MHD Sep 2020

SEPTEMBER 2020

THE BIGGEST LOGISTICS CHALLENGE OF A LIFETIME

How the world’s supply chains are preparing to deliver a COVID-19 vaccine

MEGA BENEFITS WITH MICRO-FULFILMENT

Answering the most pressing questions around the latest trend COVER STORY

TRANSFORMING THE GROCERY SUPPLY CHAIN Australia’s largest independent grocery retailer automates

Conquer Supply Chain Complexity

Learn More

The challenge – the opportunity – the solution Pre 2005

22%

of people shopped online

2020

By 2021

‘bricks and mortar’ retail businesses will close

of sales will be online

$ 4.5 trillion

2400+ 95%

will be generated by those online sales

Warehouse fulfilment

Online customers expect same or next day delivery and FREE P&P a s standard.

Technology is the backbone of ecommerce and the supply chain. Emerging online retail companies will only partner with a third-party logistics provider that is tech-savvy and adaptable.

This is known as the ‘Amazon Effect’

Warehouse management system Voice, vision and mobility

Robotics and automation

Software for optimising warehouse and distribution center management.

Gives warehouse pickers and packers hands-free and eyes-free movement, helping them work safely, quickly and accurately.

Helps the warehouse stay productive and efficient during peak times while picking up less fulfilling manual jobs.

Adapt Companies that have adapted their offerings and processes in order to be competitive with Amazon are thriving.

Deliver faster

Do the right thing

3PLs are in a unique position.

Those who choose wisely will be able to deliver faster and at a reduced price point, which is what the customers – and the retailers – want.

3PLs can conquer complexity and the ‘Amazon Effect’ with the right technologies, the right strategies, and the right partners.

End customers value speed and convenience over anything else.

Meeting these expectations will keep them coming back to the retailer, and keep that retailer competitive with Amazon. For more information, email us today at knowledge@koerber-supplychain.com

`

koerber-supplychain.com

MHD FROM THE EDITOR

MHD Supply Chain Solutions CONTACT MHD Supply Chain Solutions is published by Prime Creative Media 11-15 Buckhurst Street, South Melbourne VIC 3205 Telephone: (+61) 03 9690 8766 Website: www.primecreativemedia.com.au

THE TEAM CEO: John Murphy Publisher: Christine Clancy Group Managing Editor: Sarah Baker Managing Editor: Melanie Stark Journalist: Brittany Coles Business Development Manager: Bowie Phillips Design Production Manager: Michelle Weston Art Director: Blake Storey Graphic Designers: Kerry Pert, Madeline McCarty Client Success Manager: Janine Clements

FOR ADVERTISING OPTIONS Contact: Bowie Phillips bowie.phillips@primecreative.com.au

SUBSCRIBE Australian Subscription Rates (inc GST) 1yr (6 issues) for $78.00 2yrs (12 issues) for $120.00 – Saving 20% 3yrs (18 issues) for $157.50 – Saving 30% To subscribe and to view other overseas rates visit: www.tandlnews.com.au or Email: subscriptions@primecreative.com.au

ACKNOWLEDGEMENT MHD Supply Chain Solutions magazine is recognised by the Australian Supply Chain Institute, the Chartered Institute of Logistics and Transport Australia, the Supply Chain and Logistics Association of Australia and the Singapore Logistics and Supply Chain Management Society.

INVESTING IN SUPPLY CHAIN PAYS OFF

W

ith state borders closed, some shops and restaurants shut, and many businesses in disrepair, the Australian business sector was expecting to see disappointing results in this year’s reporting season, but it wasn’t all bad news.

Many of the companies that reported record profits this season are retailers, logistics providers and companies involved in the supply chain.

WiseTech Global, an Australian-based logistics software company, reported a revenue increase of 23 per cent, causing shares in the ASX-listed company to jump 29 per cent shortly afterwards.

Similarly, grocery retailer Coles’ investments in its supply chain has paid off with the company reporting profit growth for the first time in four years.

With the majority of Australians forced to shop online, it’s not surprising that e-commerce specialist organisations such as Catch, Kogan and online meal delivery service Marley Spoon, did very well this season.

There were also some wins across the traditional bricks and mortar retail sector. Bunnings reported a sales lift of nearly 14 per cent, Officeworks recorded a 20.4 per cent increase and JB Hi-fi also reported record growth.

The retailers who invested heavily in their supply chain and logistics operation are the frontrunners this year. This shift to online has changed where retailers’ priorities lie, with many exploring automation, technology and different strategies around fulfilment.

We explore this climatic shift on page 44 with the Körber Supply Chain team and its focus on micro-fulfilment.

As the COVID-19 vaccine race dominates the global news agenda, I also sat down with some of Australia’s leading logistics executives to understand what the next steps for the distribution of a vaccine will be.

With the supply chain and logistics industry innovating at a rate that’s never been seen before, the groundwork that is currently being developed to support the rise in e-commerce and online consumers might be the very infrastructure that is used to ensure a timely and efficient delivery of this crucial vaccine to all Australians.

ARTICLES All articles submitted for publication become the property of the publisher. The Editor reserves the right to adjust any article to conform with the magazine format.

COPYRIGHT MHD magazine is owned by Prime Creative Media.

All material in MHD is copyright and no part may be reproduced or copied in any form or by any means (graphic, electronic or mechanical including information and retrieval systems) without written permission of the publisher. The Editor welcomes contributions but reserves the right to accept or reject any material.

While every effort has been made to ensure the accuracy of information Prime Creative Media will not accept responsibility for errors or omissions or for any consequences arising from reliance on information published. The opinions expressed in MHD are not necessarily the opinions of, or endorsed by the publisher unless otherwise stated.

Melanie Stark Managing Editor melanie.stark@primecreative.com.au

MHD Supply Chain

MHD SEPTEMBER 2020 | 3

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SOLUTIONS FOR EVERY PALLET ®

SEPTEMBER 2020

ISSUE #8 VOLUME 50

THIS ISSUE COVER STORY

14 A self-sufficient supply chain

EVENTS 10 Healthy Heads in Trucks & Sheds 12 Women in Industry 2020 Winners 56 Supply chain vision in the decade for action

SUPPLY CHAIN

14

COVER STORY

18 From Ohio to Kalgoorlie 26 The biggest supply chain challenge in modern history 44 Mega benefits with micro-fulfilment 48 In the people business 50 A new normal emerges

TECHNOLOGY 22 Cotton sense 36 Automating Australian made 38 A new concept 42 The key to customer satisfaction

MATERIALS HANDLING

SEPTEMBER 2020

22

30 From millimetres to millions 32 Wrapped up in cotton wool 40 A juicy proposition for family business

DEPARTMENTS AND REGULARS

THE BIGGEST LOGISTICS CHALLENGE OF A LIFETIME

How the world’s supply chains are preparing to deliver a COVID-19 vaccine

MEGA BENEFITS WITH MICRO-FULFILMENT

06 News

Answering the most pressing questions around the latest trend

54 Property focus

COVER STORY

TRANSFORMING THE GROCERY SUPPLY CHAIN

56 ASCI

Australia’s largest independent grocery retailer automates

58 ALC 60 SCLAA 62 The last word

ON THE COVER Drakes Supermarkets has restructured its business and moved its supply chain operations in-house. MHD finds out more about its partnership with leading

26

intralogistics innovator, Dematic.

MHD SEPTEMBER 2020 | 5

MHD NEWS

Woolworths acquires PFD Food Services distribution centres for $249M

PFD Foods will enhance Woolworths’ store range location and provide fleet synergies.

W

oolworths Group has acquired 65 per cent equity of one of Australia’s leading foodservice suppliers, PDF Food Services. The deal includes ownership of PFD’s freehold distribution centre properties for $249 million.

On Wednesday August 19, Woolworths Group announced it has agreed to extend its strategic partnership with PFD Food Services.

Woolworths Group will initially invest $302 million in PFD to acquire a 65 per cent equity interest. The Group will also acquire PFD’s freehold distribution centre properties for $249 million which will be leased back to PFD. Woolworths Group CEO, Brad Banducci, said the Group is excited by the opportunity to invest alongside the Smith family in PFD Food Services.

Brad labelled the investment as a logical adjacency for Woolworths Group that will further support the evolution of Woolworths into a Food

and Everyday Needs Ecosystem.

“It is a business we have long admired and we have a shared vision for continued innovation, customer focus and investment in the food sector. We look forward to delivering even better experiences together for our customers as we continue to respond to their changing needs in a post COVID world,” he said in a statement.

Brad said the Group will help support

PFD’s growth through access to Woolworths logistics, digital and data analytics and operational capabilities.

“For Woolworths Group, it will enhance store range localisation and provide fleet synergies through better route and capacity optimisation across our combined network,” he said.

Transaction subject to ACCC approval and customary closing conditions.

Completion is expected by the end of this year.

Australian industrial and logistics sector proves to be resilient

I

n a Q2 Industrial and Logistics market update by Colliers International, findings show the impact of the pandemic is expected to be softer in the industrial and logistics sector, with demand for e-commerce products and grocery items increasing daily.

“While not immune to recent economic uncertainty, the Australian industrial and logistics sector has so far proven to be resilient, underpinned by the exponential growth of e-commerce as well as the reallocation of capital away from other sectors,” Malcom Tyson, Managing Director Industrial 6 | MHD SEPTEMBER 2020

and Luke Crawford, Associate Director at Colliers International said.

According to the market update, growth in online retail sales has accelerated with annual growth of 31.9 per cent in the year to June 2020, up from 13.6 per cent in January 2020.

“Retailers have moved quickly to strengthen their online presence and e-commerce platforms and blur the boundaries between these and physical stores. In recent months, we have seen Woolworths and Amazon among others commit to new facilities to drive their online and automation capabilities,” the Collier International executives stated.

Off the back of heightened demand for food logistics, institutional interest in the cold storage sector has grown significantly.

The lockdown period and the largescale work-from-home orders in response to COVID-19 has elevated demand for data centres as cloud storage requirements have grown rapidly. With occupiers seeking to move inventories closer to consumers and the potential to use automation to reduce the physical footprint of logistics spaces, there has also been growing interest in smallscale facilities designed to aid last-mile logistics near major cities.

KEEP YOUR GLOBAL SUPPLY CHAIN MOVING

When it comes to sea, air and customs services, trust C.H. Robinson.

Take control of your global supply chain with our industry-leading technology and local experts around the world.

Discover the power of C.H. Robinson at www.chrobinson.com

Š 2020 C.H. Robinson Worldwide, Inc. All rights reserved.

MHD NEWS

Coles investment in supply chain boosts company revenue

Coles has invested heavily in its online offering.

I

n the supermarket giant’s fullyear results released on Tuesday 18th August, Coles’ has reported profit growth for the first time in four years. Net profit from continuing operations rose 7.1 per cent to $951 million. Coles credits its performance to pop-up distribution centres, stock replenishment system and advanced data analytics.

Coles reported full year sales revenue increased by 6.9 per cent to $37.4 billion with sales revenue growth across all segments. Sales at Coles’

supermarket sector was up 6.8 per cent to $33 billion for the full year, with comparable sales growth of 5.9 per cent.

“Coles supply chain performed well despite the extraordinary strains of increased demand for pantry and ambient lines during the panic buying period,” the Group stated in the results.

“This performance was helped by recent investment in capacity, including pop-up distribution centres, but also the integrated stock replenishment system and advanced data analytics to improve availability.”

Coles Online sales revenue grew by 18.1 per cent for the year after services were temporarily disrupted in March and April during the COVID-19 pandemic.

Investing heavily in online throughout the year, Coles is expanding capacity in Home Delivery, largely through extended pick times and the recruitment of additional drivers. Click & Collect capacity was predominantly delivered through

the expansion of contactless Click & Collect.

The Group stated that using advanced data analytics to ensure the right product was offered in the right store took place across the majority of categories and on a more regular basis, capturing the latest innovation in the market in areas such as ready meals, health foods, coffee and pet food.

“Coles continued to optimise the network as part of its tailored store format strategy with 70 store renewals completed during the year, representing the biggest renewal program since 2012.”

Development and construction of the Witron ambient automated distribution centres and the Ocado online fulfilment centres will continue next year and beyond.

Approximately $100 million of capital expenditure was also incurred in relation to the Witron ambient automated distribution centres with the Queensland distribution centre build commencing during the year.

MEGATRANS set to return in April 2021

W

ith COVID-19 disrupting so many facets of life in 2020, MEGATRANS is excited to return from 14-16 April 2021 as one of the industry’s first face-toface events, as we reimagine the way the freight and logistics supply chain will operate in the face of the COVID challenge.

MEGATRANS is an integrated trade exhibition and conference showcasing the full freight and logistics supply chain, spanning warehousing and logistics, through to multimodal freight and final mile delivery.

After a disrupted year where faceto-face business interactions have 8 | MHD SEPTEMBER 2020

been dramatically reduced, physical events that allow you to engage with potential customers will be more important than ever and can provide a valuable advantage over any competitor who is not on display in the exhibition.

MEGATRANS will facilitate the industry’s best opportunity to showcase innovative solutions to the challenges that COVID has brought to a wide audience, with a strong focus on the retail and foodservice sector.

Trade exhibitions will look a little different in 2021, with a raft of health and safety protocols to be implemented as directed or

recommended by authorities and safety experts at the relevant time.

MEGATRANS thanks the majority of 2020 exhibitors and sponsors who have carried across their support to the new dates and are now accepting new exhibitor enquiries. Spaces are strictly limited, and the event is encouraging you to book now to ensure you can secure your exhibition stand.

MHD EVENTS

MENTAL HEALTH FOUNDATION LAUNCHED

Representatives from Australian road transport and logistics industries have joined forces to launch Healthy Heads in Trucks & Sheds Foundation, the first single national industry-wide approach to tackling mental health and wellbeing.

T

he Healthy Heads in Trucks & Sheds Foundation is an initiative between road transport, warehousing and logistics operators to support drivers and logistics workers with issues relating to mental health and physical wellbeing.

Woolworths Group, Coles, Linfox, Toll, Qube and Ron Finemore Transport have all combined as corporate partners of the Foundation with support from the National Heavy Vehicle Regulator (NHVR) and the Federal Government.

Paul Graham, Chief Supply Chain Officer at Woolworths, Chairman of Healthy Heads in Trucks & Sheds and Patron Lindsay Fox, along with a panel of industry figures and experts, officially launched the foundation via a live webinar conference on Tuesday 18 August 2020. ”I’ve seen the impacts mental health can have on people in our industry and I know it’s time we speak up on this issue as much as we have done on safety,” Lindsay Fox said.

During the virtual launch, Deputy Prime Minister Michael McCormack announced an additional $600,000 to support Healthy Heads on top of the Federal Government’s initial investment in road safety.

He said truckies have kept the nation moving during the COVID-19 pandemic and acknowledged industry hardship during current border closures across the nation.

“We’ve adopted a national protocol and working with states to make sure that there is that fluidity and consistency across our borders,” Deputy Prime Minister Michael McCormack said.

“We don’t want our truckies being held up, have inconsistent approaches through the various state jurisdictions.”

10 | MHD SEPTEMBER 2020

Paul Graham, Chief Supply Chain Officer at Woolworths is the Chairman of Healthy Heads in Trucks and Sheds.

Senator Glenn Sterle was previously a truck driver who regularly commuted the Darwin to Perth route and welcomes the initiative for current transport workers facing today’s supply chain challenges.

“For the generation I was in, you weren’t allowed to show a weaker side or a softer side,” he said.

Glenn said it was personally hard for him to navigate his truck schedule with family life. “I had to leave my wife and three-year-old with our brand new oneday-old baby to head straight back up the highway again… I didn’t see my son for another 14 days later,” he said during the foundation launch.

“I didn’t want to leave home and we didn’t have any of this support back then, “If the supply chain is also part of this magnificent opportunity to improve the health of our truck drivers, it must be commended. I can’t wait to see the results as this starts coming through.”

Mental health and wellbeing is a major issue in the Australian road transport and logistics sector with one in two transport workers having had a lived experience as reported by leading mental

health organisation SuperFriend.

According to its 2019 Indicators of a Thriving Workplace Survey, the transport, postal and warehousing industries ranked lowest for mentally healthy workplaces out of 19 other industries, with only 37 per cent of the industry taking action to improve outcomes.

