MHD Apr 2020

APRIL 2020

THE STATE OF SUPPLY CHAIN

How the nation’s industry depends on resilience, collaboration and flexibility

REDEFINING THE WAREHOUSE

We reveal the trends that are set to shape the future of industrial assets in Australia

COVER STORY

TRUST, PERFORMANCE AND INNOVATION CTI Logistics and Linde’s long-term partnership

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MHD FROM THE EDITOR

MHD Supply Chain Solutions CONTACT MHD Supply Chain Solutions is published by Prime Creative Media 11-15 Buckhurst Street, South Melbourne VIC 3205 Telephone: (+61) 03 9690 8766 Website: www.primecreativemedia.com.au

THE TEAM CEO: John Murphy Publisher: Christine Clancy Group Managing Editor: Sarah Baker Editor: Melanie Stark Journalist: Brittany Coles Business Development Manager: Bowie Phillips Design Production Manager: Michelle Weston Art Director: Blake Storey Graphic Designers: Kerry Pert, Madeline McCarty Client Success Manager: Janine Clements

FOR ADVERTISING OPTIONS Contact: Bowie Phillips bowie.phillips@primecreative.com.au

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ACKNOWLEDGEMENT MHD Supply Chain Solutions magazine is recognised by the Australian Supply Chain Institute, the Chartered Institute of Logistics and Transport Australia, the Supply Chain and Logistics Association of Australia and the Singapore Logistics and Supply Chain Management Society.

COLLABORATION THROUGH CHALLENGING TIMES

O

ver the past few months I have been lucky enough to interview some of Australia’s leading logistics and supply chain professionals, as they reveal their insight, predications and trends for 2020.

Almost every conversation covered how the first quarter of this year has been challenging for those who work in supply chain and logistics.

As we entered 2020, the bushfires brought many regional supply chain operations to a standstill as civilians in affected areas struggled to access the bare essentials throughout the most severe weeks of the crisis.

Australian supply chains bounced back from a period of disruption and uncertainty and continued to service the Australian economy and population, however Coronavirus is now taking its toll on the end-to-end global supply chain.

Most Australian businesses have at the very least some exposure to China, and the effects of this outbreak remain unclear.

One strategy that every single person I spoke to called for was more collaboration. A sentiment that was echoed across each interview was that we need to work closer with our partners and even competitors to increase flexibility and resilience for the greater good of the economy and the people.

Andrew Kirkwood, CEO at BluJay Solutions says that now more than ever organisations should become more mature about collaboration and work together to improve agility, flexibility and ultimately the service they can provide.

He says it’s not just about growing market share, but about collaborating for mutual benefit. Successful supply chain relationships offer more than cost efficiencies and economic conveniences. They offer long-term sustainability and during difficult times can offer support, shared knowledge and expertise when it is most needed.

ARTICLES All articles submitted for publication become the property of the publisher. The Editor reserves the right to adjust any article to conform with the magazine format.

COPYRIGHT MHD magazine is owned by Prime Creative Media.

All material in MHD is copyright and no part may be reproduced or copied in any form or by any means (graphic, electronic or mechanical including information and retrieval systems) without written permission of the publisher. The Editor welcomes contributions but reserves the right to accept or reject any material.

While every effort has been made to ensure the accuracy of information Prime Creative Media will not accept responsibility for errors or omissions or for any consequences arising from reliance on information published. The opinions expressed in MHD are not necessarily the opinions of, or endorsed by the publisher unless otherwise stated.

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

MHD Supply Chain

MHD APRIL 2020 | 3

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APRIL 2020

ISSUE #3 VOLUME 50

THIS ISSUE COVER STORY

COVER STORY

18 A national, long haul partnership

MATERIALS HANDLING 28 Toyota turret trucks a cool choice for air-con maker

E-COMMERCE 34 Changing landscapes 40 Out of home deliveries to surge in Australia

SUPPLY CHAIN

16

21 The state of supply chain 25 Bolstering presence in Australia 46 Equal representation in supply chain 57 Rethinking globalisation

PROPERTY 48 Redefining the warehouse

TECHNOLOGY 42 Smarter cleaning 61 Cyber smart

STORAGE SOLUTIONS 36 Systems beyond safe storage 52 Investing in safer structures

APRIL 2020

THE STATE OF SUPPLY CHAIN

How the nation’s industry depends on resilience, collaboration and flexibility

REDEFINING THE WAREHOUSE

We reveal the trends that are set to shape the future of industrial assets in Australia

24

SAFETY 32 Removing uncertainty around forklift tyre replacement 44 The full picture

DEPARTMENTS AND REGULARS 07 News 64 Women in industry 66 ALC 68 ASCI 70 The last word

COVER STORY

TRUST, PERFORMANCE AND INNOVATION CTI Logistics and Linde’s long-term partnership

ON THE COVER CTI Logistics has operated Linde’s trucks for more than ten years. MHD finds out why the partnership is cruical to the logistics providers success.

36 MHD APRIL 2020 | 5

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MHD NEWS

MEGATRANS2020 postponed

F

ollowing the recent announcement from Victorian Premier Daniel Andrews and the measures that will be taken by the government to mitigate the risk of COVID-19, MEGATRANS exhibition organisers have made the decision to reschedule MEGATRANS2020.

“We want to ensure that we’re delivering the best possible event experience for all attendees and exhibitors. We also take the safety of all our attendees, exhibitors and staff very seriously,” Simon Coburn, Show Director said.

MEGATRANS2020 will now be

held in April 2021, at the Melbourne Convention and Exhibition Centre.

Coles and Woolworths introduce highly automated fulfilment centres

C

oles and Woolworths are partnering with global tech companies to advance their fulfillment capabilities in a bid to meet the growing demand for online groceries, with Coles announcing it will build two new automated fulfilment centres.

The leading Australian supermarket giants have both partnered with external tech companies to highly automate their fulfilment centres.

Woolworths has announced it will house its first Australian “eStore” at the Carrum Downs supermarket in Victoria and Coles has revealed they will build two automated fulfilment

centres in Melbourne and Sydney.

Set to be operational by the middle of the year, the Woolworths eStore will have automated picking technology in a 2,400 square metre facility at the rear of the existing supermarket.

Woolworths partnered with US eGrocery startup, Takeoff Technologies, last year in August to help implement their micro-fulfilment technology.

Using the Carrum Down store’s existing footprint, the automation minimises the space required by using innovative technology that functions in compact vertical spaces.

Its hyperlocal model is designed to

meet this growing demand for online groceries by moving high volume long-life products closer to online customers.

Annette Karantoni, Woolworths eCommerce Director, said the company is seeing rapid growth in online orders so its continuing to look for faster and more flexible delivery options.

“We believe smart fulfilment through our local store network is key to delivering this,” Annette said.

Carrum Downs is one of three initial Woolworths Group sites to trial the capability in 2020. The other confirmed sites are in Auckland and Christchurch, New Zealand.

Woolworths will open its first eStore in Victoria.

MHD APRIL 2020 | 7

MHD NEWS

NHVR explores usage of new technology

T

echnology is allowing the NHVR to modernise the way heavy vehicle safety and productivity services are delivered.

Using the mixture of data and digital platforms, the NHVR is continuing to explore new ways to make it easier to do business for one of the most important industries in Australia.

The most recent leap forward came when the NHVR started integrating heavy vehicle data and information into a secure database known as the Safety and Compliance Regulatory Platform.

NHVR CEO Sal Petroccitto said platform was delivering vastly improved capability and information that would greatly benefit heavy vehicle operations.

“We want to use evidence and insights to be a smarter, more effective regulator,” Sal said.

“This means compliant operators and drivers will be intercepted less frequently and can get on with earning a dollar.

“It’s an important step forward in delivering a highly productive but safer

Technology allows NHVR Officers in regional areas to access data at the roadside.

heavy vehicle industry.

“Put simply, it is allowing us to better target those doing the wrong thing and relieve the burden on those who consistently demonstrate they are doing the right thing,” Mr Petroccitto said.

“The role of technology has been crucial in supporting how we conduct our business.”

The Regulatory Platform was launched last year. It follows hot on

the heel of the NHVR Portal, which supports many of the businesses transactions between the NHVR and operators.

“We have brought vehicle standards, access permits, accreditation and registration services, and even road manager services, into one easy-tomanage system. We’re on track to add Performance Based Standards over the next year.

Vic Government commits to Port Rail Shuttle Network

A

Port Rail Shuttle Network will be key to the Victorian Government’s plans to deliver importers and exporters new efficiencies in their supply chains by moving more freight onto rail.

Rail has been underutilised in Melbourne for short-haul freight operations, with the entire metropolitan freight task currently undertaken by road transport.

Rail is also seen as critical to the Port of Melbourne’s future success as container throughput triples by 2050.

87 per cent of import containers handled by the port travel 8 | MHD APRIL 2020

to a destination less than 50 kilometres from the port.

The proposed Port Rail Shuttle Network would establish terminals in the city’s west, north and potentially the south east, where import containers could be railed prior to delivery by road to their final destinations.

The proposed network promises an efficient alternative to road transport, as well as catering for export and empty containers and – potentially – interstate freight.

The Victorian Government has partnered with the private sector to develop the network.

Rail is critical to Port of Melbourne’s success.

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MHD NEWS

Australia Post fulfils $10.6bn in e-commerce to regional Australia

A

ustralia Post says its economic contribution to regional Australia was $806 million through nearly 36 million parcel deliveries in FY2019.

In a Deloitte Access Economics report released on Tuesday 3rd March, its reveals Australia Post’s contribution specifically to non-metropolitan areas for the first time.

The report states that total value of regional e-commerce was estimated to be $10.6bn in FY2019 and Australia post’s total economic footprint in regional and remote Australia was $806m in gross regional product (GRP).

Survey results indicate that approximately half (49 per cent) of regional Australians are frequent online shoppers, who make an online purchase requiring delivery at least once a month.

“The extensive coverage of Australia Post’s delivery network and availability of different parcel pickup options also facilitates e-commerce activity between different regional,

rural and remote areas,” Deloitte Executives stated in the report.

“The limited availability of alternatives for the fast and reliable delivery of parcels between regional and remote areas means that for many businesses operating outside of metropolitan cities, Australia Post’s delivery infrastructure is essential for

maintaining a high-quality experience for customers residing in other regional communities.”

According to the report, 92 per cent of regional and remote Australians believe Australia Post is important for equity of access to core services and 96 per cent of residents have a local post office.

Half of regional Australians are frequent online shoppers.

Woolworths reveals new $184m temperature-controlled distribution centre

T

he supermarket giant has announced a new state-of the-art temperature-controlled distribution centre in a major Australian capital city.

Woolworths has lodged a Development Application (DA) with the Brisbane City Council for a new 42,000 sqm facility in Heathwood, located southwest of Brisbane’s CBD. At full capacity, more than two million cartons a week will move through the Heathwood DC bringing customers fresh chilled goods from more than 400 suppliers.

The Heathwood Distribution

10 | MHD APRIL 2020

Centre (DC) will be co-located with Woolworths’ meat supplier Hilton Meats’ production facility.

A Woolworths spokesperson said the temperature-controlled facility will enable fresher, faster and more efficient deliveries of frozen and long-life chilled products to around 260 stores across Queensland and northern New South Wales.

The $184m investment in the Heathwood DC is majority funded by LOGOS (property development costs of $148m), with Woolworths signing an initial 15-year lease on the site.

Paul Graham, Woolworths Chief

Supply Chain Officer said the company is pleased to be investing in its Queensland supply chain network.

“This development will help us deliver fresher food to customers, take trucks off Brisbane’s roads, and create new career opportunities for hundreds of Queenslanders and we are excited about this development,” Paul said.

“The extra capacity through the Heathwood DC will be key to supporting our future growth in Queensland for many years to come.”

If approved by Council, the project is expected to create around 200 jobs throughout construction.

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MHD NEWS

BluJay Solutions expands Asia Pacific presence with Australian acquisition

A

global provider of supply chain applications, networks, and data solutions has announced it has acquired an Australian business to expand its presence in the AsiaPacific region.

BluJay Solutions has acquired Expedient Software, a leading provider of customs and forwarding software for the logistics market in Australia and New Zealand.

The Melbourne-based provider, Expedient Software has been in operation for 30 years and was the first logistics software supplier in Australia to provide a cloud-based solution.

Scott Craven, Expedient Software’s

Managing Director said the company will continue to provide efficient software for its customers while gaining the strength of a global company.

“Our customers will benefit from an expanded footprint in Australia, New Zealand, and throughout the region, plus world-class support and infrastructure community, to best serve their needs,” Scott said.

Andrew Kirkwood, CEO of BluJay Solution said the company that is headquartered in Manchester, UK is delighted to welcome Expedient Software’s team and customer base to BluJay. “We continue to strategically invest

in technologies that enable frictionless supply chains for our customers,” Andrew said.

“As a major player in the Australian customs and forwarding market, Expedient brings highly complementary technology to BluJay’s portfolio, along with a knowledgeable team to bolster our presence and expertise in the AsiaPacific market.”

Current Expedient Software customers will experience no changes.

The company will integrate with the global BluJay team, which has Asia-Pacific offices in Australia, New Zealand, Singapore, Hong Kong, China, and India.

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MHD NEWS

Global supply chain solution partners with Fetch Robotics

K

örber Supply Chain has announced its partnership with Fetch Robotics.

Körber’s robotic practice will now be enhanced with its collaboration with Fetch Robotics, a leader in cloud robotics and on-demand automation.

