MHD Dec 2020

DECEMBER 2020

COVER STORY

SECTOR SHAKE-UP The new technology platform lifting the roof on industrial property and warehousing

RECOVERY IN 2021

After disruption, uncertainty and challenge comes opportunity

SKILLS AND RECRUITMENT

What does finding the right leader for the right role entail post COVID-19?

250% Productivity Boost Automation at Asahi’s DC achieves results worth raising a beer to.

When consolidating its multiple Brisbane sites into the new Heathwood DC, Asahi made the decision to upgrade from previously very labour-intensive operations to a fully automated warehouse solution, eliminating manual handling of pallets.

With the introduction of a satellite ASRS solution, Dematic helped Asahi maximise storage capacity, reduce operating costs, and improve efficiency and productivity to better meet the needs of its customers.

Read more and watch the video at Dematic.com/asahi

Scan for the video!

Dematic.com/asahi 02 9486 5555 info.anz@dematic.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: Beth Jarvis Design Production Manager: Michelle Weston Art Director: Blake Storey Graphic Designers: Kerry Pert, Madeline McCarty Client Success Manager: Janine Clements

FOR ADVERTISING OPTIONS Contact: Beth Jarvis beth.jarvis@primecreative.com.au

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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.

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.

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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.

REFRESH, RECOVER AND REBOUND

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OVID-19 disrupted people’s lives, devastated the economy and caused an overall sense of uncertainty and vulnerability that only those who have experienced the impacts of war can relate to. However, as an essential service, supply chain and logistics continued to deliver.

Businesses across the nation had to adapt at record pace to ensure they continued to deliver goods and services to the nation’s population.

While many converted their homes into offices and workplaces, the logistics industry remained onsite. But it wasn’t business as usual.

The decision-making process across government and business changed drastically, with the fast pace of infections prompting industry and policy to act quickly.

Business decisions that would usually be pondered for months soon became a reality in days, even hours, across all sectors. Flexible working, video conferencing, restructuring, redefining roles and better use of technology became the norm.

What has fundamentally changed is our ability and willingness to be more agile, creative and flexible. When interviewing Matt Sampson, Co-Founder of Australian start-up uTenant, he said that when he had a break from the corporate world, he was able to think more creatively and come up with new ways of working.

I wonder if this shift from the ‘business as usual world’ we knew all too well will prompt us to think more creatively in 2021 and encourage a wave of innovation across Australia’s supply chain and logistics industry.

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

MHD Supply Chain

MHD DECEMBER 2020 | 3

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SOLUTIONS FOR EVERY PALLET ®

DECEMBER 2020

ISSUE #11 VOLUME 50

THIS ISSUE COVER STORY

16 Re-imagining industrial property

SUPPLY CHAIN 24 Trends to watch 27 Climate change risk 36 Advancing the supply chain 40 The world in 2021 42 Cracking the last mile

16

COVER STORY

TECHNOLOGY 14 E-commerce expansion 30 Simplifying the quote to cash process 32 Hot off the press 34 Innovative packaging concepts 46 Australia’s future of deliveries via drones

MATERIALS HANDLING 21 Toyota forklift aces customer satisfaction survey

WAREHOUSING 44 Investing in the region 48 Structural strength

DECEMBER 2020

COVER STORY

SECTOR SHAKE-UP

32

The new technology platform lifting the roof on industrial property and warehousing

STORAGE SOLUTIONS 10 Little changes produce big improvements

DEPARTMENTS AND REGULARS 06 News 14 In the warehouse

RECOVERY IN 2021

After disruption, uncertainty and challenge comes opportunity

38 IoT trends

SKILLS AND RECRUITMENT

What does finding the right leader for the right role entail post COVID-19?

52 Property focus 54 SCLAA 56 ALC

ON THE COVER

58 ASCI

We meet the Co-Founders of new technology platform uTenant, a start-up created with the goal of shaking up the industrial property sector.

62 People on the move

42 MHD DECEMBER 2020 | 5

MHD NEWS

DHL Express invests $1.2B to expand APAC facilities amid e-commerce boom

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n the back of unprecedented e-commerce growth, DHL Express will invest over $1.2 billion to build or expand its facilities in key growth markets of Australia, Japan, Hong Kong S.A.R. and South Korea.

The company will invest circa $1 billion between 2020 and 2022 to build and expand its facilities in APAC, including a $970 million to bolster its Asia Pacific air network such as introducing direct, new (e.g. Vientiane, Yangon), and frequent (e.g. Oceania) flight routes.

The expanded infrastructure and new flight routes across Asia Pacific will help the company tackle the unprecedented growth in shipment volume and address the ever-growing demand for timedefinite express deliveries.

DHL Express is expanding its facilities in key growth markets across Asia Pacific.

Amazon announces its second warehouse in Melbourne

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Amazon is expanding its capacity in Victoria to give customers faster delivery options.

6 | MHD NOVEMBER 2020

mazon Australia will open a second Melbourne fulfilment centre (FC) late next year. The facility will almost double the size of the Melbourne Cricket Ground, with capacity to house up to six million items from Amazon.com.au.

The new facility is currently under construction in an additional 200 construction jobs and will more than double Amazon’s operational footprint in Victoria, enabling Amazon to meet growing customer demand.

Amazon’s new Ravenhall FC will join Amazon’s first Australian FC in Dandenong South which opened in 2017, significantly expanding its operating footprint in Victoria.

According to Amazon Australia, expanded capacity across the two sites will enable Amazon and its sellers to increase the proportion of items that can be shipped directly to Victorian customers from Melbourne and enable faster delivery.

Introducing Manhattan Active Warehouse Management.

Cloud-native and built on 100% microservices, it redefines what a WMS can do, delivering exponential improvements.

Australia’s Most Awarded Warehouse Management System and a 12 Time Leader1 in Gartner’s Magic Quadrant for Warehouse Management Systems.

MHD NEWS

Woolworths trials robotic locker for click-and-collect customers

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oolworths has partnered with Cleveron, an Estonian-based company that produces robotics-based parcel terminals and creates click-and-collect solutions for retail and logistics sectors, to offer convenient automated solutions to its growing click-and-collect customer base.

In a statement released on LinkedIn, Woolworths revealed that it is trialling an innovative temperature-controlled self-service locker at its Granville store in western Sydney.

The locker provides a fast, easy and contactless way for customers to do their grocery shopping without entering the store. After placing an order online and selecting a pick up window, customers are sent a unique passcode, which offers secure access for collection. Customers can then park in one of three dedicated bays

Woolworths’ Granville store in Western Sydney is the first store to feature the new lockers.

next to the locker, enter their code and have their full order dispensed automatically within seconds.

Granville is the first store to trial the Cleveron AS lockers, with Woolworths stating that more will be rolled out

across the network soon.

This comes off the back of Woolworths Group revealing that its e-commerce sales lifted to $1.5bn in Q1 20/21. Across the Group, e-commerce sales were up 86.7 per cent on Q1 2020.

Global beverage company deploys Microlistics WMS

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Asahi Beverages will implement Microlistics Enterprise WMS in its Auckland warehouse.

8 | MHD DECEMBER 2020

eading Australian and New Zealand beverage manufacturer and distributor, Asahi Beverages, will implement Microlistics Enterprise WMS in its Auckland warehouse this year for real-time visibility of inventory and reduced manual processing.

Asahi Beverages, a member of Asahi Group Holdings, one of Japan’s leading beverage companies, has partnered with Microlistics to meet its long-term strategy for realtime visibility of inventory, a reduction in manual processes, and reducing multiple handling of products.

Asahi’s Head of Logistics & Planning NZ, Phil Riley, said

several factors contributed to the selection of Microlistics as its technology partner.

“We wanted an innovative WMS solution with highly flexible functionality appropriate to our needs, and importantly, local support and a good cultural fit,” Phil said.

Asahi’s operational objectives for the WMS are to automate and streamline all warehousing tasks, increase throughput, and optimise labour utilisation “Based on Microlistics’ track record we are confident Microlistics WMS will give us the capability to deliver increased service levels, not just today but for the long term,” Phil said.

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 STORAGE SOLUTIONS

LITTLE CHANGES PRODUCE BIG IMPROVEMENTS

Bob Griffin, Director at BAC Systems presents the three reasons why high-density drawer storage has the potential to save time and money as well as increase the effectiveness of the warehouse.

Three-dimensional storage can use up to three times less footprint than traditional shelving.

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AC Systems speciality is threedimensional drawer storage cabinets. “We build robust, full steel construction, high-density storage solutions. The drawers are modular so can be divided up into various sizes. The idea is that you create a size to suit the volume you require for your inventory,” Bob Griffin, Director at BAC Systems says.

For Bob, this type of storage offers a number of significant benefits. “With drawers, not only do you have better order, but you use less storage volume.

By using the three dimensions of space, you save significantly on property costs,” Bob says.

Three-dimensional storage can use up to three times less footprint than traditional shelving, according to Bob. The drawers can be divided into different locations of various sizes, so the idea is that the user creates a solution their inventory requires. “You work out how wide or deep you want the partitions to be so you are not wasting any space, this is different to a shelf or tub that has lots of wasted space,” Bob says.

10 | MHD DECEMBER 2020

According to Bob, there are three major benefits of three-dimensional storage:

1. REDUCED STORAGE FOOTPRINT BAC Drawers are fitted with adjustable partitions and dividers to create locations to suit the size of the parts needed to be stored. Whereas shelving, with little boxes, might use up all of the space along a shelf, it usually has dead space above the box, or even within the box. Drawers Storage eliminates most of this dead space resulting in massive footprint reductions. Often, storage may reduce down to a third of its original storage footprint when you move to a drawer storage solution and this small change can create big opportunities. It would be possible to increase your holdings, or to maintain an existing warehouse site when before fear of out-growing it.

2. REDUCED PICKING TIME As drawer storage compresses stock the result of this small change is the large benefit of decreased picking time. Inventory of small and medium

sized items can be compressed closer to packing areas and picking staff are walking less distance for the same number of parts. To help demonstrate this, we could look at one contrived example for a small dispatch warehouse (replace our numbers with yours to see the effect in your own workplace). Let us assume here that, with BAC Drawers, you reduce your average picking walk length from 25 metres to 12 metres (about nine seconds of walking in total), and if you pick 300 parts a day for five days a week, this will save you 180 hours a year. With these 180 hours, more parts could be picked, or over-time could be reduced, or warehousing staff numbers could be minimised, based upon your particular situation.

3. PART CLEANLINESS Sending out clean parts is a matter of image, but image is a contributor to good business practice. Having parts stored in drawers, rather than on open shelving, minimises dust and contamination, and keeps parts cleaner for longer. This is a very simple benefit, but the result may be the difference in gaining new business.

Upgrading to BAC Drawer Storage Cabinets is possible for any parts store holding an inventory of small parts to parts the size of a football. BAC Drawers can integrate into whichever inventory management systems being due to their logical layout.

Furthermore, to assist with the transition, the experienced BAC Technical Sales Team offers a free survey service, by coming onsite to calculate how best to configure drawers in order to suit inventory and the way a business operates. ■

CONNECT YOUR SUPPLY CHAIN MAKE YOUR ASSETS WORK SMARTER

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MHD IN THE WAREHOUSE

MHD Supply Chain

In this month’s MHD warehouse we feature the latest from Ferag, APC, Dematic, Kardex, Advantech and Körber Supply Chain.

E D I S IN D H M THE E S U O H E R A W ANDROID VOICE SOLUTION BY KÖRBER SUPPLY CHAIN Körber Supply Chain’s Android Voice solution, in partnership with Honeywell, gives operators the freedom to carry out their tasks efficiently and productively.

The solution ensures users are no longer required to spend time looking at picking slips but can instead listen to order details while they continue to pick and pack.

To find out more, visit: www.koerber-supplychain.com.

FERAG INTELLIGENT VEHICLES The state-of-the-art AGV and AMR vehicles with a complete range of products for intelligent intralogistics solutions are based on proven Quicktron technology. These mobile robots include automated solutions for the handling of shelves, mobile devices, pallets and basket of work without an operator.

For more info, visit: www.ferag.com.

AUSTRALIAN MADE RACKING AND SHELVING APC pallet racking and shelving solutions are designed, engineered and manufactured locally here in Australia,

by Australians and with Australian steel.

This ensures APC provide its customers with the most ‘fit for purpose’, flexible, cost-effective and Australian compliant designs.

To find out more, visit: www.apcgroup. com.au

12 | MHD DECEMBER 2020

MHD IN THE WAREHOUSE

DEMATIC RAPIDSTORE AUTOMATED STORAGE AND RETRIEVAL SYSTEMS (ASRS) Whether it’s for heavy unit loads like pallets or smaller loads like totes and cases, storage is a fundamental requirement of every distribution centre.

Yet storage is a paradox. On one hand it adds value by providing a critical buffer between your processes and your customer, whilst on the other hand it adds cost in land, building and inventory.

Compact in design and free from the burden of rising labour costs, Dematic RapidStore Automated Storage and Retrieval Systems (ASRS) are designed to minimise and mobilise your stock.

For more info, visit: www.dematic.com/en-au.

ADVANTECH DLT-V6210 FACELIFT VMT Featuring an Intel® Atom™ E3825 dual-core processor, IK08-rated impacttolerant touchscreen with projected capacitive touch control and 5M3 and MIL-STD-810F certification for shock and vibration tolerance, Advantech’s DLT-V6210 Facelift terminal provides a rugged in-vehicle computing solution.

The system is IP65 rated for protection from water and dust ingress and supports a -30 to 50 °C operating temperature range. It has a 10.4” XGA TFT colour display available with 600 nits or 1300 nits screen brightness and has been upgraded to support WLAN (IEEE 802.11 ac/a/b/g/n), WWAN (LTE, UMTS, HSPA+, GSM, GPRS, EDGE) and Bluetooth 5.0.

For more information, visit: www.advantech.net.au.

KARDEX REMSTAR LR35 VERTICAL BUFFER MODULE The Kardex Remstar LR 35 is a highly efficient, goods-to-person, bin handling system for storing and retrieving a wide range of small-to-medium sized goods.

Its high picking performance makes it suitable for use in many different industries.

This newly launched system is flexible and scalable for easy integration into existing processes. Easy operation from the ergonomically designed access opening minimizes picking errors and travel time while improving inventory control.

To find out more, visit: www.kardex-remstar.com.au.

MHD DECEMBER 2020 | 13

MHD TECHNOLOGY

E-COMMERCE EXPANSION European retail sporting giant Decathlon has deployed Körber’s AMR Goods-to-Person solution at its DHL managed fulfilment centre in Sydney. MHD investigates.

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ecathlon, the world’s largest sports retailer, launched in Australia with an online store in mid-2016. The organisation opened its first physical store in Sydney in 2017 and has since opened additional stores in Melbourne and Sydney.

As part of its aggressive expansion in Australia and off the back of a significant rise in online consumers, Decathlon has partnered with global technology giant Körber and DHL Supply Chain to deploy a new Goodsto-Person robot solution.

in Asia Pacific, will support operators to efficiently pack more customer orders, reduce turnaround time and drive accuracy.

