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September 2011 Vol. 5 — No.1 October 2010 | Vol. 4 – No.2

` 100

THE POWER OF CHANGE

Method In Motion

Syamprasad L, Marico’s SCM head, reveals the strategy that transformed his company‘s supply-chain. Page 20

amit mukherjee, Vicepresident (iT and supply chain) and group cio at rpg, has deployed exemplary supplychain strategies at spencer‘s retail >> page 34

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th

ANNIVERSARY ISSUE TElEcom logisTics 20

GANDHI‘Sof INDIA 46 Movement telecom network equipment How some companiesopens amanage windowtheir of rural opportunity SCM

low NEglEcTEd adopTioN 24 waTErways 44 WAL-MART India, how’d that affect us...08 Why WMS still doesBECKONS: If Wal-Mart Retail Indiaenters is ignoring inland notCASE have enough waterways at its own STUDY: How Future Retail improved warehouse throughput...30 takers in India peril RIGHT PILL: Our pharma-logistics event was well-received. A transcript...34


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eDITORIAL

>

The Stick And The Murky Water

L

ast month, one fine morning, as the skies opened up over Mumbai city yet again, my residential complex turned into an island like many others in the vicinity. And like many of my neighbors, I ventured out for my daily commute to work. In doing so, I had to wade through calf-deep water, hoping to reach my car before the pathogen-laced muck seeping in from the overflowing sewers could get the better of my Mumbai-hardened skin. But it was not my trudge that troubled me that day, it was the curious sight of an old man passing me by, dragging along a child who looked clearly not thrilled with the trip. The man wielded a long, thin stick which he would use to probe the submerged ground for potholes. The stick also doubled up as a cane the old man would thrash the reluctant child with, if the child would not keep up, or try to break away from his grip. With every beating, the otherwise timid-looking kid grew stubborn and soon enough, in a sudden act that warmed the cockles of my heart, the kid sucked in his breath, summoned all his strength and pushed the old man into the murky water before running away merrily in the rain. Culminating on the 27th of August, the mass movement against corruption that we saw in our cities and in Delhi, which for the first time since our independence saw active participation from our middle class, was such an act of defiance, albeit of a history-altering sort. Or so I hope. How did our risk-averse middle class – to which I belong – throw caution to the wind to come all out in support of Anna? What suddenly happened? I mean, corruption is not new to our country. It has been around us since the time of independence. We see it everywhere, in our homes – our basic amenities carry to us the stench of murky dealings at our municipalities, at work – for us logistics professionals, our industry is the worst hit of all. Our roads that look like streets of post-air-raid Beirut every monsoon, the extortionate toll charges that our truck operators keep on shelling out even when the construction companies have more than recovered their investment (and made profit) just because some politician may have a stake in these companies – we see its vice-like grip everywhere. Add to it the bribes paid to government officials and traffic cops, and our misery is complete.

So what happened this August? The stick-and-themurky-water phenomenon is what happened to us. During the last few years, as and when our white-collared backs got bludgeoned by the stick of corruption, we buried our heads in the proverbial sand. We were dealt the first blow six years ago when Shanmugam Manjunath, the IIT and IIM alum, Aanand Pandey and Satyendra Dubey, the Editor IITian were shot dead when eyeballing corrupt agents in small-town India. We did not budge from our cushy cubicles. We would see blasts with alarming regularity, ripping through our trains and our public places, maiming and killing our loved ones, friends and acquaintances. And even when we knew all along that our security is manned by inefficient authorities whose greatest expertise lies in winning and clinging on to plum city postings, we did not budge. The night after 26/11, I received a distress call from a friend, an investment analyst. He wanted to do something, anything that could help his city. In the following days, many of us in Mumbai formed citizen forums – I was part of one. A thousand such forums came up and folded up in a matter of months. We were back at our cubicles. This time, however, with the realization that the big stick of corruption has now become a poisonous spear – one which has the power to take and destroy lives. We had received enough beatings and like the child dragged through the murky water, we had had enough of it. This August, we summoned all our strength and stepped out of our silos. At LOG.India, we did our bit too. On the third day of Anna’s fast, our team gathered at Azad Maidan, lit candles (the accompanying photo is proof of that) and held aloft placards with slogans supporting the movement. Even though our candles and placards were taken away by the enthusiastic crowd to be used as media footage, we came back with a sense of pride of having done our bit. It was raining that day too.

Aanand Pandey (L-R) Me, Snehal, Pritha, Jayashree, Shiva, and Dinesh of Team LOG.India

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aanand@logisticsweek.com

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September 2011 | www.logisticsweek.com 5


Contents 8 analysIs

Logistics At The Top n W al-Mart is planning a chain of stores in India.

How could it change India's supply-chain? n L ogistics expert Tim Cook is the new CEO of

30 CasE study

Future Lies In Automation KPMG's Adding Wings highlights some of the innovations companies made in their supplychain. We will print them one at a time.

Apple. What will he bring to the table?

16 Industry EvEnt Two important events last month: The SME Summit, and SCLC's GST on Evaluating SCM Readiness Summit.

18 BEnChmarkIng Pooja Dayal, Head - Business Excellence, DIESL has answers for your warehousing woes.

20 CovEr story The Power Of Change

Marico, with its innovative supply chain methods, is a trailblazer in the logistics industry.

30 34 EvEnt rEport The Best Medicine

LOG.India organized Pharmaceutical & Healthcare Supply-Chain in June. We highlight some takeaways.

46 fEaturE

Reaching Gandhi's India Having played out selling products to urban areas, corporates needed new markets. Rural supplychain is a good opportunity.

22 22

46


sEptEmBEr 2011 54 tItans of logIstCs Meet The Goliaths Of Logistics

LOG.India asks 33 heads at various logistics companies to tell us something about themselves.

t i t a n s

f

Logistics

54

This month, Log. IndIa completed five years of its being in circulation – five rewarding, gruelling, inspiring, testing years of connecting the logistics world with itself and with its customers. To commemorate the fifth anniversary, we thought of approaching the head honchos of logistics players who have shaped this world. We wanted our readers to know what makes these logistics company chiefs – where they hail from, their educational background, where from they learned the ropes of the industry, and their current plans. Fortunately, we received an overwhelming response. Presenting, in all its 15-page glory, our special supplement of this issue on the men and women who drive the industry, or as regard them, and hence are calling this section: the Titans of Logistics

80 Book 5656

INDIA |

September 2011 | www.logisticsweek.com

EXtraCt

One-Of-A-Kind Production is a book on how supplychain managers can manage various categories of SKUs.

ADVeRtIseRs InDeX Coldstar..................................................................... 3 Vijay Logistics ........................................................... 4 Gandhi Automation .................................................... 9 Jay Equipment..........................................................11 Hormann India ..........................................................12 Milestone .................................................................13 Marg-Karaikal Port ...................................................15 Credence Logistics ...................................................17 Shree Rajlaxmi .........................................................19 DIESL ...................................................................... 23 Siemens .................................................................. 25 Knight Frank ........................................................... 32 Godrej ..................................................................... 33 Safexpress .............................................................. 39 Sevenseas Global Express....................................... 41 Om Logistics ........................................................... 45 BLR Logistiks .......................................................... 49 Saudi Transtec ........................................................ 50 Tristar...................................................................... 51 Uniworld Logistics ................................................... 53 VRL Logistics ......................................................... 61 Exide. ...................................................................... 63 Greenearth .............................................................. 65 Blazeflash ......................................................... 66, 67 Frost n Sullivan........................................................ 68 V Trans Logistics. .................................................... 75 Maini Materials Movement ...................................... 77 Manforce Trucks ..................................................... 83 L&T Expo ................................................................. 85 Auto SCM….. .......................................................... 87 Kairali ...................................................................... 88 Honeywell ...............................................................BC Phenix Steel ........................................................... IBC Navistar.................................................................. IFC

august 2011 IndIa’s LeadI

82 panorama

August 2011 October 2010

Books, Journals, Blogs, Technology, C-Profile, and Solutions - a look at what's new in and for the supply chain industry.

Vol. 4 — No.12 | Vol. 4 – No.2

ng LOgIs tIcs Maga zIne www.logistic sweek.com

IND DIA IA

`100 ` 100

Method In Motion

amit mukherje e, Vicepresident (iT and sup ply chain) and group cio deployed exem at rpg, has plary supp chain strat lyegies at spen cer‘s retail >>

The Power of Change page 34

Harish Sharm a, HOD (Mate rial Manageme nt), North Delhi Power Ltd has been a change agent in bringing power to the nation’s capita TElEcom l.

90 EvEnts

logisTics 20

AUTO CORR Movem ent of teleco ECTIOmN 16 netwo Challenrkges equipm in theent wayopens of aauto windo w ofy’sopport industr growth unity

Some forthcoming events coming up in September.

INDIA |

low Page 22 adopTioN 24

NEglEcTE

d Why WAN WMSTED: still does DRIVERS: waTErwa notFDI The industry ys 44 haveBOO enough facesIndia an acute is ignorin takers in India ST: FDI in retail could shorta g inland ge of MHE UPDA benefit thewaterw industays at its own truck drivers...08 TE: The use of MHE at our peril ry in more ways than one... warehouses 13 needs a shot in the arm... 38

September 2011 | www.logisticsweek.com 7


< news analysis

TRAIN OF THOUGHT

India’s logistics demand is vast, and is witnessing external demands placed by global businesses for worldclass SCM practices. Businesses need to find better ways to achieve results on par with international standards.” — Vance lau, VP & MD, Vocollect Asia Pac at a press conference announcing its entry into India.

Very few supply chain companies globally have the capability to provide end-to-end solutions which include taking ownership of the sub-assemblies. Thanks to our acquisitions in the US and UK, we can offer this service in India.” — R Dinesh, MD, TVS Logistics Services at the inauguration of the `2.5 crore logistics assembly unit at Sholavaram.

What we are doing now is to rebuild our supply chain model to ensure delivery within 2-3 days, without carrying an inventory/warehouse. This can sort out issues we face with competition in an economical manner.” — K. Vaitheeswaran, Co-founder and COO of Indiaplaza in an interview to Business Standard.

To meet the estimated economic growth of the next five years, the logistics and supply-chain infrastructure has to grow 2 1/2 times.” — K. V. Mahidhar, Head (Logistics) at Confederation of Indian Industry on how logistics lags in spite of industries growing rapidly.

Will Wal-Mart Revamp Indian logistics? in a country where lack of sustainable infrastructure resulted in primeval warehouses and unorganized logistics, the entry of wal-Mart may bring about a change, says Anuja Abraham.

W

al-Mart is probably the biggest unbeaten retailer out there that can make their competitors pull up their socks. It is growing rapidly with 5,236 stores in 14 countries outside the United States. They are famous for their tough negotiations with suppliers and forcing competitors to bring down prices, all in the hope of delivering quality products to their customers at the lowest prices. They have currently made their presence felt in India through their only cash and carry store in Gurgaon. Now the retailer wants to expand its presence in India and hopes to open retail stores, if the government relaxes rules on the

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51 percent FDI scheme. But will it affect anything more than the purchasing choice of industrialists, hoteliers, and restaurateurs with its offering of products of highest quality at lowest prices? According to Ms. Sharmila Amin, South Asia – India Area Head of PanProjects Business Division of Panalpina World Transport India (P) Ltd, logistics is at the heart of the Wal-Mart operation that will enable them to lead ahead of their competitors at a lower cost. “When a company like Wal-Mart, which has one of the world’s most sophisticated supply chain management (SCM) practices, enters a market like India,” says Ms Amin, “with

September 2011 | www.logisticsweek.com

When a company like Wal-Mart, with its sophisticated SCM practices, enters a market like India the net result would be in pushing their competitors to upgrade their SCM system. those systems the net result would be to push their competitors to upgrade their SCM system. It will force Indian counterparts to upgrade and synchronize its SCM systems just to remain competitive.”

switch To Organized sector Wal-Mart is able to replenish goods directly from the manufacturer’s warehouse to

the store shelf in less than 48 hours, faster than any other competitor. It has the largest private fleet in the world. It also has a “private fleet driver hand-book” with strict rules of conduct in it; non-compliance will result in the termination of the driver’s services. Transportation costs of Wal-Mart were estimated at approximately three percent of the total costs as compared to five


< news analysis percent of its competitors. Mr. Uday Malya, CFO of BLR Logistiks India says, “It might do some good to the organized logistics sector considering much work is allocated to the unorganized sector at present.” He believes that there is not much unity in the rate, efficiency of the unorganized sector. But this will change, since big players like Wal-Mart deal with only organized players. Currently, India’s logistics sector comprises six percent of organized and 94 percent of unorganized logistics and it contributes at least 13 percent to the country’s GDP. Transportation in India is not only largely unorganized, but also fragmented. Inadequate skills, lack of technological know-how, outdated machinery, and competitive prices are still prevalent in the industry. Cost-cutting is a major factor that drives the Indian logistics sector. Mr. Tom Joseph, CEO of Agility Logistics, holds similar views. He believes the logistics sector is in its infancy with the presence of roughly six percenteight percent of organized warehousing, coupled with limited capabilities of the operators in terms of infrastructure, IT capabilities and processing. But most industry experts believe the logistics sector is in for a makeover in the coming years. “With my experience of working with Wal-Mart in the US, I can confidently say that they are true game changers,” says Mr. Asim Behera, General Manager at SwissLog. “They are a very progressive company that studies every aspect of logistical efficiencies. I firmly believe that they are going to be a vital

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Can Indian companies match Wal-Mart’s high rate of replenishment?

catalyst for changing the Indian logistics scene for retail. I foresee them as the pioneers for possibly bringing the concept of Mega Distribution Centers in India. With regards to India being ready for handling Wal-Mart’s stringent requirements, I think we should look at McDonald’s supply chain success in India, which is a testament to the fact that India can produce wonders with the help of visionaries.”

Upgrading warehouses Wal-Mart has one of the largest private distribution operations in the world. They have more than 40 Regional Distribution Centers (DC). Each one is over one million square feet in size. They operate 24/7 to keep their fleet of tractors and trailers rolling. Inside each DC, more than five miles of conveyor belts move over 9,000 different lines of merchandise. Each DC

September 2011 | www.logisticsweek.com

supports between 75 and 100 stores within a 250-mile radius. Warehousing and distribution is vital to the back-end of any supply chain. As of now, the warehouses in India cannot match the sophistication of international warehouses. This sector is focusing on increasing the shelf life of products through product maintenance and pick efficiency to match industry standards. “While the opportunity is big, it also calls for upgrading the mindset of the warehousing users in India to use an outsourced operation who can bring in more visibility on the stock, which will help in reducing the stockholding cost, increase the availability of the stock at the shop floor available for sale ( without a stock-out situation while stock remains in the warehouse) and reduced inventory levels in

warehouses by making sure that stock is on the move rather than remaining in the warehouse,” says Mr. Joseph. Mr Pankaj Chandra and Mr Nimit Jain of IIM-A have published a study (2007) in which they note that warehousing dominated by small players, with poor infrastructure and poor deployment of handling, stacking and monitoring technologies, has had a detrimental effect on the food supply chain due to low investment in cold chains and allied machinery. Mr. Vishal Gupta, MD of Total logistics, notes that warehousing and distribution will definitely be impacted by the entry of big players like Wal-Mart. Mr. Vineet Kanaujia,General Manager (Marketing), Safexpress says, “Warehousing will be the nucleus of growth of the supply chain and logistics industry in the near future. There


< news analysis will be an exponential growth in demand for world-class warehousing. More and more companies will start concentrating on their core competencies, while having outsourced their warehousing requirements to 3PL service providers.” According to a 2008-09 KPMG report, Indian warehousing occupies 433 million square feet (msf) area. Of this, eight percent is organized warehousing (36 msf) and 92 percent (298 msf) is unorganized. In the unorganized warehousing space also, 27 percent (107 msf) is unaccounted supply, 29 percent (117 msf) is public sector and 44 percent (173 msf) is in-house. According to the Planning Commission, the total existing warehousing capacity is 80 million tons. The additional requirement over the next five years is 35 million tons.

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The prospect of a total refurbishment of the back-end supply chain that mainly consists of warehousing and distribution is also very high due to the entry of big players in the market, believes Padmini Pagadala, General Manager of TPG Consulting. Ms Pagadala says: “Wal-Mart alone will not be responsible for modernization of warehousing. The time is right, the economy looks good. Irrespective of WalMart, people are already starting to get conscious about a few things: Service level and how they can deliver in the most efficient and cost effective manner. There are a lot of businesses moving from conventional warehouses to more sophisticated warehouses just to address these two points. However, the entry of MNCs will quicken the process.” Wal mart’s sustainability reports are impressive for the fact that they have the most sustainable and efficient logistics in the US and UK. Wal-Mart has a distribution center in Tianjin, China, that has won a Green Supply Chain Award from the China Supply Chain Council in 2008. The 4,55,000-square-foot distribution center has a number of sustainable features that help reduce CO2 emissions and energy and water consumption. The Seiyu Group, a subsidiary of Wal-Mart in Japan, has made it possible to transfer 16 percent more goods over the same distance through methods of efficient routing, loading techniques for trucks, consolidating operations and deliveries between 2007- 2008. They have set an aim to reduce fuel consumption required to transport one ton of goods over one kilometer by 25 percent by 2012. Looking at the effect Wal-Mart has had on the supply chain of neighboring Asian countries shows that it, indeed, holds a promise for an upgradation in the Indian logistics sector. “It may not be immediate,” discloses Mr. Behera “they will try to localize practices and adopt the local culture, but eventually it will change. Topics such as pick efficiencies, cold chain compliance, ergonomics in a Distribution Center operation, and safety will be discussed much more than they are today.”


< news analysis

At Apple, What’s On Cook’s Menu? Tim Cook, a logistics expert, has taken over as CeO of apple in the wake of steve Jobs’ resignation. so what does he need to do to fit into his predecessor’s very large shoes?

W

ill Tim Cook’s taking over from Steve Jobs keep Apple in the forefront? Well, that depends on what Cook brings to the table. Will he honor the traditions that the incredible Jobs set, or will he present something new? In a reassuring message to the Apple staff, Chief Executive Cook, a logistics expert, has admitted that Jobs, now a chairman has been his mentor and that he would be looking forward to his continued guidance and inspiration to maintain Apple’s unique position. To Cook’s credit, it must be stressed that he has been instrumental in locking up contracts in advance for critical parts in the company’s devices. It has had the effect

Tim Cook, CEO of Apple, with Chairman Steve Jobs.

is a number-cruncher. When he joined Apple in 1998 Cook ruthlessly cut costs, closed factories, outsourced produc-

Cook has been instrumental in locking up contracts in advance for critical parts in the company’s devices. It has had the effect of securing favorable prices, keeping Apple’s profit margins high.

of securing favorable prices, keeping Apple’s profit margins high, but it has also prevented rival companies from producing competent products at significantly lower prices.

Mixed-bag Reactions While Jobs has a reputation for innovation, his successor

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tion and slashed stock levels. Be that as it may, at this juncture, the company has several products lined up for release, and the picture isn’t that rosy after Jobs’ stepping down. The stock market isn’t smiling. The reaction in electronics circles, including Apple, is a

September 2011 | www.logisticsweek.com

mixed bag. They say that the dynamics of the industry provides no company or product a guarantee that it will not be threatened or upstaged in a couple of months. Joy has proved to be short-lived. Michael Maccoby, a management consultant and author of the book The Productive Narcissist: The Promise and Peril of Visionary Leadership, says, “Jobs is a hard act to follow, but not an impossible one. Apple has created a technology, patents, processes, and so on. It has created the Apple stores. It has created attitudes among customers.”

Cook light Another line of thinking in Silicon Valley is that kids in a garage can build something that can topple the existing order. Indeed, this has been Apple’s own story. But then, it is much harder to take huge risks when

you are not in a garage, but running a $350-billion company. Parts of the mixed reaction, in both the market and at Apple, are that Cook and Jobs are different characters with different approaches, and Cook may try out his agenda, throwing aside his talk of guidance and inspiration and all that. Cook once told the 50,000-employee empire, “We take risks knowing that risk will sometimes result in failure, but without the possibility of failure there is no possibility of success.” He knows what he talking about. When he quit Compaq and joined Apple in 1996, Compaq was going great guns while the scene was dicey at Apple. And where is Compaq today and where is Apple? It is not only Cook, but experts, who feel that conventions may have to be reviewed as per the needs of the times. Jeffrey Pfeffer, professor of organizational behavior at Stanford, says, “The two will otherwise be compared, and Cook would inevitably be described as ‘Steve Light.’ It is better to be different than a second-rate version of what the last person was.” Cook has obviously seen it coming. He knows he must serve something special, if he wants the customers to ask for a second helping.


