Issuu

OCTOBER 2020

C A N A DA’ S S U P P LY C H A I N M AG A Z I N E

NOW INCLUDING:

Canadian Shipper

MAKING KAYAKS

FASTER How ClearWater Design rode the 2020 wave of demand for outdoor sports equipment

i The next normal i Automating the middle mile Publication mail agreement #43008019

i Canada’s new western railway

INSIDELOGISTICS.CA

DRONE TECHNOLOGY THAT WORKS FOR YOU. Air Canada Cargo is proud to partner with Drone Delivery Canada to help businesses like yours improve efďŹ ciency with innovative drone solutions for your logistics. To ďŹ nd out more, please visit aircanada.com/dronesinfo today.

NOW INCORPORATING

CANADIAN SHIPPER C A N A DA’ S S U P P LY C H A I N M AG A Z I N E OC TOB E R 2 0 20 • V O L UM E 6 5 • NU M B ER 0 5

CONTENTS In every issue:

Taking Stock

Supply Chain Scan

When opportunity knocks

News and numbers from around the world

Movers + Shakers

Appointments and promotions

Product Innovations

The next normal

Automated warehouse vehicles

36 Safety First

Prep for the second wave

37 The View with Lou Get ready for the ELD mandate

The Bigger Picture

Forgotten frontline workers ON THE COVER | PAGE 14

SUPPLY CHAIN SCAN

Cover photo: © Daniel Vaughan (vaughangroup.ca)

insidelogistics.ca

Covid-19 best practices for shared equipment

The push is on to prepare for Covid-19 vaccine logistics

How to move your robotics project from dream to reality

How CETA is affecting Canadian trade three years in

Forktruck safety

Vaccines

Robotics

Trade

Because itâ€™s the shortest route Ship your goods faster with our 200 mile advantage from the East Coast. CPâ€™s shorter access between Port Saint John and Montreal, Toronto and Chicago means faster shipping to and from global and regional markets. Providing superior optionality, our network and services have the capacity to grow, creating new solutions and opportunities to support your business.

cpr.ca/ PSJ

TA K I N G S T O C K

insidelogistics.ca EDITOR IN CHIEF: Emily Atkins (416) 614-5801 emily@newcom.ca SALES MANAGER: Anthony Buttino (416) 614-5830 (514) 292-2297 anthonyb@newcom.ca CREATIVE DIRECTOR: Tim Norton (416) 510-5223 tim@newcom.ca PRODUCTION MANAGER: Jwad Khan (416) 510 6845 jwad@newcom.ca CIRCULATION MANAGER: Pat Glionna (416) 697-0049 MANAGING DIRECTOR, TRUCKING & SUPPLY CHAIN GROUP: Lou Smyrlis lou@newcom.ca

NEWCOM MEDIA INC . CHAIRMAN & FOUNDER: Jim Glionna PRESIDENT: Joe Glionna Inside Logistics, established in 1956, is published six times a year by Newcom Media Inc. HEAD OFFICE 5353 Dundas St W. Suite 400, Toronto, ON, M9B 6H8 SUBSCRIBER SERVICES To subscribe, renew your subscription or to change your address or information contact mary@newcom.ca or 416 614 5831 or visit our website: www.insidelogistics.ca/subscribe SUBSCRIPTION PRICE PER YEAR Canada $84.95 per year, Outside Canada $159.95 US per year. Single copy price: Canada $15.00, Outside Canada CA$32.65 Inside Logistics is published six times per year except for occasional combined, expanded or premium issues, which count as two subscription issues. ©Contents of this publication are protected by copyright and must not be reprinted in whole or in part without permission of the publisher. DISCLAIMER This publication is for informational purposes only. You should not act on information contained in this publication without seeking specific advice from qualified professionals. Inside Logistics accepts no responsibility or liability for claims made for any product or service reported or advertised in this issue. Inside Logistics receives unsolicited materials, (including letters to the editor, press releases, promotional items and images) from time to time. Inside Logistics, its affiliates and assignees may use, reproduce, publish, re-publish, distribute, store and archive such unsolicited submissions in whole or in part in any form or medium whatsoever, without compensation of any sort. PRINTED IN CANADA

Publications Mail Agreement #43008019, ISSN: 0025-5343 (Print) ISSN: 1929-6460 (Digital). Inside Logistics is indexed in the Canadian Magazine Index by Micromedia Limited. Back copies are available in microform from Macromedia Ltd., 158 Pearl St., Toronto, ON M5H 1L3

When opportunity knocks “WHEN YOU SEE AN OPPORTUNITY like this, you grab it.”

It’s this attitude that propelled Canadian canoe, kayak and paddle board manufacturer ClearWater Design to its best year ever in 2020. Owners Michelle Laframboise and Ian Crerar spent little time worrying about the pandemic’s effects on their business, instead throwing themselves into recovery mode until the outdoor sports market exploded in early summer, propelling their business into top gear. This is one of the success stories coming from the pandemic, which we explore starting on page 14 of this issue. The theme of entrepreneurship continues with two more Canadian success stories. We talk with the principals of an autonomous driving start-up that is focused on middle-mile trucking and Canada’s newest railway. In completely different ways these two entrepreneurs are solving logistics challenges for the future, and putting this country at the forefront of exciting innovation. The key is seeing a problem as a challenge that needs to be solved. The team at ClearWater Design did it by doubling production in a matter of a few days to meet unprecedented demand for their products. NuPort Robotics, the middle-mile trucking company, is doing it by narrowing down the autonomous driving problem to one solvable segment, thus increasing their chances of success. And the Alberta to Alaska Railway is stepping in to finally complete a vision that was born in another century, but meets a thoroughly contemporary need. Nobody is guaranteeing their success, but in all three cases they knew they had to try. I admire that ability to see the finish line, even when it’s a long way downstream, and far in the future. It exemplifies the qualities of optimism and forward thinking that are key to successful business ventures. For a glimpse at the next normal in our Covid-19-altered world, we spoke to a number of supply chain professionals and share their views, on how the pandemic will possibly permanently change business, starting on page 18. I hope that our pandemic success stories, along with these perspectives, will inspire you to see the challenges that no doubt lie ahead as opportunities to innovate and rise above. If you’d like to share your story, please drop me a note at emily@newcom.ca or look me up on LinkedIn.

MEDIA INC. FUNDED BY THE GOVERNMENT OF CANADA

insidelogistics.ca

PREPARING FOR COVID-19 VACCINE LOGISTICS. DETAILS ON PAGE 27.

SU PPLY C H A I N S C A N |

By John G. Smith, Today’s Trucking

Walmart Canada recognized for blockchain solution RISING TIDES Seaports under threat

9 MOVERS + SHAKERS Appointments and moves in the supply chain sector

10 COMPLEXITY Supply chain pros having trouble keeping pace

11 MONTREAL Who pays for cargo diversions

WALMART CANADA AND BISON TRANSPORT

have enjoyed a long-lasting business relationship, but it had become a billing nightmare. Invoices linked to the retailer’s freight were disputed more often than not. Challenges were so commonplace that weekly meetings were needed to review the documents line by line. The challenges weren’t unique to Bison, either. Walmart Canada relies on about 60 carriers to move close to 500,000 loads per year, and during peak periods it was disputing almost 70 percent of the related invoices. Everything from demurrage fees to accessorial charges must be accounted for, drawing on close to 200 variables and sometimes conflicting pieces of information. “It was really a ton of highly manual, completely non-value-added work,” says Francis Lalonde, Walmart Canada’s vice-president – transportation. A dramatic solution emerged over the last 18 months in the form of a partnership with Torontobased DLT Labs, creating what’s described as the world’s largest industrial-grade blockchain. The system, known as DL Freight, is a common electronic ledger that hosts every document or piece of data associated with a shipment. Underlying blocks of time-stamped information can’t be changed, leading to something recognized as a “single source of truth”. This makes it possible to calculate shipping charges in real time, complete with the automated checks and balances using data generated through the Internet of Things. Demurrage fees, for example, can be triggered using the GPS data from a truck that passes through a geofence. Final invoices are automatically fed into the enterprise resources plan-

ning (ERP) system and paid. Disputes with third-party carriers have plunged 97 percent in a matter of months, and the Council for Supply Chain Management Professionals has cited the Walmart Canada and DLT Labs project as one of six finalists for its Supply Chain Innovation Award. During one recent check by Bison, there was one single disputed transaction in a day. Before the system was introduced, the fleet was dealing with hundreds or even thousands of disputed items at a time. Bison’s balance sheet improved by a factor of millions of dollars in the process. The change was so dramatic that one auditor asked if the volume of Walmart freight had suddenly dropped for some reason. It hadn’t. The rollouts with other fleets began in October and were completed in early September 2020. “We onboarded carriers in a matter of 72 hours for a straightforward user,” says Pete Gowanlock, vice-president – freight at DLT Labs. DL Freight can support transactions in everything from modern transportation management systems to legacy mainframes. Even the most unusual transportation challenges can now be addressed. Lalonde refers to the “whale surcharge” that applies when container vessels have to slow down off the coast of Newfoundland to protect the mammals. Those situations are now all accounted for by adding a single piece of information to the blockchain. It all contributes to a stronger working relationship between shipper and carrier alike. Walmart Canada’s return on investment is measured in millions of dollars, Loudon Owen, CEO of DLT Labs, says. “At the same time, the carriers are also experiencing material savings in time and money, coupled with faster payments.” He continues to be surprised that blockchain solutions haven’t been more widely adopted, given the leap in value that can be realized. “We see all the shipment information together in one ledger that originally was a payment platform, but we are using it much more as an information platform to give us insight on how we run our business,” says John Bayliss, Walmart Canada’s senior vice-president – logistics and supply chain. INSIDE Logistics OCT OB E R 2020

by Steve Bouchard, Transport Routier

| SU PPLY C H A I N S C A N

CN to use 50 electric trucks Lion Electric vehicles will be tested throughout CN operations CN WILL BE buying 50 new electric trucks from Lion Electric to add to its intermodal fleet. In April 2019, CN launched a pilot program to test custombuilt electric trucks engineered by the Quebec-based manufacturer. These zero-emission trucks, slated for intermodal use, will be tested in a variety of situations and environments across the CN network, from urban delivery, to container shuttle service, and port operations. “We are striving to reduce our carbon emissions by 29 percent by 2030 from 2015 levels. Innovation and new technologies play a very important role in achieving this kind of goal,” CN president and CEO Jean-Jacques Ruest said during a media event. The first of the 50 trucks will be delivered in just over a year and will be based in locations including Montreal, Toronto and Vancouver, said Yves Provencher, senior director of business development for Lion. Some could also be based in Chicago. Lion will work with CN to determine the best applications

insidelogistics.ca

for the trucks, too. “This will dictate, for example, how many batteries will be required. If, for example, trucks travel short distances but carry very heavy loads, few batteries will be installed, while if they travel long distances but with light loads, more batteries can be installed. That’s a bit of what remains to be determined,” Provencher said. The Lion Electric Co. designs and manufactures all-electric class 5 to class 8 commercial urban trucks, and all-electric buses and minibuses for the school, paratransit, and mass transit markets. The trucks are also engineered to withstand North American road and weather conditions. Earlier this year the SAQ, Quebec’s alcohol retailer, announced it was buying the first Lion Electric class 8 straight truck.