With more than 15,000 SKUs in its Sydney fulfilment centre, Decathlon needed an innovative and practical solution that could scale up its ability to fulfil customer orders without prohibitively increasing variable costs.

“The pandemic brought with it a surge in e-commerce demand, particularly for sporting goods as gyms and fitness facilities around

Decathlon is one of the world’s largest sports retailers.

With aspirations to offer two-hour deliveries in metropolitan cities, Decathlon has invested in its logistics operations to improve operational efficiency and fulfilment speed at its fulfilment centre in Sydney.

The Autonomous Mobile Robots (AMRs), manufactured by global AMR manufacturer Geek+ and deployed at DHL by Körber, a market leader with an impressive AMR solutions track record 14 | MHD DECEMBER 2020

Australia were forced to stop trading.

Our aim is to continue delivering the exceptional service our customers have become accustomed to, regardless of the challenge,” Olivier Robinet, CEO, Decathlon Group Australia says.

Capable of moving at speeds of close to one metre per second, the robots will allow workers to despatch up to 144 customer orders per hour – more than double the productivity expected

in a manual environment.

The AMRs autonomously navigate their way within the warehouse, with the ability to locate and deliver items to pickers within 25 seconds. They can be flexibly deployed to support a diverse range of picking strategies, significantly minimising time spent on routine or physically demanding tasks, reducing manual errors and increasing productivity.

Present in more than 50 countries, Decathlon has over 1,600 stores globally and is familiar with the world of mobile automation, having previously implemented Geek+ AMRs at sites in China and Russia.

Körber, and DHL Supply Chain, will deploy the first AMRs at Decathlon’s facility in Sydney, with a view to extend their use to more facilities around the country.

The team at Körber delivered the project in a record three months, enabling the retailer to capitalise on the e-commerce boom driven by COVID-19 lockdowns and restrictions across Australia.

Körber has had recent success with the same solution across Australia’s leading online retailers, including e-commerce heavy weight Catch Group.

Catch Group, part of the Wesfarmers Group, recently deployed the AMRs at its distribution centre in Truganina, Victoria. The AMR roll-out consists of more than 100 robots and is the largest deployment of its kind for an e-commerce marketplace in Australia and New Zealand.

The Körber AMR solution provides Catch with the ability to pick an additional 2,000 orders an hour and Decathlon is set to reap similar benefits from its deployment of this technology as it continues to meet the rising demand in online sales. ■

Dexion set to launch new state-of-the-art manufacturing facility.

Dexion Asia Pacific is taking the next step to strengthen our presence in the region by investing in a new state-of-the-art manufacturing facility in Malaysia.

Construction is scheduled to commence in December 2020, and the site is expected to be complete by of end 2021. The purpose-built facility is designed to produce best-in-class intralogistics storage solutions that will cater to the APAC markets including Australia, Southeast Asia and India.

Contact Dexion today for world class solutions for your warehouse.

1800 100 050 dexion.com.au

MHD COVER STORY

RE-IMAGINING INDUSTRIAL PROPERTY An Australian start-up is making waves in the industrial property sector and has plans to become the number one place for tenants to find new warehousing space.

MHD catches up with uTenant’s Co-Founders to find out more.

In addition to its industrial property service, uTenant has created a free pallet matching service.

16 | MHD DECEMBER 2020

MHD COVER STORY

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s we sit down with uTenant Co-Founders Matt Sampson and Kyle Rogers the pair are celebrating a record month. The industrial property start-up has matched close to 50,000 sqm across Australia in November 2020, and while this sets a record, Matt and Kyle both agree that this is just the beginning.

“We’re doubling year on year. Not just in revenue and customers but also in the size of our team, platform traffic and capabilities,” Matt Sampson, Founder and Managing Director of uTenant tells MHD. Officially launching in 2017, uTenant’s mission is to make life easier for tenants and landlords alike, with the goal to increase transparency and confidentiality across the industrial property sector.

Matt has a long history in the real estate industry. Having worked for CBRE for eight years as Associate Director of Industrial & Logistics Services, Matt started his own boutique industrial real estate agency in 2015. It was then that Matt started to explore different ways of working in industrial property.

“When you’re out of the corporate world, your conscious creative mind has the space and time to think about how things can be done differently and more effectively,” Matt says.

In 2015, amidst a tech start-up boom where industry giants such as Airbnb and Uber were experiencing a surge in users and interest, Matt started to think about the industrial property industry and how it could benefit from a shake-up.

“From a tenant perspective, there are a lot of pain points. Often, the tenant has no idea what is going on behind the scenes so the whole process is complex and at times very difficult,” Matt says.

If a tenant is looking for a new warehouse, they usually explore online listings and speak directly to agents. However, Matt says this adds an extra layer of complexity. “Some listings don’t exist, some might have been filled six months ago and some don’t even make it to the listing page.”

Beyond the inefficiencies of searching for available properties, Matt says another common issue in industrial property is the lack of transparency and confidentiality for the tenant.

“When a business moves to a new warehouse, there are a lot of ancillary services and products affected by that move.

Pallet racking providers, materials handling products and services are all attached to this decision so it can get very complex.

Confidentiality for the tenant is really

“

If you have pallets and need space to put them, we can help. If you have space you need to fill, we can help.

And ultimately if you need a new warehouse, we can help you find one in a cost-effective, transparent and much easier way.

”

important here,” Matt says.

Furthermore, Matt says there is a lack of transparency in the industrial property industry and addressing this is a major priority for uTenant. “We do this by operating a flat fee across the country. Generally, tenants are oblivious to the market fee structures, but we are completely open about ours,” Matt says.

By operating a flat fee structure, uTenant remains strongly independent, as its commission remains the same regardless of the property the tenant selects.

Established with the aim of offering greater efficiencies in the industrial property market, uTenant provides an online platform that presents a bespoke list of all relevant options to the tenant. The aim is to enable its clients to make the best property decision for their business strategically, operationally, and financially.

“We have created a user-friendly platform that allows new tenants to look at all possible options in one place, instead of trawling through online listings and ringing multiple agencies,” Matt says.

ONE-STOP SHOP Last year, Kyle Rogers joined the uTenant team as Co-Founder and General Manager.

Inspired by tech start-ups such as Instagram, YouTube, LinkedIn and Facebook. Kyle wanted to bring the same thought process and principles to uTenant and as a result established a new arm to the business.

With the same founding principle of creating more transparency and value in the industrial property and warehousing industry, Kyle recognised that many leading start-ups offer their users a free service that compliments any paid-for offerings.

“We have created a free pallet matching service which helps tenants to find and fill their excess warehouse space. Unlike similar warehouse brokerage firms we don’t charge for this service,” Kyle says.

By helping businesses to find and fill internal space, uTenant is able to build relationships with the entire supply chain, and when it comes to searching for property the model is tried and tested.

“We are the one-stop shop for warehousing needs. If you have pallets and need space to put them, we can help. If you have space you need to fill, we can help. And ultimately if you need a new warehouse, we can help you find one in a cost-effective, transparent and much easier way,” Kyle says.

In November alone, uTenant placed over 11,000 pallets of FMCG products into various

MHD DECEMBER 2020 | 17

MHD COVER STORY 3PLs across the country and didn’t clip the proverbial ticket. “It’s a bit like YouTube in a way,” Kyle says. “The world’s largest video platform does not charge users to watch or upload videos.

Instead YouTube makes the majority of its revenue through advertising.”

Kyle goes on to add that this is what’s known as a three-sided platform or marketplace. “It’s simple really. Add value to two sides (tenants trying to find or fill their space) to generate revenue from the third side, i.e. the landlords.”

The uTenant platform can sift through more than 100 3PL providers to find out who can help find space for the product that needs to be stored and present the customer with an array of options. “The fundamentals are the same, and the platform’s goal is to increase efficiency in these otherwise inefficient processes,” Kyle says.

A NEW WAY TO LEASE PROPERTY uTenant is not an advertising site, it’s not possible to go online and look through a list of available space, instead it offers a personalised approach. “You can enter your requirements into the system and then you will be presented with a specifically curated list of options based on your criteria of space, location and operational needs,” Matt says.

Once a query is received in the platform, uTenant will ensure that all options are covered off, either directly with landlords or through its network

of agents nationally.

“If you are a supply chain, procurement or logistics manager and you need a warehouse either short-term or long-term, uTenant will cover off the entire market and bring you options you didn’t know existed,” Kyle says.

The platform itself has been designed with the user in mind. Matt says this was a key priority from the outset. “The industrial property industry is probably the slowest of the sectors to embrace technology and often this can create frustrations for occupiers due to out of date information or a slow response time to requests for details,” he says.

With both Kyle and Matt having such extensive experience in the supply chain, industrial property and logistics industry, they are well placed to offer relevant and quality options to the tenant.

“Sometimes tenants are presented with options that don’t fit their requirements at all, we make sure that we only present the ones that are relevant and suitable for our clients rather than a long list for the sake of it,” Matt says.

A further advantage of working with uTenant is its ability to introduce both tenants and landlords to ensure that the negotiations can take place directly.

“Because of our full transparency on cost and fee structure, we are happy for the negotiations between the tenant and landlord to take place independently of us. This can also

In November alone, the uTenant platform has matched more than 50,000 sqm of warehouse space across Australia.

provide a greater outcome and offers the opportunity for strong working relationships between tenants and landlords to develop,” Matt says.

Something that Kyle says is of huge value to large organisations who often have several senior leaders across the business who are experienced in negotiating at this level.

GIVING BACK TO THE INDUSTRY

Matt Sampson (left) and Kyle Rogers, Co-Founders of technology platform uTenant.

18 | MHD DECEMBER 2020

uTenant’s team is creating more than just a business, they are creating a community. “The community aspect of what we want to achieve is huge.

We want to build a better ecosystem of services for the industry we are trying to help,” Matt says.

The structure allows uTenant to align itself with the outcomes of its clients and to this end they structure the fees to provide a rebate back to the tenant on completion of any property transaction (except NSW).

“Through our reduced fees, free pallet matching service and rebates to tenants we have left in excess of $1 million on the table over the last year or two. This creates more profitability for our warehousing community,” Matt says.

MHD COVER STORY

NEW SOLUTIONS Beyond the technology platform, uTenant has added significant solution capability to the team in 2020, which has enabled them to run a number of additional services including formal tenders, market sense checks, RFQs and RFPs for their clients.

“Often businesses select a handful of parties to respond to tenders, RFQs and RFPs which may or not be the best fit for their business. There are hundreds of logistics providers across the country with different capabilities, cultures and services. One of the many challenges in the industry is that most logistics providers have a different charging mechanism or rate card which can be difficult and time consuming to decipher. Particularly in the 3PL world,” Kyle says. uTenant goes to market confidentially on the client’s behalf, engages their networks and speaks to the providers that are suitable based on the client’s unique requirements. “It is vital to invite the correct parties to a tender process from the start which, in turn, will aid in finding the perfect match and partner for growth,” Kyle adds.

Especially this year, supply chain leaders are under more strain than ever

dealing with the impacts of COVID19. uTenant’s aim is to provide much needed support, guidance and advice to allow the industry to focus on other strategic initiatives. Kyle says that uTenant’s Solutions Service will assist the wider industry with the right match for inbound, warehousing and outbound logistics that best suit their respective business strategies both now and in the future.

Finally, uTenant has experienced increased interest from logistics providers looking to make strategic acquisitions to bolster their capability and footprint Australia wide. This has been on the back of the start-up introducing two parties for a large acquisition in Melbourne earlier this year. Kyle says uTenant looks forward to building on this service further in 2021.

FUTURE GROWTH While it’s hard to disrupt industries like industrial property and supply chain which are somewhat set in their ways, Matt and Kyle are certain that the new way of sourcing property, warehousing and 3PL services will be welcomed in the industry.

As the industrial property sector develops, and retailers shift their

models further online the demand for industrial space is set to grow significantly over the coming years and uTenant imagines that their technology platform will be able to offer innovative ways for tenants to find new facilities.

In the foreseeable future that could be old run-down retail stores in central locations that are being transformed into mini warehouses or micro-fulfilment centres and uTenant’s efficient, cost-effective and transparent way of sourcing new warehouse space is set to play a central role in this shift towards flexible property options.

“We are adding value and doing the right thing for the industry. We intend to invest heavily in our technology in 2021 to make sourcing property, warehousing and 3PL services as easy as possible. We’re re-imagining a future with a new way for landlords to market their sites direct to tenants and how product owners find the right 3PL providers. We want to bring all three sides of the market together through our multi-sided platform.

The product owners and 3PLs (both tenants of industrial facilities) and landlords together in a one-stop shop for logistics,” Matt concludes. ■ MHD DECEMBER 2020 | 19

MHD MATERIALS HANDLING

Office Choice’s Simon Foster is thrilled with the 32-8FG18 forklift’s performance and equally impressed by TMHA’s after-sales service.

TOYOTA FORKLIFT ACES CUSTOMER SATISFACTION SURVEY Toyota Material Handling Australia has received an exceptional response from a happy client who recently completed a Customer Satisfaction Survey.

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ocated in Unanderra, South of Wollongong, New South Wales, Illawarra Office Choice acquired its first Toyota forklift, a, 8 Series gas-powered 1.8-tonne 32-8FG18 counterbalance, 18 months ago.

Since then, Illawarra Office Choice proprietor, Simon Foster, says he has been thrilled with the 32-8FG18 forklift’s performance and equally impressed by TMHA’s after-sales service.

Illawarra Office Choice is part of an Australian owned and operated group of independent local retailers, and is one of Australia’s largest B2B office suppliers, as Simon explains. “We are set up as a

marketing group of over 100 individual owners right across the country, with our head office in Melbourne handling our supply agreements,” Simon says.

“We have significant collective volume turnover nationally and with the buying power to compete with multinationals, yet we are locally owned and able to provide a more knowledgeable and personalised service, as well as giving back to local community.

“As ‘managers’ we also own the business, so we ensure the whole team go the extra mile for our customers to receive the very best service. In terms of service, we have a high degree of product

knowledge and help our customers with solutions that improve their business and make it more efficient. It’s not just simply ordering office supplies.

“We supply everything from office stationery and electronics to consumables, and right through to furniture. If we don’t stock something, there’s nothing too big or small that we can’t get for our customers - you might be surprised about some of the weird things we get asked for - so we’re a full one-stop shop and that makes life easier for our customers.”

Simon says he entered a long-term rental agreement with TMHA after MHD DECEMBER 2020 | 21

MHD MATERIALS HANDLING

finding that a forklift he inherited with the purchase of his business was unwieldy and unreliable.

“When we first took over the business there was a forklift from another brand already here but it was a dinosaur and a pain to use. We used it for about 12 months. It had regular breakdowns and was just too big for our warehouse space.

So, it was definitely time to replace it.

“I did a bit of research and found Toyota had a good reputation in the industry. I also have a friend who works for Toyota and I discussed it with him.

I considered a couple of other brands but, in the end, it was the obvious build quality and a name for reliability and durability that made going with Toyota a no-brainer. It also helped that we were able to try out a few different Toyota machines before deciding that the 8FG18 best-suited our business’ duties.”