< industry event

SME Summit Honors Budding Enterprises

“I

ndia SME Leadership Summit” conjointly organized by the Small and Medium Business Development Chamber of India (SME Chamber of India), Indian SME Knowledge Forum and India International Trade Centre (IITC-India) along with the support of Government of Maharashtra was held on August 26, 2011 at Mumbai. Chandrakant Salunkhe, President, SME Chamber of India began

Dr Subir Gokarn, Deputy Governor, Reserve Bank of India inaugurated the Summit.

the event by speaking on how vital the growth of SME is for the growth of our country’s economy. Credit facility at reasonable rates and finance is the major problem faced by small and medium enterprises. Lower down the hierarchy, smaller enterprises find it more difficult to get loans from banks. The chief guest of the event was Dr. Subir Gokarn, Deputy GovernorReserve Bank of India. He, too, addressed the problem of gaining credit from banks as a major hurdle for small businesses. Many other important issues such as the ‘Role of SME in the economic growth of India’, ‘Challenges and Business and Investment Opportunities of SME’ were discussed during this event. Key speakers Dr. Lalit Kanodia, CMD, Datamatics Global Services Ltd; Pankaj Baliga, Vice President, Tata Consultancy

Services; and Ramesh Iyer, senior VP, Tata TeleServices Ltd agreed to the fact that innovation and technology is vital for the growth of SME. Iyer said that SME generates second largest employment and yet their growth is stunted by the lack of technology, infrastructure, training, finance etc. Iyer mentioned that SME will contribute roughly 22 percent to the GDP and nearly 50 percent exports will come from SME in the near future. The SME awarded for excellence in their field are Emmbi Polyarns Ltd, Yashraaj Ethanoll Processing Private Ltd, Al-Aziz Plastics Pvt Ltd, HR Anexi Pvt Ltd, Euclid Infotech and KConnections.

Date: August 26, 2011 Event: India SME Leadership Summit Organizer: SME Chamber of India Venue: Hyatt Regency, Mumbai

Preparing India For GST

T

he Champagne Hall of Novotel Hotel, Juhu, Mumbai came alive with discussions on August 26, 2011, as over 100 senior stakeholders representing India’s top manufacturers, retailers and logistics service providers gathered at the 3rd edition of Supply Chain Leadership Council’s ‘India After GST: Evaluating SCM Preparedness’ Summit. Discussions centered around the impact of GST on their supply chain management function and their

Date: August 26, 2011 Event: India After GST: Evaluating SCM Readiness Summit Organizer: Supply Chain Leadership Council Venue: Novotel Hotel, Juhu, Mumbai

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readiness to handle the significant changes that GST, once implemented, would bring along with it. Sanjiv Deshpande, Head, Finance, GST project, and Dilip Save, Head, Indirect Taxation of Hindustan Unilever India explained that companies must examine their wider supply chain processes including procurement through a GST lens and re-engineer them to optimize the GST benefit. Representing logistics service providers, Malay Shankar, National Business Head, DIESL, explained that GST will make outsourcing SCM an easier and a more logical decision for companies. Parind Mehta, Partner, Indirect Taxation, BSR & Co. said that a number of important items in relation to the logistics industry will need careful consideration alongside the

September 2011 | www.logisticsweek.com

India's top manufacturers, retailers and LSPs discuss GST

development of the final GST code. At the summit, Gautami Seksaria, Founder & Partner, Supply Chain Leadership Council, said that the summit was deliberately designed to make ideas related to GST preparation transparent so that the wheel does not have to be re-invented within each company.


< Here To Help

&

PEB System Is Growing Fast Whether you are a warehouse manager, or a warehouse owner or just a supply-chain enthusiast wanting to know more about warehouse management, we have an expert you can turn to every month for all your queries, on this page. Pooja Dayal, Head-Business Excellence Function, DIESL, will answer readers’ questions on teething issues they face in the area of warehouse management.

SKU that is ordered in larger volumes will have to be reIs there an advantage in having a Forward Pick Area? What about the wasted labor in replenishment? Does it make sense stocked more frequently but ordered in smaller volumes. Almost all warehouses store product in the forward pick as a concept? A forward pick area of a warehouse, also known as prima- area according to one of two philosophies: ry-pick or fast-pick, functions as a “warehouse within the n Give each SKU the same amount of space; or warehouse”. Most popular SKUs are stored here in small n Store the same time supply of each SKU (for example, amounts, so that order picking can be concentrated within store 3-weeks supply of each SKU). a relatively small area thereby reducing travel by order pickers and enables closer supervision. The trade-off is that the While building a warehouse, which one of these would you forward pick area must be replenished from a bulk storage recommend - PEB or conventional building structure? What or reserve area elsewhere in the warehouse which means are the advantages? Can I make structural changes in the that it can be used only if the warehouse can maintain re- future? serve of stocks. The pre-engineered building system is growing fast in conThe advantage of forward pick area is that it is the struction globally. With increasing need for building strucmost convenient from picking perspective. In general, tures and the high costs associated with their construction its deployment requires capital investment in equip- the conventional concrete structures are slowly being rement and additional space as it concerns the picking placed by pre-engineered. India's tropical climate provides of smaller quantities and hence involves sophisticated good insulation effects and is suitable for PEB. equipment than the picking activity taking place in the Pre-fabricated buildings are recommended because of bulk/reserves area. the following advantages:Since it is assumed that the entire restock quantity for 1. They are cost effective options when compared to a SKU can be carried in one trip, the labor for replenish- conventional concrete buildings. It can be designed as per ment isn’t considered to be wasted as the time for indi- requirements. The installation and maintenance of these vidual picks reduces. To minimize labor costs we must pre-fabricated metal buildings does not cost much. 2. Take shorter construction time: Pre-engineered metHere To account Helpfor both picking and restocking. The work to restock a SKU consists of the following components: al buildings are designed and built at the factory itself. With 1. Travel between the forward pick and bulk/reserve ar- all the pre-built accessories and fittings, the parts of metal eas: The magnitude of this cost is determined by the ware- building are transported to the building site. They are prehouse layout and not by the locations of individual SKUs. cut, pre-drilled and pre-wielded and can be bolted together 2. Travel within the bulk/reserve area to locate stock: at the building site within a short span of time with the help This is unpredictable because random storage. diagrams. Whether you are a warehouse manager, or aofwarehouse owner or justofa instructional supply-chain enthusiast wanting to know 3. Travel within the forward pick to theyou location(s) The pre-engineered can alsoonbethis set up on more about warehouse management, we have anarea expert can turn to3.every month for allbuildings your queries, to be restocked: A small component of the cost because a temporary basis for smaller industrial projects and page. Pooja Dayal, Head-Business Excellence Function, DIESL, will answer readers’ questions on teething easily pick area is relatively small part of the warehouse. be uninstalled upon its completion. The structure can be issues they face in forward the area of warehouse management. Because these cost components are either small or fixed reused also. with respect the decision of quantity store,multiple we take the mix different Structural changes inthe PEBsame building arebay. possible in the SKUs within storage I manage a fairlytolarge-scale warehouse thattostores number of restocks as a measure of the cost of maintaining designing stage itself and the supplier can be informed While this approach provides product segregation and to products for various sectors. I already have a WMS installed, the forward pick area. keep future expansion in mind. selectivity, it can result in poor utilization of space due to but would like to jump to a fully automated warehouse. How Before going for forward pick area consider the followThere are a number of companies offering services the honeycombing effect. At the other extreme, selective far can I take the technology at my warehouse? What are points:for racks construction of PEB buildings. Oneindividual should always pallet provide random access to each palmying options? Is there an off-the-shelf solution or do I need to check out for the authentication of company, the qualn Which SKU’s to store in the fast-pick area? let. But, the storage density associated with this storage look at customized ones? Will this help up my employees’ ity of structures it provides as per the International or n How much of each SKU to store? scheme is rather poor due to the wasted space in access productivity rates exponentially? Pooja Dayal Indian metal building standards and the cost they take n How large should be the fast-pick area? aisles. If you want to go in for complete automation you can Head-Business primary deciding factors. maximum value from a forward area, onesysmust as The quest for identifying the correct storage strategy look To at get AS/RS. Automated storage and retrieval Excellence stock it with the right SKUs. These are not simply the fast hinges on finding the optimum balance between Storage tems (AS/RS) are computer-controlled systems that put Function, DIESL Please mail your queries related to warehouse to stratmoving SKUs, because volume-ordered matters as well. A Density and Storage Utilization. The management best storage away, store and retrieve product in distribution cent-

<

Finding One's Space

18

ers, warehouse and manufacturing facilities. AS/RS are used widely in both manufacturing and distribution opINDIA | September 2011| www.logisticsweek.com erations to hold and buffer the flow of material moving through the process to the ultimate end-user. The shortcoming of conventional storage system like time spend for searching, lost or damaged products and

jayashree@logisticsweek.com

egy is the one that provides you with random/selective access to each SKU while providing the highest storage density and the highest storage utilization. There are various storage techniques like Conventional Storage, Single


< Cover Story

THE POWER OF CHANGE Maricoâ&#x20AC;&#x2122;s supply chain system is complex, but a trailblazer. Pamela Cheema reports.

SYAMPRASAD L Executive Vice President and Head Supply Chain and Manufacturing of Marico Ltd. 20

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< Cover Story

A

light drizzle falls gently on rain-washed streets as I step into the office of Marico Limited at Bandra, Mumbai. The grey overcast skies outside give way to brightly lit glass interiors and the cosy office of Syamprasad L, Executive Vice President and Head Supply Chain and Manufacturing of Marico. Gleaming trophies received for excellence in supply chain strategies are displayed in neat rows on the glass shelves above his desk. Marico, which is a leading consumer products and services group whose turnover for 2010-11 was `3128 crore, has a significant presence in more than 25 countries in Asia and Africa. One of the reasons for its global pre-eminence is its carefully thought out and well-devised supply-chain system which has not only helped to swell its profits, but has also assisted the company in breaching international markets, thus leading to unfettered growth. In an affable manner, Mr Syamprasad lays bare the innards of his company’s supply chain system and traces its development from a system which the corporate fol-

lowed earlier (the forecast-based system), to one which is more effective (the replenishment mode) that helped it to metamorphose into a lean and responsive supply chain system. The logistics strategies of the company have thus given it enviable reach and enabled it to hoover up a vast and ever-expanding market.

to replenishment Marico Limited introduced the replenishment mode of supply chain in 2002-03 and to enable its efficiency, started collecting secondary sales data. The change occurred in two phases—in phase one the ball was set rolling by the then CEO, Pradeep Mansukhani and Head of supply chain, Vinod Kamath. Phase two saw a strengthening and consolidation of the system under the present CEO, Saugata Gupta. Says Mr Syamprasad: “In 2009 Saugata began changing the supply chain under a supply chain transformation project. It was his dream to put together a supply chain organization which would have ‘zero sales loss’ that would be obtained at the lowest Total Delivered Cost (TDC). We decided to make the entire sup-

Why route optimization? Is there a need to apply a science behind route formation process?

Cluster Formation Structure clusters to service beats efficiently

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Cluster Optimization Ensure homogeneity in clusters

September 2011 | www.logisticsweek.com

Efficient number of outlets How many outlets a DSR can serve?

ply chain visible, so now more and more people are aware of where the stocks lie and how the supply chain progresses.” Marico defi nes its primary sales as goods sold by its depots (the term used for warehouses by the company) to its direct distributors. Secondary sales are goods sold by its direct distributors to its retail channels. “In FMCG secondary sales is the pivot on which the entire planning exercise is based,” emphasises Mr Syamprasad. “This is exactly where sales happen and replenishment based on data from sales to consumers is more accurate than sales from depots to distributors. If I may add, this is one of the fundamental changes in our supply chain system. In various industries we have noted that primary sales are often fudged sales, typically happening at the end of the month to show that a particular sales target has been achieved. But it is secondary sales which indicate a far more evolved system, wherein the distributor sells to the retailer, so that really is true sales.” The element of transparency is a prominent characteristic of secondary sales and is an accurate reflection of what is actually ‘pulled’ in or bought by retailers and hence a mirror image of genuine sales. Secondary sales data is channelized by unique methods to the company. “We are pioneers in this,” smiles Mr Syamprasad. “Marico has given its distributors a software, Midas (Marico distributor automation software) which has the data of current inventory levels, how much stock the distributors are receiving, how much they are selling and to which retailers, the number of SKUs, the discounts being offered, etc. All this data is transferred on a daily basis to our internet site, Minet, which is also specific to Marico. Thus we have information at hand on a daily basis.”


< Cover Story

Marico Limited’s supply chain system while being complex, is a vast, eyepopping value chain which penetrates deep into urban and rural areas. Influencing Stakeholders But to ensure that the system worked, Marico was compelled to work overtime to convince its distributors to buy its software. The distributors were not breezily bullish about the new software. “In fact, there was a lot of resistance from them,” laughs Mr Syamprasad. “Some of them were even convinced that they would be sidelined after buying the MIDAS software because it would

lower their inventory levels. We had to put in a lot of effort to convince them about the efficacy of the software, how the data would help them, how it would enable their overall efficiency, how their margins would improve. But once we started influencing them, the distributors began using MIDAS and worked with us.” MIDAS was incorporated in the supply chain system of the company in 2002-03 along with SAP R3 another IT software, introduced in 2001-02; both IT systems strengthened the technology base of the company and ensured its profitability.

Deep Penetration Marico Limited’s supply chain system while being complex, is a vast, eye-popping value chain which penetrates deep into urban and rural areas. The company has 350-plus raw material and packing material vendors who supply to eight plants and

A group picture of some members of Marico's supply-chain team at its Head Office, Mumbai.

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12 sub-contracted locations. The finished goods are transported from these plants to depots (warehouses). From the depots the finished goods move to the company’s direct distributors and its modern trade distributors (these are distributors who are contracted to individual retail chains like the Aditya Birla chain or Big Bazaar). From the direct distributor the goods are supplied to the retailer (in case of urban areas) and are then sold to the consumer. In rural areas, the goods are transported directly to super distributors (they have a huge network which work these areas) who in turn supply to stockists, who forward the goods to retailers. The retailers sell to the rural consumer. The corporate has 750 direct distributors, 135 super distributors and 3,844 stockists. It has no sub-stockists. Marico also has an enviable figure of 6.6 lakh retail outlets in the




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Answers for industry.

s


< Cover Story

"our distribution network is one of the strongest in FMCG. In fact, earlier MNCs like Proctor & Gamble and Indo Nissin Food Ltd (INFL) would piggyback on our network to distribute some of their products." country. “Our distribution network is one of the strongest in FMCG,” says Mr Syamprasad proudly. “In fact, earlier MNCs like Proctor & Gamble and Indo Nissin Food Ltd (INFL) would piggyback on our network to distribute some of their products.” The figure of 6.6 lakh retail outlets which distribute Marico’s products refers to the direct coverage of the company—in actual fact, Marico penetrates even deeper into the consumer market. “While it is true that our direct reach is limited to 6.6 lakh retail outlets, our actual reach is even greater,” explains Mr Syam-

prasad, “because from these outlets our products get distributed to very, very small outlets, so our complete reach would really be in multiples of 6.6 lakh outlets!” The company has two hair oil factories located in Dehradun (Uttarakhand) and Paonta Sahib in Himachal Pradesh, while its depots are strategically spread out across the country in cities like Delhi, Kolkata and Bhiwandi. Marico has 34 depots of varying dimensions and three coconut oil manufacturing units in business-centric locations in the country.

Zero Sales Loss While the objective of the refurbished supply chain strategies of Marico has been ‘zero sales loss’, the company admits freely that it has not yet been achieved. “That was a vision,” notes Mr Syamprasad. “Basically, the vision was that if a consumer goes to a shop and intends to buy one of our products, he should find the product in the shop.” The corporate has endeavoured by other methods to ensure that products desired by the consumer remain readily available on the shop shelf. The sales and marketing team supply

Marico's GeN-Next Supply Chain AS-IS Order based RM/PM Procurement System 1-2 Days of Inventory at factory A Push based despatch system for Primary Distribution Order based system for NVMI and Replenishment system for VMI Distributors

RM-PM Suppliers

4-6 days of Inventory at Factory

Factory

A Pull based Factory to Depot Replenishment system

RDC Depot Distributor

More Responsive and Connected Supply Chain

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TO-BE VMI-Pull System for Key RMs and PMs

September 2011 | www.logisticsweek.com

New initiatives Like DDR (Daily Dist. Replenishment) For Metro Distributors

the retailer with the stocks he has ordered. But if the stocks ordered by the retailer fail to reach his shop, the supply chain is set into motion swiftly to correct the deficit. Even more importantly, Marico has discovered, through what it terms a ‘surrogate’ method, a corelation between distributor service levels and retail stock-outs. “Based on this, we get to know that if we increase the distributor’s service level what will be its actual impact on the retailer’s stock-out,” elaborates Mr Syamprasad. With its newly-minted methods, the corporate has been able to effect an improvement of two and a half to three percent in its distributor service levels and this has translated into a substantial reduction in sales loss of nine to ten crore. But is the high-buzz figure of zero sales loss possible at all? Mr Syamprasad demurs. “The service level at the distributor’s point cannot be 100 percent. To give 100 percent service level, the inventory in the system has to be abnormally high. Now that does not make sense for Marico or any other partner in the chain. What we are looking at is the right level, where you are making money for all the partners in the chain and at the same time, you don’t default on sales at the consumer’s level.” The corporate has realized that while 100 percent zero sales loss will always remain a chimera, 97 percent zero sales loss is a realistic and smart possibility. After 97 percent, costs shoot to stratospheric levels and Marico would be compelled to maintain an excessively high inventory with abnormally huge levels of wastage. “Therefore we call 97 percent our zero sales loss”, says Mr Syamprasad emphatically.

All-round Improvement With a supply chain system transformed in such a dexterous and thorough manner, every aspect of Marico has been touched by im-


provement. Product freshness, the company’s topline and the responsiveness of its supply chain have appreciated considerably. According to Mr Syamprasad, in the last couple of years there has been a substantial increase in the distributor service level and the range service level (this is defined as the availability of all the SKUs in the portfolio). “Our achievement is an improvement of above 90 percent distributor service level,” he notes with pride. “Along with this, we have also focused on daily distributor replenishment and factory to depot replenishment. All these projects have further improved the availability of our stocks at the distributor and retailer level.” Along with the substantial improvements in the distributor and range service levels, Marico also envisioned another project, bulk breaking, which would further trim wastage in the company. The project of bulk breaking has immeasurably reduced wastage as the company avoids sending its products in full unitization or complete cartons to all its distributors. “Wherever our products move fast, we send full cartons, but wherever sales are slow, we send just a few pieces of our products, not full cartons,” shrugs Mr Syamprasad. “This improves range availability as well as the freshness of the product. It has also reduced leakages and damages to the tune of 10 percent-15 percent.” With the diverse methods employed by the company, the distributor value fill rate, which is already high, has improved by a further four percent, service levels to the canteen stores department (CSD) has improved by five percent making it among the best in the FMCG sector, while the return on investment of distributors has increased radically. The stock freshness of Marico’s products reflect a marked improvement by ten to 60 days at various distributor locations.

No Stock-outs, No Surpluses With the aid of its refurbished supply chain system, Marico has attempted to guard against stock-outs and stock surpluses which could decelerate the growth of the company. The corporate has attempted to consolidate its inventories at every node of its supply chain to get economies of scale. Explains Mr Syamprasad: “Let’s say my distributor has 15 days of inventory and my depot 10 days of inventory. So the total system has 15 days of inventory, but that number will be distributed across N number of distributors. Inefficiencies can still crop up, but if you consolidate inventory at an upper node, you can achieve the same high level of service, but with less inventory. So we have applied this consolidation at higher nodes too.”

Factory to Depot replenishment Consolidation has been achieved with the assistance of several new

strategies, one of which is factory to depot replenishment (FDR). Factories dispatch goods to depots according to their rate of sale. The depots which sell more stock receive more goods, while the ones which sell less products, receive an appropriate quantity of goods. Factory replenishment ensures that inventory norms are maintained at the depots daily. If inventories dip at any depot, a lag is created between target and actual inventory. “This information of gaps is then collated for all depot SKUs on a daily basis,” says Mr Syamprasad authoritatively, “and it becomes my dispatch platform. Then whatever dispatch plan I get is netted off against the factory finished goods available.” This method helps to rationalize inventory in the entire system, reduce it and has enabled Marico to achieve high levels of service, with appropriate levels of inventory, at desired levels of cost optimization and with complete efficiency.

