7 minute read
MATERIALS HANDLING
Materials handling in the FMCG space
RODNEY WEIDEMANN unpacks changes and challenges around handling goods in this dynamic space
Over 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
IMAGE: SUPPLIED
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.
Automating and optimising supply chain operations
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
The 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.”
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.”