Paul Graham said he wants everyone in the transport and logistics industry to know it’s OK to not feel OK and that our mental health needs to be actively managed just like our physical health.

“In our industries, we face additional challenges based on the nature of our work. Drivers and logistics workers often feel pressure from long hours, fatigue, traumatic incidents, isolation and social disconnection,” “This can lead to things like depression, anxiety, poor diet, lack of exercise, addictions, family problems at home and a whole raft of other issues.

Together we believe we can create not just a better environment for people to work in but a safer place for individual mental health and wellbeing.”

The Foundation is built on three key pillars: increasing the number of people trained in mental health at road transport facilities nationally; standardising policies and processes across transport and logistics industries to destress the environment for drivers; and focusing on individual mental health and improved wellness through education and resources.

The Foundation relies on its partnerships, industry sponsorship and government funding to carry out its objectives. ■ If you need to talk to someone or need support please call Lifeline at 13 11 14.

Flexible, Scalable Automation – Micro-fulfilment Ready

Körber's AMR Solutions

Autonomous Mobile Robots Your fulfilment centre is the lifeblood of your commitment to your customers. Give your operations a boost with AMRs, designed for greater flexibility and access to more diversified applications. AMRs are the new answer to flexible automation allowing operations to rapidly scale, expedite and even completely pivot to new forms of workflows and fulfilment processes.

Improve your floor operations such as picking and moving through to table-top sortation or create your micro-fulfilment centre. AMRs offer flexible automation with significant cost savings, rapid deployment timeframes and phenomenal throughputs.

Diverse AMR Portfolio At Körber, our AMR solution stack has been designed to maximise variety, applications and best-in-class quality.

It features Körber AutoSort Mobile table-top sortation solution and the diverse offerings by Geek+, Locus Robotics and Fetch Robotics, all expertly integrated by Körber.

Unmatched Experience Körber leads the AMR success record within supply chain proving up to 400% increase in efficiencies. Partner with Körber’s dedicated AMR team with extensive DC workflow knowledge and support capabilities.

1300 66 93 94 info.sc.mel@koerber-supplychain.com

koerber-supplychain.com

MHD EVENTS

WOMEN IN INDUSTRY 2020 WINNERS Women representing some of Australia’s leading companies in the industrial sector have been recognised for their achievements in their workplaces.

T

he 2020 Women in Industry (WII) Awards recognise and reward the achievements of women working within various industries including logistics and transport. This annual event is an opportunity to highlight excellence and is a form of empowerment for women by putting the spotlight on female rising stars changing the agenda across a depth of sectors represented.

Kelly Godeau, AMGC director and member of this year’s WII judging panel, says the WII awards are an important reminder of the outstanding work that is being achieved, and a chance to recognise all women who have been nominated. “At the same time, we must pause regularly to celebrate the small wins along the way,” she says.

“We saw nominations from some of Australia’s largest businesses through to smaller companies that expressed the same large size of pride on the work their female staff contributed. The level of commitment these nominees dedicated to their roles exceeded what would be deemed necessary. It really is a proud moment for these women and our industry.”

Rising Star of the Year Alicia Heskett - Shell Australia (QGC) Business Development Success of the Year Rachael Ashfield - ifm efector Industry Advocacy Award Rose Read - National Waste & Recycling Industry Council Safety Advocacy Award Nadine Youssef - Sydney Trains Mentor of the Year Dayle Stevens - AGL Energy Excellence in Manufacturing Rochelle Avinu - Leica Biosystems Excellence in Mining Sarah Withell - Whitehaven Coal Limited Excellence in Engineering Elizabeth Taylor - RedR International Excellence in Transport Melissa Strong - Lindsay Australia Limited Melissa Strong, Excellence in Transport winner, says she feels very fortunate to have found an industry she is passionate about working for.

She believes there is more work to be

done around diversity and inclusion and providing a framework that will help businesses integrate this as part of their overall business strategy.

“The variety of opportunity within the Transport Industry is extensive, as an essential service, the current pandemic environment we are now all learning how to operate in, has highlighted to the broader community the importance of our industry,” she says. Melissa hopes to set an example in encouraging others to seek opportunities in transport. “It doesn’t matter where someone starts out, but to keep learning and be open to opportunities. You never know where it will lead you.”

Melissa Donald, NAWO Board Member, and member of this year’s WII judging panel, congratulates the 2020 winners, whose achievements can inspire more women and men to pursue careers in operations, and continue to drive better gender balance across all industries. ■

2020 WINNERS Social Leader of the Year Jackie Lewis-Gray - BAE Systems Australia 12 | MHD SEPTEMBER 2020

Melissa says she feels very fortunate to have found an industry she is passionate about.

LOGISTICS GETS SMART.

Material stores that record their inventory in real time. Shuttles that coordinate orders with each other. Transport systems that organize their routes independently. Intelligent sensor solutions from SICK are driving forward networking in production and logistics. They monitor objects, analyze data and make information available in real time throughout the entire supply chain. This makes processes more transparent and efficient – and above all smarter. We think that’s intelligent. www.sick.com/smart-logistics

MHD COVER STORY

A SELF-SUFFICIENT SUPPLY CHAIN With the introduction of Dematic’s Goods-to-Person picking technology, Drakes Supermarkets has automated and maximised order picking productivity at its new South Australian Warehouse. MHD finds out more.

D

rakes Supermarkets is an independent and privatelyowned Australian retail chain based in South Australia, named after owner Roger Drake. Specialising in supermarket retailing, Drakes is now the largest independent grocery retailer in Australia, operating over 60 stores across South Australia and Queensland.

As a company, Drakes has an annual turnover of more than $1 billion, employing over 5,500 staff members nationally. The company’s strengths lie in operating on the principles of a family business and a commitment to supporting local manufacturers 14 | MHD SEPTEMBER 2020

and suppliers. Drakes has kept its focus on the important aspects of the business, which concentrates heavily on consumers and their shopping experience.

DRAKES SUPERMARKETS’ NEW IN-HOUSE SUPPLY CHAIN After significant growth, Drakes became independent of previous partner Metcash in late 2019 in its South Australian operations, in an effort to re-brand its position within the retail grocery market and to construct a selfsufficient supply chain.

During the process of becoming

independent from Metcash, Drakes soon began to restructure its business and move its supply chain operations in-house, which resulted in the launch of its new distribution centre (DC) in Edinburgh North, South Australia. The large-scale 55,000 square metre DC now employs over 80 full-time staff, features $15 million worth of robotics, and houses 23,000 separate product lines.

Roger Drake, owner of Drakes Supermarkets, says the new centre is part of the business’ self-supply model.

“It is really important to us to continue to innovate as a business and provide opportunities and training

MHD COVER STORY

was to integrate a warehouse system that would streamline our operations, optimise store fulfilment and service levels and achieve a positive return on investment (ROI) through an increased level of productivity,” Roger says.

“It was also important that in switching to our new supply chain, we were confident that our operations and systems would be highly reliable and able to achieve maximum efficiency, so that the service delivered to our end customer – in this case, our stores was meeting or exceeding their needs and expectations,” Roger adds.

Drakes selected Dematic as its partner because of its well-established presence as an Australian company, its solid experience in the supply chain industry, its extensive experience in multi-million-dollar projects within the Asia Pacific region, and its knowledge of and experience working on Australian building sites.

Roger Drake is the owner of the Drakes Supermarkets chain.

for our existing staff and future local employees. We want to stimulate the South Australian economy by keeping it local and looking out for the interest of everyday families and customers in our state. Our aim is to save the average South Australian family around $20 per week at the check-out, which equates to over $1,000 per year, by just having direct relationships with our suppliers and cutting out the middle-man,” Roger says.

As part of its plan to build the new South Australian DC, following a thorough tender process, Drakes initiated a new partnership with leading intralogistics innovator, Dematic, who designs, builds and supports intelligent, automated solutions for manufacturing, warehouse and distribution environments for customers that are powering the future of commerce.

“Since we were constructing our new South Australian DC from the ground up, we wanted to ensure we were installing the most advanced supply chain systems that would be fit for purpose now and into the future.

Our goal in working with Dematic

A SOLUTION TO AUTOMATE AND STREAMLINE OPERATIONS Drakes selected the Dematic Goodsto-Person (GTP) Picking Solution as the system to be deployed at the new South Australian DC. “The central objectives that we wanted to achieve from the implementation of the Dematic GTP Picking Solution, was the establishment

of a supply chain system capable of high levels of efficiency and productivity through automation. Another goal in implementing the new solution was for it to be cost competitive against the previous Metcash model, so we could achieve a lower cost of distribution as a result,” John-Paul Drake, Director of Drakes Supermarkets says.

Tailored to Drakes’ operational needs, the Goods-to-Person Picking Solution, which is also integrated with robotic technology, was selected because of the pick rate it offered – completing over 600 order lines per hour and per operator, together with further picking productivity through the robotic picking cell.

“The major goals that we wanted to achieve for Drakes in deploying the GTP Picking Solution, was for it to be selfsufficient, and for all robotic, automated and technological advancements provided by the system to streamline operations and achieve maximum productivity within the DC,” Darren Rawlinson, Dematic’s Regional Solutions Development Director, APAC says.

The GTP Picking Solution delivers items directly to pick stations – eliminating the need for operators to spend time manually locating and retrieving items and travelling across the DC floor. The solution focuses on the challenging aspects of fulfilment by combining high-density secure

As part of its plan to build a new South Australian DC, Drakes initiated a new partnership with Dematic.

MHD SEPTEMBER 2020 | 15

MHD COVER STORY

storage with the rapid rate and high accuracy of directed picking, equipped with an ergonomic design to enhance operator performance.

The GTP Picking Solution receives inventory at decant workstations, where operators scan barcodes and transfer items into inventory totes, which are automatically weighed and then conveyed and stored in three aisles of Multishuttle Storage. This ensures maximum inventory accuracy in the system. For order picking, inventory totes are retrieved and sent to the picking stations, where lights and graphical instructions direct operators to pick the required items from the inventory tote.

The operator then places the items into order totes which can then be stored in a storage buffer ahead of despatch. Once the delivery run is released, the totes are retrieved prior to automated lidding, labelling, weighing, and scanning, and are routed to the despatch sorter. The inventory totes are then returned to storage, ready for the next order.

Drakes’ staff can work in parallel at the two Dematic RapidPICK stations, unaffected by each other’s pace, and the pick stations can be opened and closed according to the business volume of a particular shift. This ensures optimal

Drakes staff can pick in parallel at the Dematic RapidPICK stations.

16 | MHD SEPTEMBER 2020

picking performance regardless of daily, weekly, or seasonal fluctuations in throughput volumes.

“The solution requires minimal customisation, as all of the hardware and software are pre-configured – which significantly reduces costs and enables rapid installation and start-up.

The system’s compact configuration also uses space efficiently, allowing Drakes to better utilise space in its new DC,” Darren says.

The GTP Picking Solution runs on Dematic iQ software, which optimises all aspects of supply chain fulfilment, including direct picking into rightsized shipping containers through to reducing cycle times, labour costs, and shipping/transportation costs. Dematic iQ is also fully interfaced with Drakes’ existing Warehouse Management System (WMS).

Dematic also installed a storage solution at the new Drakes DC, with all materials that made up the pallet racking made in Australia.

THE SOLUTION ROLLOUT Drakes had a strict project deadline for its new South Australian DC, and the implementation of the GTP Picking Solution had to align with this. The

design, planning and approvals for the DC was completed successfully within the six-month timeline, with the building, fit out and testing phases taking a further 11 months for completion; employing over 300 local trades people throughout the process.

The new DC was finalised and started supplying to all South Australian stores in September 2019.

“Through large amounts of coordination, Dematic worked in collaboration with all other partners contributing to the construction of the DC, such as builders, technicians, and on-site managers. We had our highly experienced team onsite providing endto-end management and support to ensure a successful rollout was achieved as quickly as possible,” Terry Jamieson, Business Development Manager at Dematic says.

Dematic had a team of in-house project management, mechanical commissioning and controls and software personnel on-site throughout the implementation and testing phases of the GTP Picking Solution deployment project. Dematic also helped Drakes to develop guidelines and work processes and procedures for staff.

“During the rollout, Dematics’

MHD COVER STORY

highly qualified team worked to ensure that the system was integrated seamlessly,” Glenn Sutcliffe, Logistics Manager at Drakes Supermarkets says.

“They employed a detailed level of coordination that helped to optimise not only the DC space, but all elements of the system so that is was tailored to Drakes’ unique conditions.”

The GTP Picking Solution onboarding and training phase for Drakes’ staff was run by Dematic; providing an in-depth understanding of how to use all materials handling equipment, and the correct procedures to follow to ensure safe and efficient operations.

“Dematic encouraged a ‘train the trainer’ approach to developing a good working knowledge and understanding of the system amongst key operational and management personnel, so our supervisors could then pass on their knowledge to all employees working with the system. This helped to ensure that things were done correctly from the outset, so that the technology could be utilised properly and safely to achieve the best results for the overall business,” Glenn says.

SERVICE AND SUPPORT For all GTP Picking Solution requirements, Drakes is supported by Dematic’s ongoing service and support program, to help optimise system uptime and continuity of production efficiency at all times. This includes 24/7 support for all equipment and controls, as well as software and IT. “Our service and support program helps to provide resources that ensure the best level of productivity is achieved. By working to reduce things like system downtime due to component failures, we can in turn reduce the overhead costs of system maintenance for Drakes. The program offers assurance to Drakes that the system has been executed in the best possible way, by us, the people who designed and built it,” Terry says.

BENEFITS OF THE NEW SOLUTION For Drakes, being able to successfully take over the end-to-end management of its own supply chain has been the biggest achievement overall.

“We are very proud to have successfully built our own supply chain operations from the ground up. This was a major endeavour for us to take on and manage ourselves.

I am so pleased that we are now able to independently manage our supply chain. I am confident we are meeting the expectations of our stores, our customers, and our staff,”

“

It is really important to us to continue to innovate as a business and provide opportunities and training for our existing staff and future local employees.

”

John-Paul says.

The biggest benefits Drakes achieved by implementing the Dematic GTP Picking Solution within the new South Australian DC, was the system’s ability to offer high productivity and accuracy rates, as well as real-time visibility of order fulfilment.

From these improvements, Drakes now has the capacity to load 30 semi-trailer loads of orders per day and process 180 cartons per total labour hours. This compares to 58 cartons per hour being processed in other areas of the warehouse.

Operators using the GTP picking solution are picking over 700 units per labour hour.

The Dematic GTP Solution runs 16 per cent of the warehouse throughput using only four staff, which means only 5 per cent of the warehouse’s staff process 16 per cent of the product. The solution also delivers a very high picking accuracy rate for Drakes of 99.996 per cent, with the use of weigh scales following the picking stage resolving most errors before shipment.

Due to the automated warehouse system needing less warehouse space, Drakes was also able to drastically reduce the footprint of the new warehouse, leading to a saving of $10 million in land and building costs for their $11 million build. This meant the Dematic GTP Solution was able to deliver an immediate return on investment (ROI) for Drakes.

Moreover, the modular and scalable solution provides the flexibility to accommodate future changes and alterations to further optimise operations or to expand the system as the business grows.

Drakes is provided with performance insights from the Dematic iQ software, which helps to ensure all the KPIs of the system are being achieved and that Drakes can assess areas of the operation that can be further enhanced.

“From implementing the GTP Picking Solution, we have seen some incredible results for not only our overall DC operations, but also the efficiencies of our DC staff who, after using the new system, have greatly benefited from the easy-to-use process and overall task visibility that it provides,” Glenn says.

FUTURE PLANS In the next six months Drakes has plans to extend the modular Dematic GTP Picking Solution to increase order fulfilment capacity at the South Australian DC. The new DC was built with enough space for the system to be extended, with the addition of new modules, to increase capacity as Drakes continues to grow. ■ MHD SEPTEMBER 2020 | 17

MHD SUPPLY CHAIN

FROM OHIO TO KALGOORLIE: C.H. ROBINSON DELIVERS As part of its plan to upgrade its nickel operations in Kalgoorlie, BHP required a new filtration system to be shipped in four 24.4 metric tonne shipments from Ohio to Kalgoorlie. C.H. Robinson was able to deliver the project on time and under budget despite COVID-19 restrictions. MHD reports.