Marico's Supply Chain transformation Factory to Depot replenishment

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< Cover Story Depot to Distributor

Daily Distributor replenishment

Daily Distributor replenishment Another method which has enabled Marico to ramp up its supply chain strategies is its patented method of daily distributor replenishment (DDR). The company professes to be a pioneer in distributor replenishment and is attempting to refine the system further. When the corporate set about changing its supply chain system, it hit upon the idea of lower inventory at the distributor’s level. This required a wrenching change of mindset, with most distributors fearing that service levels would plummet if inventory was lowered. “We had to tell them that earlier you had small storage space and limited stocks, but now you have access to the entire depot’s stocks,” smiles Mr Syamprasad genially. “Now we are going to give you access to 100 percent of our stocks. This will only improve availability and freshness of your stocks. Some of them were even afraid that

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we were sidelining them!” To achieve its target of distributor replenishment, Marico made a few innovations at its backend. Depot norms were increased and products were never shipped to the distributor unless they were required. Also, while the retailer has a cycle of ordering stocks on a weekly basis, a date is fixed for taking his orders depending on the retailer or the distributor’s convenience. Elaborates Mr Syamprasad: “The retailer normally carries stocks which last for almost 25 days. What we now do is if he orders stocks on say, a Monday, we give them to him on a Wednesday. Earlier, we would give them on a Tuesday. With this, the stock-out

Some of the supply chain team members at Marico's Head office, Mumbai: (l-r) Baiju Mohan, Girish Iyer, Syamprasad, Bhushan Bannur and Nitin Kathuria.

September 2011 | www.logisticsweek.com

system at the retailer level is rare. It may happen in the case of a new product, but where old products are concerned like Parachute hair oil, the demand is well-mapped.” Most distributors have been given MIDAS (Marico Distributor Automation Software) which has been developed specifically for Marico and into which they key in diverse details like current inventory levels, sales figures, etc. which is visible to the company. On the other hand, the distributor sales representatives (DSR) accept orders for all SKUs from retailers. The retail orders are synchronized between the distributors’ MIDAS and the PDA (personal digital assistant) carried by the distributor sales representatives. These systems generated orders are created at the depot. Thus the depot directly services the retailers’ orders to the distributors, which results in greater availability of stock as the aggregation of stocks is done for the entire city at the depot. With a supply chain which has attempted to arduously iron out all the wrinkles in its system, Marico’s distributor fill rate (for its DDR distributors) has bumped up by nearly five percent and


its distributor inventory levels have fallen dramatically.

route optimization However, Marico’s complex and highly evolved supply chain strategies would have been incomplete without a careful restructuring of the beats on which its distributor sales representatives travelled and the business they achieved. “We wanted a high degree of route optimization,” says Mr Syamprasad choosing his words carefully, “ because we wanted a maximum utilization of distributor assets, both in terms of transport and manpower, as well as the business done per day or per month. We looked at all these parameters, the number of orders per day, the number of DSRs used, the distance covered per day by vans, the business per beat.” Using time and motion studies and the PDAs of the distributor sales representatives, the amount of time taken to cover per beat was calculated. With the information garnered from these studies, a scientific realignment of routes was done according to clustering and boundary outlet princi-

ples. The route optimization resulted in tidy savings to the company, which underscored the success of its new innovation.

Streamlining It Systems But none of these refurbishments of the supply chain would have been successful without a complete streamlining of the information technology systems of the company. The IT systems that Marico is currently using are similar to what was in use earlier when the corporate adhered to the forecasting model of supply chain. The distributors were given handheld devices even in the past “but the difference is that now the data is being collated and sent directly to the depot level,” Mr Syamprasad is quick to explain, “on the basis of which stock moves directly to where sales are happening. So we have the PDA which is an IT instrument, MIDAS, Minet and our SAP R3 and all this is the basis of our IT systems.”The company invested in these information technology systems in 2002-03 and an in-house team of IT experts has leveraged these systems to the immense benefit of the corporate.

With the integration of its various It systems, Marico has achieved the singular distinction of being able to view daily its retailers’ orders at a company level. With the integration of its various IT systems, Marico has achieved the singular distinction of being able to view daily its retailers’ orders at a company level. At the corporate level, it is now possible to know the retailers’ orders, which in turn has transformed demand planning into a seamless and effective cycle. Over the years Marico has consistently been the recipient of several awards, among which are the ‘Food supply chain innovative company of the year award’ presented by KPMGSupply Chain Leadership Council at their Food, Retail, Logistics and Packaging awards in 2010 and the ‘Best strategy innovation in supply chain’ awarded by the India International Logistics Forum in May 2011. The company has achieved much with its painstakingly reworked and carefully devised supply chain strategies—it now offers higher service levels at lower inventory levels and it has firmly established the replenishment based system across all the nodes of its supply chain system. With good ideas bubbling to the top, the company reinvented its collaborative relationships with its business associates, like its distributors, with salutary benefits all around and also radically altered its beats to ensure route optimization which has netted the company substantial rewards. Good times appear to be rolling for Marico whose only route seems to be up. INDIA |

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< case study

KPMG has brought out a compilation of case studies of companies that have ardently embraced innovation in their transportation and logistics, also warehousing. the paper, adding Wings, highlights the efforts that companies have put into innovating and creating an unparalleled transition to realize their dreams. LOG.India will publish a case study at a time. an exclusive.

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of this segment can be gauged from the fact that the apparel volume that moves through the retail network is much more than that of all other branded fashion apparels in India put together. Large and growing volume across a large and a widely spread retail network has added significant complexity to their distribution operation.

Problems Faced

F

uture Retail is a leading retailer in India in the organized segment, operating various brands such as Big Bazaar, Pantaloon, Food Bazaar, Central and eZone across India. The company has a massive footprint in the Indian retail market, with a turnover of about Rs 95 billion (2009-10), about 16 mn sq. ft. of retail space and over 1,000 stores spread across 80 cities and 60 rural centers in various formats. Fashion and apparel has been one of the main growth drivers for the business and a sense of the scale

One of the key questions facing the company was how to achieve higher throughput from the warehouses managed by the 3PL service provider, Future Supply Chain Solutions (FSCS). Business projections for the company were signif icant, both in terms of absolute quantities that had to be handled by the warehouses and the number of stores to be serviced per warehouse. With the bigger warehouses already servicing over 40 stores and alongside increasing projections, the challenge was enormous. FSCS already had a Warehouse Management System (WMS) which was helping it with in running the operations at such large volume levels. It was now all pivoted around increasing efficiencies – handling huge volumes, achieving fill rates of 99 percent and ensuring dispatch accuracies to 100 percent – all of these to be achieved at an optimum cost. Further, there were multiple categories of products to be handled with each category having its own supply chain needs. The other critical challenge was to deal with peak volumes during the August 15 and January 26 sales promotion events announced by the company. For instance, the average picking of 30,000 apparel pieces per day under normal sales days was to increase three-fold at one of the warehouses. This translated into increasing the number of

pickings to three to four times the normal capacity (with additional labor) without compromising on outbound accuracy.

analyzing data To resolve the complex challenges faced by the company, FSCS analyzed the detailed data on the various parameters such as current order volumes, number of Stockkeeping Unit (SKUs), inventory in process, number of end locations to be serviced through a Distribution Centre (DC), etc. Accompanied by this analysis and possessing a domain understanding of how each product category behaved through the supply chain, FSCS decided that it was the apparels category where new technology was needed to handle the challenges, particularly picking and sorting. For picking, FSCS already had WMS. However, in a scenario with huge volumes and a higher number of outlets per warehouse, batch picking was imperative, and with batch picking, physical sorting capacities needed to go up manifold. FSCS then started to look at the available technologies that could help increase the sorting speed drastically and at the same time improve the accuracy of the goods processed. Another set of factors determining the technology to be used were cost, reliability and scalability - all at the same time. To arrive at the best suited technology, FSCS evaluated multiple ‘sortation’ systems such as Ring sorters, Bomb Bay sorters, Cross Belt sorters, Pick-to-Light systems and Put-to-Light systems among others. Finally, Put-to-Light (PTL) system was selected because of its effectiveness in the given scenario on all the critical requirements discussed above. Also, this was a simple system that required minimal training for the user at the INDIA |

September 2011 | www.logisticsweek.com

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< case study lowest level, an important factor in the Indian context. Further, to doubly ensure accuracy especially during the peak days, FSCS integrated the PTL with a Print & Apply system which ensured that the packed boxes were subjected to a weight check and were rejected if the check failed. While addressing these processbased improvements, FSCS had to overcome several challenges such as those in seamless technology integration with the WMS, coordination with multiple vendors and the expected short turnaround time for implementation. Owing to timely resolution of all these issues, FSCS was able to implement PTL within a short span of five months (May 2010 â&#x20AC;&#x201C; September 2010) across five large warehouses.

Outcome and Impact As expected, there were visible improvements in productivity and efficiency: while processing capabilities in terms of sorting and packing the pieces increased three-fold; batch picking efficiencies also increased as sorting was no longer a bottleneck. This meant that with the same resources, FSCS could now pick, sort and pack at thrice the earlier pace. Further, while the outbound box capacity utilization increased dramatically to almost 100 percent, up from an average of 80 percent, the outbound stock accuracy increased minimally at first and then kept on improving as the staff became increasingly conversant with the new technology. Although this improvement was initially triggered by the WMS, the

In a scenario with huge volumes and a higher number of outlets per warehouse, batch picking was imperative, and physical sorting capacities need to go up manifold.

accuracy improved further despite the increasing volumes. Next, visibility in terms of inventory at every stage increased. More detailed and frequent Management Information Systemsâ&#x20AC;&#x2122; (MIS) reports could now be generated as more measurement systems could now be placed at the critical steps. This enabled the warehouse management to take immediate corrective actions where necessary. Moreover, the ease of training resulted in fast roll-out of the technology, while the scalability ensured that the increasing number of stores mapped to any DC was not a challenge anymore in terms of picking and sorting capacities. The other advantage was that the adopted measures relieved some labor bandwidth. FSCS could now deploy more staff in inventory management to ensure stock accuracy through continuous cycle counts. Also, exception management now got its due focus. Anshuman Singh MD and CEO, Future Supply Chain Solutions

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< EVENT TraNscripT

In The Right Doses In June, LOG.India choreographed Pharmaceutical and Healthcare Supply Chain - What Works - an event to understand the finer nuances of this vast multi-billion dollar industry. A transcript.

Prof. Saral Mukherjee (left) lights the traditional lamp

Date: June 24, 2011 Event: Pharmaceutical & Healthcare Supply-Chain Organizer: LOG.India Venue: Hotel Hyatt Regency, Mumbai

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T

here is a consensus among the pharmaceutical fraternity, especially its supply-chain, that companies work only towards the month-end. So what are the issues with the supply-chain? A few top notch managers give an insight into the workings of the pharma supplychain and what needs to be done to improve the situation.

September 2011 | www.logisticsweek.com

Track 1: Collaboration: The roadmap ahead Prof. Saral Mukherjee, IIM Ahmedabad I come here bringing my experience in supply chain management across different sectors. I would like to ask the people in this room: What is a supply chain? Transporting goods to the end cus-


tomer is supply chain? Meeting the customersâ&#x20AC;&#x2122; demand, I thought was marketing job. Then what about sales? Movement of materials used to happen when Henry Ford had produced the Model T car. Did he have a supply chain? Supply chains existed, materials flowed, but the word was not there. Henry Ford had a very demanding customer; he was looking at a cost which was so low that even a worker in his assembly line could afford a car. Customer demands have always been there. Think of this, the core of SCM is the word coordination. Physical supply was there even before Henry Ford. Even a village potter makes a pot, takes it to the village haat and sells it in that fair. What matters most is coordination across entities. If we have coordinated across entities, then we can call it a supply chain management which is happening. Henry Ford had a completely integrated supply chain because he owned not only the steel mill, but also the car factory. We are now talking about two different ideas: ownership and control. We are saying SCM is a situation where I can coordinate even when I do not own the asset. To coordinate, I need not own. We have to move from a pure transaction-based situation to a partnership-based situation because if I am going to seek control of my planning, I cannot do it at the transaction level. Why should I partner? What is in it for me? Partnership, as someone said, should not happen between competitors. I cannot think of a monopoly in pharma sector or health sector. If I have to live with them, why canâ&#x20AC;&#x2122;t I collaborate with them? People have been talking about the bottom of the pyramid for a long

time. People are now talking about extreme affordability. A group in Stanford is working right now on extreme affordability in terms of housing. And the target is $300 for a house. Extreme affordability for us in India is a need. How can I go to the bottom of the pyramid, which in India is the rural areas? If I have to have collaboration with my competitor going into the hinterland, I need a third party vendor to do that. And the third party cannot be the unorganized sector warehouse. Rewrite organizational policies. I was visiting Saurashtra for a beverage major. Every convenience store I went to, I saw potato chips of a particular vendor. Turns out, this potato chips vendor is an original distributor of this beverage major. He has diversified. A truck has two constraints: a weight constraint and a volume constraint. The same two firms are going to the same rural outlets with two different trucks. How much would it take to reduce that weight there and just put in volume so that I have a joint optimization on both? This will not be possible. Why? Because the beverage major has an organizational policy written at the headquarters level, may be global headquarters level, which would say you must have specific assets.

Track 2: Presentation: Data Driven Distribution Sanat Shirali, Director Business Development, AIOCD The FMCG industry is a hallmark as far as supply chain and data collection is concerned. It offers high visibility at the retailer level, though little at the distributor level. Replenishment-based supplies are based on secondary sales projections. Production planning is based on secondary sales and

Prof. Saral Mukherjee.

inventories. This is still far off for the pharma industry. What are the benefits the FMCG industry accrues? Because of this data they have reduced inventory, increased revenue, accrued higher gross margins and have better forecast accuracies. As far as materials suppliers go, they have reduced inventory because material suppliers are forewarned. They have lower warehousing cost because they can make it optimum. And as far as the service suppliers go, you can see lower freight cost, faster deliveries and lower fixed cost. Pharma is at the level of the stockist, while the FMCG is at the level of retailer. Stockists order require a visit by an MR to prepare an order, whereas, orders for FMCGs are managed electronically. The second point is the pressure on primary achievements, which leads to malpractices. INDIA |

September 2011 | www.logisticsweek.com 35


< EVENT TraNscripT Dumping at the month end is phenomenal in pharma. Recently, I met a group of stockists and the general consensus was that the pharma industry works only on the last 4-5 days of the month. Of course, the pharma industry works all days, but it’s visibly seen on the last 4-5 days,

Sanat Shirali.

by the stockists in particular. Let’s analyze the supply chain problem. The pharma sector dispatches to CFAs based on primary sales, which could be highly distorted from what the demand is. The FMCG dispatches are based on replenishment-based demand and also done scientifically. The majority of orders for pharma come in during the last week. So demand and workload at the CFA is acute. The pharma industry plan their production based on historical primary. The FMCGs work on backward integration and automatic batch scheduling. One of the pain points for the pharma supply chain is an inventory imbalance at the stockist level, because of lack of data in time. There is also an inventory imbalance at the C&F agents because the forecast is based more on targets than on demand. Then there is the question of high expiry of goods. The planning of production is based on primary data, because there is hardly any authentic secondary sales data.

Daryll Mascarenhas. 36

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The expenses by way of freight for last minute moving of goods due to month-end closing figures is high, but it’s important that numbers are generated. There is loss of sales despite adequate inventory. How do we make that transition from the current to the ideal? The solution is to obtain stockist sales and inventory data in timely and regular manner. And this should be cost effective. We have a solution in the EDE (electronic data exchange), where we maintain stockist sales statements electronically.

Track 3: Inventory Check: Enhancing the S&OP process to improve forecasting and optimize inventory levels. Daryll Mascarenhas, GM (Supply Chain), GSK Pharmaceuticals I call my presentation ‘Through the looking glass’ because it’s a question of how you link a strategic process to something starkly operational. We use sales and operations planning (S&OP). The true goal of S&OP is to align strategy of the enterprise with the operations in terms of what the enterprise is trying to do on a day to day basis. It’s still S and OP, which means the S is very small and that’s intentional. Sales have no role in the operational planning process. So it’s driven by the operations managers. Very few organizations actually saw things like consensus forecasting or even in terms of KPI measurements as something that was important for S&OP. The other point again is the use of software. What kind of software do people use when they go with S&OP? People use a mixture of spreadsheets, vendor developed software, ERP, ERP-enabled S&OP software, so on and so forth. How does inventory fit into the S&OP piece? According to the APICS Dictionary, inventory is those


stocks which are used to support production. And this is where the link through S&OP drives. Is S&OP financially oriented? I think it is. Should it be? I think it should be. But not financially driven; it should be finance-oriented. The only good reason to carry inventory beyond current needs is if it costs less to carry rather than not. Now this is what most often happens and doesn’t get measured. And S&OP is a kind of forum where these things can be brought together effectively. The replenishment process in most cases is called, very simply, as plan and mange inventory, which means that the entire purpose of S&OP can be brought down to planning and managing your inventory buffers because your inventory is what sort of really keeps you going throughout the days. The other areas in sales and operations planning which impact inventory are demand and supply planning. One of biggest problems in demand planning or demand forecasting is overemphasis on accuracy. And this is what happens when you do it in isolation. Sales tells you what is going to be, so there is no question of forecasting. Demand planners land up being just accounting clerks. It should not be one department’s opinion, that’s what S&OP says. The problem with supply planning is over emphasis on synchronization and productivity. So what happens is the supply planner tries to make sure the capacity is utilized in the best way possible. So you need a plan which balances out the loss of capacity utilization of productivity versus the cost of losing sales or the opportunity in business. Without S&OP, you have moving targets, because no plan lasts. If S&OP has to work, it should be led by the CEO, or CFO, but nobody other

than that. Leadership has to come from the highest level.

Track 4: Temperature-controlled supply chain B Raveendran, Director (Global Logistics), MSD Pharmaceuticals; Jagdish Gohire, Head (Logistics & Trade Compliance), MSD Pharma P Raveendran: There have been so many theories about supply chain and what works and what does not work. But I say that it better work because if it doesn’t work then we are not in the business. I am going to talk about cold chain products which is going to come in a big way as far as India is concerned because as per projections, it’s vaccines that takes the cake. Among the cold chain products, the market is going to be 100 billion by 2024. Companies are growing anywhere between 15-30 percent in the vaccine market because the government is showing a lot of interest and as well as there is a private market for this. We are talking about the commodity flow. If you look at the commodity scenario, as a country there is phenomenal waste of products. When it comes to pharmaceuticals, today all companies are equipped to some extent to deal with it because of the constant training and the inputs given by companies. About 95 percent of pharma products are sent through the trade route. We handle almost close to 80,000 stockists, 32,000 sub-stockists and from there it goes to more than 500,000 retailers. There is a grey area here. Nobody knows who the sub-stockist is. And imagine a cold chain product going through a sub-stockist —because he doesn’t even know the product. The maximum control is up to the CFA. We got a product imported. It was at the airport for more than three

B Raveendran.

Jagdish Gohire.

days. Although we have temptales, while loading one temptale, we found that it was not as required. The loss to that company is almost $1 million. We had to destroy the stock. It’s our responsibility that when the product reaches the end customer, it should reach with integrity. Actually when you start off a cold chain facility, what one has to look at is how to set it up. The stockist should have a proper back-up facility. All of us have a back-up facility, be it a generator or battery back-up. Over and above, one needs to look for other solutions that will allow INDIA |

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37


< EVENT TraNscripT

From l-r: Prof. Saral Mukherjee, Reena Gor, Jigar Mehta, Daryll Mascarenhas, B Raveendran.

you to store the goods and hence offer a grace period of an additional 48 hours. Jagdish: What should we do when a cold chain breaks down? Find out the root cause and ascertain the time period whether it will last for more than three hours or not. We have observed that inside the walk-in cooler whenever temperature mapping is done, the temperature generally remains within the limit of two and a half to three hours. Supposing it is a weekend. What we should have is continuous temperature monitoring devices. So temperature is monitored at the warehouse on a continuous basis and whenever there is an excursion, immediately an SMS message will go to the concerned people in the company and appropriate action can be taken. While dispatching stocks, ensure that the packing is sturdy. There are various packaging solutions available in the market. One is called Gaylord boxes. For bulk products, we shrink-wrap the product. Jagdish: Containerized move-

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ments are meant for domestic or oceans. Refrigerated vans are the safest means of transporting cold chain products. Jagdish: The first level of control is the stockist. So bring in the right person on board. We can then set about to acquire market information from the stockist whether they are ready with cold chain facility, knowledge of cold chain products being handled, storage facility, etc. The second method by which we can maintain control is education. We need to go up to the level of educating that inside the refrigerator nobody should turn the buttons that determine the temperature control to be maintained because changing the temperature range can impact the product. Have customer friendly and informative packaging. One kind of packaging we have seen is using an indicator to the end user, which says that if the box is clearly visible, the product is good to use. Another kind of packaging is 3M Freeze Watch Indicator. What is used globally is 3R strat-

September 2011 | www.logisticsweek.com

egy, which is basically, reduce, reuse and recycle. This strategy can have minimum impact on the environment because of the extensive use of Styrofoam.

