Supply Chain Management March 2022 by SundayTimesZA

2022

www.businessmediamags.co.za

Management MATERIALS HANDLING CHALLENGES AND

TECHNOLOGY

SOLUTIONS

The positive impact of AI

DRIVING SUSTAINABILITY

From in-house skills to electric vehicles

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Unitrans as a diversified supply chain solutions company is committed to capacity building Driver training is arguably the single biggest intervention that can be made to reduce South Africa’s high road accident rate, says Melanie NaidooPadayachee, Head of People Development and Culture at Unitrans Supply Chain Solutions. The logistics service provider has a strong focus on the development and training of its driver core that sits at the heart of its business. “Improving the skills capability and practices of our drivers holds huge benefit - not only from a company bottom-line perspective, but also for the safety of all users of the road,” she explains. South Africa’s road death toll has been a subject of much discussion over the years, being one of the leading causes of death in the country. The government estimates the Road Accident Fund will increase to R518 billion in the 2023/24 financial year as it continues to grapple with the challenge of curbing road carnage. “Whilst there is a deep-seated need to strategise and understand how our industry will evolve and what skills we need going forward to deliver our business goals, we also need to look at the capabilities needed to address the systemic issues we have in the country and in the transport sector where our business operates, in particular.”

Transporters, says Naidoo-Padayachee, must be the change they want to see on the road. “Increasing the skill level of our drivers in such a way that they have a positive impact on road safety is at the heart of our training approach.” Change in narrative Whilst training has always been ongoing at Unitrans, a fundamental shift was made to the company’s approach to training in recent years. The training curriculum centered on intrinsic motivation, essentially driving the value that each employee needs to make it home safely to their loved ones. “It is a partnership with drivers more than anything else,” explains Naidoo-Padayachee. It is an approach that has paid off, as the company has not only seen a change in the confidence of its drivers, but also in the competence levels showcased on the road.

Solutions-driven According to Naidoo-Padayachee, the need for ongoing training and development has long been identified as integral to the Unitrans business model. “It produces safety compliance and competitive skills levels,” she says, noting that it also speaks to employee retention, productivity levels and attracting new talent to their business “Our belief has always been that the current driver licensing framework is not enough in navigating today’s driving landscape,” she says. “With this in mind, we have identified the critical importance of the private sector in addressing road safety and ensuring our employees are equipped with the necessary tools and competencies to do their jobs well.”

Unitrans drivers receiving practical firefighting training with simulated situations

Bespoke solutions Capacity building at Unitrans is delivered through a focused and bespoke approach that focuses on training, technical ability, practical learning, refresher training and monitoring. “Through the analysis of our business needs, we created a bespoke training curriculum with various methodologies and unit standard learning to address identified gaps.” With more than 3000 drivers in the organisation, it is a huge undertaking. “Training takes the unique circumstances that drivers experience into consideration, but also brings context to them sharing insights as to how their customer interactions and brand representation benefits our business,” explains Naidoo-Padayachee. Training, however, cannot only happen in a classroom: practical learning is critical to the success of the programme. “We have adapted firefighting and first aid courses for our drivers, but we don’t just teach the theory: they practically have to train in simulated situations,” says NaidooPadayachee. This practical training also includes incab assessments and video simulations that take truck drivers through various scenarios. Training at Unitrans is also not a once-off occurrence and happens frequently as drivers are kept on their toes. “We embed our training into the daily practices of our drivers, making sure they have the necessary skills at all times to deal with an everchanging environment.” Monitoring is just as important a part of the process as the training itself. She adds: “Not only the monitoring of our training standards, but also the monitoring of our vehicles and drivers through the Unitrans Control Tower to ensure operational excellence.”

Spreading Joy Through Toys Unitrans has joined hands with its customer, PET and polymer manufacturer Safripol to bring joy to hundreds of underprivileged children across South Africa by donating preloved toys. Many children never get to experience the sheer joy of owning a toy. The Let’s Plastic Responsibly Toy Campaign, started by Safripol in 2020 and in partnership with Unitrans, The Angel Network and Toy Kingdom, sets out to change this by collecting, refurbishing and donating pre-loved toys to children’s orphanages across the country. What started at five locations with 10 beneficiaries, has since grown to more than 64 locations around the country where people can donate pre-loved toys which are then distributed to more than 50 organisations working and caring for underprivileged children.

The organisation has implemented a comprehensive set of in-cab technologies onboard all their vehicles to assess and track driver behaviour. “Throughout our organisation, we are driving a culture of safety that prioritises lives,” concludes Naidoo-Padayachee.

The Safripol team at one of the Toy Kingdom stores where pre-loved toys were collected

More than 35 000 toys were collected last year, according to Safripol’s Marketing and Executive Assistant, Peta-Ann Lord. “Having been able to run this initiative over the past two years has been a privilege and a great cause that we all look forward to every year,” says Lord. “There is no better feeling than bringing smiles to so many children’s faces from pre-loved toys. A small act of kindness that people take for granted, results in making a child’s day or for some, their whole life,” she said.

Unitrans assisted Safripol with the distribution of the toys in Gauteng, the Western Cape and KwaZulu-Natal, by picking up toys from collection points and delivering them to specific locations while sorting and safe guarding the toys on site and assisting with the co-ordination for warehousing and re-distribution. The charitable initiative will continue in 2022 with high hopes of even more toys being collected and distributed this year.

Unitrans drivers in a refresher training session using gamification learning

www.unitrans.co.za | +27 21 762 0061

F ROM T HE EDI T OR

NOTHING IF NOT RESILIENT

here is no doubt that local and global supply chains have been put through the wringer in the past two years, but the supply chain is nothing if not resilient, and it is beginning to rebound nicely. With the world still reeling from COVID-induced shocks and facing the prospect of climate change, a key theme of this issue of Supply Chain Management is the sustainability of supply chains, from both an operational and environmental perspective. The drive towards zero fossil-fuel emissions will have a massive impact in the medium term on the freight transport industry, so we look into the potential for electric vehicles in this space (page 32). We look at the role consultants play in building sustainable, visible supply chains (page 20) and the skills needed to drive environmentally friendly practices (page 59). Technology will play a huge role in these endeavours and the eternal quest to optimise supply chains. We look at how tech can complement workers (page 55), improve materials handling (page 11 and 12) advance freight forwarding (page 27) and even potentially making logistics as easy as ordering an Uber (page 49). While sustainability is only going to become more important, the one thing this issue demonstrates better than anything else is that – as on so many occasions in the past – technology looks like being the saviour of an industry that has taken its fair share of knocks in recent times. Rodney Weidemann Editor

Contents

32 TRUCKING

11 MATERIALS HANDLING

37 LOGISTICS, FREIGHT AND WAREHOUSING

15 THOUGHT LEADERSHIP: SUPPLY CHAINS

What will the supply chain of the future really look like?

18 RETAIL

After two years of COVID-disrupted supply chains, we look into what local retailers are doing to help reduce some of the strain.

20 CONSULTING

Consultants can provide the outside view you need to design and implement a resilient, sustainable supply chain.

23 FREIGHT CERTIFICATES

Investigating the types of freight certificates required for international cargo that travels by ship, road, rail, air or a combination of these.

27 FREIGHT FORWARDING

We investigate technological advancements impacting the freight forwarding industry and how these will affect contemporary logistics models.

Supply chains need to leverage new tools to create leaner, more efficient operations.

42 CHEMICALS

What does the future hold for this sector in terms of the digital solutions being implemented to achieve seamless fulfillment capability?

43 THOUGHT LEADERSHIP: eCOMMERCE How to navigate the complexities of e-commerce delivery.

49 DIGITAL SYSTEMS

We consider the technology set to make handling large-scale transport and logistics as quick and easy as booking an Uber.

A proud division of Arena Holdings Hill on Empire, 16 Empire Road (cnr Hillside Road), Parktown, Johannesburg, 2193 PO Box 12500, Mill Street, Cape Town, 8010 www.businessmediamags.co.za EDITORIAL Editor: Rodney Weidemann Content Manager: Raina Julies rainaj@picasso.co.za Contributors: Martin Bailey, Trevor Crighton, Andrew Dawson, Greg Fine, James Francis, Anél Lewis, Itumeleng Mogaki, Anthony Sharpe Copy Editor: Anthony Sharpe Content Co-ordinator: Vanessa Payne DESIGN Head of Design: Jayne Macé-Ferguson Senior Designer: Mfundo Archie Ndzo Advert Designer: Bulelwa Sotashe Cover Image: istockphoto.com, supplied SALES Project Manager: Tarin-Lee Watts wattst@picasso.co.za | +27 87 379 7119 I +27 79 504 7729 PRODUCTION Production Editor: Shamiela Brenner Advertising Co-ordinator: Johan Labuschagne Subscriptions and Distribution: Fatima Dramat, fatimad@picasso.co.za Printing: CTP Printers, Cape Town MANAGEMENT Management Accountant: Deidre Musha Business Manager: Lodewyk van der Walt General Manager, Magazines: Jocelyne Bayer

55 TECHNOLOGY

From autonomous vehicles to automated warehouse picking systems, there are many ways AI has positively impacted the supply chain.

56 THOUGHT LEADERSHIP: COMMUNICATION Seamless communications options for the South African market.

59 SKILLS DEVELOPMENT

For a truly sustainable supply chain, we must understand the skills needed, how these are acquired and which training institutions can help.

COPYRIGHT: Picasso Headline. No portion of this magazine may be reproduced in any form without written consent of the publisher. The publisher is not responsible for unsolicited material. Supply Chain Management is published by Picasso Headline. The opinions expressed are not necessarily those of Picasso Headline. All advertisements/advertorials have been paid for and therefore do not carry any endorsement by the publisher.

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We consider the changes required to ensure effective FMCG delivery, and take a look at the benefits of solutions like autonomous lift trucks and sorting systems in the materials handling space.

With the world focused on the dangers of fossil fuel emissions, electric vehicles will play an important part in their reduction.

PUBLISHED BY

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Customer satisfaction guaranteed? It’s all in the planning Customers are streaming back to shopping malls as the worst of the pandemic recedes. But they don’t always get what they want because supply chains haven’t fully recovered from COVID19 – and won’t for some time to come. Your customers, though, aren’t that interested in ports that aren’t functioning optimally or that there are fewer ships on the water that are already fully laden. They want what you make when they need it – so you need supply chain reliability more than ever. And the only way you can get that in these disrupted, disruptive times is by perfecting your planning – and collaborating closely with DSV. Our world-class systems and hands-on approach by our people on the ground in more than 90 countries will help you stay ahead of your shipment needs. Most importantly, our end-to-end supply chain reliability will keep your products on the shop shelves, ready and waiting for your customers when they want them. Visit www.dsv.com/en-za to see how we can bring reliability to your business and satisfaction to your customers, even during the most uncertain of times.

DSV – Global Transport and Logistics We provide and manage supply chain solutions for thousands of companies every day – from the small family run business to the large global corporation. Our reach is global, yet our presence is local and close to our customers. 75,000 employees in more than 90 countries work passionately to deliver great customer experiences and high-quality services. Read more at www.dsv.com/en-za

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ABOUT UNITRANS SUPPLY CHAIN SOLUTIONS

The company structure enables its aspirations through three strategic divisions: • Food and Consumer Logistics • Specialised Freight and Warehousing • General Freight and Warehousing

Unitrans, a diversified supply chain solutions company, aspires to be recognised as the leading provider of integrated operational services, leveraging its strong contractual base and strategic alliances with its clients.

Unitrans’ B-BBEE level 2 rating and procurement recognition level of 125% remains a key differentiator in the market for the company and unlocks value by supporting transformation targets.

Innovation. Expertise. Delivered.

As a trusted services partner, its purpose is to extend its range of services with existing and future customers to provide them with the space to focus on growing their core businesses. Unitrans is relentless in its pursuit to become the safest and most innovative, integrated operational services partner in South Africa, constantly unlocking value for all its stakeholders.

UnitransRSA unitrans_sa unitrans www.unitrans.co.za

Through operational excellence, leadership commitment and high levels of staff engagement, Unitrans delivers innovative, cost-effective solutions and excellent service to its chosen market segments.

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S A PIC S A DV ER T ORI A L

CONTINUOUS SKILLS DEVELOPMENT IS VITAL

In 2021, SAPICS hosted and co-hosted 86 events geared towards sharing knowledge, providing solutions, and advancing and professionalising supply chain management.

Supply chain management has never been more critical than it is today and skilled practitioners are in demand in this ever-evolving profession

n an increasingly global, challenging, complex and dynamic business environment, skilled, suitably qualified supply chain practitioners are indispensable. “Global supply chains have faced unprecedented challenges amid the COVID-19 crisis and the effects will be felt for some time. Right now, we need effective, streamlined supply chains managed by proficient supply chain professionals to ensure that products reach consumers. In the long run, organisations with optimised supply chains have a competitive advantage and can help to build thriving economies,” comments MJ Schoemaker, president of SAPICS (The Professional Body for Supply Chain Management). She notes that supply chain management has always been a constantly evolving and changing profession, so continuous skills development was important. “However, now more than ever, we are in unchartered waters, and it is vital for all supply chain practitioners to keep updating their skills sets and knowledge and honing their expertise.”

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FIT-FOR-PURPOSE EDUCATION AND PROFESSIONAL DESIGNATIONS SAPICS ensures that supply chain professionals are equipped with fit-for-purpose education, training, knowledge and know-how. SAPICS is spearheading the drive to professionalise the supply chain management profession in Africa. The process is now well underway with the first designations awarded. “By professionally designating individuals, SAPICS will increase supply chain management competence, knowledge and skills, and industry professionals will have prescribed values and ethics to uphold. Until now, the supply chain profession has been unregulated in terms of levels of competence, skills and ethics. The ongoing professional

”NOW MORE THAN EVER, WE ARE IN UNCHARTERED WATERS, AND IT IS VITAL FOR ALL SUPPLY CHAIN PRACTITIONERS TO KEEP UPDATING THEIR SKILLS SETS AND KNOWLEDGE AND HONING THEIR EXPERTISE.” – MJ SCHOEMAKER development required to maintain designations will ensure that African supply chain management keeps pace with global best practice,” explains Schoemaker.

EVENTS AND SAPICS YOUTUBE CHANNEL In 2021, SAPICS hosted and co-hosted 86 events geared towards sharing knowledge, providing solutions and advancing and professionalising supply chain management. “If you missed any of these, don’t despair because many of the SAPICS webinars, courses and Community Connect sessions can be viewed at any time on the SAPICS YouTube channel,” explains Schoemaker. Compelling topics explored in webinars and available on the SAPICS YouTube channel include the viability of automation in South Africa, considering the country’s high unemployment rate; the changing face of warehousing – locally and globally; COVID-19 vaccine distribution challenges; and the circular supply chain. Schoemaker says that belonging to a professional association like SAPICS is crucial for businesses and individuals. “SAPICS offers a platform for our members to achieve personal growth and professional development. Membership gives them access to fellow professionals that they can network with, share knowledge with and learn from. There are regional networking, social events and site visits, as well as

Compelling topics explored in webinars and available on the SAPICS YouTube channel include the changing face of warehousing – locally and globally.

member-only webinars. Members enjoy discounted registration fees for events like the annual SAPICS Conference, the leading event in Africa for supply chain professionals, and discounts on courses, workshops and education programmes. SAPICS members earn two points per year towards an International Certification Maintenance Plan.”

SAPICS YouTube Channel

About SAPICS Membership

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A DV A DV ERER T ORI T ORI A LA L S AS PIC A PIC SS

SAPICS has launched a professional designation programme that will benefit individuals, businesses and the profession

ecause supply chain management is one of business’s largest professions, with touchpoints across virtually every aspect of every industry, supply chain specialists come from a wide range of different backgrounds with diverse qualifications, from supply chain and logistics to industrial and systems engineering, business administration and sales. For this reason, standardising and advancing supply chain skills and practices across the African continent is imperative and will be enabled by the professional designation programme launched by SAPICS (The Professional Body for Supply Chain Management). The organisation has been spearheading the professionalisation of supply chain management for a number of years. “It is exciting that it is all coming together now at a time when the pandemic has put the spotlight on the importance of supply chains, not just to ensure the smooth flow of goods and services, but also to save lives,” comments SAPICS business development executive Tonya Lamb. She reveals that an elite group of South African supply chain specialists now holds professional designations.

WHAT DOES IT MEAN FOR PROFESIONALS? Elaine van der Merwe-Stout, key accounts manager at Imperial, has been awarded the designation of supply chain management advanced practitioner. She says that the professional designations will benefit

individuals, businesses and the profession as a whole. They bridge the gap between tertiary education and practical business experience gained over years of exposure to different supply chain scenarios. Due to this, the maturity of engagements will evolve to a level where all professionals speak the same language, understand the goal of a unique supply chain, and design operations practically, overcoming constraints to reach the desired outcome. “Being professionally designated showcases my level of expertise and capabilities. It boosts my confidence when dealing with logistics and supply chain peers and motivates me to continuously enhance my skills and knowledge to be the best I can be. It also creates hope for advancement in my career through competency recognition.” On the benefits for her company, van der Merwe-Stout says: “It shows that my organisation employs people who are committed to advancing themselves in the logistics and supply chain profession. When this commitment to supply chain excellence is recognised by clients, it can increase the likelihood of them choosing us as their business partner of choice.” James Tubb, head: supply chain at Barloworld Equipment, has also been awarded the professional designation of supply chain management advanced practitioner. He believes that a professional designation once fully accepted and recognised in the industry will

“THE RISE OF THE SUPPLY CHAIN PROFESSION IS UNDERWAY, AND I BELIEVE IT WILL CONTINUE TO GAIN MOMENTUM IN THE COMING YEARS.” – TONYA LAMB 8

➔ Scan this QR code to go directly to the SAPICS website.