Körber will act as a global reseller, advisor and integrator of Fetch’s AMR solutions and cloud robotics software.

Fetch will have access to Körber’s 1,300 in-house professionals and nearly 100 strategic partners across the globe.

In a joint statement, Körber and Fetch said this assures AMRs are integrated with a sound supply chain strategy – working in tandem with new and existing staff, material handling equipment, and technology.

The companies said along with more

products, suppliers and distribution channels to meet heightening consumer expectations, businesses are faced with global labor challenges.

They stated that many businesses struggle with implementation, integration, maintenance, training and costs and Körber and Fetch are aiming to overcome these challenges.

John Santagate, vice president of robotics at Körber Supply Chain – software said the partnership will extend the automation opportunity for its customers across the wide range of workflows involved in material movements in the warehouse.

“Fetch has a strong portfolio of mobile robots that, when combined with the extensive supply chain knowledge and commitment to

innovation at Körber, creates an optimised approach to flexible automation,” John said.

The Fetch Cloud Robotics Platform provides the market’s only clouddriven Autonomous Mobile Robot (AMR) solution that addresses material handling and data collection for warehousing and intralogistics environments.

Barry Phillips, chief marketing officer at Fetch Robotics said Fetch’s AMR solutions provide almost immediate payback.

“Our AMRs can be fully operational in just days instead of weeks or months across the widest array of distribution and fulfillment operations – including piece picking, case picking, and pallet building,” Barry said.

Making it easier to do business

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www.nhvr.gov.au

MHD NEWS

Australia’s top e-commerce players

T

he top 50 people in e-Commerce were revealed in Melbourne as part of Retail Week 2020.

Mark Teperson, Chief Digital Officer at Accent Group took out the top title of the number one person in Australian e-commerce this year.

Accent Group’s online sales nearly doubled in FY19 under Mark’s leadership, and the company invested heavily into its backend infrastructure to enable faster delivery of online orders through click-and-collect and in-store fulfilment.

“When you can leverage your store network to fulfil orders, and you can make that experience seamless for customers, that is the essence of omnichannel retail, and that’s where the competitive advantage comes into play,” Mark said in the top 50 report.

Judge on the panel and Internet Retailing editor Heather McIlvaine said his commitment to omnichannel retail is not the kind of work that usually makes headlines.

“But his push for a digital hub, so teams don’t sit in silos, and investment in inventory allocation have been key to Accent Group’s seemingly overnight transformation into a digital darling,” Heather said.

The judges panel consisted of 10 experts in the e-commerce field, including Jessica IP, head of commercial and transformation at CouriersPlease and Shannon Ingrey, VP & GM APAC for BigCommerce.

Internet Retailing said the list includes heads of e-commerce at major corporations, such as Shane Lenton, CIO at Cue Clothing Co, Paula Mitchell, group GM of digital at General Pants Co, and Peter Ratcliffe, head of digital at Retail Apparel Group, as well as founder/CEOs of online-only businesses, including Jane Lu of Showpo, Jen Geale of MTB Direct and Justin Dry of Vinomofo.

The judges scored each candidate in four areas: contribution to the commercial success of the business,

14 | MHD APRIL 2020

Mark Teperson, Chief Digital Officer at Accent Group was crowned the number one person in e-commerce. knowledge sharing with the industry, innovation within the business and positive impact on the broader community over the past 12 months.

Each judge was randomly assigned 50 applications to score according to a rubric, and each application was read by five judges. The candidates’ total scores determined their final ranking.

Mark McGinley, CEO of CouriersPlease said significant growth in consumer purchases at online shopping events, technological innovation, improved delivery services and the rising popularity of buy now, pay later services were several positive changes to the e-Commerce industry last year.

CouriersPlease research reveals that 36 per cent of consumers would return an online purchase if the item was worth more than $25.

He said the company is seeing clear trends within the e-commerce space: the rise of pick-up and drop-off (PUDO) networks, which are providing consumers with delivery

certainty and 24/7 convenience, and an increase in click-and- collect and ship-from-store options, which are giving bricks- and-mortar players an advantage over pureplay e-commerce retailers.

Mark said that the trend of free shipping is also continuing, however, an increasing number of consumers are willing to pay for premium delivery services, such as same-day or after-hours options.

“To enable the e-commerce sector to continue to thrive, we need to work together to engage consumers, make it easy for them to purchase and also to receive and return goods and deliver them a seamless shopping experience overall,” Mark said in the top 50 report.

“This year, for the first time, we had two sets of candidates who received the exact same score. Rather than resorting to an arbitrary tie-breaker, we decided they should share the ranking, which is why you will see two 14s and two 43s,” Heather said.

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MHD NEWS

Global retailer joins Toll Group at new logistics hub in Melbourne

G

lobal retailer Uniqlo has secured a 46,000sqm ten-year pre-lease to commence in early 2021 at Midwest Logistics Hub in Truganina in Melbourne’s west.

On completion, Midwest Logistics Hub will be a prime logistics estate in Melbourne valued in excess of $500 million.

Development of Midwest Logistics Hub commenced in October 2019, with the first pre-lease to Toll Group for a temperature controlled 44,000sqm facility to service its fulfilment contract with Mars Wrigley Australia, acting as a distribution centre for storage and dispatch to customers.

The technologically advanced warehouse will store all of Mars Wrigley’s products under one roof for the first time in the company’s history,

with the capacity to store up to 49,000 pallets or more than 700 million MARS® Bars and use Automated Guide Vehicles to move pallets around the warehouse.

Andrew Simons, Charter Hall’s Head of Development, Industrial & Logistics Wrigleysaid Uniqlo’s pre-lease reinforces the changing nature of retail supply chains with the commitment of Fastline Retailing (the owner of Uniqlo), a global leader in the retail industry, to establish their own facility to manage both their existing national store network and their expanding ecommerce business.

Andrew said the facility will consolidate their operations into one purpose-built facility featuring cross dock operations with a super awning, 14.6 metre warehouse clearance height

and container rated hardstand.

50 per cent of the Midwest Logistics Hub estate is now committed.

Richard Mason, CPIF Fund Manager said this can be credited to the estate being in a preferred location for national distribution centres due to its proximity to the port and customers and the area’s large investment in road infrastructure.

All civil and infrastructure works will be completed in June 2020 and the construction of the Toll facility is on track to complete in September 2020.

Each facility at Midwest is targeting a 4 -star Green Star Design and As-Built rating and will incorporate various sustainability initiatives including 100-300kw solar PV systems, LED warehouse lighting and rainwater harvesting.

Australia Post satchels to be made from recycled material

A

ustralia Post has announced that 100 per cent of its entire range of plastic satchels will be made from recycled materials.

The initiative was announced at the National Plastics Summit in Canberra earlier this month and will be in effect by 2021.

Nicole Sheffield, Executive General Manager Community and Consumer said the commitment underlined Australia Post’s drive towards a sustainable future.

“Australia Post continues to incorporate sustainable design principles in the development of our packaging, as we reduce greenhouse gas emissions, non-renewable resource use and water consumption,” she said.

The announcement follows major retailer and Australia Post customer, Country Road, to launch 16 | MHD APRIL 2020

its first recycled plastic satchel in December 2019.

Nicole said as online shopping grows, Australia Post is focused on reducing the quantity of non-recycled packaging that moves through the network.

The new satchel is made of recycled plastic, sending a clear signal to the market that major Australian brands are committed to eliminating the use of virgin plastic across its packaging supply chain.

Australia Post has been a signatory of the Australian Packaging Covenant Organisation (APCO) since 2005, joining other major businesses and Government to set the ambition to achieving national packaging targets.

Since the launch of its Environmental Action Plan in 2018, Australia Post has been incorporating sustainability principles in the design

and production of its packaging, a commitment that is reiterated in its 2020-2022 Group Corporate Responsibility Plan Last year Australia Post also teamed up with REDCycle to offer its customers access to more than 1,800 soft plastics recycling points at major supermarkets across Australia.

Australia Post has committed to reducing the quantity of non-recycled packaging.

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MHD COVER STORY

A NATIONAL, LONG HAUL PARTNERSHIP

The partnership between Linde Material Handling and CTI Logistics is a long-term relationship built on trust, backed by high performance and innovation.

MHD finds out more.

E

stablished in Perth, WA, CTI Logistics has been providing transport, logistics and business services since 1972. Acceleration in growth, especially in the last five years has transformed them into a nationwide transport and logistics company with 28 facilities nationwide, and over 200,000 square metres of warehousing under one roof.

Their operation involves couriers, taxi trucks, parcels, linehaul truck operations, fleet management, 3PL warehousing and supply chain solutions.

18 | MHD APRIL 2020

WHY DID CTI PARTNER WITH LINDE? Although the working relationship has spanned over ten years, what initially attracted CTI Logistics to Linde was the quality and safety of the equipment. Over the course of the relationship the CTI Logistics Linde fleet has expanded into the triple digit dimension, including a wide range of mainstream and specialised Linde equipment.

“A move into contract warehousing was the initial driver which saw the relationship expand and deepen.

That’s when we moved away from two other suppliers for the smaller forklifts we were using. We started to bring Linde forklifts into the business because we found them to be a better product – safe, robust and reliable,” Neil Raspa, General Manager of Supply Chain Logistics at CTI Logistics says.

SUPPLYING TAILORED SOLUTIONS TO AID GROWTH Due to their close working relationship, Linde has been able to develop a comprehensive understanding of CTI Logistics’ needs

MHD COVER STORY

CTI Logistics operates a state-of-the-art facility in WA.

CTI Logistics can see what its fleet is doing on any device, at any time, in any state.

VISIBILITY OVER THEIR ENTIRE FLEET USING FLEETFOCUS

and deliver carefully tailored solutions to aid growth and seasonal peak times. The company’s state of the art 12,000 square metre facility at Forrestfield in WA is a prime example. Using a mixed fleet ranging from Linde hand pallet trucks to 16 tonne capacity forklifts which enables them to achieve their daily 1,000 tonne dispatch requirements.

STRENGTHENING CTI LOGISTICS’ NATIONWIDE CAPACITY Linde’s national network has made things simpler for CTI Logistics, in that they only have to deal with one service provider, allowing Linde to provide a high level of service to meet the different challenges within different states.

“Linde have a strong commitment to us and we are very happy with the relationship.

Their service standards and their response times are excellent. They have experts ready to help in every location, whether to solve a specific challenge around forklifts or what we might need to do for a customer. We’ve found that their national network has really worked for us,” Luke Yeoman, CTI Logistics’ Corporate Services Manager says.

CTI Logistics knows it has to keep up with the modern consumer expectation of same day pick, pack and deliver. As the scale of its operations has grown, the need for effective management of resources spread nationally has also increased.

With the Linde FleetFOCUS solution, CTI Logistics can see what the fleet is doing on any device, at any time, in any state.

“Being a multi-site operation, one of the challenges we have is to get visibility on the whole fleet. With the Linde FleetFOCUS solution we can see what the fleet is doing, the utilisation of each truck, key time on, engine on, lifting times and so on. That gives us a great platform where we can plan for the future,” Yeoman says.

“In our business it is essential that we are delivering constant improvements in safety, efficiency and technology. We are really looking forward to continuing our relationship, and moving forward into the future with Linde.” ■

“

Being a multi-site operation, one of the challenges we have is to get visibility on the whole fleet.

”

CTI Logistics uses Linde equipment for its quality and safety features.

MHD APRIL 2020 | 19

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MHD SUPPLY CHAIN

THE STATE OF SUPPLY CHAIN

This year there is a need to focus and identify strategies to improve technology and automation.

2020 is already proving to be a disruptive year for the global supply chain network. Brittany Coles reports how the nation’s industry will depend on the prowess of supply chain management.

L

ast year, the Logistics Bureau reported that 57 per cent of businesses have poor visibility across their supply chain and many are susceptible to disruptions. Supply chain is the backbone of a commercial enterprise, which is why it is crucial to be strategic in 2020 and focus on management to enhance capabilities.

Through analysis prepared by University of Technology Sydney, The State of Supply Chain Management Report 2020 has informed the Australasian Supply Chain Institute (ASCI) to measure the current status of Australian enterprise supply chains.

In the 21st century companies don’t compete, supply chains compete, Alexandra Riha, ASCI President and Chair of the Board says. The report provides an understanding of the maturity across eight components of supply chain management: Collaboration, Technology and Automation, Integration, Compliance and Regulation, Logistics and Distribution, Risk Management, Sustainability and Procurement.

WHAT IS GOING WRONG? Compared to 2018, the average maturity score out of 100 has reduced six points to 46 from 52. Alexandra Riha, ASCI President and Chair of the Board says this was a huge surprise.

“I was surprised to see in the results that Australia’s maturity score had dropped by 6 per cent. Clearly, it’s time to drive towards a new decade of change,” Alexandra says.

Although members have performed better in technology and automation and compliance and regulation compared to last year, they were performing at the same level for logistics and distribution and underperforming in all other components.

Alexandra believes that this year there is a need to focus and identify strategies MHD APRIL 2020 | 21

MHD SUPPLY CHAIN

Alexandra Riha, ASCI President and Chair of the Board.

“ to improve technology and automation.

Identifying strategies to improve supply chain visibility and adapting to the changes in customer expectations will also help positively change Australia’s maturity score.

Alexandra says the current landscape will challenge progress in supply chain management this year due to disruptions on a global scale.

