyto-many. The average company today has greater visibility within the enterprise than outside the enterprise. Supply chain visibility is one of the clear value propositions of B2B supply chain business networks. It is a core and foundational element, but the solutions provide much more, including collaborative analytics and processes. The time is now to adopt B2B business networks for supply chain visibility. Why? The solutions are maturing and supply chain leaders have given up on getting supply chain visibility from ERP providers. Many companies are deploying multi-year ERP initiatives. The cost is large. As a result, the IT team is strapped for money and resources to help the supply chain leader move forward on B2B solutions. IT budgets are being cut, and the focus is on maintaining existing systems and finishing-up the ERP deployment. The IT team in many cases has little knowledge of B2B solutions and while they would like to help the supply chain leader, their hands are tied. As a result, the supply chain leader must make the business case to deploy the solution, often without IT support, at a time when all budgets are tightening. The first question that the supply chain leader is asked when looking for funding for a B2B solution is “Why not get it from the ERP provider?” The awareness of alternatives at the executive level is low, and many companies feel that continued investment in ERP will be the answer in the long-term to build a business network. In addition, the awareness of B2B supply chain business networks is also low in the system integrator community. These firms have made their money over the past decade on the implementation of ERP solutions. These deployments have been long and deployed many resources. Now that there are fewer ERP deployments, the market is more competitive with more consultants fighting for a smaller piece of the ERP deployment market. They have not shifted focus to understand the greater world of B2B supply chain visibility solutions. Yet, they have strategic relationships with many companies. As a result, there is a greater onus on education from the supply chain leader

in the company to help executive teams understand the changing landscape. So, what should companies do? There is much confusion. The supply chain leader needs to forge a direction, and needs to help the company understand when to source from ERP, when to use an EDI VAN and how to use B2B supply chain business network solutions. The biggest driver for the adoption of B2B networks is the change in the clock-speed of supply chain information. While weekly information was sufficient in the 1990s, and daily data was adequate in the last decade, now there is a need for continual refreshes of daily data on an hourly basis to synchronise trading partner flows. ERP and EDI connectivity are not sufficient. Yet, the average network is held together by spreadsheets and EDI messages. Solutions The solutions can be hosted or made available through Software as a Service (SAAS) models. The evolution of today’s cloud computing and non-relational database architectures enables new capabilities that were not possible a decade ago. One-to-Many: In a one-to-many model, companies are deploying private trading networks or hubs for themselves and their trading partners. These solutions centre on a dominant trading partner with a focus on their interactions. The best known one-to-many trading network is Retail Link where Walmart is trading and sharing information with their suppliers. Many-to-Many: In a many-to-many network, the solutions are intertwined and connected with many trading partners sharing information with many entities. These network solutions are more complex and offer more potential value. What it is not: It is not an EDI VAN. It is not a private network; it is not an enterprise system. Instead, it is a series of complex flows between trading partner nodes. Most current supply chain deployments are enterprise systems with a one-to-one data model. Enterprise data models built on one-to-one deployments are not transferable to B2B networks. Instead, the solution needs to be built with the network and with a many-to-many architecture in mind. Recommendations To move forward, supply chain leaders need to task themselves with five actions: • Clearly define supply chain visibility • Make the case for supply chain synchronisation • Stabilise ERP • Educate the organisation on the use of B2B networks • Partner with the B2B provider that makes the most sense. Now that the supply chain is outsourced, what is needed to provide the IT infrastructure to support it? What was not possible a decade ago is now possible. However, to take advantage, companies need to realign their thinking. • July 2014 • Logistics News

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freight logistics •

Out of the cloud and into today’s reality Despite all the business hype, the African freight logistics industry is looking very much the same as it was 15 years ago – why is that so? By Doug Hunter, doug.hunter@mweb.co.za

Over the past 15 years ‘radical changes’ have taken place in the African logistics freight industry, yes, but where is the radical change in results? Officials who rejoice at 2,213% growth while inflation is rampant above 6% should be fired on the spot for inadequacy and replaced with people of action and a results focus. Europe’s 2% growth is called recession. Would you be happy if your company was 2% more productive each year while your money shrank 6%? One result would be that your vanishing pension in rand value would be worth less than it was 10 years ago. So as logisticians how do we fix our challenges? We should get our heads out the clouds and focus on results through: • Public and private working together – it started with Transnet (TFR) and private LSP terminal collaboration to move bulk off the roads and onto rail. Which was a good start. • New facilities investment – at last South Africa is sourcing locomotives and rolling stock albeit via the ‘China Syndrome’. And soon Gauteng inland port Tambo Springs – but why clear customs at the sea port first? Stop the draft Customs Bills dialogue, get public and private together including the associations, give them five days to reach consensus then draw up the final Bill to fit the needs. The Kenyans did that with Embakazi (Nairobi) decades ago. Why is SA dragging its heels?

• I ncreasing throughput – Durban and other SA ports have doubled container throughput, corridors are rightly receiving focused attention. But now rail capacity for the bulk commodity corridors is strangling our economy. We need to increase capacity, so work out how and do what it needs. While we talk, Australia is taking our business. • Inter-Africa trade – SA needs to work to regain its position as the ‘Gateway to Africa’ – and any delay will make us the backdoor. What about: - Borders cohesion – automate the paperwork; rank the good guys, have a fast queue only for the consistently planned, organised and certified, with no tolerance on corrupt officials and companies; if caught, you start from the slow lane again - Rapid Africa Internal Links (RAIL) – for freight not people; one train country-to-county; once on, only cleared at route-end not intermediate countries - Rail gauge – for new corridors think new gauge to incorporate more effective logistics technologies like double stack, drive on, swap body and other options. • Planning execution and visibility – think end-toend Shanghai to Johannesburg supply chain and not just one terminal changeover efficiency. ‘Next week’s business’ reactive rail planning takes too long, and is not really planning at all. SA needs visibility and feedback, a mix of standard loads, forecasts and equipment, good ICT and skilled planners to move goods from the current 70% tonne/kilometre of freight from road to rail. • Shortage of logistics skills – there is a constant bleat about the shortage of logistics skills but there are many who could help, some perhaps with ‘unpopular’ credentials. Use local African skill of any flavour – local is lekker because we all spend locally. My Africa, the one you, I and the world see as the future, needs a few common business culture objectives to get intercountry logistics effective to boost SA and inter-Africa trade increasing local general wealth – not the wealth of generals. If you want challenge, come and work in Africa, we have plenty! • July 2014 • Logistics News

• process management

The paradox of global account management in supply chains Can a process driven approach address service inadequacies and lost sales? By John van Wyk, Value Chain Partners, and Jan Gillett, Process Management International