TMHA Area Sales Manager, Paul Moujalli, says Toyota’s reputation for quality, durability and reliability (QDR) is a cornerstone of the Toyota Advantage.

“QDR is at the core of our values as a brand.

“Our forklifts are built using the same advanced manufacturing technologies as Toyota’s automotive products. The Toyota Production System is highly refined and employed the same way globally, ensuring every piece of equipment is built to exacting standards and resulting in high levels of QDR.” Illawarra Office Choice’s Simon says one of his biggest gripes with his former forklift was its large size and cumbersome operation. “Our warehouse aisles are pretty restricted so mobility in our small warehouse was very important.

“Our ex-forklift was clunky. Certainly a lot more cumbersome than the Toyota we replaced it with - a lot less manoeuvrable.

“Our Toyota forklift is a smaller machine - but it still lifts loads a lot easier than the old machine, and because its turning-circle is so small, we can turn it around in one go. So it’s a lot more efficient. Its mobility in our fairly cramped warehouse saves us time, making our work easier and increasing our productivity. In turn, that flows-on to how we can better-meet our customers’ needs.”

Another consideration for Simon his Toyota forklift’s inherent safety features.

“Safety is big for us,” he said. “We had 22 | MHD DECEMBER 2020

a situation with the old machine where one of the paper trucks air-levelled itself once a few pallets were taken off it. It lifted one part of the old forklift off the ground and the forklift didn’t correct itself, which was quite scary.

“The Toyota technicians went through the System Of Active Stability (SAS) system with me as part of the process of acquiring our machine, which was really reassuring.”

TMHA’s Paul explains that Toyota’s exclusive SAS is another key tenet of the Toyota Advantage. “As an automatic safety system, SAS is an indispensable feature for our forklifts and a huge part of the Toyota Advantage,” Paul 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.

“It is similar in concept to vehicular anti-lock braking systems and vehicle stability control systems in that it contributes to accident-prevention by detecting motion during operation.

“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.”

Simon says a long-term rental model suited his business because it simplified his costs. “A fixed-price package is much easier to budget for. We’re happy to know where we stand in terms of expenses through the long-term rental agreement.”

Likewise, Simon is pleased with the

service and support he’s received from TMHA. “Toyota’s support has been awesome.”

“We have our regular servicing where the technicians will come and make sure everything’s on track. They arrive on time, have all the parts, do their thing really quickly and get out of here. And because they work around our schedule, there’s no interruption at all to our business.”

When asked in the Customer Satisfaction Survey if he would recommend Toyota forklifts to other businesses, Simon provided the maximum rating of 10, saying “I would strongly recommend Toyota forklifts to anyone looking for any type of lifting requirements. I feel real value-formoney with fixed monthly expenditure including servicing and a machine that is 100 percent reliable, and that saves us time with its mobility.”

So happy was he about TMHA service levels, he skipped the Survey section “Because it doesn’t need any further improvement - I couldn’t ask for better service than we’re already getting,” he says.

Asked to cite favourite things about his Toyota forklift, Simon says reliability is a huge factor: “We’ve had the forklift for nearly a couple of years now and had no problems with it, whatsoever. It’s been 100 percent reliable.

“The other thing is that it’s so much more manoeuvrable. The efficiencies that brings is certainly one of the best things about it.”

So, it’s all in a day’s ‘office’ work for this 32-8FG18 Toyota forklift. ■

A long-term rental model suits Office Choice because it simplifys costs.

MHD SUPPLY CHAIN

TRENDS TO WATCH IN 2021 Raghav Sibal, Manhattan Associates’ Managing Director for Australia and New Zealand shares five key trends with MHD that will impact the local supply chain sector in 2021.

1. RESILIENCE AND FLEXIBILITY Advanced systems are key to delivering on flexibility and meeting customer expectations. Manhattan Associates customer, Super Retail Group, used the Manhattan Active Omni solution to accommodate major order and fulfilment changes within minutes as a result of COVID-19 disruptions within Australia (and Victoria specially) this year. With Manhattan, they were able to change their fulfilment logic so that orders that were going to be shipped out of Victoria were stopped when the lockdown measures were announced in that state due to its second wave of infections and they were able to re-allocate all pre-planned shipments out of Victoria within minutes.

Additionally, the system allowed Super Retail Group to deploy a ‘site outage’ action for both their DCs and stores so that if any site is unable to trade (such as due to a positive COVID-19 test or other reasons) they can quickly close that site and redirect order activity to be fulfilled elsewhere.

2. INSTORE EXPERIENCE NEEDS TO BE AS SEAMLESS AS ONLINE Australian consumers’ expectations since the pandemic began are sky high and their loyalty will be harder to attract than ever before. This means one bad experience or poor customer service interaction could see a shopper abandoning their purchase, or even the entire brand forever, and being sent straight to a competitor. Recent research shows that shoppers’ have high expectations that retail staff will be knowledgeable about all products and know when out of stock products or new products are due in store. Today the in-store experience must meet (or 24 | MHD DECEMBER 2020

surpass) the online experience with seamless, interwoven touches such as expert product knowledge and often acknowledgment and understanding of their digital behaviour.

3. RETAILERS NEED TO LISTEN TO THEIR CUSTOMERS AND TAILOR THEIR APPROACH A Manhattan survey of 2,000 Australian consumers and 100 large-end retailers, found that the largest group of consumers said they consider home delivery in 2 or more working days to be the most useful option when online shopping, whereas only 6 per cent of retailers said that this was the most popular delivery option with their customers. Almost 50 per cent of retailers said that Click and Collect in 2 plus working days was the most popular delivery option amongst customers, which contrasted with only 6 per cent of consumers agreeing that this was the most useful delivery option. A further 31 per cent of retailers stated that same day home delivery was the most common delivery choice with customers, however, only eight per cent of consumers consider this to be the most useful choice. These research findings indicate a major divide between what retailers believe is the desired delivery option, compared with what consumers really want or find most effective. This could mean that the delivery options retailers are offering today are not in line with consumer expectations, leading to unnecessary pressure on already stretched supply chains to deliver goods quicker than consumers actually expect or need them.

4. BUSINESSES CAN’T SELL WHAT THEY CAN’T SEE Recent Manhattan research highlighted an ongoing issue for retailers and

their supply chains. Only six per cent of Manhattan survey respondents indicated they have accurate inventory insight 100 per cent of the time. The biggest group of retailers said they only have visibility 26-49 per cent of the time, while another 36 per cent said they only have visibility 50-75 per cent of the time. Put simply, retailers can’t sell what they can’t see, and this concerning lack of stock visibility and supply chain visibility in general, especially when the bulk of retail activity is currently online, is risking lost sales opportunities.

5. ‘FULFILLING FROM STORE’ SHOULD BECOME THE NEW SUPPLY CHAIN ‘NORMAL’ The consumer behavioural shift to online shopping has increased the business case for an expansion of hybrid fulfilment methods that blend ecommerce and store resources. Hybrid fulfilment offers retailers increased flexibility enabling them to pivot, scale, adjust and respond to changes.

Fulfilling online orders in retail stores is a by-product of this new economy.

Customers enjoy picking up online purchases in local stores, which satisfies their insatiable demand for immediacy and flexibility. Further, ship-from-store is vital in an age where ecommerce orders are booming, and bricks and mortar operations are operating at much lower levels. It makes little sense for a retailer to ship a large electronics item from their Melbourne-based warehouse to Cairns, if that same item is already available in a retail store in large volumes in Cairns. Manhattan has technologies that support underutilised retail staff to handle store order picking, staging, packing, shipping for fast delivery and customer pickup. ■

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MHD SUPPLY CHAIN

CLIMATE CHANGE RISK Michael Beaumont, Group Manager, Account Engineering at FM Global presents the risks and challenges of a changing climate on global supply chains.

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upply chains have long hidden layers of risk which can come back to bite, no more than during COVID-19. As businesses look to diversify their supply chains it’s critical that they take into account a risk factor that may represent a greater long-term threat: the impact of the changing climate.

A changing climate not only creates a riskier and more challenging environment for humans to live in, it also means a risker and more challenging business climate.

A recent report by Deloitte Access Economics provides a glimpse of what’s at stake. ‘A new choice: Australia’s climate for growth’, notes that without taking action to address climate change, the economy will be six per cent smaller by 2070 - a $3.4 trillion lost opportunity over the next half a century. On the other hand, a $680 billion dividend awaits if Australia can rise to the challenge, along with 250,000 more jobs.

The report’s lead author, the Head of Deloitte Access Economics, Pradeep Phillip, described it as comparable to a pandemic happening year-onyear. “Climate change is no longer a possibility. It is a reality. Doing nothing is now a policy choice, and it is costly…there isn’t a ‘no cost’ option,” Phillips says.

STRENGTHENING SUPPLY CHAINS FOR A CHANGING CLIMATE A large part of the forecast business disruption associated with a changing climate relates to supply chain disruption.

With more frequent and severe natural disasters as a result of global warming and sea level rise, comes a significant increase in the risk for interrupted production, shipping, and increased costs throughout the supply chain.

A recent study by McKinsey and Company found that by 2040, a company using leading-edge chips such as an automotive Original

Equipment Manufacturer (OEM), sourcing from geographies in Korea, Japan, Taiwan, or other hubs in the western Pacific, can expect that typhoons sufficient to disrupt their suppliers will become two to four times more likely. Similarly, heavy rare earth production in southeastern China is predicted to experience extreme precipitation events twice as often by 2030, according to the report.

Vietnam, recently touted as one of the “low-cost manufacturing environments” that could benefit from a shift in supply chains in the wake of COVID-19, suffered some of the worst flooding in decades this year, as seven consecutive tropical storms and torrential rainfall affected more than five million people.

BUILDING KNOWLEDGE, PRIORITISING, DIVERSIFYING As a global insurance company providing risk mitigation advice to thousands of companies worldwide, including a third of the Fortune 500, FM Global recommends that businesses increase their knowledge about climate risks and how they are managed throughout their supply chain to improve resilience in the face of a changing climate. Armed with this information, they can make informed decisions about diversifying their most important suppliers or working with them on risk improvement.

START WITH A SUPPLIER IMPACT ANALYSIS Make sure to identify all suppliers that your business is highly dependent on – in a climate-related event such as flood, fire or high wind, no suppliers would be spared. Steps to analyse these impacts include: 1. Identify your key products and services and how much profit each generates for your business.

2. Determine how much each product or service depends on an individual supplier.

Michael Beaumont, Group Manager, Account Engineering at FM Global.

3. Convert the information from step one and two into profit supported by the supplier.

4. Add up all the profits supported by a supplier to get the total profit supported by that particular supplier.

With this, you will be able to develop a list of suppliers, prioritised by the degree to which the organisation is dependent upon them.

ASSESS SPECIFIC LOCATIONAL RISKS The next step is to assess the specific risks at these high priority locations.

Data-driven risk assessment tools like the FM Global Resilience Index provide invaluable insights to business executives on which regions, sites and business partners are most vulnerable.

Amalgamating data gathered by FM Global’s risk engineers who visit and assess risk factors at more than 100,000 client locations worldwide each year, with information gathered from sources such as the World Bank and International Monetary Fund, the Resilience Index assesses countries’ resilience by twelve core drivers, across three areas – Economic, Risk Quality, MHD DECEMBER 2020 | 27

MHD SUPPLY CHAIN

and Supply Chain.

The index’s Risk Quality factors are especially relevant for organisations looking to assess and fortify their supply chain in the face of potential climate vulnerabilities. These risk quality factors cover variables including a country’s exposure to natural hazards, natural hazard risk quality (largely linked to building standards) and fire risk quality.

Supply Chain factors, a category of risk which addresses elements such as quality of infrastructure, is another key set of data points to consider when making evaluations of potential suppliers. Lower quality infrastructure may be more susceptible to destruction and disruption in the event of a major natural hazard such as a bushfire, flooding or typhoon.

Climate risk assessments of your supply chain should also include national and international standards maps, local jurisdiction flood maps, consultants and insurer maps, to name a few. FM Global offers its own natural Businesses need to consider a changing climate and the risk it presents.

28 | MHD DECEMBER 2020

hazard maps for free on our website, including a Global Flood Map which allows organisations to assess the risk of flood - a key climate-risk related challenge - at any location worldwide.

Armed with these details, organisations can drill down to discover how much of an overlap there is between suppliers they are most dependent upon, and those who are most at risk. If risk levels are deemed too high, tools such as the Resilience Index or Flood Maps can help you determine locations and suppliers that might work as alternatives.

Doing a thorough review of a supplier’s business continuity plan (BCP) can also be an important way to get a better grasp of just how much risk you are subjecting your business to and whether your suppliers are taking adequate steps to mitigate it in the event of a natural disaster. As COVID-19 highlighted, whether or not a supplier has a BCP in place is not enough to ensure that the supplier will be able to deliver through a major disruption. You

need to actively seek to determine how effective their BCP is.

Engaging risk consultants to conduct an on-the-ground risk assessment is one important way to get a better grasp of just how much climate-related risk you are subjecting your business to, as well as whether key suppliers are taking adequate steps to mitigate it in the event of a natural disaster.

FM Global will often send engineers on-site at suppliers’ facilities to do an in-depth analysis of each exposed location. These take into account local flood studies, location topography, suitability of construction to resist common natural hazards such as winds, flooding, bushfire and more and may be used to make a final call on whether you cut ties with a supplier, or work with them to strengthen their resilience.

Climate risk may have the potential to cause disruption on the scale of a pandemic but building knowledge and resilience through data-driven tools can help vaccinate your business against avoidable risk. ■

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MHD TECHNOLOGY

SIMPLIFYING THE QUOTE TO CASH PROCESS

A global organisation devoted to building software to help businesses succeed has recently partnered with one of Australia’s largest forklift providers. MHD reports.

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he quote to cash process is an end-to-end business process that covers the entire customer lifecycle, including sales processes, order management and billing.

In today’s fast-paced economy, the quoting process has moved beyond the basic functionality of a spreadsheet and customers expect comprehensive and prompt quoting practices from their suppliers.

James McDougall, Business Development Manager at Cincom, a global software solutions provider, says business has largely become a first in, best dressed scenario. “Those who can quote quickly, accurately and efficiently are seeing the strongest sales conversion rates,” he says.

With this in mind, many businesses are looking for efficiencies in the quote to cash process so they can shorten the time they need to get back to their clients.

Cincom is a global leader in configure-price-quote (CPQ), its solutions are geared towards enhancing organisation’s capabilities, optimising processes and delivering a better experience for customers.

With a mission to ensure that its customers are able to win and retain more business, Cincom has a suite of software solutions that are designed to 30 | MHD DECEMBER 2020

help businesses operate more efficiently and effectively.

“Organisations are increasingly timepoor, by streamlining the quote to cash process we remove the low-value tasks of repetitive and mundane processes so that sales reps can focus on higher value tasks such as building and retaining good business relationships,” James says.