SU PPLY C H A I N S C A N |

By Emily Atkins

Automation key to post pandemic e-commerce success IN THE WAKE OF Covid-19 pandemic

lockdowns, e-commerce demand has skyrocketed, prompting retailers to look closely at warehouse and distribution centre automation as a means of keeping up with demand. “Demand has spiked to the point

where some of our customers are saying every day is like Black Friday,” said Nick Klein, Bastian Solutions’ sales director for Canada. Even purpose-built omnichannel operations have not been able to keep up in some cases, he noted. Klein was speaking in a Bastian Solu-

DAILY

DIRECT SERVICE ONTARIO • QUEBEC • BRITISH COLUMBIA • ALBERTA

ALABAMA • GEORGIA • KENTUCKY • TENNESSEE

tions webinar, “Addressing pandemic pressures in supply chain automation”. Increasing numbers of customers are investigating their automation options, Klein noted. “Nobody knows what the new normal will be for buying behaviour, however the assumption is there is a growing comfort with e-commerce” as people who have never bought online suddenly discovered they could get their necessities without leaving the safety of their homes. The immediate effect of the pandemic was a surge in demand for staff at the same time that people really didn’t want to go to work. Now, with physical distancing rules in most e-commerce fulfillment operations, there just isn’t enough room for employees to keep two metres apart while picking orders, creating new demand for automation, Klein added. Another effect of the pandemic has been concern about ensuring inventory is where it needs to be. Online-only SKUs now also need to be stocked in the store for buy online pick-up in store (BOPIS) orders, companies are considering more local manufacturing with shorter supply chains, and there will be an increase in returns that comes with more e-commerce. Klein noted that with the pandemic in its fifth month in North America, it would be difficult to pinpoint automation solutions that had been implemented as a result, but the interest in micro-fulfillment has amplified, and last-mile delivery is now an even hotter topic than it was. Adapting to these challenges will requires flexibility and immediate action. “Even though the landscape is rapidly developing, the status quo until all this settles may be a risky tactic,” Klein said. Instead companies should evaluate their current position and identify options to consider, then stress-test those options using various new-normal scenarios. He pointed out that with the number of automation options available on the market it is relatively easy to find a modular and scalable solution that will allow for expansion as demand increases. INSIDE Logistics OCT OB E R 2020

| SU PPLY C H A I N S C A N

Seaports need to raise their game Rising water and growing demand spark development need SEAPORT FOOTPRINTS will need to

expand by up to 3,689 square kilometers (1,424 square miles) worldwide in the next three decades to cope with the combination rising sea levels and booming demand, according to a new study published in Earth’s Future, a peer-reviewed scientific journal focusing on climate change and future sustainability. The new study, “Demand for Ports to 2050: Climate Policy, Growing Trade and the Impacts of Sea‐Level Rise” was written by Susan Hanson of the School of Engineering, University of Southampton, UK and Robert Nicholls from Tyndall Centre for Climate Change Research, UEA, Norwich, UK. It modelled trade growth and port demand through 2050 under four combinations of climate policy interventions and global temperature increases. All scenarios lead to increased traffic through ports, requiring the doubling or even quadrupling of port areas. The cost of building new port capacity to meet demand for freight traffic will dwarf sea level rise adaptation costs, according to the new study by AGU, a global organization supporting 130,000 Earth and space science enthusiasts and experts. The scenario with minimal greenhouse gas restrictions produced the highest cost projections, US$750 billion, generated mostly from port expansion to meet rising demand. Previous studies of the economic impacts of climate change on ports have focused on the costs of adapting existing port facilities to rising sea levels and stronger, more frequent storms. But demand for port services will also continue to rise, according to UN maritime trade and industry projections. Policies designed to limit the global temperature rise to two degrees Celsius by the end of century are expected to slow trade growth overall, according to the new study. Distribution of traded goods is also expected to shift with increases in bioenergy commodities and decreasing demand for fossil fuels. Energy commodities currently account

insidelogistics.ca

for about 40 percent of seaborne trade. Ships transport 80 percent of trade goods worldwide. Ports have been expanding since the 1980s to meet increasing growth in the sector driven by trade liberalization, opening of China’s economy, and in-

creased containerization. Incorporating adaptation strategies into new construction is a relatively low-cost means to prevent future disruption from the effects of climate change, according to the study’s authors.

A SUCCESSFUL FUTURE STARTS

TODAY THERE’S NO BETTER TIME T H A N N O W T O E VA L U AT E Y O U R O P E R AT I O N S , I N C R E A S E E F F I C I E N C Y A N D P R E PA R E F O R

T H E F U T U R E . F R O M O P E R AT I O N A L A N D S L O T T I N G A N A LY S I S T O S U P P LY C H A I N N E T W O R K A N D WA R E H O U S E D E S I G N , S U S TA I N A B I L I T Y S T U D I E S T O FA C I L I T Y M A S T E R P L A N S — OUR EXPERIENCED, UNBIASED T E A M O F C O N S U LTA N T S A R E H E R E T O H E L P. PROUD TO BE YOUR TRUSTED S U P P LY C H A I N A D V I S O R S .

L E A R N M O R E AT: BASTIANSOLUTIONS.COM/CONSULTING

SU PPLY C H A I N S C A N

MOVERS + SHAKERS Rebecca McKillican is the new CEO of McKesson Canada. McKillican succeeds Domenic Pilla, who announced his plans to retire from the company in late 2019. McKillican leads McKesson’s businesses in Canada. She joined McKesson three years ago with the acquisition of Well.ca. Her background also includes senior roles at New York City-based Kohlberg, Kravis & Roberts (KKR), and McKinsey & Company. McKillican earned her MBA at the Harvard Business School, and also holds an HBA, and a B.ESc in software engineering from Western University. In 2018, she was named one of Canada’s Top 40 Under 40.

John Salt and David White are being inducted as the 2020 Supply Chain Canada Fellows, and will now carry the designation as a Fellow Supply Chain Management Professional (FSCMP). Fellowships are

awarded annually to individuals for conspicuous service to the industry, profession, and community at large. John Salt is the senior vice-president of supply chain at Canadian Tire Corporation (CTC). Since taking on this role in 2009, Salt has been instrumental in upgrading the systems that support the operations of CTC’s logistics and transportation functions. He also oversaw the construction of the company’s new Bolton Distribution Centre, the largest LEED building of its kind in North America. David White is the executive vice-president of supply management at bus manufacturer NFI Group Inc. (NFI). In 2002, White moved from finance to a newly created executive position and led a multi-year transformation of the company’s supply chain.

Former Canadian Pacific Railway Limited executive and board member William R. (Bill) Fatt has died. Fatt joined the CP board in September 2016. He served as chairman of the finance committee and a member of the audit committee before resigning for health

reasons in November 2017. Earlier in his career, he served as CP’s CFO before taking the helm of Canadian Pacific Hotels and eventually moving the company’s properties to the Fairmont Hotels & Resorts banner.

Ed Harris has retired from his position as executive vice-president at CSX Corp. Jim Foote, president and CEO said: “On behalf of the board of directors and everyone at CSX, I want to thank Ed for his tremendous contributions to this company. When I was entrusted to lead CSX in December 2017, the first phone call I made was to Ed Harris, because I knew that there was no better railroader to help with the transformation of CSX and guide the continued implementation of our operating model… We extend to Ed our utmost gratitude and respect, and wish him all the best in retirement.” CSX’s safety and facilities groups that had reported to Harris will report to Jamie Boychuk, executive vice-president operations, who was appointed in October 2019 to succeed Harris in operations.

π SHIPPING SUPPLY SPECIALISTS

ORDER BY 6 PM FOR SAME DAY SHIPPING

COMPLETE CATALOG 10

1-800-295-5510

uline.ca INSIDE Logistics OCT OB E R 2020

| SU PPLY C H A I N S C A N

Canada’s biggest ship THE LARGEST containerized cargo vessel to call at a Canadian port arrived at the Port of Halifax in September. The CMA CGM Brazil, 366 metres long, 51 metres wide and with a 15,072-TEU capacity, berthed at PSA Halifax. The CMA CGM Brazil sails on the weekly Columbus JAX service, from South Asia to the East Coast of America. With a terminal area of 32 hectares, a quay length of 1,045 metres and a depth of 16.5 metres, PSA Halifax is the only port in Eastern Canada that can accommodate ultra-class vessels. This inaugural call of the CMA CGM Brazil comes shortly after the arrival of Eastern Canada’s largest ship-to-shore super post-Panamax crane in July 2020, bringing the total number of SPPX cranes at PSA Halifax to five. The Halifax Port Authority is in the final stage of completion of a deep-water berth extension which will bring the total quay length to 800 metres to meet the growing deployment of Ultra Class Container Vessels. “It is a great honour to welcome CMA CGM Brazil, the largest container ship of all-time at any Canadian port. The arrival of this ship soon after the delivery of our newest and largest crane demonstrates the benefits of our stepwise development of PSA Halifax,” said Kim Holtermand, CEO and managing director at PSA Halifax. “With the support of our committed workforce and staff, the Halifax Port Authority, CN, and our broad customer base and stakeholders, the call is testament of PSA Halifax’s ambition, opportunity and the great resolve within this port to be alongside creating lasting and sustainable growth.” The CMA CGM Group made more than 450 calls and brought approximately 500,000 TEUs to Canadian ports in 2019. “At CMA CGM, we are very pleased to be part of this momentous occasion,” said CMA CGM Canada general manager Thiago Campos.

insidelogistics.ca

PARTNERSHIP, PROFICIENCY & PROCESSES

We provide customers supply chain expertise, superior process execution, responsive customer service, real time visibility, and ongoing process improvements at competitive rates.

BEHIND EVERY SUCCESSFUL COMPANY IS A STRONG SUPPLY CHAIN LINK.

TRANSPORTATION, WAREHOUSING, BUSINESS INTELLIGENCE.

MAKE 3PL YOUR STRATEGIC LINK 1 (877) 660-3362

3PLLINKS.COM

SU PPLY C H A I N S C A N |

Amazon building new DCs in Ontario

Complexity stymies supply chain pros

AMAZON HAS announced its intention to open two new

AS SUPPLY CHAINS become more complex, the professionals that manage them are having trouble keeping up. According to a new survey, more than 90 percent of supply chain managers who responded said they are having trouble staying ahead of the challenges complexity introduces. Supply chain technology provider Körber polled 1,200 global supply chain professionals to learn how they cope with supply chain complexity and how they’re managing the transition from manual to automated processes. More products, distribution channels, and customer expectations make sup-

fulfillment centres in Hamilton and Ajax, Ontario. The new fulfillment centres are expected to open in 2021, bringing the e-commerce behemoth’s total to 10 fulfillment centres in Ontario and 16 across Canada. At the new 855,000 square-foot fulfillment centre in Hamilton, more than 1,500 employees will work with robotics to pick, pack and ship small items like books, electronics and toys. In Ajax, more than 1,000 employees will pack and ship large items such as sports equipment, patio furniture, fishing rods, pet food, kayaks, bicycles and other household goods. This DC will be one million square feet in size. The company says the new facilities are expected to create 2,500 new jobs. It has also recently added five new nearby delivery stations in Stoney Creek, Kitchener, Vaughan, Etobicoke and Scarborough, Ontario. The Etobicoke site has already launched, and the Kitchener site will launch later this year. The Stoney Creek, Scarborough and Vaughan sites will launch in 2021.

ply chains more complex. Technology integration and customer demand ranked among the top challenges today’s supply chain faces. Respondents cited the following as the issues that compound supply chain complexity: 48 percent cited integrating and ensuring software, materials handling equipment (MHE), and technologies work together throughout the entire logistics ecosystem; 46 percent said integrating functions across the supply chain – from manufacturing to end-customer deliveries; 46 percent noted meeting expectations for speed, cost and adaptability.

Introducing the new FIATA Diploma Course – Advanced Freight Services Register and Gain Global Recognition ciffa.com/FIATADiploma

Save 10%* use promo code Inside10

*For CIFFA Non-Members Only

INSIDE Logistics OCT OB E R 2020

Christian Sivière

| SU PPLY C H A I N S C A N

The Montreal Port strike Who pays the freight for diverted cargo? More businesses are paying attention to these supply chain headaches. Nearly three-quarters of survey respondents said senior executives view the supply chain as mission-critical – an important step in gaining support for upgrading warehouses and last mile technology. “Now isn’t the time for supply chains to break under pressure – yet, 48 percent of companies have experienced growth in complexity this past year,” said Rene Hermes, chief marketing officer for Körber Supply Chain. “It’s good to hear so many executives see this business area as mission-critical. Now we must transform that understanding into action.”