Track 5: Panel Discussion: Visibility of Cold Storage Supply Chain n

Reena Gor, CEO, SK Logistics

n Jigar Mehta, Partner, Amritlal Bros n Daryll Mascarenhas n B Raveendran Moderator: Prof. Saral Mukherjee Saral: If we have to have visibility of the cold chain supply chain, what are the issues? Daryll: The most neglected area in setting up a cold chain is the facility. Is it enough to put two or three temperature monitors or do I need a seven day or ten day mapping by the book? The second challenge is the end-to-end monitoring of the cold chain. I am talking about the dealers and the stockiest. All of them have cold rooms. But are they mapped? A bigger issue is the last mile. Reena: We have been observing that


< EVENT TraNscripT drivers of the vehicles are not are unaware that the vehicles they switch off when it's stationery makes the excursions starts. I would like to request government bodies at airports (as imported vaccines are cold chain products) to give aggressive clearance to cold chain products. Saral: There is a need for educating the drivers. But who is going to take the onus? Because training of this kind needs money. Raveendran: Actually the complete ownership is with the company. There is a general feeling that the CFA is established to reduce cost. However, a CFA is established for flexibility and for more focused customer service because that is the main aim of a CFA. Saral: In your experience, do you see different segments within the retailers in terms of how they look at this issue of excursion? Jigar: In the Mumbai market, retailers are aware of the cold chain products and know how to safeguard them. Saral: If I am a retailer who is not following policies, you know you’ll not

find me out. Why should I follow the policies? Daryll: When we talk about cold chain we talk about 2-8 degrees. Where people really ignore is the 1525. If you see in any retail or chemist shops where these products are stored, which says store below 25 degrees, it will be stored in 45 degrees heat. Saral: External pressure is a double edge sword. But what about self regulation? If I am providing high quality, it must be seen that I am providing high quality. Let’s say there is an incident with a particular retailer, would the other pharma companies come to know about it? Raveendran: If the product is substandard, there is a mechanism to check that. But that is not every day. Percentage wise, only 10 percent maintain it, 90 percent do not.

Track 6: Partners in Progress: Choosing the right LSP n Jeevan Raosahib n Arif Siddiqui, Director, Coign

Consulting n Rohan Shah, CEO, SK Logistics n Rahul Agarwal, MD, Bhoruka

Logistics Moderator: Aanand Pandey, Editor, LOG.India Aanand: Mr. Siddiqui, why is it important for a company to choose the right LSP? Arif: Why is it so important to choose a right better half? Fundamentally, the process that you go through while selecting an LSP is the same as choosing an expert in an area that is not core to you. The second aspect is because one feels one will not be able to leverage over one’s own investment on the infrastructure. The third reason to outsource is that you expect the specialist to continuously be involved in the process of augmenting technology, in the area of infrastructure, resources and skills, which becomes critical to the evolution of the chain. Aanand: What are the processes in selecting the right partner? Arif: First, the capability and the skill sets. Secondly, does that organiza-

From l-r: Aanand Pandey, Jeevan Raosahib, Arif Siddiqui, Rohan Shah, Rahul Agarwal.

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< EVENT TraNscripT

A part of the audience.

tion have the resources, both in terms of infrastructure as well as in term of soft skills or in terms of people skills to be able to deliver that? And the third important part is, does that organization have the will to invest because logistics involves finance. We’ve been hearing of cold chains, technologies, temptales, etc. That’s just the tip of the iceberg. There are thousands of other investments; buildings, insulation, ranking system, material handling, equipment and the works. Also do they have ability to innovate? Going forward, supply chain relationships will be about partnerships because the challenges of the pharma industry as discussed here is the level of our control up to the stockist and very few answers available beyond that.

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Aanand: Do the LSPs in this domain have a willingness to invest when it comes to the relationships with their principals? Rahul: If you look at the situation in the 90s and now, the LSPs who are catering to the pharma industry now have invested a lot of money. Pharma products are sensitive in nature and the LSP should be careful when transporting – they take on various forms. Aanand: So you are saying that it’s the willingness to invest in terms of education? Rahul: Education, because I can invest in lots of fleet, but if my people are not trained then a lot of those investments could go waste. Aanand: Mr Raosahib, so what are the investments that LSPs are willing to make? Jeevan: The involvement we have

September 2011 | www.logisticsweek.com

with the companies is in the areas of freezers, data loggers and IT support. There is a need for us to be partnering with the customer. And with that kind of involvement, we would like to make this a platform where we can collaborate with a customer to bring him more business. Aanand: Mr Siddiqui, how do you define an ideal relationship? Arif: Define expectations. In India I’ve seen that a transporter or a warehousing 3PL, etc, spends 70-80 percent of the time in fire-fighting, which is not required. As a result we appoint customer service agents or customer service executives, who are not doing anything but tracking shipments or expediting the speed of the shipment just because there is a very short lead time given for movement.


Aanand: What are major pain points? What are the areas that LSPs lack? Arif: The complaints should be in the area of non-delivery. I am talking about non-delivery of expected SLAs and the required KPIs. If an LSP is not able to deliver, then issues will come up. Aanand: LSPs are squeezed for margins. So what would you expect on the part of the principal? Rahul: The LSP and principal should sit down and extract data for last six months and establish the norms and praise where necessary. Arif: One is the overall aspect of strategic fit. Strategic fit is basically the fitment of the business strategy to the supply chain strategy. And if this strategy actually fits in with each other, like for example, the Walmart strategy says that can’t be cheaper than today. So if Walmart says that you can’t find it cheaper anywhere

than them, then the finance person who is actually buying finance for Walmart can’t go and buy finance at a higher rate because if he buys it at a higher rate, it will mean that the product will also sell at a higher rate. The problem largely is the disalignment of the supply chain strategy with the costs or the finance strategy. And we have seen that whenever all these departments sit together, it is just a way of finding solutions to the relationship. The second point is reducing the commercial obstacles that exist in contracts. When commercial obstacles exist, it deters the smooth flow of the relationship and the operations. Aanand: It’s apparent that LSPs are caught between giving a low price service and having to deal with high level of commitments. Mr Siddiqui, give us the principal side of the story, why are they so afraid of LSPs in India? Arif: The principal’s perspective is that he doesn’t get that feel of credibility from the LSP that he is a specialist. Until you go up the value chain from being a service provider to a value service provider, you’ll never be able to get that credibility. How many LSPs go back to the principal and suggest that if you do this little bit differently you are going to save two percent of your cost? How many CFAs believe they are in the business of supply chain and logistics? And whenever I speak to a CFA, I say that you are actually a supply chain service provider; it is news to them. Patil: Whoever is working for us is not an outsider. We’ve outsourced most of our activities and we do share information with them. Aanand: There are no complaints from LSPs you are saying. They are doing a good job. Is that what you are saying? Patil: Absolutely. I must tell you we are learning a lot of things from them. There is an annual meeting and also periodical ones.

Aanand: I’ll throw open the session to questions from the audience. Raveendran: Actually if you look at the LSPs, it is the third generation which has invented the LSP. Otherwise that concept was never there, it was more of a CFA operation. Coming to the role of LSP even now it is limited. If you want to remain in business, then solutions have to come from their side. Arif: What actually pushes a person to become a solutions person? The more value you add to yourself, the more you’ll be pushed to be a solutions person. I can tell you that pharmaceutical infrastructure in India is pathetic. And all the regulations are at their highest level. When it comes to taking a large, well developed warehouse, pharmaceutical companies are the last ones to do so. Jeevan: It’s a situation where we have to transform. The evolution is taking place and it’s going to demand different kinds of things from us.

Track 7: Landscape Change in Pharma – GST B Raveendran PA Patil, VP (Supply Chain & Business Development), Lupin n Ashu Gupta, Associate VP (Distribution & Logistics), Wockhardt Moderator: Aanand Pandey Aanand: The taxation structure of the Indian pharma industry is a major obstacle to the growth of the industry. GST has been proposed to solve those issues but it looks really tough that it would be implemented on time because of lack of consensus between the states and the Centre. How will GST change the distribution model? Ashu: GST will not change the distribution per se. We’ll shift to geographical locations that are more convenient in terms of logistics. Aanand: Mr Patil, could you add to that? Patil: The implementation of GST n n

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< EVENT TraNscripT

From L-R: Aanand Pandey, B Raveendran, PA Patil, and Ashu Gupta.

will see some minor restructuring. Some portions of Gujarat can be serviced from Mumbai, which is closer or some portions of Tamil Nadu can be serviced from Bangalore. But it is too early to comment. We need to know the form GST will take - SGST, IGST, or CGST. Aanand: Mr Raveendran, what changes do you see in the distribution strategy of pharma companies? Raveendran: If you look into GST, itâ&#x20AC;&#x2122;s a dream come true because the expectation of the pharma industry is a borderless India. Then you can locate your warehouses at places of convenience. Over and above, supply chain can do away with all the filling of various forms. In other words, we acquire speed of activity and that means helping us to do business faster, while reducing inventory level. Aanand: Mr Patil, what are the elements it would cover in terms of size, VAT, service tax. What is your understanding?

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Patil: Let me tell you the elements that have been proposed to be included in GST: excise duty, service tax, VAT, of course octroi, local levies, and I donâ&#x20AC;&#x2122;t know to what extent customs, thus making it a single tax. And the convenience as Mr Raveendran explained, would be a smooth operation, particularly the elimination of the check-post. Partially it will simplify the road permits and we will have some flexibility to restructure the distribution points. From the transportation point, the time spent at check-posts will reduce. Tailor made software will manage everything. Aanand: Internationally, I am not aware of GST in countries like Canada or USA. So the form of GST we have in India, how different would that be if implemented, as compared to other parts of the world? Raveendran: I think if you compare the nearest country, it is Singapore. They are trying to work around that.

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When you buy something in Singapore, you get a GST refund at the airport. May be India is planning something similar in the first stage. Aanand: Mr Patil, could you explain your views on the international form of GST? Patil: I understand that internationally, countries are following a slightly different type of GST. I think what I heard is that ours is similar to France. See one is the single form of GST, the second is multiple. There is no point in inviting multiple taxes of IGST, CGST and others such like. Wherever you do your bulk selling, billing can be done straightaway from the Central Warehousing. Aanand: What about the margins for the supply chain? Raveendran: By and large, the margins always exclude taxes, except in certain cases. So I think GST will have a direct impact on margins. But those paying inclusive of excise duty I think it will get knocked out.


< feAtuRe

reaching gandhi’s india At one time it was the urge to expand and seek out new markets that led to companies exploring the hinterland. Rural supply-chain was born. However, it was not easy to pitch. So they began seeking out from among the people to be their voice. Some of the best innovations have happened here, says Jayashree Mendes.

M

ost of the classic examples of rural success have come from European multinational companies. Giants like Philips, ITC (now an Indian company), Colgate, Hindustan Lever, have long made inroads into rural markets. Of course, there are Indian companies that have also been at the forefront of rural policies – Godrej, Britannia, Marico, Hero Honda, Maruti Suzuki, Dabur, Tata Tea… now it’s endless. But this was not so a few years ago. Companies did not design products keeping rural areas in mind. Moreover, as purchases made by rural folks were relatively smaller in quantity with a time difference between the purchases, would the quantity of sales generated be commensurate with the efforts to create a distribution channel? Today, the scene is vastly different. Indian companies are not merely ‘selling’ their products to rural folks. It goes much deeper. Compa-

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nies have cerebrated long-term policies for rural areas that would not only provide a cushion to bank on, but also see the upliftment of these remote areas. It’s not merely a case of hedging one’s bets. Most of these feats are paying off. According to a report brought out by MART, a New-Delhi based research organization that offers rural solutions to the corporate world, rural India consumers hold a major share in several categories of products. Rural India buys 46 percent of all soft drinks, 49 percent of motorcycles and 59 percent of cigarettes and almost 11 percent of rural women use lipstick. The report also states that rural FMCG markets are sized at $30 billion and comprise 57 percent share of total FMCG market in India. Rural markets are growing at 17 percent as compared to 12 percent in urban markets. This was not a day’s work. Dr. Rajesh Shukla, Director of NCAER Centre for Macro Consumer

September 2011 | www.logisticsweek.com

Research (NCAER-CMCR) at National Council of Applied Economic Research (NCAER), says, “The rural landscape has and is undergoing a steady and dramatic change. There’s definitely a shift in income sources and consumption patterns by consumers in rural India. In all this, it is not possible for any marketer to ignore the Bottom of the Pyramid (BoP) segment. He is driving consumption through sheer numbers.” Considering that over 70 percent of India’s one billion plus population lives in around 627,000 villages in rural areas, the potential of rural


India to bring in the much-needed volumes was large. The crux for companies’ policies when innovating for evolving BoP consumers, had to center round its distribution and supply-chain. People within the company and outside agencies were singled out to understand the system and make it a success. Strategies were evolved. Physical and social infrastructure were set up. And the latter has paid off.

A New face Initially, in order to reach out to the masses, most companies sought

out super-stockists in areas that had a cluster of villages or shops. Sachin Vyas, Vice-President (Sales), Tata Global Beverages (TGBL), says, “We worked out van routes to incubate spaces where normal stockists were unable to reach and created a pull for our products.” This worked well when the company was merely trying to sell new products in such places. But it was the creation of incomes for people there and the appointment of rural folk, especially women, and bringing them into the distribution system that worked

well for both – companies as well as rural folks. While Hindustan Lever Ltd (HUL) is cited as the role model in this strategy, and ITC’s e-Choupal has been another trendsetter, many more companies have taken this forward over the last few years, thus playing a vital role in rural development. Saroj Kumar Mohanta, Partner, MART, says, “We understand that the rural consumer is also a producer of goods and services. Therefore, if companies can work with the rural poor to produce goods or services, the income will increase INDIA |

Companies are known to train rural people before roping them into the supply-chain.

September 2011 | www.logisticsweek.com

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< feAtuRe and this in the long run will also increase the consumer’s consumption capacity.” Mohanta says, “When we created Project Shakti in 2000, the idea was to reach the millions of potential consumers in remote villages where we had no distribution model. As these villages are not connected with adequate infrastructural facilities and we could not penetrate with any advertising, we created the self-help groups.” The company sought out NGOs, the government, banks and MART and began training rural women to become micro-entrepreneurs. Mohanta of MART says, “Along with HUL, we created women selfhelp group, and made them re-distribution business partners (entrepreneurs) selling a basket of mass market products relevant in these

areas. These less literate women with no experience to understand a company became Shakti Amma, through training, handholding and exposure to business. The project was integrated into the HUL distribution system and today there are 50,000 or more Shakti dealers across the country.” It became the responsibility of HUL to provide the women training in selling and bookkeeping to maintain the tempo. Similarly, MART has designed various business collaborative models for several companies to reach these evolving BoP consumers. Similarly, MART engaged with the youth organization, Nehru Yuva Kendra Sangathan (NYKS), to identify youth to become the ‘last mile connect’ for companies. MART has developed the ‘youth entrepreneur model’ for several companies like

The empowerment to people of working in the village for the village reaps rich dividends. It creates entrepreneurs who are self driven. — Sachin Vyas Vice-President - Sales, Tata Global Beverages Ltd.

In The Four Front Most companies follow the 4A strategy when it comes to tapping the rural market. Awareness: With low literacy and low media penetration, companies are using ‘below the line’ (BTL) media. They are using physical and social infrastructures to interact and communicate. Physical infrastructures include haats (weekly markets), melas (fairs), mandis (agri-markets); while social infrastructures include self-help groups (SHGs), panchayats, farmer co-operatives and other groups. Examples of campaigns conducted by companies are: Washing one’s hands before eating conducted by HUL. Tata steel has set up haats and mandis across the country for its corrugated roofing sheets. Affordability: The rural income pattern is different from urban. Most of the earnings here are daily wages or weekly depending on the cropping season as agriculture constitutes a large part of income. Buying by rural consumers is also the small pack purchases. It is not necessary that they purchase small-priced or less-value products. They buy value products. Companies have improved affordability for their products by introducing small pack sizes and sachets. Today shampoo sold through sachets has 80 percent share compared to those available in bottles. Small pack sizes for biscuit brands (Parle, Britannia), detergents (Ariel, Surf Excel) and several other product categories have found new markets. Availability: The biggest challenge in meeting rural demand is the logistics and distribution cost. Conventional distribution models are not cost effective as volume sales in a village are low while the cost of reaching the village is high. Companies have adopted different models like social infrastructure, collaborating with existing institutions and in rare cases setting up a mobile distribution system like that of Eveready Batteries. Insurance companies have started working with banks to deliver insurance products. Banks and insurance companies are working with micro-finance institutions (MFIs) to deliver their products and services. Acceptability: For quite some time companies downgraded their products and offered lesser features or functions to sell in rural markets, as these markets were considered secondary. The opportunity in rural markets has forced many companies to innovate and introduce acceptable products. The Nokia 1100 was a product designed to be dust-free with long battery charge, good reception and an LED torch. It helped Nokia become an undisputed leader in rural areas.

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Colgate, Heinz, Eveready Batteries, Castrol and others. In these models 1,000 rural youth were productively engaged with companies.

energetic Progress A few years ago, most corporates preferred not to invest in rural markets. Rather, the approach was ‘dumping’. So if the urban consumer does not need it, then it can be sold in rural areas for a discount. The impression was that rural consumers would find this a good deal, as sometimes even the product was novel to them. This mindset has gone for a toss. Vyas of TGBL says, “The rural consumer is no less in terms of the value consciousness or the preference for a quality product. Economically, their absolute value of purchase may be lower, but the mindset as a buyer remains the same. They are looking for the price + quality + value equation in totality. They are in fact more


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socially conscious of the choice they make and would like to make an informed choice as well. These choices are very often collective choices.” TGBL’s initiative ‘Gaon Chalo’ involved tying up with an NGO to help them empower the villagers themselves to generate employment. These ‘distributors’ then appoint people to act as the last mile delivery channel. The efforts have enabled TGBL to ascertain delivery of a quality product as a value proposition to consumers, otherwise deprived, due to gaps in the distribution channel. Moreover, the company did not have to seek out local small retailers; it scrutinized local people and the availability of products ensured a choice to be exercised by the empowered customer. “Correspondingly, the delivery mechanism helps gener-

ate higher income opportunities for the local youth and women augmenting their earnings and raising the standard of living. It also protects the consumers from the spurious products which are available in abundance,” adds Vyas. The NGOs help TGBL to identify women and youth looking to supplement their incomes or opt for entrepreneurial opportunities. The partner works with TGBL to pass on the financial benefits to people at all levels, while delivering the product directly to the consumer or the small retailer. TGBL gets an insight into the mechanism and finer nuances of the area of their work and then suitably help the company set up a delivery channel. Each representative is allocated a designated area with the help of coordinators and the existing distribution set up. The NGO manages

A report brought out by the Neilson estimates the rural market to be worth approximately $9 billion in consumer spending in the fMCG space per annum. most of the planning and execution for TGBL. “This empowerment to people, through Gaon Chalo, of working in the village, for the village, reaps rich dividends. It creates entrepreneurs who are self driven while our

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< feAtuRe

Last Mile Reach

Last Mile Reach

Rural India geographically disperse, creating distribution challenges Consumer Groups

Rural Market Features Catchment – villages < 20 km from town Hospital/health clinic, Diagnostics

Feeder Town (5000)

R1 + R2

20-30 Kms Catchment - 15-20 villages Mostly <2k villages located away from town Primary Healthcare Services

Haat (weekly market) (42,000)

Products / Services

Branded Daily Needs, Durables, Services. Medicines Go to Occasionally

R3 + R4

All daily needs Medicines. Go to Weekly

<5 Km

Source: MART

2k+ village – <20 shops <2k village – <10 shops ASHA/AWW

Village Shops

R3 + R4

(4.1 MILLION)

Consumer goods (local brands) Go to Occasional/ Emergency Government health supplies to AWW/ASHA

Most branded product purchases from outside village due to poor local availability.

organization helps in training and the commercial part of the business sense. Self motivation and hunger for growth benefits the business and makes the model sustainable,” says Vyas. An NGO that has been involved since 1998 in empowering rural women is Sakhi Retail Private Limited (SRPL). Centered in rural areas in Maharashtra, its aim is to improve the health and well-being of Indian rural households by distributing high-quality, affordable goods and appliances where they are least accessible. Upmanyu Patil, CEO, SRPL, says, “Our network reaches out to nearly 80,000 families in five districts in Maharashtra. With the Oorja smokeless biomass stove, we began scouting for women seeking a livelihood. Today, we have hundreds of women retailing

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more than eight products within the communities.” It was after the earthquake in 1993 in Latur that SRPL realized the plight of women handicapped due to a lack of education. Though it took the NGO plenty of time to convince women, the advantage was that families would instantly take to them as entrepreneurs, while outsiders would be looked at warily. SRPL has also roped in savings and credit groups to compel women to be selfsufficient, while it takes care of the training. Companies, on their part, participate in product training. A recent report brought out by The Neilson, estimates the rural market to be worth approximately $9 billion in consumer spending in the FMCG space per annum. This has buoyed other companies like Tata (trucks and mini-trucks), Rallis India, LG

September 2011 | www.logisticsweek.com

Electronics India, Coca-Cola, etc to customize products while devising schemes for these markets. Despite the acute water and electricity shortage, LG Electronics India has an initiative Sampoorna and Cineplus for its color TVs. Prices are kept competitive. It has also set up mobile service vans to reach out to people in the remotest locations to offer post-sales support. However, the company is yet to take the fi rst step to empower men and youth in these areas. KK Kaul, Head (Supply Chain), LG Electronics India, says, “Although technology has caught the fancy of rural people, we are still considering possibilities of roping them in. Electronics sales are not the same as FMCG goods.” But this could be a matter of time.