For more information: 011 023 6701 info@SAPICS.org.za www.sapics.org

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PROFESSIONAL DESIGNATIONS FOR SUPPLY CHAIN EXPERTS

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Supply chain specialists come from a wide range of different backgrounds with diverse qualifications.

be a good indicator of a supply chain expert’s knowledge and will be an advantage in terms of employment prospects. “As more companies learn to recognise the value of individuals with the professional designation, and the levels of skill, experience and knowledge associated with that, they will start to look at the designation as being an employment criterion and possibly a requirement for career advancement.” Service delivery director at Qwix Technology Sean van Harmelen has been awarded the professional designation of supply chain management executive. “It is difficult to judge supply chain practitioners’ experience, knowledge, commitment and integrity. I believe that supply chain designations are a great step towards the maturity of the supply chain profession. For me, it is a way to benchmark myself, give credibility to my experience and knowledge, demonstrate my commitment to the supply chain community, and show my dedication to lifelong learning. Professional designations will improve the quality of supply chain professionals and enable their growth and advancement,” he says. Yash Patel, industrial engineering manager at SPAR South Africa, says that continuous learning is vital in this constantly changing world. He recently was awarded the professional designation of supply chain management advanced practitioner. “This professional designation will allow me to keep up with the latest trends in technology and best practices in the dynamic supply chain profession. It will also provide the opportunity to network with like-minded professionals and better map out my career path,” he states. “Professional designations will also provide employers and recruiters with a better understanding of the requirements of specific supply chain roles. A professional designation is important for establishing a good code of conduct, ethics and standards that protect clients and customers,” Patel says. “The rise of the supply chain profession is underway, and I believe it will continue to gain momentum,” Lamb concludes.

S A PIC S A DV ER T ORI A L

PURPOSE-DRIVEN

SUPPLY CHAINS SAPICS has announced that the theme of the 2022 SAPICS Conference is “Purpose-Driven Supply Chains”

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frica’s leading event for supply chain professionals, the annual SAPICS Conference, takes place from 12 to 15 June 2022 at the Century City Conference Centre in Cape Town. The theme for the 2022 conference is “Purpose-Driven Supply Chains”. Expanding on the theme, SAPICS (The Professional Body for Supply Chain Management) president MJ Schoemaker says: “The VUCA (volatile, uncertain, complex, ambiguous) world in which we are living right now has thrown supply chain management into the spotlight across the world. Supply chain agility and transparency have become more critical than ever before to ensure that our customers are served. The impact of the

pandemic – which brought unprecedented supply chain disruptions and exposed the vulnerabilities in many organisations’ supply chains – will be felt for a long time. Organisations are looking to become purpose-driven. This means delivering value and profi t to stakeholders while maintaining a focus on responsible practices that affect the planet and people. Supply chains are the real opportunity to enable change. The annual conference is the place to learn how, and to connect with experts and peers who can help organisations and supply chain professionals to create and sustain purposedriven supply chains,” Schoemaker explains. “There will be some online elements, but we are hoping that the supply chain

“ORGANISATIONS ARE LOOKING TO BECOME PURPOSE-DRIVEN. THIS MEANS DELIVERING VALUE AND PROFIT TO STAKEHOLDERS WHILE MAINTAINING A FOCUS ON RESPONSIBLE PRACTICES THAT AFFECT THE PLANET AND PEOPLE.” – MJ SCHOEMAKER

SAPICS is hoping that the supply chain community will be able to gather in person again to learn, network and share knowledge at the 44th annual SAPICS Conference.

community will be able to gather in person again to learn, network and share knowledge at the 44h annual SAPICS Conference.”

EARLY BIRDS CAN CATCH SAVINGS Discounted “Early Bird Registration” for the event is being offered until 31 March 2022. Delegates who book their place before this will get a substantial discount on their conference registration fees. “Recognising the financial challenges facing many organisations right now, SAPICS has gone back in time for this year’s conference and delegates will notice that the registration fees are the same as they were in 2018,” Schoemaker concludes.

➔ Scan this QR code to go directly to the SAPICS website.

For more information: 011 023 6701 info@SAPICS.org.za www.sapics.org

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Materials handling in the FMCG space RODNEY WEIDEMANN unpacks changes and challenges around handling goods in this dynamic space

ver the past two years, there has been a massive rise in the purchase of fast-moving consumer goods (FMCG) online, driven largely by COVID-19 restrictions. This has obviously had a significant impact on the warehousing and materials handling aspects of the supply chain. The pandemic certainly initiated a dimension shift within the FMCG industry. Consumers turned to online purchasing out of necessity, quickly forcing retailers to embrace digital transformation in order to keep businesses afloat. Almost two years on, many consumers still prefer the online space out of convenience. Mishen Naidoo, engineering and solutions manager at Manitou Group, says material handling in warehouses traditionally followed a more predictable pattern: orders were placed in bulk by retailers and consumers bought off the shelves of these retailers. Online shopping by individual consumers brings in the factor of unpredictable buying patterns, along with consumer expectation of quick fulfilment. “Handling material has shifted focus towards warehouses and the equipment required for these to run smoothly,” explains Naidoo. “This in turn has placed a bigger demand on smaller forklift and order-picking equipment.” Rapid expansion and not being “left behind” have also presented challenges for the industry. This obviously comes at a cost, notes Naidoo, so warehouses have been forced to spend their capital on expanding storage space, purchasing and upgrading equipment, and increasing their staff complement. “Warehousing, like many operational spheres, has embraced digital transformation and evolved into ‘smart warehouses’. This includes connected machines, which can aid in reducing ownership costs, planning timeous servicing and preventing destructive operator behaviour. In some instances these connected machines are autonomous and need no operator interaction. “The key lesson from the experience is that adaptable, agile businesses are the ones that survive during tough times. Effective stockholding, inventory management and capacitymanagement chains are key.”

Handling e-commerce for the informal sector Just before the pandemic struck, Unilever had launched a project in conjunction with ParcelNinja to begin moving FMCG products into the informal sector. The idea was to get products as

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“The key lesson from the experience is that adaptable, agile businesses are the ones that survive during tough TIMES.” – Mishen Naidoo

Mishen Naidoo, engineering and solutions manager at Manitou Group

DID YOU KNOW?

The materials handling process for FMCG has become increasingly complex, in order to keep up with unpredictable demand while still maintaining an element of precise and speedy fulfilment processes – all while still keeping costs low. This has meant that warehouse owners have placed extremely stringent maintenance regimes on their material handling equipment. Source: Manitou Group

close to the end user as possible, as this is a sector that doesn’t really have access to e-commerce. ParcelNinja MD Greg Fine explains: “Unlike standard e-commerce, the products here go to the spaza shop, rather than direct to the home. While the consumer would purchase as normal from the spaza, the shop can now can place orders electronically with a rep or via a digital channel, and get stock delivered while the shop continues to trade – as opposed to the owner having to lock up the store and go out to acquire new products.” Fine says this market is entirely based on cash-on-delivery. “Sometimes, when the driver arrives, the owner has no cash available – either because they have already purchased other stock, or suffered from bad sales that day. What we are trying to do is digitise this supply chain, working with financial service providers to secure funds before the delivery driver leaves. This means that every delivery should go off according to plan, instead of being sent back due to lack of funds, while also eliminating cash from the supply chain, reducing the risk of theft and hijacking.” Fine notes that orders are captured in the field on a device by the sales rep or pushed to an online channel like a website, and received in real time by Unilever. The picking and packing is done immediately by ParcelNinja, and the delivery is allocated to one of its owner/driver courier partners. “These couriers receive the waybills on technology we provide to them, using the same software that is used to place orders with Unilever via their platform. Even in the midst of COVID-19, the project has seen orders grow from around 200 per day at the beginning to some 1 300 orders per day now. It is currently only operating in Gauteng, so there is much more to come. “Best of all, given the current state of the economy, is that this solution has impacted job creation significantly, creating a need for more drivers, sales reps and warehouse staff,” Fine concludes.

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Automating and optimising

supply chain operations

he implementation of modern technologies such as artificial intelligence and the Internet of Things has seen the supply chain environment improve significantly in terms of efficiency, accuracy and speed. This is according to logistics systems manager at Jungheinrich South Africa, Mike Botoulas, who says that distribution and fulfilment centre environments have, in recent years, seen the benefits. These modern technologies have helped reduce product handling errors, increase throughput and streamline operations. These gains have a material impact on customer satisfaction, as customers are now receiving their products quicker than expected. “It is also important to understand that modern technologies allow companies to gather and analyse large amounts of data,” says Botoulas. “This helps optimise their operations and formulate strategies to best meet and exceed customer and market demand.” Kerr Walker, managing director of Interroll South Africa, says that at some stage, material handling organisations quickly realised that just adding labour does not necessarily solve the issue of getting a parcel from point A to point B in an effective way. Mechanisation or automation is required to meet the demands of various parcels, dimensions and weights. Furthermore, the speed that companies require is no longer possible with human staff alone. However, Walker also points out that mechanisation and automation should never replace the human element, but rather allow an organisation to grow without increasing workforce. “The return on investment for this process doesn’t usually involve reducing the workforce. In many cases, it makes them far more efficient.”

The right fit for the job Botoulas says that, both locally and internationally, workforce shortages occur in jobs where the work is considered gruelling or physically taxing. It is here where automation has filled a void. “We believe that, overall, jobs

Automatic reference RIKA

FAST FACT

It is projected that the annual revenue of the lifting and handling equipment manufacturing industry in South Africa will amount to approximately R12-billion by 2023. Source: Statista

will not be made completely redundant through the implementation of automated warehouse solutions. We need to consider our high unemployment levels in South Africa too, and it is our goal that automated solutions result in the empowerment and upskilling of staff.” Walker gives the example of a piece of an Interroll system for sorting materials. This solution is specified in terms the number of units required per hour, as well as the number of destinations, routings and areas of distribution. “We recently launched our new addition to the family: a split tray sorter. This is specifically designed for products below 12kg and mostly used in distribution of clothing.”

“Modern technologies allow companies to gather and analyse large amounts of data.” – Mike Botoulas 12

WHERE TO AUTOMATE There are numerous ways in which artificial intelligence, robotic process automation, automated vehicles and big data help to drive optimisation for both direct warehouse operators and the greater supply chain. • Manual operations: These include the pick, pack and despatch areas of a distribution centre. They benefit from software and system implementations such as warehouse management systems, which integrate with technologies such as pick-to-light, voice picking or handheld scanner technology. • Semi-automated operations: Storage and retrieval functions represent an example. In conjunction with the operator and material handling equipment, technology is implemented to ease the operator’s workload. While the operator drives the machinery forward and back, the technology will ensure the correct lift and retrieval of the product. Additional solutions include goods-to-person systems, vertical storage units, and mechanical conveyor and sortation systems. • Fully automated solutions: These include automated storage and retrieval systems, automated guided vehicles, automated mobile robots and mini-load systems. In these solutions, human intervention is kept to a minimum. The operation is run as a fully automated site, maintained by hardware and software engineers who ensure uptime and maximum productivity.

Botoulas adds that, as an end-to-end intralogistics solution provider, Jungheinrich offers customised solutions to all material and information flow requirements within a warehouse. “As a result, our solutions are designed to withstand current supply chain operating conditions, while still being flexible and agile enough to scale and optimise to meet and fulfil the industry evolution we are witnessing. We are well positioned to lead the change within the industry.”

IMAGE: SUPPLIED

Automation is either going to save business or destroy jobs on a wholesale scale, depending on who you believe. ITUMELENG MOGAKI looks at its impact on the supply chain

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T HOUGH T L E A DERSHIP

Technology and the

supply chains of the future MARTIN BAILEY CFILT, vice president of the Chartered Institute of Logistics and Transport: South Africa, ponders what impact technology will really have on supply chains

M IMAGE: ISTOCKPHOTO.COM

any experts have been discussing the so-called “supply chain of the future”, asking questions like: How will it be different to our existing supply chains? What’s happening to our systems? What will digitisation do for our supply chains? Let’s look at our supply chains a little more realistically. Until we develop some science-fiction methods of “beaming goods”, Star Trek style, to customers, or devise some way for customers to print their own food, supply chains will largely remain in the realm of moving boxes. It’s really hard to digitise any physical entities – and the supply chain is about moving physical stuff. So what is really happening? Perhaps the greatest influence across the supply chain is the explosion of stock keeping units. Ten years ago, you would find three types of peanut butter on the shelf. Now we have crunchy, smooth, chocolate flavoured, almond, cashew and 20 other types – from a wide range of suppliers. This really complicates the supply chain. Add to this the ability to shop on an unlimited internet, and the choice grows exponentially. In parallel, customers have changed, with “I want it now” culture permeating the network. Thus, more stock, smaller and faster deliveries, and less tolerance translate to more constraints within the supply chain.

What’s really relevant? From a technological point of view, we are still constrained by the physical limits imposed by the nature of products. We still need ships, containers, aircraft, pallets, trucks, trains, warehouses,

We still need ships, containers, aircraft, pallets, trucks, trains, warehouses, bins, boxes, packaging and so forth.

bins, boxes, packaging and so forth. The metaverse is changing the nature of customer demands and facility configurations, but in general, the physical supply chain is unlikely to change radically. In South Africa, e-commerce volumes are fairly small (still typically below 5 per cent of retail sales) – largely a result of economic and social constraints. Even if these triple, they’re not going to upend the country’s supply chains. Growth of technology like artificial intelligence and machine learning will certainly drive much better planning. These are already being used in forecasting and inventory optimisation, and will start moving into fields such as transport and warehousing planning and optimisation. Nonetheless, this is unlikely to lead to revolutionary changes. How about automation? Certainly, trends in this direction will change some activities. Driverless trucks look to be 10-20 years away, and some components of warehouse automation are fairly easy implement, though in South Africa these can be difficult to justify. Over time, we are certainly going to see more automation – but no wholesale changes. Initially we all believed that the Internet of Things would have great applications in the supply chain. We can stick an RFID – or, more recently, a low-energy Bluetooth – chip on everything, then wave a magic wand and tracking, security and stocktaking are massively simplified. However, other than in a few areas such as security and clothing, the technology has not really worked. We are thus stuck with simple barcodes.

Crisis stations? What about the present worldwide supply chain crisis? It appears most of the problems are a result of political interference in market conditions over the COVID-19 era. Many Western governments encouraged workers to stay at home, but reimbursed these workers. As COVID diminished, demand increased, along with disposable income provided by governments. The increased demand caught a “pandemic dormant” manufacturing and supply chain sector by surprise. As the market settles, I believe this will disappear. In the future, I expect the two biggest challenges influencing the supply chain will be: • Growth in worldwide demand as the world gets richer – the challenge being to handle both increasing volume and greater variety. • Push to make supply chains as green as possible, by reducing carbon emissions and waste across all aspects of supply chains. Unfortunately for the supply chain industry, I do not expect to see any wholesale changes brought through digitisation or any new world orders in the next decade. But then, my predictions may be wrong.

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The retail

supply CHAIN’S recovery From weathering the knock-on disruptions of the pandemic to planning for an unpredictable future, ANTHONY SHARPE looks at what retailers are doing to keep the shelves stocked

h, to be a retailer these days. From changes in consumer behaviour and other disruptions brought about by the COVID-19 pandemic, to spiralling shipping costs, stop-start production and issues with Chinese imports, it’s been a bumpy road for the past two years. We’re not over the hill just yet, so retailers are still having to learn, adjust and plan accordingly.

The COVID effect Simply put, global supply chains are still nowhere near as resilient as they were prior. The reasons for this are myriad and complex. “When COVID hit, all the retailers cancelled orders with suppliers locally and internationally because they were afraid they would end up overstocked with goods they couldn’t sell,” says Jan Tukker, managing director of supply chain consultancy BusinessChain. “Then when the supply chain opened up, the flow of goods was not as smooth and regular as it was in the past, a lot of which has to do with container availability and increased shipping costs.”

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Tukker says although retailers won’t have their optimal stocks in stores yet, “they’re certainly on the way to recovery, and turnover in a lot of these companies is quite good considering what they’ve been through”.

Shipping costs If there’s one thing that’s hit retailers hard – and will hit consumers in time – it’s shipping costs, which have skyrocketed since early 2020. This has predictably thrown many a retailer’s recovery plans into disarray. “It’s put everyone on the backfoot,” says Andrew Dinnie, sales director for DSV Air & Sea. “Retailers are still trying to plan their supply chains around what the freight cost was. How does a merchandiser, planner or product category specialist contend with freight costs that are now significantly impacting the cost of their product? They can’t put products on shelves at the same prices as before. I think that’s where the food and consumer brand retailers are really battling now.”