B

HP and C.H. Robinson have worked together for nearly 20 years. As the partnership has developed, Andrew Coldrey, Vice President – Oceania at C.H. Robinson says the relationship is mutually beneficial.

“We have learnt from them and they have learnt from us. In their world you really need to be agile and adaptable and when working with us it became apparent that we are a business who can deliver on our promise, particularly for tailored solutions,” Andrew says.

BHP leverage C.H. Robinson’s use of tech and data to make better decisions and the relationship has gone from strength to strength as BHP has come to trust and rely on C.H. Robinson’s logistics and supply chain expertise.

FINDING THE RIGHT LOGISTICS PARTNER

As part of its nickel operations upgrade in Kalgoorlie, BHP needed to replace the filtration system for their main stack.

18 | MHD SEPTEMBER 2020

C.H. Robinson’s office in Perth is already part of BHP’s daily shipping needs to and from Kalgoorlie. The strength of this existing relationship led BHP to approach the team to explore a well-orchestrated logistics plan for a new filtration system for its smelter upgrade project.

As part of its nickel operations upgrade in Kalgoorlie, BHP needed to replace the filtration system for their main stack. Careful coordination and precise timing were top priorities for BHP during this process to avoid additional shut down time.

The filtration system was manufactured in Ohio, US and would be shipped in four shipments to be assembled and installed on

MHD SUPPLY CHAIN

Andrew Coldrey is Vice President Oceania at C. H. Robinson. location in Kalgoorlie.

Each unit weighed 24.4 metric tonnes each and even when moving in separate sections, the modules were still considered out of gauge cargo.

“With cargo of this size there are so many considerations. Road weight restrictions across multiple states in the US and Australia, varying weather conditions across the two hemispheres, ramps and lifting equipment and ultimately the value of the cargo. This is no mean feat,” Andrew says.

Initially, BHP asked the manufacturer to handle the logistic of the move. The Ohiobased company proposed shipping from the Port of San Diego, which would require more than 3,700 kilometres of over the road transportation across the US. From there, each shipment would also need transloading – leading to additional shipping time and the potential for damage from extra handling.

However, Stephen Reynolds, Acid Plant Project Manager at BHP thought there was an opportunity to find a better solution. “One of the reasons for our success is that we find people who know what they’re doing. We’re mining experts. When we started planning this project, we realised we needed to find logistics experts,” he says.

NO TWO SHIPMENTS ARE THE SAME “At C.H. Robinson, we approach each and every project with a fresh pair of eyes. Our project team take the approach that no two shipments are the same,” Andrew says.

With a global network of experts, C.H. Robinson is able to lean on local expertise, data and technology to come up with the most efficient logistics solution.

“We start from the point of view of simplifying the route as much as possible.

The more times you touch it, the more risk there is of delays. Ultimately, we want to speed up the transport to Kalgoorlie

“

With cargo of this size there are so many considerations.

Road weight restrictions across multiple states in the US and Australia, varying weather conditions across the two hemispheres, ramps and lifting equipment and ultimately the value of the cargo. This is no mean feat.

”

Kane Dunleavy is Project Logistics Manager at C.H. Robinson. and avoid any complexity in transhipping and handling the cargo more times than necessary,” Andrew says.

This philosophy led the team to propose an entirely different route to the initial route proposed by the manufacturer, and with great results.

C.H. Robinson recommended shipping the modules through the Port of Baltimore. While this choice would require the shipments to travel through the Panama Canal, it came with several other benefits for BHP. This route significantly reduced the road transport in the US to around 800 kilometres, which saved an estimated $100,000 USD from the budget. It also eliminated the need for transloading, with all ocean transit occurring on one vessel. The freight was also stowed under deck, using roll-on/roll-off, which protected it from the elements.

Once in Australia, the freight would travel via flatbed trailer across 600 kilometres from the Port of Fremantle to Kalgoorlie. As the items were out of gauge, C.H. Robinson needed to secure necessary permits and coordinate truck transit times to ensure all laws were followed without foregoing the schedule.

“At first this route may have appeared left of field, but it enabled us to deliver the project ahead of time and save BHP significant costs,” Andrew says.

DELIVERED DESPITE COVID-19 Two shipments into the project, COVID-19 began to spread and disruptions were felt across the global supply chain.

Kane Dunleavy, Project Logistics Manager at C.H. Robinson was onsite in Ohio, Maryland and Western Australia to oversee the loading and unloading of the freight for the first two shipments. However, when COVID-19 travel restrictions were in place, Kane was not able to travel.

MHD SEPTEMBER 2020 | 19

MHD SUPPLY CHAIN

The BHP site is in Kalgoorlie in Western Australia.

However, as the planning and processes had been carefully mapped out beforehand, the project was not impacted.

Communication accelerated during this time, and Kane kept the project moving with daily updates.

“We increased our communications on all of the touch points. Phone calls, emails and taking photos to make sure that BHP was across everything,” Andrew says.

For Andrew, this kind of approach is beneficial for all parties involved. “Being in direct contact regularly with project managers and engineers is important, as sharing information is beneficial for all of us. Sometimes they have an insight that we don’t have, and by sharing information and making sure everyone has an opportunity to contribute, we can mitigate risk and ensure the entire project runs smoothly,” Andrew says.

Due to quick thinking and fast planning, BHP worked with the manufacturer and their own employees in Kalgoorlie to ship the third section a full seven days early. This small timing shift was significant in that it gave BHP much needed time to receive and install the section prior to COVID-19 lockdowns.

METICULOUS PLANNING GETS RESULTS The smelter in Kalgoorlie can produce 200 tonnes of nickel concentrate per hour. Each hour the smelter is inoperable, profits are impacted. C.H. Robinson’s meticulous planning meant that the plant only needed to shut down for a total of 16 hours, instead of the initial 100 planned.

C.H. Robinson was able to deliver all four shipments without any delays, despite two of the shipments taking place in an unprecedented global pandemic.

Andrew says he is immensely proud of the result and what the team were able to deliver.

20 | MHD SEPTEMBER 2020

Each unit of the shipment weighed 24.4 metric tonnes.

“

We increased our communications on all of the touch points. Phone calls, emails and taking photos to make sure that BHP was across everything.

”

“I couldn’t be happier with the outcome. All units arrived, spaced out exactly the right way, so that BHP could install them together in one integrated operation,” Andrew says.

This is echoed by Stephen who says that the solution C.H Robinson delivered saved a large portion of BHP’s initial budget for this part of the plant upgrade. “This in turn allowed us to make other upgrades that would have only happened in the 2021 budget.

With C.H. Robinson on our side, the project was everything we could have hoped for and more,” he says.

Andrew says this is logistics performing at its best. “Logistics is one piece, but by us doing our role well, BHP can achieve their broader company goals,” he says. ■

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MHD TECHNOLOGY

Lawrence Railton, Managing Director and Founder of AS Colour recognised a gap in the market for high quality basics.

COTTON SENSE

AS Colour, one of Australia’s fastest growing socially responsible and sustainable fashion labels shares how partnering with Manhattan Associates strengthened the loose threads of its supply chain to spin the brand into global success.

M

inimalist style has taken the fashion world by storm in recent years. In general, despite the focus one puts on their style, a basic white t-shirt is a staple and will never go out of fashion.

From hipsters to baby boomers, and from the modest to the trendsetters, neutral coloured clothing is a product desired by all. Fifteen years ago, Lawrence Railton, Managing Director and Founder of AS Colour recognised a gap in the market for high quality basics. Back then, e-commerce was a fresh concept and transactions were made through fax and ERP. Today the brand is regarded as one of Australia’s iconic fashion labels, with retail stores in fashion capitals across 22 | MHD SEPTEMBER 2020

the nation including Fitzroy and Chapel Street in Melbourne, Bondi in Sydney and West End in Brisbane. Although most AS Colour wearers are Australian, the brand was born and bred across the fence in New Zealand.

“It all began in a 300 sqm warehouse in New Zealand, with calls and emails from Australians wanting basic t-shirts,” Lawrence says. AS Colour has since expanded to a global presence with four distribution centres. “We recently opened a new 18,000 sqm warehouse in Melbourne, have a warehouse in Los Angeles and another one just outside of London.” With operations in four different time zones, Lawrence highlights the importance of finding a flexible warehouse

management solution (WMS).

Global support was a driving attribute in choosing Manhattan Associates as AS Colour’s WMS provider. Whilst auditing factories and developing the brand’s management systems and policies, AS Colour maintains an ethical sourcing framework. Lawrence says it’s more important the brand finds and works with factory owners and management who share the same values, operate a culture of dignity and respect, are in it for the long term, and who are willing to embrace change and continuous improvement.

REMOTE GO-LIVE Offices around the world have adapted from in person collaboration to virtual

MHD TECHNOLOGY

“ AS Colour’s philosophy is to build core quality basics, rather than chase fashion trends. meetings during the COVID era. For most companies, installing or upgrading solutions with clients have been postponed due to travel restrictions. Lockdown restrictions in all distribution points for AS Colour didn’t halt progress for the brand, as they are emerging from the pandemic stronger than ever.

Conferences to webinars and face-toface coffee meetings to e-meetings have successfully been done. But unlike Australia, New Zealand underwent a hard lockdown in March. “The whole logistics industry was grounded to a halt, there was no freight moving at all besides supermarkets. It was definitely a challenging time,” Lawrence says. Whilst tumbleweed was rolling through

We recently opened a new 18,000 sqm warehouse in Melbourne, have a warehouse in Los Angeles and another one just outside of London.

”

Auckland airport and highways, Lawrence and his team were building an entirely new WMS to integrate into their flagship distribution centre.

AS Colour is the first company in the world to implement Manhattan Associates’ SCALE WMS remotely via video communication.

Due to the consumer demand an evolving business model, Lawrence says their previous WMS had reached its end of life and lockdown couldn’t prevent the strong need to upgrade to a more versatile solution that could cope with AS Colour requirements.

Lawrence laughs when he recalls his wife asking, “do you have another Teams call again?” throughout New Zealand’s level four lockdown, but he was determined to be well equipped with knowledge and support from Manhattan, who were assisting via the internet 2000kms away.

In a matter of weeks, when most other warehouse productions had fallen to radio silence, AS Colour implemented their new WMS. “It worked so well; I don’t see any difference from in person to remote installation. It just proves you can receive quality service without the physical aspect and more companies will need to adapt to this contact-less style of business,” he says.

GLOBAL PARTNERSHIPS

AS Colour is regarded as one of Australia’s iconic fashion labels.

Lawrence notes that AS Colour is proud to have 100 per cent traceability of all its garment suppliers and believes that being transparent is a vital attribute in designing and manufacturing its premium apparel.

In total, the company has 16 garment factories in total with nine key factories. AS Colour’s core t-shirting range is produced in Bangladesh and 40 per cent of more detailed garments are produced in China.

AS Colour’s commitment to social responsibility extends beyond direct suppliers. With its suppliers consistently updating and improving their manufacturing facilities, by making full use of all the technological advancements in the textile industry, Lawrence says it’s also essential the WMS can continually comply with mobility to change too.

“Our business is a carbon copy in each country we operate in. We have high expectations and have a strict on-boarding process. We needed a solution’s provider who could be a partner to us, in the same way we are with our own suppliers,” Lawrence says.

Prior to lockdown restrictions, AS Colour was struggling with cycle counting efficiency and also due to its substantial business growth, as well as the introduction of new product categories such as its organic cotton MHD SEPTEMBER 2020 | 23

MHD TECHNOLOGY

AS Colour has stores in cities across the nation.

AS Colour has 100 per cent traceability of all of its garment suppliers. products. “During the pandemic we’ve seen a huge increase in our e-commerce sales as well as B2B and as more countries emerge from lockdown orders, we expect demand to continue,” Lawrence says.

He noted that a lot of customers who cancelled off-shore production are now turning to AS Colour as a life-line, which pushed the pedal to find a WMS provider in the early stages of the global pandemic.

“We needed to be able to make changes ourselves, but a global partnership and support to all four of our distribution points across the world drew us to Manhattan,” Lawrence says.

AS Colour went live with its new WMS during lockdown without one physical handshake from a consultant.

Looking back on the experience, Lawrence recalls the cost-saving aspect to the screen-time support. “Instead of burning lots of jet fuel flying around the world spending hours in transit, we could communicate at the push of a button. It was certainly a smooth and sophisticated process.”

Lawrence acknowledges the unique circumstances but notes the business has already reaped in the benefits of a quicker WMS installation that was done remotely. “We operate in New Zealand, which is already isolated on an island from most of the world, so we’re used to calling in to places and people around the world virtually. I’d say there is no challenge going live with a WMS 24 | MHD SEPTEMBER 2020

remotely, if anything, it’s much quicker - especially if you’re with a trusted and experienced provider.”

SETTING THE TREND “We’re not chasing market trends in the world of fashion, we’re building core quality basics,” Lawrence says.

Although the brand’s top selling product was designed eight years ago and is considered a timeless staple, AS Colour is setting the trend in its progressive way of modern business.

“Not only did we manage to go live with an entirely new WMS and integrate it successfully into our complex supply chain, it was delivered ahead of time, a couple of weeks earlier than expected,” Lawrence says. Despite the desire to keep testing the deployment, he says Manhattan consultants gave the company the confidence to go live.

“You can develop your own rules, change them and have flexibility, but support from global partners is how the business can continue to grow during this unknown time,” Lawrence says.

“It simply came down to learning the Manhattan solution, adapting with it and now actioning it to our full potential.”

He credits the video conference calls that have provided the brand with excellent training through a new medium of problem-solving. “We are now around seven times the size of what we were when we implemented our previous WMS, so the fundamental reason we partnered with Manhattan is to have

support that will leverage our growth of quality products,” Lawrence says.

“We choose not to have a logo; our apparel is purely on the fabric and quality of the finish. We know our products will be in our retail range for beyond ten years. As we sell our T-shirts as blanks for customisation, whether that be daily wear or for a uniform, we know our supply chain solution will stand the test of time too.”

With the Auckland warehouse now in full swing, Lawrence shares he is excited to open AS Colour’s new Melbourne warehouse in October.

“We’re also seeing our California business growing rapidly so we see our Manhattan solution going live beyond the Australia and New Zealand region.

Support doesn’t have to be physical, it’s incredible what can be achieved and how our work environments will continue to adapt,” he says.

AS Colour may not be a fast fashion company, but its commitment to its supply chain practice has enabled the brand to be fashion-forward in its production line. “Logistics isn’t rocket science. We are committed to all elements of production, including continuing to invest our time and resources into being socially responsible, while also understanding the true value of quality and cost of a product. These factors have definitely all contributed to the long-term success and sustainability of our supply base,” Lawrence says. ■

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MHD SUPPLY CHAIN

THE BIGGEST SUPPLY CHAIN CHALLENGE IN MODERN HISTORY The frantic race to develop a COVID-19 vaccine is on. From London to East Geelong, more than 16 different candidate vaccines exist worldwide, with at least 31 currently in clinical trial. MHD sits down with supply chain’s best and brightest to discover the logistical challenge ahead.

T

ypically, a slow and detailed endeavour, vaccines take years of research and testing before reaching a clinic. Clinical development of a vaccine is a three-phase process.

It starts with small group of people receiving the trial vaccine in phase one, to expanding safety trials in phase two, and large-scale efficacy testing in phase three.

As COVID-19 continues to take

One of the frontrunners in the race is the Oxford University collaboration with AstraZeneca.

26 | MHD SEPTEMBER 2020

the lives of thousands of people worldwide, destroying the global economy in its wake, the world’s most prominent researchers and scientists are working day and night to develop a COVID-19 vaccine.

At the time of writing, The New York Times Coronavirus Vaccine Tracker details 135 preclinical trials, with 19 in phase one, 12 in phase two, eight in phase three and two approved for

early or limited use.

One of the frontrunners in the race is the Oxford University collaboration with AstraZeneca, with the team predicting the vaccine could be available this year or early 2021. Closer to home the University of Queensland’s project with the Doherty Institute and CSIRO is currently in phase one testing.

With the Oxford team leading the way, at present the Australian Government

MHD SUPPLY CHAIN Vice President Oceania at C.H. Robinson says.