IN CASE YOU MISSED IT what’s happening at

insidelogistics.ca » » » » »

Ontario and Brampton at odds over 400 highway https://tinyurl.com/ IL-brampton Trends in last mile delivery https://tinyurl.com/ IL-Finalmile IATA calls for vaccine preparations http://tinyurl.com/IL-vaccine Vancouver posts grain record https://tinyurl.com/IL-Grain New electric delivery van https://tinyurl.com/IL-EVan

insidelogistics.ca

FORTUNATELY, the August 2020 strike at

the port of Montréal only lasted 12 days. But it was long enough to create frustration, delays and extra costs for customers. In a port strike situation, carriers have two alternatives: wait at anchor for the strike to end, or divert their vessel to an alternate port, discharge the cargo and continue the voyage. The latter option is most often used, and in this case several vessels were diverted to East Coast ports. Carriers then usually make arrangements to forward the cargo to the original port of destination, when it is practical to do so. And one of the advantages of containerization is it’s much easier to move containers than breakbulk cargo. The question then is: who pays for the extra costs? One might assume the carrier would, since it signed a Bill of Lading for carriage to Montréal. However, this is when carriers remind us of important clauses found on the back of their Bills of Lading, appropriately called the “fine print”: “Methods and Routes of Carriage” and “Matters Adversely Affecting Performance”. These clauses exonerate the ocean carrier from additional costs incurred in strike situations. So your carrier will make the necessary arrangements to forward your Montréal-bound containers from Halifax, but at your expense, not at their expense. The next question: Is “your expense” the exporter’s or the importer’s? The answer to this lies with the Incoterm used in the con-

tract between exporter and importer. The Incoterms rules define the divisions of obligations, costs and risks between the parties. While the obligations and costs aspects are logical, the “risks” element is often misunderstood. Seven Incoterms are pretty straightforward, as the shifting of costs and risks match. CFR (Cost and Freight), CIF (Cost, Insurance and Freight), CPT (Carriage Paid To) and CIP (Carriage and Insurance Paid To). Who will have to pay the additional costs from the East Coast diversion ports to the port of Montréal? It is the importer in the case of EXW (ExWorks), FCA (Free Carrier), FAS (Free Alongside Ship) and FOB (Free On Board) contracts. For DAP (Delivered At Place), DPU (Delivered at Place Unloaded) and DDP (Delivered Duty Paid) contracts, the exporter has to bear the costs. What sometimes surprises importers is that under CFR, CIF, CPT and CIP contracts, they have to pay the additional costs, as the shifting of risks occurs at time of loading on board the vessel at the port of departure (CFR & CIF) or when the goods are handed over to the first carrier in the country of dispatch (CPT & CIP). That’s been the rule since 1936 and it’s still valid today. If you are surprised, it’s time to take a refresher training on Incoterms. It’s a current topic: the last update, the 2020 version, has only been in effect since January 1st this year.

Flying-V prototype takes to the air in maiden ﬂight A SCALE MODEL of the Flying-V has flown for the first time. A year and a half ago the Delft University of Technology (TU Delft) and KLM announced the start of the design of the Flying-V aircraft, which is being designed to reduce fuel consumption by 20 percent over conventional aircraft. The plane is a long-haul aircraft where the passenger cabin, the cargo hold and the fuel are all located in the wing. “We’ve designed an

oval pressurized cabin that allows for an efficient structural design, with sufficient design freedom to allow for proper aerodynamic shaping,” said Dr. Roelof Vos, researcher in flight performance and propulsion at TU Delft and project leader of the Flying-V. The developers estimate that the Flying-V consumes 20 percent less fuel than an Airbus A350 for the same flight. Airbus is a partner in the project.

COV E R S T O R Y

| By Emily Atkins

MAKING KAYAKS

FASTER D

oom and gloom had settled in like a bad spring storm at ClearWater Design. It was March 24 and the owners, husband and wife team Michelle Laframboise and Ian Crerar, had just decided to lay off their staff and shut down production at their Prince Edward County, Ontario-based factory. Normally, the January through May period is their busiest, with production of

rotationally moulded canoes, kayaks and stand-up paddleboards running full tilt, propelled by sales at several major consumer trade shows. The company normally pre-sells about 300 boats (of its normal annual sales of 2,500 units) over the course of those shows. But this year the Covid-19 pandemic shut down these opportunities, starting with the Home Show in Toronto, which was to

Normally, by September these racks would be replenished in preparation for the next winter’s trade show sales season. Inset: Michelle Laframboise and Ian Crerar of ClearWater Design had their best year ever in 2020. Photo: © Daniel Vaughan (Vaughangroup.ca)

INSIDE Logistics OCT OB E R 2020

Image:Emily Atkins

How ClearWater Design dug deep to ride the wave of pandemic-fuelled demand

run from March 13 to 22. The booth was already set up and the sales team on the way there when they got the news that the City of Toronto had shuttered the event. “I really wasn’t expecting great things from this year and the [pre-pandemic] shows were soft,” said Laframboise, the company’s CEO, and person responsible for procurement, logistics and production planning. And when the pandemic shut everything down, “we thought our season was done at that point. Basically we thought we’d be resetting for 2021. Because it’s our 25th year, we’re well established enough that we could weather this storm. So we knew – even if we didn’t sell anything more that season – that it would not be the end of us.” But you don’t get to be a 25-year, family-owned manufacturer by being complacent. Laframboise and Crerar wasted no time figuring out how to salvage the year, following up any lead at all that might result in a sale. “Basically it was just Ian and myself, since our staff was all gone, trying to follow up any possible lead and doing anything we could for any sale – driving anywhere to deliver anybody a boat for anything. One here, one there,” Laframboise recounts.

A glimmer of hope But, suddenly, at the beginning of May they received a call from their Quebec distributor, Allan Gourdji of outdoor retailer Yanes Canada, based in Montreal, with an order for 100 special-order kayaks for, improbably, a Corona beer promo-

tion. They called the staff back in to make these boats. Around the same time, Quebec announced it would begin re-opening some businesses. Gourdji decided the time was right and ordered his first regular load of boats immediately afterwards. At first, production was normal, and then the orders started pouring in, all from Quebec. Yanes was swamped with customers looking to buy equipment for safe, outdoor activities. Normally, Laframboise says, an order for Yanes would be 50 boats, which ClearWater would load and ship itself, using its fleet of pickup trucks equipped with custom-built racking and towing enclosed trailers. But Gourdji was now ordering 100 boats at a time, necessitating a tractor-trailer load, and the orders kept piling on. In late May, the company opened its Muskoka and Kingston retail stores and the factory outlet for curbside pickup, as Ontario began to feel the resurgence of retail confidence.

The surge It quickly became apparent that normal production was not going to keep pace with the orders piling up on Laframboise’s desk. In an average year orders need to be fulfilled by mid-July; if production runs late orders get cancelled. Typically the company produces 30 boats a day Monday through Thursday, with Friday as a catch-up day. The various types of kayaks, canoes and boards are made

The company’s main ‘cooker’, Ray Gellert-Leduc, about to start baking a new paddleboard.

from polyethylene pellets, mixed and ‘cooked’ in a mould, then cooled and finished by a team who cut out holes for cockpits and hatches, and add seats, webbing, rudders and hardware, and then package each boat in a protective wrap for transport. This process cannot be rushed – just as with any baked good you can’t take it out of the oven too soon without consequences. So with the expectation that the surge in orders would dry up in late July, they added four new staff to the six they already employed on the manufacturing side, and added another boat-cooking shift. “We were starting at midnight through until about five o’clock in the afternoon,” Laframboise says. “We went from doing four days, 30 boats a day, to five days at about 45 to 50 boats a day. Plus Saturdays; we would do 20 boats on Saturdays.” As of September 1, they had still not caught up with orders, and dealers were not cancelling, even this late in the paddling season. Laframboise said they still needed two more weeks of high production to catch up, and then another couple weeks to get some stock in the warehouse.

Playing catchup ClearWater Design normally takes a break from making boats in the late summer and early fall, switching over to making the next year’s supply of injection moulded parts like rudders, deck buttons and foot stops, as well as paddles. Likewise, in the fall they order a year’s supply of small continued on page 16

COV I D -19 PA N D E M I C

continued from page 15

Fortunately, the supplies of polyethylene plastic that ClearWater Design relies on were not significantly disrupted due to the pandemic.

components from three principal overseas suppliers. These typically are on a 12-week cycle from order to arrival at the factory. When production ramped up suddenly these supplies were running short. “You just run out of everything so quickly when you’ve doubled production,” Laframboise says.”Every single last bit and piece and box of anything was gone. We sold every single paddle we produced, every single foot stop, every single life jacket that we brought in. So then I’m also scrambling to find other suppliers domestically because they’re the ones who have the capacity – like we do – to keep making things.” A polyethylene supplier couldn’t deliver because they weren’t able to produce enough thanks to Covid distancing restrictions. Fortunately another supplier was able to fill the gap. On the flip side, however, because some suppliers were less busy than normal, Laframboise’s emergency orders for items like the graphics they put on the boats and gaskets, which

“This year, every single boat in our warehouse was gone. All of my dealers kept saying they could have sold twice as much if I could have provided them more.” were normally on a 12-week turnaround showed up in a week. Still, the unpredictability has been a challenge, she says. “I’m waiting on things that I’ve had to air freight from overseas. We’ve also had to basically search every corner of the warehouse for bits that were left over from previous trade shows, previous production runs. It meant a shift to use similar hardware, but that we had stopped using, but we still have a box of it.” In fact, a recent order for seats and paddleboard pads was still pending, forc-

ing the factory to leave a stack of partially finished boats and boards aside until it arrived so as to not disrupt production.

A moving target Transportation has also been a moving target, both inbound and out. There have been 6 am runs to the UPS depot to intercept boxes before they were loaded on the delivery truck, and one notable airfreight order from China was sent to Vancouver rather than Toronto, necessitating another flight and a trip to the airport to get it, while another order sat in a Brockville, Ontario, depot for a couple days before finally being delivered. The cost does not faze Laframboise: “I am biting the bullet and paying thousands of dollars more than I would, but I really don’t have a choice. So I just look at it as, if I don’t do that and pay an extra, say, $4,000 for these components – that’s maybe five or 10 boats sold – it’s going to cost me to get that as opposed to being shut down.” On the outbound side, Yanes, in INSIDE Logistics OCT O B E R 2020

Finished boats ready for loading onto a trailer.

Best year ever

Montreal, has ended up taking 1,300 boats this year, requiring one or two tractor-trailer loads of 80 to 100 boats a week. Laframboise previously used a freight broker for infrequent large loads, but this year has dealt exclusively with Day & Ross, which she says has been reliable and offers really good customer service through a dedicated rep.

Avoiding burnout With the extra shift and long days in the office, the whole ClearWater Design team was pushing hard to meet demand. “If we had gone around the clock, 24 hours a day, I could probably have sold everything we could have produced,” Laframboise says. “But we were all getting burnt out already. And even pushing for the occasional Saturday, I was very cautious about that because I know that I was in the office 12 hours a day, not on weekends – well, a few weekends – but so I know how burnt out I felt, and I really didn’t want to jeopardize destroying my staff.”

insidelogistics.ca

The shop floor with canoes in line for finishing; the rotational moulding machines are in the background.

The beauty of a seasonal business, even when it gets pushed by a couple months because of a pandemic, is that you do get a break – eventually. “We can all tolerate this because we know it’s not going to last that long,” she adds. The company also helped to keep its staff by giving them all raises and bonuses, avoiding the dropouts that others experienced with the availability of Covid-19 government benefits.

Thanks to the tireless work of all the staff, ClearWater Design will see its best year ever in 2020. “This year, every single boat in our warehouse was gone. All of my dealers kept saying they could have sold twice as much if I could have provided them more,” Laframboise says. By contrast, last year they shut down production in midJuly with 800 boats in the warehouse. After the soft beginning to the year, she said they were wondering if perhaps kayaking had passed its peak. And when the boom hit, they were reminded “that a good thing about our company is the fact that we are small, that we are flexible, that we have the ability to ramp things up and almost double production from one day to the next.” Selling a ‘Made in Canada’ product and being readily available were huge advantages as people flocked to outdoor activities. “We’re very happy that we’re one of the companies who actually came out ahead this year,” Laframboise concludes.