The software also enables organisations to have better control of pricing and the ability to cross sell or upsell complementary products with ease. It’s customisable and flexible whatever the sales process and is designed to reduce complexity.

“Whatever sales channel you use, our platform will streamline the entire process so that you don’t have to go through three of four types of processes to get to the same end-goal.

By doing this, you can significantly reduce quote times as well as inaccuracies,” James says.

Cincom has been proven to reduce quote times down from weeks to days or even hours, James says. Furthermore, if a sales model changes it is easy for the platform to adapt.

Additionally, James says that one of Cincom’s strengths is its ability to service customers locally in Australia.

“While we are a global company, we are invested in this region. We have service support based here in Australia and we can support our clients with personal and tailored support on the ground.”

Operating across a breadth of industries, Cincom has extensive experience in the logistics and transport industry and works with industry heavyweights such as MAXITRANS and Toyota Material Handling Australia.

Toyota Material Handling Australia (TMHA) recently selected Cincom CPQ to improve its sales effectiveness and efficiency by automating and streamlining the pricing and quoting of its products and services.

Cameron Paxton, Vice President and COO at TMHA says after an exhaustive process of reviewing various solutions, Toyota selected Cincom due to their alignment with their values, especially in regard to their appetite for kaizen or continuous improvement.

Cincom and Toyota met at transport and logistics expo MEGATRANS last year and according to James, Toyota were impressed with Cincom’s commitment to the materials handling industry.

Toyota was finding it difficult to find a solutions partner who could quote on both rental and purchase options for its clients.

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“The ability to configure the application and show both options such as lease and purchase was a major priority for Toyota,” James says.

With Toyota offering hundreds of products and services, configuring, pricing and quoting is a challenge and the business had been using an

in-house configuration tool created by a dealership it acquired more than 24 years ago.

Cameron Paxton, Vice President and COO at TMHA says that the front end of this inhouse solution was fine in allowing them to produce accurate and timely quotations for customers, however as it had been designed for a dealer, not an OEM, so it had limitations particularly in the back end support.

The system also lacked integration with TMHA’s ERP, leading to double handling and processing.

With hundreds of models of forklifts, as well as sweepers, scrubbers, tow tractors and more there can be more than 100 possible pricing configurations so Toyota required a more comprehensive and smart solution.

By selecting Cincom, Toyota will have a higher back end functionality and will be able increase accuracy and time with its quotations and pricing. “At the moment the front end is very, very quick, so we will maintain that. But the back end, which will mean it is more accurate, will increase, and it will cut days off our

processing times. If there is a change that needs to be affected, instead of it taking potentially weeks, it will be done within hours,” Cameron says.

It took five years for Toyota to find a solution before selecting Cincom because of the lack of options around software that could include both rental and purchase options “We believe that Cincom CPQ will serve us into the future and as such, we need a partner who will stand the test of time and be devoted to helping us to continue to integrate and refine our processes. We believe Cincom can and will provide that degree of engagement,” Cameron says.

James says that Cincom’s point of difference is its commitment and support it provides to its customers and this was a huge factor in TMHA selecting Cincom and throughout COVID-19 Cincom has been able to provide Toyota with the support and customer service needed to introduce a new software solution during one of the most challenging times for businesses around the world. ■

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MHD TECHNOLOGY

Ferag’s equipment is engineered and manufactured in Switzerland.

HOT OFF THE PRESS From distributing newspapers at record speed, Ferag has switched gears to aid the rapidly growing world of e-commerce. MHD sits down with Philip Batty, Managing Director of the company’s Australia-New Zealand arm to find out more.

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he printing industry is logistics at its best. Churning out thousands of catalogues and newspapers to specific postcodes overnight so a reader wakes up with colour pages in their hand first thing in the morning. When it comes to the sorting of items, especially with same day e-commerce deliveries, materials handling joins printing as one of the most time-critical industries to operate in.

The printing press began operating a seamless next-day delivery model

before e-commerce and logistics giants like Amazon and Catch. Philip Batty, Managing Director at Ferag Australia says that since 2014 Ferag recognised that there were many synergies between the printing industry and the materials handling industry and as such has begun expanding into this area.

Founded in 1957 and headquartered in Switzerland, the company is highly regarded as the world leader in the development, manufacture and marketing of post press processing

Ferag’s Denisort is a modular tilt tray sorter designed for the sortation of items with a weight of up to 12 kilograms.

32 | MHD DECEMBER 2020

systems. “In Australia alone we have installed over $300 million worth of equipment in the printing industry.

So as much as we have adapted to the intralogistics landscape, our technology has been well established for over sixty years,” Philip says.

THE RAPID IMPORTANCE Manual sortation is the way of the past, not to mention, labour intensive. “In e-trade businesses, picking is a vital component to harmonising a smooth operation. But as you finish picking, you also need to sort at rapid speed,” Philip says.

According to Philip, most businesses get to a point where their volumes of parcel’s per day are at a level where manual sortation risks human error at significant cost.

Last financial year, over 2.8 billion Australia Post items were processed and delivered to 12.3 million delivery points across Australia. “Manufacturers, e-commerce giants, courier services and other e-trade businesses are catching up to Australia Post in terms of consumer demand for delivery. With the increase of volume across the entire Australian delivery network, rapid sortation has never been more crucial,”

MHD TECHNOLOGY

Philip says.

Optimisation is a key process in intralogistics, especially in sorting items. Many businesses are facing the challenge of an influx of outgoing orders to multiple destinations. “If you’re able to pre-sort parcels into logical areas before it begins the lastmile distribution process you are ensuring improved accuracy and cost efficiency,” Philip says.

MOVEABLE SOLUTION Ferag’s Denisort is a modular tilt tray sorter designed for the sortation of items with a weight of up to 12 kilograms. Philip highlights the total freedom in configuration and fast installation result in a powerful, compact and flexible system for maximum output on the smallest footprint.

“It’s perfectly tailored for a variety of applications, such as CEP services, e-commerce, retail, B2B and 3PL,” he

says. The intended purpose of Denisort includes the sortation for dispatch, goods in, returns, cross-docking and rest mail.

Ferag’s equipment is engineered and manufactured in Switzerland and the business prides itself on its quality and commitment to innovation. “Ferag is a family-owned business and has been since its inception more than 60 years ago,” Philip says.

Philip’s appointment is part of a larger strategy to commit and develop Ferag’s market share in Australia. “Through my expertise of understanding the Australian market and its growing capabilities, the Denisort is ideal for say a thirdparty logistics provider as it can be repurposed for an alternate customer at the end of a specific contract,” he says.

Philip highlights that It’s a costeffective solution that is modular and also moveable. “This can be hugely beneficial when you compare this to other sortation solutions that are not modular. The compact version of the Denisort is also ideal for a customer who needs to do smaller size sortation.”

CHAINED IN UNISON Denisort is a linear sortation system.

The technology has been innovated from printing processes that Ferag has implemented for decades across the world. “This solution is definitely ideal for short duration projects, urgency in sortation capacity, and a lower cost and simple system,” Philip says.

Furthermore, many businesses in the e-commerce sphere are emerging and young to the game. “By partnering with a trusted provider who has been developing technology for almost a

century, it not only provides peace of mind but is a low investment that is trusted and proven within the industry on a global scale,” Philip says.

He highlights in today’s market, there are endless opportunities with automation and system providers to improve processing on the operation’s floor. “However, where the major Denisort difference lies is in its drive technology. Quite often the operation will only require one motor to drive the entire system as it is one continuous chain that works in unison,” Philip says.

The chained link works in one piece which Philip credits as a major advantage for sorting processing.

“Having the chained drive provides a very flexible design and is low power consumption, less noise and all round simple and highly efficient.”

Denisort can also be customised to the facility it is being fitted into. “The one thing that is actually unique is that the system can travel across multiple floors,” Philip says. As facilities maximise space and utilise warehouse height to operate floors of product sorting, Denisort can be flexible, even in older traditional multi floor factories. “Without having elevators or other associated equipment, the sorting process can stay on one chained conveyer across levels in a particular facility,” Philip says.

“Difficult modifications are unheard of with this system. Sorting items in logical areas through its compact and modular design make it easy to expand as business grows too. Ultimately, the low maintenance and flexible configuration is ideal for the bulkiest and most sensitive products.” ■

MHD DECEMBER 2020 | 33

MHD TECHNOLOGY

The JIVARO is a machine that reduces the height of packages to adjust them to the volume of the products they carry.

INNOVATIVE PACKAGING CONCEPTS James Schmidt, Engineering Manager at Sam Technology Engineers shares how the company’s partnership with an international supply chain solution is changing the game for Australia’s e-commerce automation.

T

he personalisation of shipped packages is one of the big trends in intralogistics packaging, with requirements in e-commerce, B2B distribution, and 3PL. Thanks to partnership with companies all around the world and local engineering development, SAM Technology Engineers has partnered with Savoye, a French designer and manufacturer of automation technologies for warehousing and distribution systems.

This includes picking , distribution and packaging modules and systems.

The JIVARO is a machine that reduces the height of packages to adjust them to the volume of the products they carry, and due to the growing consumer demand for online goods

34 | MHD DECEMBER 2020

in Australia, the unit is well-suited to e-commerce needs. Every package prepared is identified at the input so that the appropriate lid can be selected, to satisfy the needs of multi-brand logistics platforms, for promotional offers, or simply to increase the machine’s standalone operating capability.

“Essentially, if a consumer orders one item and the box is fairly large, the machine will cut the box down and fold the lid over. This means the dispatcher isn’t paying extra freight costs by reducing the volume,” James Schmidt, Engineering Manager at Sam Technology Engineers says. “ We have installed the order start and end of line packaging systems into existing

materials handling systems as the end user has seen the return on investment due to changes in the market. Currently we are using the JIvaro machine with standard second hand and new cartons for one customer” SAM Technology Engineers has been engineering products and services to several industries and have developed a specialty division named Automated Warehouse Solutions, specialised into logistics and distribution of pharmaceutical, food, beverage and general warehousing. Sam Technology has specific relationships with equipment suppliers from Europe, including Savoye in France, that allows Australian businesses to leverage solutions that have achieved success

MHD TECHNOLOGY

“

We have installed the order start and end of line packaging systems into existing materials handling systems as the end user has seen the return on investment due to changes in the market.

in international markets. With more than 1,000 units sold worldwide, in more than 300 distribution centres in Europe and North America, the JIVARO and PAC600 series automatic carton packaging machine is fully market- proven.

James says JIVARO and PAC600 is an innovative packaging concept due to its sizing carton height. The Jivaro closing machine automatically modifies box height to match

”

the volume of packed items. Customising the height of shipping cartons ensures items are securely packed and ready for safe delivery.

Jivaro minimises and eliminates the need for additional cushioning material.

INTELIS JIVARO can adjust sealing height according to the volumes of actual articles without dispensing extra fillers, which minimizes shipment size and maximizes loading rate by as high as 100 per cent. With the aid of automatic sealing and capping, parcels have a steadier geometric structure, and paperboard consumption is reduced by 7 per cent by saving the adhesive tape.

“What’s interesting is that this machine was developed for stationary and now being utilised for consumer goods including clothing, medical and cosmetic products,” James says. He notes that a lot of cosmetic goods can be damaged in the shipping process due to unsecure and oversized packaging. “If they jiggle around in a larger box, the packaging and product can be damaged. The extra packaging cost for fragile items like cosmetics can be very expensive so stopping the movement and presenting customers with a well-polished package on arrival is vital in this online shopping era,” James says.

He says Sam Technology is always looking for unique solutions for the warehouse and logistics sector. “We find products that provide solutions to customers. We specialise in bespoke engineering solutions that allow a high return of investment and enhance operational efficiency. We are also locally developing and designing bespoke solutions wth these technology transfers ” James says. ■

BAC SYSTEMS PTY LIMITED 193-195 Power Street Glendenning NSW 2761 Phone: (02) 9832 2777 Fax: (02) 9832 3899

Order now the latest BAC catalogue online!

www.bacsystems.com.au

BAC Modern Industrial Storage Solutions

Support Australian made innovation!

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MHD DECEMBER 2020 | 35

MHD SUPPLY CHAIN

ADVANCING THE SUPPLY CHAIN

Through subject matter expertise and a hands-on approach, Bastian Consulting is dedicated to finding the right leader for the right role across the supply chain. MHD finds out more.

T

he types of skills and capabilities needed to lead supply chain divisions around the world are changing drastically. COVID-19 has accelerated this pace of change and digital technology is playing an increasingly central role in today’s economic development debate.

Tony Richter, Founder of Bastian Consulting, an Asia Pacific supply chain recruitment agency, has a background in operations and supply chain. With a Master’s degree in Supply Chain Management, Tony draws on his extensive knowledge of the industry to find the right candidates for the right roles across some of Asia Pacific’s largest companies.

“We have that extra level of experience and technical knowledge that enables us to find the ideal candidates for our clients. We do this by getting an understanding of our client’s requirements and then articulating the capabilities and skills they need to facilitate

“

In supply chain you need people who can interpret data, understand what the problem is and what the actionable insight from the data is. It’s about a combination of operational and technology-based skills.

” Tony Richter, Founder of Bastian Consulting.

36 | MHD DECEMBER 2020

their key projects and goals. We usually can turn around projects quite quickly through our connections, referral partners and knowledge of the industry,” Tony says.

Bastian Consulting is a boutique recruitment agency that is focused on sourcing leaders that can deliver change.

Bastian Consulting’s specialism is in the value chain domain and with over ten years’ experience spanning across APAC, Tony and his team have built up a great reputation across the industry.

Tony says the business typically places roles across the entire supply chain while recently they’ve seen a clear demand three key areas including e-commerce, advisory and technology.

With regards to e-commerce, the rapid acceleration from bricks and mortar due to COVID-19 has put the pressure on many organisations who were lagging behind. “A lot of retailers have some catching up to do and its imperative they find the right talent and skills in this area,” Tony says.

Technology is also a huge area of growth for supply chain. “A few years back the

MHD SUPPLY CHAIN

Capabilities and skills around technology are also in high demand in the supply chain.

vendor selection process in supply chain was quite simple. You would assess three to four vendors and make a decision. But now, there are 100s of specific solutions and providers so making the right decision is much more complex,” Tony says.

Capabilities and skills around technology are also in high demand in the supply chain, and Tony says this is only set to increase. “In supply chain you need people who can interpret data, understand what the problem is and what the actionable insight from the data is. It’s about a combination of operational and technology-based skills,” he says.

COVID-19 has driven more organisations to prioritise resilience and explore different ways of working such as onshoring. However, this comes with its own unique challenges.

“The rhetoric around onshoring poses a number of different challenges that will need to be overcome. It’s expensive to find the right people and we also

haven’t had significant manufacturing in this country for a long time, so it will be about increasing skillsets and bringing back knowledge and competencies that may not currently be in the workforce,” Tony says.

This also presents an opportunity for automation and technology such as Artificial Intelligence (AI), blockchain and the Internet of Things (IoT).

“We’ve seen a lot of blue-collar roles being automated with conveyor sortation systems, automation, mobile robots etc. But I also think that we will see more white-collar roles becoming automated through smart technology such as AI for those decision-making processes,” Tony says.