UNIWORLD INTEGRATED LOGISTICS PARK UNIWORLD INTEGRATED LOGISTICS PARK

+

A11 & A12 SIPCOT Industrial Park Irungatukottai, Sriperumbudur Tel: +044 47162268 / Fax: 044 47162210 www.uniworld-logistics.com

A11 & A12 SIPCOT Industrial Park Irungatukottai, Sriperumbudur Tel: +044 47162268 / Fax: 044 47162210 www.uniworld-logistics.com


AS THey APPeAR... 1. A Visvanathan 2. Ajay Chopra 3. Akash Bansal 4. Amit Maheshwari 5. Anshuman Singh 6. Ashok Goyal 7. Ashutosh Gajjar 8. Asim Behera 9. Carsten Hernig 10. Chander Agarwal 11. Christoph Remund 12. Dileepa B M 13. Dushyant Arya 14. Jairam S. 15. Jeevan RaoSahib 16. Kapil Premchandani 17. Kenneth F. Koval

t i t a n s fLogistics 18. M. Premkumar 19. Naresh Agarwal 20. Percy Avari 21. Pradeep Kumar Tewari 22. Pranil Vadgama 23. Purvin Patel 24. R. Jayakumar 25. Rajiv Mongia 26. Rene Wernli 27. S A Mohan 28. Sanjiv Kathuria 29. Sharmila Amin 30. Sheetal Shetty 31. Tarun Goyal 32. Vineet Kanaujia 33. Vineet Sharma

This month, Log.India completed four years of being in circulation â&#x20AC;&#x201C; four rewarding, gruelling, inspiring, testing years of connecting the logistics world with itself and with its customers. To commemorate the fourth anniversary, we thought of approaching the head honchos of logistics companies who have shaped this world. We wanted our readers to know what makes these logistics company chiefs â&#x20AC;&#x201C; where they hail from, their educational background, where from they learned the ropes of the industry, and their current plans. Fortunately, we received an overwhelming response. Presenting, in all its 17-page glory, our special supplement of this issue on the men and women who drive the industry, or as regard them, and hence are calling this section: The Titans of Logistics.

*in alphabetical order

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September 2011 | www.logisticsweek.com


titans of logistics

The Warehousing Guru

A. Visvanathan executive Vice President & Business Head, Godrej Storage Solutions “EFFIcIEnT WArEhousIng And LogIsTIcs WILL bE A corE succEss FAcTor ThAT WILL suPPorT And dIFFErEnTIATE IndIA In ThE yEArs To coME.”

A.M.Visvanathan, Executive Vice-President & Business Head, Godrej Storage Solutions is an experienced professional actively involved in supporting the modernization of warehousing in India. Vish, as he is popularly known in business circles, is a Mechanical Engineer from Chennai after which he acquired a management qualification from Jamshedpur. Mr. Visvanathan currently heads the Storage Solutions Business unit of Godrej & Boyce based out of Chennai apart from overseeing the activities of the Automation Business based in Mumbai. He is an active member of industry platforms that promote modern warehousing in India, and strongly believes that efficient warehousing and logistics will be a core success factor that will support and differentiate India in the years to come.

coMPAny ProFILE With over five decades of experience in serving Indian customers, Godrej Storage Solutions is a pioneer in the area of Material Storage and Handling. With innovative and focused solutions for customers in various industry segments, Godrej Storage Solutions is today the market leader in all its areas of operation. Apart from the historical business lines of storage and forktruck manufacturing, Godrej entered the area of offering Automated Storage and Retrieval Systems over 10 years ago. Recognizing the need from customers for consulting support to solve warehousing problems, the company entered the area of warehouse consulting quite recently.

Charge Of The Brigade Ajay chopra, a Chartered Accountant by qualification, has been working in the industry for over 20 years now. Prior to joining DIESL, Mr. Chopra has worked with Amway, IndoMobil, RPG-Group and PearlPet and has created and established process driven and system backed operations in the areas of commercial, supply chain and startup ventures. Mr. Chopra is recognized in the industry for establishing logistics industry’s first home grown Quality Model and has been focusing on making the industry more process driven. He has been working on creating a common and cohesive face for the logistics players in the Indian market and has been at the forefront to establish logistics as an Industry. coMPAny ProFILE The foundation of Drive India Enterprise Solutions Limited (DIESL) is built on the strong legacy of the TATA Group. DIESL is jointly owned by TATA Industries Ltd & TATA International Ltd. With the entry of DIESL, TATA has expanded

its vision and has forayed to serve companies and provide them end-to-end logistics solutions. DIESL started its journey in 2003 by setting up a trading line business for telecom products with a presence in six states. The company has grown by over 100 percent every year for the last three years. Presently, DIESL has over 175 warehousing and distribution facilities across India covering more than 5.5 million sq.ft. spread across 28 states. DIESL provides a range of logistics services including warehousing, distribution, international logistics, kitting & packaging, telecom trading and value-added services like cash management and e-trade. DIESL has roped in TCS (Tata Consultancy Services) as a technology partner to provide integrated technology applications and world class systems to facilitate end-to-end solutions for its clients and their business need. The company has established a country-wide LAN/WAN, using MPLS, VSAT and VPN at all DIESL facilities. The networks and systems are highly secure with a system known as “Onion Defence”.

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Ajay Chopra CeO Drive India enterprise Solutions Ltd (DIeSL) “ExPLorE And dIscoVEr nEW busInEss horIzons ThAT ProPELs onE To A nEW ToMorroW.”

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titans of logistics

A Balancing Act

Akash Bansal Head (Logistics) Om Logistics Ltd

“WE oFFEr onLy ThE VEry bEsT To hELP you MAkE your busInEss sIMPLE.”

Akash bansal started his career with Om Logistics almost a decade ago as a management trainee. It is his leadership and proven track record that has helped strengthen the company’s position in the logistics industry. He has spearheaded various businesses for Om Logistics over the past few years. He has driven the organization towards adopting leading-edge technologies to actuate business process improvements. Mr. Bansal holds a degree in BE (Electronics) from MIT, Aurangabad, and a Master’s in Business Administration (Materials & Logistics).

the supply chain, from transportation to warehousing. Based on the business principle of just-intime delivery, Om Logistics Ltd. has established its infrastructure to support manufacturers across the world. Quick delivery, perfect organization of the flow of goods, combined with state- of-the-art IT communication systems, are the tools it operates with. In the process, manufacturers save their capital investment by reducing the inventory cost and their customers benefit from finer rates, faster deliveries and products in perfect condition.

coMPAny ProFILE Om Logistics, the flagship company of the Om Group, is a leading Indian multi-modal logistics company. It offers its clients a single-window logistics experience by integrating services across

The Winning Streak Amit Maheshwari is the founder of Softlink and CEO of the company. He combines unique skills of three decades industry knowledge with 20 years in both software development and business management. He has a deep technical understanding of technology and is the architect of Softlink’s world class products. He is keenly and actively involved in day to day management of the business Having completed his Bachelors of Engineering (BE) in Information Technology, Mr. Maheshwari has worked with a technology company and a logistics firm before starting his own enterprise. Mr. Maheshwari has been instrumental in pioneering technology solutions for the logistics sector. He has been actively involved in creating awareness on the benefits of IT adoption, in conjunction with the trade associations in the sector. Under his able guidance the company has grown to be the leading solution provider for the logistics sector in the country.

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coMPAny ProFILE Softlink is a world-class provider of information technology solutions for logistics industry. Softlink offers integrated logistics solutions that automate and streamline the operations and business processes. Trusted by over 3,000 clients and 60,000 users across the globe, Softlink products are recognized for their superior quality and cuttingedge technology. With over two decades of experience in developing solution for the logistics sector Softlink has deep understanding complexities of the logistics sector. Softlink is dedicated to assisting clients to improve visibility, efficiency, quality of service and profitability with use of its logistics management software and IT solutions.

September 2011 | www.logisticsweek.com

Amit Maheshwari CeO and Founder Softlink Global Logistics

“WhEThEr you nEEd A quIck FIx or A LArgE-scALE soLuTIon To An ongoIng busInEss chALLEngE, WhAT you nEEd Is InForMATIon TEchnoLogy.”


titans of logistics

Think Different

Anshuman Singh MD & CeO Future Supply Chains

“An EFFIcIEnTLy run suPPLy chAIn WITh An InTEgrATIon oF TEchnoLogy, AuToMATIon, InFrAsTrucTurE, ProcEssEs, cAn bEcoME ThE kEy To MArkET LEAdErshIP. ”

Anshuman singh, a Mechanical Engineer and an MBA, is the MD & CEO of India’s first IT enabled, fully-integrated supply chain management company – Future Supply Chain Solutions Limited. In a career spanning eighteen years, he has created organizations from inception and then led them on a high growth path through meticulous strategy, planning and execution. He has worked in all facets of the value chain across industry segments such as discrete manufacturing, durables, textiles, retail and supply chain in companies of repute. He has the rare combination of having successfully led organizations as the CEO in the fields of retail as well as Supply Chain. At Future Supply Chain, he has set up the first integrated and fully automated supply chain company across all major categories like fashion, FMCG, food, home, general merchandise, engineering, pharmaceuticals, and automotives. coMPAny ProFILE Incorporated as a separate company in 2007, Future Supply Chain is India’s first fully integrated

IT-enabled end-to-end supply chain solutions provider, from point of origin to consumption. Over the years, Future Supply Chains has developed expertise in managing supply chains across categories like fashion, food, home, consumer durables, electronics & it, pharmaceuticals, auto and general merchandise. Each product category has a distinct supply chain with its own distinct requirements that need customized solutions. Future Supply Chains services customers through its various lines of businesses like FSC Express, Contract Logistics, International Logistics and Brand Distribution Services. The state-of-the-art distribution centers are equipped with the best-in-class Warehouse Management System (WMS) and Put to Light (PTL) Sortation System from the US and have incorporated best practices in infrastructure and MHEs from European countries. The fleet of dedicated vehicles is equipped with Transportation Management System (TMS) and Vehicle Visibility System (VVS).

Less Far Apart Ashok goyal has led the transition of BLR Logistiks (I) Ltd from a small trucking company to a pan India Rs 275 crore logistics solution provider. Mr. Goyal joined the family business set up by his father in the early 1980s, Bombay Ludhiana Roadways. It was a trucking company offering services between Bombay and Ludhiana, with an annual turnover not exceeding Rs 10 crore. An early decision taken by Mr. Goyal was to expand his service network. He set up branches in the West and North Zones and later on in the East and South Zones. Today BLR has a pan India presence with 80 + Branch Offices. coMPAny ProFILE BLR specializes in EXIM logistics and designs solutions which address the pain areas and concerns of importers/exporters. The company has customized its vehicles to deliver more volumes. BLR offers a door-to-door, as opposed to port-toport, solution to importers/exporters. Due to its pan-India presence and international network of agents, BLR is able to offer a one-stop solution to customers exporting goods from Ludhiana to

Germany by handling all parts of the logistics, right from picking up the cargo, transporting it to the port, custom clearance and the international freight co-ordination, and handling port activities at the destination. BLR realized the problems being faced by customers in the absence of documents like the N form which is endorsed at the Octroi check-post when goods leave Mumbai limits from the Mumbai port, for which no Octroi is payable. The company’s fleet is GPS enabled. Last two years, BLR has implemented an on-line web based ERP solution which connects all the offices to a central server and incorporates all aspects of its operations. A few years ago, it developed a unique program to empower its employees. It helped its employees to own trucks and managed it for them. BLR has been one of the first transportation and logistics companies to attract private equity investors. Reliance Capital, through its private equity division, acquired 31 percent stake in the company. This was the first PE investment by Reliance in any major logistics company.

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Ashok Goyal Managing Director BLR Logistiks

“To ExPLorE And dIscoVEr nEW busInEss horIzons ThAT ProPELs onE To A nEW ToMorroW.”

September 2011 | www.logisticsweek.com

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titans of logistics

Devil In The Details

Ashutosh Gajjar Project Head – Project Coordination and Space Marketing Shree Rajlaxmi Logistics “VALuE hAs VALuE onLy IF ITs VALuE Is VALuEd.”

Ashutosh gajjar completed his commerce graduation from Gujarat University in 1980 and joined Kemp Nitrogen Gas Generators Pvt. Ltd. (an American collaborated company) in the Project Logistics department. He was responsible for entire SCM for domestic as well as import. In 1990, he joined Videocon International Ltd and was responsible for the entire logistics operation in Gujarat. Later he moved to LG Electronics India as assistant manager logistics and handled branch logistics operation to more than 250 dealers and distribution in Gujarat State. He was later elevated to manager logistics and handled regional logistics operation for western region. In his current position, he built a 2 million sq ft Logistics Park at Bhiwandi. coMPAny ProFILE

than a decade and is supported by its own technical & professional team. It has been delivering cost-effective warehouses, built to suit warehouses, quality infrastructure, safety, and green plantation. The company has a lineup of more than 15 million sq ft well-planned warehousing, commercial & industrial projects in Bhiwandi, Mumbai. Shree Rajlaxmi initiated this vision to roll out a customized warehouse for all big demanding customers right from MNC to local biggies at Mumbai that has become a success. Today the facilities it offers customers measure to more than 15 million sq ft in terms of infrastructure. The company is taking its plan pan India and has targets to develop 28 million sq ft over a period of next five years.

Shree Rajlaxmi is a leading developer of sustainable logistics & industrial parks for more

Patently Different Asim behera has the heart of an engineer and the spirit of an entrepreneur. Mr. Behera is the face of Swisslog’s new and growing presence in India. A Swisslog alumnus, he has returned to the company to take on this important strategic role from his most recent post working for the Government, Washington, DC. Mr. Behera’s native understanding of India’s local and business culture, coupled with his deep knowledge of Swisslog and its wide range of services makes him particularly adept at cultivating and advancing local partnerships. He completed his Bachelor of Science in Electrical Engineering at Oklahoma State University, and joined Swisslog where he rapidly moved up the ladder to head the Indian operations. He has designed, implemented and automated numerous multi-million dollar distribution centers for companies including mega-retailers Wal-Mart and Target. Behera is now working to expand Swisslog’s global presence and to assist companies to “think tomorrow today,” reaping the benefits of proven and cutting edge technologies today and well into the future.

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coMPAny ProFILE Swisslog is a global provider of integrated logistics solutions for warehouses, distribution centers and hospitals, with customers in over 50 countries worldwide. Swisslog’s comprehensive services portfolio ranges from building complex warehouses and distribution centers to implementing its own intra-company logistics software and technology for hospitals. Swisslog’s solutions optimize customers’ production, logistics and distribution processes in order to increase flexibility, responsiveness and quality of service while minimizing costs. Its core focus segments include food & beverage, pharmaceutical and retail. Apart from solutions it has in its offerings state-of-the-art Automated Storage Retrieval System (AS/RS) VECTURA and pallet conveyors PROMOVE. Headquartered in Buchs/Aarau, Switzerland, Swisslog employs over 2,000 staff in 20 countries worldwide, including an office in Bangalore, India. The group’s parent company, Swisslog Holding AG, is listed on the SIX Swiss Exchange. Its history dates back to Sprecher & Schuh AG, founded in 1898 in Aarau, Switzerland.

September 2011 | www.logisticsweek.com

Asim Behera General Manager India Swisslog

“ThErE Is A dIFFErEncE bETWEEn sPoTTIng oPPorTunITIEs And crEATIng ThEM.”


titans of logistics

Flying High

Carsten Hernig Regional Director Lufthansa Cargo AG

carsten hernig first entered the airline industry as a trainee in Frankfurt, Germany in 1993. Five years later, he became part of the Lufthansa Cargo family in Singapore as Manager for sales steering and capacity planning for Asia-Pacific. Later he moved to Moscow as regional director sales. He was soon promoted to Regional Manager-South China, Hong Kong and Taiwan and began handling the largest cargo hub in the world. Three years ago, he arrived in India as regional director, South Asia, Middle East & Pakistan.

tinations in more than 100 countries with its own fleet of freighters, the belly capacities of passenger aircraft operated by Lufthansa and Austrian Airlines, and an extensive road feeder service network. The bulk of the freight transported by Lufthansa Cargo is trans-shipped through Frankfurt Airport. Lufthansa Cargo is a wholly owned Lufthansa subsidiary.

coMPAny ProFILE “To AccoMPLIsh grEAT ThIngs, WE MusT noT onLy AcT, buT ALso drEAM: noT onLy PLAn, buT ALso bELIEVE. ”

Lufthansa Cargo ranks among the world’s leading cargo carriers. In the 2010 financial year, the airline transported around 1.8 million tonnes of freight and mail and clocked up $8.9 billion revenue. The company currently employs about 4,500 people worldwide. Lufthansa Cargo focuses on airport-to-airport business. The cargo carrier serves 300 des-

Setting New Benchmarks As Executive Director of TCI, chander Agarwal spearheads TCI Group’s Express, Seaways, and Global expansion across South East Asia, Europe & South America. Preceding this he was heading New Ventures for the group from 2003 to 2005. His hands-on experience with Transfreight USA, a 3PL specializing in “lean logistics” and “JIT”, has given him unmatched knowledge of supply chain management. Having worked in other group companies he has set benchmarks not only within the company but in the industry as well. Mr. Agarwal is a graduate in Business Administration, and has specialized in Management and Minor in Political Science and Economics from Bryant College, Rhode Island USA in 2001. coMPAny ProFILE

has an extensive network of over 1000+ company owned offices, a huge fleet of customized vehicles and a managed warehouse space of 9.1 million sq ft. The company, through its various business verticals like TCI Freight, TCI XPS, TCI Supply Chain Solutions, TCI Global and TCI Seaways, offers complete logistics services and a single window solutions provider for all logistics needs, domestically and globally. It carries out its CSR activities through the TCI Foundation. TCI today is also a part of World Economic Forum’s Community of Global Growth Companies (GGC). TCI’s membership at GCC is a reflection of its consistent growth, its potential and its initiative to build global business and exemplary executive leadership.

Incorporated in 1958, Transport Corporation of India (TCI) is India’s leading integrated supply chain and logistics solutions provider. An ISO 9001:2008 company, TCI is listed with NSE and BSE. With a turnover of over Rs 1,850 crore, TCI

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Chander Agarwal executive Director TCI

“ThE IndIAn LogIsTIcs IndusTry hAs TrEMEndous PoTEnTIAL To groW oVEr duE To IncrEAsE In doMEsTIc And InTErnATIonAL TrAdE VoLuMEs.”