THE NEXT NORMAL

| By Emily Atkins

WELCOME TO THE NEXT

NORMAL Digitization and automation Before the pandemic struck, digitization and automation were already hot topics in SCM. But as the effects of the pandemic shutdowns and uncertainty compounded with soaring demand for online shopping, it became clear that automated and digital processes were becoming necessities, not nice-to-haves. “Automation will be even more embedded in companies’ operations as we emerge from the pandemic,” says Scott Ashbaugh, vice-president of operations,

DHL eCommerce Solutions. “Digitization is the key to becoming more effective and efficient and to creating growth opportunities – especially facing a new ‘normal’.” DHL e-commerce Solutions saw demand soar, accelerating its automation plans. “With Covid-19, the surge in e-commerce volume put our equipment to the test, with us currently processing volumes we expected we would see in five years. This acceleration has sped up our plans to further automate our network,” says Ashbaugh. The pressure to enforce physical distance in the fulfillment centre is exacerbating an already tight labour market, noted Sedlak vice-president Louis Cerny. “Anywhere you see people fulfilling an order is going to be a target for automation going forward,” he said. “It will enable people to work in a safe environment and not worry about interactions.” Practically, he believes this will be the implementation of more goods-to-person robotic technologies, using autonomous mobile robots similar to the ones Amazon deploys. “This pandemic hit everybody like a ton of bricks,” says Jason Haelzle, principal

and vice-president of the agriculture and food team at global consulting firm GHD. “Flexibility is going to be the driver, long term, and in order to get that flexibility, you need visibility. Some businesses are going to AI and digital models that enable them to see what’s happening with real time data.” Where before the pandemic it was it was still possible to “somewhat predictably” manage with data a month after the fact or even quarterly, he says, companies “based on that older model certainly suffered more than those that were more flexible.”

Retail Retailers are facing some remarkably volatile conditions thanks to the pandemic. While already-suffering bricks and mortar stores were forced to shut down, e-commerce exploded as people were made to remain at home. This is forcing a rapid expansion of e-commerce capabilities for many, even those already well entrenched in omni-channel commerce. The reduction in order-to-delivery times and increase in SKUs being sold online “increased the complexity of fulfillment activities and made effective forecasting – fed by consumer data and insights – an even bigger priority in inventory management,” said DHL Supply Chain’s president of eCommerce for North America, Kraig Foreman. “With Covid-19 throwing buying behaviors and with that, retailers’ ability to forecast, into disarray, our customers INSIDE Logistics OCT OB E R 2020

Image: iStock images

s the global Covid-19 pandemic stretches into its eighth month, the frantic panic-and-pivot activity of its initial phases is evolving into a novel normalcy. Supply networks – stretched to their limits – either broke or rebounded into a new form. For some, it was unprecedented demand that forced a change. For others it was a complete collapse of one market that prompted a pivot into a new one. In either case, however, we are now seeing the creation of the next normal – the new pathways and accommodations to adjust to the continuing demands of the pandemic-tinged world. While the changes are widespread and creeping into just about every corner of business, the main impacts on supply chain operations are seen in digitization and automation, changes to network design, health and safety measures and in retail – specifically e-commerce – fulﬁllment.

How the pandemic is prompting enduring change in supply chain operations

have realized that data is still important, but it also needs to be supplemented by lean, efficient operating platforms that are responsive to sudden changes in demand.” To that end, retailers are trying to find ways to use the existing technology and facilities they have to better meet the changing needs of the marketplace. It’s not just fulfilling e-commerce orders, either, Cerny said. There will be people who want to shop in a physical store, which is turning into a different kind of space, with a small storefront backed by a larger storeroom that’s fulfilling all kinds of orders. While the microfulfillment trend had legs prior to the pandemic, it is being propelled by the need for faster local delivery. “If you are a retailer not thinking six months or two years down the road you might not be around,” he cautioned.

Supply chain design When vast segments of the world’s manufacturing shut down during the initial stages of the pandemic, supply chain operations were caught short. A cascade of unfilled orders and stockouts on retail shelves were a shock to systems that rely on just-in-time fulfillment. continued on page 22

insidelogistics.ca

PRODUCTIVITY, PAUSED Businesses estimate a year before return to normal Almost half of businesses (46 percent) believe it will take 12 months or more before supply chains return to pre-pandemic levels of performance. A poll by the U.K.-based Chartered Institute of Procurement & Supply (CIPS) has found that the disruption caused by Covid-19 will lead to permanent changes in global supply chains, as businesses look to adapt to new ways of working and managing the varying stages of lockdown around the world. The survey was conducted this summer among global supply chain managers who were asked about the effects of lockdown and the pandemic on their businesses and in their region. Respondents to the survey said that supply chains were being remapped and redeveloped in reaction to new regulations as well as permanent and temporary lockdowns as countries navigated the waves of the pandemic. In fact, 62 percent of global supply chain managers said they will seek new or alternative suppliers in order to rebuild their supply chains in the wake of the Covid-19 disruption. These actions could cause a significant impact on global trade, with 31 percent also stating that they will reshore their operations to limit further international disruption and find new suppliers. The impact has also affected prices. Two thirds (67 percent) of global businesses reported having to pay more for goods and services as a result of the disruption, costs that may be pushed to consumers in the coming months. CIPS asked about initiatives that may fall by the wayside as supply chain managers try to protect their businesses in response to shifts in trade and other economic impacts. Fifteen percent of businesses said they will no longer maintain their plans for sustainable supply chains due to the impact of Covid-19.

Nothing says Professional Logistics Expert like CCLP. CITT is proud to SUHVHQW WKH &,77 &HUWLÂ¿HG /RJLVWLFV 3URIHVVLRQDOV ZKR HDUQHG WKHLU CCLP designation EHWZHHQ -XQH -XO\ &RQJUDWXODWLRQV WR WKH PRUH WKDQ GHGLFDWHG VXSSO\ FKDLQ ORJLVWLFV SURIHVVLRQDOV ZKR QRZ MRLQ WKH UDQNV RI WKH LQGXVWU\Â¶V HOLWH

$GHELVL $GHÃ€R\H &&/3 Oshawa, ON

Olusola Adeleye, CCLP Calgary, AB

Dawinder Babbar, CCLP Edmonton, AB

Ramiro Ballesteros Vazquez, CCLP Toronto, ON

Sam Batarseh, CCLP Prince George, BC

Diana Belanger, CCLP Oakville, ON

Mathew Branco, CCLP Bolton, ON

Maria Luisa Cabanne, CCLP St. Laurent, QC

Vince Concepcion, CCLP Toronto, ON

Moruf-deen Farayola, CCLP North York, ON

Peter Goumans, CCLP Calgary, AB

Prashant Gupta, CCLP Saskatoon, SK

Thomas Haddad, CCLP Lincoln, NB

Pamela Humphries, CCLP St. Johnâ€™s, NL

Shaikh Hussain, CCLP Pickering, ON

$GHZDOH ,VDÃ€DGH &&/3 Winnipeg, MB

Philippe Jolicoeur, CCLP Winnipeg, MB

James Joshua, CCLP Oakville, ON

Goran Koprivica, CCLP Toronto, ON

Oksana Kovalchuk, CCLP Dieppe, NB

Peter Landa, CCLP Uxbridge, ON

Chuck LeBlanc, CCLP Lethbridge, AB

Nathan Miller, CCLP Toronto, ON

Jennifer Mlodzinski Winnipeg, MB

Brandy Nuis, CCLP Cambridge, ON

Stephen Kay, CCLP Shelburne, ON

Adegbenga Koko, CCLP Windsor, ON

Patrick Lo, CCLP Richmond, BC

Mike Matthews, CCLP Toronto, ON

Hakim Merad, CCLP Montreal, QC

José Oliveira Junior, CCLP Toronto, ON

Amitkumar Patel, CCLP Brampton, ON

Khan Muhammad Saleheen, CCLP Scarborough, ON

Sanjay Sharma, CCLP Mississauga, ON

Matthew Ting, CCLP Calgary, AB

William Trent, CCLP Milton, ON

Mushtahir Rahman, CCLP Toronto, ON

Yatin Rattan, CCLP Mississauga, ON

Dmitriy Reznik, CCLP Toronto, ON

Pavel Shcherbin, CCLP Markham, ON

Sagar Shrestha, CCLP North York, ON

Manvir Singh, CCLP York, ON

Julie St. Jacques, CCLP Dugald, MB

Tushar Udernani, CCLP Mississauga, ON

Lisa Vegso, CCLP Burlington, ON

Arturo Villegas Zarceño, CCLP Mississauga, ON

Alfredo Wong Lau, CCLP Richmond, BC

Brett Polanik, CCLP Saskatoon, SK

Photos of these 2020 &,77 &HUWLÀHG /RJLVWLFV 3URIHVVLRQDOV were not available: Iman Aliasgari, CCLP, Brampton, ON Corey Arseneault, CCLP, Aldergrove, BC Ian Barrett, CCLP, Ottawa, ON Jeff Bender, CCLP, Calgary, AB William Bishop, CCLP, Mississauga, ON Sam Boehm, CCLP, Hamilton, ON Lennox Bradshaw, CCLP, Scarborough, ON James Brassard, CCLP, Brampton, ON Shelly Brearley, CCLP, Thamesford, ON Chris Brinkman, CCLP, Saskatoon, SK Dino Capuani, CCLP, Nobleton, ON Joe Chaaya, CCLP, Brampton, ON Maria Cruz Luque, CCLP, North York, ON Brian Dang, CCLP, Toronto, ON Elena Daniltchenko, CCLP, Pierrefonds, QC Vitalii Filonenko, CCLP, Toronto, ON Yihua Gan, CCLP, Mississauga, ON Grant Goodall, CCLP, Nanaimo, BC Joel Harris, CCLP, Georgetown, ON Anja Hecher, CCLP, New Westminster, BC David Holleman, CCLP, Mission, BC Ramandeep Kaur, CCLP, Caledon, ON Louise Kedves, CCLP, London, ON Asif Khanbhai, CCLP, Mississauga, ON Nishad Kulkarni, CCLP, Mississauga, ON Ryan Langley, CCLP, Surrey, BC Eric Lizotte, CCLP, Saint-Hubert, QC Nick Mastrofrancesco, CCLP, Orangeville, ON

Andy Mauko, CCLP, Caledon, ON Shawn Mitchell, CCLP, Burlington, ON Sumit Narang, CCLP, Calgary, AB Grant Nicholson, CCLP, Morden, MB Onyekwere Nwagwu, CCLP, Toronto, ON Nataliia Ohorodnyk, CCLP, Etobicoke, ON Viorel Oros, CCLP, Winnipeg, MB Akhil Parachalil Mohan, CCLP, Whitehorse, YT Melissa Parkes, CCLP, Corunna, ON Brett Poe, CCLP, Concord, ON Rizaneth Rivera-Del Fonso, CCLP, Saskatoon, SK David Robin, CCLP, Coquitlam, BC Ivan Romaniuk, CCLP, Toronto, ON Allan Salamanca, CCLP, Toronto, ON Sukhminder Samra, CCLP, Brampton, ON Valeria Santos, CCLP, Toronto, ON Nelson Severino, CCLP, Cambridge, ON Kamatchinathan Shanmugavadivel, CCLP, Binbrook, ON Faheem Sharif, CCLP, Oakville, ON Amit Sharma, CCLP, Scarborough, ON Shraddha Shinde, CCLP, Mississauga, ON Robin Stuart, CCLP, Toronto, ON Min (Mary) Sun, CCLP, Mississauga, ON Baojian Tang, CCLP, Markham, ON Alejandra Tejada Aguilar, CCLP, Thornhill, ON Christa Welles, CCLP, Blacks Harbour, NB Harry Welsh, CCLP, Whitby, ON

See the List of all CCLPs at www.citt.ca/CCLPs Learn how you can become a CCLP at www.citt.ca/cclp

Jie Yan, CCLP Calgary, AB

THE NEXT NORMAL

continued from page 19

This has prompted a long, hard look at how inventory is managed and where inputs are procured. Haelzle suggests that companies will be looking to diversify their sources of supply, both in terms of location and in the number of other organizations they rely on. “Rather than relying solely on China – the low cost model – you’re starting to see people looking at India, Vietnam, Mexico, Eastern European countries. Certainly not going to be as cost effective as China but it’s going to have to greater resiliency longer term,” he says. Haelzle also sees a possible withdrawal from outsourcing arrangements as companies seek to gain better control over their supply chain. Foreman at DHL suggests that business continuity will gain importance. “Operationally, companies are going to approach this in different ways, but at the most basic level, we anticipate that most of our customers will move away from single, centralized distribution centres toward multiple distribution nodes that offer redundancy, flexibility and speed to market,” he said. A perfect example of this can be seen in U.S.-to-Canada cross-border e-commerce. According to Peter Tostevin, vice-president of the healthcare vertical at SCI in Toronto, companies shipping to Canada from the U.S. frequently don’t have warehouse facilities here, and when demand soars they are suddenly scrambling to find space. “They want to localize in the Canadian market for a couple of reasons,” he says. “Their transportation costs have just skyrocketed. They’ve got to shave two, three, four, or five days off their delivery timelines, their in-transit timeline. So we’re seeing a lot of US companies now realizing, ‘we’ve got to set up warehouses in Canada’.”