While strong leadership roles in the supply chain are generally hard to fill, Tony and his team operate a traditional headhunting model.

“We don’t advertise roles. We will look at who your competitors are, and we will target them. We will look at which organizations have gone through

similar transformations. We run a targeted search for each assignment we work on,” Tony says.

From here Bastian Consulting works through a technical and behavioural assessment process before presenting a candidate to a client. However, Tony says the key to finding good candidates is to be transparent and set expectations from the get-go.

“We run recruitment processes like a project, we have clear dates of when we will deliver and when our candidates can expect to hear an outcome.”

Many inhouse recruitment processes are outdated and take too long, which leads to organisations missing out on quality candidates.

“Many candidates know their worth, so if a business drags their feet they tend to miss out,” he says.

Bastian has worked with some of the largest supply chain organisations across the Asia Pacific market including Toll, TM Insight, eStore Logistics and Manhattan Associates. ■ MHD DECEMBER 2020 | 37

MHD TRENDS IN IOT

BROUGHT TO YOU BY

UNLOCKING OPERATIONAL EFFICIENCIES As the supply chain industry regroups post COVID-19, the common themes are centred around resilience, flexibility and control. With IoT well-placed to transform the supply chain, there are significant operational benefits to be realised with this accessible and mature technology.

By Loic Barancourt, CEO and Co-Founder of Thinxtra

A

t the centre of the Internet of Things (IoT) technology is its ability to offer more control and visibility. With COVID-19 sending shockwaves through the global supply chain network, real-time data insights about location and condition of shipments or assets are needed now more than ever to make better informed decisions.

Resilience and efficiency will be the crucial values in the next normal post COVID-19, and cost control is more critical than ever. Disruptions caused as a result of a lack of visibility across the supply chain ultimately lead to unplanned costs and serious operational issues.

IoT devices are typically connected to computer systems via IoT networks.

38 | MHD DECEMBER 2020

By increasing visibility and control, you can minimise these costly disruptions well before they occur.

If you can know where your assets are throughout the working day as they move through the supply chain, , as well as what condition they are in, then you can pre-emptissues that may arise as a result of lack of transparency.

When we founded Thinxtra, The IoT Telco, our mission was to accelerate the adoption of IoT, to unlock large efficiency gains while building more sustainable business practices. Our vision preceded COVID-19, but the fundamental benefits of IoT have never been more relevant.

WHAT IS IOT? While there is a lot of mystery around new technology such as IoT, in its simplest form IoT is a collection of interconnected physical devices that can monitor, report on and exchange data.

Simply put - with IoT you can ask your assets ‘where are you’ and ‘how are you feeling’ and then use that information to make them work smarter for you IoT devices are typically connected to computer systems via IoT networks.

In the case of Thinxtra, we have built the 0G IoT Network infrastructure in Australia, New Zealand, Hong Kong and Macau. This network is part of the global 0G Network, powered by Sigfox technology, a low power, wide area network (LPWAN) that reduces the cost and effort of deploying IoT solutions at scale, locally and globally.

This enables a plug and play scenario, whereby once you are ready to track your assets the public network is already established and ready for you to connect.

Furthermore, the decision to build and operate the 0G Network was a strategic choice for Thinxtra, driven by the fact that we knew that across the supply chain there are hundreds and sometimes hundreds of thousands of assets need to be tracked daily, and could not be connected over the 4G/5G networks due to cost and battery-life issues.

But when we say need to be tracked, we mean that you need to know where they are maybe once, or twice a day.

Rather than a constant stream of information that is not adding value.

For example, take roll cages. You may lose hundreds of these across your network every year. But if you could have access to real-time data once a day about where all of your roll cages are located across your network, you virtually eliminate the chance of losing them.

The 0G Network offers a never-before realised cost effective way to track low and medium value assets across the supply chain.

As opposed to 4G or 5G networks, that usually provide a constant, high volume stream of information and therefore require a large amount of power and bandwidth, the 0G Network provides a cost-effective way to track assets once or twice a day and can boast battery life of many years, often up to seven years.

The 0G Network still allows for tracking location, movement, temperature, humidity, shock and many more parameters, but the amount of times a day this data is communicated makes the case a compelling, affordable and operationally viable one. This makes the technology ideal for roll-cages, trailers, drums, beer kegs, containers and even pallets who need to be tracked over years.

IS IOT TOO EXPENSIVE?

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The 0G Network offers a neverbefore realised cost effective way to track low and medium value assets across the supply chain.

”

The simple answer is no, not anymore. With the 0G Network, you can track a high volume of assets, seamlessly and globally at a fraction of the cost of 3G, 4G or 5G technology.

The question you need to ask yourself is what do I really need to get out of my assets?

For low value assets, that is usually just where they are located and in what condition and in terms of frequency, maybe once or twice a day.

What may at first seem like a small amount of data, in reality offers huge operational benefits. If you know where your full fleet of assets is, every single day, you can achieve next level of control and flexibility to manage your supply chain operations.

Furthermore, by utilising Thinxtra’s 0G Network the set-up cost is much lower than at first appears when all you need is the devices, connect them to the public network and integrate the data in your systems and processes to monitor them.

We’ve seen businesses realise an ROI in a matter of months, with loss ratios down, utilisation increases, waste reduction and a boost in staff productivity.

THE NEW WAY

WHAT’S NEXT?

While tracking is not new, with technology like RFID and barcodes now commonplace in the supply chain, the business objectives of being able to have more useful data on a regular basis, as assets move between locations, can be realised with IoT. It is now also possible to monitor the condition of goods as they move, for example temperature, humidity, shock or water leakages. By combining location with condition data, a whole new range of valuable data insights can be created for all supply chain partners.

RFID and barcoding are reliant on manual processing and scanning. You only know where your asset is based on the last time it was scanned. Furthermore, manual processes around data capture and reporting often follow with these kinds of technology. But with IoT, the data is automatically uploaded digitally to the cloud and can be integrated with any systems This more traditional practice is also limited by location. You can track the location of something at one location, but you can’t track that movement. So, if you lose something along the way, or it gets left at the wrong depot, you have no idea where that happened across the supply chain. With IoT, you have a regular flow of data so you can limit losses and damages.

Joining the IoT journey is easier than you think. All you need is a business issue you need to solve through accurate data, and we know there are many of these.

If you don’t know where your assets are, your business is constantly at risk. With IoT you have peace of mind that you have complete transparency and control over your entire network.

The 0G Network provides the perfect opportunity to scale the technology across an entire fleet network, providing benefits across a nationwide or international supply chain.

Once installed, you can realise the benefits of IoT for many years, oftentimes up to seven years with minimal disruption or maintenance. This has been strategically developed to coincide with the lifespan of many assets in the supply chain such as IBCs, pallets or roll cages.

As we move further towards a sustainable future, IoT technology is set to play an increasing role. By being able to track where your assets are and limit loss, you can operate a much more lean and green business model by reducing waste and cutting emissions.

We live and breathe IoT and we are excited about sharing the operational, sustainable and cost benefits of the network and technology that we have developed with you. ■ MHD DECEMBER 2020 | 39

MHD SUPPLY CHAIN

THE WORLD IN 2021 After a year of disruption, challenge and uncertainty, MHD looks ahead to 2021 and asks leaders from across the supply chain spectrum what they think the industry needs to watch out for next year.

GARY STARR, EXECUTIVE GENERAL MANAGER BUSINESS, GOVERNMENT AND INTERNATIONAL AT AUSTRALIA POST This has been an extraordinary year for the supply chain and logistics industry, and while it has been stacked with its share of challenges, it is important businesses don’t lose sight of the opportunities that came with it, and use what they’ve learned to further strengthen their business plans and inform their strategy.

Operating in the uncertain environment that the pandemic has created has meant that the way supply chains and logistics are managed has been, at times, a day-to-day proposition. As business owners look to next year, they should seek to embed greater resilience into their operations.

While the interconnectedness of supply chains presents challenges, businesses of all sizes need to be adaptable in order to minimise flow on effects in the event their supply chain is impacted by a crisis or other issue.

What 2021 brings still remains to be seen, but what is certain is that the impacts of the disruption that 2020 brought will continue for some time, as will the lessons, better equipping us for any future challenges. ■

HAYLEY JARICK, CHIEF EXECUTIVE OFFICER AT SUPPLY CHAIN SUSTAINABILITY SCHOOL The events of the last year accelerated evolution on many fronts. If you do not see it in 2020, look out for this in 2021: Value beyond profit We measure value with more criterion than ‘profit’. Expect to see more metrics used to measure alignment with UN Sustainable Development Goals, Science-Based Targets, focus on social licences to operate, ethical sourcing, social procurement, climate action, diversity inclusion respect, and health & wellbeing.

Collaboration over leadership The ethos of multiple players developing and maintaining unique processes and systems is disappearing, and the emergence of entities efficiently collaborating to create one superior shared solution has begun. Expect to see more vertical integration, deeper relationships between customers & suppliers, increasing process and operational transparency, circular economy, resource efficiency, flexibility, technology replacing labour, global partnerships, and local manufacturing security of crisis triggered goods.

Management over mitigation The past is no longer the best predictor of the future. It’s no longer perceived as feasible to foresee and mitigate risks to businesses; instead, we need to be able to quickly identify and manage risk when it impacts us in a resilient way. Expect a tone shift with ‘disruption’ now seen as an efficient trigger for continuous improvement. ■

40 | MHD DECEMBER 2020

MHD SUPPLY CHAIN

BJOERN JOHANSSON, MANAGING DIRECTOR AT KUEHNE+NAGEL AUSTRALIA If 2020 has taught us anything, it is to be prepared to pivot and that there are always new opportunities if we look close enough.

The ramifications of COVID-19 and subsequent change in commercial practices will be with us throughout 2021. Over the next year, we should see shifts in trade parameters, opportunities in e-commerce markets and businesses rethinking their supply chain strategies. The logistics industry continues to play a vital role in keeping economies moving and ensuring that the global flow of goods is unhindered. We see significant opportunities for implementation of new technologies and potentially focusing on increased investment in fields like automation.

Spending habits have shifted with a significant focus on e-commerce and consumers will continue to opt for online shopping over traditional bricks and mortar stores out of convenience and continued concerns surrounding COVID-19. Having real-time visibility, increasing freight speed times and accurate data is especially critical to building a resilient supply chain for e-commerce businesses. ■

DR JOHN HOPKINS, INNOVATION FELLOW AT SWINBURNE UNIVERSITY OF TECHNOLOGY This year has been a year of resilience, as the sudden and unexpected impact of the COVID-19 coronavirus has tested supply chains on a global scale. It brought manufacturing to a standstill, and caused months of unpredictability, for the movement of products and parts around the world. For some this impact has been extremely damaging, even fatal, for others it has delivered exciting new opportunities, with the word ‘pivot’ reaching new levels of popularity.

With that in mind, 2021 is likely to be a year of recovery. Investment in automation and digitalisation will accelerate, not only as mechanisms for driving cost-savings, but for risk mitigation to future threats. Nearshoring will also be discussed, as political uncertainty and mounting tariff threats cause organisations to rethink their over-reliance on China and explore less risky options.

Online retail has been one of the big winners this year and will continue to build upon this success in 2021, requiring a readjustment of supply chains to service the growing ecommerce market. Demand for big data and artificial intelligence skills in the supply chain profession will increase, and many supply chain professionals will continue to work from home, at least some of the time. ■

KIRK CUNNINGHAM, CEO AT AUSTRALIAN LOGISTICS COUNCIL In 2021, ALC will push for closer industry and government consultation built off the COVID response. Governments and industry worked closely to ensure freight moved efficiently across state borders while confronting and controlling the spread of COVID-19. We want to maintain this momentum, with the partnership between industry and governments delivering smart solutions to problems and real time responses to opportunities.

This will include developing policy and infrastructure to support rapid advances in technology from automation and electric delivery vehicles to data capture and analysis.

The data piece, including adoption of national data standards and a national data hub, is crucial. Strong data leads to better policy and infrastructure choices including in urban planning and with the long-term preservation of freight lands and corridors.

The City of Canning is already partnering with local supply chain companies to capture real time data on truck movements to better understand, and then fix, slow points in the system. The way of the immediate future. ■

MHD DECEMBER 2020 | 41

MHD SUPPLY CHAIN

CRACKING THE LAST-MILE Last-mile delivery constraints are increasingly affecting logistics providers. Peter Ristevski, Dassault Systemes Consultant reveals how the challenge of diverse delivery locations, autonomous vehicles and future obstructions can be solved.

E

-commerce has disrupted the global supply chain and transformed industrial transportation networks. To meet demand, companies are looking for a faster and more efficient way to ship goods to consumers.

Whilst consumers are met with their expectations by retailers, the surge in online shopping has put pressure on logistics operations, particularly for the last mile, the final and crucial step in delivery from the distribution centre or warehouse facility to the consumer.

So how can companies get goods to consumers faster and more efficiently when road freight carriers capacity is limited and potentially costly? Peter Ristevski, Industry Process Consultant at Dassault Systemes, says planning is key in times of disruption. COVID-19 has put disruption at the forefront, uncovering vulnerabilities in supply chains, affecting the capacity to fulfil last-mile solutions.

FUTURE OF LAST-MILE At the time of the interview with MHD, Peter says two delivery drivers had approached his home this morning from the same courier service. “The orders I had probably came from the same DC and shows the emphasis on urgency in the logistics sphere right now to get orders dispatched fast,” he says.

According to global research by a US-based research company, the autonomous last-mile delivery market, including both aerial and ground-based vehicles, is expected to grow at a rapid rate in the next seven years. However, an increase across all e-commerce markets in B2B, B2C and C2C has already rapidly increased the need for urban freight and put a spotlight on the challenges around the time sensitivity of freight deliveries.

42 | MHD DECEMBER 2020

Retailers have had to shift their operations to meet consumer demands.

“Covid has definitely magnified the era of the new consumer. This demands a greater fulfilment service and flexible delivery options for the consumer,” Peter says. Recent research from Roy Morgan has found that nearly one third of Australians are working from home, which has changed the landscape for ‘traditional’ delivery methods as more people explore adaptable options for their goods and services.

“People can receive deliveries at any point of time and are available around the clock. Retailers have had to shift their options to meet their customers’ expectations,” Peter says. On top of that, is the time sensitivity to delivery dispatched from the warehouse to the home. Orders are tracked and any form of delay, no matter how small, leaves a sour taste in the consumer’s mouth.

These forms of difficulties presented in today’s market are challenging the operational abilities of logistics providers for retail and retailers.

The future of last-mile ensuring an array of delivery options are available, but also sustainable. Peter says in order to cope with the future of lastmile solutions and face the challenges, retailers must begin with a better plan, adjust and ultimately be more agile across the supply chain landscape.

“Retailers need a plan that is flexible as

the current diversity of deliveries. The timing of the consumer and the everchanging environment of the consumer requirements need to be accounted for in an adjustable manner,” Peter says.