FRIGHTENING GLOBAL FREIGHT RATES Global average freight rates increased more than tenfold from July 2019 to September 2021, when they peaked at almost R155 000/FEU (forty-foot equivalent unit, a standard intermodal container size), before easing slightly to R144 000 in January this year. Source: Statista

Dinnie says retailers are now pushing back and cancelling orders because they can’t afford these costs, which means products aren’t on shelves and sales are lost. There are a number of reasons behind these soaring freight costs. From a South African perspective, the size of our market really doesn’t help. “Because the South African trade lane is so small, we’re severely impacted when carriers choose to serve the larger trade lanes like Europe and the US instead,” says Dinnie. Moreover, supply chain issues in Europe or the US will have a ripple effect on South Africa. “The Omicron variant has hit Europe hard, and their issues around terminal capacity and labour mean they can’t serve the carriers correctly, leading to delays. This has resulted in container equipment and large-capacity vessels being taken off the South African trade lane to service the larger ones.” This means that the vessels serving our trade lane are smaller, which creates a general constraint on carrying capacity. “The carriers will pitch their prices in terms of the supplydemand economy curve, which is what is creating this freight rate crisis,” says Dinnie. “There’s general consensus that it’s not going to improve this year, and may run into the first quarter of next year too.”

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2022/03/16 10:29 AM

RE TA IL

ARE THINGS CLICKING YET? Jan Tukker of BusinessChain says that while a lot of retailers have pivoted to online in response to the COVID-19 pandemic, the growth in this area hasn’t been like that in First World countries. “The online turnover for local fashion retailers was around 2.5 per cent of total turnover. When the pandemic hit, that climbed to above 5 per cent, but not the more than 50 per cent that Marks & Spencers in the UK reported last year. Since then, it’s normalised to 3.5-4 per cent. Nevertheless, a disproportionate amount of IT budget is being spent on developing these capabilities.”

Local flavour

IMAGES: ISTOCKPHOTO.COM, SUPPLIED

Service integrity Freight carriers have been affected by a host of factors including COVID-19, port delays and closures, and Transnet issues, impacting the quality of the service. “The service integrity of ocean freight carriers has been severely challenged,” says Dinnie, referring to the reliability with which a ship will visit every port on its itinerary. Two or three years ago, freight movers would be happy with an average service integrity of 90 per cent; now they’re battling to get 40 per cent. “You can’t plan,” Dinnie continues. “We have to explain this situation to retailers. Normally, you’d plan for whatever trade lane made sense in terms of consistency and transit times. We now have to add three-to-six weeks’ buffering time. There’s no more just in time any more; everything is just too late.” Freight movers are under huge pressure to move cargo, says Dinnie, but right now a large part of their role is providing intelligent information so retailers can plan accordingly. “We all have to plan in way more detail, way earlier. We want to part of the planning conversations with retailers so we can feed them better information, so they can plan better.” Bringing stock in earlier doesn’t necessarily solve the problem either, because if everybody thinks the same, then there’s a rush on demand earlier in the year, which creates issues.

FAST FACT

“It’s about trying to spread your orders evenly so you don’t get caught out, so you have a more frequent supply of your various categories,” Dinnie explains. “That way you can keep your supply chain going, have product on the shelf and maintain sales.”

Source of the issue It also matters where those goods are coming from, says Dinnie. “Our message to a lot of retailers is you have to reconsider your total reliance on China. You need to spread your risk and your sourcing strategy to other areas that are more reliable. A lot of retailers don’t want to do that because it’s too expensive.” Like it or not, nearshoring or localising production is a strategic imperative for many retailers, says Tukker. However, he says, South Africa’s productivity level needs to be able to match that of the manufacturing giants in the East. Increasing local production will obviously generate employment and, crucially, it will shorten the time span between ordering and selling goods. “The longer this time span, the harder it is to get the fashion right,” explains Tukker. “From overseas, you need to order six-to-nine months in advance and commit to a colour and a design, but locally you can pivot between different looks that you know will sell better, which results in a lower markdown ratio.”

South Africa ended 2021 with a trade surplus of R30.1-billion, down from a high of R53.8-billion in March, but far greater than the R13-billion of January.

One retailer that isn’t afraid to localise is TFG. The pandemic has certainly provided greater impetus, but the group has been on this journey for a long time, says Graham Choice, managing director of TFG Merchandise Supply Chain. “I think the mindset among retailers is totally different now to what it was pre-pandemic. Merchandise from other countries always seemed better, but the grass isn’t always greener. You’ll find that these forays into the rest of the world can be helpful when the opportunity is right, but they’re also incredibly challenging. We quickly realised we could control things better if they were local.” TFG’s localisation journey started more than a decade ago, says Choice, who was CEO of CMT manufacturer Prestige Clothing when it was was acquired by the retail giant. This gave the company a local manufacturing footprint, one that they’ve been developing ever since. “Last year we bought bedding brand Granny Goose and its manufacturing arm, Cotton Traders,” says Choice. “We know a factory that is interfaced with a local retailer is a winning recipe. If you’re going to rely entirely on planes, ships and middlemen, you lose control and your value offering is diminished.” Choice says you don’t necessarily have to own factories, but TFG has exclusive relationships with many 100 per cent supply partners. “We don’t want to share the intellectual property that we develop together. Furthermore, if you want to do quick response in apparel, it’s a very difficult set of processes to share a manufacturer with another retailer that wants to order on a long lead time. But it works for us, because we have a developmental strategy with our supply chain, rather than a transactional one. If you want to depend on your local supply chain, you need to think and develop it in this way,” he concludes.

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CONSULT ING

Visibility is key to sustainability RODNEY WEIDEMANN looks at the critical role consultants play in driving more sustainable supply chains

Source: Anton de Klerk, EY

relevant ideas and plans in the right manner to be presented to the board. “This can cause conflict, but it’s important to view sustainability as a competitive advantage and a big driver of transformation projects too,” suggests de Klerk. “This means viewing it less as a regulatory issue than a value-added approach. Don’t make it a box-ticking exercise, but rather a fundamental part of the value proposition you offer to your customers and shareholders.”

Sustainability and efficiency Benatar notes that sustainability in the supply chain is often focused on the sustainability of materials and equipment used in manufacturing. However, there is a bigger picture in designing a sustainable supply chain in terms of processes and resource use. “One of the fundamentals we focus on is that designing efficiency into the supply chain is effectively critical to sustainability. An efficient system will use less labour, energy and space, along with fewer machines. “The consultant that focuses on efficiency and the best solutions – rather than on a solution that merely sells a lot of specific equipment – increases opportunities for efficiency and helps design sustainable solutions to address environmental concerns,” he adds. De Klerk points out that sustainability is a complicated matter including decarbonisation and usage of natural resources, product

“Remember that if you don’t truly understand your challenges around sustainability, you can’t fix them.” – Anton de Klerk 20

• Decarbonisation: There are strong drives towards renewable energy and properly measuring emissions. • Sourcing: The focus here is on ethical and sustainable sourcing. • Traceability: This means knowing exactly where your products have come from. • Circularity: As far as possible, you want a closed-loop supply chain, with as little waste as possible. • Regulatory taxes and incentives

ingredients, contributions to deforestation and the waste you create. “Its a very complex issue, which is why the sooner you link it to your corporate strategy, the sooner you can determine your responses to it and put in place clear, actionable activities and approaches over the short, medium and longer term.”

Closing the circle The circular economy is a growing topic in South Africa and across the world. Consultants can offer a wide-angle view in this regard and play a key role here, such as ensuring your reporting is correct in order to help you avoid fines, says De Klerk. “It’s also worth mentioning that consultants are able to leverage international best practice around issues like the circular economy, because there are other markets that are more mature. Remember that if you don’t truly understand your challenges around sustainability, you can’t fix them. You need visibility, which is what a good consultant provides.” Benatar agrees, adding that a consultant, if focused on building a resilient and sustainable supply chain, can certainly craft a process to help you achieve both a good business return on investment (ROI) and a strong green ROI. “With the correct approach and the ability to measure the end-to-end supply chain – rather than just at an individual component level – the overall green supply chain can often be cheaper, more circular and sustainable. You just need to focus correctly, and it is this focus that a consultant offers,” Benatar concludes.

IMAGE: ISTOCKPHOTO.COM

n a world where the supply chain is already evolving rapidly, companies now have to also focus on sustainability and other environmental concerns. Under such conditions, designing an efficient, sustainable supply chain is more crucial than ever. According to Gary Benatar, CEO of consulting and infrastructure design firm Relog, consultants have never been more necessary. “Consultants bring a wide base of experience to companies, in that they broaden the view of what is possible, based on their experience and exposure to other ideas, solutions and experiences – as opposed to a company that might have a blinkered view of its own operations.” Anton de Klerk, EY Africa supply chain field of play leader, agrees. “Organisations don’t always have the visibility of their operations required to understand and build resilience and sustainability into their supply chains. Consultants can offer an end-to-end view of exactly what makes a business resilient, while helping them to become even more so.” Clients often work in silos (meaning functions focus on their own jobs and don’t really link up across functions), something De Klerk points to as the enemy of resilience. Consultants, however, can work across and objectively connect these silos, helping to drive more value chain thinking throughout the organisation and enabling it to improve its resilience. They can also help to package

KEY FOCUSES OF A SUSTAINABLE SUPPLY CHAIN

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DOCUMEN TAT ION

FAST FACT

In response to the COVID-19 pandemic, merchandise in Africa trade dipped 16 per cent in value in 2020, compared with a global average of 7.6 per cent. Source: World Trade Organization

Getting your papers in order Accurate freight documentation is essential to passing customs, levies and taxes getting paid, and ensuring the smooth flow of goods between countries, writes ANTHONY SHARPE

n any sort of trade scenario, there’s typically a lot of paperwork to have in order. However, the most important documents for customs clearance purposes are the commercial invoice and the transport document (the airway or ocean bill, road consignment note or rail note). “These are the two critical documents for customs clearance,” says Vincent Zikhali, senior customs manager at Barloworld Logistics. “In addition, a certificate of origin might be required and/or what is called a EUR1 certificate/movement certificate, which determines the origin of the product.” Zikhali says an import permit will also be required, but this depends on the particular country and whether or not the goods are controlled.

Free to trade

IMAGES: ISTOCKPHOTO.COM, SUPPLIED

Free trade agreements allow for the buying and selling of goods across borders with the minimum of tariffs, quotas, prohibitions or subsidies. Proper documentation makes this all possible. “If the member countries are both members of a free trade agreement, the certificate of origin and movement certificate play a very important role in enabling the goods to enjoy a preferential duty rate and/or benefits,” says Zikhali. These certificates are not difficult to obtain, but traders need to bear in mind the rules of origin, which are agreed upon between member countries Vincent Zikhali and used as a framework to determine the originality of the product. “At a high level, the framework for the rules of origin is normally the same in all free trade agreements,” elaborates Zikhali. “However, these rules do get broken down per product or tariff code at a manufacturing or processing level so that the trader can determine whether – based on the input materials and all the processes to manufacture the product – their product qualifies to be determined as originating from the member state.” If the product qualifies, the trader can apply to the customs authorities for the certificate of origin or movement certificate. “Take note that some customs authorities do sometimes outsource this function – for example to the chamber of commerce or similar entity – but in South Africa, our customs authority is responsible for issuing these,” says Zikhali.

DID YOU KNOW?

The Automated System for Customs Data (commonly known as ASYCUDA) is a computerised customs management system that deals with manifest and customs declarations, accounting, transit and suspense procedures. It’s used by more than 20 states across Africa – though South Africa is not one. Source: ASYCUDA

Country to country Ensuring the correct documentation for country of origin is all well and good, but traders must also ensure they comply with customs procedures in every country through which their goods pass, says Robbie Forbes of Transcom Services, OGEFREM DRCappointed principle agent for Southern and Central Africa for the Democratic Republic of the Congo. “To ensure compliance, most importers and exporters make use of freight forwarders in the countries being transited and the ports of exit or arrival,” says Forbes. “You’ll find most of them know exactly what is required, because if a shipment is held up anywhere, that’s the last time they’ll be used by that client.” Transiting numerous countries, unfortunately, carries with it some risks. “Goods may be exported from China, for example, and documented to arrive in the DRC,” explains Forbes. “But they never arrive, instead being sold off somewhere along the way. These goods end up in a transit country, but duties and VAT are not paid because the product is unknown to the authorities.” Forbes adds, however, that proper customs documentation in conjunction with enforcement at borders can bring about effective control.

Levelling the playing field It’s no secret that intra-African trade is essential to economic growth across the continent. In terms of the regulatory environment, Forbes says things are improving greatly throughout Southern and Central Africa through groupings like the Common Market for Eastern and Southern Africa and the Southern African Development Community. “The playing field is being levelled for shippers, importers and exporters, which promotes equal opportunity trade for all. At the same time, regulations are in place that ensure the correct taxes are charged in the countries of transit and arrival. Coupled with the proper documentation, this contributes to the fiscus of all these countries for improving infrastructure, which further promotes investment while enhancing the lives and opportunities of the regional populace.”

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F REIGH T F ORWA RDING

Freight forwarders slow in adopting advanced technologies While the industry as a whole is relatively slow at adopting the latest technologies, there are hopes 4IR will change this, writes ITUMELENG MOGAKI

espite the excitement they might generate, advanced technologies such as artificial intelligence (AI), blockchain, the Internet of Things, drones, virtual reality, and 3D printing have not yet changed the way the extended supply chain operates. “Shipping and freight forwarding are characteristically quite slow in adopting digital technologies,” says Jacob van Rensburg, business analyst at the South African Association of Freight Forwarders. “We like to call these advances ‘disruptive technologies’, because although they are innovative, they disrupt the way we do business.” Van Rensburg says most leading thinkers in the industry believe these innovative technologies will likely transform supply chain management over the next five years. Despite these expectations, though, implementation of many of these has been in a pilot or alpha phase, with continuous development taking place.

IMAGES: ISTOCKPHOTO.COM, SUPPLIED

Man vs machine? Some individuals in the industry fear technology will render large groups of people unemployed. Van Rensburg says such fears are unfounded. “Far from eliminating jobs, most experts believe that there will be a significant net increase in employment, with most jobs being transformed by technology into higher-skilled ones. These shifts make it imperative that we prepare people for such jobs.” However, Markus Niewoudt, chartered member of the Institute of Logistics and Transportation, says that in a couple of years, the human factor will be replaced by AI, reducing the industry workforce even more. “We already have robots that control construction machines, self-driving

ELIMINATING THE MUNDANE By taking over the grind of monotonous and repetitive tasks – which abound in the logistics industry – technology implementation will free humans to do more challenging work, such as interfacing with customers, developing better products and managing technology to improve efficiency,” says Jacob van Rensburg of the South African Association of Freight Forwarders.

trucks, and ships and aeroplanes that steer themselves by means of autopilot.” Niewoudt adds that there are numerous factors, though, that are curbing the rollout of fully autonomous systems and it will take some time till we reach that point. “For example, the advanced driver assistance systems meant to enhance safety systems like automatic emergency breaking and blindspot monitoring still require a driver to monitor and supervise them.”

Major changes “As per Statistics South Africa, there are approximately 903 000 people employed in the local transportation industry, of which approximately 51 000 are truck drivers. “The freight forwarding industry in South Africa is huge, with plenty of opportunity for growth,” says Niewoudt. “Automation will have a catastrophic impact on the trucking industry, not to mention across the entire transportation industry.” Charles Dey, executive director of the Chartered Institute of Logistics and Transport

“Far from eliminating jobs, most experts believe that there will be a significant net increase in employment, with most jobs being transformed by technology into higher-skilled ones.” – Jacob van Rensburg

South Africa, says that the major changes impacting supply chain management include: • Online retailing: An exponential rise in online shopping and retailing has led to demand for improved levels of customer service, requiring delivery of high-standard goods at competitive prices within the shortest delivery times. • Automation of equipment and facilities: Human-operated machines and facilities are gradually being replaced by autonomous vehicles and freight-handling equipment. • Digitalisation of processes: All processes, from the time an item is ordered until the final product is delivered, are connected via a common digital platform, which connects not only internal functions but also external third-party suppliers of goods and services. • Integration of functions: Within companies there is a trend towards breaking down the silos that have traditionally separated departments, so that all focus is on the common goal of customer satisfaction. Supply chain management is becoming more of a management philosophy than an executive function. • Mitigation of climate change and environmental destruction: A driving force behind much of how companies are changing the way they do things is the recognition that environmentally harmful practices, processes and procedures must be eliminated or at least minimised.

FAST FACT

The African Continental Free Trade Area is a free trade area that commenced on 1 January 2021. Created by 54 of the 55 African Union nations, it is the largest free trade area in the world, in terms of the number of participating countries, since the formation of the World Trade Organization. Source: World Trade Organization

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The Road Freight Association Making the Road Freight Industry work for you!

The Road Freight Association was established in 1975 to support its members who are, in the main, road freight operators. It is a lobbying and negotiating body which influences the state of the industry, rates, upkeep of the road infrastructure, road safety, freight security, driver interests, cross-border transport, education, health, the fuel price, law enforcement, labour relations and many other issues related to road freight transport. The Association’s member companies include small and medium-sized trucking companies, including many family-owned businesses, owner operators, as well as most of the largest trucking companies in South Africa. RFA members come from all sectors of the trucking industr industry. Operators transporting goods for gain, as well as private operators belong to the RFA. The RFA’s membership also includes a significant number of affiliates and associates - those companies providing goods and services to the trucking industry. The RFA is committed to serving you. Our staff and team of experts bring a high degree of professional experience, knowledge and dedication to the Association, which assists in the effectiveness of the RFA. As the voice of the trucking industry in South Africa, the RFA is your voice. Use it today!