Imagine an offshore platform operating off the coast of Africa, 24-hour shifts with little margin for error. A component failure occurs in the engine driving the power generator. Standby power takes over in a matter of seconds and operations continue without disruption. The broken component sets in motion events that connect teams of people crossing several international borders. An engineer assesses the problem alerting the local supplier onshore as to the likely parts list. Supplier commits to a speedy reply. Within an hour the call comes in to say parts aren’t available for that specific model in the country and there is a lead time of one to five weeks for delivery. To varying degrees this takes place daily in oil and gas applications, mining and production environments around the world. Typically operations are internationally owned, one of many globally. Procurement and category management are established as a strategy for some years with stringent bidding processes to select suppliers. Consolidated spend with preferred manufacturers has produced cost savings on purchases and committed levels of customer service. Bidders have honed their proposals citing features and benefits of their products, extensive international network, annual investment in training and quality certifications, even how their business is designed to support the customer at critical moments. However, follow-through development of robust systems for in-service problem prevention, and rapid response to breakdowns is usually a poor relation compared to securing the order. In this example who carries the responsibility? The

July 2014 • Logistics News

dealer, for not managing and forecasting stock based on mean-time-to-failure-rates or other inventory models? Or the manufacturer who negotiated centrally, passing the after-sales responsibility to the dealer? Or the platform operator who negotiated so well that all risk for uptime lies with the service provider? It isn’t about blame but rather an opportunity to look critically at these deals and consider whether traditional assumptions about sales process and accountability work. Does the current process break down because accountability is shared or unallocated? Do teams of specialists connected through common employment naturally form cohesive operating units? Can management hierarchies confuse and delay service delivery at the coal face? Managing customers Managing global accounts isn’t simple. Supply-side responses are to offer an integrated experience irrespective of location or distribution model. Delivering this proposition creates myriad opportunities to underperform to specification. One stock failure as per the example could have involved many individuals before the problem was resolved. How distant is this scenario from the initial bid offered by the supplier and how could performance be optimised? Perhaps the paradox emerges when processes are deemed to be sufficiently generic to apply universally, where historical behaviour exclusively becomes the defining predictor of future behaviour. Perhaps a global perspective of capability and skill is assumed as a result of ways of working ‘because that’s what we do in market A’, failing

to acknowledge local conditions sufficiently. The offshore platform remains short of an engine component, no amount of blamestorming gets the part to the workshop any faster. Non-performance locally is remembered and could lead to exclusion or lost margin to win back or keep the business. Impacts include lost revenues and management time. The more global and more senior the engagement team, the more cluttered the hierarchy. This ‘curse of hierarchy’ creates work that is more about boss-pleasing than solving the customer’s problem.

Enter LAA Enviro Awards 2014

Systems and processes need to matter Contextually a system is “a network of interdependent components that collaborate in order to achieve the aim”*. Leadership must seek to optimise the system – to ensure that all processes are effective, efficient and adaptable, working toward common aim. For many, this is a revolutionary concept. Large customers report that the upfront sales engagement is usually the strongest aspect of the customer experience, unsurprising as it is a simple system. After-sales engagements are problematic however, and complaints include: • poor care and attention to detail and individual accountability • lack of fundamental service capability • management of key accounts operating in local market • abdication to manufacturer for any problems. Ties that bind the delivery of the products and services to what was originally offered become tenuous over time and transactional focus leads to internal-only views of the world. Observations of process thinking in automotive supply chains show what can be achieved when combining focus and perspective. Supplier relationship management and its intrinsic measurement of mutual performance suggests that companies can improve value through applying process thinking. Busting myths Does this apply similarly in other industrial supply chains? Often sales, as customer facing teams, are considered necessary evils rather than part of value-delivery. Can replacement parts for engines on an offshore platform be shipped from stores within hours of being identified? Yes, within a process that keeps the enterprise’s purpose centred to customers, aligning cross-functional work teams to anticipate and manage customer engagement over the life of contract. Breaching traditional boundaries that grow between sales and service teams, eliminating grey areas between dealer and manufacturer responsibilities. Links between process resilience in serving customers and commercial benefit can become visible by applying a rigorous, comprehensive approach to implementing equipment supply and service contracts. By connecting the organisation the absence or presence of value will be plain to see. • * Acknowledgement: Dr W Edwards Deming, 1992

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July 2014 • Logistics News

• training

Customise weapons for winning the competitive war Off-the-shelf training courses are useful for imparting competencies that are needed by all businesses; competitiveness comes from being able to do things differently by applying unique skills. This article explores the magic needed to build those competitive weapons. By Charles Dey, www.charlesdey.blogspot.com

How do we develop training tools for winning the competitive war? Much of our organisation’s current intellectual capital exists in the heads of those who have been around for some time and have gained their expertise through time spent at the coalface. On the other hand we are fully aware that today’s ways of doing things will not keep us competitive in the future – we need to be bringing new knowledge, skills and attitudes into our organisations. To do this we need to track the changes in our environment and to conduct research on how these changes should be addressed: extensive sources of information, networking, and the Internet are the main avenues.’ Creating magic Finding the content required for a training course through these channels is only one element – what is key is the transformation of this information into something about which people are really excited to learn and, once taught, ensures that participants hit the ground running when it comes to motivation and application of this learning in the work environment. This requires the generation of creative synergies between two areas of expertise: • The subject matter expert, the person who knows, or has access to, what needs to be trained, and • The instructional designer who knows how to train any subject in the way best suited to the content, level of complexity and target audience. This combination very rarely exists in one individual: subject matter experts are those who, as a result of their experiences, can be expected to be older and more process oriented. By contrast, instructional designers are creatively driven – training technology is evolving more rapidly than most others. World class training

July 2014 • Logistics News

products are no longer simply a set of course notes and some PowerPoints – they may include audio, video, games, work-based assignments, collaborative exercises and many more. These need to be combined so that, by the end of each training intervention, measurable business objectives have been met. We may fondly remember the ‘good old days’ when we were allowed to leave our offices and attend a five- to 10-day course. Now we’re lucky if we have time for a lunch-and-learn. Yet we’re expected to learn more with less while achieving a greater effect on true performance. The objective is to fully engage participants as much learning is concentrated into as short a time as possible. It is for these reasons that the welding together of subject matter experts with an instructional designer is so essential. Putting the cart before the horse What are the measurable business results that need to be achieved from the training intervention? The answer to this question must be agreed between subject matter experts and instructional designer before any course design can start. In other words, we start with the end in mind and work backwards: the end, the reason for investing resources in the learning programme, is typically to solve a business need and to help an organisation accomplish a goal. These results are not just an afterthought, they are the whole point. We therefore must spend time upfront to reach agreement with business leaders about the role training can play in achieving the goal, the expected impact or other measures of success. A last word: research has shown that if, in our efforts to change behaviours, 90% of the effort is in the delivery of training, then 70% of the people will try new skills and fail. However, if 50% of the effort is in the delivery, and 50% is in follow-up activities, then 85% of the people will consistently apply what they learnt. •

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• facilities placement

Location, location, location So with World Cup fever behind us, I thought it would be interesting to put a different spin on the whole affair. By Rick de Klerk

As you no doubt have read, there was significant criticism of the Brazilian World Cup 2014’s escalating costs for both hosting the event and its extravagant stadiums: one of which has been built in Brazil’s sixth richest city Manaus, home to a large population of poverty-stricken citizens living on the edge of (and sometimes in) the Black River’s banks. South Africa’s stadiums have fared no better, with a recent report on News24 stating that of the 10 World Cup 2010 stadiums built or renovated – at a cost of R11,5-billion in total, nearly a quarter of the event’s budget – nine are in the red, with the municipalities picking up the bill. Only Soccer City in Johannesburg is making ends meet. While there are a variety of reasons why countries continue to score own goals when it comes to their financial investment in the event in relation to their actual return (much to Sepp Blatter’s continued delight), one of the key issues is the conceit that these stadiums will somehow create employment and an increased influx of revenue from sporting events now that there’s a ‘decent’ place to hold them. If I were to suggest to a transporter or manufacturer that they were to build a depot or factory in an area with the aim of creating demand in a populace where said demand doesn’t exist, I know exactly what they’d say to me. There’s a technical term for this kind of reasoning: Ballocks (sic).