“All 190 countries will need this vaccine pretty much at once. This is a huge task,” he says.

LIFE-SAVING LOGISTICS

Modelling suggests around 1,000 charter flights will be needed to get the vaccine to everyone. has signed a letter of intent to secure 25 million doses of the vaccine. The government and pharmaceutical company AstraZeneca are in agreement that Australia would manufacture the vaccine, most likely at the CSL laboratories in Melbourne. Details around distribution and timing are yet to be finalised, but the wheels are in motion.

As we move closer to a vaccine becoming a reality, the logistics and supply chain world is preparing for the challenge of a lifetime in ensuring the safe, timely and efficient global distribution of the vaccine.

“At the heart of supply chain is marrying supply and demand. We have to forecast what is to come, the demand, the supply and how you bring that all together,” Dr Hermione Parsons, Industry Professor and founding Director of Deakin University’s Centre for Supply Chain and Logistics says.

For Hermione, the vaccine supply chain is the next big challenge in the pandemic. “We need to approach this as the complex problem solvers that we are. It’s about forecasting and working out a number of different scenarios so when it becomes a reality we can respond quickly and intelligently and work together to bring this important vaccine to everyone,” she says.

The distribution of a vaccine will require a concentrated global supply chain effort with rigorous forward planning, Andrew Coldrey,

“

This is very different to SARS, MERS or Ebola. This is a pandemic and every single person needs to be vaccinated.

This level of demand is something the pharmaceutical industry will never have experienced before.

”

Without even thinking about the logistical challenge of getting a vaccine dose to the world’s seven billion people, vaccines by their very nature present a number of complexities when it comes to freight.

“Vaccines are high value, highly sensitive, and temperature-controlled items.

Transporting vaccines (or any temperaturecontrolled product for that matter) require a highly coordinated approach, backed by trained people and certified infrastructure.

This includes intimate knowledge of the minute details such as packaging, packing, storing, air and land routing, timing, carrier selection, etc.,” Leonora Lim, Vice President, Life Sciences and Healthcare Asia Pacific at DHL says.

Furthermore, the products have a use-by date and associated quality controlled measures that need to be adhered to, says Tim Edwards, National Director – Victoria at Colliers International says.

“Vaccines are very susceptible to fluctuations in temperature differentials, exposure to UV light and contaminants. They generally require stable and controlled processes across transportation, storage and distribution, as per most pharmaceutical products. This will be challenging to achieve globally across existing infrastructure,” he says.

Depending on the characteristics of the vaccine, supply chain strategies may need to also account for associated equipment to administer the vaccine. The government is already working on this, and recently signed a $24.7 million contract with Becton Dickinson to supply 100 million syringes and needles that will be required in administering the vaccine.

According to Archival Garcia, VP Sales APAC at Microlistics, while a complex task lies ahead, it does not necessarily exceed those felt in cold storage or food and beverage distribution.

“Key factors will include security and verification, refrigeration and monitoring, tracking and traceability at the batch and lot level, and by user and machine involved in handling the goods, all the way to the medical practitioner administering the vaccine,” he explains.

CAPACITY CRUNCH According to Deakin University’s Hermione, it’s important to ask what the collapse of the aviation industry will mean in the planning of the worldwide distribution of a vaccine. “When COVID-19 was declared a pandemic, Australia’s MHD SEPTEMBER 2020 | 27

MHD SUPPLY CHAIN

air freight capacity collapsed by 92 per cent. We are an island, so what does that mean for access to high volumes of this time-sensitive vaccine and associated equipment?”

C.H. Robinson’s Andrew has similar concerns. “To fix the pandemic, we need to distribute a vaccine. But one of the consequences of the pandemic is that airlines have significantly reduced capacity, we need to get our head around this in any strategy or planning we develop,” he says.

We’ve seen industry adapt to ensure that Australians continue to have access to essentials such as PPE, masks and medical supplies.

The International Freight Assistance Mechanism (IFAM) has been established by the government to keep high-value, time sensitive and perishable goods and vital imports, such as medical supplies and other essential items, flowing as air freight capacity is down. Similarly, C.H. Robinson has worked tirelessly to ensure Australians have a sufficient supply of PPE throughout the pandemic.

“This not only shows the incredible complexity of the supply chain. But also shows the capabilities of the people who work in this industry in Australia. They are flexible and agile and do whatever needs to be done to get the right product, to the right person at the right time and have been doing a phenomenal job. But the pandemic has introduced levels of complexity previously unknown, requiring heightened skills and capability. The complexity in marrying supply and demand for the vaccine cannot be underestimated,” Hermione says.

Some modelling has already been carried out with regards to capacity around the distribution. “We have seen modelling that suggests around 1,000 charter flights to get the vaccine to everyone. But that’s based on a person only needing one dose. At this stage we have no idea if multiple doses will be needed, so it’s hard to know what kind of capacity we are looking at,” Andrew says.

A lot of work will need to be done determining the policy of who receives the vaccine first and how to create the most efficient way of distributing it to all. the Western world,” Hermione says.

“Detailed real-time visibility and track and traceability for health authorities will be required to ensure the optimal rollout of the vaccine across the population. A fully integrated supply chain will help to minimise any loss or wastage, to maintain the ability to undertake recalls or notifications where any issues with the quality of particular batches may be discovered,” Microlistics’ Archival says.

Equally critical is the ability to ensure that every step of the cold chain transportation process can be tracked so that data is fed back on stability of storage during the journey of the vaccine. “Sensors that provide the data at the cargo-level will help immensely in ensuring the integrity is not compromised,” DHL’s Leonara says.

All these issues coupled with the highest ever demand the pharmaceutical industry has faced will cause a very complex situation. “This is very different to SARS, MERS or Ebola. This is a pandemic and every single person needs to be vaccinated. This level of demand is something the pharmaceutical industry will never have experienced before,” Hermione says.

INTEGRITY AND SECURITY

A COORDINATED EFFORT FOR HUMANITY

Issues around authenticity, security, track and trace now play a significant role in the supply chain and a COVID-19 vaccine will accelerate these priorities.

“Pharmaceutical supply chains are some of the most secure and advanced in

The worldwide delivery of a vaccine will require a strong policy lead and industry will need to collaborate across sectors and borders. “This will require an in-depth plan between government and the logistics industry. The value of these

28 | MHD SEPTEMBER 2020

vaccines, and not just the dollar value but what they will mean for society and the economy, will require a coordinated effort,” C.H. Robinson’s Andrew says.

A lot of work will need to be done determining the policy of who receives the vaccine first and how to create the most efficient way of distributing it to all, Hermione says.

“Target populations are likely to include at-risk population groups such as the elderly or those with underlying health conditions and essential workers such as healthcare practitioners, food, transport and logistics workers,” Archival says.

Global logistics giant DHL is actively working with manufacturers, governments and NGOs in this context already. “There are several opportunities for collaboration around charters or humanitarian flights, especially to access countries that may be in lockdown, product import approvals, green lane customs clearance or coordination to deliver into remote areas,” Leonara says.

Prime Minister Scott Morrison has said “whoever finds this vaccine, must share it” and he consequently pledged that if Australia finds it, it will be shared.

The distribution of a COVID-19 vaccine is a similar moral endeavour and one that the supply chain will play a huge role in. “This is so much bigger than one logistics provider, it’s about everyone working together to ensure that every single person gets access to this critical vaccine,” Andrew concludes. ■

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MHD MATERIALS HANDLING

FROM MILLIMETRES TO MILLIONS Jean-Michel Maclou, Intralogistics and Transport Sales Manager at SICK reveals how carrier companies can recover lost revenue with accurate measurements.

M

easurement accuracy – whether it’s volume, weight or quantity – is vital in all industries to ensure an efficient production process and determine the true cost of a product’s value. It’s estimated that, each year, over $400 billion worth of goods are sold on the basis of a measurement in Australia.

Measurement inaccuracies are worryingly commonplace in the Australian transport and logistics industry. The transport and logistics industry is worth more than $150 billion to the Australian economy representing in excess of 14 per cent GDP. The costs involved in the shipping and delivery of goods is entirely dependent on measurements; inaccuracies can severely affect companies’ profits.

THE IMPORTANCE OF A MEASUREMENT Incorrect measurements may not make a huge difference on a case by case basis; but consider these inaccuracies when multiplied by the number of parcels distribution centres process in an hour, a month or a year. For example, one of Australia Post’s large parcel sorting machines can process over 12,000 parcels every hour.

Recording the correct measurements of parcels is not only important in regards to billing and invoicing; it also determines whether the allocated parcels can fit on the delivery vehicle and how much this will cost the distributor. The option of weight or size is important as road and air transport costs depend on the space occupied; i.e. the number of packages that can be carried, as well as their weight.

Knowing the exact measurements allow carrier companies to optimise their loads and, in turn, reduce costs.

Measurement accuracy is regulated

by The National Measurement Institute (NMI), Australia’s peak measurement organisation. The NMI is responsible for maintaining the nation’s primary standards of measurement and for providing the legal and technical framework for the dissemination of those standards across varying industries.

For each and every transaction made, the NMI’s trade measurement is there to ensure ‘you get what you pay for’ – meaning no loss in revenue or cost.

The NMI enforces its standards with regular checks and fines across all trade industries; in the past 12 months, they have recorded more than 1,000 complaints, issued 2,388 organisations with non-compliance notices and completed more than 40,000 tests for measurement and labelling accuracy.

Large parcel sorting machines can process over 12,000 parcels every hour.

30 | MHD SEPTEMBER 2020

COSTLY INACCURACIES According to Jean-Michel Maclou, Intralogistics and Transport Sales

Manager at SICK, “Carrier companies lose hundreds of thousands in revenue due to inaccurate measurements of packages,” he says. This doesn’t take into consideration the larger of these companies who churn through 1000s of packages per hour.

UPS’s air hub in Philadelphia, Pennsylvania, USA sees approximately 95,000 parcels and documents sorted every hour, day after day – when you consider these figures, it’s clear that the accumulative lost revenue can quickly become astronomical.

How can postal and delivery companies combat this flaw in their system?

SOLUTION SICK’s Dimensioning, Weighing and Scanning systems (DWS VMS 420/520) aid revenue recovery, capture data for automated generation of transport documents and provide accurate measurements for load optimisation.

The SICK DWS system automatically enable an accurate price to be charged, based on either the weight or the volume, whichever is greater. Clients who purchase a weighing system generally reduce revenue loss by $250,000 within just 12 months, with some paying back in half the anticipated time – just through recovered revenue.

Gary Bartoletti, Technical Director at Norsk-European, claims that SICK’s DWS systems have played a key role in the company’s operations. “Previously we had to rely on customer-declared weights and dimensions to calculate charges which, unfortunately, were not always accurate. Since the installation of SICK’s DWS systems, we have been able to capture correct weights and dimensions, and charge accordingly.”

Rapid revenue recovery can benefit all sizes of parcel and package carriers, from the smaller operations to those handling many thousands per hour, making the DWS an essential purchase. ■

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MHD MATERIALS HANDLING

AWH has implemented the Combilift straddle carrier at its Rocklea site in Queensland.

WRAPPED UP IN COTTON WOOL MHD sits down for a yarn with Australia’s largest wool handing company to find out more about the machinery that’s managing the movement of the nation’s wool and cotton industry.

F

rom the infamous Australian Ugg boot to an alternative thermal packaging for food and pharmaceutical products, Australian wool is regarded as among the world’s best.

The nation is one of the world’s largest wool producers, producing around 25 per cent of greasy wool sold on the world market. The Australian Wool Production Forecasting Committee expects the 2020–21 shorn wool production would be 276 million kilograms greasy.

The natural fibre in wool is highly 32 | MHD SEPTEMBER 2020

sought after for garments, due to wool’s unique odour resistant properties. However, before it’s turned into a woolly good, the thousands of kilograms of product require efficient supply chain management and storage solutions.

AWH is now Australia’s largest wool and independent cotton handler as well as being one of Australia’s leading general warehouse and specialist logistics providers. AWH is co-owned by the international stevedore and global logistics company DP World Australia and the World’s largest

agri-business company Nutrien Ag Solutions.

In various incarnations, AWH has been at the core of the Australian Wool supply chain for over twenty years. Rod Mackenzie and Tony Crebbin have the collective experience of over fifty years in their respective cotton and wool industries with AWH. Although Rod and Tony work on sites at opposite ends of the nation, they both say that machinery from specialist handling manufacturer Combilift has been as essential as the cotton and wool product itself.

MHD MATERIALS HANDLING COTTON FOOTPRINT Tony Crebbin, AWH Northern Eastern Operations Manager, says 170,000 bales of cotton have been received for export from its warehouse in Rocklea, Queensland this year. The warehouse gathers cotton from Northern New South Wales and Queensland, then sorts and stores it ready to be shipped overseas to be most commonly manufactured into apparel and clothing items.

“We’ve had some huge years with the cotton supply chain in my 35 years of being part of the business. Up to 300,000 bales have been through the site at Rocklea,” Tony says. He began on the floor of the warehouse and worked his way up the ranks to his current position of Region Operations Manager.

He highlights the implementation of a Combilift straddle carrier (CombiSC3) at the Rocklea site as a milestone for the company. The Combilift-SC3 (Remote Control/SC3T/RC) has a capacity to handle 35,000kg to over 100,000kgs. “A huge advantage was installing a complete unit that operates without fault every day,” Tony says.

Just over a year ago, all containers that arrived at AWH’s Rocklea site came on a side loader. “We used to be tied down to operating around container arrival times,” Tony explains. Since installing

the Combi-SC, he says the site now has ultimate flexibility. “A container can just come in and we can pick it up in one lift with the Combi-SC and place it where it needs to go immediately.

That is a huge cost-saving measure as we were previously loading outside the warehouse. Just imagine a 90,000 sqm warehouse and the distance you’ll be running with a forklift!” he says.

The Combilift arrived from Ireland in several shipping containers requiring assembling on the Rocklea site. Tony says the installation of the Combi-SC happened on-site in just three weeks. “We worked with Combilift to have a specially designed straddle carrier for our shed as it is quite low due to our location that backs onto Brisbane Airport,” he says.

Once the height approval was confirmed, the construction began to take place. Tony says the first stage was lifting and assembling the frames and main body, followed by the running of the cabling, lifting chains, electrics, and lights. “All checks of electrical components and final cabling checks were complete within the installation period. The next stage was to move to operational testing through trials,” Tony says.

“Since it was built it’s been essential

equipment for us. We are much happier than we’ve been before.” He notes one of the biggest differences to operation since installing the Combi-SC3 is the straightforward ease of the machinery.

“The training has been hassle-free.

Our drivers have appreciated the easy process unloading containers with Combi-SC and especially the air-con during Queensland’s sweltering heat,” Tony says.

Since installation, Combilift has also added a brace to the Combi-SC3 to further assist AWH Rocklea, who also handle heavy duty escalator parts as well as cotton bales to enhance versatility. “That means we’re not having to hire a crane but can move containers and parts around independently whenever it suits us, which is not only a cost-saving measure for us but our clients too.”

“We are now confident that our business has the reliable equipment to service our customers’ requirements as efficiently as possible,” Tony says.

He predicts Australia will be looking at a stronger cotton season this year due to the rain in Queensland and credits the Combi-SC3 as a useful tool to aid business development and enhance Australia’s wool and manufacturing market.

AWH installed three Combilift Aisle Masters at its site in Victoria.

MHD SEPTEMBER 2020 | 33

MHD MATERIALS HANDLING

AWH has been at the core of Australia’s wool supply chain for more than 20 years.

HANDLING NATIONAL WOOL CLIP Rod Mackenzie, AWH Lara Site Manager, says the company’s Victorian site in Lara deals principally in wool as well as some dry bulk across its four sheds that stretch over 120,000 sqm.

Rod explains that there are two peak shearing seasons. One from mid-August to December known as spring shearing, which is followed by autumn shearing from late February to end of April. “Traditionally with bales of wool, an operation can only stack four high from the floor. So, we had a vision to install racking to go higher and make best possible use of our shed space,” he says.

AWH installed three Combilift Aisle Master articulated forklifts at the Lara site, just over five years ago. Rod labels the machinery installation as a game-changer for facilitating and managing the movement and sale of the national wool clip annually.