RFA Vision The VOICE of the road freight industry in South Africa

Mission • To be the collective voice in the interest of our members and industry; • To create a social partnership with government and promote a regulatory environment which supports growth in the industry, • To strive to promote professionalism, excellence and safety in the road freight industry

• • • • • •

Core Values • Independence • Service Orientation • Integrity • Sustainability

RFA Objectives

• Professionalism • Transparency • Respect

• •

Add sustainable & professional value to the road freight industry based on sound research; Promote transformation of the road freight industry; Support the growth of small businesses; Provide a collective voice to represent the needs & interests of Members; Collectively tackle industry-related issues on behalf of Members; Encourage Members to adhere to the RFA core values and relevant professional standards; Entrench a social partnership between Government, organised labour and the road freight industry; and Promote road safety and sustainable environmental initiatives in the road freight industry.

RFA Membership Benefits Why should I belong to the RFA? is a question frequently asked – by both members and potential members. Here are some of the key benefits the RFA membership offers:

Lobbying and Negotiation:

Through tactical lobbying, the RFA makes sure that the interests of operators is protected and addressed at the right levels of government up to the highest office in the land.

Labour Relations:

Through collective bargaining, the RFA negotiates all labour matters that influence the road freight and logistics industry. Our labour experts give guidance and advice on all labour-related matters.

Networking Opportunities:

• Social events (golf days, convention, etc). • Website platform to business, offering opportunities & business linkages • Regional meetings to ensure face-to-face contact with our team members • Social media platforms sharing latest industry updates & news

Technical and Operational Expertise:

Our team gives advice and guidance on all technical and operational matters such as: • All aspects of road transport legislation (AARTO, customs, abnormal loads, dangerous goods) • SANS Standards • RTQS Programme • Green trucks • Safe trucks • Clever trucks • Maxi trucks

Vehicle cost schedule:

Specific templates to customise the cost for 81 different vehicle concepts. Note: the data provided is based on a hypothetical model derived from publicly available information using assumptions and methodology determined by an independent expert – it is not a price calculation tool and is not intended to, nor does it, reflect or determine the actual prices that may be charged by an RFA Member or any transport company rendering transport services.

AARTO and Smarter Trucking Workshops: Preferential rates for:

• SMME starter kit • Services from transport consultants (contract assessment & route planning analysis software) • Contract pricing and indices Model prepared by Economists.co.za • Labour related matters (skills development fund, employment equity, disputes) • B-BBEE consulting • Seminars, workshops, conferences, social events & information sessions • Retirement funding • SANS1395 certification

Publications and Communication:

Newsletters, press releases, electronic industry up dates, access to online petitions. Input & feedback into impending legislation / policy pronouncements. Various social media platforms

Competition Law Guide:

Competition law guide compiled by experts specifically for the road freight industry

Small Business Support:

Support & guidance to SMME operators (telephonic, personal, electronic interaction)

Wellness programme:

Access to the Wellness Fund & Trucking Wellness through the partnership with the the National Bargaining Council for the Road Freight and Logistics Industry (NBCRFLI)

For more benefits, press releases and updates visit our website www.rfa.co.za. WITHOUT TRUCKS, SOUTH AFRICA STOPS!

For more information on how you could become a member contact us on any of the following methods: The Road Freight Association Tel: 011 974 4399 - Email: enquiries@rfa.co.za - Web: www.rfa.co.za

Always Visible

Transport & Logistics Keep every aspect of your fleet, Always Visible. With Ctrack’s 35 years experience, we can help you unlock better diagnostics, support compliance reporting, as well as provide tailormade analytics for both short term, and long-term decision making. Ctrack will optimise the right solution for your specific business needs.

Keep your eyes on the road Iris Camera Solution Front-Back-Side Facing Camera Options In Cab Device • Job Dispatch • Navigation • Messaging • Driver Behaviour Display

Asset Monitoring

Temperature Monitoring

Trailer Tracking

Remote Door Unlocking Door Open/Close Sensor

Driver Identification & Driving Behaviour Monitoring Engine Performance Monitoring (CAN)

Fuel Level & Consumption Monitoring Vehicle & Fleet Tracking

www.ctrack.co.za | sales@ctrack.com | Call Centre: +27 (0)860 333 444

Always Visible

Save costs with Ctrack Running fleets of vehicles can be a costly business. With the price of fuel, labour, and consumables rising constantly, the effective management of business assets can significantly affect your bottom line.

a physical speed limiter on the vehicle. If needed, Ctrack SMILE script technology can also adjust a vehicles top speed capabilities based on predetermined Geo zones.

“Despite the fact that Ctrack boasts 35 years of experience in managing vehicles and assets, we are always looking for new solutions that help our customers run their businesses as effectively as possible,” says Hein Jordt, CEO of Ctrack SA.

The Ctrack Driver Centric Mobi application allows driver scores to be logged and data used to improve driving performance. The application also features a fully-fledged vehicle pre-inspection form that is completed and managed digitally through the Ctrack Driver Mobi web app.

Ctrack offers a variety of technologies for positive and accurate driver identification. These technologies include Dallas iButton keys, RF ID cards and in the near future via biometrics, making it easy to determine which driver was driving what vehicle, in what manner and when. A starter lockout can be installed to prevent the vehicle from starting without the correct authorisation via the driver identification system, completely eliminating any risk of unauthorised use.

The driver display unit provides the driver with job-specific information such as job dispatch, navigation and messaging. The functionality of this system in a safe and controlled manner means that drivers are always on the most economical route, which saves time and avoids clocking up unnecessary mileage, resulting in increased productivity.

Video footage from the in-cabin Iris Dashcam can confirm correct driver identification if need be. This windscreen-mounted camera solution includes ADAS and DSM fatigue functionality with a third wired camera for in-cab placement. Connectivity is via 4G, Wi-Fi or Bluetooth. Footage can be viewed via a desktop platform, web-based platform, Android or iOS mobile application or live streaming and includes GPS location and event setup. Driving style and behaviour can also have a significant impact on your business. Drivers who breach road regulations risk their own safety, the safety of others but are also the cause of additional costs for the business such as fuel, maintenance, insurance and even traffic fines if these are not allocated to the individual driver correctly. Ctrack’s driver management tools provide multiple solutions to ensuring that vehicles run effectively, efficiently and safely. These tools also allow for the management of operators, access, and behaviour across multiple vehicles and assets. As an example, Ctrack can monitor speed in a variety of ways, including map speed, a predetermined speed limit on a telemetry device or via

Ctrack’s On the Road solution is high quality, reliable, fleet specific software that can be utilised with any Android-based device. It gives the driver all the tools they need to do their daily job while allowing fleet managers to ensure that their assets are being used most effectively. The On the Road product combines navigation and fleet tools with an operating system that integrates with all the Ctrack software platforms for easy data extraction. Fuel accounts for a large portion of a fleet’s total operating cost, and with the continually increasing fuel costs, the usage thereof needs to be carefully controlled. The Ctrack Fuel Solution gives you eyes in the tank, live monitoring of fuel consumption and levels, and real-time fuel analytics. This reduces fuel loss risk. Ctrack’s rich fleet analytics and smart interpretation of data provide the information needed for critical decision making, from cost savings to future investments. “Saving costs is a natural by-product of Ctrack’s wide variety of tracking and fleet management solutions that allows fleet managers to have eyes on all types of moveable assets through bespoke software solutions and ensures that they are used in the safest, most effective way possible,” concluded Jordt.

www.ctrack.co.za | sales@ctrack.com | Call Centre: +27 (0)860 333 444

Volvo, one of the leaders in developing heavy transport electric vehicles, has plans for both gas-powered and fully electric trucks.

Trucking into a zero-emissions future

n 20 July 2020, the Siberian town of Verkhoyansk inside the Arctic circle recorded a daily temperature of 38°C. That is 18°C higher than the area’s daily average maximum for the period and slightly less than the temperature on the same day in Riyadh, Saudi Arabia. The drums of climate change denialists are much less loud these days as it becomes clear that our planet’s atmosphere is heating up – and fossil fuels are the leading culprit. Many different activities have contributed to that rise in temperature, but the transport sector is one of the largest. Estimates vary, though experts agree that 10-20 per cent of global carbon comes from vehicle exhausts. As such, there is substantial emphasis on replacing internal combustion engine (ICE) vehicles with electric vehicles (EVs). Yet although a lot of the public’s focus rests on cars, buses and trucks also need to go electric. While these modes of transport are more effi cient for the larger loads they carry, on a gross average their emissions are still staggering. According to UK consultancy group Commercial Fleet, a truck travelling just shy

As a growing desire to shift away from fossil fuel use takes hold globally, JAMES FRANCIS asks if trucks and buses are on the road to an electric future of 200 000km a year produces 223 tonnes of CO2 – roughly the same as 14 people in the developed world. And the European Commission found that around a quarter of traffic carbon emissions on EU roads come from heavy commercial vehicles. Trucks and buses scale better, though: for every 160km, a car with one person produces 40kg of carbon per capita, whereas a full bus brings that figure down to 6kg, according to the Center on Globalization, Governance & Competitiveness. Electrifying trucks and buses could enormously affect carbon levels, especially if public transport and improved logistics are a part of the picture.

Trucking to Electric Avenue Commercial electric vehicles (CEVs) define that portion of the market not concerned with passenger vehicles. The sector does not get as much attention as sexier electric sedans and SUVs, and only a handful of incumbent manufacturers work in the space, including Daimler, JAC

“The advantage of fuels like hydrogenated vegetable oil and bio-LNG is that they can reduce fossil emissions today, to a large extent using existing technology and infrastructure.” – Eric Parry 32

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FAST FACT

Mobility accounts for around 20 per cent of global emissions. Source: McKinsey & Company

and Volvo. Several start-ups are also looking to carve an EV niche among commercial vehicles, such as BYD from China and several US-based companies, including Nikola Corporation and Rivian. Yet it can be a volatile space for newcomers, due to nervous investors. For example, Rivian’s share price shot up on the news that Amazon would buy 100 000 of its CEV delivery vans, then dropped when Amazon also announced a deal with Stellantis (formerly Fiat Chrysler.) Even though the Rivian deal still stands, this nonetheless spooked shareholders. Thus we can reasonably expect that the big push for CEVs will come from established brands that transportation companies know. Commentators often point to Volvo Trucks as an emerging leader in the electric truck market – not hard to believe, considering it has unveiled six different heavy commercial electric trucks. But the company takes a broader strategy towards reducing carbon that isn’t limited to CEVs. “Some examples of recent developments are gas-powered and fully electric trucks, and the electro-mobility journey is accelerating with more products and services,” says Eric Parry, senior manager for sustainability at Volvo Trucks South Africa. “Even in a future where the majority of vehicles are electric, we still foresee a need for ICEs, but then running on biofuels. Two promising fuels are hydrogenated vegetable oil Maretha Gerber

2022/03/16 10:36 AM

T RUCK ING

COMMITMENT TO ZERO EMISSIONS

Brands such as Daimler Trucks are focused on increasing the range of heavy transport electric vehicles.

and bio-LNG (a highly sustainable version of liquefied natural gas, also called LBG). The advantage of these fuels is that they can reduce fossil emissions today, to a large extent using existing technology and infrastructure.” Daimler Trucks is another name that regularly pops up in CEV discussions. Several concepts are waiting in the wings, including two heavy transport trucks and an electrified school bus. One, the eM2, is already in limited service. “We are clearly committed to the Paris Climate Accords and we want to have a significant part in shaping the future of CO2neutral transport,” says Maretha Gerber, vice president of sales and marketing for Daimler Trucks & Buses Southern Africa. “Having CO2-neutral transport on the road by 2050 is our ultimate goal. “The electrification road map will start by addressing the short-distance distribution (up to 300km range) application, then move to medium-distance distribution (up to 500km range), and then the long-distance application of 1 000km and above. This has already started and will be rolled out in the next five-to-10 years.” Extending range is an important goal for the industry. Currently, Daimler’s eCascadia truck claims a range of around 400km on a gross weight of 27 tonnes. The Volvo FH Electric’s specs claim a gross combination weight of up to 44 tonnes and a range of 300km. Though the record for the longest electric truck distance without a recharge is over 1 000km (set by Futuricum), 300-400km is currently the

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FAST FACT

DID YOU KNOW?

Road transport is responsible for 91.2 per cent of South Africa’s overall transport emissions. Source: Department of Transport

general benchmark. Such numbers indicate that CEVs have a larger hill to climb than their passenger contemporaries.

Inner-city travel While the aforementioned numbers aren’t exactly great for long-haul applications (unless you add a few recharge stops along the way), the case is much stronger for urban uses. Chinese manufacturer JAC is one of the groups focusing on lighter CEVs, with models of up to 12 tonnes. JAC claims its N55 EV truck can cover 300km with a 2.5-tonne load, and sees the efficiencies of running a CEV fleet as a big selling point. “Transport operators in the logistics industry are constantly under pressure to find the cheapest route to a destination,” says Karl-Heinz Göbel, CEO of JAC Motors South Africa. “Therefore, electric fleets make much more sense than the traditional ICE approach. Reliable data on the grassroots level is being gathered to showcase the tremendous benefits and cost savings when logistics companies migrate to CEV fleets and renewable energy resources, for example solar panels at warehouses and distribution centres, the optimisation of charging stations and so forth.”

More than 100 signatories support the COP26 Declaration on Zero-Emission Cars and Vans to transition to zero-emission vehicles by 2040, including 11 major vehicle manufacturers. Source: World Economic Forum

The list of countries and companies that agree to zero-emission milestones is growing steadily, and 15 countries agreed at COP26 that, by 2040, 100 per cent of their truck and bus sales should be zero-emission vehicles. But there is still a long road to travel. According to data from the Drive Electric campaign, commitments to zero emissions cover 23 per cent of global transport demands, of which: • 19% are cars • 27% are trucks • 35% are buses

JAC is also looking at the public transportation market and is importing a panel van to test its viability for local taxi services. These trials will ultimately decide the future of CEVs in the country, Göbel notes. “Valuable operational data will be collected to plan for the future roll-out of our range of EV products in the country.” The same goes for local buses. Last year, BYD imported two EV buses in a joint trial with Golden Arrow Bus Services (GABS). Their performance will inform the possibility of more such vehicles, wrote GABS company engineer Gideon Neethling in a statement: “For the first few months, we tested the buses in a range of circumstances without passengers. The aim was to get to know exactly how these vehicles perform before incorporating them into our operations. Testing these vehicles has been a joy for everyone who is part of the project. Each time we carry out a new test or reach a new milestone, the level of excitement increases further.” Excitement may be great, but commercial acceleration is essential. Deadlines to phase out ICE transport are at most 17 years away, and cities such as Moscow have already stopped buying diesel-powered buses. Several companies, such as Volvo, are proponents of hybrid commercial choices such as trucks using LNG. Hybrids might be the nearterm solution to the short timelines and the transport market’s performance requirements, until fully electric trucks can carry the load. If local policy reflects an earnest intention to switch to cleaner emissions, it would help a lot, says Gerber. “The first step is to make clean fuel mandatory, then move vehicle emission standards to Euro 5 or Euro 6 as a country as soon as possible. This will show the rest of the world that we are also serious about protecting the environment. It would be difficult to talk about CO2 reduction and saving the planet if your own backyard were not in order.”

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THE IVECO DAILY RANGE: SAVING YOU MORE WITH EVERY KILOMETRE

The IVECO Daily is the vehicle of choice in the express delivery sector thanks to its revolutionary cost-saving technologies which lower the total cost of ownership while boosting the productivity and profitability of your business. The express delivery market in South Africa is growing rapidly and to get ahead in this highly competitive industry, businesses must cut costs. This is where the IVECO Daily range comes in: with its fuel-saving technologies, longer service intervals, and an increased carrying capacity, businesses are getting more savings with every kilometre. With fuel being one of the biggest expenses for operators, the IVECO Daily proved its fuel efficiency on a 1,084km round trip between Johannesburg and Durban in a recent test conducted by Focus On Transport And Logistics magazine and TruckScience. The 16 cubic metre IVECO Daily 50C15V panel van, carrying a payload of 2.8 tons, achieved a fuel consumption of 8.61 km/l, while the 70C15 chassis cab with a 25 cubic metre van body and a payload of 3.2 tons achieved 6.57 km/l! With such incredible fuel efficiency, it’s no wonder many companies have added the advanced IVECO Daily to their fleets. Micky Caisutti of Randburg Commercial Vehicles (RCV) and Mikhail Johnson, National Linehaul Fleet Manager at NGL Logistics – a long-standing IVECO Daily proponent – have both praised the 30,000km service intervals of the IVECO Daily vehicles. Mikhail added that NGL’s vehicles do roughly 30,000km per month and these long service intervals ensure minimum downtime for their Dailys, increasing

asset availability and making planning easier, thus improving asset utilisation. Built with a 3L diesel engine, the IVECO Daily’s durability and power is unmatched. Several of NGL’s IVECO Dailys have done over one million kilometres mileage and, with just general maintenance and services, are still going strong. Micky Caisutti (RCV) has also likened the Daily to driving a bakkie with the power of a truck, stating that it’s perfect for those time-sensitive industries, such as express delivery. The IVECO Daily range also offers ﬂeet owners/operators vehicles from 3.5 tons to 7.2 tons with a chassis which can be further customised to meet their business’s speciﬁc requirements. The IVECO Daily also has a 3.5ton towing capacity which is the best-in-class towing capacity!