Educandos, the river neighbourhood in Manaus. (original source: http://www.pedromartinelli.com.br/blog/ educacao-ou-amido-de-milho/)

July 2014 • Logistics News

It’s particularly telling when FIFA’s own recommendations regarding pre-construction considerations for a stadium and its placement take up three pages of their ‘Football Stadiums – Technical recommendations and requirements’ document*, while five pages are dedicated to the care of the playing field and the differences between natural versus artificial fields. Facilities placement Depot and warehouse placement is the result of extensive analysis of the surrounding client base, both those being serviced by your facilities further afield, and the potential customer base for your products based on existing businesses that could benefit from your product in that area. But, more importantly, the net result needs to be positive on both sides – a reduction in transport costs, hired vehicles or penalties for late deliveries that offset the cost of the depot. I’ve written before that logistics can sometimes hide uncomfortable facts about where goods and services come from, but in one aspect, it continues to be bluntly truthful, and that’s in the optimisation of delivery. No-one is going to build a warehouse because of the supposed ‘goodwill and solidarity’ it may generate amongst your customers. A depot won’t create a need where the need isn’t feasible or wanted. Indeed, facility placement is considered one of the hardest operational puzzles to solve – while we can verify if the placement would create savings, we have no way of knowing whether how we determined the location is the most efficient way of doing so. Any facility placement is, therefore, a long-term strategic decision for transporters, manufacturers and the like, and is treated with the respect it deserves. That FIFA continues to operate in such a reckless fashion within third-world economies – particularly when the costs for building, renovating and maintaining these stadiums are so high – should be abhorrent to any logistics practitioner. That third-world countries acquiesce and promise long-term gains, despite extensive research that proves the World Cup delivers anything but, is the real tragedy. • If you wish to add comment, email rick.de.klerk@opsi. co.za * ‘Football Stadiums – Technical recommendations and requirements’, 2007, FIFA, http://www.fifa.com/mm/document/tournament/ competition/football_stadiums_technical_recommendations_and_ requirements_en_8211.pdf •

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• logistics

BPL’s solutions differentiate with flexibility Bidvest Panalpina Logistics is in the business of flexible supply chain solutions, says warehousing director, Stephen Smith. “We can tailor-make solutions according to clients’ needs across the full logistics spectrum. For warehousing this includes both single and multi-user solutions.”

BPL operates from 25 warehouses located throughout South Africa, which are compliant with SHERQ and other applicable legislation, including CAIA and ISO 9001 certification. “In East London we have a 1 000 m2 hazardous warehouse, specifically designed for the storage of flammable and hazardous chemicals. Our warehouses in other regions are also chemically compliant. “Our global clients demand that we meet international warehousing compliance standards, which are high. The SA market has challenges when it comes to meeting these standards, but we make every effort to satisfy our clients’ requirements,” says Smith. BPL’s warehouse management system provides full integration with clients’ systems to give them visibility of their stock at all times. Many value added services are available, such as container packing and unpacking, labeling of products, temperature controlled storage, bonded storage, flammable goods storage, hazardous goods storage and high value cargo management. Explains Smith, “Our new technology enables order management, stock management and generation of accurate management reporting, which are critical to efficient management of any business.” BPL’s transport division has an extensive network of owned vehicles and dedicated third party contractors supported by logistics experts who organise and manage the physical cargo flow and utilisation of assets. The company’s range of transport services is extensive

July 2014 • Logistics News

and includes general cargo, FMCG, break-bulk, liquid bulk, dry bulk tankers, refrigeration transport and more. Operating 24/7, its advanced distribution and product tracking capabilities are processed via a hi-tech management system, ensuring products reach their destinations safely and efficiently. BPL has a number of transport accreditations and is a signatory of Responsible Care (CAIA). The key elements of its success are the exceptionally high standard of drivers and an uncompromising commitment to safety, training and wellness. As a Bidvest-owned company and with global partner Panalpina, BPL delivers tailor-made integrated supply chain solutions in ocean and air freight, clearing and forwarding, transport, warehousing, container storage, or any other logistics requirement. “Cross-docking in port facilities (Durban, Cape Town, Port Elizabeth and East London) has proven to be a cost saving solution for many of our clients. For example, a container will be unpacked at our facility in the port area and the product sent by truck load to various inland destinations,” explains Smith. Container handling equipment in KwaZulu-Natal includes two Kalmar machines that can stack both 20 foot and 40 foot containers. “Our 24 hour operating facility in Durban has capacity to store up to 700 containers, enabling BPL to execute staged deliveries,” says Smith. “All these differentiators are important in attracting a loyal client base,” he concludes. •

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• outsourcing

Rethinking 3PL transportation The traditional view of the outsourcing of supposedly ‘non-core’ business functions like transportation has changed completely in recent years. As supply chains have transformed into an information-enabled network of global business relationships that place flexibility and responsiveness at the heart of a new way of doing business, so the provision of thirdparty logistics services has been revolutionised.