DELIVERY PLANNING E-commerce relies heavily on the trucking industry in the form of longhaul transport, then regional and urban transfers, and then finally the last mile, which is usually completed with vans and app-based delivery services.

The boom of e-commerce and with it, distribution and last-mile logistics, has been noticeably affected by transport.

An increase in the number of road freight carriers is leading to greater traffic congestion and costly delays in the delivery of goods to end users.

This is why e-commerce home delivery planning is essential in the advancement of technology for managing complex supply chains that operate across various modes of transportation.

There are plenty of companies who offer planning as part of their solution, Peter says that focus isn’t entirely fixated as it should be. With world record breaking DELMIA Quintiq, Dassault Systemes is able to provide advanced home delivery planning from the first to the last mile.

Peter says it’s a planning solution

MHD SUPPLY CHAIN that matches the detail of your home delivery operation using a Virtual Twin Experience. “Instead of a black box optimizer full of obsolete data from an original implementation, the solution uses optimization that continuously considers all constraints of the business and requirements of the store or consumer such as, pickup and delivery time windows, driver rest times, employee agreements, skills and qualifications etc. for any planning horizon including the day of operation. This now unlocks ways for planners to make faster and better decisions to execute plans collaboratively with constant feedback from drivers out on the road through a driver supported app,” he says.

Further, the route planning is based on advanced mapping data with high resolution and global coverage. This allows for a single control tower connected to transactional systems (TMS, WMS, ERP etc.) for the efficient flow of enterprise information between planning and fulfilment.

“We’ve found that black box solutions don’t cater well for what happens next in the world of disruption. Our planning solution matches store delivery, home delivery for consumers and models your network through the information that is absorbed and streamlined through the system,” Peter says.

Retailers are able to ship products to the consumer, to a delivery point of their choosing, in a time slot of their choosing, while keeping them updated and informed. Peter says the solutions enables last-mile logistics of the future with flexible fulfilment models and dynamic delivery models for savings in actual transport costs. “The technology allows you to have that decision-making support at all times with real time KPI’s to show.”

INBOUND & OUTBOUND OPTIMIZATION

E-commerce relies heavily on the trucking industry.

“

Our planning solution matches store delivery, home delivery for consumers and models your network through the information that is absorbed and streamlined through the system.

”

As e-commerce continues to skyrocket, retailers will see all types of properties to be converted to last-mile distribution and

The surge in online shopping has put pressure on logistics providers.

delivery stations where goods can make that final trip to the front door. Solution providers like Dassault Systemes are constantly evaluating how to streamline delivery from wherever point A is to the end consumer, whether that be a DC, retail store or clickand-collect.

To compress costs and connect this growing network of facilities, Dassault Systemes DELMIA Quintiq solution for Inbound and Outbound Optimization provides fast and on-demand decision support for planners and drivers regardless of the planning horizon.

Peter says this advanced planning optimizes store replenishment delivers, making efficient use of logistics resources.

“The delivery plan is optimised to minimise the number of trips needed and to make use of return journeys to make collections from suppliers,” he says.

Planners use real time KPI-focused reporting tools along with automated capabilities to implement the ideal delivery strategy that assist’s lowering costs of transports and order fulfilment. “Essentially, it’s a key tool that enables flow optimisation between suppliers and DC’s and DCs to stores with retail special rules and load types whilst working within the operational constraints of the supply chain,” Peter says.

Globally, major organisations have implemented this solution to transform their well-established delivery network. “In Europe DHL efficiently supplies their evolving network and they reduce the distance in delivery time by 8 per cent. They increased their driver retention and the reduction in delivery time came from optimizing the driver’s route and making it as efficient as possible,” Peter says.

“Back home in Australia, the solution takes real responsibility in ensuring fast decision support for planning purposes.

Understanding that it’s possible to better re-allocate orders and use planning beyond logistics is a gamechanger for the Australian retail landscape.” ■ MHD DECEMBER 2020 | 43

MHD WAREHOUSING

INVESTING IN THE REGION Dexion Asia Pacific is taking the next step to strengthen its presence in the region by investing in a new state-of-the-art manufacturing facility in Asia Pacific.

MHD finds out more.

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eadquartered in Australia, Dexion is a leading global storage solutions provider with operations throughout Australia, New Zealand and Asia. With a tradition of more than 80 years of excellence and innovation, Dexion helps to solve the materials handling challenges for a diverse range of customers from the office through to the warehouse.

Dexion has recently announced that it will strengthen its presence in the Asia Pacific region by purchasing a six-acre land in the heart of Shah Alam, Malaysia.

Strategically situated amidst a cluster of multi-national companies, it is an established location with well-developed infrastructure

The new site in Malaysia offers ease of trading across borders.

44 | MHD DECEMBER 2020

“

This facility will achieve greater efficiency in manufacturing processes and greatly enhance our business operations.

”

and connectivity to Port Klang, Malaysia’s main logistics hub, which facilitates access to Dexion’s key export markets.

Dexion will be investing USD20 million into the new development. The sleek, modern structure features a steel and glass facade and will house a world-class manufacturing facility and regional APAC Sales Office.

“Malaysia is at the crossroads between East and West and enjoys ease of trading across borders which will benefit our growing APAC customer base. This facility will achieve greater efficiency in manufacturing processes and greatly enhance our business operations.

Our 30-year presence in Malaysia has enabled us to build strong partnerships with many key

MHD WAREHOUSING

Construction is scheduled to commence in December 2020.

customers and we would be proud to deliver even more top-notch solutions to them,” Damian Cross, Regional General Manager, Southeast Asia for Dexion Asia Pacific says.

Construction is scheduled to commence in December 2020, and the site is expected to “go live” by end of 2021. The purpose-built

“

The purpose-built facility is designed to produce best-inclass intralogistics storage solutions that will cater to export markets mainly Australia, Southeast Asia and India while continuing to serve a strong domestic demand.

”

facility is designed to produce best-in-class intralogistics storage solutions that will cater to export markets mainly Australia, Southeast Asia and India while continuing to serve a strong domestic demand. The company is also investing in new machinery to achieve high quality, high-volume production that delivers superior systems and service to customers in the region.

The new facility will also function as Dexion’s regional Design and Engineering Centre. It will also house an Innovation Centre for R&D purposes and an interactive showroom to showcase Dexion’s growing range of solutions.

In addition to the new facility, Dexion has focused their efforts on becoming a one-stop solution for key warehouse products. The business has launched a number of new products in the last 6 months, the new range of Dexion engineered products include pushback racking, pallet racking protectors, light duty cantilever, HVLS fans, docks, and industrial doors, with a strong product pipeline to come in the next 12 months.

Beyond the extensive and growing product range, Dexion gives customers in Australia access to the country’s largest logistics supply network providing expertise from 21 metro and regional locations. By being close to valued customers, Dexion is able to provide prompt, local and trusted support for a wide variety of requirements.

Future focused, Dexion is embracing the growth opportunities the Asia Pacific region will bring to its business. For Dexion customers in Australia, this is set to be a game-changer. ■ MHD DECEMBER 2020 | 45

MHD TECHNOLOGY

AUSTRALIA’S FUTURE OF DELIVERIES VIA DRONES Could drones be the answer to timely and efficient global distribution of the COVID19 vaccine? Brittany Coles investigates the potential of advanced air mobility with Prof Douglas Creighton and Dr Hermione Parsons at Deakin University.

I

n the first study of its kind, Australian researchers have found significant opportunity for drone delivery services. When the team began exploring Advanced Aerial Mobility (AAM) in Australia over a year ago, Dr Hermione Parsons, Industry Professor and founding Director of Deakin University’s Centre for Supply Chain and Logistics (CSCL) says that people would tell her that “it is madness, this is fanciful, this is the Jetsons.”

“How can we in the modern era say anything is fanciful? We each have a phone that we call a camera or a calendar, we have documents that fly through space and immediately appear in our computers. We can fly interstate and overseas, so why is Advance Air Mobility (AAM) preposterous for freight?

It’s not too out there, it’s just another tool and we must be become transport mode agnostic,” Dr Hermione says.

How do we distribute freight quickly in new patterns? She says that often when advancing technology is explored

Dr Hermione Parsons, Industry Professor and founding Director of Deakin University’s Centre for Supply Chain and Logistics.

46 | MHD DECEMBER 2020

to benefit movement in society people think it’s to replace existing modes of transport. “That is not the case.

We have a number of new supply chain issues due to the pandemic. We need new delivery methods and new possibilities to solve increasingly complex logistical challenges and that can be helped by focusing on the opportunities this new technology presents,” Dr Hermione says.

SIGNIFICANT OPPORTUNITY FOR HIGH PRIORITY FREIGHT As the world continues to urbanise, and as we move away from fossil fuels to sustainable energy sources, developing new and efficient transportation systems will be critical. To meet the challenge, industries and policy makers will need to develop new skills and change their mind-sets to make a successful transition.

Electric aviation is becoming a global movement, with significant recent advances attracting investors, companies and governments in the United States, Europe, Asia and closer to home in New Zealand, where they are set to begin passenger transport trials.

Deakin University has released a white paper that evaluates the opportunities and next steps for Advanced Aerial Mobility (AAM) in Australia, focusing on electric Vertical Take-Off and Landing (eVTOL) aircraft in the passenger and freight context.

It is the first and most comprehensive literature review and study of this nature, and analyses the regulatory challenges, operating potential and likely benefits of AAM and eVTOL. The study is a collaboration between

Professor Doug Creighton, Deputy Director of Deakin University’s Institute for Intelligent Systems, Research and Innovation. the Institute for Intelligent Systems Research and Innovation (IISRI) and the Centre for Supply Chain and Logistics.

The landmark Deakin study confirms that AAM is a significant opportunity for Australia to develop its high-tech industry sector, with potential for employment and export growth. Areas that could benefit from this advancing technology include high priority freight and personal transport, markets which would enable new technical jobs and new sources of revenue. Professor Doug Creighton, co-author of the white paper and Deputy Director of Institute for Intelligent Systems, Research and Innovation (IISRI), emphasised that while the way forward presented many challenges, the possibilities were exciting.

“There are challenges to adopting AAM in Australia, including regulation, safety, noise, community acceptance and locations but we need to support the development of capabilities related to new mobility and explore entrepreneurial ideas,” Professor Doug says.

MHD TECHNOLOGY

DISTRIBUTING THE COVID-19 VACCINE The logistics and supply chain world is preparing for the challenge of a lifetime in ensuring timely and efficient global distribution of the vaccine. As we move closer to a vaccine becoming a reality, Dr Hermione Parsons says the potential for AAM in the local supply chain will be of high value and could provide organisations with solutions as the vaccine supply chain scrambles to solve different distribution scenarios.

“How do we move freight very quickly in a decentralised pattern of distribution when we have new challenges associated with the pandemic and changing societal expectations and behaviours? “Time and the secure delivery of inventory are really important issues in logistics and AAM may be fit for purpose.” she says.

Professor Doug says the distribution of a vaccine will require a concentrated global supply chain effort with diligent forward planning. Vaccines are of higher values than the average consumer product due to its sensitive nature of being a temperature-controlled item.

Dr Hermione recalls a fascinating case study throughout this research that highlighted proven success of vaccine delivery through drones. In Africa, Rwanda - ‘the land of a thousand hills’ – they use a drone technology called ‘Zipline’ which cuts blood delivery times down from four hours to just 15 minutes in some cases. “A country we don’t think of as an advanced nation uses drone technology to distribute blood for transfusions to save children with AIDS across the country. Rwanda has gone on to use drones to manage soil quality and crops and that is just amazing. This technology could also be used to distribute the COVID-19 vaccine across difficult landscapes?”

Dr Hermione says the end goal is to bring this important COVID-19 vaccine to everyone when it becomes a reality.

“It’s not fanciful to think about the complex task of distributing a vaccine via the sky. However, we must also think about the supply chain service in totality – the nurse who will be jabbing the vaccine, the vaccine, the security of product, specialised refrigeration and other equipment… so how will it all work?” she says.

Dr Hermione suggested aged care

may be the priority for the first wave of vaccination. First, location must be considered. “Plenty of aged care facilities are in little towns dotted throughout rural Australia. To ensure as many nursing homes are receiving the vaccine as quickly as possible it could well be an AAM or eVTOL aircraft is used to speed up the process,” she says.

Australia could potentially see AAM or eVTOL aircrafts landing in the carparks of aged care facilities, shopping centres or medical clinics. “We know from COVID-19 testing sites that medical attention is now occurring in car parks.

If we reconsider the phenomenal pace of change across the sector and in technology, it could happen,” Dr Hermione says.

EMERGING TECHNOLOGY TAKING OFF Up until covid, the role of commercial airlines in Australia has primarily been intercity movement of people and freight. I don’t see eVTOL as changing this role but integrating AAM with existing transport networks will encourage markets to be creative with consolidation and distribution of their goods,” Professor Doug says.

Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack said a report released by the Australian Government on the economic benefit of drones in Australia quantified the potential benefits and savings broader drone use could have for the nation’s economy over five, 10

and 20 year periods.

“Expanding drone and aerial taxi use is expected to have a major economic boost for Australia, providing a $14.5 billion increase in GDP over the next 20 years – of which $4.4 billion would be in regional areas across New South Wales, Queensland and Victoria,” the Deputy Prime Minister said in November at the time of the report.

According to Professor Doug, we have the potential to drive cost down using emerging technology in society and drone use could even be the same price as a cab ride. He says there is already recognised opportunity in the medical area and further innovation is being trialled following recent studies.

“The disruption to the aviation market has pushed further innovation for aircrafts beyond passengers and cargo. In agriculture, drones could support farmers by decreasing the costs of production,” Professor Doug says.

Dr Hermione goes on to emphasise that we are in a unique position as a nation to grasp the benefits of drones with both hands.

“This is about meeting new and unexpected supply chain demand.

We must open our mind to new possibilities, and I believe from our whitepaper research, experiences and consultation with AAM in Australia, there are significant opportunities here. The technology is evolving fast with massive investment worldwide and our research shows its uses for both people and freight are real,” Dr Hermione says. ■

In Rwanda, Africa, communities use a drone technology called ‘Zipline’ which cuts blood delivery times down from four hours to just 15 minutes in some cases.

MHD DECEMBER 2020 | 47

MHD WAREHOUSING

STRUCTURAL STRENGTH Leading storage manufacturer APC takes the complexity out of the equation by co-designing structural platforms directly with their clients. MHD finds out more.

T

he global demand in e-commerce is having a massive effect on consumption and is expected to continue its prevalence in Australia.

This is driving demand for increased automation in distribution centres as well as other essential markets.

The developers of these new automated warehouses and DC’s engage with systems integrators that provide a number of various automated processes and link these together to provide a turnkey solution. These systems often require a complex array of support structures, platforms and maintenance access systems to compliment and link together the sophisticated conveyors and robotic equipment.

Automation solutions often bring additional levels of complexity and require the introduction and use of platforms or mezzanines.

These platforms are used to provide the support structure that is typically integrated with goods to person automated equipment as well as for maintenance and personnel movement.