September 2011 | www.logisticsweek.com 59


titans of logistics

Shining A Light

Christoph Remund Chief executive Officer, DHL Lemuir Logistics Pvt. Ltd., India “WITh ProVEn ProcEdurEs And InVEsTMEnTs In PEoPLE And TEchnoLogy, coMPAnIEs ArE oPTIMIsTIc AbouT IndIA’s groWTh In ThE LogIsTIcs IndusTry.”

christoph remund is based in Mumbai and is responsible for DHL’s Global Forwarding (DGF) operations in India, which include 32 offices and warehouses across the country. Mr. Remund brings with him over 25 years of experience in the shipping and freight forwarding business, having joined Cargonautic Ltd., a shipping company based in Zurich, as Manager for its Asia Pacific operations in 1983. Five years later he moved to Hermes Shipping and Transport Ltd. as Country Manager for its office in Indonesia. He joined DHL in 1992 as DGF Country Manager for Indonesia and was instrumental in expanding DGF’s operations in Indonesia. Among his many achievements, he played an important part in establishing PT Danzas Saranaperkasa in Jakarta, Indonesia in 1993. He also played a pivotal role in the expansion of DGF’s Indonesian network and managed the company’s performance during the Asian Economic crisis and the Indonesian turmoil years.Mr. Remund graduated as Shipping Merchant from the Commercial School, Zurich, Switzerland and is also a graduate of the Military Recruitment School at Fribourg, Switzerland.

coMPAny ProFILE DHL is the global market leader in the international express and logistics industry, specializing in providing innovative and customized solutions from a single source. DHL has been building its logistics presence and strengthening its leadership position in India since it first entered the Indian market 40 years ago. The DHL brand in India encompasses DHL Global Forwarding, DHL Express, Blue Dart and DHL Supply Chain. Together DHL offers expertise in express, air and ocean freight, customs brokerage, primary and secondary transport and contract logistic solutions. A global network composed of more than 220 countries and territories and about 275,000 employees’ worldwide offers customers superior service quality and local knowledge to satisfy their supply chain requirements. DHL accepts its social responsibility by supporting climate protection, disaster management and education. DHL is part of Deutsche Post DHL.

All Fired Up dileepa b M completed his B.Com from Government Arts & Commerce College, Chitradurga, Karnataka, and went on to gather an MBA from Post Graduate Center, Kuvempu University, Karnataka. After completion of MBA, he joined a Logistics Company. In 2002, he joined Shreeji Transport Services as a Bonded Trucking Manager and started Bonded Trucking Division. Since the concept of Customs Bonded Trucking is common in European countries, Mr. Dileepa found that he had to make understand this concept to airlines. Today, more than 45 international airlines utilize its Bonded Trucking Services. He began the system of seeking out Charter Flight operators to use it Bonded Trucking operations. Besides carrying a single piece of cargo of 23 tons from Ahmedabad to Chennai, it carries cargo of up to 120 tons.

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coMPAny ProFILE Shreeji Transport Services has its registered office in Bangalore and head office at Mumbai. It owns a fleet of 300 trucks including container body trucks. With its wide network of operations, it provides transportation services pan-India and is an ISO 9001-2008 certified company. Today not only airlines but also Freight Forwarders employ its Bonded Trucking Services. It operates Bonded Trucking operations from Bangalore, Hyderabad, Coimbatore, Ahmedabad, Indore, Delhi, Mumbai, Chennai, Trivandrum, Cochin and Kolkata. The company has GPS facilities on all its trucks.

September 2011 | www.logisticsweek.com

Dileepa B M CeO - Bonded Trucking Shreeji Transport Services P Ltd., “hArd Work And dEdIcATIon WILL LEAd To succEss.”


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titans of logistics

Raring To Go

Dushyant Arya Director Indo Arya

“TIME Is MonEy’ As Is rIghTLy sAId, no ProducT/ sErVIcEs cAn coMPEnsATE IF IT’s APProPrIATE TIME hAs ELAPsEd ”

A Commerce graduate from Delhi University, dushyant Arya has a proven record for organizational turnaround, leadership, strategic, business change, transformation, operational and sales and marketing skills in demanding and diverse environments. With cross functional expertise in warehousing and distribution, he is well versed in accounting, operations and client relationship management (CRM). Mr. Arya’s association with Indo Arya began in 1996 as a management trainee, and thereafter he has been involved in planning and led complex projects from inception through completion. He has specialized in IT, identifying client’s requirements and implementing impact solutions. He has also gathered data and analyzed business operations of small to large sized companies, developed strategy and vision and oversaw business process and technical mapping.

coMPAny ProFILE Indo Arya is an ISO 9001:2000 certified company in view of the excellent working relating to goods transportation, express cargo, warehousing, distribution and logistics services. A goods transport enterprise that has strived since 1970, to cater to and satisfy the complex industrial and commercial requirements of expanding economy and make the vast country seem smaller. The name with its acronym, Indo Arya has become synonymous with the Indian transport industry. This entails insights into grooming managerial resources and streamlining manpower, setting standard in quality and fostering assurances of service. Our business philosophy revolves around customer dedication, innovation and value creation.

Setting New Benchmarks Jairam s is a Masters in Commerce with specialization in management from RA Podar College of Commerce and Economics and holds an MBA in Marketing from Institute of Technology and Management, Mumbai. With 18 years experience in the field of supply chain and logistics, he has long term exposure to international freight management, design solutions, packaging re-engineering, and consulting. His career began with VIP Industries as commercial trainee where he worked for three years. Post completion of management program, Jairam joined AFL Logistics and has been in the field of contract logistics, international freight management and SCM. Possessing a keen interest in automotive, he has been part of design and packaging solutions as an integral part to supply chain. coMPAny ProFILE Schnellecke – Jeena Logistics (SJPL) is a merger of two business houses — Schnellecke Group of Germany and Jeena & Company of India. The Schnellecke group is headquartered in Wolfsburg, Germany, and has offices in 40 locations across 14 countries. The Schnellecek Group

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has operations in logistics, manufacturing and transportation business with team strength of 13,000 people. Jeena & Company is a pioneer in international freight forwarding and customs clearance, and has its presence across India with 25 offices and with team of over 1,100 people. In India, Schnellecke-Jeena Logistics caters to the automotive market with services like implant logistics, line feed operations, packaging design consulting, packing support solutions, CKD/SKD solutions, warehousing and inventory support, Just in time, Just in sequence, sub-assemblies/modular assemblies and supply chain remodeling. Schnellecke Jeena logistics Limited (SJPL) is less than a year old in the country. The company plans to deploy best practices learnt globally and blend it with Indian talent. The service offering will be a value enhancement to the supply chain with integrating Just in sequence concepts (JIS) along with building modules like cockpit assembly, center consoles, exhaust systems, front axel etc. The critical aspect would remain ensuring quality processes defined across the value chain.

September 2011 | www.logisticsweek.com

Jairam S. executive Director Schnellecke - Jeena Logistics India Pvt. Ltd. “IndIAn suPPLy chAIn nEEds VALuE InTEgrATors.”


Log. India

Size 206 X 270 mm Date 14.06.2011


titans of logistics

That Heady Feeling

Jeevan RaoSahib Director Indelox “LogIsTIcs WITh ITs rELATEd sErVIcEs ArE bEIng rEcognIzEd As VALuE crEATors. WE WILL WITnEss soPhIsTIcATEd ExPEcTATIons For WhIch ThE IndusTry Is gEArIng uP.”

After acquiring a degree in Commerce and alumni of IIM (Bangalore), Jeevan raosahib started his career with TVS Group’s auto parts distribution company. Learning the corporate operation skill was a passion and after a stint of five years he left TVS to try his hands at being an entrepreneur. Although it was not as successful as expectations, Mr. RaoSahib moved to an electronic instrument manufacturer that gave him exposure to Indirect tax regulations and commercial functions. From there, he moved to join an export oriented unit (EOU) manufacturing leather garments and goods and was responsible for business development and backward integration. In 1995, he decided to move to a service industry and joined Jayem Impex (now part of Nippon Express). In 2000, he again tried his hand at being an entrepreneur and promoted Indelox.

coMPAny ProFILE Indelox has grown in the last four years in a natural way exploring the tremendous outsourcing opportunity in supply chain functions thus making it a formidable player and niche player in SCM services. It has also received an ISO 9001 2008 certification from TUV Nord. With a well groomed staff size of more than 200 based out of Bangalore, Indelox manages commercial and distribution functions for leading brands in networking and structured cable business, earthmoving equipment, fine chemicals/reagents, entertainment, and healthCare companies. Another feature of service that Indelox provides is assisting Large Development Center’s to manage their Statutory/Compliance function with inventory. Providing time critical warranty spares is another area where the company sees good prospects in.

Getting Back Its Mojo kapil Premchandani formed K.D. Logistics along with Umesh Premchandani. Kapil has a management degree from S.P. Jain. He has been instrumental in forging long term partnerships with large FMCG and retail majors. His approach has helped the company create a presence in the northern and western region of the country. He built and empowered a professional team to take spot-on decisions to avoid delays in decisionmaking in operations. He has been focusing on creating state-of-the-art infrastructure by building big logistics parks across western and northern region of the country. Kapil bets big on assets and is creating assets across the spectrum by building warehouses, buying fleet of trucks and in the process has developed systems to ensure excellent services to customers. In no time, he has transformed the company from a C&FA (Carrying and Forwarding Agent) to a 3PL. His approach has helped the company to foray into lube and retail sector as well.

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coMPAny ProFILE K. D. Logistics was established in 2005. The company has grown exponentially and has positioned itself as a leading logistics player in the industry. It was the first company to have created and managed a logistics park at Bhiwandi spanning one million sq. ft. In an industry where infrastructure developers, owners and users are different entities, K.D. Logistics has plugged the gaps by creating own facilities. It has the expertise of managing both conventional and modern racked facilities. The company has its own fleet of trucks and has also invested in converting horizontally stacked warehouses into vertically racked facilities powered by a Warehouse Management Software. As 3PL service provider it performs the following activities: Warehouse Leasing Services (Owned/Leased), material management services, transport management services, capability of managing racked and lean locations, and staffing services (retail operations). The company also offers value added activities like managing order management centre, kitting and managing modern trade distribution.

September 2011 | www.logisticsweek.com

Kapil Premchandani Director K. D. Supply Chain Solutions Pvt. Ltd. “IT sTArTs WITh VIsIon And TAkEs sTrong dETErMInATIon To AchIEVE.”


PAN India Warehousing (3PL/4PL) Reverse Logistics Primary & Secondary Transportation In-transit Damage Reduction Solutions Partnership in Road Safety Programs Logistics BPO Logistics Staffing Services Logistics Consultancy & Training Audits & Benchmarking

E-04, Devashree Garden, Rutu Park Service Road, Majiwada Naka, Thane (W) â&#x20AC;&#x201C; 400601. Maharashtra Contacts : (+91) 99879 22244/9820761645 E-mail: customercare@getl.in


14th-16th September, 2011 - The Zuri White Sands Resort, Goa The first exclusive Strategy Workshop on the Logistics Industry, ‘Future Supply Chain Strategies’, conducted in 2010 by Frost & Sullivan’s Transportation and Logistics Practice, established a unique platform for the logistics service providers (LSPs) and end users to deeply explore the state of supply chains in key industries, identify the challenges, ways to address them, and above all, envision the potential strategies for future supply chains of these industries. This year’s workshop titled “Future Supply Chain Strategies THE WAY AHEAD” would serve as a platform to bring together all logistics end users and service providers under one roof and discuss the need for a combined effort from both the groups through collaborations, trust, and building relationships. Investments made through collaborations between service providers and end users would result in visibility and real-time information, and lead to the ideal future supply chain. This workshop aims to deliver a roadmap for this.

Key Benefits of Participating in the Workshop • Gain insights and learn about specific tools for actionable strategies for critical supply chain issues

• A platform to ideate and evaluate along with peers and leaders from key industries on the best possible methods and practices for future supply chains and develop practical, feasible, and sustainable models of supply chains for the future that can be implemented

Whom to Expect The workshop intends to assemble a network of today’s best thinkers, visionaries, and thought leaders from across the following key sectors: • Logistics Service Providers • Logistics Service End users Leading Companies from the Key Industry Sectors within the country including, - Automotive, IT Hardware and Telecom Equipment, Pharmaceuticals, and Retail • Logistics Infrastructure Providers Leading Providers of Logistics Infrastructure within the country, - Operators of Logistics Parks and Free Trade Warehousing Zones, ICD, CFS, and ports

Frost & Sullivan welcomes you to be an integral part of this Interactive – Path Finding – Only One-Of-its kind Strategy Workshop! Event Registration Fee: For 1 Person: INR 100,000/- + Service Tax @ 10.30% For 2-3 Persons: INR 90,000/- (per person) + Service Tax @ 10.30% Includes strategy workshop sessions participation, compendium, stay at The Zuri White Sands Resort, Goa during the summit, along with breakfast, lunch, cocktails, and dinner at the venue, pick up and drop facility from the Goa Airport Super Platinum Sponsor

Platinum Sponsors

Associate Sponsors

Media Partners

To Register and know more about the event contact: Subir Shah; P: +91 22 6607 2031; M: +91 99875 41051; F: +91 22 2832 4713; E: subirs@frost.com Srinath Manda; P: +91 44 6681 4382; M:+91 98848 72788; E: srinathm@frost.com Priya George; P: +91 6681 4371, M: +91 98403 55432; E: priyag@frost.com For more information please visit: www.frost.com/FutureSupplyChainStrategies2011


titans of logistics

The Big Guns

KENNETH F. KOVAL Vice President, Operations, India Fedex express europe, Middle east, Indian Subcontinent and Africa (eMeA) “EnsurE ThAT cusToMErs rEcEIVE A bEsT-In-cLAss ExPErIEncE And A VALuEAddEd ProPosITIon. ”

kenneth koval has much experience in the logistics sector as well as specialist knowledge of finance, being a qualified chartered accountant. As Vice-President of Operations India, he is responsible for leading the business development of FedEx international and domestic organizations in India and managing the company’s strategic business alignment in the country. Kenneth began his career at FedEx as a senior manager in the company’s Canadian operations. In 1991, he was promoted to managing director/ regional controller in Canada. Three years later, he moved to Belgium where he was designated MD/regional controller of EMEA. In December 1997, he was promoted to Vice President, Finance in EMEA and thereafter to Vice President Operations, India in July 2009. Kenneth has a BA (Honours) in Business Administration from Ashland University in Ohio,

and a MBA in Business Administration from the University of Toronto in Canada. coMPAny ProFILE FedEx Express is one of the world’s largest express transportation company providing delivery to more than 220 countries and territories worldwide. FedEx Express uses a global air-and-ground network to speed delivery of time-sensitive shipments, by a definite time and date with a moneyback guarantee. FedEx Express began serving India in 1984 through an alliance with a Global Service Participant, before entering the market independently as FedEx in 1997. Today, FedEx Express offers a robust portfolio in India such as import, export and domestic express.

Global Aspirations M. Premkumar, is an engineer with specialization in aeronautical design and Jet propulsion from Madurai University. His first job was a dream as Scientist engineer at ISRO as Quality control and Failure Analysis. In 1991, he started a partnership firm, Unitech Sales Agency, dealing in bulk chemicals in Chennai, Tuticorin and Bangalore. In 1996, he was inducted as Executive Director at Reliable Freight Forwarders, focusing mainly on garment logistics. The high-point came in 2002 when he started Uniworld Logistics with a 50 percent share holding. In a matter of seven years, the company has reached a consolidated turnover of $50 million with 32 offices in nine countries. Today, Mr. Premkumar is eyeing the European market as well. His deep understanding of finance has helped him maintain the growth of the international business 30 percent per year. coMPAny ProFILE Uniworld Logistics, a total logistics company, is emerging as the most versatile logistics service providers in the industry. From its Inception, Uniworld Logistics has dealt with market chang-

es and new knowledge-based economy with a steady focus on customer flexibility. This focus includes strengthening the financial structure, fortifying strategic alliances, acquiring new businesses and adapting diversified management services. Its global network of strategic alliances and world class partners backed with innovative use of information technology makes it a leader in the field of logistics. Uniworld with its presence in more than 10 countries, along with exclusive partners and alliances worldwide, is well equipped to serve 400+ business locations globally. Uniworld has invested immensely in developing logistics infrastructure in India and has evolved Unique Concept, Uniworld Integrated Logistics Park, which provides facilities like Internal Container Depot, Bonded Warehouse, general warehouse, temperature controlled warehouse all at one location. With increasing demand and growing requirements for total logistics solutions from customers, Uniworld has expanded its services to Distribution, 3PL/4PL services and contract logistics. Uniworld also offers custom-made logistics solutions for fashion and aviation industry.

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M. Premkumar Group Managing Director & CeO Uniworld Logistics Pvt Ltd.

“sErVIcE And dEPEndAbILITy Is ThE AbsoLuTE goA.”

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titans of logistics

Back In Business

Naresh Agarwal Director Crystal Logistics “drEAMIng To buILd A hEALThy nATIon.”

naresh Agarwal was educated in Kolkata where he obtained his Management degree in 1992. On completion of his studies, he joined the family transportation business. As a part of his training, he visited several Western countries and impressed with the development in these countries in supply chain management particularly in cold chain development. Realizing the way agricultural and horticulture products are handled and distributed in India resulting in huge wastages, he realized the dire need to focus on cold chain development. Back in India, he along with his two brothers took a decision to transform a proprietary business into a professionally managed logistics company focusing to develop cold chain development. He began creating a brand image, Crystal, for frozen products. coMPAny ProFILE Crystal Group is a leading third party provider of logistics and supply chain solution. It specializes in cold chain, and provides all services of warehousing and distribution for temperature sensitive products on a pan India network. The company

has exponentially grown since its inception, expanding its fleet size from one truck to over 125 trucks today, in a short period of time. Over the years, Crystal has taken steps to improve infrastructure and made a plan to create network of cold rooms for storage and build up resources in acquiring refrigerated vehicles of different temperature for providing good quality service. Simultaneously, the company introduced technological support to improve the quality of service in a cost effective manner like GPS for trace and track of vehicles, installed Data Loggers to monitor temperature in transit. Drivers of these vehicles have been trained as to how manage temperature in transit as well as on time delivery. The mission of the Company is 3-fold viz. a) People at large should get nutritious food and good quality medicine b) Farmers must get better price for their crop through better handling facility c) Nation should get benefit by cutting down wastages of food crop.

Bringing In Changes Percy Avari is the Country Manager for India in Aramex international, a company that now trades on the Dubai Financial Market. Mr. Avari holds a post graduation in accountancy qualifying as a Chartered Accountant in 1991. Since starting his career with Aramex in 1997, he has worked in several capacities including financial controller in India Station, reaching his current position of Country Manager for India in 2006. Mr. Avari has been an instrumental part of Aramex’s expansion in the Indian subcontinent. He has expanded the company’s footprint in India, and today Aramex has over 12 stations in the country. Mr. Avari is also an active member of the express and e-commerce industry in India and sits on the boards of Express Industry Council of India (EICI) and the Internet and Mobile association of India (IAMAI).

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coMPAny ProFILE Aramex is a leading global provider of comprehensive logistics and transportation solutions. Established in 1982 as an express operator, the company rapidly evolved into a global brand. In India Aramex operates since 1996. In India Aramex offers its complete range of services through a network of 950 locations pan India. Today, Aramex employs more than 8,600 people in over 310 locations around the globe, and has a strong alliance network providing worldwide presence. The range of services offered by Aramex includes international and domestic express delivery, freight forwarding, logistics and warehousing, records and information management solutions, e-business solutions, and online shopping services. Aramex is a founding member and chairs the Global Distribution Alliance (GDA), which brings together over 40 leading express and logistics providers from around the world. The network has more than 12,000 offices, 33,000 vehicles and 66,000 employees serving alliance customers.

September 2011 | www.logisticsweek.com

Percy Avari Country Manager Aramex International “succEss Is nEVEr FInAL. FAILurE Is nEVEr FATAL. courAgE Is WhAT counTs.”


titans of logistics

Getting Larger

Pradeep Kumar Tewari executive Director & CeO Credence Logistics

“susTAInAbLE succEss coMEs Through cusToMEr FocusEd APProAch, WhIch Is FAr AboVE MErE MAInTEnAncE oF sLAs ”

The 47-year old Pradeep kumar Tewari is a postgraduate in science and has done an executive MBA program from IIM, Ahmedabad. Tewari, who began his career as a lecturer in a degree college, Kanpur, teaching Physics was lured into logistics through a management trainee program at TCI. He moved to GATI to manage their all India operations. A logistician with 24 years of experience, Tewari is a visionary for institutionalizing Credence and transforming it into a world-class organization. He joined Credence Logistics Ltd in April 2007 after a stint with Ispat Industries as head of logistics. Under his leadership the company has grown multifold and today has a diversified service portfolio. He has developed Credence as a thought-leader organization to benchmark against, and to consistently grow its P&L to be one of the most respected names in logistics. coMPAny ProFILE Credence Logistics Ltd., an ISO 9000 company, is in its 21st year of inception this year. In the last few years, it has helped hundreds of companies to reduce its supply chain costs

and to deliver better process efficiencies and turnaround times thereby enhancing customer satisfaction. It is a pan-India full-scale supply chain development and deployment organization with a mission to “offer best value to customer enabling us to become a one-stop logistics solution provider with a focus on high growth segments across industries thereby delivering customer delight.” Apart from an exhaustive 3PL/4PL module covering process enhancement of the entire supply chain, it offers services in multi-mode transportation, project handling, shipping (Chartering, Freight forwarding, etc), port logistics, yard & warehouse management and logistics parks. Credence Logistics has invested heavily into its Human Capital, drawing talent from leading organisations across the Industry and top notch institutions like ISB, IIM and IIT. Credence has widespread branch network across 36 locations in India and Indonesia and soon to be launched offices in Europe and China. All branches can be centrally contacted through a toll free customer service helpline: 1800-1029229.