Australia has seen extreme devastation with recent weather disasters. The unprecedented bushfires across the nation earlier this year saw supply chains come to a standstill, especially in the grocery sector.

Following the bushfire season in February, Coronavirus Disease 2019 (Covid-19) was declared as a public health emergency of international concern by the World Health Organisation. Forced factory closures in China and strict travel restrictions saw a decline in international trade due to a lack of supply.

Transport operators and supply chain management are under pressure to respond to major disruptions and continue to find normality in processes despite recent consequences. This is why Alexandra is calling on the industry to learn from the 2019 results and current strains to dedicate professional measures by implementing supply chain standards.

22 | MHD APRIL 2020

COLLABORATION The state of supply chain management survey conducted by ASCI was responded by a total of 81 industry respondents with a majority of participants organisations operating on a global scale. Supply chains in the 21st Century are decentralised, involving several companies playing different roles in the demand/supply cycle.

No single entity has control of materials, resources, strategy, or service quality.

According to the survey results, only 27 per cent of respondents consider collaboration to be essential across the board for the organisation. ASCI says that under such circumstances, collaboration is the only way to unify the supply chain.

Decisions in one part of a supply chain system impact results and processes in multiple other areas. To drive supply chain value through collaboration, supply chain leaders must understand and manage the end-to-end system.

TECHNOLOGY AND AUTOMATION Alexandra says there is so much happening in automotive advancements that it can be overwhelming. However, she says that using excel spreadsheets is now an outdated process and as an industry it’s time to invest in technological capabilities that will

This year there is a need to focus and identify strategies to improve technology and automation.

Identifying strategies to improve supply chain visibility and adapting to the changes in customer expectations will also help positively change Australia’s maturity score.

”

MHD SUPPLY CHAIN be a cost-effective investment which will lead to higher productivity and profitability.

As seen from the 2019 survey results, 18 per cent of the respondents have seen a reduction in costs, while 16 per cent consider technology has supported the business in predictive and lead indicator analysis and 15 per cent have seen an improvement in the process optimisation.

Alexandra says cloud computing is one of the technologies that organisations consider to be a key in their supply chain integration planning, with 47 per cent of respondents currently have the technology implemented.

Only 14 per cent of respondents have a fully digitised supply chain strategy in place. Alexandra says organisations need to be ready and able to move quickly, knowing technology usually advances faster than business change. Benchmark companies believe that robotics will have the most immediate impact on the supply chain, followed by driverless trucks, drones, wearable technology and 3D printing.

IMPROVING THE HEALTH OF THE SUPPLY CHAIN The 2019 survey results showed that 55 per cent of the respondents are still lacking a sustainable strategy for their organisation’s supply chain. Alexandra says organisations are striving to operate in a more sustainable manner and there is no denying that going green and being environmentally friendly is the way of the future. She says it’s important to have a comprehensive understanding of the sustainability

“

It’s important to have a comprehensive understanding of the sustainability impacts of your supply chain by improving communication, have set compliance standards and collect data from suppliers.

”

impacts of your supply chain by improving communication, have set compliance standards and collect data from suppliers.

Alexandra says organisations should have good procurement practices including maintaining a healthy supplier-consumer relationship even when transactions aren’t taking place. Engaging in collaborative strategic sourcing examines the whole supply network and procurement process which take into account risks, value creation, supply chain uncertainty and the process’s overall impact on the organisation. Results from the survey also recommend organisations should place significant attention to training personnel on supply chain policy, procedures and application management, operational and technical controls and practices.

ASCI recognise that supply chain is one of the key industry sectors which is very widely intertwined with other industry sectors. ASCI is transitioning to be the Professional Accreditation Body for Supply Chain Management and is aiming to establish standards to enhance quality in the supply chain workforce. This year, Alexandra says, it’s time to work on a wellrounded compliance solution that aids in complying with specific regulations but leverages accurate data through good due diligence practices.

ASCI stated that clearly the Australian enterprises need to execute and design strategies to make Australian supply chain more effective, efficient, sustainable and robust in 2020 and beyond. ■

Supply chain leaders must understand and manage the end-to-end system.

MHD APRIL 2020 | 23

MHD SUPPLY CHAIN

Andrew has an extensive career working across various supply chain solutions providers.

BOLSTERING PRESENCE IN AUSTRALIA MHD sits down with Andrew Kirkwood, CEO and Katie Kinraid, General Manager APAC at BluJay Solutions as they visit Australia following the announcement of a major acquisition in the region.

A

ndrew Kirkwood, CEO at BluJay Solutions is based in the UK. He has an extensive career in the supply chain, working for some of the industry’s largest providers of supply chain solutions including Manhattan Associates and JDA Software.

He joined BluJay Solutions just over a year ago and his role is to lead the organisation through a period of growth.

“I’ve come onboard to put the infrastructure in place to help the organisation grow organically and inorganically,” he says.

Andrew has held senior roles in a number of billion-dollar organisations, as a result 24 | MHD APRIL 2020

he is very well placed to lead BluJay through this next phase of growth.

For the past year, Andrew has spent a large amount of his time speaking to customers and finding out where they are going, how they operate and what areas they want BluJay to develop.

“We want to be more than an applications solutions provider, so I have been speaking with our customers about what they think the market needs from a supply chain solutions provider,” he says.

DATA, NETWORK, APPLICATION BluJay Solutions shapes its offering around

MHD SUPPLY CHAIN the principles of Data, Network and Applications (DNA). Andrew breaks these values down and explains data is leveraging information to make better decisions across the supply chain, network is about the interoperability between systems and application is transport management and customs processes.

“We have invested a lot in providing data that our customers can use to benchmark themselves against each other. We recently launched our Freight Market Index which provides transportation market intelligence for shippers, carriers and industry professionals,” he says.

The Freight Market Index is comprised of an elaborate set of key performance indicators (KPIs) derived from the $18 billion industry that BluJay transacts across its global trade network. It contains real-time data that is published monthly with independent expert commentary on quarterly basis.

According to Katie Kinraid, General Manager APAC at BluJay Solutions the company is very well placed to offer this kind of insight. “We’re capturing so much information around the world, that we’re in a very good position to analyse this and offer valuable industry insight,” she says.

COLLABORATION AND MATURITY Andrew says that part of BluJay’s recent developments have been down to the organisation reaching a high level of maturity when it comes to collaboration.

“We recognise that we can’t be all things to all people. We have great intellectual property, insight and innovation, but we recognise that we need to collaborate with others in the same space, and this includes our competitors,” he says.

For Andrew, if you don’t collaborate you risk having inefficiencies across your supply chain.

“We want to drive collaboration so that we can accelerate even more with regards to innovation for our customers. We want to change the way that people operate and open up with regards to sharing networks, data and insight,” he says.

“

We want to change the way that people operate and open up with regards to sharing networks, data and insight.

”

Katie Kinraid, General Manager APAC at BluJay Solutions.

This similarity presents an opportunity for Australia to really lead the way when it comes to logistics, Katie says. “With Australia being a couple of years behind the European e-commerce market, we see this as a great opportunity to pitch what works well in the UK to Australian businesses. There are a lot of lessons that have already been learned in the UK that we can avoid here in Australia and New Zealand,” she says.

INVESTED IN AUSTRALIA BluJay has been operating in Australia and New Zealand since the mid 90s and according to Katie, the organisation is very strong in the logistics, shipping and e-commerce sectors.

Andrew says there are some nuances shared across Australia and the US in terms of a large spread of geographical area. However, for him, Australian consumers are more closely aligned with British consumers.

BluJay Solutions is a market leader in network solutions and supply chain management.

MHD APRIL 2020 | 25

MHD SUPPLY CHAIN Andrew echoes this sentiment and says that in Europe there has been a mood of discontent from consumers with regards to service level agreements not being met. “One area that you really need to get right is delivering on your promises. Having convenient options for delivery is great, but you have to deliver on this,” he says.

Katie also says there has been a shift in the consumer’s role in the logistics process.

“Consumers are now expected to take some ownership regarding their role in the delivery.

They are presented with a message or email before a delivery to respond whether they will be home or not and they are starting to understand how critical it is that they own this role and be home when they say they will be,” she says.

BluJay recently acquired Expedient Software, a Melbourne-based provider of customs and forwarding software for the logistics market in Australia and New Zealand.

Expedient Software has been in operation for 30 years and was the first logistics software supplier in Australia to provide a cloud-based solution.

According to Andrew, this acquisition was a direct result of feedback from the market as well as part of BluJay’s larger strategy of growing its market-share in Australia and New Zealand. “Many of our customers told

BluJay Solutions aquired Expedient Software in March this year to broaden its customs and forwarding technology offerings.

26 | MHD APRIL 2020

us they wanted us to expand in this area of customs and forwarding. They told us they wanted an alternative to WiseTech and we listened,” he says.

Expedient Software has its headquarters in Melbourne, which was also attractive to BluJay. “We really wanted a base here in Melbourne, as well as a local provider in this area of business,” he says.

Part of BluJay’s strategy is to ensure that it mirrors its global enterprise offering for more local markets, and this acquisition fits perfectly into this strategy.

“We have our enterprise forwarding solution for our multi-nationals, but this is specifically for our more local customers in Australia and New Zealand. We know that those enterprise solutions don’t suit our smaller or medium size customers so we invested in a company that we know can provide that kind of service to these customers,” Andrew says.

Andrew says that Australia is very wellpositioned for growth and he’s excited to see this region develop. “I think Australia underestimates how sophisticated it is. It’s a very sophisticated economy here and I am excited by the opportunity to grow here and improve resilience and efficiencies for supply chains throughout Australia and New Zealand,” he says. ■

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MHD MATERIALS HANDLING

TOYOTA TURRET TRUCKS A COOL CHOICE FOR AIR-CON MAKER Toyota Material Handling Australia has partnered with national air-conditioning manufacturer, ActronAir, to help plan the material handling requirements and provide equipment for its new warehouse.

A

pair of Toyota BT Vector VCE150A turret trucks are at the heart of a new 21-strong all-electric fleet of Toyota Material Handling equipment chosen by ActronAir for the new expanded warehouse and distribution facility.

Renowned for its energy-efficient products, ActronAir started as a family business in a garage in Winston Hills 34 years ago and has grown to have branches throughout Australia.

It remains 100 percent Australian-owned.

ActronAir national warehouse and logistics manager, Mark Horan, says the need for a new headquarters and accompanying equipment rose from the business’ constant growth.

“Our old site was opened at Bella Vista 15 years ago. “With double-digit growth in

manufacturing over six of the past eight years, we have grown quickly and remain focused on being a superior heating and cooling solutions brand.

“Our new warehouse at Marsden Park is 2.5 times the size of our old one, but even with the new 25,000 square-metre facility we still needed to use the space as efficiently and productively as possible.

“We knew of course that to squeeze out every bit of usable warehousing space we needed very narrow aisles and to rack as highly - as safely - possible. However, our business is quite unique in that a lot of our air-conditioning equipment is custom-made and requires non-standard pallet sizes and storage racks.”

Accordingly, ActronAir sought a material

The Actron Air and Toyota partnership is a meeting of minds, Mark Horan says.

“

We knew of course that to squeeze out every bit of usable warehousing space we needed very narrow aisles and to rack as highly - as safely - possible.

ActronAir started as a family business 34 years ago.

28 | MHD APRIL 2020

”

MHD MATERIALS HANDLING

“ handling partner with reputation and credentials to advise on the specialised equipment required to meet its goals. “One of our key values is ease-of doing business, it’s in our mission statement and one of the things we hang our hat on,” he says.

“We found with Toyota there was a meeting of minds. Nothing was a problem, they are easy to deal with and we had good, clear communication both ways. It was important to have a like-minded partner with similar values.”

Unusually, the Toyota BT turret trucks and other Toyota Material Handling equipment was specified and optioned before any ground was broken to build the warehouse.

“Unlike other places where you design and build your storage system and then put in your material handling equipment, we went the other way around,” Mark says. “The detailed design for the warehouse was set around the capabilities of the equipment. So the Toyota turret trucks did help optimise the warehouse design.”

With tight and accurate turning between aisles, the Toyota BT Vector VCE150A turret trucks bring full very narrow aisle (VNA) functionality in an extremely compact

footprint, and have a choice of chassis and cab widths.

Toyota Material Handling Australia Product Manager (Warehouse Equipment), Michael Marks, says that the collaborative process with ActronAir is an excellent example of a key pillar of the Toyota Advantage - Tailored Business Solutions being put into practice. “We pride ourselves on the flexibility we can provide our customers and in the case of ActronAir many things were highly specific to its business,” Michael says. “The individual approach we take to providing tailored business solutions equates to substantial reductions in operating costs through greater efficiencies.

We’re actually very proud of being able increase productivity for our customers.”

Putting the Tailored Business Solutions Toyota Advantage into effect in this instance required a considerable amount of data capture, analysis and technical programming. “Ensuring the most appropriate and efficient specifications for ActronAir’s warehousing needs required a lot of data collection,” Michael says. We had multiple technicians on site on many occasions - and our programmers working

We found with Toyota there was a meeting of minds. Nothing was a problem, they are easy to deal with and we had good, clear communication both ways. It was important to have a like-minded partner with similar values.

”

MHD APRIL 2020 | 29

MHD MATERIALS HANDLING behind the scenes to ensure the dimensions were down to the millimetre.”

Another example of TMHA’s Tailored Business Solutions in practice included arrangements for ActronAir to experience its turret trucks operating first-hand at another Toyota BT turret truck customer’s site.