This automated equipment places high demands onto the supporting platform structures. These platforms must be designed to suit very specific static and dynamic loads as well as

Engineering model.

48 | MHD DECEMBER 2020

often dealing with varying degrees of vibration and extremely sensitive scanning and weighing equipment.

The platforms include bespoke access systems such as catwalks, stairs, ladders, step-overs and associated structures to ensure personnel are able to operate safely within and around the automation equipment and accessways.

Various flooring types are specified per application for the operating equipment it is supporting as well as integration with the steelwork substructure. Typically, these are steel grating types which can be forge welded or press locked. Timber varieties include various thicknesses and coatings which can be processed with anti-slip properties on the walking surface or even have technical materials applied to the underside, which assists to achieve the required lux requirements in the operator working environment.

There are also numerous complexities that are considered in the selection process in order to accommodate various concentrated and distributed loads, supporting steel member spans, floor penetrations for complex conveyor systems and robotic equipment. This equipment can be above or below the floor (or multi-tier) levels.

Actual structure.

APC provide unique modular guardrailing solutions which are adaptable to suit the differing requirements for personnel and machine guarding.

Ensuring a safe working environment where equipment and personnel are working in close proximity to each other is paramount to the success and effectiveness of the modern distribution centre.

Australian standards and storage type classifications govern the selection of the flooring types in the designs.

Sometimes, new designs are required to be developed, tested and approved for manufacture to meet the requirement of the unique overall solution and still meet these stringent local standards.

Sean Prosser, APC’s Sales Manager explains the co-design process “APC usually start with the set-up of client and in-house engineering teams and begin the design stages once the scope is finalised. During this stage the requirements of the system is matched with the structural requirements of the design. Clash checks are a large part of the next stage where 3D models are shared between the engineers and extensive collaboration occurs between the two teams. Once the models are approved the specific details are added

MHD WAREHOUSING

Integrated multi-tier structure. to the model and detailed construction drawings are developed from this. This process ensures we develop the optimum design for our clients,”, Sean says.

This typically consists of a basic and detailed design with sub-elements including calculations of building connections & forces, steel member selection, connection details, 2D drawings, BOQ reports, fully detailed 3D models and detailed engineering report.

“We are highly qualified in our field with a team of experienced structural engineers enabling us to design and manufacture complex racking and support structures across a diverse range of industries,” Sean says.

There are many challenges faced during the whole design and engineering process as many systems have different specifications that need to be met. Sean says APC need to take a number of input criteria into consideration including; • Flooring type • Fire systems • Workstation positions • Access and Egress requirements • Maintenance and Emergency pathways • Dynamic loads

“

Clash checks are a large part of the next stage where 3D models are shared between the engineers and extensive collaboration occurs between the two teams.

”

• Vibrational effects • Equipment point loads • Environmental factors e.g. wind load actions and seismic design In order to provide the best ‘fit for purpose’ solution the APC team need to be proficient in their understanding of the full range of standards, regulations and codes that are applicable to the engineering, machinery, safety and construction industries.

“APC Project Management is another strong feature of the turnkey service we offer and this is underpinned by our ISO accreditations where we manage and execute the multiple disciplines of design, engineering, fabrication and on-site construction. Our accreditation to AS/NZ 4801:2001 and ISO 45001:2018 Occupational Health & Safety Management Systems ensures we implement the strongest levels of OHS on all sites that we operate on.

“APC proudly uses Australian Steel for its structures. Our clients benefit with stronger design & fabrication lead-times as well as platforms that are designed to strictly conform to Australian Standards and the Building Code of Australia,” Sean concludes. ■ MHD DECEMBER 2020 | 49

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MHD PROPERTY FOCUS

CONFIDENCE IS KEY Australian industrial and logistics property is currently the most sought-after property asset class. Luke Crawford, Associate Director Research and Malcom Tyson, Managing Director, Industrial at Colliers International provide a 2021 outlook for the Australian industrial and logistics sector.

A

ustralian industrial and logistics property is currently the most sought-after property asset class, over $4.3 billion has traded within the sector this year, underpinned by favourable structural tailwinds which continue to positively impact the division.

The rapid increase in e-commerce coupled with expansion requirements from supermarkets and pharmaceutical companies, has had a positive impact on Australian REITs (A-REIT) with exposure to industrial property.

According to a Capital Markets outlook for 2021, Colliers International predicts the industrial and logistics investment market is expected to gather further momentum in 2021. Malcom Tyson, Managing Director, Industrial at Colliers International says the early signs of market recovery are starting to appear and strong growth can be expected into the new year off the back of stabilized business and consumer sentiment.

Luke Crawford, Associate Director | Research at Colliers International says 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. According to Australia Post’s October e-commerce report, online sales have grown by almost 80 per cent and there is no doubt the industry is hurtling towards the biggest peak in online shopping history.

Luke and Malcom agree that looking ahead, strong leasing demand is expected across industrial markets in 2021, underpinned by the continued growth of e-commerce, which will bolster warehouse demand. “The sector’s landscape has changed significantly, but the market should be prepared and excited by the changing market conditions that can work in

52 | MHD DECEMBER 2020

Luke Crawford, Associate Director Research at Colliers International. industrial occupiers and investors favour next year,” he says.

HOW DID INDUSTRIAL PROPERTY PERFORM IN 2020?

“2020 will be remembered as the year of industrial property, it’s gone from the poor cousin to the favourite uncle of the real estate sectors,” Luke says. Almost overnight, the world was disrupted this year. Businesses have been forced to adjust to supply chain disruptions and as a result, the sector has seen a significant investment in supply chain management solutions and diversification of supplier networks. Due to the unforeseen circumstances, did any predictions for the industrial property market meet expectations?

Luke says although the pandemic couldn’t have been predicted, it certainly was a launching pad for the industrial and logistics sector, outperforming all other mainstream real estate sectors. At the start of the year, Colliers forecasted a record year for leasing volumes. “Whilst they’re slightly down on what we forecasted, volumes are up considerably nationally from this time last year,” he says.

That’s underpinned by the precommitment market, such as Amazon’s new 200,000sqm facility that’s set

Malcom Tyson, Managing Director, Industrial at Colliers International. for Western Sydney and Woolworths pre-committing to 75,300 sqm across two facilities within the Moorebank Intermodal Terminal highlights this with the national distribution centre expected to be semi- automated while the regional distribution centre is expected to be fully automated.

In the 12 months to September 2020, the industrial sector provided a total return of 11.2 per cent, broadly split between capital and income return, and was above the 6.8 per cent and -10.0 per cent recorded for office and retail sectors respectively over the same period.

Malcom and Luke say that the leasing market has remained strong, underpinned by requirements from transport, retail and food logistics groups. However, deals are taking longer to get over the line given the uncertainty on business operations and occupiers are increasingly staying put within their current facility. “It’s important to note that despite the challenges, the investment market hasn’t skipped a beat with the depth of capital from local and offshore groups remaining significant post COVID-19,” Luke says.

According to the Colliers Directors, supply chains were always going to strengthen this year, and the clear

MHD PROPERTY FOCUS winners in 2020 are those occupiers tied to e-commerce, food logistics, pharmaceutical and transport and logistics. Luke notes that the big winner in the investment market has been prime core assets backed by a strong covenant where continued yield compression has been recorded as the flight to quality thematic plays out.

“The sector has since proven how resilient it has been with leasing enquiries growing strongly from the second half of this year. We expect economic conditions to improve in Q4 2020 and into 2021 which will further support spending patterns and industrial occupancy demand.”

E-COMMERCE TO RESULT IN RECORD INDUSTRIAL LEASING DEMAND Luke says there are several trends and themes which have emerged and will continue to shape the sector in 2021 and beyond. “The giant itself, e-commerce, will continue to surge and translate into strong growth for warehouse demand as ‘pure-play’ online groups and retailers look to bolster their fulfilment capabilities,” he says. “It will definitely moderate itself throughout 2021 and beyond, but e-commerce will have an important impact on industrial property.

In 2019, Australians spent $61 billion on overseas travel and with our international borders likely to be shut for some period, a large chunk of this money will be deployed on retail goods, both online and in stores, which will support demand for industrial space.”

The experience from the US shows that for every $1 billion AUD spent on online sales, approximately 85,000 sqm of warehouse space is needed – three times the amount of warehouse space required for traditional brick-and-mortar sales. Using the same measure locally, this would have translated into ~580,000 sqm of warehouse demand from the additional $6.9 billion spent on online sales over the past year.

“Online grocery and food sector has experienced rapid growth over the past 12 months, up over 80 per cent in the year to September 2020. We expect this growth to prompt increased demand for cold storage logistics space in 2021,” Malcom says. Malcom said looking ahead, online retail is expected to further increase in popularity as consumers embrace online shopping platforms.

“We are forecasting online retail spend to total circa $58 billion by the end of 2022, which would translate into warehouse demand of around 2.7 million sqm between now and then from e-commerce alone, based on experience from the US.”

SUCCESSFUL RETURN OF CONFIDENCE

“

The giant itself, e-commerce, will continue to surge and translate into strong growth for warehouse demand as ‘pure-play’ online groups and retailers look to bolster their fulfilment capabilities.

”

“We’re going to see a lot of activity in 2021.

Occupiers can expect a whole lot of efficiency gains, it’s going to be a pretty busy year and a lot of focus will be on the bottom dollar,” Malcom says. He notes that beyond next year and across 2022-23, the industrial market will join other sectors in playing catch up from 2020’s disruption to the market.

“Melbourne has been the most impacted due to the city entering a Stage 4 Lockdown, however the investment market within Melbourne remains strong with transaction volumes in 2020 already surpassing the levels recorded in 2019. We’re confident a number of significant transactions will be on the cards, as forecasted for other major capital cities and regions in Australia,” Luke says.

Malcom highlights that leasing demand is expected to accelerate in 2021 as businesses have more clarity around the short to medium term impacts of COVID-19 on their operations. Demand is expected to be led by pre-commitments as occupiers focus on automation and efficiencies. “Indeed, a major record year of leasing demand is expected across most markets, underpinned by the continued growth of e-commerce which will bolster warehouse demand,” Luke added.

Rents have remained flat across most markets in 2020, however, growth is expected to pick-up in 2021 towards the longer-term average while incentive levels are expected to stabilise following the recent increases.

“Certainly overall, the outlook for the industrial and logistics investment market remains positive and is expected to gather further momentum in 2021,” Malcom says. ■

For every $1 billion spent on online sales, approximately 85,000 sqm of warehouse space is needed.

MHD DECEMBER 2020 | 53

MHD SCLAA

A YEAR OF DISRUPTION AND ONGOING CRISIS There has been much in the media regarding Sydney’s empty container management during, what can only be described as, a perfect storm of disruption in usual containerised freight flows.

“ Sue Tomic, Director at SCLAA.

I

t is a truth universally acknowledged, that this time of year usually produces extraordinary challenges in the containerised freight industry. With the peak period influx of imported goods into Sydney, the invariable result is a glut of empty containers in the marketplace, which are then evacuated en masse during January and February.

This year, the challenges of container management started early, and have continued to snowball. The result has been delays in supply of imported goods and increased congestion at all Sydney Container depots as empty container evacuations have slowed CTAA (Container Transport Alliance Australia) states “an imbalance of over 30,000 TEU since April of imported containers (full and empty) compared to containers exported (full or empty) through Port Botany.”

“That’s over 30,000 TEU in the container 54 | MHD DECEMBER 2020

SADA has a 3.5km dual rail track connecting directly to the Southern Freight line and is the only Freight Intermodal with capability to handle Bulk and Containerised cargo in Sydney.

”

logistics chain in NSW that otherwise should have been reshipped or re-used, but instead are piling up in empty container parks and transport yards.”

As empty depots reach and exceed capacity and the industry scrambles to find alternative container storage space, the supply chain flow on effects are cited as huge as “import empties [are] unable to be de-hired, empties [are] being staged through transport yards and held until they can be dealt with” But who is to blame? The current freight crisis causes and solutions, to alleviate the situation, are 50 shades of grey.

Notwithstanding Covid-19 and its disruption to the supply and shipment of goods, according to SAL (Shipping Australia Ltd), the overwhelming disruptive causes to Sydney Stevedoring operations have also been plagued by MUA Industrial action and adverse weather disruptions, both of which have slowed and at times stopped, vessel berthing and servicing. There is little doubt this has exacerbated the situation, as dwell times of containers in landside facilities increase. Shipping lines want and have the need, to reposition empty containers out of Port Botany, as there is a current shortage in Asia to fill export needs. To their credit, they have endeavoured to provide relief by way of “sweeper vessels” (additional vessels calling Port Botany purely to evacuate empty containers) but the effectiveness of these considerable and costly efforts, rely on strict vessel scheduling and the backlog of vessels being cleared in the first instance.

Add to this, NSW Ports cites “the closure of Sydney’s largest empty container park (24% of Sydney’s empty container capacity) to make way for construction of the Sydney Gateway road” as another contributing factor to the current congestion.

However, besides Covid, none of these factors are new. Peak period container congestion is an annual phenomenon, the closure of Tynes Empty Depot has been on the drawing Board since the Scoping Report was

MHD SCLAA

This year, the challenge of container management started early. issued in Nov 2018 Industrial actions have historically recurred in the lead up to expiry of Stevedoring Enterprise Agreements and are more likely when these Agreements have expired.

Whilst NSW Ports has created “new capacity to increase empty container storage supply in NSW” this has been within the Port Botany precinct, which may increase road congestion in the area and transport operator’s frustrations.

The empty container capacity crisis was foreshadowed by Transport for NSW through the proactive commissioning of a formal report in 2019 The causes have been well identified and solutions proposed.

One of those solutions to facilitate expected trade growth, has been the identification of suitable container depots in Western Sydney, closer to

distribution centres. Major industry stakeholders have had the foresight to commence investment in the West, with one large scale Intermodal and Empty Container depot that is operations ready, the Sada Intermodal at Spring Farm.

CEO of Sada Intermodal, Tony McFadden, states ““SADA has the land, (47ha) location, infrastructure and capacity, to service shipping lines, regional shippers and the wharf cartage industry. SADA has a 3.5 km dual rail track connecting directly to the Southern Freight line and is the only Freight Intermodal with capability to handle Bulk and Containerised cargo in Sydney.It also lends itself easily to the movement of intra and interstate freight and is open access to all rail operators and Road Freight Transport companies.”

If only one thing became clear during

2020, its that disruptive factors call for innovative solutions. Inland facilities are not new and are used extensively in other Continents.

And what does the future hold? The situation may well get worse over coming months as the backlog of vessels are cleared unless what goes out matches what comes in. Then there is the small problem of China importing less from Australia as the list of banned Australian commodities increase.