Micky Caisutti

Along with its incredible power, the IVECO Daily range offers drivers a comfortable space which is ideal for the long road. With steering wheel controls and easy access to their mobile phones, drivers can fully focus on the road, minimising distractions for safer trips. With cruise control, fuel efficiency, comfort and reliability, and a stylish look, many drivers have claimed that driving the IVECO Daily is similar to driving their own cars. The IVECO Daily range is built to help improve a business’s productivity and profitability. The further your fleet drives, the more you will save with the IVECO Daily range. The savings for high mileage fleets are game-changing and can finance rapid expansion in a competitive segment of the road transport industry. The IVECO Daily is your total transport solution that will sustain your business on the road to success!

Mikhail Johnson

HOW MUCH WOULD 8.61KM/L IMPROVE YOUR EXPRESS DELIVERY BUSINESS?

Focus On Transpor t And Logistics magazine and TruckScience recently tested the IVECO Daily 50C15V 16 cube metre panel van with a payload of 2.5 tons and the 70C15 chassis cab with a payload of 3.2 tons on a 1,084km round trip between Johannesburg and Durban and achieved fuel economy of 8.61km/l and 6.57km/l respectively. Scan the QR code to check out video footage of the test drive. If you can save on your fuel bill, why wait?

Contact your nearest dealer for a quote or call our National Sales Line on 011 243 6065 and let us help you find the right Daily for your unique business needs. www.iveco.co.za

A DV ER T ORI A L CRO S SROA D S

SAFETY IS A BUSINESS IMPERATIVE For logistics operator Crossroads, safety is an integral core value, ingrained in the company ethos and integrated into everything they practise

COMPANY CULTURE Everyone in Crossroads lives this safe culture. “Everyone has the right to return to their families, healthy and alive, after work each day. That is why we strive for zero incidents,“ says du Preez. “We are all responsible for safety – it is not something for which the SHEQ department is solely responsible. Management ‘walks the talk’ with visible safety leadership,” continues du Preez. “We all focus on the task at hand. No one takes shortcuts. We are all responsible for each other. No work is so urgent or important that we cannot do it safely.”

TECHNOLOGY IMPLEMENTATION Crossroads has introduced several new technologies to improve safety within operations, including geotagging technology that allows for real-time information to be accessed from vehicles out on the road. “We have developed solutions where we can push information to our drivers only at specific locations and times where they can access it safely. That way, there are no distractions while they are driving,” says du Preez. “Safety is always top of mind in our business, and we are proud of our safety compliance record. Our ongoing driver training includes keeping our teams up to date with the risks associated with long-distance driving. Our drivers spend many hours on the road, and we equip them with the knowledge, skills and tools they need to stay safe. Safety compliance goes a long way towards reducing risks.” Drivecams have been installed across the fleet. These in-cab devices continuously

analyse driving behaviours as well as events inside, outside and around the vehicle to keep drivers and vehicles safe. This technology allows Crossroads to closely manage the behaviour of drivers, while continuously mitigating on-road risk. “Embedded sensors capture information regarding risk events such as harsh braking, sudden acceleration, swerving, excessive speed and other unsafe actions that could lead to collisions.” The technology is further used to monitor the road in front of the vehicle, giving alerts when there is an unintentional deviation from a driving lane, ensuring safe following driving distances are kept and even recognising certain traffic signs and speed limit signs and alerting drivers. Another tool is the breathalyser, also installed in the vehicle’s cab. It protects against the vehicle being started and driven by an individual whose blood/alcohol content is higher than a predetermined level. “This device analyses a breath sample and provides an accurate alcohol reading, ensuring that no vehicle in our fleet is ever operated by a driver under the influence of alcohol,” says du Preez. The company also employs technology to recognise fatigue – even before a driver closes his eyes. This is done by monitoring a driver’s retinas and face using a Percentage of Eye Closure system. “A high-pitched alarm followed by voice alerts is used to make drivers aware of their fatigue levels or even distractions that might occur while on the road.” Other implementations to enhance safety include reflective branding decals on vehicles that enhance the reflective impact of vehicles at night, while water spray suppressor mud flaps on the trucks and trailers assist in wet weather conditions. “These devices prevent spray from moving to the side of the vehicle or into other lanes, ensuring that vehicles passing the truck always have clear views in wet conditions.”

EFFECTING CHANGE Along with the use of technology, the company has adopted 13 life-saving rules for its employees that include no use of mobile devices while driving. “Our policy is simple: engine on, cellphone off,” says du Preez. Other rules include wearing a safety belt at all times, not driving under the influence of alcohol or drugs or when tired, wearing the correct and required personal protective equipment for the job, ensuring the safe loading and offloading of vehicles, always driving with headlights on, and obeying all traffic laws at all times. This strong approach to safety has led to Crossroads’ accident ratio decreasing across all operations. “Safety at Crossroads is an ongoing journey,” says du Preez. “We are evolving all the time. Safety training as part of our internal values on which all staff are trained happens continuously.”

➔ Scan this QR code to go directly to the Crossroads website.

For more information: businessdevelopment@crossroads.africa www.crossroads.africa

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rossroads CEO Arend du Preez says that there is zero compromise on safety standards in the company – an approach that has contributed hugely to the success of the company that was established more than 80 years ago in the Northern Cape.

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L OGIS T IC S, F REIGH T A ND WA REHOUSING

A supply chain

boosted by digital technology FAST FACT

4IR technology is only useful in the supply chain if implemented and utilised effectively. TREVOR CRIGHTON investigates why

1. Only 22 per cent of companies have a proactive supply chain network. 2. Around 43 per cent of small businesses don’t track their inventory. 3. Some 67.4 per cent of supply chain managers use Excel spreadsheets as a management tool. 4. On average, US retail operations have a supply chain accuracy of only 63 per cent. 5. Due to the COVID-19 pandemic, the estimated value for out-of-stock items in 2020 was R17.4-trillion. Source: Zippia

Automated conveyor systems speed up stock movement in the modern warehouse.

he focus of the modern supply chain is on the management of data, services and products, which are bundled into solutions. Whereas historical supply chain management revolved around “where and when”, 21st-century supply chains rely on product and service quality, delivery, costs, customer experience and profitability. According to IBM, a typical supply chain system accessed 50 times more data in 2017 than just five years earlier – and that number has inevitably skyrocketed over the course of the last two pandemic-affected years. Modern supply chains need to take advantage of massive amounts of data generated by its processes. This must be analysed properly, in real time, with a focus on optimisation at each step.

Pandemic acceleration Neptek MD Richard Nepgen says that the deployment and adoption of technology in the supply chain has been phenomenal over the last two years. “Challenges in shipping, reducing handling and touching of items and paperwork, long lead times to get stock from manufacturers, and e-commerce growth have accelerated this exponentially.” Crossroads Distribution CEO Arend du Preez says that for companies that already had an eye on the future, the pandemic has accelerated the adoption of technology by about a year. “We had been focusing on harnessing the power of technology in our supply chain for a while, but sped up things like the electronic processing of documentation from our customers, which we’re now able to integrate into our system in any format.” The acceleration of technology wasn’t only in the supply chain steps themselves, but also in terms of how companies adapted to operating under lockdown and riot conditions.

According to IBM, a typical supply chain system accessed 50 times more data in 2017 than just five years earlier – and that number has inevitably skyrocketed over the course of the last two pandemic-affected years.

Crossroads Distribution uses geotagging to ensure that some of the in-cab tech is only available once the driver arrives at their destination, to minimise distractions.

Leaders and laggers South Africa has a reputation for being advanced in certain technological spaces and lagging in others. Crossroads Distribution IT manager Warren Charles feels local logistics is a case of the former. “We use a lot of advanced technology, which positions us as leaders in certain aspects, while some local companies are leaders in their sectors. That said, there are a lot of companies not using modern technology at all – the split between the two sides is quite dramatic.” ZacPak MD Willie Nel says that areas like access control have been boosted over the last five years, leading to the gathering of a lot more information from a fairly simple technological change. “There’s been a lot more focus on prearranged visiting times to avoid congestion. That’s led to us gathering more information in terms of our clients’ trucks and drivers, when we scan licences as part of the process. ›

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L OGIS T IC S, F REIGH T A ND WA REHOUSING AI IN THE SUPPLY CHAIN

“Security and risk control were the goals, but the ancillary benefit has been that we’ve actually been able to track which trucks and drivers have valid licences, as well as understand what that means if the truck gets into an accident.” Nepgen says the South African freight, logistics and warehousing industry is advanced in terms of the use of handheld devices, enterprise resource planning (ERP) systems, and transportation and warehouse management, but some companies are definitely evolving faster than others. “Those who are lagging will need to shift in order to stay competitive and maintain service delivery levels,” Nepgen says. “In the parcel express and distribution space, we are seeing clients moving more to in-line automated scanning, weighing and volumising, as well as automated parcel sortation systems. Automated picking, using robotics and automated storage and retrieval systems, hasn’t taken off yet, but I believe this will be the next phase.” Charles says Crossroads Distribution’s focus is on driver safety, leading them to deploy things like real-time geotagging, which governs the availability of the technology in the vehicles. “The more manual interventions we can remove, the more time and energy can be spent on managing the well-being of drivers. Some of

the technology in the vehicles doesn’t switch on until the driver is close to or at the location, so it doesn’t distract them.”

Technology hurdles Connectivity and network stability come up time and again in discussions around what’s holding back the adoption of technology in the local supply chain industry. “Connectivity in South Africa is still prohibitive in terms of cost, so much of the country isn’t covered by the major mobile providers – never mind the challenges and huge expense of connectivity when it comes to cross-border transport,” says Du Preez. “5G coverage is growing, but only really in the metro areas. We want to get to the point of having the ‘connected cab’, but can’t because of unreliable and expensive network access. This is key to giving our drivers all the necessary tools to be safe and manage our business more efficiently.” Du Preez says that, given better connectivity, Crossroads Distribution could deploy tools like artificial intelligence (AI) cameras in-cab, which could help manage distraction and driver fatigue. “These technologies bring safety to the fore, helping to cut down on road incidents for drivers and other road users. Having a communications centre in the cab could help

MODERN SUPPLY CHAINS In a paper titled The Path to a Thinking Supply Chain, Simon Ellis, program vice president for supply chain strategies at International Data Corporation, defined modern supply chain management in terms of “the five Cs”: • Connected: Being able to access unstructured data from social media, structured data from Internet of Things devices, and more traditional data sets available through traditional ERP and B2B integration tools. • Collaborative: Improving collaboration with suppliers increasingly means the use of cloud-based commerce networks to enable multi-enterprise collaboration and engagement. • Cyber-aware: The supply chain must harden its systems and protect them from cyber-intrusions and hacks, which should be an enterprise-wide concern. • Cognitively enabled: The AI platform becomes the modern supply chain’s control tower by collating, coordinating and conducting decisions and actions across the chain. Most of the supply chain is automated and self-learning. • Comprehensive: Analytics capabilities must be scaled with data in real time. Insights will be comprehensive and fast. Latency is unacceptable in the supply chain of the future.

Source: https://hosteddocs.ittoolbox.com/path-thinking-supply-chain.pdf

Source: IBM

us warn drivers of hazards and inclement weather on the route, and even suggest redirection to maximise safety and efficiency.”

Embracing a tech-led future Nel believes that blockchain technology is going to change the market eventually, but for the moment, even shifting away from email communication to alerts for milestones would allow the industry to take a quantum leap in efficiency. In terms of Fourth Industrial Revolution technologies like AI, he says that these play a role in the throughput environment of freight forwarding, but have much more weight upstream in the supply chain. “Developing algorithms to tell drivers where to place FMCG stock most efficiently in terms of shifting it quickly works, but in freight forwarding, the best place for AI is in load planning and ship chandlering.” Nepgen says that supply chain participants need to look at their operations across the board, identify inefficiencies, and understand how they can improve or remove them to lower operation costs and drive productivity. “The best way to remove inefficiencies is to remove mundane tasks and multiple handling, improve ergonomics and keep the solution simple. In South Africa, whatever solution one comes up with needs to be simple, easy to operate, reliable and efficient. It also needs to be foolproof and robust. The technology should furthermore be locally supported with quick response time where possible.”

IMAGES: ISUPPLIED

Placement and picking are sped up by AI planning in warehousing

The goal for the future supply chain is to connect all its elements digitally using AI, to enable companies to do more with data, make better real-time decisions and take more informed actions, faster. AI innovations in supply chain management allow players to: • Identify, assess and address potential disruptions before they occur • Mitigate the impact of unpreventable disruption • Seize upside demand opportunity before competitors • Simulate process optimisation scenarios for better business and customer outcomes • Track inventory for instant visibility into the progress of goods at any point • Provide instant shipment quoting capabilities that reflect actual market rates • Determine shipment damage and when it occurred to recommend the best corrective action

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DESIGN YOUR FUTURE BUILD YOUR CAREER IN THE LOGISTICS & SUPPLY CHAIN INDUSTRY

REGISTER NOW: Higher Certificate in Supply Chain Management Bachelor of Commerce in Supply Chain Management Postgraduate Diploma in Supply Chain Management

2022 REGISTRATION NOW OPEN

Online lectures, webinars, and tutorials for best practice in distance education. DURBAN Learning Centre:

regent.ac.za |

study@regent.ac.za |

031 304 4626

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Accredited by the Council on Higher Education (CHE) and registered with the Department of Higher Education and Training (DHET). Registration Number 2000/HE07/012.

A DV ER T ORI A L CH A R T ERED INS T I T U T E OF T R A NSP OR T A ND L OGIS T IC S

PROFESSIONAL SUPPORT FOR PEOPLE IN LOGISTICS AND TRANSPORT Founded in 1919 with a mission to improve industry practices and nurture talent, the Chartered Institute of Logistics and Transport is the leading organisation for everyone who works in logistics, transport and supply chain.

he Chartered Institute of Logistics and Transport (CILT) comprises 35 000 members in 35 countries. We are committed to giving individuals and organisations access to the tools, knowledge and connections vital to succeed in logistics, transport and supply chain management. Through our educational suite of programmes and our commitment to high standards, we help professionals at all levels to grow, develop their careers and access better jobs.

choices and an understanding of what is required to be relevant and successful.

OUR INTEREST GROUPS

Next Generation is a CILT programme, a forum comprising young professionals within the transport, logistics and supply chain industries. If you are a CILTSA member under the age of 35, you automatically belong to the Next Generation Group. The Next Generation programme was created to allow young people who work or study in these OUR MEMBERS industries to network Our members come and develop their from all sectors professional careers. of the profession Join CILTSA’s YP including logistics, Next Generation today transport, supply chain and be a #Game operations, policy and Sandile Khoza CMILT - Champion: Changer in your field. infrastructure. They CILTSA Next Generation Stay abreast of the are all connected in latest news, insights that they are involved and events within and around the transport, in either the movement of goods or the logistics and supply chain industries. Bring your movement of people. ideas and innovative solutions for transforming We provide a pathway for development our industry and take the Institute to the next within these key areas via the CILT level. Join us today and change your life, Competency Framework. Having clear career enhance your career and transform the industry. pathways and roadmaps results in positive

The value proposition of CILT Next Generation is to: • ensure that students currently studying logistics and transport are connected to the private sector for further practical training • create an environment that is meaningful and supportive for young professionals within the industry • produce academically researched papers and journals for the logistics and transport industry that can be discussed on different platforms • create a pool of researchers within the logistics, transport and supply chain industries who work alongside the private sector to address industry challenges. With the signing of the Africa Continental Free Trade Agreement, CILTSA Next Generation SA is working with CILT Next Generation groups from other African countries. This team is creating an information portal for access by both the private and public sectors. #If it is to be, it’s up to you.

BENEFITS OF CILTSA MEMBERSHIP • Professional designations – get the local and international recognition you deserve: MILT/CMILT/FCILT • Connection • Professional voice • Professional recognition • News and publications • Personal development

WOMEN IN LOGISTICS AND TRANSPORT (WiLAT)

iLATSA is a CILTSA interest group designed to support women in the logistics, transport and supply chain industries. It is part of the wider CILT International network with branches in 14 countries and over 1 600 members worldwide. Its vision is to be the most sought-after group for advocacy, professionalism and empowerment of women.

In the transport, logistics and supply chain industry. WiLAT exists to: • promote the status of women in the logistics, transport and supply chain industries • bring together those who support the talent and career development of women • provide a support network and mentoring opportunities for women working in the industry. Margaret Bango CMILT founder of WiLATSA

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CH A R T ERED INS T I T U T E OF T R A NSP OR T A ND L OGIS T IC S A DV ER T ORI A L

CILTSA CANDIDACY PROGRAMME CILTSA’S fully funded professional training programme for women opens international opportunities

he Chartered Institute of Logistics and Transport South Africa (CILTSA) was the first organisation to receive funding from the Transport Education and Training Authority (TETA) to host the Institute’s inaugural Candidacy Programme in 2017. Through this initiative, 30 women in the transport and logistics industries were officially enrolled for training towards the International Certificate in Logistics and Transport (CILT) Elvin Harris qualification. They also became student members of CILTSA. After completing their qualification, the women were also awarded a professional, internationally recognised designation – MILT. “We know there is a huge skills gap in transport and logistics – it is still very much a male-dominated industry,” says CILTSA president Elvin Harris CMILT. “We need more women professionals. The CILTSA Candidacy Programme is the start of something really good and

CILTSA and WiLATSA Commercial Transport Academy Graduates.

long-term. The responsibility is on all of us to make it work. “The beauty of this CILT qualifi cation is that it is international,” he continues. “The institute has a presence in over 35 countries, which means that the candidates achieve both a qualifi cation

and a designation that is portable across the globe. The programme is both theoretical and practical, essential in today’s world.” CILTSA hosted the second cohort of women on the programme in 2018, which saw 14 ladies complete the programme.