Oz Design Furniture, granted ActronAir a visit to its nearby Rouse Hill site. “That was especially useful because given the varied nature of their products they also used nonstandardised sizes,” Mark says.

“Their operation was quite similar to what we had in mind in terms of a VNA distribution centre. Experiencing that first-hand and seeing how it could practically benefit our business was pretty cool and very generous of Oz Design. It was a big plus for us.”

In another display of putting the Toyota Advantage of Tailored Business Solutions to work, Michael Marks says TMHA also departed with convention to assist ActronAir in meeting the warehouse’s go-live date.

“The Toyota turret trucks were already on order but the roll-out was tight, so rather than take delivery of them at our Moorebank headquarters, as usual, we assembled and configured them on site at ActronAir to get them operational as quickly as possible,” Michael says.

Now that the Toyota turret trucks are running, Mark says his operators enjoy driving them. “Our guys love them. They appreciate their ease-of-use and efficiency, they think they’re really stylish and sophisticated.

“They also know that every time they need one it’s going to be ready for work. The value of reliability can’t be underestimated in our business.”

Other Toyota Material handling equipment

Toyota’s trucks have been a huge plus for ActronAir.

specified by ActronAir includes: 12 x Toyota BT Reflex RRE160H high reach forklift trucks; five x OSE120CB low-level ride-on pallet-runner/order-picker; one x 8FBJ35 and one x 8FBN30 counterbalance 4-wheel forklifts.

For more information freecall 1800 425 438 or visit www.toyotamaterialhandling.com.au ■

“

The value of reliability can’t be underestimated in our business.

” The drivers at ActronAir enjoy driving Toyota’s trucks.

30 | MHD APRIL 2020

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MHD SAFETY

REMOVING UNCERTAINTY AROUND FORKLIFT TYRE REPLACEMENT Paul Hansen at Trelleborg Wheel Systems Australia presents a new innovation where there is a 100 per cent accurate way to indicate when forklift tyres need to be replaced.

One of the industry’s most critical questions is knowing when to replace a forklift tyre.

F

orklifts are fundamental in the logistics and warehouse environment, one of the most utilised pieces of equipment, they are a powerful tool that aid the movement of and storage of goods efficiently and safely.

However, one of the industry’s most critical questions is knowing when a solid/resilient forklift tyre has reached the manufacturers maximum wear 32 | MHD APRIL 2020

limit and needs to be replaced.

“Not knowing exactly when these tyres need to be replaced has been costing the industry thousands of dollars in replacing tyres that could still have usable of tread rubber on them,” Paul Hansen, Sales Director, Trelleborg Wheel Systems Australia says.

Solid/resilient tyres are often replaced with up to 25 per cent of their

tread rubber remaining simply because the tread pattern has been worn off.

Once the tread disappears, there is usually an argument between different departments regarding when it should be replaced. “Safety have their agenda of being as safe and compliant as possible and operations need to make sure everything is running as efficiently and cost-effectively as possible,” Paul says.

This ambiguity leads to customers replacing tyres before the manufacturers maximum wear point is reached, effecting the total cost of ownership of the tyre.

This has a number of issues, firstly there is the cost of replacing tyres too early when there are more operational hours of use to be gained, secondly there is the environmental impact of putting a tyre into landfill or similar when it could still be used. Thirdly there is the very serious safety issue of keeping tyres on the forklift after they should be replaced.

Trelleborg Wheel Systems has developed a solution to completely remove the ambiguity around when a solid/resilient forklift tyre needs to be replaced.

MHD SAFETY

If a tyre is replaced early, it effects the total cost of ownership.

The ‘Pit Stop Line’, incorporated into Trelleborg’s premium range of solid/ resilient tyres in 2014, features a highly visible orange line that is embedded into the tyre. The line reveals itself around the surface of the tyre to let operators know that it should be replaced within the 100 hours of usage, eliminating the risk of replacing tyres too early or too late.

“We wanted to ensure customers had a visual indication of when the tyre was approaching its maximum wear life, with enough time to program in the replacement so as to reduce downtime to a minimum,” Paul says.

“This ensures that our customers have received maximum value for their money”.

Since launching the solution here in Australia Paul says the reception has been

fantastic. “Trelleborg tyres manufactured with the Pit Stop Line are a must have for any organisation that takes safety seriously and wants to realise the lowest operating costs when it comes to tyres on their material handling equipment.” ■

Trelleborg tyres give users complete confidence regarding when a tyre needs to be changed.

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MHD E-COMMERCE

CHANGING LANDSCAPES Online sales continue to change the way we shop, as a result retailers and logistics providers are having to radically adapt their service offerings. Ben Franzi, General Manager, Parcel & Express Services at Australia Post presents some of the trends that are set to shape the future of e-commerce in Australia.

“

Over the past five years, e-commerce growth has doubled.

We’re now looking at 10 per cent annual growth.

”

A

ustralian e-commerce sales continued to boom throughout 2019, with Australia Post’s E-Commerce Update 2020 revealing a 17.2 per cent year on year increase. Black Friday and Cyber Monday saw enormous growth, as retailers offers extended well beyond the individual shopping days, with some retailers offering week-long offers and discounts.

The report also revealed that Victoria outperformed the rest of Australia with 19.9 per cent year on year growth and South Australia was second with 16.9 per cent year on year growth.

Black Friday and Cyber Monday week was the largest online shopping period for the second year running, growing 31.6 per cent in 2019. Variety stores and fashion and apparel saw above average growth with 22.3 per cent and 20.9 per cent respectively.

One of the key trends of the report found

Next business day deliveries grew by 21.1 per cent in 2019.

34 | MHD APRIL 2020

that speed was increasingly important when it came to delivery of goods. Next business day deliveries grew above average, up by 21.1 per cent year on year.

This increase is a trend that has been continuing for the past five years, Ben Franzi, General Manager, Parcel & Express Services, Australia Post says.

“Over the last five years, the growth has doubled. We’re now looking at 10 per cent annual growth,” he says.

Ben is responsible for providing worldclass parcel and e-commerce services to Australia’s local and international customers. He has significant expertise in the e-commerce industry and has been working at Australia Post for more than 18 years. Ben has been working with e-commerce solutions in some shape or form for the past eight years and leads a team that creates data and insights to help Australian businesses maintain a competitive advantage.

He attributes a lot of the recent e-commerce growth in Australia to the larger retailers establishing a more sophisticated online offering. “The big retailers, such as Kmart, Myer Target, didn’t quite have everything ready to meet the consumer demand. But in the past year, they have really started to grow their e-commerce offering,” he says.

This is largely due to the pace that Amazon has set, Ben says. “The level of service that Amazon can offer has really influenced other retailers to up their game in Australia.”

Ben says the days of consumers not knowing, or even caring, when their order will turn up are long gone. “They want full visibility now, the want to know when, where and how their order is going to arrive.”

He refers to this as the Uberisation of the delivery experience. However, he does

MHD E-COMMERCE acknowledge that this consumer demand is putting a lot of pressure on the retailers.

“All these trends are working against the profitability of the retailer. It’s having a massive commercial impact on them. We’re continuing to see the closure of large-scale retailers and I wonder how we can work on rebalancing this trend?” Ben asks.

Ben wonders whether there will be a shift to more environmental and sustainable delivery options as the next generation come of age. He says, it is clear that this is a cause that they care about and it will be interesting to see how this affects their shopping behaviour.

“Once this generation has more disposable income and a larger share of the consumer spend, I wonder if we will start to see sustainability at the top of the agenda for retailers. They may use this as a marketing opportunity and offer more sustainable options to their consumers rather than driving for faster and cheaper delivery at the cost of the environment,” he says.

Australia Post’s report offers some recommendations for planning ahead for 2020. These include evaluating what went

Larger retailers in Australia now offer a sophisticated online shopping experience.

well last year and what could have gone better, preparing plans and forecasts to share with partners and suppliers, looking at the choice of delivery options on offer, making speed a point of difference and locking in the required technology. ■

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MHD STORAGE SOLUTIONS

SYSTEMS BEYOND SAFE STORAGE Safer Storage Systems has engineered and reconfigured warehouse storage solutions for some of Australia’s most trusted retailers including Reece plumbing, JB HI-FI and Dulux. Brittany Coles reports how the business is putting Australian manufacturing back on the map. over 100,000 people. When compared to the international landscape, this pattern is not the norm. Matt says Safer Storage Systems is proud to be one of the few racking companies manufactured in Australia and is passionate about growing Australia’s manufacturing presence through the company’s new global partnership with Gonvarri Material Handling (GMH).

“We like to consider ourselves as the biggest racking company you’ve never heard of,” Matt says.

Safer Storage Systems provides ongoing scalable solutions to some of Australia’s most trusted retailers including Reece plumbing, JB HI-FI, Dulux and Footlocker. Its solutions range from $500 pallet racking fitting to $5 million. The company, which has been operational for the past 14 years, believes that warehouses are just for keeping the rain off the storage solutions inside, which are the number one asset for efficient operations.

GLOBAL PRESENCE FOR LOCAL ATTENDANCE From left to right: Matt Bell, Tony Bell and James Hardy.

T

he increasing number of warehouses and distribution centres in Australia is driving global industrial racking systems.

The boost in the e-commerce sector and rise in automated material handling equipment has made the racking market a competitive landscape. Customers are wanting industrial racking systems installed by a company who can offer the most cost-effective and fastest method.

However, Matt Bell, Managing 36 | MHD APRIL 2020

Director and James Hardy, Sales Director at Safer Storage Systems says rather than agreeing to fit a stock stand racking system, the primary focus should be on finding the right solution that is customised to what the customer needs.

According to a 2019 Transforming Australian Manufacturing report by PwC, the last 30 years have seen a reduction in the size of the Australian manufacturing workforce. In the last decade, the workforce decreased by

Matt and James have worked on the tools and have been involved in the industry for over 25 years. Matt says he knows the importance of the customer requiring a good quality experience all the way through from design to the completion of the job.

Partnership is highly valuable for Safer Storage Systems, which is why they teamed up with Gonvarri Material Handling (GMH) last year.

World leading provider of industrial storage systems, GMH, is a division of Gonvarri Steel Services. The European company’s five business lines operating as Gonvarri Industries

MHD STORAGE SOLUTIONS are estimated to be worth over €3 billion (AU$4.9 billion). James says that GMH has a product range that suits Safer Storage Systems well, providing them with direct access to manufactured products with no additional margins.

“We’re proud to be an independent business and distribute the global GMH range to our customers,” James says. He explains that the global giant never saw Australia as a target market when they approached GMH. Since forming the partnership last year, Safer Storage Systems has become GMH’s biggest export partner outside Europe.

Due to the Australian company’s exclusive access to the GMH product range, they have imported materials from Germany, Romania and Finland.

This enables Safer Storage Systems to manufacture customised solutions including static and dynamic pallet racking, mobile racking, fully automated pallet shuttle systems and vertical lift machines.

Matt says Australia’s presence in the market has weakened due to the demands to keep up with international manufacturing speeds.

With recent government interventions and currency shifts, local manufacturing is highly competitive.

He says Safer Storage Systems’ focus is on manufacturing a high quality and efficient product, but above all, offering customers an entire qualified solution from its sizeable product range that extends beyond pallet racking.

a step back, analyse their data, understand their logic and get a snapshot of stock on hand, the fundamentals in warehouse design” James says.

Safer Storage Systems base their recommendations for customers on warehouse design, data, observation and logic. “It can be a scary thing for customers, because we can end up knowing more about their business then they do,” James says. Following an in-depth analysis of past and current operations, the team at Safer Storage Systems figure out the best solution to achieve the customer’s desired results.

“A lot of companies try to keep

racking to a standard size because it suits its manufacturing, whereas sometimes the solution for a customer isn’t a standard size.

That’s why having a scalable solution according to every customer’s needs sets us apart from the rest,” Matt says.

“We use a different logic, examining efficient operational processes. We don’t ignore customer requirements for the sake of flipping some steel. We tell customers that they may not need to install all at once, it can be phased in and scalable to the future as the business and warehouse demands grow,” James says.

ENGAGED AND CUSTOMISED Typically, once a customer identifies how many pallets required, the weight and dimensions of the rack they need, they’re usually after the fastest and cheapest option James says, which isn’t the ideal approach.

Matt agrees with James in saying that decision may not be qualified. James says there is a process to go through in order to come to an efficient end solution and it’s about staying involved and staying engaged with the customer.

“We concentrated on the principle of balancing productivity with storage. Ideally, before we even think about designing the warehouse layout, our first process is to take

Safer Storage Systems provides safety solutions to some of Australia’s largest retailers.

MHD APRIL 2020 | 37

MHD STORAGE SOLUTIONS

The Safer Storage team are onsite at more than 50 locations a day, helping major customers with their storage solutions.

QUALIFIED AND INDEPENDENT As time goes on and businesses evolve, Matt and James say the Safer Storage Systems team continue to work with clients to grow their capabilities. Safer Storage Systems has found that most customers are tired of being offered the same standard racking layout, and it’s about offering the one solution they need.

Safer Storage Systems is currently adding value to JB HI-FI’s new $44 million distribution centre in Truganina, Victoria following the successful solutions implemented at the home entertainment retailer’s distribution centre in Sydney.

“JB HI-FI is an interesting client as they require a minimal amount of pallet racking. Through labelling, line marking, guard rails and walkway protection we are giving them a fully functional storage solution, not just pallet racks,” Matt says.