The traditional view of 3PL service providers has been that they offer commodity services that are not core to the business of their customers, such as transportation and warehousing. In a modern business environment in which supply chain networks are global, collaborative and linked by information technology, the provision of 3PL services is changing. South Africa’s 3PL landscape is dominated by road freight providers, and by the Gauteng economy. South Africa differs from many countries in that its industrial heart is not on its coastlines, but concentrated in the inland province of Gauteng. Combined with the fact that the South African economy remains highly dependent on exports, this has impacted on the way in which the transport network has developed. The country’s road, rail and air networks tend to spoke outwards from Gauteng (with Johannesburg at the centre) towards the coastal ports. While we have the lion’s share of Africa’s transport infrastructure, historical imbalances in their development have resulted in the dominance of road freight transport, where we have over 15% of sub-Saharan roads, and some 82% of sub-Saharan motorways. While the 3PL industry has grown as a result, so have the inefficiencies deriving from a road-freight based transport economy. This places additional pressure on 3PLs to demonstrate the value of outsourcing to their clients. The 3PL sector experiences increased competition from global players, stagnant domestic economic growth, labour unrest and geopolitical change. Likewise, manufacturers and retailers are faced with declining consumer demand, spiralling food and petrol prices, and above-inflation price increases on basic services such as electricity and water. To continue to be viable and competitive, 3PLs often have to drop rates and margins in order to secure new contracts, ultimately an unsustainable business approach. While this arms-length approach to the outsourcing of the transport function is not optimal, the benefits of the strategy remain. Transport logistics is not a core competence for most businesses, and outsourcing the transportation management process means not having to purchase or maintain a fleet, and not

July 2014 • Logistics News

having those assets on the balance sheet. More than this, a strategic approach to outsourcing means partnering with a provider that will make informed investments in processes and technology on the customer’s behalf. In particular, a collaborative Transportation Management System (TMS) technology approach can enable customers and 3PLs to optimise the transport function in the holistic context of the end-to-end supply chain, not only in terms of the freight that the 3PL handles. In this TMS approach, 3PLs can demonstrate greater efficiency in managing transport through having greater supply chain visibility, but the customer also feels they have greater control over an outsourced process since they share information on lead times, routing, rates, driver performance and other concerns. Similarly, a more collaborative approach between the customer and the 3PL can reduce the impact of fuel costs and increase carbon reduction in the transport function. New PerformanceBased Standards (PBS) vehicles can greatly improve fuel consumption and congestion, and improve road safety. Demo projects have shown above-average improvements in fuel efficiencies, along with a drastic reduction in road wear and larger payloads which result in fewer trips. Ultimately, both 3PL and the customer need to collaborate to avoid the trap of a transportation outsourcing arrangement based on rates and squeezed margins. In a tight market, technology and process collaboration provides the only means to a win-win solution. •

For more information contact Ray Singh, ray.singh@unitrans.co.za, or visit www.unitrans.co.za

By Ray Singh, managing director, Customer Solution Development, Unitrans Supply Chain Solutions

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Ctrack: strategic leader of fleet management tools Ctrack, one of South Africa’s leading suppliers of telematics fleet management tools, has positioned itself as a strategic partner for growth at the inaugural TruckX Conference and Fleet Awards, taking place on 19 August at The Maslow in Sandton. Boasting nearly three decades of experience in telematics solutions for the private and commercial vehicle sector, Ctrack remains on track to become one of South Africa’s leading suppliers of fleet management tools, both software and hardware, to the freight handling and logistics sector. “There’s no doubt that the SA logistics sector is under pressure, especially as commodity prices continue to rise and labour related matters continue to abate growth within the sector,” Hein Jordt, Ctrack’s managing director said. He explained how Ctrack is able to offer transporters necessary tools for them to grow their operations, by placing a strategic emphasis on smarter fleet management and by providing the necessary training to effectively improve the bottom lines of any transport business. “In the transport business, timing is critical and making sure your trucks are where they are supposed to be, every moment of the day, is key to maximising productivity,” Jordt added. Ctrack has been named as headline sponsor of the Truck X event – its spokesmen reiterating the importance of enhancing perceptions within the automotive and logistics sector. This year’s awards categories include: Truck of the Year; Best Heavy Commercial Manufacturer; Best Medium Commercial Manufacturer; Best Light Commercial Manufacturer; Best Fleet Car Manufacturer; Best After Sales Service; Best Trailer Manufacturer; Best Courier Company; Best Third Party Logistics Provider; Best In-House Logistics Provider; Best Tyre Brand; Best Fuel / Lubricant Brand; Best Insurer; Best Truck Stop; and Driver of the Year. Earlier this year the company also launched a national toll management solution that enables toll costs to be verified before being paid. This Ctrack solution allows fleet managers, operators and individuals to validate the integrity of all national toll transactions, supporting Gauteng e-tolls and the numerous stop-and-go toll plazas across SA. These checks and balances allow motorists and companies to confirm their actual toll liabilities. Jordt said that while the integrity of Gauteng’s e-toll system may remain under scrutiny from the public, it

remains important for any fleet to be on top of the number of toll gates or gantries they pass through on a daily basis. Moreover, it does not matter what vehicle types are being used in a business fleet as Ctrack’s solutions support all five vehicle classes recognised in SA. “It’s important to note that effective fleet management goes beyond just fitting the latest and perhaps the most high-end system one can afford, without having the proper operational skills to use the systems. On our side we maintain a strong focus on training and development for all our employees so that they may provide succinct feedback for customers at any given point in time,” Jordt added. He said a continual focus is being placed on training fleet managers on the use of the company’s tracking solutions to reduce down-time and increase profitability. “Our systems are able to fully integrate with certain trucks, which means we are able to provide customers with tracking info as well as critical information on the health and operational status of the truck. We know certain manufacturers are also offering similar solutions, but we’re able to offer a uniquely SA approach thanks to our understanding of the logistics sector and the trends that affect traffic congestion,” he added. Ctrack will be looking to further enhance its presence at dealerships in the coming months, in an effort to speak to transporters, operators and fleet managers directly at point of sale. While effective fleet management will always remain crucial in ensuring the ongoing success of any transport business, it remains crucial that stakeholders in the SA logistics sector partner with leading companies like Ctrack, which remains, arguably, the class leader when it comes to tracking, tracing and recovery. • July 2014 • Logistics News

• bookmark

Logistics network design This is one of a few titles I have reviewed in the field of humanitarian logistics. It is based on academic research done by the Kuehne Foundation but the findings are useful and implementable in practice.

Reviewed by: Gerard de Villiers gerard.devilliers@arup.com title: Logistics Network Design in Africa subtitle: Integrating Aid Flows and National Self Supply author: Martin Kessler publisher: Haupt Publisher edition: 2013 isbn: 978-3-258-07840-3 pages: 160-page softcover price: €36.90 at www.haupt.ch

July 2014 • Logistics News

A uthor

M artin K essler did the in sub-Saharan Africa and he uses the food distribution supply chain in Tanzania as a case study and background for the discussion of the theoretical concepts. Countries in Africa differ significantly in maturity in their supply chains, and features such as suitable infrastructure, political and economic stability, and selfsufficiency. But the proposed framework for network design is sufficiently general to allow application in most countries. The book identifies logistics and supply chain management as a central issue and key factor in the efficient supply and distribution of food and medicine in sub-Saharan Africa. It is aimed at students as well as decision-makers in aid agencies, logistics service providers and government organisations as an application-base guide for the design of networks in humanitarian logistics. The book is published as part of the Kuehne Foundation Book Series on logistics among other titles such as ‘Disaster Relief Logistics’, ‘Humanitarian Logistics’ and ‘Humanitarian Logistics in AsiaPacific’. Humanitarian logistics has become an important specialist discipline and although the theory and principles are similar to that of business logistics, the application and implementation differs significantly. Kessler starts the book after the introduction by exploring the essence of logistics in general and humanitarian logistics in particular. He explains the distinctions from business logistics since humanitarian logistics face different challenges in terms of goals, content and processes to those faced by the commercial world. Humanitarian logistics should be seen as part of social responsibility and Kessler divides it into chronic disasters and emergencies. The research