DEVELOPING WOMEN IN TRANSPORT CILTSA and WiLATSA support the Commercial Transport Academy. The CTA is championing the Women Inspiring Women to Lead in Transport Programme, which offers a CILT qualification. This USAID-supported programme will train 120 female professionals, 300 women entrepreneurs and 495 female truck drivers.

SOME OF OUR CILT ACCREDITED TRAINING PROVIDERS

Harley Reed: Sonia Weston 011 312-8411 soniaweston@harleyreed.com www.harleyreed.com

IMAGES: SUPPLIED

BIZZCO: Ansonet van Deventer (0) 10 001 0283 ansonet@bizzco.co.za www.bizzco.co.za Commerce Edge: Clintin Chetty 086133-4326 clintin@commerce-edge.com www.commerce-edge.com

IMM Graduate School: Christa Kavungo 011 628-2000 Christa Kavungo christak@immgsm.ac.za Institute for Quality 011 472 0981 www.iqetd.co.za

➔ Scan this QR code to go directly to the Charted Institute of Transport and Logistics website.

For more information: 087 822 2858 info@ciltsa.org.za www.ciltsa.org.za

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CHEMICA L S

The chemical sector contributes R85.9 trillion annually to global GDP, supporting 1.9 million jobs.

The chemicals between us

umans have used chemicals to enhance our surroundings and productivity for thousands of years, from prehistoric artists blending pigments for cave paintings, to mixing alloys for bronze, to collecting urine in London for dye-making, seen by some as the earliest example of the Industrial Revolution. The modern world is a chemical world, and the resilience of chemical supply chains directly impacts its progress and well-being. As with many other industries, this one has come into sharp focus during the pandemic. “As the global economy recovers, the pandemic is increasingly perceived as being a facilitator for resilient and robust supply chains,” wrote Marc Münch, director at PricewaterhouseCoopers, in a 2020 report. “More than any other stress test, COVID-19 has exposed the vulnerabilities and weaknesses in today’s chemical supply chains.” Vulnerabilities occurred along the entire chemical value chain, according to PwC. Plant shutdowns and bankruptcies rattled tier two suppliers, which produce raw chemical ingredients. Tier one producers further downstream ran into supply problems caused by inadequate supply chain visibility and planning. Consequently, producers and distributors experienced fragile networks and limited flexibility due to unstable and unreliable demand. The impact of these disruptions is very real. Oxford Economics values the chemical sector’s contribution to global GDP at R85.9trillion, supporting 1.9 million jobs. In South Africa, the sector contributes 5 per cent of GDP and represents around 20 per cent of manufacturing, according to the Industrial Development Corporation of South Africa. Thus, modernising the chemical supply chain has genuine consequences for growth and prosperity, not to mention environmentalism and sustainability.

Modernising chemicals What do we mean by modernising chemicals? An Accenture report articulates it as such: “The supply chain of the future in the chemical industry will be self-driving, self-manoeuvring and self-correcting, resulting in a seamless fulfilment capability that delivers chemicals at the right time, to the right place and with the right quality – without manual human interaction.” Some local chemical manufacturers were sensitive to these trends even before the pandemic. Jacques de Villiers, general manager of supply chain at Omnia Group, notes that focusing on localising supply to service customers helped to reduce carbon footprint and waste, and eliminated duplication of effort. Yet problems predating the pandemic have urged South Africa’s chemical sector into further action. Challenges such as load shedding and rail freighting conditions have made it clear that established chemical value chains aren’t as reliable as they may seem. The past two years have added even more pressure, bringing home the point that supply chains need to be adaptable and flexible. “The challenges and constraints we faced over the past two years have changed the way we think about previously ‘fixed’ solutions to a broader, more holistic view of our footprint,” says De Villiers. “We believe in leveraging capabilities and knowledge across the Omnia Group and our network of supply chains. This requires developing people through cross-functional collaboration and leading practice capability. Continuous improvement and agility are important for resilient supply chain practices.”

FAST FACT

As much as the pandemic was a shock to chemical supply chains, its impact does not look set to last. For example, industrial chemical production in the US contracted by 7.2 per cent in 2020 yet rebounded again by 5.5 per cent in 2021, with a further 4 per cent anticipated in 2022. Source: American Chemistry Council

A new centre Concepts such as agility and continuous improvement don’t function well if supply chain strategies focus solely on product and procurement. Guidance for the sector increasingly calls for customer-centricity, a concept that uses customer behaviour and demand as the primary feedback points for building strategy. But customer-centricity isn’t about pandering to every client. Rather, it’s a culture that leverages analytics and other data-driven technologies to enhance predictive customerdemand forecasting, inventory optimisation, and integrated and effective supply planning through data and systems intelligence. It works very well, De Villiers concludes: “The foresight that this provides enables us to respond quickly to changing environments and ensure that alternative options to critical supply are available.” The future of effective, efficient and digitised chemical supply chains won’t primarily arrive out of necessity, but through vision. The manufacturers that pursue their modernisation vision will become the sector’s leaders.

“The challenges and constraints we faced over the past two years have changed the way we think about previously ‘fixed’ solutions to a broader, more holistic view of our footprint.” – Jacques de Villiers

IMAGE: UNSPLASH/LOUIS REED

Chemical supply chains are becoming more automated and customer-centric, writes JAMES FRANCIS

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T HOUGH T L E A DERSHIP

reating an online store sounds easy. Essentially, you subscribe to the e-commerce provider of your choice, then provide the images, prices, marketing budget and your banking details – and watch the money roll in. As with anything, however, it is not as easy as it sounds. Anyone who has tried this and reached scale knows all too well that the logistics leading up to the last-mile delivery will place your business under significant strain, unless you’re an industrial engineer or similar with both deep pockets and a passion for logistics and technology. The keys to successful e-commerce fulfilment are speed and a high degree of accuracy. This is within an environment of erratic demand and a high variety of low-volume stock keeping units. This combination of factors, among others, makes planning and Greg Fine resourcing difficult, and increases the risk of error. Errors can drive up costs and potentially damage your organisation’s reputation.

IMAGES: ISTOCKPHOTO.COM, SUPPLIED

Hybrid, agile and scalable Constantly changing demand necessitates the need for a hybrid workforce, with both a fixed and flexible component of labour. The fixed component needs to be supplemented with additional labour within a relatively short space of time, to cater for spikes in demand associated with cyclical and/or random demand events. The implication of this constantly changing demand and hybrid workforce is the need for a robust and user-friendly system – one that scales its transaction requirements and promotes rapid user training with high accuracy and speed. Simple, robust systems are in fact highly complex.

When outsourcing makes business sense GREG FINE, MD of ParcelNinja, outlines the complexities of DIY e-commerce delivery

Packaging materials Not only does a business need to worry about managing its product availability in real time, but it also needs to guard against packaging material stock-outs. Packaging material stock comprises several box sizes, void fill, thermal waybills, tape and various cushioning materials. Running out of any of these would result in delays, which could be followed by reputational damage. To prevent this, businesses tend to overstock, which then compromises their ability to expand product range and availability. Moreover, they may be tempted to reduce the variety of box sizes to free up space and cash. However, doing so drives up shipping costs and materials usage. Supplier-imposed minimum order quantities can further complicate these decisions. These trade-offs impact efficiency and effectiveness.

Managing the last mile Imagine that it is Monday, month-end and post-Easter weekend. All orders have been successfully packed, and the shipping volume and materials have been optimised. No packaging material or product stock-outs were noted, and only marginal extra labour was used with no overtime. It’s now 6pm, the warehouse staff have left, leaving it up to the business owner to complete the task of ensuring all parcels are labelled, with accurate weight and dimensions noted, and – together with customer delivery addresses and contact details – are submitted to the couriers. Ideally, at least two couriers should be used, to ensure delivery costs are optimised

Not only does a business need to worry about managing its product availability in real time, but it also needs to guard against packaging material stock-outs.

and risk is mitigated against system outages, line haul accidents, and other unexpected events that can disrupt or take down preferred couriers. Now that the parcels have left the facility, it’s track-and-trace time – a full-time job at scale, even with a 98 per cent reported courier on-time delivery statistic.

Costs, systems, infrastructure and compliance Businesses need to ensure they are getting the best prices for packaging material and that couriers are charging what was quoted. They need the correct skills, hardware and systems. They also need to have the right infrastructure, technology and processes to promote high storage, along with picking and packaging accuracy at speed – while also optimising for space utilisation and labour productivity. Further, compliance with legislation relating to occupational health and safety, labour relations, fire and more can be complex, onerous and costly. However, ignoring this may result in a declined insurance claim, or labour challenges that could escalate beyond internal capabilities.

So what is the answer? In the absence of scale, small businesses are free to – and should continue to – operate their e-commerce stores out of their homes or offices. If one has reached scale, the focus should be on product assortment, sourcing, advertising and customer excellence. Outsource the heavy lifting and significant costs associated with e-commerce logistics, and let the experts deal with all of this. After all, they have the scale, infrastructure, systems and skills to optimise for both costs and, most importantly, for customer service and experience.

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A DV ER T ORI A L OMNI A

Omnia’s fleet of locomotives reduces logistics risk.

OMNIA LEVERAGES INTEGRATED SUPPLY CHAIN MANAGEMENT ACROSS AGRICULTURE AND MINING Integrated supply chain management across agriculture and mining requires agility for business resilience

CREATING A RESILIENT SUPPLY CHAIN

he global pandemic and other local supply complexities have further strengthened Omnia’s focus on enhanced agility in supply to maintain a robust supply chain strategy, especially in the context of global uncertainty. These dynamics prompted Omnia to form its strategic sourcing and supply chain capability to minimise negative impacts on supply. This required working closely with customers to understand their demand cycles, strengthening supplier relationships and optimising inventory management. “It was critically important to build resilience and agility in our supply chain to service our customers in an increasingly unpredictable market. We started by driving greater alignment between our

manufacturing and customer-facing business units of agriculture and mining, encouraged close collaboration across teams, and based our decisions on robust data as well as insights,” says Jacques de Villiers, head of supply chain management at Omnia Group. Omnia’s emphasis is thus on ensuring it remains a reliable supplier to its customers and playing its part in driving its purpose of protecting life, sustaining livelihoods and creating a better world. For the agriculture division, a reliable supply of fertilizer enables farmers to produce adequate food for a growing population, and the mining division’s agility to supply minerals into various markets has a profound impact on employment and protects livelihoods. “Being a reliable supplier requires an agile mindset, and we are focusing on developing

our team’s agility to thrive in an ever-changing environment. Being people-centric also requires building close relationships with our customers, shareholders, suppliers, communities, and other stakeholders,” de Villiers adds. For Omnia, the key to optimising supply chain resilience was to diversify its global and local sourcing capabilities. “We have also comprehensively assessed our logistical agility and resilience within this context. We diversified our road and rail logistics to counter some of the port delays faced since the pandemic and carefully assessed our geographic presence following bottlenecks caused by the social unrest last year,” he concludes.

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OMNI A A DV ER T ORI A L

OMNIA’S ESG AGENDA

IMAGES: SUPPLIED

mnia’s sustainability agenda is deeply integrated into its business’ strategy. The business has adopted a holistic approach to safety; environmental, social and governance (ESG); and precision technology. By developing local suppliers through Omnia’s supplier selection processes, setting prerequisites for recycled materials, and through stringent quality standards, the business has reduced its carbon footprint while aligning with its sustainability and environmental agenda. “We are building resilience with a substantial investment in a renewable energy plant at our Sasolburg factory, which will, ultimately, reduce our reliance on the electricity grid,” says Francois Visagie, Omnia’s head of manufacturing. “Equally, the effectiveness of our supply chain practices has directly contributed to the reduction of our carbon footprint. In the past year, Omnia switched from single-use plastic liners to recycled plastic. We also diversifi ed our transport utilisation to include rail transport into the SADC region.” BME, Omnia’s mining division, promotes recycled inputs by applying used oil in its blasting emulsions, thereby sustaining livelihoods through local enterprise development and contributing directly to the ESG agenda. The business recycles 25 million litres of used customer oil annually, which significantly reduces the potential for environmental harm as one litre of used oil can contaminate one million litres of water. Visagie adds: “We emphasise social development through strategic sourcing and supplier development initiatives. By remaining close to our supplier base and their supply chains, we can meet our environmental and social commitments. We maintain strict compliance and governance to ensure procurement best practices. These practices de-risk the business, increase local sourcing, reduce our environmental footprint – as well as that of our customers – and promote supplier enterprise development.” Through continuous improvement and alignment with governance and compliance teams, Omnia continues to proactively enhance its ways of working.

BME’s used-oil truck collects used oil from customers.

A CAREER IN SUPPLY CHAIN MANAGEMENT Jacques de Villiers, head: supply chain management, Omnia Group, talks about the skills needed for a career in supply chain and offers some advice to those considering entering the field Would you recommend supply chain management as a career option? Supply chain management offers diversity, as you need to interact with every part of the business. This ensures touchpoints with different people and thought processes, and presents both new challenges and opportunities every day. I find driving change, building business resilience and agility, and just making things happen deeply satisfying. What skills are needed to manage supply chain in a business? Supply chain management straddles all the elements of an organisation, from finance, procurement, production, marketing and sales, to technology and digital. You need a broad skill set to see the bigger picture and

connect the dots across business silos. You need to develop leadership skills as a lot of change management is required. You need a vision and a clear path of how to achieve that vision, and also be able to motivate teams to drive such beneficial change. What advice would you give someone entering the supply chain job market? This adage rings true: get a job to learn, not to earn. It is important to get exposure to the various facets of supply as early as possible and build your experience across various aspects of the business. This will not only help you to progress your career, but also provide opportunities for you to gain knowledge and experience that augment your ability to be a trusted specialist.

ABOUT OMNIA Established nearly 70 years ago, Omnia is based in South Africa and listed on the Johannesburg Stock Exchange. Operating across 25 countries, Omnia is expanding its presence across SADC, North America, Canada, Brazil and Australasia. Internationally recognised for innovative research and development, Omnia differentiates itself based on its leading supply chain and manufacturing capabilities, as well as its specialised customer solutions that are accessible to clients in the agriculture, mining, water, consumer care, food and pharmaceutical, coatings and manufacturing sectors.

➔ Scan this QR code to go directly to the Omnia website.

For more information: info@omnia.co.za www.omnia.co.za

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THE SOUTH AFRICAN ASSOCIATION OF FREIGHT FORWARDERS Established in 1921, The South African Association of Freight Forwarders (SAAFF) is a national association with members throughout the Republic of South Africa. Freight Forwarding plays an essential role in international trade and our members are dedicated to facilitating this activity through their involvement in international supply chain.

SAAFF’s Vision

Strategic Aim for 2022

Our vision is to be the APEX body for Logistics, Freight Forwarding, and Supply Chain management, not just in South Africa but in Sub-Saharan Africa as well. We aim to bring exceptional value to our members and the industry by actively engaging in research and development initiatives, fulfilling a significant advocacy role, and providing capacity-building opportunities.

SAAFF aims to play a decisive advocacy role and help to identify non-tariff barriers, also providing scalable solutions. Moreover, SAAFF aims to pinpoint and address areas where there is a lack of cooperation and coordination among industry bodies and public and private sector stakeholders by fostering trust and mutual understanding. SAAFF further has a strong directive to progress in projects involving SMART borders, AEO programme implementation, education, and awareness. With the help of trusted business partners, SAAFF aims to capitalise on big data and expertise to stitch the supply chain together to improve visibility and help foster a safe, competitive, and resilient industry.

The Architects of Supply Chain

Capacity building with the the Public/Private Sector Representatives We have noticed an incredible need for capacity building throughout our journey, engaging with our members and public sector representatives. Many of the issues that industry stakeholders face are due to a lack of knowledge on various topics, including best practice, policy coherence, international and local standards, and customs procedures. As a result, SAAFF has taken the initiative to launch its first ever training academy (SAAFFTA) in 2021, which offers targeted training solutions and capacity interventions for professionals and businesses in freight forwarding, logistics, customs, and the extended supply chain industry. SAAFF further recognises the important role technology plays in improving the linkages between all role players in the supply chain and the overall efficiency and, therefore, aims to play a significant role in providing futuristic skills development. In addition, SAAFF has long been the sole custodian of the FIATA Diploma in South Africa, collaborating with approved training providers. Other initiatives include the SAAFF-SARS Strategic Partnership: Operational Excellence, Building Capacity & Improving Compliance.