Safety measures Physical distancing and work-from-home (WFH) regimes have overhauled the way we think about work. As noted above, warehouse automation is one of the most popular ways companies are adapting to Covid-19 distancing protocols. But not every operation can be automated, and for those companies a variety of techniques are being used in addition to basics like PPE and disinfection. (For

“If you are a retailer not thinking six months or two years down the road you might not be around.” – Louis Cerny

an in-depth look at forktruck safety, see “Lifting clean,” below.) Some examples include adding physical barriers between workstations, staggering shifts to reduce the number of employees on site at any one time, and implementing contact tracking and tracing. Beacons and other devices are being introduced to deliver proximity warnings when employees get too close

to each other and at the same time keep track of the contacts made, in case an infection occurs and staff need to quarantine. At DHL eCommerce Solutions, existing monitoring equipment and the security team conducted contact tracing when an infected employee was in one of its buildings. Amazon introduced a system it calls “Distance Assistant” that uses a camera to track staff as they move about the warehouse, and employs an algorithm to create a video overlay – using red or green circles – that shows whether a safe distance is being maintained. The company recently made the software and AI open source so that anybody with a computer and camera can use it for their own operation.

LIFTING CLEAN LIFT TRUCK OPERATIONS UNDER COVID PROTOCOLS

ow does getting back to work in the era of Covid-19 work for lift truck operations? From daily operation to service calls, personnel interact with lift trucks in several ways, all of which can risk virus transmission without proper sanitization. Developing and implementing best practices requires drawing on guidance from the CDC and applying it to the unique nature of your facility, including specific equipment used and its applications.

The right supplies Equipping personnel with sanitization supplies and PPE, including nitrile gloves, hand sanitizer, disinfectant spray, face masks and hand towels helps enable them to adhere to guidelines for cleaning surfaces and limiting the airborne spread of viruses. The Canadian government provides a general framework for cleaning procedures and sanitization products, with EPA-approved disinfectants against Covid-19 and recommended alternatives, including minimum alcohol content for sanitizing solutions. Customizable carrier

By Pat DeSutter

kits can attach to lift trucks, so that operators and technicians have necessary supplies close at hand throughout their shift.

Sanitize effectively Knowing and understanding the hightouch points on lift trucks are essential to effective sanitization. There are three main areas that need attention. First are the high-touch points when entering the reach truck, the seat back, and the frame of the operator console. Second are the high-touch zones inside the compartment. These include the control handle; tiller handle; communication radios, and keyboards; and, the operator interface display and any other touch screens. Third are external areas such as access covers for daily checks; the battery connector and forks and fork pins.

Daily routines Whether a technician visiting for a service call or an operator preparing for a normal shift, all personnel who interact with a lift truck should wipe down and sanitize INSIDE Logistics OCT O B E R 2020

STAY ON TOP OF MAINTENANCE At the onset of the Covid-19 outbreak, many materials handling operations postponed critical maintenance and repairs to limit the risk of outside personnel introducing the virus. But this course of action comes with another set of risks, as equipment failure can stymie productivity and even threaten workplace safety. Managing the risk of virus transmission and taking care of critical repairs and maintenance does not have to be a binary decision. Many leading service organizations have developed their own measures against the virus and are equipped to accommodate site-specific requirements for hygiene and safety. For example, some Yale dealers have separate equipment drop-off and service locations to limit contact between employees, have strict procedures for hygiene and outfit service technicians with PPE and CDC-approved sanitization supplies. Talk to your lift truck maintenance and repair partner about their approach to health and safety, and how they can perform essential service while adhering to site-specific guidelines.

Sanitizing high-touch areas on shared equipment is essential.

the lift truck, work area and any tools before starting work and again once they finish. Consistent application of sanitization procedures is key. To help facilitate regular compliance, the checklist feature on some lift truck telemetry solutions can be customized to add sanitization procedures along with regular OSHA-mandated safety checks that operators must complete at the beginning of each shift. Developed in connection with recommendations from the CDC, Yale’s own pre-shift and end-of-workday lift truck sanitization checklist includes the following: Pre-shift • Wipe down and sanitize the lift truck, work area and tools using approved disinfectant spray, paying special attention to high-touch surfaces entering the truck, inside the operator compartment and others • Put on PPE (gloves, face mask) • Provide plenty of hand sanitizer and hand towels on the truck or at the work station Post-shift • Return the lift truck to the parking area or charging station

insidelogistics.ca

By turning effective practices into new habits, the world can move forward from the Covid-19 pandemic and take a renewed focus on core business.

• Wipe down and sanitize the equipment • Provide a visual display that the lift truck has been sanitized, with a sign, band or other company-approved indication • Remove gloves by turning them inside out and roll one inside the other • Dispose of PPE (gloves, face mask) and cleaning supplies (wipes, paper towels, shop towels) used while cleaning the truck in company-approved disposal bins

vendors for essential tasks like service, preventive maintenance and even stocking sanitization supplies. Consolidation allows operations to more efficiently scale up a variety of services by leveraging a partner already familiar with facility health and hygiene practices. This can limit the redundancy of health briefings and trainings, and reduce the amount of ongoing management and communication to help facilitate compliance.

Vendor consolidation With a virus capable of spreading quickly from person to person, introducing outside personnel can bring potential risk of exposure – even with strict policies in place for social distancing, PPE and sanitization. Government guidelines recommend limiting the number of individuals gathering in a space at one time, tracking visitors and properly equipping them to follow site-specific safety protocols. Of course, the world is moving forward and industries are ready to get back to work. The challenge becomes developing relationships with a limited number of trusted

New habits All industries must make adjustments to keep personnel safe and healthy. Consistency and collaboration are key. For guidelines to combat the virus to be effective, they must be strictly followed at every opportunity by all involved. By turning effective practices into new habits, the world can move forward from the COVID19 pandemic and take a renewed focus on core business. Pat DeSutter is vice-president, fleet service and aftermarket with Yale Materials Handling Corporation

TRUCKING

| By Emily Atkins

Middle-mile

AUTONOMY Trucking start-up tackles niche

lot of effort is being put into developing autonomous trucks all over the world. It’s widely recognized that the technology, once realized, will deliver better fuel economy and help alleviate the driver shortage. But it’s a big challenge to create the technology that will be safe, fully autonomous and able to navigate ever-changing real-world challenges such as weather, traffic, humans and new routes. That’s why Canadian autonomous trucking startup NuPort Robotics is tackling a very specific subset – the middle mile. The Toronto-based company is the brainchild of Raghavender Sahdev, who acts as its president and CEO, and his partner, Bao Xin Chen. They started it up in March 2019, with help from the MaRS innovation centre, and aim to make Canada a centre of excellence for autonomous driving. Sahdev, who is 26, first came to Canada from India as a Mitacs intern at the University of Toronto and then went on to earn his Master’s in Computer Science at York University. Mitacs is a not-for-profit organization that fosters growth and innovation in Canada by promoting research solutions from academic institutions as solutions to business challenges.

Solving for a niche After eight years studying autonomous driving and robotics, Sahdev says they realized the challenges were hard to overcome. To eliminate some of those hurdles they decided to focus on the middle-mile niche. This means routes of one to 25 kilometres, typically between a manufacturing plant and warehouse, or any repeatable, set route. “We wanted to make the problem spe-

which will be offered on a robotics-as-aservice model, retrofitting customer trucks with autonomous features – is third-party logistics suppliers, retailers and automotive manufacturers that do regular shuttle runs between plants and warehouses. A major Canadian retailer is already working with NuPort Robotics to pilot the technology. Sahdev explains that targeting the middle mile means they can focus on achieving Level 4 autonomy, in which the vehicle is fully self-driving, but within a specific set of parameters. “It’s got to work in all weather conditions, and at different times of the day. We know the route prior to deployment of the technology. Those are some of the conditions that need to be met,” he says.

“We’re currently the only company in Canada working on autonomous, self-driving trucks for short distances. We want to establish Canada as the leading country for autonomous vehicles in the world.” – Raghavender Sahdev

cific so that you’re only solving for a given set of repeatable routes – routes that are known prior to deployment of the technology,” Sahdev explains. “Then you can tailor your algorithms to be performing optimally in those regions.” The target market for their product –

Emissions reduction NuPort is focusing on retrofitting class 8 trucks that haul 40- or 53-foot containers, with a payload of around 15,000 kilograms. But Sahdev also notes that they want to work with electric vehicles. “We know that autonomous vehicles already reduce gas consumption,” he says. “Electric trucks make the whole supply chain process much more cost efficient. So we want to actually drive a transition from traditional diesel fuel trucks, towards electric trucks, which reduce carbon emissions significantly.”

Safety Sahdev says they are several years away from being able to deploy the trucks, largely due to the importance of ensuring the vehicles will be completely safe. “For us safety is paramount. So we want to ensure a commercial deployment of a wellINSIDE Logistics OCT OB E R 2020

required on board, there will be new positions at the loading docks, in trailer yards and in ensuring safe operations.

The path ahead

By building a Canadian centre of excellence for autonomous driving NuPort aims to provide jobs for AI specialists.

tested system and that’s going to take us some time,” he says. Right now they are in the data acquisition phase, which they are working on with their retail test partner. Once that is complete they move to off-line evaluation. Simulations are next, followed by testing in controlled environments. Only when the vehicles have been proven safe will they move to public routes. “In an ideal world there should not be any deaths, and autonomous features should prevent the loss of life,” Sahdev adds. While on-the-road testing and the need for a licence is still several years away, the company has been working closely with Ontario’s Ministry of Transportation and other jurisdictions. “We’re also actually blessed and privileged to be situated in Ontario, which is one of the leading jurisdictions globally when it comes to autonomous vehicle technology development,” Sahdev says. He notes that the support of various government organizations has been instrumental in bringing the project this far.

do a lot more than just pilot their vehicle. They are involved with a whole range of other tasks like fuel changes, parking, maintenance, repairs, inspection, communication with dispatchers, and so on.

Multitasking For example, at the loading dock doors a driver typically takes responsibility for the docking and locking process as well as any vehicle inspections. Then a driver is usually also involved in paperwork transfer or logging of loads at the entrance and exit of the yard. Until these processes are completely paperless, a human attendant will be required to ensure that the trucks are loaded safely and properly documented Sahdev notes that making the middle mile autonomous will help alleviate the continuing truck driver shortage, and will also help to create new forms of employment. Once the technology advances far enough that the driver is no longer

Sahdev was recognized in September with the Mitacs Environmental Entrepreneur Award for his work with NuPort Robotics. The award acknowledges the work of researchers in turning their ideas into viable Canadian businesses. “Not only will their inventions ultimately help Canada to recover from this crisis, but with continued investment in talent, research and development, they will ensure we keep our spot in the global innovation economy,” says Mitacs CEO and scientific director John Hepburn. NuPort Robotics appears to be well on its way to achieving that goal. Since its launch, the company has grown from two to 10 people, and is on track to increase to 16 next year. As the technology gets closer to deployment NuPort will hire oversight officers, inspection officers and mechanics, among other positions. “We’re aiming to reverse the trend of ‘brain drain,’ or top talent leaving the country, by creating jobs for artificial intelligence professionals in Canada,” Sahdev says. In addition to its initial pilot partner, the company is looking for other potential customers and transportation companies and is also seeking seed investments to boost its growth strategy. “We’re currently the only company in Canada working on autonomous, self-driving trucks for short distances,” Sahdev says. “We want to establish Canada as the leading country for autonomous vehicles in the world.”