Safer Storage Systems can be looking after up to 250 stores nationwide for major accounts and have a dedicated team on location at over 50 sites a day. The team visits previous sites of clients, assists in the deconstruction of the old racking and recycles the asset to be reused again. “We’re not 38 | MHD APRIL 2020

“

We use a different logic, examining efficient operational processes.

We don’t ignore customer requirements for the sake of flipping some steel. We tell customers that they may not need to install all at once, it can be phased in and scalable to the future as the business and warehouse demands grow.

”

just doing the layout, we’ll hold their hand all the way to execution, down to traffic management plans and servicing our automation systems,” James says.

“The most important part of installing a new solution are the years to come to ensure services, maintenance and smooth operation processes are in place for the customer,” James says. Safer Storage Systems has seen an increase in

semi-automation systems for pallets including mobile and pallet shuttle racking, especially in temperaturecontrolled environments, vertical lift modules and autonomous mobile robots (AMRs) for high density picking where goods to person solutions are increasing.

“With the increase in semiautomated solutions, it is important to have a national support network which guarantees local support and response quickly. We operate strong “RAM” principles, reliability, availability and maintainability, which is critical in supporting these systems,” James Says.

“Our move in the market is very deliberate. Customers engage with us because they want a qualified solution with future capabilities, and our ability to reconfigure a whole warehouse with storage systems becomes their best value.”

“We’re proud to manufacture quality products right here in Australia. We use high quality steel and manufacturing processes that exceed Australian standards. We track coil to projects and have a robust QC program, our customers know we do things thoroughly and properly,” Matt says. ■

MHD E-COMMERCE

OUT-OF-HOME DELIVERIES TO SURGE IN AUSTRALIA Australia’s traditional retail landscape is changing with the rapid growth of e-commerce. Marek Rozycki, former Vice President of Amazon Logistics Europe shares how the industry and consumers can navigate through logistical problems via out-of-home deliveries.

O

ut-of-home deliveries will grow significantly in Australia, solving important logistical problems for retailers, carriers, and consumers across the nation.

According to Marek Rozycki, Managing Partner at Last Mile Experts and former Vice President of Amazon Logistics Europe out-of-home deliveries will very soon make up a significant component of the last-mile market.

because it is currently the only way to manage massive volume growth without excessive service failures and cost.”

In his keynote address at the Hubbed ‘Future of PUDO Conference’ in Sydney last week, Marek said many consumers feel that home delivery methods are outdated, parcel collection point networks such as Hubbed are growing because they guarantee successful firsttime deliveries and increase delivery density to collection points – both

A customer can opt to leave a parcel with a neighbour.

Marek Rozycki, says that the cost of the last-mile accounts for approximately 41 per cent of supply chain costs.

“Out-of-home delivery is becoming crucial for the delivery sector because it offers a virtually guaranteed first-time delivery solution,” he says.

“It is also increasingly important to the overall consumer experience 40 | MHD APRIL 2020

reducing costs for carriers.

According to UBS’s Evidence Lab report, online retails sales in Australia have grown at a 14 per cent (compound annual growth rate) for the past three years, and now make up around 9 per cent of retail sales.

Due to the ongoing surge in online sales, Marek predicts the three areas of

out-of-home deliveries that will grow in Australia will be lockers, collection point networks, and click and collect services.

“In-store click and collect offerings also have plenty of space to grow, especially as consumers become increasingly environmentally driven in their choices and embrace greater control and convenience,” he says.

“By giving customers what they want, e-tailers can also build loyalty and drive income. In fact, the research shows that almost two-thirds of customers spend more when they use click and collect.”

David McLean, Founder and CEO of Hubbed says customers are expecting higher levels of service and choice when it comes to eCommerce.

“They are demanding more control post the purchase experience and this obviously includes delivery and collection,” he says.

“Coupled with the demand for more environmentally friendly options, means that sustainable shopping now extends to sustainable shipping.

Pick-up drop-off (PUDO) and collection points, such as Hubbed, which has more than 2000 locations nationally, support this process from the get-go.”

In Australia Post’s 2020 E-Commerce Update, research showed that online purchases grew by a staggering 17.2 per cent year on year.

The analysis of shoppers’ behaviours that emerged in 2019 indicated that consumers also took advantage of alternate delivery options, with deliveries to Post Offices and Parcel

MHD E-COMMERCE Lockers proving popular with 33.2 per cent growth year on year (YOY).

Australia Post General Manager Parcel & Express Services, Ben Franzi says the company saw a higher demand for parcels to be delivered quickly in 2019, with next business day deliveries up 21 per cent YOY. He said that many Australians love to shop for clothing and apparel and they want it as soon as possible, accounting for 59 per cent of next business day deliveries.

Research has shown that more Australians are shopping online than ever before, as online sale events are dictating shopper spending, the demand for efficient delivery services is paramount as e-commerce continues to thrive.

Marek’s seven international trends in last mile delivery that could be seen in Australia:

1.IN-STORE CLICK-ANDCOLLECT ‘DRIVE-THRU’ Marek forecasts continued growth for click and collect parcels in the future,

especially at major supermarkets or grocery stores. In some cases, employees will bring the packages out to individuals waiting in their cars or a specified pick-up location via a ‘drivethru’ type model.

2. SMART LOCKS THAT POWER IN-HOME AND IN-GARAGE DELIVERY Delivery drivers might soon be able to leave parcels in the home, garage or other secure locations via smart locks.

For this type of delivery, homeowners would be notified when the delivery driver has arrived, and they would provide permission for them to access the property to make the delivery.

4. AGVS Robots, or ‘bots’, are being tested in various places but will still take time to be used at scale.

5. LEAVE WITH A NEIGHBOUR OR ‘SAFE DROP’ This method can be utilised in cases where a parcel is being delivered to the home, when the customer is out.

In these instances, the customer can elect to have their parcel left with a neighbour or a pre-determined location that they deem is safe.

6. UAVS (DRONES)

3. IN-FRIDGE DELIVERY

Delivery providers are already utilising drones for specialist deliveries. As with AGV’s, it will take time before this happens at scale.

Would you let delivery drivers enter your home to place food deliveries in the fridge? Maybe not. However, Marek believes that this method of delivery will become possible via smart locks and drivers with cameras, allowing the consignee to see what is happening throughout the delivery.

This would allow consumers to have suitable products 3D printed at local access points, which will have the potential to “drastically reduce the movement of freight in urban areas”, says Marek. ■

7. 3D PRINTING

Oxford Cold Storage isn’t alone in experiencing a constant stream of cost pressures. With retailers dropping prices for their consumers, flow-on austerity down the chain means tighter margins for distribution companies.

For Oxford Cold Storage, implementing a fleet of Automated Guided Vehicles (AGVs) from Dematic offered long-term savings. Able to operate around the clock and run overnight with the lights out, the addition of AGVs in the freezer warehouse meant a reduction in OH&S issues and elimination of human error. Plus, the increase in operational throughput provided by switching to automation allowed the company to remain in their existing warehouse rather than build a new facility, potentially providing savings in the millions.

Learn more at dematic.com.au/oxford-cs.

THE COOLEST SOLUTION.

Ask us.

02 9486 5555 info.anz@dematic.com

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MHD TECHNOLOGY

SMARTER CLEANING Robotic cleaning machines can help forward thinking companies leverage technology to improve efficiencies. Tennant ANZ is ready to lead the way locally with its T7AMR solution.

Many autonomous cleaning machines have built in safety features that protect against accidents.

R

obotics and automation are changing the way businesses operate – from the way goods are manufactured and distributed, to the way people work and the kinds of jobs they do. As technologies evolve, they typically become more affordable, more advanced, and more universal.

This is especially true of robots.

Today’s sophisticated robots are used in more ways than ever – and their growth is accelerating. Increasingly, companies of all kinds are recognising the impact robotics and innovation can have on making their businesses – and employees – more productive and efficient. Any industry that can redeploy labour in their operations can potentially gain a significant advantage by leverage the power of robotic machines. Robotics can also help companies become more competitive.

This is particularly important for smallto-medium sized businesses and BSCs. The added boost to productivity and efficiency helps these smaller companies compete on a larger scale, or where the labor market is tighter. Automation helps large companies compete – giving them an edge by giving their customers a better overall experience.

42 | MHD APRIL 2020

accidents and mistakes due to human error. Overnight cleaning crews, for example, can get tired and make mistakes in judgment or lose focus. This smarter cleaning can lead to accidents and damaged equipment, structures, or products. Some of these mistakes can be costly. Robotic cleaning machines, on the other hand, are programmed to be reliable and consistent. Many have built-in safety features that protect against accidents, whether they’re used independently of, or collaboratively with, human workers. Through the use of sensors, lasers, and cameras, robots limit the exposure to damage.

Many of today’s robotic cleaning machines offer the latest in sustainable cleaning solutions, technologies, and equipment — just like their non-robotic counterparts. Tennant’s machines, for example, minimise environmental impact in seven key categories including energy, CO2 emissions, ozone, smog, acid, eutrophication, and particulates. Not only is this great for the environment, but it’s cost effective, too. Today’s machines require less water and fewer chemicals—saving money on supplies while reducing downtime, thereby making cleaning crews more productive. This can help companies increase their bottom line and help BCSs in particular gain a competitive advantage in the market.

THE BENEFITS TO EMPLOYEES Robotic cleaning machines can improve consistency of clean.

ROBOTIC CLEANING MACHINES Robotic cleaning machines offer many practical advantages to both facility managers and BSCs – from increasing productivity, to improving consistency of clean, with less maintenance costs from minimal human operator error.

Robots can also play a role in making work environments safer by reducing

The cleaning industry is known for high turnover. The jobs aren’t very glamorous and workers sometimes do it on a temporary basis in between other jobs. What’s more, the current labour market is very tight and some face compliance challenges in Australia, such as ensuring correct award requirements are met. Unemployment is at the lowest levels in decades and employers are struggling to fill positions. To remedy these current challenges, robotics offers several benefits that could help retain and attract employees. First,

MHD TECHNOLOGY robotics can aid employee retention by improving job satisfaction, performance, and overall work quality.

The high-tech equipment training involved enhances workers’ skills, which can make them feel more valued and help them become more desirable employees (while expanding their career opportunities). Robotic cleaning machines can also help companies repurpose existing workers. With less of their time spent doing rote, repetitive tasks, employees have more time to focus on other cleaning tasks like cleaning windows, bathrooms, stocking, emptying trash, etc.— ones that require a human to perform. Freeing workers up also creates the potential for them to interact with customers, upsell products, or get trained to do tasks that have a more direct impact on a company’s earnings. For companies having trouble filling positions, robotic cleaning machines can help by enabling current employees to accomplish more in less time, allowing fewer workers to accomplish the work of a larger crew. And when it comes to attracting prospective employees, robotics brings

a leading-edge perception with it that’s attractive to those interested in working for a forward thinking company.

Embracing robotics creates the perception that a company is a better place to work, and one that values innovation. This can give a company a leg-up on the competition when it comes to attracting workers.

DATA-DRIVEN CLEANING Data tracking is increasingly important and widespread across business, technology, and life in general – from sales data, to financial data, to GPS data, to health data, and much more. The way to optimise your process for best results is to know where you are, measure it against where you want to be, and then use the data to make adjustments. For facility managers, the need to work more efficiently and effectively is always important as managers are continuously looking to improve processes, increase sustainable practices, and streamline operations. For BSCs and facility managers looking to maximise their performance with minimal investment, data tracking is an excellent solution.

Choosing robotic cleaning machines with data reporting technology gives fleet managers greater insight into cleaning performance, enabling them to optimize their cleaning performance and track key performance indicators with dashboard reporting and alerts.

This can help companies increase efficiency, reduce expenses, maximize operation time and fleet size, ensure health and safety, make fewer errors, and identify areas for improvement.

For BSCs, the proof of service report and other powerful asset management solutions can be compelling differentiators to provide extra value for their existing customers and win new business. For facility managers, it empowers them to optimize their resources and operate more efficiently, maximising budgets as well as performance results. While usage data provides an instant snapshot of fleet performance, the true potential of the technology lies in the many ways operators can leverage the data to develop new insights, identify opportunities, and improve their results. ■

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MHD SAFETY

THE FULL PICTURE In-vehicle cameras give full visibility of what happens on the road, offering drivers peace-of-mind as well as encouraging best practice. MHD sits down with Dale Kingston, Technical and Product Lead at Ctrack to find out more.

Cameras make it much easier to work out what actually happened, rather than having to carry out a labour intensive investigation.

claims are reduced by up to 20 per cent, and fuel consumption down by up to 15 per cent.

GLOBAL OUTLOOK Ctrack has a number of different camera product offerings, from very sophisticated ADAS/Fatigue and multicamera solutions to basic cameras, starting from around $200.

Ctrack has a global development team with the primary centre being in South Africa, these teams are consistently working on new products for the market.

Dale heads up the product development in Australia and New Zealand and says that being part of a larger global product development team

T

he use of cameras in commercial and private vehicles is growing, a recent report by Allianz Australia found that there has been a sharp increase over the past 12 months.

The research revealed that there has been a sudden spike in popularity of dash cams on Australian roads, showing that one fifth of all Aussie drivers are currently recording their car trips.

Dual-channel dash cam systems comprise of two cameras with a highresolution feed for front and rear recording. A Global Market Insights report found that the camera market in commercial vehicles is due to grow rapidly, largely due to the safety benefits they offer.