in Africa

former covers food insecurity, water shortages, lack of healthcare and housing while the latter includes natural disasters such as earthquakes and man-made disasters such as terrorist attacks, displacement of people and civil war. Specific distinctions between humanitarian and business logistics include the reality that the customer is not the start and end of the supply chain, but the supply chain starts with donors and ends with the beneficiaries. There is no development of demand (in the classic sense) but the needs are usually determined by the humanitarian organisations. The goals include reduction or prevention of starvation, malnutrition, illness and death as opposed to customer service in the business world. That humanitarian supply chains involve commercial partners, often leads to conflict between the monetary goal of the commercial sector and the non-monetary goals of the humanitarian sector. The development time lag of humanitarian logistics also differs from business logistics. Logistics projects in aid agencies are shortterm in nature and tend to assume more the character of fire fighter than strategic problem solver. Kessler spends some time in explaining the relevance and role of logistics in aid agencies and the importance of logistics for developing countries. He defines the specific needs of the research to include collaboration development work in chronic disasters, processes and procedures of aid agencies, politicians, academia as well as the logistics industry, the development status, needs and benefits of logistics technologies and the combination of national economic, business and engineering perspectives. The research was done in the food and healthcare supply chains in Africa and the author provides a very interesting comparison between

42 countries in Africa in terms of national food production, food imports and food aid. Similar analysis is done in the healthcare system although the focus here is on supply chain structures and logistics processes. Accessibility and mobility are regarded as key elements in the supply chains and specific attention is given to transport issues. Transport hubs such as seaports and inland terminals, transport corridors with focus on road, rail and intermodal transport as well as the last mile, receives attention. The next part of the study suggests a framework for logistics network design that starts with predesign assessment of the need, including internal and external influencing factors and prioritisation of target variables. The following step defines the network concept in terms of ‘make or buy’ decisions, procurement strategy, network structure and the logistics concept (decoupling point), followed by network planning that includes location, inventory, mode and even routing issues. The last part of the framework covers network operation and monitoring.

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Logistics projects in aid agencies are short-term in nature and tend to assume more the character of fire fighter than strategic problem solver. The final section in the book covers a case study in Tanzania where this framework is used and each of the respective steps defined in the framework are analysed and specific recommendations formulated for the design of an optimal logistics network. The author suggests a network of regional hubs in the main ports and hinterland nodes as well as the need for market hubs and village hubs to ensure both first and last miles are efficiently served. The conclusions confirm that the application of logistics principles to supply structures and processes in Africa is an effective means of improving the population’s access to important basic goods such as food and medicine. However, the main aim could not be, as in commercial logistics, to minimise costs according to economic principles. Non-economic factors such as appropriate collaboration need to be considered and the content, methodology and functionality of supply chains developed by industrialised nations needs to be modified in Africa. Having recently done logistics network development work for soybeans in Tanzania, I found the research valuable with much practical use and implementable suggestions. Not all our readers are interested or involved with humanitarian logistics but for those who are operating in this theatre, it is a useful book which I gladly recommend. The Kuehne Foundation is constantly working towards fostering professionalism in the humanitarian sector and their practical research adds much value and academic credibility.•

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July 2014 • Logistics News

• SC strategy

Resolve – making business better The global business landscape is more complex and demanding than ever. Most economies have been sluggish since the recession five years ago, and growth has slowed, even in the emerging market economies. Against this background, some businesses have continued to expand into global networks and evolve their supply chains. Customer demand, in particular, has proven to be more complex and varied as consumers and businesses require the flexible, customised and speedy provision of goods and services from all over the world. Success in the current climate requires businesses that understand the competitive advantages that assets, technologies, people, processes and alignment with the rest of their supply chain can provide in tight market conditions. Among the key success factors is the alignment of the business strategy with these areas and the ability to drive strategy through to operations. Into this business landscape comes Resolve, a unique new company in the market. Born out of a consolidation of several companies in the Imperial Logistics stable, the business combines specialised expertise with proven experience and enablers to provide services and technology solutions across different industry sectors. The origins of the company in Imperial Logistics and an ongoing relationship with the parent business, means that Resolve brings scalable and end-to-end services and solutions to its clients. Resolve currently has a staff complement of over 1 200 people headquartered in South Africa, and operating with a footprint across Africa. The business also has a number of international strategic partners, enabling it to combine global solutions and resources with local insight and expertise in its markets. Central to Resolve’s strategy is the commitment to making business better for its clients through aligning their business and supply chain strategy, and optimising their technology, people and business processes considering global best practices and local knowledge. It goes without saying that such a commitment requires a strongly collaborative partnership approach with its clients. The company offers a great deal more than the standard approach of consulting businesses, and is focused on four key value-added offerings: • Advisory – Resolve offers its clients innovative and practical advice on how to streamline and optimise their operations, bringing people, operations, processes and technology seamlessly together. Focus areas for this offering include supply chain optimisation, physical asset management and business processes and systems. • Technology – these solutions cover the design and implementation of enterprise applications, integrated planning and execution management, workflow and process automation as well as tailored software development and business intelligence. • P eople enablement – this offering ranges from organisational design, through critical change

July 2014 • Logistics News

management and instructional design and training. •P rocess outsourcing – covers critical operational capabilities, where Resolve offers deep industry expertise in areas such as procurement and inbound supply, storage and assembly, distribution management and asset lifecycle management. With the skilful deployment of expertise in these areas, across different industry sectors, Resolve is able to partner with clients on their improvement journey, and cover a broad spectrum of business activities including marketing and sales, operations, supply chain and asset management; incorporating technology, finance and human resources. The business brings many years of deep industry expertise in specific industries such as the automotive sector, consumer products, healthcare, industrials, mining, public services and infrastructure as well as financial services. As with any corporate business developing and growing in South Africa, a key growth area for Resolve is in emerging markets in the rest of Africa. Resolve’s expertise in Africa is a key element in enabling clients’ strategic growth plans across the continent. Resolve brings a unique mix of skills, strategy and operational expertise to the table. Coupled with its scalability and reach, these attributes will make the Resolve brand a prominent one in the business landscape in the near future, as it strives to make business better. •

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Information unlocks logistics control

Cargo transport in SA is an industry faced with a number of challenges. Companies in this sector have one overriding objective: move their cargo as fast as possible to where it is required. However, infrastructure problems make this a difficult task and often cargo transport companies are simply unable to move the cargo as fast as they are receiving it, causing backlogs, inefficiencies and a host of other challenges. Telematics solutions have become increasingly common as a way of mitigating this challenge, and to optimise and gain maximum control over logistics processes, access to integrated real-time information is critical â&#x20AC;&#x201C; which requires a platform to bring disparate telematics together. However, when trucks and trailers from different suppliers with different telematics systems are combined into a single convoy, valuable information may be lost, as manual reconciliation between the different systems is required. Often, different systems from various suppliers cannot work seamlessly together. To gain a full understanding of the entire cargo transport chain, integrating multiple systems into a portal that offers full end-to-end visibility is critical to efficiency. Silos need to be broken down using an integrated,

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cloud-based, vendor-neutral aggregation platform to bring together information from various telematics systems in real time. A standardised interface, with dynamic central data visualisation that is independent of vehicle manufacturer, telematics provider or stakeholder, will create visibility throughout the value chain. This enables all stakeholders to obtain the information they need to monitor and track cargo throughout the value chain, in real time.