Integration Practical considerations for the deployment of the autonomous trucks include how they will interface with people and facilities at either end of the route. At first there will be drivers on board, Sahdev says, for safety, but also because drivers

insidelogistics.ca

NuPort Robotics is working to integrate self-driving technology into electric trucks.

P R O U D LY C E L E B R A T I N G

vuuZdXżRPXR uRNYdfbfX~ ZdNbvPZdX EquZ NZEb intelligence, robotics, distributed ledger and smart contract process

Intelligent customs document nqfNRrrZdX Wfq RW NZRdu Nqfrr MfqPRq shipping to Canada & USA

Delivering to and from all points USA & Canada

Industry-leading transit times and on-time delivery

LTL, TL and global 3PL Warehousing and distribution

1.800.409.2269

info@polaristransport.com

Online ordering, rating and real time tracking

By Emily Atkins |

PHARMACEUTICAL INDUSTRY

VACCINE READY Prepping supply chains for a coronavirus vaccine

s scientists and researchers work feverishly to develop a vaccine that will work against the virus causing the Covid-19 pandemic, in the background supply chain teams across the pharmaceutical industry and its transport suppliers are working just as fast to ensure those critical medical supplies will be distributed quickly. By all accounts it’s going to be a herculean task. Of the approximately 250 different vaccines being developed around the world, the frontrunners are being designed with differing requirements for temperature control and handling. This means there will not likely be a single uniform methodology across the global temperature-controlled supply chain to handle them. As well, because data about the vaccines’ stability under different environmental conditions will be lacking, they will likely be subject to even stricter controls than normal to ensure the maximum viability and reach. Due to the urgency of the pandemic situation, the bulk of the vaccines produced will likely be carried by air. DHL estimates that ensuring ensure global coverage for the next two years will require some 200,000 movements by pallet on 15,000 flights. “Covid-19 vaccine delivery will be one of the biggest logistical challenges in modern history. No one company can own the end-to-end vaccine supply chain,” said Neel Jones Shah, TIACA board member and global head of airfreight at Flexport. “We need to start working together now to ensure the industry is prepared when the time comes.” That’s why international bodies like The International Air Cargo Association (TIACA) and Pharma-Aero are working together to develop best practices for vaccine transport as the products become available, hopefully in early 2021. Pharma.

insidelogistics.ca

Aero is a non-profit organization headquartered in Brussels, Belgium, that aims to develop reliable end-to-end air transportation for life science and medtech shippers. Together, the two organizations will work to provide the air cargo industry with clearer demands, expectations and supply chain requirements for transporting the vaccines. This will cover critical trade lanes, air cargo capacity, handling and storage, track and trace requirements, and more. The program is also expected to help vaccine shippers gain more understanding about the capabilities of logistics players. It is expected to share information and best practices with the industry by the end of 2020. In the meantime, however, what’s clear is there will be a scramble to find enough supplies in a few key areas of the supply chain. First is temperature-controlled packaging. In its research DHL suggests a need for almost 15 million cooling boxes and the required volume of cooling bricks or dry ice to safely transport 10 billion vaccine doses. “Even under aggressive assumptions, both the availability of suitable packaging as well as the maximum-allowed quantities of dry ice in air cargo transport could potentially limit shipment possibilities in certain cases if the preparations are not made in time,” DHL said in its paper “Delivering Pandemic Resilience”. DHL also points out that the last mile complexity for temperature controlled pharma – ensuring consistent temperature management for individual boxes/parcels – is much greater than it is for one pallet shipper. As well, handling the frozen product, that may need to be at minus 80 Celsius, requires special equipment – such as gloves – and processes to avoid injury. A vast number of couriers and consignees

need to be informed or even trained to ensure safe handling. Likewise, third-party logistics providers are facing a crunch. “It’s going to be a tough one because you’re talking about millions and millions of vaccines, which require coolers, which require massive infrastructure,” said Peter Tostevin, SCI’s vice-president of healthcare. “And I can guarantee you right now that there isn’t a 3PL out there that is going to be able to manage that demand.” Tostevin added that the 3PLs that want the vaccine business are busy expanding in that space right now in order to be ready, but he feels the majority are not prepared because of the infrastructure involved in ensuring temperature control. Some are taking lessons from the initial surge in demand for personal protective equipment (PPE) and medical equipment at the start of the pandemic. A key lesson learned was the importance of collaboration and communication between governments and service providers to ensure supply lines stay open. “In the Americas, the shipment of PPE and medical supplies took priority and represented a great portion of our total shipments during the first months of the pandemic, with most of these coming from Asia,” said Larry St Onge, president for the global life sciences and healthcare sector at DHL. “Then came the test kits for Covid-19. These urgent supplies required an extended network that was flexible enough to meet this demand in various parts of the world, a strong base of temperature-controlled services and a reliable medical supply chain. Once these vaccines are ready to be shipped, a close partnership between the public and private sectors would ensure that these highly sensitive shipments preserve their integrity and are successfully delivered around the globe.”

W E S T COA S T G AT E WAYS

| By Emily Atkins

ACCELERATED DEVELOPMENT The Alberta to Alaska Railway’s speeding timeline

hysically it’s still nothing more than a line on a map, but in three years the Alberta to Alaska (A2A) Railway will begin moving cargo. That’s two years ahead of schedule, a timeline that has compressed at least partly because of the Covid-19 pandemic. In an interview, chairman and founder Sean McCoshen shared an update on the 2,500-kilometre railway project that will see cargo and passengers move between Fort McMurray, Alberta, and tidewater ports on Alaska’s south-central coast. The railway will consist of new rails between Alberta and the Alaska border, connecting there to the existing Alaska Railroad under a 70-year exclusive agreement. The A2A project was formally founded in 2015, but the notion of a railway connecting the Canadian interior with Alaska is nothing new. In fact, the Alaska Highway, which winds from Dawson Creek, British Columbia, through Whitehorse, Yukon, to Delta Junction, Alaska, was proposed in the 1920s and built during World War II, partly to support the construction of a railroad that would ensure supply to Alaska after the Japanese began the Pacific front with the attack on Pearl Harbor, Hawaii. However, when the war ended the project was shelved for economic reasons; there just wasn’t the population in the north to warrant the cost of such a large infrastructure project.

“The last significant construction project similar to this in Canada was the building of the CN Railway.” – Sean McCoshen, chairman and founder, A2A Railway

countries, the economics have changed and the project is moving forward. In the summer of 2020 the company began the surveying process, which McCoshen said at the time meant “we are now officially ‘boots on the ground’ here in Alberta”. This survey is done from the air, comparing the route that has been planned with the typography to fine-tune the routing around hazards, engineering roadblocks or communities that don’t want the railway passing through. The process takes three to six months, building on years of engineering studies done before. The next step is soft construction. “This is a very large construction project, and they don’t get built in a straight line,” McCoshen said. “You get a little piece here, little piece there, and we’ll start construction in the areas…where we have permission to start construction from all regulatory aspects.”

Feasibility Now, however, with the development of the Alberta oil sands, massive Canadian grain exports and booming trade with Asian

The Covid-19 boost Already supported by the Alberta, Northwest Territories, Yukon and federal

governments in both Canada and the U.S., the pandemic has increased their interest in seeing the railway come to fruition. “I’m really surprised,” McCoshen said. “I think Covid-19 and the horrendous toll that it’s taken on the economy and jobs has actually assisted us in terms of governments wanting to see us get up and running a lot quicker.” He pointed to the projected 28,000 jobs the project will generate as a big factor in the growing government support. Likewise, the railway will improve the quality of life and reduce the cost of living for numerous northern communities. According to McCoshen, communities and supporters along the route want to see it happen, want to participate, and want the railway to come through their communities because they want the jobs and the business that it’s going to bring, but they don’t want to wait five years for it. “There’s no internet, there’s no running water, gas has to be flown up for heating. It’s really quite incredible, but we’re going to adjust all that, and this is the whole point of this,” McCoshen said.

Hurdles McCoshen likened the scale of the project to the Hoover Dam in the U.S. or the Channel Tunnel that connects the U.K. to France. “The last significant construction project similar to this in Canada was the building of the CN Railway,” he noted. That scale means the “headaches go from whether or not you’re investing in something that’s going to see a return, INSIDE Logistics OCT OB E R 2020

The A2A Railway’s route takes it from Fort McMurray, Alberta, to tidewater Alaska.

whether or not people are going to accept the idea, to other issues, and now it’s kind of more along the lines of a regulatory construction issue.” He was quick to add that with the huge team of top bankers, lawyers, consultants, and government relations and lobbyists, “it’s a joy working on this. I do not mince words here: Is there a problem every single day? Yes. Is there a problem every 15 minutes? Yes. But you just get into a mindset of working through things, and adjusting accordingly, and making the business open to change. That’s what we’re doing.”

Customers and cargo The railway was conceived to transport bulk commodities including oil, grain and ore in addition to containerized goods. Customers have already signed up to move their goods over the A2A lines with agreements that will be formalized as the opening day approaches. “We have a breakdown of products, there’s a significant amount of export traffic through Tidewater in Alaska, and

insidelogistics.ca

there’s also a significant amount of input product too, through containerized goods. The population is growing, consumption is growing, and the transportation network that we have, both in the United States and Canada is getting stretched…and there is no one dominant cargo in this thing,” McCoshen said. In relation to that ‘stretched’ rail infrastructure, he stated flat out that the railway will not be competing with CN and CP for West Coast traffic. “I think they would probably use some of our lines. We’re not going to compete with them, it’s that simple. We’re a completely different route. I think some of their routes will hook up to our routes, and we’ll do business together like any other competitive environment, but…they arguably have pretty good routes right now themselves, so I don’t think they’re worried at all.” However, the A2A website claims that South-central Alaska ports are four days closer to Asia than any other North American port, and that this will facilitate lowest-cost transport of cargo.

The need for speed With timelines compressed from five down to three years, McCoshen has been feeling the pressure. “When it went from five years to three years, a lot of people thought ‘hey, you must be really happy’. Not necessarily,” he said. The shorter horizon doesn’t mean there are fewer pieces to put in place; it just means they have to get done all at once. “Rather than doing one study at a time, we may be doing six studies at a time, this kind of thing. We’re doing our best to satisfy the government’s demand to get this going and hire people to start construction,” McCoshen noted. But what this means is “a $300 million annual budget for x is now a $600 million annual budget because you’re taking what you were going to do in three years, and bringing it down into a year and a half. One thing I think people need to understand is there are no set timelines for any of this stuff. There is simply a to-do list that you have to do, and if you do the to-do list in one month, great, and if it takes you five years then that’s fine too.”

You promised reliable service to and from Canada. Weâ€™ll help deliver. Your business doesnâ€™t stop at the border, neither does Old Dominion. We provide 100% real-time freight visibility for your shipments between Canada and the U.S., with direct loading to major U.S. markets. Your transborder crossings are pain-free with ODâ€™s in-house 24/7 customs clearance & brokerage services and a single point of EQPVCEV 2NWU 1&oU KPFWUVT[ NGCFKPI QP VKOG TGEQTF CPF NQY ENCKOU TCVKQ RTQXKFG EQPÆ‚FGPEG YKVJ GXGT[ UJKROGPV

Â©202 2 2 0 Ol 20 202 O d Do omin mini m n on n Fre reig eig e ei g htt Line, L ine, ine e Inc ncc . Al n Alll rights rights g gh reserve res erve erv ed. d

*Sou ource: urce: ce e 201 0 9M 01 Ma st stio tiiio & C o.. Natio ttio ttional n LTL na TLL C Car Carr Ca arr ie a iier e Repo eport. rt.

For more information, visit odï¬‚.ca or call 1-800-432-6335.

T E C H N O L O G Y F O CU S

AUTOMATION THAT REALLY MOVES

Automated Mobile Robots are ﬁnding their home in distribution centres

Mobile AS/RS

AMRs for fulfillment

The AutoGuide Mobile Autonomous Storage and Retrieval System (Mobile ASRS) works with existing racking systems and pallets. In addition, AutoGuide AMRs bring facility-wide freedom to automation strategies, so facility managers don’t have to restrict storage and retrieval operations to specific, crane-only zones.