“Our sheds have narrow alleyways and rely on height to stack more than 4 bales of wool on the floor. We have around 600,000 sqm of racking in place now that stand 11 meters tall at the peak of the shed. Now we can store roughly 24,000 bales of wool, whereas traditionally on the floor it could only hold around 19,000 bales,” he says.

34 | MHD SEPTEMBER 2020

“

We’ve increased volume by 5000 bales. Before, we had to lose a lot of wool by digging it out and replacing bales. But with the racking, wool movement is minimised in the warehouse without double work.

”

Rod says storage capacity has never been more important, as due to current supply chain challenges, less wool is being exported to key international markets. The result is a requirement for more interim storage capacity, which the company has been able to achieve in its sheds thanks to the Aisle Masters’ ability to optimise space.

“We’ve increased volume by 5000 bales.

Before, we had to lose a lot of wool by digging it out and replacing bales. But with the racking, wool movement is minimised in the warehouse without double work,” Rod says. The Lara site can comfortably hold wool until an auction takes place and when the buyer is ready to export, AWH utilise the gas operated Aisle Master articulated forklifts to help clients with their storage and movement requirements as efficiently as possible.

“Wool comes in at all different sizes and weights so having racking with a versatile machine ensures safe handling of bales whilst also maximising storage space,” Rod says. “The Aisle Masters themselves are comfortable for our drivers navigating narrow aisles and perform to a high standard thanks to their reliable operation and minimal maintenance levels that keep costs down.” ■

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MHD TECHNOLOGY

AUTOMATING AUSTRALIAN MADE Diverseco shares how its appointment as Official Mobile Industrial Robots Partner will leverage Australia’s manufacturing productivity through today’s factory floor demands.

T

he supply chain crisis we are currently experiencing has highlighted the lack of manufacturing that is in Australia.

Re-shoring products back in the nation has been a vital point of recovery, however the cost of labour is still an issue. Keeping the cost of

manufacturers to be competitive during this time,” Peter Hern, Business Development Manager Automation at Diverseco says.

Robots have been prevalent in the automotive industry for almost 60 years now, but the use of autonomous mobile robots (AMRs) is still relatively

currently working with a snack food manufacturer with multiple locations for its pallets of pre-packaged products. “Instead of hazardous forklifts, we’ve set up a system so the AMRs can pick the pallets from the finished line and deliver them to their required destination based

manufacturing down whilst limiting human-to-human interaction is a spiking trend across Australian factory floors.

“Automation is able to improve productivity of our local manufacturers, without increasing their head count and that’s what the Australian supply chain is looking for.

Automation is also allowing Australian

new. “AMRs are very consistent in what they deliver, they don’t need a forklift or even people on the factory or distribution centre floor,” he says.

Peter says having a fleet of AMRs in a factory facility can assure assemblies, raw material or even finished product is moved where it needed to be without a lot of human intervention. Diverseco is

on a barcode in a safe and highly efficient manner,” he says.

EVOLVING INDUSTRY THROUGH PARTNERSHIP In July, Diverseco announced the new addition of Mobile Industrial Robots (MiR) to its growing portfolio of industry-leading automation and robotics systems. Peter says the

AMRs can move around obstacles independently, are easy to set up and don’t require fixed routes.

36 | MHD SEPTEMBER 2020

MHD TECHNOLOGY

It’s very easy for an AMR to support and adapt to an operation. company now has Konica Minolta and MiR as robotic partners that will be a pivotal success to various Australian industries.

MiR plays an important role in the evolving industry, logistics, and manufacturing sectors by adding highly reliable, robust, and safe collaborative autonomous mobile robots to organisations looking to improve their overall efficiencies through automation. “MiR is a Danish company that comes from a region that is extremely well known for its robotics. Diverseco is now the Integration Partner for MiR, supporting the local distributor, Konica Minolta. Our engineering capabilities and pool of resources alongside our partners, will ensure customers get maximum return on their investment in automation,” he says.

Peter says the MiR range caters for a capacity up to 1000kgs loadings that is most suitable to a large proportion of pallets that we see in manufacturing across Australia. These robots are now used by manufacturers in a wide range of industries and healthcare

sectors to automate their in-house transportation. “For customers it’s all about having flexibility.

Customers can change the location of where items need to go and add new locations without the need for costly reprogramming,” Peter says.

AUTOMOTIVE TO MOVE AUSTRALIA Unlike automated guided robots (AGVs), autonomous mobile robots can move around obstacles independently, are easy to set up and don’t require fixed routes. Peter says this makes them safer, smarter and more flexible than AGVs. “AGVs have served industries well for the past 30 years, but the path they follow is strictly determined by tracks on the ground of the warehouse. In today’s current climate with the logistics industry expanding at an unprecedented rate, thanks to increasing expectations from e-commerce consumers, flexibility is the future,” he says.

To mitigate the labour shortage logistics companies, have no choice but to boost productivity of the existing workforce by investing in

more autonomous technology, like AMRs. And while large internationals within FMCG such as P&G, CocaCola & Unilever have seen success from their automation practices, businesses must keep innovating in order to compete better.

“The MiR has very good capabilities with APIs to be able to directly integrate with a current warehouse management solution.

The flow of the product on the production line and where it needs to go in the warehouse is transmitted during real-time, which is controlled wirelessly with the MiR units,” Peter says.

For companies and manufacturers who are changing their processes on a daily basis, it’s very easy for AMR units to support and adapt to its operation, especially during a time of major uncertainty. “Our partnership has expanded our knowledge, skills and experience in supply chain, and we’ve got the ability to cover many different layers within an operation, right from product manufacturing to the logistics and everything else in between,” Peter says. ■ MHD SEPTEMBER 2020 | 37

MHD TECHNOLOGY

A NEW CONCEPT In July this year, Breville recorded its biggest month ever. Concept Logistics tells MHD how it standardised its operation with Microlistics WMS, enabling it to be an innovative 3PL provider to Breville and other leading household names.

C

onfined to their homes during recent lockdown restrictions, many Australians turned to baking as the number one way to pass time. Social media has been flooded with photos of “isolation loaves” and “quarantine cookies” and, prominent home appliance company, Breville has experienced record sales of its products; specifically blenders, coffee machines, toasters, kettles, microwaves and toaster ovens, to Aussie home chefs.

In July, Breville enjoyed its largest month on record with stock output up an impressive 100 per cent on the previous year. As part of its tailormade solution for Breville, Concept Logistics utilised the Microlistics Warehouse Management System (WMS), enabling it to double Breville’s output with only a 25 per cent increase in manual labour.

Phil Crowe, Concept Logistics’ Operations Manager - ANZ, was instrumental in establishing the Concept Logistics site at Minto, in 2017, to specifically accommodate Breville appliances. Phil is pleased to report, “Since then, we’ve continually met Breville’s requirements and have been flexible to seasonal demands and significant volume increases due to extenuating circumstances; such as Covid. This was in no small way possible due to the benefits of the Microlistics WMS.” 38 | MHD SEPTEMBER 2020

Concept Logistics is privately owned and operated and currently manages five 3PL locations; Victoria, two in New South Wales, one in Queensland and one in Western Australia. All sites are well serviced by Concept Logistics Interstate Transport. Concept Logistics provides distribution and warehousing and fulfilment services to some of Australia’s most loved brands; including Fletcher building products and McPherson’s personal care consumables.

BIG WIN FOR CONCEPT LOGISTICS “We pride ourselves on independence.

We know all our customers personally and one of our biggest achievements is retaining big brands.

Our strength is in being able to

In July, Concept Logitics’ customer Breville reported its largest month on record.

perfectly match our 3PL formulas to these leading companies’ varied requirements,” Phil says.

Phil reflected on the days when Concept Logistics was held back by its previous WMS. “E Commerce was taking off and the system didn’t allow for picking modules. This limited our ability to take on new clients.

As clients became more sophisticated, we knew that we needed to keep up with modern picking and packing methodology. Microlistics has enabled Concept Logistics to meet all the requirements of our existing client-base and we’re confident that it will see us into the future.”

In 2015, Concept Logistics knew it needed to replace its WMS with a system that would aid it to fulfil its market strategies and be flexible to

MHD TECHNOLOGY demand, without a hefty price tag.

When reviewing WMS providers, Concept Logistics focused on finding a like-minded provider that understood the Concept Logistics “Customer First” philosophy.

According to Phil, “Microlistics suited us best. The hands-on Microlistics team stood out from the rest, proposing a bespoke solution that would support stock control and our specific 3PL management style”.

Once Microlistics was agreed upon as the best WMS provider in the market, Concept Logistics had to transition to the platform while maintaining optimum service levels.

In 2017, it began with its Laverton North site in Victoria. Once fully satisfied that Microlistics was the right fit, in 2018 Concept Logistics really put it to the test as it went live with a new customer, new warehouse and the still relatively new Microlistics application. According to Phil, “This could have been a 3PL nightmare, but the transition went flawlessly; smooth and problem-free and this was in no small way due to the Microlistics aspect of the set-up.

Now all five national sites utilise the one Microlistics WMS”.

“

We pride ourselves on independence.

We know all our customers personally and one of our biggest achievements is retaining big brands.

Our strength is in being able to perfectly match our 3PL formulas to these leading companies’ varied requirements.

”

KEEPING IT FLEXIBLE “Our work is generally contract-based for a considerable number of years. After a brief period of customisation, scalability is vital to enable us to rapidly expand to absorb new work and the reverse in times of downturn,” Phil said.

In short, Phil credits the Microlistics WMS framework for assisting Concept Logistics to develop its customised receiving, storage and Pick and Pack (PnP) processes within the Microlistics environment; enabling Concept Logistics to adapt its service around each client’s profile. “The Microlistics system has helped our company’s operation with essential stock control across many customers and sites,” he says.

Concept Logistics’ PnP versatility has aided customers; including blue-chip customer Breville, during sales surges and supply chain challenges, such as those experienced throughout the recent pandemic. Phil proudly stated, “Our B2C has increased more than two-fold. Our clients, with online channels, have experienced significant growth and the adaptable WMS has allowed us to continually optimise and improve our operation to suit current and future markets.” ■

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MHD MATERIALS HANDLING

A JUICY PROPOSITION FOR FAMILY BUSINESS A third-generation family run fruit-juice business has had Toyota forklifts at its core since its inception 55 years ago.

East Coast Beverages bought its first Toyota forklift at the business’ foundation.

E

ast Coast Beverages, based in Kulnura on New South Wales’ Central Coast, is a grower, manufacturer and purveyor of fruit, freshly made premium fruit juices and natural spring water.

One of the last family owned juice enterprises and employing more than 25 local staff and a large host of family members, East Coast Beverages bought its first Toyota forklift at the business’ foundation.

East Coast Beverages Sydney Markets manager, Sam Lentini, said that family has been at the heart of the business’ success and continues to be so, today.

So too has been its clever production systems, central to which is a fleet of 15 Toyota forklifts.

Sam explains that the family name originates from the Italian island of Sicily where Sam is a citrus-growing region that goes back centuries, which is why after emigrating to Australia 40 | MHD SEPTEMBER 2020

his grandfather, Salvatore, bought fertile land blessed with natural spring drinking water in Kulnura and planted his first orchards in 1965.

Thirty-six years later, he purchased his first Toyota forklift.

Sam says after the orchards yielded fruit his great grandfather picked and packed it to sell at Sydney Markets.

His three sons joined the business and purchased another property close by to plant more citrus.

“They were still doing Haymarket and then they started doing Sydney Markets at Homebush,” he says “They were selling their citrus at stands, there.

They were also supplying juice factories around Sydney with oranges. But then once the government allowed the importation of concentrated fruit juice, there was nowhere to sell their fruit.

They had all this fruit, so they decided to start squeezing their own. That’s how East Coast Beverages came along.”

“As business has grown there’s been an increase in our fleet size. We started off with just the one Toyota forklift and now we have 15 in total and use Toyotas exclusively. It’s a bit of a mixture of gas, diesel and electric.

“We used the diesel fork at the Sydney Markets before replacing it and the battery forks are used in the cool rooms because they’re confined spaces and you can’t have fumes in there. Only gas and battery are allowed to be driven in the factory. We now have the old diesel fork down at our farm shed. It was one of the original batch which was working in the main business until this year when we purchased a new replacement for it - a new Toyota 8FBE18 electric threewheeler that is a lot easier to use in the cool rooms because they have a much

better turning circle.

“The old fork is still going after 19 years, which is quite remarkable and shows how durable Toyotas are. We’ve sure gotten our value out of it.”

East Coast Beverages modified some of its forklifts to suit refrigerated environments. “We had them put lower frames that don’t hit the cool room roofs,” he said. “We also customised the paint job on the latest threewheeler in the company’s colours.

TMHA Area Sales Manager, Michael Tsougranis, says that Toyota’s famed reputation for longevity is one of the key facets of the Toyota Advantage: “We call it QDR which is short for quality, durability and reliability,” he says. “Toyota has a highly refined production control system that stops production immediately when a problem occurs, thus preventing defects and producing high-quality machines.

“When you buy one of our forklifts you know it’s not going to let you down,” he said.

Sam says East Coast Beverages’ forklift fleet gets a pretty hard life. “As far as duties go, we’re making orders in the cool rooms, loading and unloading trucks, putting fruit away into racking.

So, the forklifts get used a lot; the new ones about 18/19 hours-a-day. They get worked hard.”

This points even further to the remarkable longevity of the business’ fleet. “The Toyota forklifts’ durability has been proven through our long experience in the business. It’s a key reason we keep buying them. They’re reliable. They’re also a favoured forklift at the market, in general.”

Sam also personally enjoys operating his forklifts “I still drive them at the market, and I think they’re great, a very

MHD MATERIALS HANDLING good forklift. Our operators also like using them. They say that they’re one of the best and easiest forklifts to drive.”

Another key feature of the Toyota Advantage is its exclusive System of Active Stability (SAS). TMHA’s Michael Tsougranis explained that SAS is the first system in the world to monitor and control their forklifts through a combination of advanced sensors linked to an on-board controller, enabling assured load-handling performance and, therefore, safety.

“The SAS computer constantly analyses the potential for a tip-over.

If the SAS computer finds tip-over potential, it sends a signal to the Toyota forklift actuators, which then minimise tip-over potential,” Michael says.

“The SAS safety measures are based on the fact that the stability of a forklift changes constantly due to shifts in the balance of the load, coupled with the speed and turning-rate of the forklift.”

East Coast Beverages’ Sam agrees that the SAS system is another reason the business’ forklift fleet is exclusively Toyota. “For safety they’re really good.

As East Coast Beverages has grown in size, so has its fleet.

You have to be so careful and Toyota forklifts have the safety features, like stability control, that we want for our employees, and for our family.”

He is just as pleased with his support from TMHA as with the forklifts, themselves: “The Toyota reps are really

good. We used them for the servicing and any time we need them, they come straight out and get the job done.” ■ For more information freecall 1800 425 438 or visit www.toyotamaterialhandling.com.au

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MHD TECHNOLOGY

SmartFreight bridges the gap between the supply chain and the consumer experience.

SMARTFREIGHT OFFERS THE KEY TO CUSTOMER SATISFACTION As the world’s consumers shift online at a rapid rate, a bad customer experience and limited shipping options are contributing to customers abandoning their purchase at the last hurdle. An Australian software company is helping solve this issue for retailers worldwide.

C

art abandonment is an e-commerce term used to describe when a consumer adds a product to their shopping cart but fails to follow through with the purchase.

With window shopping at the world’s largest retailers available from the comfort of our homes, it makes sense that consumers would be a little indecisive about committing to a purchase. However, recent data

by Statista found that upwards of 88 per cent of online shopping orders were abandoned.

Unexpected or unclear shipping costs, limited delivery options, a poor returns policy and a complicated check out process can lead to cart abandonment.

An Australia-based software organisation is simplifying this process for thousands of e-commerce retailers around the world by bridging the crucial gap between supply chain operations 42 | MHD SEPTEMBER 2020

and the customer experience.

SmartFreight was founded in 1997 by Neil Page, Director and Ken Aitken, Global MD with the aim of changing things for the better. “Neil and Ken were early believers in using disruptive technology to improve the customer experience and created one of Australia’s first generic multi-carrier shipping systems,” James Kinniburgh, National Partnership Manager at SmartFreight says.