What our members think of SAAFF

For the first time in the 15-year history of my membership at SAAFF, I feel that I am receiving value for my membership. The new trajectory that SAAFF has taken under the leadership of Juanita is simply amazing! Ricky Pillay - ABC Kings I must say, the communication coming from the 'new' SAAFF is refreshing and I am impressed with the new website. Gordon Pascoe - Megafreight

Our theme at SAAFF for 2022 is “Our Season of Harvest”, where planning turns into action and dreams materialise into reality

2022 is a new year, with new chapters, new beginnings, and new horizons to pursue, overflowing with a plethora of opportunities for each one of us to make indelible impressions in our international trade landscape and sow the seeds of development, modernisation, and process improvement in our compliance environment. Some of our recent projects and achievements:

Control Tower monitoring the port’s capacity and performance to provide an overview of operations at the port of Durban for both container terminals. Port Health Statistics aims to provide a monthon-month update on clearance times at OR Tambo for a sample group, giving an overview of Port Health’s stops and timeframes. Weekly Cargo Movement Reports that provide the industry with a snapshot of the flows of the ocean, air, and cross-border road cargo in and out of South Africa.

AEO-S Compliance Drive to increase the number of AEO-S accredited clients and in so doing, assist SAAFF members to build capacity in our collaborative efforts to produce AEO-S compliance accredited clients. Extended Role Players in the Supply Chain (ERSC) private sector working group (ERSC-PS-WG) has been formed to address and remedy the current challenges plaguing our current international trade landscape.

Contact SAAFF to enquire about our strategic projects, membership and benefits. For more information visit our website: www.saaff.org.za Alternatively contact our office on T +27 11 455 1726 &ŽůůŽǁ ƵƐ͗

PUBLISHED IN JUNE 2022 To advertise in the upcoming issue of MANUFACTURING, please contact: Tarin-Lee Watts Business Development and Project Manager 087 379 7119 | 079 504 7729 www.businessmediamags.co.za wattst@picasso.co.za

PUBLISHER

PICASSO HEADLINE, A PROUD DIVISION OF ARENA HOLDINGS Hill on Empire 16 Empire Road (cnr Hillside Road), Parktown, Johannesburg Postal Address: PO Box 12500, Mill Street, Cape Town, 8001

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DIGI TA L SYS T EMS

Shoprite is one of the retailers operating modern integrated distribution centres.

Transport logistics

made easy?

JAMES FRANCIS investigates how digital technologies are impacting – and changing – the transport logistics industry

ew things express the convenience of our digital society as well as Uber. Customers can quickly order a car to take them exactly where they need to be, through one app. What started as a company where you could order limousine rides quickly became revolutionary. It radically cut the costs of taking a taxi and removed the ambiguity of hailing one in a foreign country – no more elaborate detours or uncertain destinations. Uber is effectively in the business of transport logistics: it moves people from place to place. Similarly, many goods logistics companies have also started to use digital systems to increase convenience. You can track a package across the globe via a courier service. Delivery people get their orders through apps, and it’s now common to sign a digital pad or snap a photo of a delivered parcel. Yet the above examples are quite simple relative to the complex nature of the heavier transport logistics industry, explains Naude Rademan, CEO of logistics platform Linebooker. “A lot of the transport industry is still very manual and not really transparent. You can make five phone calls for the same load on the same truck on the same site, but get a 40 per cent spread in price. There is a lot of paperwork and a lot of phone calls.” Increasingly, services such as Linebooker are changing that situation, but the pandemic has provided the most significant impetus for logistics to become more efficient and visible. KPMG notes in its paper, Six key trends impacting global supply chains in 2022: “The major logistics disruptions create a ripple effect across global supply chains that ultimately causes goods to pile up in storage, impacting those ships on their way to ports through diversion or being slowed down as they arrive at major transit hubs, thereby restricting global trade flows and limiting access for businesses to import products and refill their stocks of inventory.” Even though digital technology has been a part of logistics for some time (some of IBM’s earliest products focused on logistics and warehouse management), bottlenecks created by the pandemic have led to a massive cultural rethink and investment in digital logistics.

“Consider the multitude of online e-retailers such as Loot, Bidorbuy and so many more – these applications and businesses are nothing but logistics at your fingertips.” – Markus Nieuwoudt

FAST FACT

Logistics activities account for 12-13 per cent of global GDP, according to the World Bank. In South Africa, the transport, storage and communications sector contributes around 9 per cent of GDP, according to the Department of Transport.

E-commerce steps up Are such changes translating into the “Uber-fication” of transport logistics? That depends on which part of the logistics world we observe. The most visible example of a digitised logistics value chain is in e-commerce. “Apps such as Uber and the Checkers Sixty60 are just a few examples of mobile logistics applications that bring your desired groceries to your doorstep,” says Markus Nieuwoudt, director of Nieuforrest freight forwarding services and a chartered member of the Chartered Institute of Logistics and Transport: South Africa. “Consider the multitude of online e-retailers such as Loot, Bidorbuy and so many more – these applications and businesses are nothing but logistics at your fingertips. There are plenty of enterprise resource planning (ERP) systems in the industry that are used in every dynamic of the supply chain.” Shoprite Holdings, owner of retail outlets such as Checkers, Usave, OK and Shoprite, is one company investing deeply in modern logistics. Most notable is its warehouse ›

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DIGI TA L SYS T EMS

A combination of digitisation, efficiencies and customer expectations is changing how transport and warehouse logistics operates.

Logistics in the platform economy Though e-commerce shows the value of digital logistics, it’s not always that straightforward. Shoprite and Amazon have invested millions in software platforms that connect all the dots, but not many transport companies and customers can do the same. This has prompted demand for logistics service platforms. Linebooker is a home-grown example of this new service model. Rather than run a transport company or warehouse, Linebooker has created a software platform that provides users with access to a broader market of transport providers, along with transparency in pricing and other matters. “We built the first platform version just to give customers the ability to interact with lots of transport companies on a transparent basis and request either fixed or variable pricing,” explains Rademan. Using Linebooker, both transportation companies and customers can find each other, bid with their best offer, and gain other advantages such as preferential diesel rates or payment coverage to shore up

A BRIEF HISTORY OF LOGISTICS • 3000 BCE: The Mesopotamian kingdom of Uruk seals clay tokens inside fired clay balls to act as delivery contracts. • 130 BCE: The Han Dynasty in China makes the Silk Road official, connecting trade with the Middle East and Europe. • 14 CE: Rome establishes a state-run postal service. • 900 CE: Trade caravans moving across North Africa, the Middle East and Far East enter their golden age. • 1602 CE: The Netherlands establishes the Dutch East India Company to protect its trade routes and help fund its fight for independence against Spain. • 1698 CE: Thomas Savery invents the first commercially used steam engine, opening the doors for industrialisation and trains. • 1852: The first private courier company, Wells Fargo, opens its doors. • 1939 CE: Industrial-scale logistics management becomes a key focus during World War II. • 1956 CE: Malcolm McLean invents the first standardised shipping containers. • 1963 CE: IBM develops a computerised forecasting and inventory management system. • 1982 CE: British logistician Keith Oliver coins the term “supply chain management”. • 1994 CE: Amazon is established. • 2009: Uber is established, soon leading to the app-ification of transport.

cash flow. These all extend from one platform, creating a centralised software system that can scale and add services as needed. Platforms are the unsung heroes of digital logistics. Linebooker started with an ambition to create market transparency around transport costs, but could expand into a multi-service marketplace for logistics providers and customers. Other services, such as Fastlane by AGS Transact, use platforms to manage fuel for transport trucks. Among those examples, the use of apps to streamline logistics is becoming prolific.

A long way to go Yet for all the new-found convenience, the logistics world still has a long way to go, explains Charles Dey, training consultant for International Supply Chain and Logistics Management, and fellow of the Chartered Institute of Logistics and Transport: South Africa. “If the word ‘logistics’ means ‘the local movement of goods’, then the digitisation of the processes involved is relatively simple. However, if ‘logistics’ relates to the international movement of goods, then this is a far more complex matter involving interlocking contracts, coordination of processes and procedures carried out by independent service providers, and compliance with increasingly complex regulatory measures.” Moving goods internationally remains difficult and ensnared in manual processes. Besides the pandemic bottlenecks, there are concerns over environmental impact and conflicting customs regimes. But that may be the next big opportunity, especially for Africa and the newly established African Continental Free Trade Area. According to the Brookings Institution, only 16 per cent of African trade happens within the continent, as opposed to Europe (67 per cent), Asia (60 per cent) and the Americas (46 per cent). Much of that has to do with sovereign red tape and costly logistics, but digital logistics could represent a leapfrog moment for the continent. Maybe the Uber-fication of transport logistics will become the continent’s next success story.

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complex in Cilmor, Cape Town, a sprawling site that distributes goods to its stores across the Western Cape region. Highly integrated with the company’s central ERP platform, the site manages goods from more than 600 suppliers, stockpiling countless products on tens of thousands of pallets and shelves. Relying on computerised planning and voice-command technologies, its operations run smoothly for such a massive site. This type of digitised logistics infrastructure makes products such as Checkers’ Sixty60 delivery service possible. More examples of such next-generation logistics are coming online every day. The best known is Amazon’s sprawling, technology-driven transport network and its experiments with robotic shelves and drone deliveries. Yet logistics companies don’t have to go that far; for most, it’s visibility and access to data that bring the biggest changes. “Today, in a world of just-in-time supply chains, global trade and growing e-commerce, speed, flexibility, and knowledge mean everything,” says Kami Viswanathan, vice president of marketing for FedEx Asia-Pacific, Middle East and Africa. “Our transformation has been accelerated by external circumstances, but also enhanced by new capabilities at our disposal.” We are leveraging the power of data science and machine learning and we are generating more insights to help unlock greater visibility into a shipment’s journey. These insights, powered by the information about the package and distilled by cutting-edge artificial intelligence and machine learning, help inform decisionmaking for, and with, our customers.”

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L INEBOOK ER A DV ER T ORI A L

RIDE-SHARE FOR THE FREIGHT AND TRANSPORT INDUSTRY Why struggle with the same small pool of transport services when you can have access to hundreds of companies and thousands of trucks, virtually instantly?

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he advent of ride-sharing platforms revolutionised the personal transport industry, allowing people to access a reasonably-priced ride within minutes, thereby opening up a new era of travel. Naturally, what works for the private sector can also be tweaked to suit the commercial sector, which is exactly what Linebooker has done for the South African transport and logistics industry. The company has developed a platform that allows companies requiring freight to be moved to improve their supply of trucks when they most need it. “Essentially, Linebooker is designed to help you move stock on a fixed lane-rate basis – with guaranteed supply or variable lane rates – utilising any of South Africa’s top-rated transport companies that are operating on the platform. As with ride-sharing platforms, businesses can expect a transport cost reduction of approximately 12 per cent, along with improved vehicle supply. Naturally, the Linebooker platform provides full visibility, tracking updates and data on all subcontractors,” explains Linebooker CEO Naudé Rademan. Linebooker, he notes, works with the top-rated transport companies in South Africa to solve your truck supply issues. This means that you have access to 501 transport companies with 15 900 trucks and growing, while you also have a choice between fixed

LINEBOOKER TECHNOLOGY ALLOWS THE COMPANY TO MATCH LOADS WITH AVAILABLE TRUCKS QUICKLY, CONNECTING CUSTOMERS TO HUNDREDS OF PRE-VETTED TRANSPORT COMPANIES, ALLOWING THEM TO CHOOSE WHO THEY WANT IN THEIR SUBCONTRACTOR POOL. lane rates with a service level agreement in place, and/or variable rates. “From its start-up stage in early 2017, Linebooker has created a level of disruption in the industry that continues to grow. Over the past few years, the company has grown to provide critical freight services to several large South African blue-chip companies and brands, mega farmers, mining organisations, and other businesses both large and small. “We did not set out to disrupt – the central business idea is not complex, although translating the idea into a total online solution was a different story. But essentially, it was a very simple change that caused the disruption – our platform created instant transparency in a marketplace that up to that point had very little,’’ adds Rademan.

A BETTER TECHNOLOGY From a South African perspective, the logistics industry and, particularly, the road transport sector is a significant part of the economy, with an estimated annual spend of R274-billion (total logistics sector estimated at R480-billion),

according to Business for South Africa’s April 2020 report on the importance of the logistics industry in South Africa. “Clients today are mostly exposed to Transport Management Systems (TMS) as the most-sold term when transport technology is involved. These types of systems usually provide a one-dimensional solution in a closed circuit. Linebooker technology allows customers to better manage their current transport service providers with full visibility and tracking updates for any number of subcontractors on one platform. Plus, the platform offers the ability to connect instantly with all other top transport companies in South Africa on fixed lane rates or ad hoc lane rates for urgent loads.” Rademan explains that Linebooker technology allows the company to match loads with available trucks quickly, connecting customers to hundreds of pre-vetted transport companies, allowing them to choose who they want in their subcontractor pool, while also ensuring they receive trucks at the best lane-rate levels in the market.

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“For customers, lower costs are always important, and Linebooker’s transparency and large network certainly deliver significant savings. But we know that the real long-term benefits for a customer sit in the efficiency created by the technology, outside of lane-rate cost only. Customers see much better vehicle supply consistency, as they can communicate efficiently with current service providers or request trucks within 30 minutes from the platform’s large active supply base.“It should be obvious to anyone looking at the speed of new technology developments today that, to remain competitive, it is critical to begin utilising new technology solutions. When considering a technology solution, such as a TMS, consider cost, the complexity of contract terms, implementation timelines, and the ability of your employees at all levels to use the technology without training,” Rademan adds. This is where Linebooker sets itself apart, he continues, as it aims to provide clients with an easy-to-implement platform that is cost-effective enough that even small businesses can afford and implement it easily. With this platform, they can manage all their transport operations in one place while maintaining full control and choice on lane-rate pricing and the service providers they use.

AN AUTOMATIC BUSINESS CONTINUITY PLAN Linebooker aims to be the platform that improves the lives of all players in the transport

industry by providing customers affordable easy-to-implement technology to manage all their transport operations and engage with any transport company in South Africa, which Linebooker has already vetted and approved as credible operators. “Businesses have realised the benefits of online technology-driven ways to manage their operations, giving them more speed and flexibility and allowing them full visibility while staff are working remotely. We do believe transport operations that have traditionally been run manually without any visibility will continue to migrate to integrated platform solutions to manage this,” says Nick Hoffman, the company COO. “For customers wanting to access the bidding marketplace to arrange transport, the customer experience is fully integrated. Any customer can register online, gain access to the platform, and book a truck without any intervention or contact required with the Linebooker team unless requested.” He points out further that, until now, an industry bane has been the difficulty in engaging or co-ordinating with the many quality transport companies in the country to ensure a consistent supply of vehicles throughout the year. This, he says, is the key to Linebooker’s platform; its technology allows customers to use an unlimited number of transporters, chiefly because the challenging issues of load planning, allocation, tracking, proof of delivery and payment are all automated on the platform.

“LINEBOOKER IS DESIGNED TO HELP YOU MOVE STOCK ON A FIXED LANE-RATE BASIS – WITH GUARANTEED SUPPLY OR VARIABLE LANE RATES – UTILISING ANY OF SOUTH AFRICA’S TOP-RATED TRANSPORT COMPANIES THAT ARE OPERATING ON THE PLATFORM.” – NAUDÉ RADEMAN 52

“Customers often take on significant business supply chain risks because they do not have immediate access to a larger fleet of trucks at times when their volumes, routes or truck types change. A business continuity plan in most cases does not exist,” says Hoffman. “Linebooker is that automatic business continuity plan, offering nothing less than access to just under 16 000 trucks via one vendor.”

AUTOMATION AND LIVE UPDATES A key challenge faced by sales managers is that they previously had no live access to data on transport movements or costs, making it very difficult to manage customer service. In addition, although transport is in the top three costs for businesses, there has been, to date, little oversight of costs due to the lack of proactive data visibility. Once again, Linebooker has resolved this difficulty as the platform provides live visibility and data dashboards for sales managers, which enables them to drive better decision-making while also improving customer service and reducing costs. “There are no pricing standards in the industry to guide customers and transport companies on what relevant market lane rates on certain routes and seasons should be. The Linebooker platform, meanwhile, acts as a self-regulating marketplace and delivers lane-rate pricing that is driven by market dynamics, making it a true indication to customers and transporters of lane-rate levels,” explains Hoffman. “We understand that daily booking of trucks and following up on load progress is a manual process that wastes significant amounts of time, which could be better spent on core functions, like managing factories or

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BENEFITS OF USING A TRANSPORT PLATFORM Transport companies that embrace transport platforms gain the benefit of: • quickly finding loads without the payment risk typically attached to new or unknown cargo owners • better cash flow management because of guaranteed on-time payment • reduced empty legs and administrative documentation burdens • access to lower fuel prices via bulk fuel procurement • tracking technologies that reduce the workload on control room operators • lowered insurance and finance costs • improved agility in the supply chain, thanks to increased market participation between customers and transporters on the platform, which is enhancing collaboration opportunities.

warehouses, not to mention customer service. Moreover, transport costs for cargo owners are often inflated by around 15 per cent, simply because of manual interactions with a limited number of transporters.” Rademan suggests that a lack of transparency and real-time data in these traditional brokerages and manual dealings results in inflated supply chain costs. The transportation markets are increasingly volatile, he adds, due to many current economic and social factors impacting the industry. “Linebooker’s focus has been on providing customers with technology solutions that deliver accountability and transparency while addressing challenging transportation environments in a large, old-school and under-regulated market. “To this end, all load bookings with transporters and all load progress updates happen live on the platform for users to see in real-time. This means that operators only have to deal with anomalies – on average around 5 per cent of the time – historically, they spent 100 per cent of their valuable time dealing with booking trucks and following up on load progress.”