Kantsu has selected inVia Robotics to supply autonomous mobile robots that automate fulfillment operations in its main distribution centre in Osaka, Japan. inVia’s modular automation system, which includes a fleet of 200 autonomous mobile robots and AI-driven software, will automate e-commerce picking processes and allow warehouse workers to sort at rates of 800 to 900 units per hour per person.

To deploy AutoGuide Mobile ASRS, most operations will need: • Their existing facility – no new racking systems, custom pallets or dedicated storage and retrieval zones required. • AutoGuide high-payload AMRs, selected based on unique facility needs. Choices include a pallet stacker, tugger, and AutoGuide’s newest AMR, the MAX-N high bay autonomous forklift designed to lift 2,400 pounds to a height of 36 feet. • SurePath Enterprise fleet control software, which connects with the facility WMS and inventory management applications to view orders received and keep track of inventory. SurePath Enterprise software, included with Mobile ASRS, defines the most efficient travel route for each job. Its inventory management software connects with existing WMS and inventory management applications. With AutoGuide Mobile ASRS, once the material comes off the truck, a collaborative team of AMRs takes over to get the material where it belongs. The patent-pending MAX-N Base AMR can be converted to a pallet stacker, tugger, or high bay forklift as needs change.

insidelogistics.ca

Automated trailer unloading Austin, Texas-based Fox Robotics has landed US$9 million in Series A funding to advance development of its self-driving forktrucks that can unload trailers without modifying the warehouse environment. Fox’s forklifts can be installed and running in a new warehouse in less than a day. The funding is led by Menlo Ventures, a venture capital firm in Silicon Valley. Additional investors include Eniac Ventures, La Famiglia, SignalFire, Congruent Ventures and AME Cloud Ventures. “We are proud to back the team at Fox Robotics,” said Mark Siegel, partner at Menlo Ventures. “The company’s value proposition is clear: Their full-stack solution for self-driving forklifts can increase workplace productivity 200 to 300 percent. They bring huge efficiency to the supply chain.” Fox’s flexibility comes from using technology similar to what is used in a self-driving car, customized for the warehouse environment. Fox’s forklifts use AI to detect pallets, trailers and obstacles in real time, and don’t need pre-programmed fixed locations. They use sensors and dynamic planning to plan routes on the fly and don’t require hand-drawn or memorized routes. This investment lets Fox ramp up production to meet demand. It has been running pilots with large logistics companies since last October. “The market for warehouse automation is huge and growing. The future of warehouse automation isn’t fixed automation systems that cost several hundred million dollars. It is mobile robots that are low-cost, flexible and can be deployed incrementally and quickly,” said Charles DuHadway, CEO of Fox Robotics.

Kantsu is one of the leading providers of logistics and warehousing services to e-commerce businesses in Japan. “Our customers are being pressured to provide more products and faster service to their consumers, and inVia’s robots ensure that we are always delivering the right products quickly,” said Hisahiro Tatsushiro, CEO of Kantsu. “inVia Robotics’s technology allows us to offer superior logistics services to our customers.” The system includes inVia Logic warehouse optimization software and a fleet of inVia Picker robots. inVia Logic employs advanced AI algorithms to adapt to fluctuating demand in real time and adjust warehouse mapping to create more efficient paths and processes. The inVia Picker robot automates the storage and retrieval process. Kantsu has also chosen to manage inventory replenishment and cycle counting through inVia’s system, which helps maintain inventory accuracy, ensuring customers receive the items they want when they want them.

Fox aims to automate 20 percent of the 1.5 million forklifts sold annually (a $7.5 billion market). Fox is led by DuHadway and Peter Anderson-Sprecher, who led robotic teams at Stanford, CMU, Bosch, Google Robotics, Google X and KUKA.

Keep “Your Inside Track to Canada’s Supply Chain”

Visit InsideLogistics.ca to SUBSCRIBE to the e-newsletter. Delivered every Tuesday and Friday.

ROBOTICS

WAKING UP FROM ROBOT DREAMS How to take the concept to reality WAREHOUSE ROBOTICS HAVE passed

the awareness stage. Distribution centre managers are asking for practical guidance to turn robotic ambition into adoption. To set operations up for a successful robotics investment, there’s much to consider. The pace of change keeps accelerating – what does that mean for today’s robotic technologies? Will they become outdated in a couple years like the newest smartphone? There’s more – questions abound regarding employee acceptance, IT, integration, long-term planning, etc.

Appoint an internal champion Whether tapping an existing resource or hiring a specialist, more companies are assigning an internal champion to be responsible for automation throughout the organization. This person is in charge of finding answers to the questions above, and coordinating automation projects. Acting as a bridge between outside experts and the unique demands of their operation, the champion identifies best-fit applications for robotics to maximize ROI. Implementation is an especially critical time for an internal champion. With a consistent point of contact, technology suppliers get the access and resources they need for efficient implementation and commissioning, including everything from sufficient Wi-Fi bandwidth to IT configuration for integration with software systems. The champion is responsible for creating a culture of acceptance, and must educate internal staff on how robotics will be used and the benefits.

Understand available technologies Part of understanding what robotics can do and how it fits in the short and near term is a basic comprehension of the technology. Mobile robotic solutions commonly use LiDAR, a laser-based navigation technology that produces a two-dimensional view of the facility by looking for hard features like columns, walls and racking. Like any technology, navigation ILonline.com

MICK MCCORMICK is director, robotics and automation for Yale Materials Handling Corporation

for mobile robotics continues to evolve. At present, some LiDAR systems have a range of 60 feet, but in the future, this will extend to 90 feet, then eventually evolve from 2D to a full 360-degree, 3D view – looking at the ceiling, in addition to walls and racks. What does this mean for operations using or considering a solution with a contemporary LiDAR system? Rest easy. Unlike the slow degradation of many consumer-oriented tech products, current-gen mobile robotic technology will continue to perform as designed.

Qualify your operation’s workflows With an internal champion leading the charge and technology understood, it’s time to figure out where robotics fit into daily operations. Today’s robotic solutions are designed with a certain set of tasks in mind. Managers must identify the best-fit workflows to deploy robots for maximum effect. Are there turnover-prone positions that are a struggle to staff? Better yet, are these positions characterized by repetition or long horizontal movements? Using positions with consistent staffing challenges as a guide, find where robotic abilities

overlap to automate entire processes or key repetitive elements. Basic functions like load transportation, storage and retrieval are particularly well suited for automation. Robotic lift trucks, for example, have point-to-point navigation capability, and more advanced solutions can even autonomously reach deep into storage racks up to 30 feet high. Robotics suppliers require a common set of facility speciﬁcations to qualify an operation for robotics, and then design and quote a solution. This includes: • Facility CAD drawing, preferably with stops and aisles highlighted; • Load dimensions and weight range; • Throughput levels; • Aisle widths; • Travel distance; • Speed limit; • Future goals.

Plan for phased implementation Transitioning to automation does not happen overnight. A longer process, done right, will always be more effective than an error-filled rush to the finish. Operations should consider a phased approach to robotics, moving incrementally from simpler to more complex tasks across various applications and workflows. Scaling up in this manner allows the rest of the organization to get comfortable with automation and provides the flexibility to work out the kinks in critical processes. Planning across five to 10 years can account for the continued evolution of technology and a changing competitive landscape.

The knowledge to get up and running With the market showing a greater appetite for robotics, more providers will join the market and end users must become better-informed consumers of robotics solutions and services. This practical knowledge is critical to select vendor partners, set realistic goals and ultimately get results.

WEBSITE

PAGE

3D Storage Solutions ................................................... www.3Dstoragesolutions.com .................................................................. 39 3PL Links

...................................................................... www.3pllinks.com ....................................................................................

Air Canada Cargo......................................................... www.aircanadacargo.com .......................................................................... 2 Bastian Solutions .......................................................... www.bastiansolutions.com/autostore ........................................................ 8 CIFFA ............................................................................ www.ciffa.com/FIATADiploma ................................................................... 12 CITT .............................................................................. www.citt.ca/ccpl2020........................................................................ 20 & 21 CN Rail .......................................................................... www.cn.ca/open-for-business .................................................................. 40 CP Rail .......................................................................... www.cpr.ca.................................................................................................. 4 GX Transport ................................................................ www.gxts.com ............................................................................................ 9 Oceanex ....................................................................... www.oceanex.com ...................................................................................... 7 Old Dominion Freight Line........................................... www.odfl.ca .............................................................................................. 30 Polaris Transportation Group ....................................... www.polaristransportation.com ............................................................... 26 Uline ............................................................................. www.uline.ca .............................................................................................. 10

INSIDE Logistics OCT O B E R 2020

T R A D E U P DAT E

HAPPY ANNIVERSARY TO CETA! How three years of the European deal has affected Canadian trade CETA, the Comprehensive Economic

Trade Agreement, our free trade agreement with the European Union, had its third birthday on September 21. As customs duties (or tariffs, as they are also called) on most products were eliminated on that date, the agreement opened great opportunities for Canadian manufacturers and importers to competitively source raw materials, components, parts and finished products from Europe. It also provided our exporters with access to a huge new market, at a time where our largest export market, the United States, remains unpredictable, as we saw with the aluminum tariff issue. In addition to making European products more competitive in Canada and Canadian products more competitive in Europe, trade in services and public procurement were made easier in both directions. As this trade agreement came into force at the end of September 2017, let’s look at how Canada’s trade with Europe evolved between 2017 and 2019. There is not much point looking at our 2020 figures, since they are greatly impacted by Covid-19; our international trade nose-dived across the board in March and has not yet reached pre-pandemic levels. We’ll look at our exports and our imports to and from the first eight individual markets. Together, they represent about 85 percent of the total and are therefore representative of the trend. As we can see from the tables below, trade between the two partners has increased Canada’s exports to

United Kingdom

CHRISTIAN SIVIÈRE runs Solimpex and is an international trade consultant and lecturer. christian.siviere@videotron.ca

significantly in both directions. Meanwhile, a recent Global Affairs study of Canada’s international trade provides interesting insight. The study measures, among other metrics, the utilization rate of the preferential tariffs by Canadian exporters and importers, and the results are surprising. It seems that so far, not all Canadian exporters and importers are taking full advantage of CETA. The utilization rates show the proportion of eligible goods for which a preferential tariff was used. In 2019, the average rate for Canadian exports to the EU was only 53 percent and it was even lower for imports at 46 percent. The good news is that both rates were up from 2018, CETA’s first full year of implementation: up three percentage points

CAD Billions CAD Billions Percentage 2017 2019 change

Canada’s imports from

for exports and close to nine percentage points for imports. While the annual utilization rates are trending up for the EU overall, they differ for individual countries; both import and export rates for Germany and the United Kingdom (which leaves the EU in January 2021) were below the average, while they were above for France. One element not taken into account is the Incoterm, which determines if the seller or buyer pays the customs duties. That would be an interesting additional piece of information for the research to include. In any event, these findings do suggest that further promotion efforts are needed, with special attention to some markets like Germany and the United Kingdom, to increase CETA utilization rates by Canadian businesses. And since according to this study, only about 50 percent of Canadian companies dealing with Europe actually take advantage of the preferential tariff treatment, it means there is still room to grow the market and increase our business with Europe. This, together with CUSMA with the United States and Mexico, and the Trans-Pacific Partnership with Pacific countries, brings new opportunities for our exporters as we gradually emerge from the pandemic. Why are exports so important? According to World Bank data, in 2019, exports of goods and services represented 31.64 percent of Canada’s GDP. CAD Billions CAD Billions Percentage 2017 2019 change