July 2014 â&#x20AC;˘ Logistics News

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Hino prepares for Dakar

Hino, the leading Japanese truck manufacturer, has started its preparations for the 2015 Dakar Rally. The company is again teaming up with Team Sugawara to enter two, four-wheel drive Hino 500-Series trucks in the event that will take place in South America in January. Hino has by far the best reliability record of any participating manufacturer in this gruelling annual event, with 23 consecutive finishes since entering for the first time in 1991. South African Giniel de Villiers, who drives a Hilux for the Toyota Imperial Team in the Dakar, and who has been the highest placed driver of a Japanese vehicle for the past several years, was invited by the event organisers to attend the Japanese leg of their promotional tour for the 2015 event to encourage more Japanese participation in the event.

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Transnet sees major profit growth

T ransnet ’ s profit is up 24,9% for the 2013/2014 financial year to R5,2-billion, compared to R4,1-bn for the same period last year. The group’s annual revenue increased 12,8% to R56,6-bn, compared to R50,1-bn for the 2012/2013 year. Transnet chief executive, Brian Molefe, noted the growth was largely driven by volume growth in automotive and containers on rail of 25,2% as well as a 14,2% rise in minerals and chrome volumes. Container volume at ports increased by 6,3%. Rail’s overall volumes increased by a marginal 1,3%.

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Cut costs by improving punctuality Products received from suppliers are not always available exactly when retail channels need them. Items that arrive too early clog up warehouse space while latecomers often incur expediting costs and lost sales. By tailoring transportation methods and distribution centre processes to match the delivery speed required of each product, companies can reduce the cost of transportation, prevent excess inventory, and eliminate lost sales. Configuring supply chains in this way is often done through SKU segmentation, but this is difficult in complex operations where there are numerous products and an extremely diverse supplier base. Researchers at the MIT Center for Transportation & Logistics (MIT CTL) have developed a model that uses purchase order (PO) information to help retailers determine when many different types of products need to be shipped to meet sales deadlines. The researchers were able to identify PO attributes that can be used to predict with more than 90% accuracy how much time the retailer needs to ship a product from suppliers. In test simulations on-time performance was improved by 36% to 60%. Using this information, the retailer can cut transportation and holding costs, and potentially increase total sales volumes because more products will be available at the store when required. Also, the model can be updated automatically as new data comes in.

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Green transport supported Investing in ways to be more environmentally friendly differentiates transport providers in an increasingly crowded market. Image conscious retailers looking for a delivery partner are more likely to prefer Provider A, who shares their environmental values, than Provider B who has not yet taken steps to minimise environmental impact. This trend directly mirrors consumer behaviour. It’s inevitable then that this sentiment would follow through to the supply chain and a retailer’s transportation providers.

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Serco pony trailer delivers

Serco has developed a lightweight trailer ideal for use in urban areas, especially around commercial hubs and other environments where there are vehicle height and parking restrictions. The 6,9 m trailer has a 10-pallet footprint load area, a payload of 8 tonne, a low deck height of 350 mm with a body height of 2,9 m, greatly simplifying loading and offloading operations. Serco developed the vehicle – commonly known as a pony trailer – after receiving a request from client Coke Fortune, a distributor for Coca-Cola, who wanted something that was relatively low cost, highly versatile, durable and could be pulled by a small truck tractor. The truck tractor of choice was a rigid type Isuzu FRR500 converted and re-homologated to a truck tractor to cater for the pony and semi-trailer combination. This was a tough assignment given there are no blueprints and the specification required certain unique requirements to make it work.

Maersk and MSC to share vessels Maersk Line and Mediterranean Shipping Company (MSC) have entered into a 10-year Vessel Sharing Agreement (VSA) on the Asia-Europe, Transatlantic and Transpacific trades. The VSA replaces all existing VSAs and slot purchase agreements that Maersk Line has in these trades. The VSA will include 185 vessels with an estimated capacity of 2,1-million TEU, deployed on 21 strings.

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July 2014 • Logistics News

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Property forum puts experts in hot seat

Leading commercial and industrial property investment company, Improvon, will again be hosting its annual highly acclaimed Property Trends Forum on 15 October in Johannesburg. This will be the third consecutive year that Improvon has hosted the property trends forum, which focuses on the major challenges facing the commercial and industrial property sector. The sought-after event draws interest from the commercial and warehousing property sectors as it provides crucial insights that assist with the formulation of property strategies. Each year a highly respected and knowledgeable speaker panel is selected; individuals who are all specialists in their field of expertise, are able to predict the likely outcome of challenges currently facing the sector and can provide unique insight into the property market. This year’s panel will shortly be announced. In the past, topics discussed included the impact of interest rates and cost of finance; short, medium and long-term prospects of the SA economy; the impact of poor service delivery on the property sectors; and the impact of e-tolls. The make-up of the 2012 panel was equally impressive including as it did renowned scenario planner and author, Clem Sunter; property economist and Head of Property Studies at UCT, Professor Francois Viruly; then SAPOA president, Dr Sediso Moseneke; and Nedbank regional executive for Property Finance, Ken Reynolds.

Mars Africa selects Transnova

Transnova, a leading provider of transportation management system (TMS) applications and logistics services, has welcomed Mars Africa to its growing network of TMS clients. Mars Africa is a wholly owned division of Mars Incorporated supplying leading brands including Royco, OXO and Masterfoods. By leveraging the Transnova platform, Mars Africa will be able to automate daily transportation tasks (including planning, execution and settlement), optimise freight routing and gain critical visibility into order and shipment status. Additionally, Mars Africa will utilise Transnova’s appointment scheduling solution to manage transportation moves, dock capacity and appointment scheduling. “Transnova understands the market-specific obstacles food companies face with a lack of visibility into the transportation process,” said David Hallett, supply director at Mars Africa. “Now by leveraging technology in-house to manage our transportation, we anticipate better control of our costs and greater visibility into the transportation process, thus resulting in improved cost savings.” Added Eric Gower-Winter, director and co-founder of Transnova, “Transnova is committed to helping our clients reduce transportation spend, improve services, and gain complete supply chain visibility by optimising their transportation management.”

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The 2013 panel included (from left) Estienne de Klerk, president of SAPOA; Stan Garran, the executive director and head of IPD South Africa; Dr Azar Jammine, director and chief economist at Econometrix; JP Landman, a selfemployed analyst on political-economic trends; and chaired by David O’Sullivan.