44 | MHD APRIL 2020

The utilisation of these devices in commercial vehicles has witnessed high demand in recent years and cameras are often used in training institutes to train new drivers. Technological developments, such as 360-degree cameras, are supporting a higher implementation in commercial vehicles, which Global Market Insights reveals will fuel market growth.

Dale Kingston from Ctrack says there is a number of benefits for introducing cameras into a commercial vehicle operation. “We often find that once a camera is installed, it pays for itself in no time at all,” he says.

Ctrack user research revealed that after cameras are installed, insurance

is a great advantage.

“Each of our regions has its own product development teams. We develop products based on the specific requirements for the local markets in which they will operate. Product managers catch up every second week which allows us all to keep up to date with the different developments taking place in each region. If there is something new and exciting in Europe, then I hear of it early on and can adapt any of the developments that may be relevant for the Australian or New Zealand market,” Dale says Ctrack has been operational since 1986. The company now has a presence in more than 50 countries and employs more than 1,000 employees worldwide.

Part of Inseego Corp, Ctrack’s telematics solutions range from vehicle and asset tracking, routing to cameras and intelligent reporting to deliver easily accessible, real-time information to enhance business and deliver a strong return on investment.

Ctrack’s tailer-made solutions are suitable for both small and large fleet sizes and assets and can be deployed across multiple industries and vehicles.

MHD SAFETY

Across its camera range, Ctrack has seven different products. “We can meet all the requirements in this space, whether it be a small operator with a couple of vehicles in its fleet or a national logistics provider we have different products to fit each specific need,” Dale says.

One product that Dale singles out as offering a comprehensive solution is the Ctrack Iris. This camera features an in-cab, front and rear-facing camera which offers greater visibility, encourages better driver behaviour, reduces risk and improves safety, he says.

“Our new video solution is combined with a tracking device that also improves vehicle optimisation through driver behaviour, effective utilisation and performance,” Dale says.

SAFETY, TRAINING AND MANAGING FATIGUE One of the safety benefits of cameras is the ability to monitor fatigue, Dale says. “If the driver loses focus, then the camera sees this and provides a verbal prompt for the driver to refocus or take a break,” he says.

This alert can also be configured to send an email to someone to report any issues on the road, such as harsh braking, driver fatigue, excessive speeding and any behaviour that goes against protocol.

“These tools are used to promote best practice among drivers, and in doing so provide significant cost savings due to improved fuel consumption, tyres, brakes and general maintenance,” Dale says.

An added benefit for the drivers, Dale says, is that they have peace of mind if there are any incidents or accidents. “If there is an accident, camera technology provides full visibility. If you need to make an insurance claim, there is no ambiguity around what

Ctrack’s new camera Iris offers a comprehensive solution.

“

Our new video solution is combined with a tracking device that also improves vehicle optimisation through driver behaviour, effective utilisation and performance.

”

happened. It protects the drivers,” he says.

Having this level of visibility also contributes to a reduction in insurance claims and payouts and omits the need to have a full investigation after an incident, Dale says.

ACCESSIBLE TECHNOLOGY While cameras have been around for a while, Dale says the technology is beginning to become much more accessible and affordable.

“Camera technology is getting better and better. We are now able to provide an excellent service for a very reasonable price,” he says.

Dale says that if you have footage from a camera giving complete visibility of what happened and who or what was at fault, there is significant savings to be made.

“You can install a camera for upwards of $200 and if you have just one accident or incident, it’s paid for itself in insurance investigation claims,” he says. ■

MHD APRIL 2020 | 45

MHD SUPPLY CHAIN

EQUAL REPRESENTATION ACROSS SUPPLY CHAIN Following International Women’s Day, a commitment to the promotion of women’s leadership in the supply chain industry has been voiced to action.

Unilever now has the same number of women in leadership positions as men.

C

urrently within the supply chain industry, 14 per cent of women working in the industry are in C-Suite level jobs.

However, Unilever has announced that it has the same number of women as men in leadership roles globally for the first time.

The global company said women had historically been under-represented in supply chain, particularly in the management gender gap.

The Anglo-Dutch FMCG giant, which owns brands including Ben & Jerry’s, Dove, Lynx and Magnum, said it is now run by 50 per cent women at management level, which is up from 38 per cent five years ago. It also has a non-executive board made up of 45 per cent of women.

Unilever said improvements had been driven by its dedicated diversity and inclusion team, as well as implementing gender-balanced interview requirements have been introduced, as well as a “gender appointment ratio”, which measures the track records of senior leaders in appointing women 46 | MHD APRIL 2020

Alan Jope, Unilever’s chief executive, said the company is proud to have reached our goal of equal representation of women and men among its 14,000 managers, but their work doesn’t stop here.

Aline Santos, Unilever’s global chief diversity and inclusion officer, said harmful stereotypes and gender-based norms are one of the biggest barriers to achieving gender equality globally across all industries.

The CMA CGM Group has launched “We Are Shipping”, a dedicated program to the development of women’s leadership through actions such collective coaching sessions, testimonial meetings and specific training workshops.

A spokesperson from the CMA CGM Group said the training campaign on recruitment techniques that meet the requirements of professional equality and diversity is currently being rolled out, including among the teams at the Group’s head office in Marseilles, who oversee all recruitment operations worldwide.

Tanya Saadé Zeenny, Executive Officer of the CMA CGM Group said the We Are Shipping program has already helped 101 female employees in seven graduating classes in France, Lebanon and Singapore.

CMA CGM Group has also launched 100 per cent coverage of paternity leave for sedentary and seafaring personnel, and will provide financial support through the payment of an “early childhood” allowance to the Social and Economic Committees.

On May 28 this year, Global Women Supply Chain Leaders Award 2020 will be hosted in Paris, France.

The event aims to recognise all women who have achieved extraordinary success in the supply chain industry, by furthering frontiers and tackling taboo topics across the world.

Looking at the future of supply chain and considering the hugely beneficial skills of women, the industry requires a new generation of skills, and that will create an equal and diverse leadership, Tanya says. ■

MHD PROPERTY

REDEFINING THE WAREHOUSE Ahead of the launch of The Industrial Property of the Future report, experts from Colliers present an overview of the trends that are set to shape industrial assets in Australia in the coming years.

I

n 1760, the world experienced a major turning point in history. The Industrial Revolution; the transition from hand production methods to new, machine manufacturing processes, has shaped almost every aspect of our daily lives and been attributed to raising the standard of living in the western world.

Today, we are on the cusp of the Industrial Revolution 4.0, where emerging technologies are redefining how warehouses operate, where goods are manufactured and delivered from and how the general population purchases, pays for and consumes products.

As an owner, investor, tenant or operator of industrial property it is vital to understand how technology

is creating a new kind of consumer and how this impacts every single aspect of industrial property and the supply chain.

Colliers experts have created an in-depth overview of the trends which will shape the future of industrial assets in Australia, empowering our clients to maximise the potential of their property.

CONSUMERS IN 2020: WHAT DEFINES THE NEW GENERATION OF CONSUMERS? They demand instant retail gratification Consumers are becoming increasingly discerning and expect immediacy and flexibility. They want the ability to purchase any product from any

retailer in any location they choose and determine how and when to pay for it. The demand for instant retail gratification is particularly prevalent amongst Millennials and is underpinned by the growing popularity of “buy now, pay later” payment services, such as AfterPay and ZipPay, which enables consumers to purchase a product immediately and then pay for it over a series of instalments. Mozo’s Buy Now Pay Later Report for 2019 stated that around 30% of Australian adults now have one or more of these accounts, roughly totally 5.8 million users nationally.

They are empowered Consumers now have a wealth of information at their fingertips, enabling

A measurement of efficiency, with sustainability in mind, is the use of clean energy.

48 | MHD APRIL 2020

MHD PROPERTY

There is an increase of consumer facing interaction for warehouses “click and collect” capabilities

them to make more informed purchases.

They research online for the best deal – even while they are shopping in-store. According to KPMG’s Global Online Consumer Report, 65% of consumers use a smart device to conduct a price comparison with other retailers while in a bricks and mortar shop.

The growing empowerment of consumers is also driving them to become more brand agnostic. Shoppers no longer need to be loyal to a particular brand or retailer - if their needs and expectations are not being met, they can and will, purchase their goods elsewhere.

They are omnipresent Digital and mobile technological developments have evolved the traditional, linear path to purchase into an intricate web of activity. Consumers can now purchase their goods through any channel of their choosing, from a brick and mortar store, online store or click-and-collect through a mobile device or social media. Retailers are capitalising on the shift towards purchases through social media platforms by leveraging shoppable tags on photos and in-app payments.

They are digital savvy The growing digital literacy of consumers is reflected in their online shopping behaviours. While many online purchases are made through desktops computers or

“

Consumers are becoming increasingly discerning and expect immediacy and flexibility.

They want the ability to purchase any product from any retailer in any location they choose and determine how and when to pay for it.

”

laptops, consumers are increasingly using mobile devices to make online purchases.

One in four online purchases made in Australia in 2019 was through a mobile device, according to the latest PayPal m-Commerce Index, which also states that 48% of people shop via mobile at least once a week.

They want a seamless experience Consumers increasingly expect ‘speed and ease’ throughout the lifecycle of a purchase from a retailer, providing them with a seamless experience. They want the ability to make online purchases and have their products delivered conveniently and quickly, as well as having this experience mirrored through the returns process.

Timely and convenient deliveries have become an important consideration for online consumers. They are increasingly demanding the ability to have online purchases delivered at a place and time that best suits them and access to realtime tracking information.

WHAT TECHNOLOGY AND INNOVATION IS OCCURRING IN WAREHOUSES AND THE BROADER SUPPLY CHAIN TO TAKE ADVANTAGE OF THESE CONSUMER TRENDS? There are five main factors here: warehouse design, geography, technology, data and MHD APRIL 2020 | 49

MHD PROPERTY

IT and adaptability of the modern warehouse. Let’s look at factors in warehouse design: Warehouses and distribution centres are growing in size The size of warehouse and distribution facilities has increased substantially over the past decade, with e-commerce operations requiring larger floor space to accommodate an increase in stock and enable greater efficiencies.

10 years ago, it was common for warehouses to be 10,000sqm or more in size with one dock for deliveries and dispatches.

Today, the average size of an industrial development is almost 20,000sqm. New warehousing and distribution facilities are being constructed with both sunken dock and on-grade roller doors to provide greater throughput efficiencies and enable multiple, simultaneous deliveries and dispatches. The efficiencies achieved from these larger facilities also have a direct correlation to “cost to store” savings on consumer goods.

Clean energy technology Another measurement of efficiency, with sustainability in mind, is the use of energy. The warehouse of the future will likely operate 24/7/365 therefore smart solutions to reduce electricity and other utilities’ consumption is

a key aspect to consider.

The use of alternative energies for the achievement of carbon neutral operations is becoming a ‘must’ in warehousing construction, therefore clean energy generators like solar panels and, still emerging wind turbines are to be increasingly considered in the modern buildings for lighting and heating. Electrical vehicle chargers and equipment that can store energy and divert unused energy will be the most commonly found fit outs.

Emergence of hub-and-spoke warehouses close to urban locations for on demand / diversified last-mile solutions The emergence of these industrial facilities is increasing as key stakeholders and participants develop new retail supply chain solutions and infrastructure to help merchants place inventories closer to consumers and provide on-demand delivery networks with instant delivery capabilities.

Whilst these smaller facilities may only be 1-3,000sqm in size and located in urban areas close to consumers; they will require key larger consolidation/fulfilment warehouse functionality considerations to include: •C onsumer facing interaction for warehouse “click and collect” capabilities • Inbound/outbound vehicle capabilities to include semi-

Consumers can make purchases on any channel of their choosing, from a brick and mortar store, online store or click-and-collect through a mobile device or social media.

50 | MHD APRIL 2020

trailers, light trucks, delivery vans, motorcycles; •2 4/7 operations and high staffing considerations; • Potential co-sharing/collaborative and on-demand operational requirements; • F lexibility in commercial terms with Developers and Property Owners; • I ntegration of emerging technology, mechanisation and automation.

The implementation of automation has evolved the design of warehouses and distribution centres, with higher internal clearances and upgraded floor loading capacities becoming increasingly prevalent. The driver of this trend is the key objective of maximising the utilisation of the expensive square space within the warehouse as an essential measurement of overall logistics cost efficiency.

Standard internal clearance heights are now being constructed up to 14.6m metres at the ridge and based on 11.3m portal centres, which can support efficient racking layouts and increased pallet storage solutions.

This enables greater operational savings to be achieved from increased storage density and minimised internal travel distances; whilst also simplifying the picking of an order.

Other building design enhancements being incorporated into warehouses and distribution centres include adopting building layout ratios of 2:1 (length to width), increased access doors and recessed docks, proximity of staff amenities to operational/ work areas, one-way traffic flows, and advancements in materials handling equipment.

The reduction in labour costs and decrease in power consumption, as a result of design enhancements and automation in warehousing and distribution facilities, has enabled further cost savings for organisations in delivering goods to consumers. ■

In April, Colliers will launch their latest report: The Industrial Property of the Future. To register to receive the report into your inbox, head to www.warehouseofthefuture.colliers. com.au

More Industrial Experts More Industrial Services More Opportunity We create enduring value for every property solution through our investment in relationships with our clients and our people. Collaborating across services, markets and experts we drive exceptional results wherever our clients do business.