Quickly establishing itself as a market leader, SmartFreight now ships more than 50 million items per year across 195 countries, boasting more than 16,000 users and working with upwards of 650 transport carriers worldwide.

In 2018, ASX-listed [WTC] company WiseTech Global acquired SmartFreight. Crucial to WiseTech’s global expansion strategy was the need to enhance and increase its last

mile for logistics capabilities, which is where SmartFreight comes in.

VISIBILITY ABOVE ALL THINGS Operating in Australia, New Zealand, Ireland, Britain and South Africa, SmartFreight provides visibility for the shipper and the customer. “We know visibility is the most important thing to our customers. Everyone wants to know where their toys are – whether they are in a warehouse, in a truck, or in a cage – you need to know where they are at any given time,” James says.

This visibility then feeds into the customer experience, which SmartFreight has recognised as absolutely critical in e-commerce capabilities.

“With the SmartFreight solution, after that sticker goes on the parcel, you don’t need to be involved. The customer should have full visibility and

MHD TECHNOLOGY there should be constant streams of communication via real-time tracking.

With SmartFreight, customers don’t need to call the customer service lines as they will know via text, email and smartphone where their parcel is and when to expect it,” James says.

This level of service is critical in e-commerce. According to James, the online shopper is fickle. “You can lose a client very quickly in the e-commerce world. So, you need to offer a seamless customer experience,” he says.

For SmartFreight and its customers, that means offering the most harmonious experience possible. “For the consumer it should be simple. Do they want it fast and pay extra, or do they want standard shipping? But for the retailer, there can be so many cost and efficiency benefits sitting behind this simple interface,” James says.

But many retailers still operate with a single carrier system, for those who do they are missing out. “You can’t cross compare; you can’t run reports. If you use a smart system, you can use freight profiles whereby you can set criteria to select certain carriers depending on the suburb, postcode or state.”

THINKING SMARTER: REMOVING MANUAL STEPS With e-commerce penetration reaching record highs during COVID19, many retailers have struggled to keep up with demand.

“If you are doing this process manually, you might have to run to the warehouse to pick the product, then

With the SmartFreight solution, orders can come across in under one second, and a label printed in two seconds.

Many retailers still operate with a single carrier system and are missing out on data, performance and enhancing the customer experience. go to the PC and type the address in, input the weight and volume, print a label, put it on the box, write down the details, input the details into the WMS and then manually send an email to the customer,” James explains.

If this is done 50 times a day, that’s an entire day gone and only 50 orders out the door. With many retailers experiencing increased volumes across e-commerce during COVID19, it’s impossible to get ahead with manual processes.

“With SmartFreight, orders can come across in under one second, with label printing in two seconds

and the data back in the WMS in four seconds,” James says.

SmartFreight integrates with more than 220 of the leading global, ERP, WMS and Ecommerce platforms. “We’re all about seamless integration. We work with all leading ERP and WMS providers and also integrate with the retailer’s website,” James says.

James refers to SmartFreight’s customer Pandora, a leading jewellery retailer, as an example. “If you order from Pandora, it doesn’t matter if your goods are shipped to you via Carrier 1, Transport Provider X or Carrier Z, the customer will continue to see the Pandora interface they are familiar with, even though it’s SmartFreight powering the shipping experience,” James says.

With a number of business awards under its belt, SmartFreight has been recognised as an industry leader in technology and innovation and prides itself on being flexible.

“As Software as a Service (SaaS) shipping software, we have a one size fits all approach. Whether you’re a small start-up, or a global retailer, we can tailor a solution that fits your needs,” James says.

Whether price, volume, service or environmental impact are at the top of the shipping priority list, SmartFreight can find a quick and flexible solution so that the customer experience is the best it can be. ■ MHD SEPTEMBER 2020 | 43

MHD SUPPLY CHAIN

MICRO-FULFILMENT OFFERS MEGA BENEFITS Consumer expectations around convenience are rising, causing more e-commerce retailers to rethink their logistics strategies. MHD sits down with the Körber Supply Chain APAC team to answer the most pressing questions around micro-fulfilment.

A

s the number of online shops continue to grow, so does the competition. While the pandemic may have accelerated the need for retailers to enhance and develop their online capabilities, a better and faster online experience was already crucial to retail success.

“Sitting on the fence is no longer an option. Businesses need to invest in fast and efficient fulfilment solutions now and dive right in and start reaping the benefits of low-cost and scalable fulfilment technologies on offer.

These solutions prove the case for businesses to make quick decisions,” Rizan Mawzoon, part of Körber Supply Chain’s sales team says.

Aggressive investment in infrastructure by retail giants such as Amazon has shifted consumer demands from three to four-day delivery window to next day or even same-day delivery expectation.

One strategy that is starting to be utilised in Australia is micro-fulfilment.

Also at times referred to as dark stores, hubs or sorter DCs, microfulfilment refers to small-scale warehouse facilities in accessible urban locations. The strategic

Micro-fulfilment is sometimes referred to as a dark store, hub or sorter DC.

44 | MHD SEPTEMBER 2020

Körber is already working on a number of pre-built or purpose-built microfulfilment centres in the APAC region.

advantage is the same, high speed order fulfilment and close proximity to the end customer or their transport routes.

Some micro-fulfilment centres are purpose-built centres, but there is also the opportunity to occupy existing space such as car parks, stockrooms, office buildings or shopping centres.

This is also happening in the US, with Amazon reported to be in talks with the largest mall operator in the country to repurpose sites into micro-fulfilment centres.

Closer to home, Körber is already working on a number of pre-built or purpose-built micro-fulfilment centres in the APAC region. “We’ve been looking at table-top or on-the-ground sortation using AMRs. We see that these type of requirements and expectations will be commonplace in the future,” Rizan says.

While many preconceptions regard this endeavour as a long and complex task, the Körber Supply Chain team has been developing capabilities in this field for some time. “We realised very early on that we had to have our team and

response rate on point so that we can have a micro-fulfilment centre ready with perfectly designed operational workflows in a matter of weeks or days,” Tim Baracz, part of Körber Supply Chain’s sales team says.

For Nishan Wijemanne, Managing Director at Körber Supply Chain APAC and global leader for AMR Solutions at Körber, local and mid-tier businesses have the opportunity to get ahead and compete with the likes of Amazon.

“We’re giving our clients a 24 monthhead start on Amazon penetrating the Australian retail market on a larger scale.

We’ve been offering this kind of flexible and agile supply chain fulfilment for the last three years and we know how to make next-day and same day delivery a reality,” he says.

Micro-fulfilment offers what Nishan says is a sweet spot for many retailers and e-tailers. “The flexibility, agility and low barrier to entry, coupled with compelling throughput increase rates of 400 per cent plus, is a very compelling case for this kind of approach,” he says. ■

MHD SUPPLY CHAIN

THE FIVE OPTIONS FOR MICRO-FULFILMENT

BY RAVI NATH AND SAMIR RAFIQ, PART OF KÖRBER SUPPLY CHAIN’S AMR SOLUTIONS TEAM.

1 2 3 4 5

FULFIL IN EXISTING ENVIRONMENT

This is micro-fulfilment in its simplest form. Many grocery retailers are utilising this approach.

They are utilising staff to move around the store with pick carts using mobile devices.

While this is relatively easy to set up and doesn’t require much dedicated space, it requires staff to move in and out of aisles pushing carts around and causing congestion in a store that is also used by customers.

If a retailer is experiencing a demand in increase, they need to rely on additional staff to fulfil orders and many retail staff are not able to help customers instore.

USE DEDICATED SPACE

This approach allows picking staff to be separated from retail floor space, where clients are shopping.

Allowing for a greater flow of traffic and also offers some ability to adapt to growing demand.

However, there are challenges with regard to holding all inventory in this space, so retailers may need to place their high velocity SKUs in this space and may need to pick from the retail floor space to handle remaining SKUs. This has limitations when it comes to growing online demand.

FLEXIBLE GOODS-TO-PERSON

Using a dedicated space while utilising a higher density storage capacity with Automated Mobile Robots (AMR). Goods-to-Person technology allows for increased flexibility and allows a much higher volume of inventory in a smaller footprint compared to manual picking shelving.

This model also offers a much higher throughput level, with many designs offering approximately 500 picks per hour with only two operators.

There is also the added value of being able to scale up and add more workstations or storage space to cater for growing online demand.

This kind of mobile automation is very quick to implement and can often be done in a matter of weeks, compared to the long lead times of traditional fixed automation.

ORDER-TO-PERSON

Introduce Assisted Picking AMR technology through Order-to-Person. Orders are grouped and sent on robots to the closest operator-managed zone and are presented. They then continue to the next pick location in that zone.

This is easy to implement into an existing retail footprint. It provides the capability to increase efficiency and fulfil growing online demand.

However, this can be difficult to balance the retail floor with the growing demand so that congestion is avoided. Specific aisle widths are needed to ensure that operators can pass with adequate clearances.

HYBRID MODEL – GOODS-TO-PERSON AND ORDER-TO-PERSON

This solution offers ultimate flexibility. Dedicated space is limited allowing higher velocity products to be stored and fulfilled with an AMR Goods-to-Person solution, offering a high throughput. This is then coupled with AMR Order-to-Person solution to travel the existing retail floor space for the remainder of the pick.

MHD SEPTEMBER 2020 | 45

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MHD SUPPLY CHAIN

IN THE PEOPLE BUSINESS

At the centre of every business is its people. Staff Australia has been providing Australia’s major blue-chip logistics and manufacturing companies with a dedicated and high calibre workforce for more than 20 years. MHD finds out more.

I

n a fast-paced environment like logistics and warehousing, businesses rely on being able to get the right person into any given role at the right time. Meeting fluctuating spikes in demand is challenging and often requires the need to be able to access an agile and flexible workforce.

Working with a recruitment partner who understands these challenges and is able to deliver a committed and superior service to both clients and candidates can be the difference in meeting service level agreements and customer expectations or losing out on business.

Staff Australia is a specialist recruitment agency with offices in

Australia and New Zealand. At the core of its business is servicing the logistics and warehousing and manufacturing industries with a quality workforce.

Having worked with the industry for more than 20 years, Staff Australia’s team of experts understand what good recruitment practice looks like in the logistics and warehousing space.

“The founding partners of Staff Australia wanted to change recruitment practices in Australia. They saw there was an opportunity to change the way recruitment agencies interacted with their temporary and fulltime staff and offer a recruitment process that concentrates on understanding the

Staff Australia has been working with some of its clients for more than 15 years.

48 | MHD SEPTEMBER 2020

candidates needs as much as their skill set,” Shaun Foley, Director at Staff Australia says.

Having a more holistic approach helps solve issues which may occur down the track, Shaun says. “If you don’t understand a persons’ motivation, desires and full circumstance you are less likely to have a successful client match. An example may be placing a candidate on a site that requires overtime. Many casuals have to be home for childcaring, whilst their partner works an afternoon shift,” he says.

This approach and philosophy are at the core of what Staff Australia offer.

With a driving principle of respect for the candidate, Staff Australia is able to offer a far greater outcome for its clients and candidates.

“We have found that if we treat our candidates with the respect that they deserve and skill match them into the critical roles for our clients, we get a far greater outcome for everyone involved,” Shaun says.

Referring to Staff Australia’s high retention and attraction rates, Shaun says that Staff Australia has the motto of “making people our business”.

“Everyone at Staff Australia treats the people who work for us with the utmost respect and understanding, we pay them on time, we make sure that we

MHD SUPPLY CHAIN keep our end of the bargain” he says.

This has given Staff Australia the ability to attract the best talent and also to retain a higher level of candidate for a longer period of time, which is absolutely critical for any logistics provider.

“In the temporary labour market, the biggest challenge our clients face is the transient nature of the workforce. If they are not engaged, they will move on very quickly,” Shaun explains.

RETENTION IS THE KEY TO SUCCESS Retention of both internal and external temporary casuals has been the most critical success factor over the history of this proudly Australia-owned company.

“Our internal retention rates blow the recruitment industry standards out of the water,” Shaun says.

The benefit to our clients is that when they contact us, they know they will speak to someone who understands their business, its culture and which temp candidate will make the suitable match.

Staff Australia has been working with some of its clients for more than 15 years and according to Shaun this is very rare to see in the market.

If a logistics provider can retain, train and grow a candidate, then there are significant cost savings to be realised verses replacing and adding unnecessary costs to productivity.

Staff Australia partners with Australia’s major blue-chip logistics providers to provide roles from picking and packing staff, to forklift operators, to middle management and executive level supply chain roles.

“We also have worked with Greenfield sites and we have hired everyone from the Area Manager to the cleaner,” Shaun says.

Shaun says there has been a recent spike in demand for temporary labour in the workforce, a trend that was underway even before COVID-19 hit.

“Over the past 12 months we have seen an encouraging spike in requirement, the supply chain is constantly evolving and there is always a need to scale up and utilise a larger workforce,” Shaun says.

Many people working in logistics and supply chain have the ability to adapt and change depending on what sort of role is needed, having this skill is a great benefit to logistics providers whose demands and requirements may change.

Some of this increase in demand has come from the shift to online shopping, with many shops closed as COVID restrictions were rolled out across Australia, many retailers

“

Over the past 12 months we have seen an encouraging spike in requirement, the supply chain is constantly evolving and there is always a need to scale up and utilise a larger workforce.

”

have had to offer an enhanced online service.

“Over the past 24 months we have helped many of our clients meet rising demands in e-commerce. We mobilised quickly during COVID-19 and helped our clients fill critical roles when they had to refocus their operations,” Shaun says.

REDUCING THE BURDEN Shaun and the team at Staff Australia pride themselves on being able to remove the burden of the workforce from their clients.

Once a client tells Staff Australia what they need, they go out to market, screen and recruit the staff, bring them in for a thorough recruitment process and make sure they are job ready.

“It’s not the person we are providing. It’s the service behind that person. If 40 people are supposed to start on a Monday, then we want our clients to worry about the product they are moving, or manufacturing and we will worry about the people. It’s on us and we will deal with any issues,” Shaun says.

Speaking about the logistics market in general, Shaun says that it is one of the few industries in Australia where you can work your way up through the ranks.

“You can start in this industry as a semiskilled worker on the warehouse floor and over a period of time you can train and be recognised as a warehouse general manager,” he says.

Shaun proudly says that he now works with some clients who were candidates 15 years ago. “I know people who sit within very senior roles, in some of the biggest companies in Australia who were picking boxes 20 years ago. It’s fantastic to see.” ■

Many people working in the logistics industry have the ability to adapt and change depending on what role is needed.

MHD SEPTEMBER 2020 | 49

MHD SUPPLY CHAIN

E-commerce capability is the defining factor in creating winners and losers in the 2020 retail landscape.

A NEW NORMAL EMERGES

Almost every consumer good will have been transported by a third-party logistics provider at some point in its journey to the end customer. MHD catches up with Joe Couto, CEO at Körber Supply Chain APAC to find out where the challenges and opportunities lie for this crucial part of the logistics puzzle.

A

s we move further into corporate reporting season in Australia, the impact of COVID-19 on the country’s largest corporations is unravelling.

Over the past few weeks, the vast majority of share market listed companies have updated investors on their results for the past financial year, revealing the true cost of COVID-19.

Never before has the Australian business sector seen a reporting season like this, with a global health pandemic, the first recession in Australia in 29 years and an unprecedented level of government financial support to prop businesses up during the challenge of a lifetime.

However, it’s not all doom and gloom as some companies have navigated through the challenges of the pandemic and pivoted their business model to not only survive, but in some cases thrive.

Large traditional retails such as Bunnings, Officeworks, JB Hifi, Rebel Sport and grocery retailers such as Coles and Woolworths have seen a significant increase in sales.

50 | MHD SEPTEMBER 2020

Furthermore, online only retailers such as Catch and Kogan are expected to report record profits this season.

One thing these businesses have in common is their ability to service their online consumers. According to Joe Couto, CEO at Körber Supply Chain, e-commerce capability is the defining factor in creating winners and losers in the 2020 retail landscape.

“A good example coming out of the US this week would be Walmart, Target and Kohl’s. Walmart and Target are set to report an increase in sales, while Kohl’s is reporting a disappointing third quarter-earnings and has consequently slashed its full-year forecast,” Joe says.