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July 2014 • Logistics News

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First FAW rolls off line The first FAW commercial vehicle built in South Africa, rolled off the assembly line at the FAW Vehicle Manufacturers SA production plant at Coega, in the Eastern Cape, in July. The new plant is one of the largest investments made by a Chinese entity in SA to date, and has been financed by China FAW Group Corporation and the China-Africa Development Fund (CADFund). The cost of the establishment of the plant and its associated infrastructure is said to be US$60-million (about R645-million). The Coega plant with its build-capacity of 5 000 units per annum, represents the first high-quality Chinese manufacturer to set-up and contribute on this scale in the Eastern Cape region. FAW SA will be the first OEM to locally build its entire range of commercial vehicles sold here – 14 models spanning the medium, heavy and extra-heavy commercial vehicle segments.

Plans include the commissioning of a body-building facility at the Coega plant. Tipper truck bodies, mixers and customised trailers will be built in a facility, nearing completion, adjoining the main plant. FAW will be the first SA-based OEM to offer its body-building facility to other commercial vehicle manufacturers.

Cross-border marketing Summit for Africa T he A frican M arketing C onfederation will be hosting its first continental Summit from 15-18 October, at Victoria Falls, Zimbabwe. This event is co-hosted by one of the AMC’s founding members, the Marketers Association of Zimbabwe (MAZ), with the other five founding members in support: Chartered Institute of Marketing Ghana (CIMG); National Institute of Marketing of Nigeria (NIMN); Marketing Society of Kenya (MSK); Zambian Institute of Marketing (ZIM); and the Institute of Marketing Management South Africa (IMM). The 2014 AMC Summit and Exhibition is anticipated to attract up to 500 delegates from across the continent and speaks to academia, chambers of commerce, CEOs, marketing executives, government officials and the logistics industry. The theme: Cross-border markets in Africa: challenges or opportunities, will be addressed by three highly regarded keynote speakers: Dr Frannie Léautier, Dr Martyn Davies and marketing guru Thebe Ikalafeng. A presentation will also be provided by Victor Kgomoeswana, author of the recently launched book Africa is Open for Business. President of the AMC, Helen McIntee, says: “We expect

July 2014 • Logistics News

the Summit to motivate improved industry standards and prove that African products and services need no longer to be marketed from a distance. Becoming Africa-specific is crucial to any investor and they must be guided by regional professionals who can help integrate their offerings into an African context. “Africans themselves are demanding unprecedented levels of satisfaction. Conglomerates that are expanding into, and onto, the continent need to ensure a consistent, and relevant, marketing strategy despite cultural, language, and operational barriers. Marketing templates used by multinationals on continents like Europe, Asia and America are just not going to cut it in Africa,” says McIntee. • Exhibitor, sponsorship and delegate registration information can be found on the website: www.africanmarketingsummit.org

Aluvin partner Mega Fortris enters SA

Aluvin MD Kevin Norwitz (left) and Wesley Rousseau, MD Mega Fortris SA.

Vikela Aluvin, the largest security sealing company in SA, has announced that one of its international partners, Malaysian-based Mega Fortris, has opened an office in SA. Aluvin has been the official distributor of Mega Fortris products for the past 12 years. Mega Fortris is one of the world’s largest security seal manufacturers and is widely acknowledged for its product and design innovation, evident in its comprehensive range of high quality security seals, from conventional mechanical seals, RFID-enabled electronic seals and its widely recognised ‘journey management’ and ‘end-to-end monitoring systems’ for active RFID asset management and casino management. Aluvin MD Kevin Norwitz says Aluvin’s manufacturing and distribution success in the SA market over the past 60 years encouraged Mega Fortris to establish its local office to penetrate deeper into Africa, where there is growing potential for security sealing products and solutions.

Logistics challenge with a difference

What do you do if you buy a luxury sports car in the box (literally) and you want to import it, and offload it, safely and carefully, in very limited space in SA? That is exactly the dilemma recently faced by an owner of a luxurious Lexus sports car valued at R5-mn, that arrived from abroad, tightly wrapped in a metal shipping container and which had to be uploaded and offloaded again in severely restricted space – without a scratch. The owner is a prominent client of Avis Forklift Centre, so it was logical to approach Avis who accepted the challenge without hesitation. Avis Forklift Centre uploaded the container, transported it and offloaded it again – safely. The next step was to extract the vehicle, nervously and carefully, from the container to reveal it to its new owner. Mission successfully accomplished!

SupplyChainOnline is an electronic newsletter emailed weekly to some 15 000 industry professionals, providing access to the latest news, thought leadership articles, book reviews, industry associations and events calendar. SupplyChainOnline also provides you with a company directory - a comprehensive network with the logistics and supply chain industry at your fingertips. Should you wish to be listed in the SupplyChainOnline directory, or to receive the weekly newsletter, register on

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Strong demand for Dube TradePort’s offerings

New beginnings for an entire mining town

If you happen to be in the Northern Cape and you’re looking for the town of Sishen, change your GPS to search rather for Dingleton. Sishen was renamed Dingleton in 1990 and was originally established in the early 1950s to accommodate local miners working at Sishen iron mine. Although the area has significant potential for further iron ore mining, it had been limited because Dingleton is situated a mere 500 m away from the mine’s open-pit boundary, which is the minimum required blasting distance from human settlements according to legislation. To allow for mining in the buffer zone, the community was relocated to the town of Kathu, about 30 km away. As a result, an entire town had to be relocated to allow for such expansion. Africa’s leading manufacturer of prefabricated buildings, Kwikspace Modular Buildings, was required to erect, in three months, a 1 000-person camp that included the supply of 129 prefabricated accommodation units as well as a kitchen and diner, a mobile recreation building, 20 change rooms and ablution units and two site offices.

In a little under 24 months Dube TradeZone has been transformed from serviced stands to a 26-hectare construction site, which has netted Dube TradePort over R730-million in private investment, running far ahead of the outcomes anticipated in the Master Plan. Seven new industrial developments are currently taking shape in the TradeZone, with manufacturing in the electronics sector, packaging and logistics forming the core of the latest investments. A specialised clustering approach concentrates on encouraging and supporting inter-firm collaboration, institutional development and support in targeted industrial sectors that offer the most local economic development potential. Dube TradePort’s sector strategy includes targeting the cluster development of electronics manufacturers for the Trade Zone. Electronic goods constitute one of the most airfreighted product groups both locally and globally as they are predominantly lightweight, high-value and form part of the ‘just-in-time’ supply chain system. Two facilities have already been leased to international companies. It is imperative as a logistics company operating internationally, that sea, air and land modes of transport are utilised to connect the world and Dube Trade Port, which also enables easy access to King Shaka International Airport, and both Durban and Richards Bay harbours.