No one could forsee this particular turn of events, and this may well lead to a further imbalance of container trade and increased container dwell times in landside operations. A new approach to freight flows and out of the box operational practices is needed. As the saying goes, If you always do what you’ve always done, you’ll always get what you’ve always got. ■

1. Jane Austen, Pride and Prejudice 2. Neil Chambers, CTAA, https://www.fullyloaded.com.au/industry-news/2009/sydney-empty-container-management-reaches-crisis-point 3. Neil Chambers, CTAA, https://www.fullyloaded.com.au/industry-news/2009/sydney-empty-container-management-reaches-crisis-point 4. https://shippingaustralia.com.au/congestion-update-current-status-bad-weather-new-industrial-action-container-hire/ 5. https://www.dhl.com/content/dam/dhl/global/dhl-global-forwarding/documents/pdf/glo-dgf-ocean-market-update.pdf 6. https://www.nswports.com.au/nsw-ports-ceo-update 7. https://www.planningportal.nsw.gov.au/major-projects/project/10156 8. https://www.nswports.com.au/nsw-ports-ceo-update 9. https://www.transport.nsw.gov.au/system/files/media/documents/2020/empty-container-supply-chain-study-web.pdf 10. https://www.transport.nsw.gov.au/system/files/media/documents/2020/Empty-Containe-Supply-Chain-Study-findings-recommendations-and-next-steps.pdf 11. https://www.planningportal.nsw.gov.au/major-projects/project/10636 12. https://www.afr.com/world/asia/china-targets-6-bln-of-australian-exports-in-fresh-coercian-campaign-20201103-p56ayx 13. Henry Ford (unconfirmed)

MHD DECEMBER 2020 | 55

MHD FROM THE ALC

WELCOME TO COVID NORMAL COVID-19 broke down long standing curfew policy barriers in record time because they made sense to both the supply chain industry and communities alike. Welcome to COVID NORMAL. Here’s why we need it to stay.

G

overnments and industry came together during the COVID-19 crisis in ways that few could have ever imagined let alone predicted.

Empty supermarket shelves panicked the nation and the cry was heard to quickly consult and collaborate with industry to ensure essential supply for all Australian consumers.

The outcome for our industry was that freight continued to cross state boarders and into communities.

Where others grappled with enduring obstacles, the freight industry worked incredibly closely with governments to, quite literally, continue to deliver.

Welcome to COVID normal.

The supply chain industry is now in a greatly enhanced position. It has achieved high levels of trust and quality relationships with governments, extending across a broader range of Federal and State departments (including Home Affairs and Treasury) to table once difficult and long-drawn out discussions.

ALC is now calling on government to hold on to this new COVID normal and establish a formal process to collaborate with industry at the beginning of the policy development process – not the end.

The standard government process to

56 | MHD DECEMBER 2020

addressing a problem or opportunity is to develop policy, implement that policy through regulation and/or legislation, then give industry the opportunity to address it through a Regulatory Impact Statement. COVID turned this on its head as the deep experience and understanding of industry was engaged from the beginning. Helping address the problem or the opportunity and working together to deliver sensible solutions.

When meaningful collaboration is the start of the process, as demonstrated throughout COVID, benefits fall to everyone.

Take the curfews example. The problem was too much noise, the early solution was to ban delivery at certain times or restrict access, particularly around residential areas.

Fast forward to 2020. If governments and Industry consulted on the same problem today the sensible resolution wouldn’t require regulation or legislation that ultimately costs the economy dearly. Modern demands would be met with modern remedies. These could include the use of much quieter electric vehicles and changing regulations on noisy reversing alarms by engaging new and widely available technologies like reversing cameras and proximity sensors. Sensible industry led solutions,

recommended by industry experts.

The new COVID normal approach has delivered other benefits. It has exposed government decision makers to the professionalism, ‘can do’ attitudes and high-calibre people that are fundamental to our industry. This has justifiably, and dramatically, increased the trust of senior bureaucrats, political leaders and governments in our industry.

Through this mechanism we can move beyond old-school default positions including those that unhelpfully immediately prioritise the movement of people over freight. What the COVID experience has shown us is that there are many circumstances in which the movement of people is far less critical than the movement of freight.

We must bank the trust dividend and ensure open conversations and collaboration across ministries and governments extend into the future.

As has been amply demonstrated throughout this crisis, we achieve great things working together. COVID normal is here to stay. The benefits, hard won during the most difficult of times, must be preserved and put to work as Australia grows its way out of a recession with the full and essential support of the supply chain industry. ■

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MHD FROM ASCI

SEASON’S GREETINGS TO THE ASCI COMMUNITY Throughout our Continued Professional Development Program this year, we’ve focussed on resilience, agility, integrated planning and ways in which you can mitigate risks and impacts of COVID-19 and the economic downturn in your supply chain.

Alexandra Riha, President at ASCI.

W

e all have demonstrated immense personal resilience in 2020.

As the year draws to an end, reward yourself and your team in any one of three ways: 1. Apply to join the Professional Accreditation Scheme as a Practitioner or Associate - to reflect your career pathway ambition 2. Reserve your team a ticket to the annual conference, ASCI2021 in February - for executive networking and first hand perspectives 3. Reward your team with APICS Certification training and enrol them our 2021 classes We are excited to host our first breakfast networking event in Perth in December with Barry Standing, Executive Director, Supply for Mineral Resources to address “Scale At Pace.”

This event be the blueprint for future networking events in 2021, with ASCI2021 as the first returned gathering for the entire community in February, though under COVID-19 regulations.

I would like to thank ASCI Members for supporting our vision to professionalise supply chain management and the ASCI Volunteers 58 | MHD DECEMBER 2020

who add so much value: • Directors: Inderjeet Virdi, Geoffrey Palm, Linda Venables, Tom Janoshalmi, Michael Harich.

• Committee Chairs, Presidents & Vice Presidents: Brendan O’Keeffe; James Scotland; Indrasen Naidoo; Matthew Jackson; Flavio Macau; Christine Miller, Tim Proust.

• Committee Members: Pieter Nagel, Wayne Larsen, Michael Milnes, Michael Owen, Rebecca Presgrave, Azraai Abi Musa, Mallaiyaraj Mahalingam, Mark Skrzypiec, David Woods, Craig Bennett; Justine Butcher; Bree Clements, Fergus Cox, Scott Theuerkauf, Adriaan Van Wyk,

Ahsan Ahmed, David Hogg, Karen Livey, Ignacio Losada, David Hogg, Stephen Murdoch, Vinod Nagarjan, Martin O’Connor, Suhaila Quaddus, Cindy Tran.

• ASCI2021 Advisory Board: Hayley Jarick, Giovanni Ferrante, Tania Montesin, Duncan Wardle, Nigel Prevett, Amanda Brisot, Nina Younes.

To everyone in the supply chain community, take a well earned break and stay safe.

Warm regards, Alexandra Riha President, Australasian Supply Chain Institute ■

MHD FROM ASCI

REGISTRATION ASCI’s Professional Accreditation Scheme provides industry-wide standards and consistency in the profession.

This Professional Accreditation Scheme, through which individuals can register as Professionals, Practitioners and Associates, provides recognition of professional achievement against a globally aligned, industry accepted set of standards, on par with other professional disciplines.

There are nine Registrations under the Professional Accreditation Scheme: 1. Registered Professional (PrSCM)* 2. Registered Operations Practitioner (RegPracOps) 3. Registered Procurement Practitioner (RegPracProc) 4. Registered Logistics Practitioner (RegPracLog) 5. Registered ILS Practitioner (RegPracILS) 6. Registered Operations Associate (RegAssocOps) 7. Registered Procurement Associate (RegAssocProc) 8. Registered Logistics Associate (RegAssocLog) 9. Registered ILS Associate (RegAssocILS) *Available in 2025 Visit the ASCI website for a free Provisional Assessment Of Eligibility For Registration at https://www.asci.org.au/registration-process Continued Professional Development ASCI Annual Conference (20 CPD points) Supply Chain Vision In the Decade For Action 23-25 February 2021, William Inglis Hotel, Warwick Farm, Western Sydney Register: www.asci-2021.com.au

Continued Professional Development ASCI Annual Conference (20 CPD points) Supply Chain Vision In the Decade For Action 23-25 February 2021, William Inglis Hotel, Warwick Farm, Western Sydney Register: www.asci-2021.com.au

Global Professional Certifications APICS: Certified Logistics, Transport and Distribution; Certified in Production & Inventory Management; and Certified Supply Chain Professional Institute for Supply Management: Certified Professional in Supply Management VCare: Certified Stores & Stock Controller Waitlists are open for Term 1 2021 Classes. Visit https://www.asci.org.au/events

Global Professional Certifications APICS: Certified Logistics, Transport and Distribution; Certified in Production & Inventory Management; and Certified Supply Chain Professional Institute for Supply Management: Certified Professional in Supply Management VCare: Certified Stores & Stock Controller Waitlists are open for Term 1 2021 Classes. Visit https://www.asci.org.au/events

Membership is $275 per annum.

Membership is $275 per annum.

For more information about member benefits, please visit https://www.asci.org.au/Benefits

For more information about member benefits, please visit https://www.asci.org.au/Benefits

MHD DECEMBER 2020 | 59

MHD THE LAST WORD

SHINING THE SPOTLIGHT

BY PAUL ZALAI – DIRECTOR FREIGHT & TRADE ALLIANCE (FTA) AND SECRETARIAT AUSTRALIAN PEAK SHIPPERS ASSOCIATION (APSA)

F

TA and APSA welcome the Container stevedoring monitoring report 2019-20 released by the Australian Competition and Consumer Commission (ACCC) on 4 November 2020.

The report clearly supports our advocacy addressing stevedoreimposed Infrastructure Surcharges and shipping line imposed Port Botany Container Surcharges - a summary of key findings and FTA/APSA commentary is available below:

STEVEDORE REVENUES INCREASE DESPITE A SIGNIFICANT REDUCTION IN CONTAINER VOLUME ACCC key finding - Stevedores’ total revenues at monitored ports increased by $38.9 million, or 2.8 per cent, despite a significant drop in container volumes. It appears the main driver of increased revenues, despite a moderate reduction in costs and reduced volumes, was further increases in Terminal Access Charges (TACs, formerly called ‘infrastructure charges’). TACs on aggregate have increased by $87.6 million, or 51.9 per cent, since 2018–19.

FTA / APSA COMMENTARY The ACCC analysis is clear.

Stevedores are operating in a highly competitive environment with limited shipping lines serving the Australian market and larger vessels deployed under consortia arrangements. As a result, stevedores are clearly reducing quayside charges imposed on shipping lines to retain and win new business and are making up the lost revenue and achieving significant profits through an increase on landside charges (including Infrastructure Surcharges now more appropriately referred to as Terminal Access Charges).

60 | MHD DECEMBER 2020

This cost reduction for shipping lines has not translated to a commensurate reduction in Terminal Handling Charges passed on and paid by exporters and importers.

The FTA / APSA submission on in response to the ACCC Discussion Paper – Proposed Class exemption for Ocean Liner Shipping recommended a registration process to mandate incorporation of stevedore supplier fees to be administered direct and solely against shipping lines (negating the practice of stevedoreimposed “Infrastructure Surcharge” administered against the transport sector).

As highlighted in the recent FTA / APSA supply of evidence before the Inquiry into the implications of the COVID-19 pandemic for Australia’s foreign affairs, defence and trade, we will continue our advocacy emphasising that it will be the efficient movement of goods that will lead our economic recovery and generate national wealth, not the welfare and self-interests of infrastructure owners.

APPROPRIATENESS OF THE POINT OF CHARGING ACCC key finding - Because importers and exporters contract with shipping lines to send cargo and the shipping lines then choose the stevedore, TACs are to some extent a ‘take it or leave it’ proposition. Since landside port users cannot directly choose their stevedore there is little effective constraint on these rising charges.

FTA / APSA COMMENTARY All businesses face a dilemma of how to deal with unavoidable costs such as rent, infrastructure, labour and power. Those same businesses are then forced to either absorb costs or pass them on to their commercial

clients. Similarly, stevedores should be forced to either absorb operating costs or pass these on to their commercial client (shipping lines). Shipping lines then have the choice to absorb costs or pass these onto shippers (exporters, importers and freight forwarders) through negotiated freight rates and associated charges.

RESPONSIBILITY LIES WITH STATES TO REGULATE ACCC key finding - The ACCC is concerned that the benefits of greater competition between stevedores to provide services to shipping lines will be eroded by increasing TACs, although any regulation of these charges is a matter for state and territory governments.

FTA / APSA COMMENTARY This position aligns to the response from the Deputy Prime Minister to our formal submission titled Status report - Container Stevedore Imposition of Terminal Access Charges (27 May 2020) Importantly the Deputy PM notes the following: • support for our advocacy, noting the operational and cost implications for exporters and importers caused by Infrastructure Surcharges; • acknowledgement of our positive engagement on broader freight and trade policy matters during COVID-19; • clear articulation that stevedore pricing reform is a state government responsibility (negating arguments from the states pointing back to the Federal Govt to lead); and • reference to the ACCC to ensure that stevedores involved vertical integration operations do so on a ‘level playing field’ with others in the supply chain and do not use Terminal Access Charges for commercial advantage / offset pricing. ■

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MHD PEOPLE ON THE MOVE

PEOPLE ON THE MOVE A monthly wrap up of the latest appointments in the supply chain, materials handling and logistics industry.

TM INSIGHT WELCOMES NEW DIRECTOR OF PROPERTY

NEW DIRECTOR OF POLICY AND ADVOCACY FOR ALC

NEW DIRECTOR OF COMMS AT ALC

TM Insight has announced the appointment of Nick Greenwell, Former National Director of Industrial Occupier Services at Colliers, as Director of Property in NSW. Nick will

Rachel Smith has joined the Australian Logistics Council (ALC) as Director of Policy and Advocacy. Responsible for driving the

Hayley Lusk has joined the Australian Logistics Council (ALC) as Director of Communications. Hayley joins ALC from Metcash where she was

work alongside TM Insight’s leadership team to procure industrial facilities as part of TM Insight’s strategy to design and deliver supply chain transformations.

NEW MANAGING DIRECTOR TO TRANSFORM BIG W Woolworths has appointed an executive who has been with New Zealand general merchandise retailer The Warehouse Group to drive a turnaround of BIG W. Pejman Okhovat will join Woolworths Group as Managing Director, BIG W to continue the retailer’s transformation journey.

Do you have career news to share?

Email Melanie Stark at melanie.stark@primecreative.com.au to be featured.

62 | MHD DECEMBER 2020

strategic supply chain policy agenda, Rachel joins ALC from the Pharmacy Guild where she lead the negotiation of a $25.3b funding

the National Brand Manager leading their IGA supermarkets portfolio

agreement with the Commonwealth.

SCOTTSRL NAMES NEW CEO National temperature-controlled transport operator, Scott’s Refrigerated Logistics (ScottsRL), has announced the appointment of Brett Lynch as new Chief Executive.

Brett currently serves as the CEO of freight services provider Pacific National, where he also undertook a variety of roles spanning national operations and divisional management including being President of the Coal division.

NEW INDUSTRIAL AND LOGISTICS MANAGER FOR SAVILLS AUSTRALIA Savills Australia has announced the appointment of Laagan Whalan as Manager, Industrial and Logistics, based in Melbourne.

With over 10 years’ experience in sales and leasing, Laagan has spent the last three years focused on Melbourne’s western and northern markets.

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