Demand more from your industrial experts and maximise the potential of property. colliers.com.au/services/industrial

MHD STORAGE SOLUTIONS

To ensure ongoing safety and compliance, storage systems need to be maintained and serviced regularly.

INVESTING IN SAFER STRUCTURES R

Lawrence Mok and Anthony Barbara at Dexion Australia highlight the growing challenges the pallet racking industry is facing to ensure safety remains the primary focus.

ecent events such as the cracking occurring in residential towers in Sydney, and scaffolding collapses, plus the exposure of dangerous and fatal accidents shared on Social media platforms remind us that we must always keep safety front of mind.

These catastrophic events should shine a spotlight on what your business is currently doing and how it can do it better.

PALLET RACKING IN AUSTRALIA Storage, retrieval, and product handling under industrial racking systems is an integral cost and efficiency factor across distribution facilities. However, red flags are being raised over pallet racking operation and maintenance.

According to a study by Persistence Market Research, the global industrial racking system market is expected to grow at a CAGR of 7 per cent over the next 10 years. This is due to warehouse expansions, the surge in e-commerce products and other automation factors.

Dexion manufactured storage solutions have been providing safe 52 | MHD APRIL 2020

products for over 80 years and are one of the prominent market players in the business of pallet racking, shelving and storage. Lawrence Mok, Manager of Structural Engineering and Anthony Barbara, Senior Product Manager at Dexion say that an efficient warehouse is a critical part of success for businesses. Whether the design is simple racking, semi-automated or fully automated, the layout and structural design are critical to ensure a solution meets the safety standards, as well as being an efficient and flexible.

Lawrence and Anthony say a warehouse solution is like any piece of machinery. To ensure ongoing safety and compliance the storage solution needs to be maintained serviced regularly and repaired when damaged. Lawrence and Anthony warn that without proper engineering, pallet racking can become seriously dangerous.

They’re urging companies to invest in safe structures in order to prevent potential racking failures that would be hazardous for workers and have a detrimental effect on the business.

IDENTIFYING THE DANGERS Lawrence and Anthony have a combined experience of 45 years in designing, developing and evolving products & racking solutions. As a qualified engineer who has worked across the Australasian market, Lawrence is regarded as the racking guru at Dexion Australia. They’ve seen new products and market trends sculpt the changing industry but are firm to say that safety has always been the top priority.

Dexion’s technical experts are concerned at the current neglect from companies who are failing to maintain an engineered pallet racking structure.

They believe there is a lack of awareness surrounding pallet racking issues and businesses are compromising safety for cost effective solutions, that could be a dangerous decision.

Some customers are skyrocketing their risk towards a fatal accident due to a range of factors. The main dangers include mixing different brands to deliver pallet racking solutions for its warehouses and using racking companies that do not provide engineering certification of their

MHD STORAGE SOLUTIONS product. Undertaking poor installation of the racking structure and failing to maintain rack structures in accordance with the code are also high-risk variables that contribute to avoidable accidents.

“This is common in small traders, they may think that if the beam slots in the upright position then the product is compatible, but this is a huge misconception,” Lawrence says.

Every solution has its own unique engineering requirement, the design may also include seismic considerations due to different locations and operational requirements. Lawrence says some manufacturers try to copy components from other pallet racking solutions that are inaccurate. Even worse when an inferior steel grade is used.

Beams accidentally dislodging and uprights collapsing under the weight of the load, are among the unknown risks when a structure isn’t fully customised and engineered. It is the workplace’s responsibility to maintain safety. The racking supplier should be providing the correct engineering certification to ensure the design is safe and made to the code.

Anthony says it is non-negotiable that racking structures that are used daily, need to be regularly maintained and serviced, just like you would with your car to prevent serious implications. A damaged upright or beam left in operation can cause a load to fall or rack to collapse. It is important that organisations have the processes in place to ensure a damaged area is blocked from use and assessed by an experienced rack inspector as soon as it is noticed.

Structural design and testing supports all market sectors.

AN ENGINEERED SOLUTION With over 80 years’ experience in delivering safe storage solutions, Dexion has delivered a diverse range of projects to thousands of customers. The company’s history and experience in the industry has shaped how they manage complex project requirements. A critical part of this is the safety culture that underpins all decisions. Dexion thrives on customer engagement. The company knows they need to understand every customer’s requirements to provide a solution that complies to relevant codes and standards, but also ensuring that the business is supported with training and governance post job installation.

as extreme weather events, so we test every detail and ensure its engineered correctly,” he says.

MAINTAINING SAFETY A racking collapse can cost businesses significantly in product and property damage, as well as causing serious injuries to warehouse workers. Dexion provides solutions for small and large warehousing operations, no matter the size of the organisation, the safety needs are the same.

Anthony says across Dexion’s 20 plus supply centres in Australia, everyone working throughout its warehouses have acknowledged the company’s commitment to safety. “I’ve never

Dexion has trained certified rack inspectors who ensure ongoing safety of the structure.

Lawrence says other racking companies only focus on theoretical design for engineering certification, but Dexion believes in combining theory and actual part testing, as customers get a proven solution that is reliable, efficient and safety guaranteed.

“We confirm all our calculations by physical tests. Theory is based on ideal conditions, and we know that there are other factors that can occur such

worked in an industry where people have worked for a brand and shown a total commitment to safety, you really can’t get better reassurance,” he says.

Dexion has trained certified rack inspectors that can ensure ongoing safety of your structure.

It is not uncommon for a fork truck or a pallet to collide with the racking structure. The inspector will highlight any areas that need repairing as well as ensure that any damaged racking is replaced by the correct components.

Dexion is one of a few companies that offers a lifetime warranty on their products. To maintain the warranty Dexion requires the customer to ensure their rack is inspected regularly and maintained.

Lawrence says Dexion’s structural design and testing supports all market sectors. From pallet racking that supports cardboard boxes to racks that are designed with fire sprinkler systems that are approved by local fire departments, it’s Dexion’s mission to deliver and maintain safe pallet racking for all industries. ■ MHD APRIL 2020 | 53

MHD Supply Chain

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MHD SUPPLY CHAIN

RETHINKING GLOBALISATION Henry Brunekreef, Director in the Australian Operations Advisory Group and National Leader Supply Chain at KPMG Australia sits down with MHD to discuss how recent events are causing organisations to rethink their shift to globalisation.

H

enry is a Director in the Australian Operations Advisory Group and National Leader Supply Chain for KPMG Australia.

Here he discusses how epidemics like the recent spread of coronavirus are causing organisations to rethink their shift to globalisation.

Henry brings more than 20 years’ experience in supply chain strategy, design and implementation, transformational change management, business planning and operations management.

He has worked with clients in Europe, South Africa, North America and Australia. Holding senior positions at Cisco and Rockwell Automation as well as consulted for many global organisations across retail, consumer goods, industrial, life sciences,

health, telco and mining.

One area that Henry is particular interested in is the effect of the recent trend towards globalisation. “When

globalisation became mainstream, it was all about cost, but nobody really understood the potential impact this would have on the

Henry Brunekreff - Director in the Australian Operations Advisory Group and National Leader Supply Chain for KPMG Australia.

MHD APRIL 2020 | 57

MHD SUPPLY CHAIN supply chain,” he says.

This kind of impact can be seen with the current coronavirus crisis causing significant problems for huge global organisations such as Apple, Tesla and DHL. It has been reported that 94 per cent of the top 1000 Fortune companies are experiencing coronavirus supply chain disruptions.

The air and sea global freight industry are confirming that a “return to the norm” is months away, with some suggesting that it will be September or longer before a full return to productivity and sufficiency across the supply chain.

Some organisations are already reporting a loss in profits, with the world’s biggest container ship operator, Maersk, saying the impact from the coronavirus will send its company into an unexpected fourth-quarter loss.

“Moving your supply chain to some of these cheaper locations may present costsavings initially, but if you look at total cost of ownership you could be looking at huge losses,” Henry says.

For Henry, it’s important to understand

Considering implications when planning a global supply chain is critical to reducing complexity and uncertainty.

58 | MHD APRIL 2020

“

Moving your supply chain to some of these cheaper locations may present cost-savings initially, but if you look at total cost of ownership you could be looking at huge losses.

”

the implications and consider these when planning a global supply chain. “It might be a hybrid model, whereby you keep some of the more critical parts in your supply chain much closer to where the goods will be sold or used,” he says.

Henry relays some early advice he was given while studying supply chain and says that supply chain management is ultimately about two things. First, it’s about reducing complexity, and secondly it’s about reducing uncertainty,” he says.

With these two principles in mind, Henry says we should question why we add complexity all the time. “if you are sourcing product from Vietnam for a Melbourne point of sale, you are adding complexity,” he says.

For Henry, much of the work he does is about reducing complexities across the supply chain. He sees developments in data and artificial intelligence as a way to help reduce complexities.

“If we can use these tools to predict that certain issues may arise, then it’s much easier to mitigate that risk when it happens,” he says. ■

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MHD TECHNOLOGY

CYBER SMART With cyberattacks, information infrastructure breakdown and data fraud or theft highlighted as some of the most impactful risks of 2020, board directors are forced to assess cyber security policy like never before. Jonathan Sharrock, CEO at Cyber Citadel and Partner, Freight and Trade Alliance explains.

T

he World Economic Forum’s Global Risk Report highlights a variety of risk areas, including economic, environmental, geopolitical, societal and technological. While the most likely risks lie in the environmental sector, and the most common risks are cited in the economic sector, the possibility of any disaster being followed by a cyberattack should encourage all organisations to reassess their cyber security policies, Jonathan Sharrock, CEO at Cyber Citadel and partner, Freight and Trade Alliance says.

Companies including Apple, Microsoft and Samsung announced that they would be shutting down all corporate offices, manufacturing

factories and retail stores across China due to the Coronavirus outbreak at the beginning of February.

With such depleted manpower and productivity, a well-placed cyberattack could cause a global techgiant meltdown.

And the likelihood that this might happen, not only to multinational corporations but also to mediumsmall businesses, is very likely indeed, given the figures from 2019, Jonathan says. According to Cybint, almost 60 per cent of companies globally experienced a cyberattack last year. “It is now common knowledge that any person interested in getting into the hacking game can do so with a hacking kit available on the Dark Net for as

little as $1. Worse still, third-party hacking services can even be found on the Internet,” Jonathan says.

Of particular importance is the risk of cyberattacks on the logistics industry, a business sector that hackers are preying on more as an easy target., according to Jonathan.

With a 50 per cent increase in attacks on the logistics industry between 2018 and 2019, it is no wonder that Eyefortransport declared the logistics industry is still not seeing security as a primary part of business operations. Their findings included a surprising level of neglect to cyber security across the industry as a whole: only 35 per cent of service providers had a Chief Information

According to Jonathan, hackers see the logistics sector as an easy target.

MHD APRIL 2020 | 61

MHD TECHNOLOGY

“

Many logistics companies continue to use legacy hardware and software technologies.

Security Officer (CISO); only 43 per cent of shipping companies had a CISO; only 21 per cent of logistics companies believed they needed a CISO; at least 55 per cent of logistics industry employees felt ill-equipped to identify and deal with a cyberattack.

As organisations crucial to global interconnectedness, logistics companies are generally older than their tech cousins.

As a result, many continue to use legacy hardware and software technologies: clunky, plastic desktops; Windows 97. While efforts have been made to modernize, slowly and cost-effectively, they run short of staying ahead of techsavvy hacking groups using more powerful servers with a better understanding of computer systems in general.

Also, trying to harden cyber security in pre-existing network systems is less reliable than starting from the bottom and building a secure network from scratch.

Compounding this problem of old technology is the basic nature of logistics companies. To be successful, they must be wide, operating in different localities, possibly even in different time-zones simultaneously; complex in operation and scope, Jonathan says.

The distribution of a single container will likely involve information and goods transfer with at least ten different stakeholders, including the shipper, the consignee, a shipping line, origin and destination ports, a trucking company, and banks, as well as customs and border authorities if the item is shipped outside the country. It is this interaction between large and small companies in the logistics cycle that contributes to the cyberattack process, and leaves companies only as secure as their weakest link.

62 | MHD APRIL 2020

“With their far-reaching tentacles, logistics companies arguably suffer the most as potential victims of cyberattacks due to their inability to accurately determine how many device vulnerabilities they have. Whether a logistics company is global, national or regional, the number of company computers, tablets, smartphones, even drones or automated cars under the same network, can quickly become unaccounted for. Considering each device is a potential entry point for a cyberattack, unaccounted for devices are easy backdoors for hackers to exploit. Like a garden shed at the bottom of the garden, a logistics company seen from afar can appear orderly and neat. Only, when you step inside and turn on the light, the shed becomes a haven for disorder and disarray,” Jonathan says.

Global in reach yet fragmented by varying levels of technological equipment, and sometimes unable to account for devices connected to a network, the potential risk to the logistics industry lies not only

Whether a logistics company is global, national or regional, the number of company computers, tablets, smartphones, even drones or automated cars under the same network, can quickly become unaccounted for.

”

Jonathan says cyber security is crucial for survival in the logistics industry.

MHD TECHNOLOGY in a data breach or system hijacking, but also in physical harm. For transportation and logistics firms who deal with assets in motion, there’s always a risk of bodily injury and property damage. A network intrusion could lead to numerous problems, including traffic accidents, loads exceeding weight limits, and hazardous materials being transported to an incorrect destination, Jonathan explains.

Ultimately, cyber security in the logistics industry is key to survival, namely because cyberattacks can incur huge financial costs as well as debilitating reputational losses.