July 2014 • Logistics News

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Demand for innovative locomotive technology

Demand for industrial Funkey shunting locomotives manufactured by DCD Rolling Stock has remained stable across Africa in volatile market conditions, thanks to the tried-and-tested performance offered by the range over decades. Johannesburg-based DCD Rolling Stock is a division of international manufacturing and engineering company DCD Group, and is recognised as a leading manufacturer and supplier of locomotives, wagons and bogies to railway, mining and industrial operations. DCD Rolling Stock general manager Petrus Mulaudzi notes that the most recent order for a 37-tonne diesel hydrokinetic (DHK) Funkey shunting locomotive was made by a colliery in Botswana, following orders for 24-tonne and 35-tonne units from clients over the past five years. The Funkey

Linde donates forklift to foodbank SA

Over 11- million South Africans don’t know where their next meal is coming from. Hunger is not a matter of lack of supply; rather the problem is one of access and logistics. Every day huge volumes of good food are wasted. Towards the end of 2008, a number of leading hunger relief organisations, including Feedback Food Redistribution, Lions Food Project, Robin Good Initiative and Johannesburg Foodbank, agreed to amalgamate their operations to form a new organisation – FoodBank South Africa. On a national basis, FoodBank SA works to source donated food and other grocery products, and then distributes these products to hundreds of organisations across the country, providing 41 500 meals a day. Linde Material Handling recently donated a forklift truck to the Johannesburg branch. As a result, FoodBank SA has been able to transform its warehouse into a well organised and highly functioning facility, having a positive impact on the service provided to beneficiary organisations.

July 2014 • Logistics News

locomotive has been available in SA since 1930, and has remained a market leading product ever since. Mulaudzi points out, however, that cheaper imports from China have proven to be a challenge recently. “The African mining sector is cost driven and cheaper equipment is always appealing. The long-term costs can prove to be far higher, as these locomotives are of an inferior quality and require considerably more maintenance and repair. A major trend among Chinese manufacturers is the tendency to deliver the locomotive onsite without providing any warranties or support.”

N-S Corridor is a regional challenge

E mmanual Chaves, CEO of Mozambique’s airports, has urged SADC to take the North-South Corridor’s development on as a regional challenge. He was speaking at the ‘North-South Corridor Development: China Africa co-operation forum’, at the Southern African Transport Conference in July. “Countries like Malawi, Zambia, and Zimbabwe will be well served with alternatives to take their products out of the continent through maritime and railway transport and I encourage the region to focus on the project because Africa should not have to wait for long to have the corridor operational, so that we can give more options to landlocked countries,” said Chaves. Despite its obvious benefits to the continent’s development, Intra-Africa trade links are disturbingly low, with the majority of the region’s trade occurring with Europe, America and China. Eight of Africa’s 52 states are currently linked to the North-South Corridor project, with clear aims of expanding the project all the way to Cairo. Ofentse Sibetlo, DTI’s deputy director, Economic Infrastructure and Logistics, pointed out that the greatest challenge for the continent was around infrastructure development and that while the eight African countries linked to the North-South Corridor were glaringly different, they shared similar core issues around underdeveloped infrastructure.

Forthcoming Events CIPS

Event: CIPS Pan African Conference Date: 29-30 July Venue: InterContinental, Lusaka, Zambia Contact: Enquiries: conference@cips.org.za Online booking: http:// www.cips.org/en-ZA/Events/Pan-African-Conference/

LAA

Event: 26th Annual Logistics Achiever Awards 2014 Date: 18 September Venue: Montecasino Ballroom Contact: Dianne Holton, Tel 011-874-7697; www.logisticsnews.co.za

CSCMP

Event: CSCMP Conference Date: 21-24 September Venue: San Antonia, Texas Contact: Madeleine Miller-Holodnicki, email mholodnick@cscmp.org

TRANSAFRICA

Event: TransAfrica Transport, Infrastructure & Investment Expo Date: 7-9 October Venue: Johannesburg Expo Centre, Nasrec Contact: Website www.transafricaexpo.co.za; Email info@transafricaexpo.co.za; Tel +27-11-494-5638

Book your LAA table now Logistics Achiever Awards

The 26th annual Logistics Achiever Awards 2014 Date: 18 September Venue: Montecasino Ballroom Contact: Diane Holton Tel: 011-784-7697 www.logisticsnews.co.za

Logistics News goes DIGITAL Logistics News June 2014

the independent voice of the

Supply Chain

industry

WES and Demand management

ALSO:

Evolution of cold chain • China in Africa • Challenging Amazon • B2B e-commerce arises • Internet of Things • Forecasting

Logistics News May 2014

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RFID and Mobile Computing

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Retail RFID strategies • Service mobility in the cloud • Freight forwarding challenges • SC financing • Cost of sustainability • Senior placings for women

Logistics News April 2014

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Subcribe online for the printed or digital versions

www.logisticsnews.co.za

Outsourcing and distribution

ALSO:

global freight • commercial vans • mobile marketing • sustainable packaging • SC talent crisis

industry

Directory of supporting

industry associations CGCSA Consumer Goods Council of South Africa 0861-242-00 • www.cgcsa.co.za CILTSA Chartered Institute of Logistics and Transport SA 011-789-7327 • www.ciltsa.org.za CIPS Chartered Institute of Purchasing and Supply Southern Africa 012-345-6177 • www.cips.org/southernafrica CSCMP Council of Supply Chain Management Professionals SA Round Table 011-678-1820 • www.cscmp.org RFA Road Freight Association 011-974-4399 • www.rfa.co.za SAAFF SA Association of Freight Forwarders 011-455-1726 • www.saaff.org.za SAEPA SA Express Parcel Association 0861-106-402 • www.saepa.org.za SAIIE Southern African Institute of Industrial Engineering 011-607-9557 • www.saiie.co.za SAPICS The Association for Operations Management of Southern Africa 011-023-6707 • www.sapics.org.za SASC SA Shippers Council 013 247 3026 • www.sashippers.org.za SCC Supply Chain Council 011-918-7518 • www.supply-chain.org

July 2014 • Logistics News

Logistics News Celebrating 31 years as the independent voice of the Supply Chain industry

Publishing Editor: Dianne Holton Editorial & advertising: Tel: 011-784-7697 Fax: 086-515-5247 info@logisticsnews.co.za P O Box 784621, Sandton 2146, South Africa www.logisticsnews.co.za www.supplychainonline.co.za Deputy Editor: Michael Brandt Consulting Editor: Gerard de Villiers Advertising: Juanita le Roux Tel: 082-494-6592 juanita@logisticsnews.co.za Subscriptions: www.logisticsnews.co.za Design & DTP: Kerry Dimmer – Tel: 011-792-1930 Repro and Printing: Paradigm Print Tel: 011-683-1911 The publisher is not responsible for the opinions expressed by individuals. © No part of the publication may be copied or reproduced by any mechanical or electronic means without the written permission of the publisher. 31st year of publication. ISSN 1025-0492

Logistics News July 2014

the independent voice of the

Supply Chain

industry

Freight forwarding

ALSO:

B2B • Global account management • Freight logistics• Facilities location • Training weapons

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