17.129

19.194

+12

Germany

3.572

5.520

+54

United Kingdom

8.904

9.225

Belgium

3.351

3.047

-9

Italy

8.151

9.470

+16

France

3.097

3.293

France

6.192

8.693

+40

Netherlands

2.883

4.864

+68

Netherlands

4.006

4.662

+16

Italy

2.196

3.143

+43

Belgium

3.171

4.964

+56

Spain

1.584

1.434

-5

Spain

2.808

3.496

+25

Sweden

0.701

0.375

-47

Sweden

2.199

2.287

34.513

40.87

+18

53.413

62.12

+16

Total first eight ILonline.com

Total first eight

17.982

19.324

SA F E T Y F I R S T

THE SECOND WAVE OF COVID-19 Get your workplace ready with this 12-point plan ARE FLARE-UPS of Covid-19 across the

country and elsewhere early warning signs of a second wave? While businesses have reopened, the pandemic is not yet over, and epidemiologists warn that a second wave may be inevitable. This time, however, we can be better prepared to face the types of challenges the second wave will bring. Now is the time for workplaces to take action. The goal is to pivot quickly, while keeping your employees healthy and ensuring your workplace continues to operate. While there’s a lot to think about, there are many tools and resources to help you navigate through this. If you already have a pandemic team or business continuity team, start with them. You can then add other essential voices, such as human resources, operations, IT, managed systems, marketing and sales, and customer service. Coordinate your planning with employee groups, such as the joint health and safety committee. All of these voices can help you identify issues and solutions, and implement an action plan. Here are 12 suggestions for your plan of action. You can expand on or customize them to reflect your workplace requirements. 1 Review your response to the pandemic so far. What worked well? What could you have done differently? For instance, how could decision-making and implementation be made more effective and timely? Are employees and customers following your Covid-19 precautions? If not, what are the challenges they are facing? 2 If you haven’t recognized Covid-19 hazards and assessed the risks, do it now. Are the new hazard control measures working? Could new measures implemented since the outbreak began have introduced new hazards? To reduce the risks of Covid-19 in the workplace, become familiar with the Hierarchy

STEPHEN SHAW has worked in human resources and operations and uses these experiences to bring forward the needs of internal and external customers. In his current role as director, integrated operations, he leads the pandemic response team at Workplace Safety & Prevention Services (WSPS).

of Controls that includes elimination, engineering, administrative and personal protective equipment. Have you adopted RACE – Recognize, Assess, Control and Evaluate? Integrate new Covid-19 policies and procedures into your established policies and procedures. For example first aid, travel, working from home, sick leave and housekeeping. Draw up contingency plans for a possible return to a lower stage of opening – even a full lockdown. In the first round of lockdown, adaptability was key as many essential businesses quickly adopted new measures to remain operational. Take the time to evaluate what worked and what you need to improve in case of another round of closure. Start putting those practices and systems in place now. Keep your emergency contact list up to date. Include alternative contact methods. Record contact information for all visitors for contact tracing purposes.

7 Continue monitoring Covid-19 in your area so you know what stage your region is in and how the pandemic is trending. How would a change affect your customers and suppliers? 8 Ensure you have enough PPE and other supplies on hand in the event of a second wave. Line up preferred suppliers now. 9 Keep employees engaged in minimizing Covid-19 hazards. Rotating members on your recovery team, increasing the frequency of joint health and safety committee inspections, and creating an ideas incubator are just three possibilities. 10 Up your efforts to minimize employee stress and anxiety. The pandemic has changed our workplaces, possibly forever. In addition to many physical safety considerations and risks, it has also magnified the importance of mental health. The risk of burnout and other mental health issues will only increase. What can you do to minimize this risk? For example, have you surveyed employees to assess anxiety levels and identify issues (e.g., “Have you had sufficient training to interact safely with customers and co-workers? Do you feel you have the right PPE? Do you have childcare or eldercare issues?”). 11 Consider your options for continuing or restarting health and safety training, including orientation training if you are hiring new employees or bringing employees back after an extended period away from the workplace. Update your health and safety training matrix, find out who requires certification or refresher training and consider virtual training options to meet your compliance deadlines. 12 Promote flu vaccinations to keep employees healthy and away from emergency departments. Focus on overall health and well-being of employees – if a second wave coincides with flu season, more employees may be off work, and for longer periods. INSIDE Logistics OCT O B E R 2020

THE VIEW WITH LOU

DON’T IGNORE THIS You need to know now if your motor carriers will be able to comply with the federal ELD implementation deadline THE COVID-19 PANDEMIC has dramat-

ically changed the plans of many transportation companies and the shippers who employ them. One thing that hasn’t changed, however, is Ottawa’s insistence on meeting its June 2021 deadline for ending the long-running charade of antiquated (and easily altered) paper logs being used to keep track of truck driver hours of service. Pandemic upheaval be damned, Ottawa so far is sticking to its guns that by June next year federally regulated motor carriers will have to adopt electronic logging devices (ELDs) to keep track of their hours of service. Why do shippers using trucking services need to get this date on their radar in addition to all the other supply chain changes they’re grappling with at the moment? Because the ELD mandate affects more than 150,000 truck drivers across the country. And because, if history and our research are any indication, there will be many motor carriers who, despite plenty of advance warning, will not be able to meet the implementation deadline. That will mean they won’t be able to legally move freight and that spells service disruption in capital letters. That’s exactly what happened when the US mandated the move to ELDs for trucks plying its highways. Our research shows the same will likely happen here. Only 55 percent of those responding to our recent Pulse Survey said their truck fleet is currently using ELDs. While 63 percent said their fleet would be ELD mandate-ready come next June, 17 percent said they weren’t sure and 20 per cent said a flat out no they would not be. That’s more than a third of the sample predicting their truck fleet operations may not be able to meet the federal ELD implementation deadline. Imagine not being able to count on a third of available

ILonline.com

LOU SMYRLIS is managing director, Newcom Media’s Trucking & Supply Chain Group

More than a third of trucking companies we surveyed predict they won’t be ready for the ELD mandate in June 2021.

truck capacity for your truck freight movements for the second half of next year. In the U.S., the Federal Motor Carrier Safety Administration (FMCSA) granted a two-year grandfathering period to carriers who were already using the previous digital technology, electronic recording devices (ERDs), to transition to electronic logging devices (ELDs). And yet there were plenty of carriers who still weren’t able to comply with the deadline. Transport Canada had initially proposed a similar two-year grandfathering period and then decided against it. It’s do or die for Canadian motor carriers come next June.

Of course, being ELD-ready requires more than just having the technology in place by the implementation date. Getting staff to first accept the new technology and then training them to effectively use it, takes time. Even a small change in a company can create upheaval and ELDs are no small change. How concerning is it then that our research found that only 56 percent of trucking industry respondents preferred the new system over the old one, and that when asked to rate on a scale of one to 10 how prepared they felt Canadian trucking was for the change to ELDs, their collective rating was just 3.7 out of 10. The Private Motor Truck Council of Canada, representing companies who run private fleets in order to transport their goods, has recently made an impassioned plea for the federal government to delay its ELD implementation date by six months. Unlike in the U.S., the Canadian mandate requires devices to be certified by a third party and the deadline for naming those third parties has been missed. Even if certifying bodies were announced starting this October, it would take four to six weeks from then for ELD manufacturers to have their devices certified. That leaves carriers about six months to comply with the regulation. But since the Canadian Trucking Alliance and Teamsters Canada, both influential industry supporters of the ELD mandate, are not siding with the PMTC in asking for a delay, there’s little incentive for Ottawa to change its original timeline. It all adds up to this: Now is the time to begin serious conversations with your motor carrier partners about how they are addressing the ELD implementation deadline. You need to know if these are the carriers you can bank on doing business with next year, or if it’s likely you will need to find new partners.

T H E B I G G E R PI C T U R E

THE WORST JOB IN THE WORLD Seafarers stranded at sea are important frontline workers COVID-19 HAS ILLUSTRATED the shock-

ing degree to which many organizations were unprepared to deal with the commercial and social impact of a pandemic. This is particularly egregious since the concept of ‘risk management’ has been studied since the 1950s, and Covid-19 must certainly qualify as one of the greatest risks humanity has faced since then. One would think that governments and businesses would be better prepared after seventy years of risk management practices. It’s particularly ironic that the study of ‘risk’ has it origins in the insurance industry, an industry that profits from identifying and avoiding liabilities associated with risks, and that commercial industries would not have taken more prudent steps to protect themselves from uninsurable risk. This issue surfaced quickly after the onset of Covid-19, when importers in China declared ‘force majeure’ after vessel cargos could not be offloaded in Chinese ports due to lack of manpower. Contract language around ‘force majeure’ typically describes a situation where one of the parties is absolved of its contractual responsibilities due to events beyond its control. Anyone who has been involved in marine insurance claims knows that the eventual outcome for many claims may be delayed for months, or even years, in litigation involving the attachment of liability flowing from abstract terms like “act of God”, “frustration” or whether or not Covid-19 will be interpreted as a “triggering” event. In other words, don’t expect your cheque anytime soon. Lost in these multi million-dollar machinations is the plight of the lonely seafarer. These are the men and women who work on the approximately 50,000 merchant ships that sail the world’s oceans, delivering 90 percent of world trade according to the International Chamber of Shipping. The IMO (International Maritime Organization) estimates this workforce at over a million people, many

LAURIE TURNBULL MSC, CCLP, is a Professor with the School of Business, Supply Chain Management – Global program at Conestoga College Institute of Technology and Advanced Learning in Kitchener, Ontario.

‘By mid-summer 2020 approximately 300,000 seafarers were stranded aboard ships.’ working 12-hour shifts, six and seven days a week for up to six months or longer. A recent CNBC report describes a pre-pandemic maritime industry of 100,000 crew changes each month, enabling fresh crews of seafarers to relieve those who completed their voyage contracts. Due to Covid-19, however, which prevented seafarers from embarking or disembarking from vessels in port, that number dropped to between 20,000 and 30,000 crew changes each month. By mid-summer 2020, the International Transport Workers’ Federation estimated approximately 300,000 seafarers were stranded aboard ships worldwide, while another 300,000 were stuck at home, unable to relieve those on board. Conditions on board for those stranded at sea worsened to the point where rumblings of “strikes” were eventually heard as seafarers were unable to disembark from their water-bound prisons.

With no one to take up their cause, seafarers quickly became people with no home, or at least not one they could get to. Hard to believe that no one envisioned a scenario where as many as 300,000 people could be stranded at sea, and yet that’s exactly what happened. On May 27, the IMO, along with several other United Nations agencies, issued a statement asking governments and regulatory authorities to permit seafarers to disembark and embark ships in port for the purposes of crew changes. This was followed on June 12 by a statement from the United Nations SecretaryGeneral António Guterres, expressing concerns about the growing humanitarian crisis facing seafarers who had been stranded at sea for months, and asking all countries to formally designate seafarers as frontline workers in order to facilitate crew changeovers. In July, the U.A.E. and Denmark were among the first countries to announce they would allow crew changes following the International Maritime Summit on Crew Changes, where 13 governments including the United Kingdom, Denmark, France, Germany, Greece, Indonesia, Netherlands, Norway, Philippines, Saudi Arabia, Singapore, United Arab Emirates, and the U.S., acknowledged that the issue of ship’s crew changes was the most significant operational challenge to global trade and recommended that seafarers’ tours of duty not exceed 12 months. While seafarers are invisible to most consumers, their plight during the pandemic illustrates the need to re-evaluate their role in facilitating global trade. While many of those stranded at sea in 2020 can be forgiven for thinking they had the worst job in the world, it does not undermine their necessity. Surely frontline workers who put themselves at risk to deliver 90 percent of world trade, including food, consumer goods and medical supplies, can now be seen as performing some of the world’s most important jobs. INSIDE Logistics OCT O B E R 2020

STORAGE

SOLUTIONS

L I M I T E D

We don’t sell our solution to your problem... It’s our problem to develop your solution.

KEEP YOUR INVENTORY MOVING 3D PICKING SYSTEMS SOLUTIONS

1 (877) 557-2257 3DSTORAGESOLUTIONS.COM MANUFACTURING

RETAIL

AUTOMOTIVE PARTS

ELECTRONICS

PHARMACEUTICAL

REACH FARTHER.

3 coasts, 15 ocean terminals, 23 inland terminals and growing.

PRINCE RUPERT

PRINCE GEORGE EDMONTON SASKATOON VANCOUVER

CALGARY REGINA

MONCTON

WINNIPEG QUEBEC MONTREAL

HALIFAX SAINT JOHN

DULUTH CHIPPEWA FALLS ARCADIA

TORONTO DETROIT

CHICAGO JOLIET DECATUR

INDIANAPOLIS

MEMPHIS

JACKSON NEW ORLEANS

MOBILE

CN is focused on collaborating with our customers, our supply chain partners and our communities to create a stronger North American economy.

We're ready to help you reach farther. Contact us today. | cn.ca