Pooling Assets Pranil Vadgama joined CHEP in 2004 as Director for Six Sigma & Quality and in 2005 was promoted to Vice-President, Asset Management for CHEP Europe. He was appointed President, CHEP India in 2008. Before joining CHEP, Pranil spent 10 years with General Electric in the Netherlands, Spain and the US in various leadership roles - his last as Chief Information Officer for GE Industrial Systems, Europe. Mr. Vadgama holds an MSc in Business Systems & Analysis & Design from the City University of London. Mr. Vadgama strives to bring the benefits of equipment pooling to the Indian supply chain by driving industry standards in equipment usage and by enabling the development of a robust and reliable national network of equipment and services.

coMPAny ProFILE CHEP is a global leader in pallet and crate pooling services and packaging solutions, operating in more than 48 countries across the globe. In India, CHEP focuses on FMCG and automotive and allows its customers to benefit from a partner who shares industry knowledge and supply chain expertise gained over 50 years in this business. Doing business with CHEP enables you to reduce capital investment, reduce product damage, standardize and above all, protect the Environment! Within three years of the start-up of the business, CHEP India has developed a customer portfolio of over 200 of the top FMCG, automotive, and third-party logistics providers across India. CHEP’s work with customers, government and industrial bodies has significantly influenced the growth of the Indian packaging and supply chain verticals.

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Pranil Vadgama President CHeP India “coLLAborATIon AT suPPLy chAIn LEVEL WIThIn ALL ThE sTAkEhoLdErs In A ProducT cycLE rIghT FroM VEndors, MAnuFAcTurErs, 3PL, WArEhousIng And rETAILErs Is ThE MAnTrA oF ThE FuTurE.”

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titans of logistics

Beyond Borders

Purvin Patel COO Radhakrishna Foodland Pvt. Ltd.

Purvin Patel is the Chief Operating Officer at Radhakrishna Foodland Private Ltd. for over five years. Mr. Patel has had an outstanding career in the retail industry with one of the world’s largest retail group viz. Asda-Walmart in the UK. He spent 17 years with Asda and then subsequently AsdaWalmart. His responsibilities have covered the gamut of HR, merchandizing, logistics, MIS and store development. Mr. Patel graduated from Brunel University UK with a degree in Management Studies.

coMPAny ProFILE Radhakrishna Foodland Private Limited (RFPL), the pan-India supply chain management specialist, is the industry leader in supply chain of food, near food, agri-services and pharmaceuticals. With over 35 years of rich and varied experience in the foodservice, retail, quick service restaurants (QSRs), distribution and logistics businesses, RFPL has evolved into a consolidated, single point SCM solutions provider to some of the world’s largest companies in India.

Page Turner Freight, customs clearance, warehousing, distribution, transportation, express, courier, secured deliveries, IT for logistics, reverse logistics, supply chain compliance, the list goes on. If one man has envisaged building up companies to execute the above from scratch, then two facts must exist. The man’s vision must be unparalleled and the man’s experience must be vast. That pretty much describes r. Jayakumar. Armed with a degree in electronics engineering from Chennai in the 60s, his life has traversed the Indian logistics diaspora from being a materials management & compliance genius in the license Raj days. In the late 80s, the entrepreneurial bug took center stage, and he jumped into starting a logistics behemoth called Jayem Enterprise. In 2007, he sold a major stake in the flag ship company to Japanese giants Nippon Express, and continued his explorations in other logistics related fields.

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coMPAny ProFILE The Jayem Enterprise primarily focuses on logistics services or describe themselves are logistics service providers. Warehousing & Distribution or Inventory Management remains the focus. The traditional freight & customs clearance continues, along with Innovations in intra city trucking, reverse logistics and compliance activities. The Gomas Enterprise is oriented towards technology services, rising out of logistics needs of the former group. They focus on IT for Logistics and Enterprises, records & data management services, repair & return technology. Vaidi Enterprises provides logistics facilities in the asset heavy area of construction of warehouses and material handling equipment. All three entities as a whole are spread in about 40 locations across India, with strength of over 900 people, and a corporate office based out of Bangalore.

September 2011 | www.logisticsweek.com

R. Jayakumar Chairman The Jayem enterprise

“ToP LInE Is VAnITy, boTToM LInE Is sAnITy & cAsh FLoW Is rEALITy.”


titans of logistics

Breaking The Box

Rajiv Mongia Director Green earth Translogistics Pvt. Ltd.

“WE WouLd LIkE To bE knoWn For our hIghLy EFFIcIEnT And rELIAbLE sEcondAry dIsTrIbuTIon soLuTIons.”

rajiv Mongia completed his Bachelors in Electronics Engineering in 1992 immediately followed by a PGDM in operations management from SP Jain Institute of Management & Research. He started his corporate stint with Asian Paints and subsequently went on to work with various large MNCs in the area of Planning & Logistics. Mr. Mongia was part of the Asia Pacific Supply Chain Team for BP until 2009 when he started to promote his own logistics venture. In 2009, Mr. Mongia co-promoted his company, Green Earth Translogistics, with one of his business friends, and has made tremendous progress since inception. It has a national presence in the domestic warehousing and secondary transportation space.

coMPAny ProFILE Green Earth Translogistics is focused on Warehouse Management and secondary transportation from the warehouses to the customers. It specializes in short haul movements, both intracity and intra-state for both FTL and LTL consignments. The company has recently added a fleet of varying capacity of LCVs and ICVs to bring in a higher reliability of operations.

Global Stretch rene Wernli is a young, highly motivated, energetic and pragmatically result driven professional. He has a successful international working experience of over 20 years in the shipping and logistics industry, having handled business in all the industry verticals worldwide. He has held Senior Management positions in North America, South America, West Africa and Middle East. Before joining India in 2010, he was responsible for the Middle East & North Africa Area. Rene Wernli has a degree in Business Administration. coMPAny ProFILE The Panalpina Group is one of the world’s leading providers of supply chain solutions, combining intercontinental air and ocean freight with comprehensive supply chain services and valueadded services in logistics. Its in-depth industry know-how and customized IT systems enables it to provide globally integrated end-to-end solutions tailored to its customers’ supply chain management needs. The Panalpina Group operates a global network with 500 branches in more than 80 countries. Panalpina employs approximately

15,000 people worldwide. Panalpina India is the wholly owned subsidiary of Panalpina World Transport (Holding) Pvt. Ltd. based in Basel, Switzerland. Launched in 1986, Panalpina India is the headquarter for the South Asia Area with its head office in Gurgaon, Haryana. Panalpina’s core service offering, air and ocean freight, is complemented by Supply Chain Services (SCS) such as supply chain optimization or order management as well as Value Added Services (VAS) in logistics such as inbound to manufacturing, postponement or after market services. As a part of the Group & India strategy, Panalpina has a focused approach to customers in key industry verticals, namely healthcare, hitech, consumer and retail, oil and gas, automotive, fashion, telecom, chemicals, and manufacturing.

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Rene Wernli Area Manager– India/South Asia, Panalpina Group

“ExPAnd ThE orgAnIzATIon gEogrAPhIcALLy To AchIEVE susTAInAbLE, ProFITAbLE groWTh.”

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titans of logistics

Bringing In Reforms

S A Mohan CeO Maini Materials Movement

“IndIA hAs EMErgEd As A gLobAL InVEsTMEnT dEsTInATIon crEATIng dEMAnd For cAPITAL InVEsTMEnT In TEchnoLogIcALLy AdVAncEd WArEhousEs And Mh sysTEMs. ”

s A Mohan holds over 30 years of diverse sales, marketing, operations and corporate leadership experience. He is also Founder Executive Member of ‘Society of Indian Material Handling Equipment Manufacturers’. Mr. Mohan’s role entails business strategy, organization development, brand building, product development, besides carving out a strong growth plan over the next 3-5 years. Before joining Maini, Mr. Mohan headed sales for India and Asean at Molex Premise Networks, a global division of Molex Inc. involved in the manufacturing and supply of structured cabling systems. Mr. Mohan spent 23 years at Molex, from 1986 until 2009, growing his way up to the company’s cockpit. He was instrumental in driving several significant initiatives during his long tenure and helped the company soar to a leadership position in the regional and global markets. Mr. Mohan holds a Bachelor’s Degree in Commerce from Mysore University. As part of his professional training, he has undertaken a 2-year Management Training Program conducted by Harvard Business School, USA for Molex Senior Managers.

coMPAny ProFILE Maini Materials Movement is a turnkey solutions provider in storage racking solutions and material handling equipment domain. It is part of the Maini Group, one of India’s premier design and manufacturing conglomerate with interests in high-precision engineering components, warehousing and logistics solutions, materials handling, aerospace and electric vehicles. It is the only Indian company to design and manufacture indigenous Battery Operated Vehicles and Golf carts. The global partnership with NMHG has equipped them to manufacture selected European designed forklift trucks in India, while also making available an entire range of industry and warehousing trucks from Yale, in the Indian market. Armes Maini, their joint venture with Armes Spa, Italy builds warehouses and turnkey automated storage systems of all capacities to suit every storage requirement. MMM’s Research and Development program and Flexible/Lean manufacturing processes allows them to position themselves as a leader in the warehouse, logistics and mobility industry.

The Need For Speed sanjiv kathuria, the man behind the success of TNT express sales & marketing, has been with the company since 2002. He is an IIM-B graduate and has over two decades of experience in sales, marketing, customer service & general management. Prior to joining TNT, Mr. Kathuria worked at Modi Xerox and HCL-HP. At TNT, he is responsible for delivering profitable growth, and his strategies have been instrumental in growing TNT India’s revenues six times, since his arrival. In 2006, TNT launched its domestic express business and acquired Speedage. Mr. Kathuria’s strategy and plans accelerated business growth by integrating the air and road businesses positioning TNT as a complete express logistics solutions partner. He has been instrumental in building a unique suite of solutions for the health care vertical particularly for temperature controlled shipment handling.

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coMPAny ProFILE TNT Express established operations in India in 1994 and in 2006 it acquired Speedage. Headquartered in Bangalore, TNT Express India has just over 2,000 employees in India. The India domestic network has three gateways in Mumbai, New Delhi and Chennai, seven road hubs and 176 depots. There are more than 1,000 vehicles on TNT’s extensive domestic road network, which reaches 200 locations and more than 13,700 pin-codes nationwide.

September 2011 | www.logisticsweek.com

Sanjiv Kathuria Country Director - Sales & Marketing, TNT

“oFFEr cusToMErs A choIcE oF sErVIcEs bAsEd on TrAnsIT TIME To cATEr To boTh doMEsTIc And InTErnATIonAL MArkETs.”


ISO 9001: 2008

We handle everything with care From the fast lanes of towns and cities to remote locations, we handle everything in surface transportation right from a small 10 kg parcel to bulk sundry to Full Truck Loads with great care - our service being backed by expertise and experience spanning 50 years of industry leadership. We offer single window solution through our hard freight division V-Trans, Express Cargo division V-Xpress and Warehousing & Inventory division V-Logis. * We offer Comprehensive coverage under our Unique Marine Insurance Policy. * We have over 350 branches in 23 states, all connected through web based eCargo ERP application. * We offer fully equipped warehouses spread over 5,00,000 sq.ft. area.

V-Trans (India) Ltd. Plot No.5A, Navre Apartment, Swami Vallabhdas Marg, Sion (W), Mumbai â&#x20AC;&#x201C; 400022.

Phone: (022) 24043143/ 24020880 I Fax: (022) 24043144 l Email: info@vtransgroup.com l Website: www.vtransgroup.com l Toll Free No. 1800 220 180

V-Trans Reliable Hard Freight Transport

V-Xpress Timebound Multimodal Express Cargo Service

V-Logis Warehousing & Inventory Management


titans of logistics

Commerce Among Chaos

Sharmila Amin Head (Pan Projects) South Asia PanProjects

“scM rEquIrEs consTAnT InnoVATIon And AdoPTIon oF LATEsT TEchnoLogIEs To sTAy AhEAd oF ThE curVE.”

sharmila Amin has been responsible for the inception and growth of the projects business for the logistics major Panalpina World Transport (India) Business Div. (PanProjects) since 2007. She heads the India and South Asia area. Sharmila holds a Bachelors’ Degree from Bombay University majoring in financial accounting & auditing. She has completed her executive management from the George Washington University, USA. She has also concluded a specialization in shipping management from Indian Institute of Management - Ahmedabad. Additionally, she is an Indian Customs Rule 9 License Holder from Mumbai. In a career spanning over 25 years, Ms. Amin has spent in adding value to the Projects and Heavy Lift Industry. She has been associated with the success of organizations such as AFL, CRC Ltd., Hansefracht Spedition Gmbh, etc.

coMPAny ProFILE PanProjects and Oil & Gas - the Business Divisions of Panalpina World Transport, delivers customized logistics solution to the segments in EPC, Heavy Engineering, Oil & Gas, and energy etc. Panalpina is present in 6 continents, 180 countries with over 800 offices globally. Presently Panalpina is ranked as the 3rd largest logistics service provider globally with Quality practice, Technology & Manpower.

Where There Is A Will… sheetal shetty, Group Managing Director of Capricorn Logistics, is an Electronics Engineer by qualification. He started his career working for a multinational in freight forwarding. The experience helped him and he began heading Western India. To provide better services and make a difference in conventional “clearing and forwarding” industry, he started his own company in 2001, which has grown into a leading service provider in a short span of 10 years. Mr. Shetty is playing a major role in increasing the clientele base of Capricorn Logistics within India and abroad.

coMPAny ProFILE Capricorn Logistics is an India focused provider of integrated logistics and supply chain solutions. Capricorn offering clients innovative, cost-effective and tailor made solutions. Their array of customized solutions ranges from: air freight, ocean freight, deconsolidation, customs brokerage, door to door express service, surface transportation, combined transportation, customs consultancy, 3pl and 4pl, distribution, and telecom network commissioning. Capricorn has a strong presence in India with 48 offices and 11 international offices in countries like USA, UAE, Germany, China and Hong Kong.

Sheetal Shetty Group Managing Director, Capricorn Logistics Private Limited “ThE chALLEngE WILL bE To bE consIsTEnT And dEPEndAbLE.”

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September 2011 | www.logisticsweek.com


titans of logistics

Doing The Math

Tarun Goyal Country Head Transocean express Logistics

“IWE WAnT To sET uP ThE hoTTEsT coLd chAIn In IndIA. ”

Tarun goyal started out some 20 years ago as marketing executive with Chokhani Global Express Ltd. As part of the group who was heralded into the team before the company launched operations, Mr. Goyal’s job was to develop business partners, get people on board and bring in business. The learnings on-the-job helped him to become an Express Centre Head at Gati Ltd in Delhi. Though, he admits, that the job was tough he loved it as it developed his practical knowledge base and made him a professional. Two more stints later -- as regional manager at AFL, and later as corporate manager at Safexpress – helped him to sharpen his skill-sets before moving to RK Foodland as General Manager (Logistics). He learnt about cold chain operations and is now employed with Transocean Express Logistics as a country head for Cold Chain.

coMPAny ProFILE Transocean Express Logistics is a company set up by roping in industry experts. It is led by two professional directors -- AV Reddy and Alok Kumar -- both of them have been present in the industry for decades and have contributed to the current logistics scenario in the country. Transocean’s initiative to implement the system of FTR (First Time Right) has helped the company to understand the customer’s requirements and also gain traction among its customers. It also caters with services such as FTL, relocations, freight forwarding, 3PL and cold chain. Transocean Group has carved a strong niche in last 35 years. The flagship banners of the organization are “TransOcean” and “Blue Line Shipping”.

Vertical Sights Vineet kanaujia received his MBA Degree in Marketing from Faculty of Management Studies (Delhi) in 1999. He did his Bachelors in Engineering from MMM Engineering College (Gorakhpur) in 1997. Post his MBA, he started his career with HCL Infosystems and went on to work with Conagra Foods. Later he completed a long stint with consumer durables and IT giant Samsung. Working as Head (Marketing) at Samsung, Mr. Kanaujia created Market Leadership for Samsung across multiple business lines. Mr. Kanaujia joined Safexpress more than 3 years ago. He has been responsible for formulating the Marketing Strategy for augmenting the Brand Equity of Safexpress. His constant quest for innovation and incessant efforts to elevate ‘Brand Safexpress’, have led to the formulation of a powerful marketing strategy. In a relatively short time-span he has succeeded in firmly positioning ‘Brand Safexpress’ as the Market Leader as well as knowledge leader in the supply chain & logistics industry.

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coMPAny ProFILE Safexpress offers a complete spectrum of supply chain & logistics services including express distribution, 3PL and consulting services to enterprise customers. Safexpress provides services to a vast array of business verticals ranging from apparel & lifestyle, healthcare, hi-tech, publishing to automotive, engineering & electrical hardware, FMCG & consumer electronics, and institutional. Safexpress has kept its operations Indiacentric. The company provides services to over 5,000 corporate clients across eight verticals. With its largest fleet of over 3,600 GPS-enabled vehicles and network of over 560 destinations in India, Safexpress has the capability to deliver to every square-inch of India. Its 3PL Services are supported by a total warehousing space of over 6 million square feet across the country. It intends to create an additional four million square feet in the next couple of years.

September 2011 | www.logisticsweek.com

Vineet Kanaujia GM – Marketing Safexpress

“suPPLy chAIn & LogIsTIcs IndusTry Is ThE bAckbonE oF our EconoMy And ALL sET To bE A sunrIsE IndusTry In ThE nEAr FuTurE.”


titans of logistics

Digging Deep

Vineet Sharma Director Oil Field Warehouse & Services (OWS)

â&#x20AC;&#x153;InnoVATIon hAs To bE WAy oF doIng busInEss In LogIsTIcs. PursuIng AgE oLd ForMuLAs MAy noT Work In ThE coMPETITIVE WorLd.â&#x20AC;?

Vineet sharma completed his BS Marine Engineering in 2006 and soon afterwards joined the family start up, Oil Field Warehouse & Services (OWS). He quickly learned various aspects of the logistics industry before taking a break to pursue an MBA from IIM Bangalore. Thereafter, he returned to OWS in 2010 and took charge as Director of International Operations to help the company realize its ambitions for international expansion. Under Mr. Sharma, each OWS subsidiary is run as an independent profit center with the dual focus of developing a domestic market along with promoting the group companies. In order to capitalize on opportunities, Mr. Sharma is developing a unique procurement model for clients in India, to help them source specialized goods from the Middle East and the USA at competitive prices thus ensuring dedicated freight business for itself.

coMPAny ProFILE Oil Field Warehouse & Services (OWS) is a fast emerging multi-national material management company headquartered in Mumbai, India. It is a pioneer in convergence and responsible for a new market creation catering specifically to the Exploration & Production (E&P) sector in India. Presently OWS has its offices in five cities in India with its operations base in Mundra on the west coast and Vizag on the East coast offering SEZ based warehousing facilities. Besides these, OWS has established a global foot print through its branch offices and subsidiaries in UAE, Oman and USA. In all its expansion efforts, the focus remains on providing services for the Oil & Gas sector. In just a little over a year, OWS has expanded its operations to UAE and the United States besides strengthening its presence in Oman.

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< BOOK EXTRACT

Category Management Categories can be viewed as the smallest strategic business unit within a retailer. The goal is to improve business performance through focusing on delivering consumer value.