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THE FUTURE OF TRUCKING When using traditional systems, the customer also does not have a view of the total pool of transporters available in the country, meaning they end up selecting from the same group with significant indirect influence on noncompetitive pricing. Having immediate access to a larger pool of transporters reduces costs and increases service levels via better availability of trucks. “We also understand that for transport companies, cash flow is one of the biggest business risks as customer payments are

THE PLATFORM PROVIDES LIVE VISIBILITY AND DATA DASHBOARDS FOR SALES MANAGERS, WHICH ENABLES THEM TO DRIVE BETTER DECISION-MAKING WHILE ALSO IMPROVING CUSTOMER SERVICE AND REDUCING COSTS. regularly delayed, and companies do not necessarily have the customer leverage to resolve the payment delay and/or the cash flow to continue operations until payment is made,” says Rademan. “Linebooker takes on this risk on behalf of transport companies. We guarantee payment and handle payment delays from customers. As another bonus, transporters can also choose to fill up with diesel at the best market rate through Linebooker Diesel Assist, using their Linebooker payment balance, thereby increasing transporters’ leverage to take on more loads.” In South Africa, logistics and supply chain decision-makers are finding themselves in an increasingly tricky, crisis-driven world, he notes. Contingency plans, business continuity, and cost reduction are top priorities and a reason for the increasing use and popularity of co-ordination technologies and platforms in supply chains. “Linebooker is having a significant impact on the country’s transport economy, and there remains wide scope for growth. In just four years, we have signed up a vast array of small, medium and large businesses, including several blue-chip clients. This has lowered logistics’ costs for clients, streamlined load

allocation to providers, increased operational execution, and allowed complete transparency, with live visibility of all load statuses and automated reporting any time. “Between enabling truck availability within 30 minutes through open bidding, and no more than one week for a full business-specific transport technology solution, Linebooker is the answer to your logistics nightmares. Transport platform, digital freight matching, call us what you will, Linebooker is the future of trucking,” concludes Rademan.

➔ Scan this QR code to go directly to the Linebooker website.

For more information: 021 201 6969 info@linebooker.com www.linebooker.com

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T ECHNOL OGY

Smart technology, smart investments There are many ways technology can assist the supply chain. It’s all about making the right investments, writes ITUMELENG MOGAKI

availability of its gas transporters due to the streamlined management of inbound and outbound delivery truck inspections. According to Zebra’s 2024 Warehousing Vision Study, automation will enhance worker performance, rather than replace workers, during the next few years. In other words, robotic automation solutions will serve as allies to workers, allowing people to focus on more strategic tasks while the robots take care of the mundane, repetitive tasks such as materials handling. To that end, Zebra designs its hardware, software and services solutions with front-line users, workplaces and workflows in mind. Tasks that require walking will shift to robotics solutions, both in the warehouse and in factories. Tasks like getting a worker to inspect a product visually before making a decision will shift toward machine vision, RFID and sensor technologies, powered by intelligent software platforms. These technologies will be stitched together to ensure proper execution that matches or improves the productivity of workers, allowing for more time to be reallocated to tasks that help drive better customer service.

Huge impact

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etter and safer ways of moving goods are one positive impact businesses can expect from their technology investments. This is according to Neil Gouveia, sales director at Zebra Technologies (Africa). “Yard operations have increasingly seen cutting-edge technologies such as realtime location solutions and radio-frequency identification (RFID) being implemented to complement warehouse and transport management systems, and to automate data capture and decisionmaking across larger and more complex operations,” says Gouveia. He adds that these technologies can provide Neil Gouveia unprecedented visibility into every corner of operations, helping transport and logistics providers make more informed decisions and gain a competitive advantage. Implementing RFID tags on lorries to facilitate inbound and outbound scheduling, door-to-door moves, and automatic parking assignments is just one example. Gouveia gives an example of an energy company that implemented a rugged, tablet-based mobility system that – in combination with

CRITICAL TRENDS Augmented data intelligence and embedded AI and analytics are going to be critical trends to watch in 2022, says Neil Gouveia of Zebra Technologies (Africa), but no one will assume workers have all the answers to any question. Organisations will rely on machine-powered aggregation and analysis of data points to form new business strategies and inform actions all the way to the edge of the enterprise. They don’t know what they might be missing until an objective and more critical third-party AI can effectively assess the situation, account for outlying factors and advise on the best next move. its yard management system – led to betterinformed transportation scheduling and routing decisions, based on actual supply and demand of both gas tanks and delivery trucks. These technologies helped this business eliminate the physical logjams that had historically challenged its natural gas production facilities. In fact, during early deployments of the solution, the company achieved a 50 per cent increase in the

Gavin Kelly, CEO of the Road Freight Association, says that AI and related technologies have already had a huge impact on the supply chain sector. “The obvious gains have been in accuracies relating to orders (picking), route selection and despatch, consolidation of consignments, tracking of deliveries and proof of receipt.” Kelly says the greater benefits lie in realtime control of stock levels across various platforms and holding centres, critical inventory-level management, cash flow and capital management. “Other benefits include reverse logistics (including warranties and returns due to customer requirements) and the management of shrinkage, with linked-in security and safety systems. “A large amount of routine, manual administration has been taken over by automated systems. This has influenced many consumables (like paper and printing requirements), but by and large has removed many large error margins.” Kelly acknowledges that there are debates around AI being able to take “moral” decisions. Currently an action can be decided on the non-conformance of an object – for example mass, size, colour, temperature and so forth. “The ability for AI to acquire and apply human values relating to responsibility, common sense and experiential inflected decisions is probably far off, and up for discussion.”

“A large amount of routine, manual administration has been taken OVER BY automated systems.” – Gavin Kelly S U P P LY C H A I N M A N A G E M E N T

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T HOUGH T L E A DERSHIP

Integration across platforms helps remove

supply chain friction

he route to market in South Africa, and Africa in general, faces unique challenges around line of sight, specifically relating to technology. One of these is the fact that there are multiple levels of distribution, from the wholesalers that run large database systems to the spaza shop owners that often run their businesses on paper and with a cash economy. This makes end-to-end line of sight difficult to achieve, so in order to maximise returns, distributors need to be flexible in the methods they use to engage with their customers. There is no one-size-fits-all approach to such a diverse market, but seamless integration and consistent messaging are critical in removing communication as a friction point in the supply chain, while ensuring that the customer comes first throughout the process. Andrew Dawson Many providers are focusing on delivering cutting-edge apps that allow retailers to create a business environment that can easily manage stock, sales and other features. However, these communication platforms are only relevant to retailers with access to a smartphone and data connection. If distributors focus their efforts solely on this,

they risk alienating the main market, which is a significant portion of their sales. A solution that incorporates USSD (Unstructured Supplementary Service Data) into the platform can be useful, because it does not require a smartphone, data connection or web browser. In addition, for distributors looking to drive sales and engagement, a call centre can still be highly effective at targeting all customers in the market. The key is to ensure consistent messaging across the various communication channels, which is the end goal of any omnichannel communication strategy. However, it is essential to understand that creating such a strategy is not just about throwing the latest technology at the problem and “having an app”. Instead, it is about having different layers of technology that enable distributors to engage with and meet the changing needs of their retailers.

Consistent and seamless The ultimate goal is seamless, customer-centric integration from the manufacturer through to the wholesaler, bulk-breaker and all the way to merchants. Each touchpoint should reflect the same look and feel, the same messaging and the same engagement style, so that no matter how a merchant chooses to engage with the channel, everything is consistent. Consistent messaging and seamless integration also allow for integration of data. All parts of the platform work off the same data, providing the same view of the

The ultimate goal is seamless, customer-centric integration from the manufacturer through to the wholesaler, bulk-breaker and all the way to merchants. 56

customer while giving them the same view of the product or brand. Irrespective of the technology layer retailers use, distributors require a single solution that enables them to deliver consistent messaging around products, pricing, loyalty and strategy, from a single engagement. This is key to generating a return, and growing a successful and prosperous customer base, from large retailers to the main market. They also need a solution that breaks down data silos and provides access to all the data and intelligence produced by the distribution chain.

Partnering up Partnering with the right technology provider is essential in bringing together these various datasets, centralising them and enabling a single pool of data as well as a consistent messaging strategy, irrespective of the technology layer. The right partner will also ensure that the value of voice communication is not underestimated – as omnichannel communication is not just about apps, data and enterprise-grade solutions. In the South African market, a phone call is a massively powerful, cost-effective communication tool. The key is to make it easy for retailers to engage in conversation when they need to, through the medium they want and which is preferred by their market. This is the foundation of creating frictionless engagement, which in turn is essential to ensuring that retailers are buying distributors’ products. Furthermore, this ensures customers are being put first at every stage of the supply chain, and that their needs and changing demands are constantly being catered for. An omnichannel strategy should focus not necessarily on technology, but on making it easier to engage with customers, ultimately making it easier to trade. This will create a new focus that will ultimately drive up sales.

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ANDREW DAWSON, MD of MACmobile, looks at seamless communications options for the South African market

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SK IL L S DE V EL OPMEN T

Change makers needed for

sustainable supply chain management Supply chain management is an evolving field, and the shift to sustainable practices requires people with the necessary hard and soft skills to drive this change, writes ANÉL LEWIS

outh Africa is the 14th-largest emitter of greenhouse gas in the world and the main emissions culprit in Africa. If the country aims to meet its net zero emissions target by 2050, more needs to be done to ensure that supply chains – which is where businesses are likely to have the most significant environmental impact – become more sustainable.

What is sustainable supply chain management? Much of our economic activity is generated in and through supply chains, where the movement of goods and services contributes to increasing levels of carbon emissions, says Marzia Storpioli, lecturer in supply chain management at IMM Graduate School. “Supply chains therefore have a responsibility to mitigate the impact of their activities on environmental and human resources.” Wesley Niemann, programme lead for the MPhil programme in supply chain management at the University of Pretoria, agrees that the need for sustainable supply

FAST FACT

A typical supply chain generates far more greenhouse gas emissions than in-house operations: it’s responsible for more than 80 per cent of the average consumer-goods company’s emissions and more than 90 per cent of the impact on air, land, water, biodiversity and geological resources. Source: McKinsey & Company chains is a response to the impact of these operations on the environment. “To ensure their supply chains are sustainable, companies need to take a holistic approach, focusing on environmental, social and economic matters.” He adds that a supply chain that is fully sustainable ensures socially responsible business practices. Sumayah Goolam Nabee, lecturer in the Department of Transport and Supply

“To ensure their supply chains are sustainable, companies need to take a holistic approach, focusing on environmental, social and economic matters.” – Wesley Niemann

Chain Management at the University of Johannesburg, says: “As supply chains have evolved, the focus has shifted from increasing revenue streams and profit to considerations around the environment and the human impact of products as they move along the supply chain.” This applies to raw materials, production methods, modes of transport and other aspects of the supply chain.

Supply chain expertise Natasha Parmanand, managing director of operations for Sub-Saharan Africa at FedEx, says, “Sustainability in the supply chain works best when there is effective and efficient delivery of goods at the right time, at the right place with maximum efficiency – while minimising the impact on the environment.” This approach requires specific skills to meet the demands of change, adds Parmanand. This includes advancing the skills set of a company’s employees and partners. “A sustainable supply chain ensures that Natasha Parmanand businesses, service providers, and regulators all play a positive role in providing the efficient delivery of goods. Our role as a supply chain leader is to enhance the skill sets of our employees and partners to meet these demands,” notes Parmanand. Niemann says uppermost on the list of skills for supply chain sustainability are vision, the ability to lead and communication. “You have to build a network of people who are passionate about this as an important and worthwhile endeavour.” This feeds into the need to nurture long-term strategic relationships that can help develop solutions to sustainability challenges. He adds that ›

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CASE STUDY: UPSKILLING SMALL BUSINESSES

the adoption of Fourth Industrial Revolution technology has elevated the importance of digital and analytical skills. Nabee says establishing a sustainable supply chain is not so much about honing different skills, but about focusing on existing expertise to achieve sustainability. “To this, collaboration among all stakeholders is perhaps the most important skill driving sustainability.”

Hard and soft skills “Supply chain management may seem straightforward or even robotic and mechanical in nature,” says Parmanand. “However, successful professionals in the industry require a combination of soft and hard skills.” Soft skills include a “profound appreciation” of the daily realities faced by the societies through which a supply chain moves, says Storpioli. This calls for “courage to place people and the planet before profit” and the ability to deal with conflict. She adds that the hard skills required to manage a sustainable supply chain include analytical expertise, scenario planning and knowledge of the principles of contract. Those in sustainable supply chain management should be able to communicate effectively, plan and take initiative, make ethical business decisions and negotiate well, adds Parmanand.

Education and training Formal education in supply chain management is essential, says Storpioli. “Each part of the supply chain is a specialised function that must be appreciated and understood. Also, as the pace of change in supply chain management accelerates, there is a need for continuous professional development.” Practical experience, which can be gained through internships or practical courses, is also important. A number of universities and private training providers offer a progressive range of formal undergraduate and postgraduate qualifications in supply chain management, complemented by continuing education courses and programmes, says Niemann. Regent Business School, as an example, offers a BCom degree in supply chain management with a combination of theory and practice. The qualification is designed to cater for the “rapid pace of business and the continued integration of world economies”. Institutions such as Technical Vocational Education and Training colleges provide hands-on skills training. The South African Production and Inventory Control Society, the professional body for supply chain management, also provides fit-for-purpose education, training and knowledge. Jacques de Villiers, head of supply chain at Omnia Group, says Omnia conducts

NURTURING RESILIENCE Omnia Group has made significant changes to the end-to-end supply chain life cycle in order to identify opportunities for integration, says head of supply chain Jacques de Villiers. “We have seen significant benefit from an environmental point of view, by focusing on localising supply to service customers where it makes sense. This optimisation has reduced our carbon footprint and eliminated duplication of effort and reduced waste. The alignment and optimisation of systems, people and processes, underpinned by a customer-centric focus, ultimately support food security in the region.” De Villiers says that as even well-established supply chains can become undependable, especially during challenging times. As witnessed with the disruptions wrought by the COVID-19 pandemic, supply chain resilience is key. “We believe in leveraging capabilities and knowledge across the Omnia Group and our network of supply chains. Continuous improvement and agility are important for resilient supply chain practices.”

research on local and global market trends to benchmark and learn from peer companies, thereby growing their knowledge base in supply chain practices. Nabee adds that the role of institutions is to provide training that is relevant to the changing needs of business and government. “Institutions should ensure that the worlds of learning and work are complemented.”

Supply and demand Supply chain management, already deemed a scarce skill, is evolving rapidly. Sustainability is a key objective, and with technological innovations disrupting the traditional supply chain network, the demand for specialised skills is going to accelerate. Niemann says education and training institutions therefore have an important role to play in addressing this skills shortage. “These institutions have a mammoth task in producing qualified graduates for an industry at the economic heart of the country.” Developing and improving supply chain management skills are important for productivity, but also for enhancing the innovation capacity of the industry and economy, he adds. Storpioli says institutions have a pivotal role to play, not only in educating and transferring important skills, but also in increasing awareness of the need for new thinking among supply chain professionals. “In the future, supply chain leaders must become change makers and innovators in the way our supply chains operate. They must drive from within solutions as to how to achieve profits while protecting and enhancing the resources that contribute to the supply chain’s success and sustainability.”

IMAGES: ISTOCKPHOTO.COM, SUPPLIED

“Collaboration among all stakeholders is perhaps the most important skill driving sustainability.” – Sumayah Goolam Nabee

Anglo American’s Zimele Enterprise Development programme supports the creation of sustainable businesses for people who live near the company’s mines. Zimele hosts sessions with these business owners on the skills needed to run a successful business. These include training on Anglo American’s tender processes, how to price effectively and how to access markets. Some of the hard skills identified for a successful supply chain include financial management, bookkeeping, responding to tenders and project management. Furthermore, soft skills like problem solving, decision making, conflict resolution, negotiation and analytical thinking will put you in good stead for all careers, says the team at Zimele.

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Department of Business Management

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Supply Chain Management Master the complexities and dynamics of supply chains with a from the University of Pretoria The Department of Business Management is a centre of excellence in the Faculty of Economic and Management Sciences at the University of Pretoria, with the aim of contributing towards the development of supply chain management practice, education and research in Africa. We strive to keep South African industry at the cutting edge of new development through access to both local and international knowledge.

programmes in supply chain management designed to develop management potential and competencies at all managerial levels.

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Supply Chain Management: BCom (ELA Accredited programme) BCom Honours MCom/MPhil PhD Continuing Education programmes and short courses in Supply Chain Management: Programme in Supply Chain Management Advanced Programme in Supply Chain Management Executive Programme in Supply Chain Management Programme in Production and Operations Management Fleet Management Contract Management PFMA Bid Adjudication Business Process Management Business Process Modelling Customer Service Excellence Negotiation Skills

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Supply Chain Management March 2022

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TECHNOLOGY

LOGISTICS, FREIGHT AND WAREHOUSING

CONSULTING

CHEMICALS

FREIGHT FORWARDING

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FREIGHT CERTIFICATES

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