The difference between Walmart and Target and Kohl’s is online and e-commerce capabilities. “Companies very quickly realised they needed to have an e-commerce strategy and for those who were forced to shut their bricks and mortar stores during COVID-19 and did not have an online strategy, they have really suffered,” Joe says.

This need and demand for online capabilities presents a huge opportunity

for the 3PL sector. “A 3PL can offer a retailer a very fast and effective way for them to pivot their business and to get up and running in online retail. It’s essentially fast-tracking the entire process and going from little confidence in the e-commerce to offering a highly capable back-end in picking and shipping orders and handling returns,” Joe says.

CHALLENGES FOR 3PLS The increased importance of shipping speed for these retailers to meet consumer demands presents both challenges and opportunities for thirdparty logistics providers.

For instance, 3PLs might experience growing volumes year over year, but contract terms tend to be short and vary widely.

Furthermore, 3PLs often rely on a temporary workforce which can be difficult to predict and forecast. With flexibility and cost control as priorities, there is an opportunity for 3PLs to leverage technology to better achieve their goals. This is also an opportunity

MHD SUPPLY CHAIN

Android Voice offers a userfriendly and scalable solution during peak and non-peak times.

to implement technology such as Andorid Voice. “This solution is both user-friendly and scalable during peak and non-peak times, so is a quick and convenient way to scale up and increase productivity,” Joe says.

“To fulfil the last leg of the retail supply chain and get shipments to buyers on time, 3PLs must become faster and more efficient, as well as adept problem solvers. Unfortunately, many 3PLs don’t have a lot of capital to invest in expensive supply chain management solutions. The good news is that the two most innovative strategies for increasing efficiency and addressing common industry pain points – voice technology and robotics – are affordable and can rapidly achieve a return on investment,” he says.

Some 3PL organisations are using automation and technology to deal with the challenging consumer demands.

“The productivity of Automated Mobile Robots is extremely high. Additionally, they are reliable and can work for 24 hours if needed,” Joe says.

Körber Supply Chain has had recent success with this solution in Australia, with leading 3PL providers CEVA Logistics and Bolloré Logistics implementing AMRs for e-commerce fulfilment. Boasting a productivity increase of up to 400 per cent, the AMRs have been a big win for these logistics providers and their retail customers.

Retail giants like Amazon have set the standard in terms of automation, and retailers now realise that they need to keep up with or get ahead of Amazon to compete.

For Joe, the answer to many challenges that 3PLs currently face is in flexible and agile technology solutions. “That could be software that sits on the cloud, robots on a monthly rental fee or scaleable voice picking technology,” he says.

Körber has been expanding its presence in this space, with the recent partnerships announced with Fetch Robotics and Locus Robotics to broaden its portfolio in cloud-based collaborative robot solutions.

Third-party logistics providers need to enhance their technology capabilities to meet demanding fulfilment times.

Scaling up and down is easy with flexible automation like AMRs. “As your business changes, you can move the robots from one destination to another. You might have robots in Melbourne, but then you experience a peak in demand in your Sydney distribution centre (DC). In this instance you can easily ship them to Sydney to meet the demand you have there,” Joe says.

The scope around AMR is constantly changing, unlike fixed conventional automation that is bolted to the ground, it is possible to move them from one destination to another which gives a 3PL a significant benefit to deal with fluctuations in demand.

THE POST-COVID WORLD As consumers changed their habits dramatically during COVID, some of these behavioural changes will stick and are here to stay.

“In March and April, the prepared food sector went up 80 to 90 per cent.

While this won’t stay at that level, it is expected to maintain around 50 per cent growth. This is huge and is a game-changer for the whole grocery supply chain,” Joe says.

For the 3PL providers servicing the grocery supply chain, there are many challenges around cost, speed and volume. “Home delivery in the cold chain is very tricky, and no one is really doing it well right now,” Joe says.

This means changing the backbone of the infrastructure that underpins the logistics processes. “This might be looking at more warehouses in urban locations. If you have time-sensitive goods, you need to be closer to your consumer,” he says.

These growth industries are creating a tremendous opportunity for 3PLs. “Any business in the food chain or consumer packaged goods has seen phenomenal growth during COVID. So have cosmetics, home improvement stores, furniture, the list goes on. If you are a 3PL in this space, this is a massive opportunity,” Joe says.

It’s up to the 3PLs to step up and accommodate the increasing demanding fulfilment times and look at ways to enhance their capabilities through technology and become more flexible to provide retailers with the tools needed to better serve their customers. ■ MHD SEPTEMBER 2020 | 51

MHD EVENTS

SUPPLY CHAIN VISION IN THE DECADE FOR ACTION ASCI2021 promises to demonstrate how Australian supply chains have weathered COVID-19 and provide insights to their future resilience.

I

f any images comes to define the COVID-19 pandemic, it may be the sight of normally well-stocked supermarket shelves emptied of consumer goods from pasta and flour, to toilet paper and hand sanitiser.

While panic buying was an irrational response to the nature of the COVID-19 threat – there was no chance of Australia running out of many of these items – what the rush on supermarkets and other stores did demonstrate was the finely calibrated nature of Australia’s supply chains. To meet the needs of consumers for fresh goods at any time of the year and to avoid overwhelming storage spaces, Australia’s supply chain managers have been working to ensure that products are ready just in time, ready to be plucked from the shelves at a customer’s whim.

The massive increase in demand due to panic buying brought to light the fragility of this system. In addition, as international flights were grounded, Australia’s ability to export its world-renowned fresh produce was immediately curtailed.

What this did was bring the role of the supply chain manager, and the people who enable the links in the chain to connect, out of the back-office and into the public spotlight. Monique Fenech, head of sales and marketing at the Australasian Supply Chain Institute (ASCI), has seen this firsthand.

“The COVID-19 pandemic has really brought supply chain management to the forefront of people’s minds. We’re starting to talk about supply chain as an essential service, which has never been the case before.”

In a way by virtue of its success, the complexity of Australia’s supply chain has not often been on view to customers, however the critical role of the professionals in this field has never been more in demand as trade routes recalibrate and new 52 | MHD SEPTEMBER 2020

“

The COVID-19 pandemic has really brought supply chain management to the forefront of people’s minds.

We’re starting to talk about supply chain as an essential service, which has never been the case before.

”

markets are being identified.

“Supply chain management rolls off people’s tongues, they’re all talking about it from a consumer standpoint. But even more impact has been made within organisations because supply chain managers have been brought into the boardroom to fix this problem, look at these outages, look at these delays, look at these increased prices.

Executive are asking, ‘We don’t have access to our air freight like we used to, what are we going to do?’ So that’s really changed the internal profile of supply chain management within the organisation,” said Fenech.

While the scale and magnitude of the current crisis may be beyond what was planned for at the beginning of 2020, Fenech counters that dealing with these kinds of issues, whether they be due to a pandemic or other cause, is actually the bread and butter of the profession.

“This situation is business as usual for our supply chain managers; they deal with risk on a day to day basis. A good example of that is where perhaps they might have a dual sourcing strategy in place already because for some, not all, supply chains that would be considered best practice, so they would already have set in place some business continuity strategies.”

The next step will be for companies to reset their risk management plans and contingency procedures to account for the ongoing restrictions and the likelihood of another pandemic happening again. This reality calls for supply chains to not simply return to a pre-COVID-19 status, but rather learn from the experience of the pandemic and bounce back more resilient than ever.

“As opposed to going back to the way things were, it’s about bringing all of the political, economic, geographic, and social impacts that affect our supply chains into the mix using really smart technologies such as artificial intelligence to give us a better

MHD EVENTS idea of where our supply chains are vulnerable and how we can improve them in the new decade,” said Fenech.

This next decade will be the focus of the ASCI’s conference, ASCI2021, to be held on the 23rd and 24th of February at the William Inglis Hotel in Sydney.

The conference’s theme is Supply Chain Vision In The Decade For Action, adapting the United Nation’s priority of the same name for the supply chain industry. Janet Salem, economic affairs officer, circular economy at the United Nations will deliver an international keynote highlighting the theme’s application for supply chain managers.

One area that Fenech sees as improving based on the experience during COVID-19 is the connection and collaboration between suppliers, something that the conference will highlight.

“Deepening the collaboration that we have with our suppliers is only going to make the supply chain more efficient and also more robust. Once that trust is there and the collaboration is there, the visibility inevitably becomes greater, and that is the end goal for a supply chain manager – to have complete visibility across the end to end supply chain and sometimes it takes something like a catastrophe to bring you closer to your supplier.”

DELIVERING BEST PRACTICE IN SUPPLY CHAIN MANAGEMENT For the past 60 years, ASCI has been working with the supply chain management industry to grow the career of supply chain management.

“Back in the early days inventory management was a new career and we travelled to the US to find some global standards that we could use in Australia. We’re applying that same technique now to global end to end supply chain standards and in order to do that we’re looking at global compliance and global regulation and bringing that down to the level that we need to communicate to members,” said Fenech.

In Australia, ASCI provides best practice knowledge to build the standards of supply chain management.

“We call that our Professional Accreditation Scheme. Just like lawyers, engineers, and accountants, they have professional accreditation bodies that

they belong to and they are registered within a professional accreditation scheme as well. That proves that they can practice within that field and they’ve proven their knowledge in that field,” said Fenech.

“We’ve never had anything like this in supply chain management in Australia so now is really good time to address it, considering the complexities of the end to end supply chain have been made so apparent through COVID-19.”

To assist its members in adapting to the disruptions of COVID-19, ASCI is conducting research and benchmarking global best practice so that Australian supply chains can come out of the pandemic more resilient that ever.

“Currently ASCI is working with the University of Melbourne on a risk survey, to see how we’ve been redefining risk and that will be a really important part of our conference on day two where we will be presenting those findings for the first time and giving our supply chain managers who are delegates at that conference a first look in as to what they need to be doing to reset their business continuity plans.”

While discussions were held at the beginning of the pandemic to understand whether the conference’s theme should change to focus directly on the events of the past six months, the advisory board ultimately decided that Supply Chain Vision In The Decade For Action encompassed the ongoing challenges that supply chains would face into the future.

“If companies don’t change the way they do things and put their supply chains front and centre of their operational efficiency, then they’re just not going to survive in the new era,” said Fenech.

Over the two days of the conference, ASCI has assembled a panel of local and international supply chain leaders, who will share their insights from a range of sectors. These include the medical, industrial, defence, and fast-moving consumer goods sectors as well as the transport and logistics sector.

On February 25, delegates will be able to tour the under-construction Western Sydney Airport site, the core of the future Aerotropolis and new logistics hub for Western Sydney. Attendees can participate in a panel discussion with

Janet Salem will deliver the international keynote.

local councils, moderated by Amanda Brisot, general manager Western Sydney Business Connection.

With multiple streams on each day, Fenech highlights that it is worth businesses bringing multiple attendees.

“If supply chain managers can think about bringing a few members of their team because there are certainly different experiences that each of their team members could have throughout the two-day conference and then come together afterwards to share key learnings across those functions.”

Streams on day one will cover procurement, operations management, and logistics management, while on day two streams encompass systems and technology, supply chain management, and the future supply chain management workforce.

“There are some great stories in there from Metcash, for example, about how COVID-19 brought about some great opportunity for them to work with Woolworths and Coles,” said Fenech.

ASCI2021 will also host the 28th ASCI awards dinner, and with so much upheaval during the past year, Fenech expects some engaging stories to come out of the awards.

“It will be one of the best because we want to see where excellence exists, where excellence has been demonstrated through these really tough times, and often it’s during tough times that innovation really does push through.” ■ For more information, to book tickets, and view the full program go to: www.asci-2021.com.au/.

MHD SEPTEMBER 2020 | 53

MHD PROPERTY FOCUS

LOOKING AHEAD Since the outbreak of COVID-19, there is now more clarity around the outlook for the Australian industrial and logistics sector. Luke Crawford, Associate Director, Research at Colliers International provides an update on what this means for the industrial property market.

W

hile there was a significant level of uncertainty in the market in April and May as the economy entered lockdown at a national level, the sector has since proven how resilient it has been with leasing enquiries growing strongly over the past month and investment volumes being at a similar level to the same time last year.

The pandemic has emphasised the importance of logistics as a key cog within the economy and occupiers will have to further embrace changing consumer preferences. From an industry perspective, it’s a tale of two sides with some industries outperforming and experiencing significant revenue growth, while others have been severely impacted as a result of patchy levels of demand and supply chain impacts. The sectors that have benefited the most in the new environment have been those aligned with online retail as the current stimulus 54 | MHD SEPTEMBER 2020

packages and stay at home orders have prompted a surge in demand.

Several trends have emerged or have become more apparent over the past quarter and they include: • Online retail continues to gather momentum, increasing by 31.9 per cent in the year to June 2020, up from 13.6 per cent in January. Online retail accounted for 9.7 per cent of total retail sales in June compared to 6.1 per cent a year ago.

• Industrial supply levels in some capital cities have been impacted as several speculative developments have been paused in the current environment.

• Off the back of heightened demand for food logistics, institutional interest in the cold storage sector has grown significantly. There have been a number of significant cold storage transactions recorded since COVID-19 which highlights this.

• The lockdown period and the largescale work-from-home orders has elevated demand for data centres as cloud storage requirements have grown rapidly.

• Despite leasing demand softening at the depths of COVID-19, industrial vacancy rates across the country remain low and will keep pressure on face rents.

ECONOMY At a macro level, the Australian economy has deteriorated rapidly as the lockdown measures implemented effectively pressed the pause button on the economy. A significant contraction in GDP is expected in the June quarter and coupled with the contraction in March 2020, Australia will enter its first technical recession in almost 30 years.

In the short term there remains some challenges as restrictions in some states increase and there will be subsequent

MHD PROPERTY FOCUS

Luke Crawford is Associate Director, Research at Colliers International. rises of 1-3 per cent in some submarkets over the past quarter. Looking ahead, headline rents are expected to remain steady as owners instead opt to drive incentives to secure tenants and preserve value.

INVESTMENT MARKET Online retail continues to gather momentum, increasing by 31.9 per cent in the year to June 2020.

spill over impacts to the Australian industrial market as goods can’t move around as freely as they could given border restrictions and employee capacity constrains in distribution centres. Encouragingly, some green shoots have begun to emerge and is underpinned by a stabilisation of job losses in recent weeks.

OCCUPIER MARKET Occupier demand has picked up considerably since the beginning of June as businesses focus on future-proofing their supply chain capabilities. As the impacts of COVID-19 are now better understood on business operations, occupiers are now progressing ahead with their business and capital expenditure plans. Several significant lease deals have been recorded in recent months which highlight this and includes precommitments to Amazon (approximately 200,000 sqm at Oakdale West Estate at Kemps Creek), Woolworths (75,300 sqm within the Moorebank Logistics Park), Coles (60,000 sqm across two facilities in Sydney and Melbourne) and Ford (51,595 sqm at the Merrifield Business Park).

From a rental perspective, the market has, so far, not seen a reduction in headlines rents. Incentives are generally firm as supply remains limited or pre-committed across most markets, although there have been modest

“

As the impacts of COVID-19 are now better understood on business operations, occupiers are now progressing ahead with their business and capital expenditure plans.

”

Activity within the industrial sector has been strong with over $3.4 billion trading so far in 2020 and is largely on par with the levels recorded at the same point in 2019. The flight to quality thematic is playing out and unlike recent years, most assets to recently trade are prime core assets. Local institutions remain the most active in the market and there is a significant depth of capital chasing core assets with covenant security.

The key theme in the investment market in 2020 has been the pick-up in sale and leaseback transactions as corporates take advantage of the continued strength of the industrial and logistics market. Sale and leaseback transactions have totalled $2.1 billion this year and compares to $1.4 billion in 2019. Activity has stemmed from a diverse corporate profile with 32 per cent coming from retail trade, 24 per cent from technology and 23 per cent from manufacturing-based businesses.