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ONE-OF-A-KIND PRODUCTION By Yiliu Tu, Paul Dean Copyright Springer-Verlag London Ltd 2011 ISBN: 978-1-84 996-530-9 302 pages

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any retailers and manufacturers in the consumer goods industry practice category captainship and report positive benefits. Retailers such as Wal-Mart, Metro, Safeway, and Kroger practice category captainship in some of their product categories and usually assign manufacturers such as Kraft Foods, P&G, Kellogg and Danone to serve as category captains because of their established brands in the market and their resource availability. Below are some specific examples of category captainship implementations from practice. Carrefour, the second largest retailer in the world, recently asked Colgate to serve as category captain in the oral care category. Based on a number of consumer studies, Colgate suggested that Carrefour restructure the display in paste products, as opposed to merchandising them next to each other. As a result of the restructuring, Carrefour reported 6-16 percent sales increase in the oral care categories in its retail markets. Colgate also benefited from this sales increase (ECR Conference 2004). The sales increase in the oral care category came at a little cost to the entire channel because Colgate mostly utilized its already existing consumer studies and its expertise in the oral care category. If Carrefour was to conduct the research necessary for such a restructuring, it would have been much more expensive. Similarly, Ross Products serves as category captain for Safeway in the infant formula category (Progressive Grocer 2004). Safeway asked Ross Products to examine the category and prescribe solutions to improve the profitability of the category. Rossâ&#x20AC;&#x2122; assessment of the category revealed that the category was undermerchandised: the infant formula subcategory was contributing 34 percent of the baby care categoryâ&#x20AC;&#x2122;s dollar volume, but was receiving only 11 percent of the shelfspace. Ross recommended some changes in shelf-


space positioning, and also reviewed and revised the pricing to boost profitability. After implementing the recommendations, the category boasted 9.2 percent sales growth benefiting both Safeway and Ross Products (Progressive Grocer 2004). One could argue that Safeway could have developed a similar prescription to improve the performance in the infant formula category without using Ross Products as a category captain, however, the cost of doing so would have been much higher as Safeway does not have the expertise that Ross Products does. General Mills serves as category captain for some of its retail partners in the Baking Ingredients and Mixes Category (Progressive Grocer 2004). General Mills’ recommendations are focused around SKU rationalization and variety-vs-duplication analysis. SKU rationalization is aimed at reducing the number of SKUs to reduce customer confusion at the shelf and thus create growth. Similarly, excessive duplication does not add much in incremental volume. Removing duplications allows for expanded product variety, which in turn can generate more sales in the category and help it grow. One of the retailers for which General Mills serves as category captain has seen a 10.2 percent increase in base dollar volume since General Mills’ SKU rationalization efforts (Progressive Grocer 2004). Although category captains are common in the grocery and consumer products industries, category captainship practices are making an appearance in apparel retailing as well. VF Corp., NC based manufacturer of brands such as Lee and Wrangler, serves as category captain for a number of its retail partners in the jeans category (Apparel Magazine 2005). VF Corps works with its retail partners to determine the product mix to be offered in each region, how products will be displayed on the sales floor, and how inventory levels will be managed in the category. Inspired by the success in the jeans category, VF Corp is looking forward to take on category captainship responsibility in other categories such as sports licensing and outdoor performance apparel categories. These examples, and many other successful category captainship implementations, demonstrate that by working together, retailers can considerably benefit from their manufacturers’ expertise in managing their categories and deliver consumer value through supply chain collaboration. However, conflict of interest between the retailer and the category captain or between competing manufacturers could be an issue. First, what is in the best interest of the category captain may take advantage of its position and disadvantage competitor manufacturers. It is not surprising that there is an emerging debate on whether or not category cap-

tainship poses some antitrust challenges. While there are many cases under investigation due to claims of antitrust practices, one publicly known and well-documented example where some antitrust issues have been important is United States Tobacco Co. vs. Conwood Co. case. United States Tobacco Co. (UST), the biggest company in the smokeless-tobacco category, was recently condemned to pay a $1.05 billion antitrust award to Conwood, the second biggest competitor in the category (Greenberger 2003). Conwood had sued UST, the category captain, and had claimed that UST used its position as category captain to exclude competition and provide an advantage to its own brands. The court ruled that UST’s practices resulted in unlawful monopolization, harming competition, and consequently, the consumers. This example clearly illustrates that category captainship practices might

By working together, retailers can considerably benefit from their manufacturers’ expertise in managing their categories and deliver consumer value through supply chain collaboration.

have negative impact on both the non-captain manufacturers and end consumers. Monopolization in the category may result in lower variety and higher prices, which in turn may harm the consumers. Similarly, many other category captainship arrangements in the tortillas, cranberries, and carbonated soft drinks categories are before the court regarding category captainship misconduct (Desrochers et al. 2003). To summarize, while many retailer-manufacturer dyads claim positive benefits from their category captainship implementations there is also evidence concerning negative impacts of using category captains. Retailers planning to implement category captainship should develop an understanding of the pros and cons of such practices and should potential advantages and disadvantages of using category captains for category management. The goal of this chapter is to provide an overview of the existing research on category captainship, and identify research directions that would improve our understanding of its impact. INDIA |

September 2011 | www.logisticsweek.com

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< pAnoRAmA OFF THE SHELF

Matching Algorithms

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ddressing the need for the study of SCM to evolve at the same pace as its real-world practice, Fundamentals of Supply Chain Theory presents the methodology and foundations of the topic. The authors focus on strategic and tactical aspects of supply chain management, covering a broad range of topics from forecasting, inventory management, and facility location to process flexibility, contracting, and auctions. Key mathematical models for optimizing the design, operation, and evaluation of sup-

ply chains are presented as well as models currently emerging from the research frontier. Each chapter concludes with a set of problems that challenge readers to understand the discussed models. Extensive appendices provide guidance on writing proofs and also outline helpful formulas. Fundamentals of supply chain theory By Lawrence V. Snyder, Zuo-Jun Max Shen Publisher: Wiley Price: `4,898

Solving Real-world Problems

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upply chain management is a rapidly developing field, and the recent improvements in modeling, preprocessing, solution algorithms, and mixed integer programming (MIP) software have made it possible to solve large-scale MIP models of scheduling problems. Featuring a systematic presentation, the book provides MIP modeling and solutions approaches, equipping readers with the knowledge to model and solve real-world supply chain scheduling problems in maketo-order manufacturing. Two main decision-making approaches are discussed and compared throughout. The

integrated approach, in which all required decisions are made simultaneously using complex, monolithic MIP models; and the hierarchical (sequential) approach, in which the required decisions are made successively using hierarchies of simpler and smaller-sized MIP models. Insight is provided using AMPL modeling language and CPLEX solver. scheduling In supply chains using mixed Integer programming By Tadeusz Sawik Publisher: Wiley Price: `5,566

Making Efficient Changes

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his book describes the implementation of autonomous control with multiagent technology. Therewith, it tackles the challenges of supply network management caused by the complexity, the dynamics, and the distribution of logistics processes. The paradigm of autonomous logistics reduces the computational complexity and copes with the dynamics locally by delegating process control to the participating objects. As an example, shipping containers may themselves plan and schedule their way through logistics networks in accordance with objectives imposed by their owners. The technologies enabling autonomous logistics are thoroughly described and reviewed. The presented solution has been

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used in a realistic simulation of real-world container logistics processes. The validation shows that autonomous control is feasible and that it outperforms the previous centralised dispatching approach by significantly increasing the resource utilisation efficiency. Moreover, the multiagent system relieves human dispatchers from dealing with standard cases, giving them more time to solve exceptional cases appropriately. multiagent coordination enabling Autonomous Logistics By Schuldt, Arne Publisher: Springer Price: `6,344

September 2011 | www.logisticsweek.com


BLoGospHeRe Legal teams Assess Risks As Anti-Bribery Legislation Hits Global supply chains Blogger: catherine truel When I recently asked a logistics professional for what he sees as the biggest barrier to trade, he replied ‘corruption’. It’s true that he is operating in a challenging trading environment; but while he said he could deal with imperfect infrastructure, low transport integration, complex regulations; corruption was his biggest headache. It affects one of the most important elements in international trade: predictability. In his opinion, foreign corporations are as guilty as government officials. Could global traders be suffering from a problem they help to create? Perhaps, but not for long: a wave of anti-bribery legislation is rising on the horizon. In practice, there seems to be little awareness of antibribery legislation among global traders. That should quickly change as more countries implement and, more importantly, enforce anti-bribery laws. In the meantime, legal teams in large corporations are looking at their exposure to this risk. Global supply chains are of particular interest with their large numbers of intermediaries: vendors, suppliers, carriers and agents, all potential risks. It is likely that businesses will initiate reviews of supply chain policies. So requirements relating to anti-bribery might appear as a clause in contracts. Furthermore, these conventions are translated in domestic laws with substantial variations. This will create a challenge for companies with legal entities in different countries, as they will

ResouRce centeR Is Multihead Weighing Right For My Product? By Nigel Smith of Ishida Europe Smith looks at the main methods of dosing packs with which multihead weighing competes, and then at multihead weighing itself. Anyone automating a food packing process for the first time, or looking to upgrade an existing entry-level or ‘heritage’ installation, is forced to ask themselves ‘How am I going to get the right amount of product into each pack?’ Separating a set volume of product to add to the pack is one way. The other main approach is to use a set weight (gravimetric filling). In the food industry, one of the commonest volumetric methods allows product to fall into the pack via a rotating screw (auger) system. This approach works at its best with free-flowing powders of regular particle size. Weighing by hand is the most basic of the gravimetric approaches. Clearly it is la-

have to manage various requirements. http://shrvl.com/g54pL

A new Form of supply chain collaboration Blogger: steve Banker Cross functional collaboration has always been a central idea in supply chain management. I will highlight a form of supply chain collaboration that is new to me: supply chain facility design and construction. When it comes to product development, globalization has led companies to engage in co-development projects with key suppliers. Boeing uses a Product Lifecycle Management (PLM) solution from Dassault Systemes as its collaborative platform for product engineering across its core supply base. This allows for faster product development cycles because companies can work on their portion of the product at the same time instead of having to do sequential design and testing. When most people think of R&D, they think of product design. You don’t design oil, for example, you design the oil refinery to process the oil. The collaborative platform tools used in those industries are Process Engineering Tools. Cross-functional and cross-enterprise collaboration will remain at the core of SCm, and these concepts encompass a broader value network than what we have traditionally called “the supply chain.” And with the Internet, mobility, and advanced enterprise cloud applications continuing to march forward, we will continue to see new forms of collaboration. http://shrvl.com/8AS60

Journals, Case Studies, Research Reports bour intensive and slows down production. Product can be fed from a bin into a pack via a feeder. A conveyor belt system, all or part of which is a weighing platform, can be used both to transport product into the pack and to monitor the weight being deposited. Multihead weighing works by separating a product stream out into individual weigh hoppers, controlled by an onboard computer. The chief benefits of multihead weighing are speed and accuracy. Where the product being packed is suitable, no other weighing method approaches the speed and accuracy of multihead weighing. Search Tags: intelligent flow, PLC, airflow unit

Voice Directed Picking: Expected ROI By Tony Beales, Director, Business Computer Projects Ltd The use of voice technology in the warehouse is starting to take off, particularly

for order picking. Voice directed order picking involves the use of a wearable computer with a headset and microphone so that the order pickers are instructed by voice on what items to pick and where to pick them. The wearable computer communicates with the WMS via a radio frequency (RF) LAN. The potential benefits are: Accuracy, Productivity, Removes cost of re-keying order amendments, picking confirmations and catch weights, Real-time feedback for management, and stock updating. The biggest benefits are obtained in low margin, high volume, labor intensive case picking operations, and because of this, the Foodservice Industry and Grocery Retailers and Wholesalers are leading the way in adopting the technology. The biggest cost benefit is increased accuracy. However, the cost of a picking error is underestimated, and differs for wholesalers and for retailers. Search Tags: voice technology, accuracy — Compiled by Jayashree Mendes

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< pAnoRAmA LAuncHpAd Product

HcL Launches cataLoG supply chain platform

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CL Technologies has launched CataLOG, a one-stop supply chain platform jointly developed with eBizNET Solutions Inc., a provider of software-as-a-service (SaaS) supply chain execution solutions. This innovative solution will cater to the unique business needs of the SME segment across the supply chain ecosystem by offering a basket of pre-configured services on a subscription based model. CataLOG is a web-based platform that can be seamlessly accessed by users across the world. The solution ensures a high degree of visibility and transparency into operations as demanded by customers, by leveraging the benefits of a hosted offering along with flexible billing and pricing models. CataLOG enables significant reduction of freight and operational costs by leveraging eBizNET’s expertise in distribution, transportation, reverse logistics & aftermarket services. Key Features:  Useful for SMEs  Seamless access for users globally  Significant reduction of freight Manufacturer: HCL Technologies Selling Point: Flexible billing and pricing models

Solution

3G ocR For port Automation

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hird-generation (3G) technology will now be part of all new Hi Tech Solutions' (HTS) optical character recognition (OCR) systems for use in terminal gate, rail and crane automation and at rail facilities. The new 3G systems combine high resolution megapixel industrial cameras and ultra-strong LED illumination units, running on a GigE network with upgraded software. The systems are programmed to automatically adjust to differing light conditions, making the

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new camera technology capable of capturing high-quality images in a wider range of climate and environmental conditions, including the transition from day to night. The implementation of the 3G systems on an IP platform also reduces infrastructure costs for interfacing and networking OCR systems with remote servers. In ports and terminals where fibre infrastructure has already been implemented, Ethernet is a more cost effective connection to the remote server, as it removes the need for gate lane PCs to be installed in an onsite server room next to each gate. Key Features:  For use in terminal gate, rail and crane automation  Runs on GigE network Manufacturer: Hi Tech Solutions Selling Point: Runs on Ethernet


Imprint Feature

Honeywell Introduces New Class of Mobile Device Dolphin 6000 ®

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oneywell recently launched the Dolphin® 6000 new class of mobile device that bridges the gap between consumer mobile phones, industrial mobile computers and bar code scanners. Shailesh Deshmukh India’s Country Manager Honeywell Scanning & Mobility speaks about the Launch.

simplify data entry tasks. It also has a 3 megapixel color camera and a 2.8 inch color display which will allow manual processes to be even further automated. Ultimately, we want our customers to improve their productivity and lower their operating costs.

How does the Dolphin 6000 address the needs of workers in the logistics industry? Today’s workers require real-time communications and access to critical business data to make informed decisions. Throughout the course of a normal business day, many of these workers utilize multiple devices such as smartphones, VoIP phones, two-way radios, laptop or tablet computers, and bar code scanners. Our Dolphin 6000 rugged Scanphone converges the functionality of these devices into a single, durable, pocketsized device. It is not only delivering multipurpose utility, it is also an affordable price.

But what if issues do arise? Honeywell works to ensure our customers are fully supported. We have a terrific service program called Service Made Simple™. This provides customers comprehensive, hassle-free coverage on normal wear and tear, as well as accidental breakage for up to three years. We also offer Remote MasterMind® - a turnkey remote device management solution that easily manages and tracks usage of installed devices. With this software, users can manage, update and remotely diagnose all Dolphin 6000 devices within a network from one centralized location.

How does the scanphone differ from a regular cell phone? You are able to use the D6000 exactly as a regular cell phone but also gain key productivity advantages with respect to the logistics industry. Similar to most cell phones today, it Incorporates GSM/GPRS cellular, WiFi, Bluetooth and GPS technologies. Plus it is ultra lightweight and pocket-sized. For the workforce, the scanphone has an integrated 1D scanner which provides fast and accurate bar code scanning that will greatly

What about durability? Our scanphone is built tough. It has an IP54 rating which means it can withstand four foot drops to concrete and still be fully functional. Dust, dirt, and water are also not an issue. This will dramatically minimize the amount our customers need to factor in for device repair and replacement costs.

Do you think the Indian market will embrace the Dolphin 6000? Absolutely. There is truly nothing else on the market quite like it. We have designed the Dolphin 6000 with reliability, integration, and exceptional performance in mind. The features on it are designed to lower our customers’ total cost of ownership for a device of this functionality. With the Dolphin 6000, we have effectively bridged the gap between consumer-grade mobile phones and industrial-grade mobile computers. I am confident that workers in the logistics industry are going to find true value and ROI in this product. INDIA |

September 2011 | www.logisticsweek.com 89


< EVENTS

A PUBLICATION OF HAmBUrg mEDIA grOUP

S e p t e m b e r 2 0 11 September 8 and 9, 2011 IndIa OIl and GaS revIew SummIt taj lands end, mumbai Organized by Oil Asia Publications Pvt. Ltd, the India Oil and Gas Review Summit and International Exhibition have entered its 17th edition and targeted at the domestic and international oil & gas industry. It covers the entire petroleum industry and proves to be vital in exploring various related industries also. Exhibitors at the event include: Anticorrosion & corrosion control systems, compressors, exploration and production technology, environmental engineering systems & equipment, fire prevention, gas processing equipment, laboratory instruments & equipment, lubricants, LNG tanker technology, marine equipment and services, offshore construction, oil & gas transportation systems, petrochemical technology, pipeline engineering & equipment, refining technologies. Organized by: Oil Asia Publications Pvt. Ltd Tel: +91 22 40504900 September 9 -11, 2011 Clean ‘n’ Green IndIa expO nSIC exhibition Complex, new delhi Modern day industrialization has led to depreciation of natural resources and damaged the environment. As an effort to promote environment-friendly measures, Redmax Media Pvt Ltd is organizing ‘Clean n Green India Expo’. The event will help spread awareness about the environment amongst Indians, providing them with fresh ideas and insights. Several non-commercial organizations will also participate in this three-day event. The exposition will feature some reputed speakers who will preside over the seminars and conference. Exhibitors include: Plants, flowers and landscaping designs; Eco-friendly and low energy goods, green home furnishings, recycled products, water harvesting system, garbage and waste management, pest control, and wet and dry vacuum cleaners. Organized by: Red Max Media Private Limited Tel: +91 11 65267777 September 9-12, 2011 autO xpO Gandhi maidan, durgapur This is one of the biggest automobile fair in South Bengal comprising both domestic and commercial vehicles along with two wheeler companies, accessories, financial institution and decor segment. This is the fourth Auto-Xpo to be organized by Fabulous 90

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Management Services Private Limited. Exhibitors include: Passenger cars & commercial vehicles, coach & auto bodies builders, two & three wheelers, tyres, car finance, insurance & services alternative fuel & fuel systems, auto accessories, batteries, oil & lubricants, auto components, tools, garage / service station equipment. Organized by: Fabulous Management Services Private Limited Tel: +91 343 6452542 September 14, 2011 InternatIOnal FOOd prOCeSSInG SummIt le meridien, new delhi International Food Processing Summit is dedicated to the Indian processed food, agro and dairy market. The event will be attended by senior experts and reputed speakers who will share their views on industry issues. Latest innovations in technologies and products will be displayed over the course of the event. Delegate Profile: Resorts, ingredients & additives supply, packaging design & consultancy, bakery & confectionery manufacturing, food & beverage manufacturing, grocery, trade associations, research institutions, trading/ retailing, food service institutional & commercial, hotels, restaurants, cafes, bars, clubs, raw materials supply & packaging, supply chain, and supermarkets. Organized by: ASSOCHAM Tel: +91 11 46550581/46550582

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publisher: Jacob Joseph Puthenparambil jacob@logisticsweek.com publishing director: Jayaram Nair jayaram@logisticsweek.com edItOrIal editor: Aanand Pandey aanand@logisticsweek.com editor-Special projects: Pamela Cheema pamela@logisticsweek.com executive editor: Jayashree Mendes jayashree@logisticsweek.com Special Correspondent: Frewin Francis frewin@logisticsweek.com CreatIve Chief designer: Shivasankaran Pillai shiva@logisticsweek.com photography: Ramlath Kavil ad-SaleS Ashok Chand Thakur ashok@logisticsweek.com Dinesh Mishra dinesh@logisticsweek.com eventS events manager: Upendra Kshirsagar upendra@logisticsweek.com marketing Support: Sangeeta D, Suhasini S

September 17-19, 2011 pharmaC IndIa Gujarat university exhibition hall, ahmedabad Pharmac India is a trade fair dedicated to the Indian medical & pharmaceutical industry. This three-day event will be a perfect platform for highlighting the major issues faced by the industry in front of a medical trade oriented and knowledgeable audience. The products displayed will range from herbal medicines to veterinary drug. Advanced machinery used in hospitals and nursing homes will also be showcased at the exhibition. Exhibitor Profile includes: Veterinary drug, medical & disposal, pharmaceutical machinery, flavors & fragrances, diagnostic reagents, excipients / food additives / natural extracts, pharmaceutical formulation, herbal products, dietary supplements, cosmetics products, API active pharma ingredients, and pharmaceutical packaging material. Organized by: Orbitz Exhibitions Private Limited Tel: +91 22 24102801/24102802

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Honeywell’s pocket-sized Dolphin 6000 Scanphone equips mobile information workers with a single multi-purpose device that helps them make informed business decisions at the point of customer service. Honeywell’s new Dolphin® 6000 Scanphone converges the functionality of a smartphone, VoIP phone, two-way radio, laptop or tablet computer, GPS navigation system and bar code scanner into a single, durable, pocket-sized device that delivers multipurpose utility at an affordable price.

For additional information on the Dolphin 6000, please call +91 9820 803 000 or visit www.honeywellaidc.com. © 2011 Honeywell International Inc. All rights reserved.

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LOG.India is the only supply-chain enterprise-user magazine in India and reaches out to large and medium enterprise and SMEs. The content co...

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