In 2017, Centrify conducted an assessment of 113 publicly listed companies, all of which suffered data breaches. They found that the companies’ stock values declined 5% on average after disclosing a data breach, taking between 7 to 90 days to recover their stock prices; 27% of customers who suffered under a data breach left the company concerned.

More recently, the Australian transportation and logistics company Toll Group suffered a ransomware attack in February 2020 infecting its “sprawling technology systems.” Although the overall cost has yet to be determined, Toll refused to pay the ransom. However, reporting

for the Australian Financial Review, Technology Editor Paul Smith wrote, “The huge expected costs to Toll and the impact of the attacks on the broader supply chain, have led experts to warn that other Australian companies are sleepwalking towards the same calamity.” Given the astronomical costs to A. P. Moller-Maersk and FedEx TNT Express in 2017, the total financial cost to Toll could exceed $100 million.

Thankfully for Toll, their response to the attack has been quick and honest, Jonathan says. “The reputational loss Uber suffered after paying off a ransomware attack in 2016, without informing its customers of the attack for over a year, seriously contributed to the CEO’s resignation and the corporation’s flatline in growth.”

Although seemingly difficult, effective cyber security starts with company policy, which is dictated by the leadership and decisions of company board directors.

Whether implementing a full cyber security audit, employing outside professionals to test a system, installing new hardware and software throughout a network, or simply basic employee training, realising the importance of cyber security is a top-down process, Jonathan says. ■

MHD WOMEN IN INDUSTRY PROFILE

HIGHLIGHTING SUCCESS

Vikki Venables, Distribution Manager at Linfox tells MHD there is infinite opportunities for those who pursue a career in logistics.

H

ow long have you been in your current role?

I’ve been with Linfox for almost four years. I’ve been in my current role of Distribution Centre Manager, Big W for just under six months.

What does a standard day for you look like?

That’s what I love about my job, there 64 | MHD APRIL 2020

is no standard day. Some days I spend in the operational areas, talking about safety with team members, coaching managers and generally being involved in the day-to-day operations.

Other days, I spend in meetings with my managers and the customer discussing continuous improvement, safety initiatives, budgets and forecasts.

What has been the highlight of your career so far?

In December 2018, I received a Linfox Presidents’ Award. In that same week, I completed my Graduate Certificate in Management.

It had been a tough six months managing study and stepping up into an acting Distribution Centre Manager role, which was a steep

MHD WOMEN IN INDUSTRY PROFILE

Exciting opportunities lie in the logistics industry.

Vikki Venables, Distribution Manager at Linfox.

learning curve. It was very humbling to receive both certificates in the same week.

I’ve been fortunate to work with great teams and it’s always a highlight for me when I see one of these team members recruited and promoted.

What do you like about working in the logistics industry?

A. The varied work, the fast pace, the feel of it being a little community – everyone knows everyone and we’re always willing to help each other out.

What do you like about working at Linfox?

The opportunities are infinite. While it’s an international company, it still has family business values and appeal.

The Linfox values of loyalty, integrity,

fairness and trust really align with my personal values. You’re always treated as if you matter, whatever your role.

What do initiatives like the Women in Industry Awards and Conference mean to you?

It highlights the success of women in the industry and demonstrates that we’re working at the highest levels and having a positive impact on peoples’ lives.

How does Linfox demonstrate diversity?

Linfox recognises that the industry has a long way to go to achieve gender equality and has developed dedicated programs to meet this challenge.

Linfox became a Gold Corporate Member of the National Association

of Women in Operations (NAWO) in 2016 and our President Consumer and Healthcare Group, Kylie Fraser is a NAWO Board Member.

Linfox also runs a Female Driver Program, which aims to remove the barriers to women entering the heavy vehicle industry.

What are you most looking forward to in your upcoming professional life?

The challenges of the next 12 months will be interesting. We’re working with our customer, Big W on an exciting new automated distribution centre in Hoppers Crossing Victoria.

I also plan to continue the Executive Coaching Consultancy that I started last year after completing my Certificate and Diploma in Business and Workplace Coaching. I get so much satisfaction from coaching managers to become leaders and specialise in highperforming teams, organisational culture, personal values, and creating a growth mindset. ■ MHD APRIL 2020 | 65

MHD FROM ALC

REFOCUSING ON RESILIENCE AFTER A CHALLENGING SUMMER

I

t’s reasonable to say that many Australians have experienced a challenging beginning to 2020, and the flow on effects are likely to affect our industry in a variety of ways over the months ahead.

The bushfires that burned through vast swathes of the continent had a devastating impact on families, local communities and businesses. The immediate scale of the tragedy is recorded in lives and homes lost and understandably, that is where the initial focus of recovery efforts has been.

Yet in some respects, that is only the beginning of the story. With the fires now extinguished and the immediate physical threat having passed, it is becoming apparent that recovery efforts – and the cost of those efforts – will be significant.

These costs will include significant repairs that will have to be undertaken to repair damaged transport infrastructure in regional communities, particularly road and 66 | MHD APRIL 2020

bridge infrastructure that facilitates the efficient and safe movement of road freight.

Throughout the early weeks of this year, ALC participated in regular industry discussions convened by the Deputy Prime Minister and Minister for Transport, Infrastructure and Regional Development, Hon. Michael McCormack MP, which were focused on providing industry advice and assistance to the Federal Government in shaping its recovery response to the fire crisis.

As the fires burned, it was inspiring to see Australia’s freight logistics industry once again showing its determination, professionalism and generosity as our professionals worked around the clock to get supplies to affected communities and provide practical assistance on the ground to those most in need.

This included truck convoys that took food, water and other essential supplies to affected communities, transported livestock feed, conveyed shipping containers to assist with

storage of donated goods in fire-ravaged regional communities and provide direct logistical support to teams of firefighters as they battled the blazes.

What was already a difficult beginning to 2020 has subsequently been further compounded by the challenges associated with the coronavirus.

As in the case of the fires, the initial focus was on protecting lives through containment and quarantine efforts. Yet, as with the fires, once the immediate situation is addressed, there are still significant economic consequences to consider.

Logistics companies are at the forefront of getting goods into and out of Australia, whether by air or through our ports. The road and rail freight and warehousing sectors play a critically important role in getting those goods to customers, or to the point of export. The disruptive effects of an episode like the coronavirus have obvious flow-on effects across the whole supply chain – and these will need to be

MHD FROM ALC

As the fires burned, it was inspiring to see Australia’s logistics indusry show its determination and resilience.

managed effectively and responsibly.

At the outset of the crisis, experts warned that the ongoing restrictions on the movement of goods and people in China – our largest trading partner – are likely to adversely impact Australia’s agricultural exports, and there is now evidence to suggest this is occurring.

The effects are also being felt in other export sectors, including minerals and resources.

On the other side of the coin, restrictions on the departure of vessels from China means those importing goods to Australia – and the road and rail transport businesses which supply them – are also experiencing a slowdown.

Although some comparisons have been made with what occurred during the SARS outbreak in 2003, the supply chain impacts of coronavirus will run deeper.

For one thing, the Chinese economy was $1.3 trillion at the time of SARS; today, it is around $14 trillion – and China is far more embedded in global supply chains than it was 17 years ago.

There will be few Australian businesses whose supply chain operations do not have at least some degree of exposure to China, which means delays to obtaining goods brought about initially by delays to shipments, and then by bottlenecks as operations

start to come back online.

Whilst China will clearly remain an important market for Australian goods, the coronavirus event is a powerful reminder of why diversification of markets is important. As we start to lean the lessons of a difficult summer, one question this industry must ask itself is whether our supply chains are sufficiently nimble in responding to these events. And, if the answer is ‘no’, what corrective investments should we be making?

Improving the resilience of Australia’s supply chains to withstand the effects of natural disasters and international events was clearly identified in the National Fright and Supply Chain Strategy released last year.

It was also a theme echoed in the 2020 Infrastructure Priority List released by Infrastructure Australia in February.

The updated list placed a renewed emphasis on enhancing the capacity of national infrastructure to cope with disruptive events – whether they by as a result of natural disasters or through other unexpected events such as global epidemics or terrorism.

The first weeks of 2020 have provided stark examples of why our governments must join with industry in acting more urgently to address that challenge. n

What was already a difficult start to 2020, has been further compounded by the challenges associated with coronavirus.

MHD APRIL 2020 | 67

MHD FROM ASCI SPONSORED BY

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nderpinning the Australasian Supply Chain Institute (ASCI) Professional Accreditation Scheme is a Continuous Professional Development program that allows ASCI to build career pathways in supply chain management to enrich and grow professional supply chain performance and competence.

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MHD FROM ASCI

APICS CERTIFIED IN PRODUCTION AND INVENTORY MANAGEMENT (CPIM)

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Thousands of employers worldwide look for the CPIM designation when making critical hiring decisions. These companies know that CPIM designees have the proven knowledge and skills to strategically streamline operations. Are you ready to distinguish yourself in supply chain management?

APICS CPIM Part 1 - The Basics of Supply Chain Management is our flagship course for those new to APICS study.

Online Certification Review Class When: Tuesdays, 7-10PM (AEST) commencing 21 April Format: 7x 3 hour weekly online sessions with a local APICS Facilitator APICS CPIM Part 2 Learning System is now reconfigured from four modules into one with one exam. This is a really great improvement to the certification. Topics include: 1. Strategic Management of Resources 2. Master Planning of Resources 3. Detailed Scheduling and Planning 4. Execution and Control of Operations

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since release and brings with it a number of fantastic changes including entire modules focused on Sustainability and Reverse Logistics.

ISM CERTIFIED PROFESSIONAL IN SUPPLY MANAGEMENT (CPSM) The CPSM is globally recognised as the gold standard of excellence for supply management professionals, in both the manufacturing and non-manufacturing sectors. Built on an in-depth analysis of supply management functions across industries, the program addresses the realities of supply management, as well as workplace complexities including globalization, use of technology, and expanded competencies that procurement and supply chain professionals employ to drive value in their organisations.

Corporate training is also available by contacting the ASCI National Office on 0439 320 152. ■

APICS CSCP Learning System

2 Capacity Planning and Demand Management 3 Order Management 4 Inventory and Warehouse Management 5 Transportation 6 Global Logistics Considerations 7 Logistics Network Design 8 Reverse Logistics and Sustainability CLTD now has its first major update MHD APRIL 2020 | 69

MHD THE LAST WORD

EXPORTERS AND IMPORTERS WELCOME AUSTRALIAN SHIPPING COMPETITION REFORM

BY PAUL ZALAI – DIRECTOR AND CO-FOUNDER, FTA / SECRETARIAT, APSA

S

hips are getting bigger, the shipping line market is contracting and alliances are dominating.

The question for Australia’s shippers (exporters and importers) is whether this translates to better services, more competitive pricing and regular access to markets.

The question for our regulators is how much deviation from standard competition law should shipping lines be allowed to facilitate the dominance of alliances?

The experience in the European Union has been detrimental to shippers with trade bodies recently aggressively arguing against another four year extension of the liberal Consortia Block Exemption Regulation largely exempting lines of regular competition laws.

In contrast, our New Zealand neighbours seem to have got it right.

While accepting the need for shipping line consortia arrangements, the New Zealand competition authorities have introduced new statutory provisions adding rigour to their block exemption regime requiring evidence of benefits to shippers.

So how is Australia dealing with this?

Part X of the Consumer & Competition Act 2010 has evolved since first introduced in the Trade Practices Act 1974 providing broad exemptions from competition law for registered shipping lines to coordinate with each other in transporting cargo to, or from, Australia.

70 | MHD APRIL 2020

Shipping line market consolidation plus the emergence of stevedoreimposed Infrastructure Surcharges has resulted in supply chain costs rapidly increasing, exposing significant deficiencies in the effectiveness of Part X in being able to achieve basic shipper protections.

The Australian Competition and Consumer Commission (ACCC) has recognised a need for reform with the 3 December 2020 release of a discussion paper titled Proposed Class Exemption for Ocean Liner Shipping.

Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) have prepared a formal joint submission recommending: • repeal of Part X, • a replacement block exemption regime with terms to be drawn as narrowly as possible to permit the desired activities to

be operationalised, • r etain positive features of Part X into a block exemption regime including prescribed minimum levels of service, • e xclusion in a block exemption to fix price or surcharges, • m andate incorporation of stevedore fees within shipping line contracts (negating stevedoreimposed Infrastructure Surcharges administered on the transport sector), • i ntroduce a registration process administered by the ACCC, • c ontinuation of APSA as a designated peak industry body to support registration approval, • a lignment with the New Zealand block exemption regime to form a regional approach, and • p ractical legal instruments to allow shippers to negotiate collective freight contracts with shipping lines.

Importantly the submission endorsed the ACCC as being the appropriate entity to oversee shipping competition reform recognising its track record of strong compliance enforcement, noting last year’s criminal cartel prosecution against a major shipping line for price fixing in relation to an unregistered agreement, resulting in an order by the Federal Court to pay a fine of $34.5 million.

We commend the ACCC for commencing this necessary reform and we look forward to ongoing engagement to support our shippers compete in international markets, supported by appropriate, modernised regulation.

The FTA / APSA submission is available at www.FTAlliance.com.au ■

save the date

15-17 SEPTEMBER

2020

15-17 September 2020

William Inglis Hotel, Sydney

William Inglis Hotel, Sydney Contact: Tony Francis | 0422 088 350 | tony.francis@primecreative.com.au

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