Looking ahead, industrial and logistics volumes are expected to remain strong in the second half of the year with several large assets currently in the market for sale. It is expected that additional sale and leaseback assets will trade in the second half of 2020 as businesses with pressure on their balance sheet bring their real estate to market. After initially forecasting prime core yields to remain at their pre-COVID-19 levels, recent acquisitions in the sector instead support a modest level of firming over the past quarter in selected submarkets. ■ MHD SEPTEMBER 2020 | 55

MHD FROM ASCI

SUPPLY CHAIN MANAGEMENT SKILLS GAPS AND SHORTAGES AT TWO MILLION BY 2025 Last month during National Skills Week, the Accreditation Body for Supply Chain Management, Australasian Supply Chain Institute, announced an Instructor Development Program aimed at standardising supply chain management knowledge in Australia to address a skills shortage of two million by 2025.

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he Instructor Development Program is a capacity building program for ASCI’s APICS alumni community to endorse them as instructors in best practice supply chain management knowledge based on ASCI’s Supply Chain Management Body of Knowledge, which draws from global certification partners including APICS. According to ASCI President, Alexandra Riha, the program is a sustainable way to address skills gaps in the supply chain community and draw from the expertise of our alumni community.

“Supply chain management is a fairly new discipline and so, it includes many practitioners who have come from other disciplines resulting

in an inconsistent delivery of best practice knowledge. As a result, skills are overweighted in technology and data, but are limited in applying key learnings from data,” she said.

By 2025, there will be a shortage of two million workers across the supply chain, and that doesn’t include any issues around the current disruption due to COVID-19.

“As we bring in the next generation of supply chain practitioners, and indeed encourage career changes for those in other disciplines to join supply chain to help fill the skills shortages, it’s our responsibility to ensure that this generation can pass on best practice knowledge.

However, despite the forecasted skills shortage, Alexandra is optimistic for the future.

“Since the 1960s, we’ve trained over 130,000 supply chain practitioner around the world in APICS certification and, in Australia, we have over 600 alumni that are eligible to join ASCI’s Instructor Development Program.

Now is the time to empower our supply chain leaders to impart their knowledge,” she says.

BENEFITS TO THE INSTRUCTOR • Specialist educator within the organisation, industry or industry body 56 | MHD SEPTEMBER 2020

• Option to continue to Master Instructor • Gain a profile within the supply chain community

BENEFITS FOR THE ORGANISATION • Succession planning • Mitigating risk • Business continuity

BENEFITS TO THE INDIVIDUAL Understanding of the interactions and inter-dependencies across business functions with 4,000+ standard supply chain terms • Build the skill to provide insights into how the various pieces work together and what tools, approaches, technologies and measurements support and encourage achievement of supply chain objectives • Commence pathway to Registered Practitioner under the ASCI Professional Accreditation Scheme ■ For more information about the Instructor Development Program, the upcoming Train the Trainer courses and the global certifications that make up the ASCI Supply Chain Management Body of Knowledge, visit the ASCI website: www.asci.org.au

MHD FROM ASCI

ASCI MEMBERSHIP Australasian Supply Chain Institute is the Professional Accreditation Body for Supply Chain Management and the first to offer an evidence-based Registration under a Professional Accreditation Scheme. Start your journey to professional registration and join us today. Here are three more reasons why ASCI Membership is right for you:

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BUILD YOUR PROFESSIONAL SUPPLY CHAIN NETWORK AND CAREER

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GAIN DISCOUNTS ON TRAINING, CERTIFICATION, CONFERENCES AND EVENTS

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ASCI Leadership Series* (quarterly in each state) ASCI Leadership Cup* (annual event) ASCI Networking Breakfast Series* (monthly in each state) ASCI Site Visit Series* (quarterly in each state) ASCI Webinar Series And Recorded Webinars (weekly nationally) ASCI Awards Program ASCI Special Interest Groups ASCI Board, Chapter, Professional Committee, Conference Advisory, and Awards involvement ASCI Member Closed LinkedIn and Facebook Groups

ASCI Monthly Newsletter ASCI Lounge Podcast Channel ASCI Blog ASCI Library (past webinars, reports and white papers ) ASCI The State of Supply Chain Management Report (Annual Member Survey) MHD magazine (monthly)

ASCI Annual Conference APICS Learning Systems Institute For Supply Management Certification VCare Certification Oliver Wight Short courses Partner conferences Association events and webinars and hack-a-thons

MEMBERSHIP CAN BE PURCHASED FROM ASCI’S WEBSITE WWW.ASCI.ORG.AU

MHD SEPTEMBER 2020 | 57

MHD FROM THE ALC

Some jurisdictions require drivers to present a negative COVID-19 test result before crossing the border.

COMMITMENTS MUST BE BACKED BY ACTION IN COVID RESPONSE The COVID-19 pandemic has required people to deal with scenarios and situations that were hard or even impossible to anticipate.

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f course, the freight and logistics industry has long-held concerns about some of the complexities that arise from having to comply with multiple regulatory regimes as freight crosses the border from one state or territory into another. Yet the closure of those same borders at the onset of the pandemic has forced the industry to confront and adapt to a whole new set of requirements.

The fast-moving nature of the COVID-19 challenge has also required governments and regulatory authorities to move speedily – and in some instances, this has led to the imposition of rules that are simply incompatible with the realities of freight transport.

Perhaps unsurprisingly, there were missteps by various authorities in the early stages of the pandemic over practical matters such as ensuring truck rest stops remained open and accessible to drivers. This showed there was need for a multi-jurisdictional agreement 58 | MHD SEPTEMBER 2020

that could provide clarity and certainty for the industry as it sought to keep delivering for communities despite the disruptions caused by COVID-19.

Consequently, over several months ALC worked with its members, regulatory authorities and allied industry groups to build support among governments for a nationallyconsistent approach that will protect the health of the freight transport sector’s workforce and the wider community, while still ensuring that our industry can get the job done.

Those efforts bore fruit in late July when the National Cabinet gave its endorsement to a Domestic Border Control Freight Movement Protocol.

The protocol was been endorsed by chief health officers from all state and territories and clearly outlines measures that all states and territories agree will allow freight to move safely and efficiently across borders.

This includes a number of common-

sense measures which ALC has pursued throughout the pandemic, including the ‘waive through’ of freight vehicles at borders, standardising the duration of border crossing permits, mutual recognition of COVIDsafe work plans developed in other jurisdictions and not requiring truck drivers or rail crews to quarantine or self-isolate when crossing borders if they have not developed COVID-19 symptoms.

Obtaining agreement to this protocol was only possible because our industry has been able to clearly and convincingly demonstrate its commitment to COVIDsafe practices to governments nation-wide.

In particular, the members of ALC’s Safety Committee played a pivotal role by offering compelling examples of the extensive efforts being undertaken by major freight and logistics companies to make their operations COVIDsafe.

This gave policymakers added confidence that our industry takes

MHD FROM THE ALC

“ its obligations seriously and understands the importance of COVIDsafe behavior in protecting the wider community.

The importance of having COVID testing available for freight workers frequently crossing borders is also recognised, and the protocol calls for states and territories to offer ‘pop up’ testing facilities in appropriate locations and agree a nationally-consistent set of requirements for the frequency of tests if such tests are to me made a condition of border-crossings.

Importantly, the protocol also requires authorities to consult with industry to understand the effect and impacts of potential changes ahead of any new directions being been put place.

This made it especially disappointing when, less than a week after the protocol was agreed to, some jurisdictions disregarded its provisions by imposing changes to border crossing requirements without adequate consultation (or even notice to industry).

At the time the protocol agreed, the National Cabinet also flagged it would be strengthened through the introduction of a binding Freight Movement Code. This step was intended to achieve harmonisation in the application of border control measures.

The importance of having COVID testing available for freight workers frequently crossing borders is also recognised, and the protocol calls for states and territories to offer ‘pop up’ testing facilities in appropriate locations and agree a nationallyconsistent set of requirements for the frequency of tests if such tests are to me made a condition of border-crossings.

”

In particular, it was hoped that consistency could be achieved around requirements for COVID-19 testing for freight drivers, requirements around self-isolation while waiting for test results and record keeping requirements to assist with contact tracing.

ALC especially welcomed the Code’s commitment to integrating testing into driver schedules and to ensuring symptomatic and asymptomatic people are kept separated at testing sites.

The Code’s stipulation that freight workers will not need to go into quarantine or formal self-isolation in any jurisdiction will also especially important in minimising disruptions to freight movement for the duration of the pandemic.

Likewise, the Code’s commitment to the mutual recognition of COVIDSafe workplans between jurisdictions is essential to reduce the administrative burden on trans-border freight operators.

Yet, the protocol and its associated Code can only deliver its intended outcomes if all parties – governments, regulators and industry – adhere to its terms, most particularly around the need for consultation and consistency.

At time of writing, there remain some significant inconsistencies around driver testing requirements. Perhaps the most notable example is that some jurisdictions require drivers to present a negative COVID-19 test result before crossing the border.

Yet Victoria does not currently facilitate the testing of asymptomatic people – meaning drivers from (or passing through) Victoria find it difficult to comply with the requirements of those jurisdictions who do require tests.

Of course, industry understands the significant additional demand that Victoria’s testing facilities have been placed under, given the ‘second wave’ outbreak in that state. But if disruptions to freight movement are to be avoided, a practical way around this inconsistency will need to be found. ALC has suggested that may be appropriate for the Federal Government to provide Victoria with some additional support to help make this happen, in the interests of national supply chain efficiency.

No one can be certain when the COVID-19 pandemic will end, which makes it all the more important that governments follow through on commitments and ensure communities can continue to access the essential items they need. During this crisis, collaboration between our industry and governments is not merely desirable, but essential. ■ MHD SEPTEMBER 2020 | 59

MHD SCLAA

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SCLAA UPDATE

o say that we are ‘living in interesting times’ is certainly not an understatement. I do however strongly believe that these challenging times will result in innovation, team work and a very positive future for the supply chain and logistics fields in Australia.

When the lockdown was implemented in mid-March, the SCLAA, along with so many other associations and organisations, had to review the way we do things and adapt quickly. I am proud of the SCLAA Board and all our State Committees for so whole heartedly taking on this challenge. The SCLAA is proud of the presentations, networking events and site visits that we have

SCLAA Board members and State Presidents at the 2019 ASCL Awards.

60 | MHD SEPTEMBER 2020

been providing for many years and the smooth change to the virtual world in the space of a couple of weeks by the many dedicated SCLAA volunteers is to be commended.

The SCLAA has held over 20 webinars since then and a number are planned for the coming months. Recordings of a number of these webinars are available on the members page of the SCLAA website.

We are all looking forward to the time when restrictions are completely lifted across the country and face-to-face events can recommence. With restrictions lifting with WA, the Western Australian Division of the SCLAA held their first

Joshua Holmes, SCLAA National Chairman.

MHD SCLAA

Amanda O’Brien and Michael Gallacher (CEO Ports Australia).

SCLAA 2019 Awards. face-to-face networking event on 14 August and other face-to-face events are planned. The SCLAA will however continue with webinars into the future enabling our members and many industry colleagues to continue to have countrywide access to information.

The very successful Mentoring Program that has been running in the VIC/TAS Division for three years moved online with a virtual launch on 3 June for the 24 mentees and mentors.

This year, our other Divisions have adopted the program with the NSW Division launching on 11 August and the Queensland Division launching on 12 August. A special thanks goes to all the organising committees and mentors who are giving of their time to nurture the amazing talent in our industry.

The 21st annual Peter Smith Memorial Golf Day is scheduled to take place on 16 October 2020 at the Kiwana Golf Club (pictured right) in Perth. This event has been organised by the WA Division since its inception, with profits being donated to charity. Should anyone like to take part in this event, there are still places available. Registration can be made online via the WA Golf Day event page on the SCLAA website.

The Call for Submission for the 2020 Australian Supply Chain & Logistics Awards are open and some submissions have already been received. This year there are seven categories and companies and individuals are encouraged to make submissions. These prestigious Awards have been running for almost 60 years and many eminent supply chain and

logistics professionals are past winners.

The annual ASCL Awards Gala Dinner, which is usually held in November each year, will be taking place in March 2020.

Finalists in each of the categories will be announced on 18 November and winners will be announced at the Gala Dinner.

A challenging, innovative and hopeful

future awaits all of us in supply chain and logistics and it is with optimism that I look forward to future of our industry, in which we will have a part to play. Let us rise to this occasion. â– Joshua Holmes SCLAA National Chairman

CALL FOR SUBMISSIONS NOW OPEN Submissions close on Friday, 24 October 2020. Finalists to be announced on 18 November 2020. Winners will be announced at the ASCL Awards Gala Dinner to be held in the first quarter of 2021.

2020 ASCL AWARD CATEGORIES & CRITERIA Future Leaders Award Industry Excellence Award Environmental Excellence Award International Supply Chain Award Supply Chain Management Award Training, Education & Development Award Information Technology & Management Award

2020 Future Leader Award Winners.

Blake Kelly and Val Brusylovsky

For Category & Criteria Information and online submissions visit www.sclaa.com.au/awards/

MHD SEPTEMBER 2020 | 61

MHD THE LAST WORD

IMPLICATIONS OF THE COVID-19 PANDEMIC Freight & Trade Alliance and the Australian Peak Shippers Association provided a formal submission to the Inquiry into the implications of the COVID-19 pandemic for Australia’s foreign affairs, defence and trade.

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ince providing our formal submissions to the Inquiry, we have become extremely concerned by the current second wave of COVID-19.

While we fully support the need to safeguard the health of our community, we equally need to keep our international supply chain sector open. Our membership has serious concerns that a stage 4 restriction in Victoria could involve a complete lockdown over an extended period of time. This would have devastating economic and welfare implications.

We need to keep the entire international supply chain open from our wharves and airports through to exporters and importers. This includes stevedores, air cargo terminal operators, transport operators, licensed depots, fumigation providers, empty container parks, freight forwarders and customs brokers.

We understand from members that COVID-19 testing for Victorian supply chain and waterfront workers is currently taking from four to five days which means key-personnel are out for a period of time while awaiting results. Somehow this process needs to be fast-tracked for essential workers and to ensure business continuity.

GLOBAL BEST PRACTICE Assuming that we can keep trade moving during this global pandemic, we need to also focus on doing so in an efficient manner.

While the Australian government should be applauded for its work in liberalising trade, particularly in respect of signing key free trade agreements, this is off-set with the cost of international trade remaining 62 | MHD SEPTEMBER 2020

exceptionally high.

This is reflected in Australia’s ‘Doing Business Ranking’ as published by the World Bank. In 2020 Australia’s overall ranking was an impressive 14. However, its ranking for the sub-category “Trading Across Borders” was 106.

DIGITALISATION Australia must increase its investment in digitalisation. An example being that all Australian agriculture exporters are forced to print and courier “Original” versions of the Phytosanitary Certificate.

This is an incredibly laborintensive task, which is highly inefficient and costly.

Some steps have been taken in the context of Australian and New Zealand trade however solutions and standards are already available for many other markets. Disappointingly, what is absent, is the will for the Government to facilitate accelerated change. APSA and our large volume exporters are available to work with government to assist.

AIRFREIGHT Aviation has undoubtedly been one of the hardest hit sectors by the pandemic, devastated by the restrictions affecting passenger movements. Putting this in context, approximately 80 per cent of Australia’s international air cargo volume is usually moved in the belly of passenger aircraft.

Air freight costs have substantially increased without the crosssubsidisation and demand of passenger traffic.

The combined efforts of commerce and government has facilitated continuation of access to global

markets for Australian exporters, importation of time-sensitive goods (including medical, PPE and other essential supplies) and has maintained residual Australian jobs in the aviation sector by keeping aircraft flying.

We see significant merit in the recent announcement of an injection of another $241.9M to continue International Freight Assistance Mechanism (IFAM) until February and JobKeeper until March 2021 but have concerns that this alone will not be sufficient to adequately to support the sector.

CONTAINERISED SEA CARGO Shipping line market consolidation plus the emergence of stevedoreimposed Infrastructure Surcharges have been the primary reasons for supply chain costs.

INFRASTRUCTURE SURCHARGES If nothing else, our members desperately require relief from the imposition of stevedore-imposed Infrastructure Surcharges (now more appropriately referred to as Terminal Access Charges).

This charge alone has a direct cost to Australian exporters and importers in excess of $300M per annum in 2019.

Put very simply, instead of recovering costs from their commercial client (shipping lines), stevedores are holding transport operators to ransom to pay these charges or are denied access to wharves. Many transport operators have included administration fees to manage cash flow associated with these charges resulting in cascading costs flowing through thesupply chain. ■

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