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www.surecommedia.com Postal Registration No.: DL (S)-17/3372/2019-2021 WPP No.: U(S)-81/2019-2021 Posted at Lodi Road HPO, ND on the 4th-5th same month RNI No.: DELENG/2009/31040 Published on the 2nd of the same month

12 The

contemporary state of Breakbulk Logistics

40 Creating

potential-skills ambience in India’s logistics sector

48 Indian

Maritime Sector embracing the Digital Revolution

driving Performance and Profitability in Automotive Logistics

VOLVOL X ISSUE X ISSUE X september IX august 2019 `20

With global expertise and local know how Setting the New Benchmark



91 11 25601310



91 11 25601320





Volume X • Issue X • september 2019

Publisher Smiti Suri Principal Correspondent Ritika Arora Bhola Special Correspondent Upamanyu Borah Correspondent Saurabh Sharma



Driving performance and profitability in Automotive Logistics


The contemporary state of Breakbulk Logistics technology


Reporter Pallavi Jain Director Ajeet Kumar Marketing Manager Rahul Arora Marketing Executive Akash Gupta Rahul Jain Accounts & Administration Lavish Thakur

Perfecting production in SMEs using Industry 4.0............................................58


Creating potential-skills ambience in India’s logistics sector ..........................40 Feature

Indian Maritime Sector embracing the Digital Revolution...................................48 infrastructure

Anil Saini, Country Sales Manger- OEM,

Höegh Autoliners ............................................60

anacin kum, CEO, Hutchison Ports Sohar ......62

FRONTLINE ..............................................6 Buzz .......................................................8 HUB .......................................................10 NEWS ...............................................70-79 EVENTS ............................................80-81 UPCOMING EVENTS ................................82 APPOINTMENTS .....................................84 SHIPPER SPEAKS Atul Holkar, Head- Supply Chain Mangement, Varun Beverages- PepsiCo ........................................64 Sudhir Mohan Bansal, Vice President and India Head- Supply Chain Management, Pfizer Pharma .......66

India’s infrastructure push needs momentum..............................................56


Designer & Visualiser Ashok Saxena


Managing Director, Indian subcontinent, UPS .............86

All materials printed in this publication is the sole property of CargoConnect All printed matter contained in the magazine is based on the information of those featured in it. The views, ideas, comments and opinions expressed are solely of those featured and the Editor and Publisher do not necessarily subscribe to the same.

CargoConnect is printed, published and owned by Smiti Suri, and is printed at Compudata Services, 42, Dsidc Shed, Scheme–1, Okhla Industrial Area Complex, Phase–II, New Delhi-110020, and published at 6/31-B, Jangpura–B, New Delhi-110014

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frontline A meeting was held with stakeholders to discuss the matter and find ways to synchronise Indian transport and logistics industry with international norms...They assured us that their existing vehicles are designed to carry additional capacity easily and said that their trucks are designed to carry 150 per cent more than the stated limit of capacity. Thus, even if we increase the limit by 20 per cent, they are fit to comply. If we will allow

additional capacity to be carried, about 2 per cent transportation cost can be reduced. Road Transport & Highways minister Nitin Gadkari informed

The government envisages investment of `50 lakh crore by the year 2030 in Railways to make it the world’s best railway which will include safety of passengers, expansion of network, and increase in freight share.

Electrification work worth `11,000 crore undertaken by the Ministry of Railways has been sanctioned. Operating the entire route on electricity will aid to the environment and also increase speed. Besides, trains will run on clean fuel. Railway Minister Piyush Goyal expressed

The Government of India has lined up about 577 projects with an investment of over $130 billion over the next few years, with the idea of regaining the status of being a maritime power. Under the

port modernisation and building new ports initiative, the government has 210 has taken up projects with an investment of $ 27 billion.

Further, for bringing industry closer to the coastal region, the government plans about 14 SEZs with an investment of $70 billion. Director General of Shipping Amitabh Kumar noted


CargoConnect - september 2019

To bring India in the league of advanced nations like Germany, France, Japan and Singapore in skill development, the government will augment rural skill infrastructure besides setting up three advanced training centers in the country. To make India

one of the most advanced nations in skilling, we have adopted a multipronged strategy that includes creating an ecosystem to promote talent right from the grassroots.

Skill Development and Entrepreneurship Minister Dr Mahendra Nath Pandey stated

India’s GDP continues to grow at a faster pace than the global economy and any other major economy.

‘Angel Tax’ provision will be withdrawn for startups and their investors. MSMEs will get all their pending GST refunds within 30 days. Besides, all GST refunds of micro, small and medium enterprises (MSMEs) will be paid within 60 days from the date of application.

The government’s focus will be on setting up of infrastructure for development of auto ancillaries/components, including batteries for exports.


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Leasing of warehousing spaces jumps 31% in first half of 2019


easing of warehousing spaces went up by 31 per cent to over 13 million sq ft across eight major cities in the first half of this year, while investment of more than $200 million was witnessed in the industrial and logistic real estate segment, according to India’s leading real estate consulting firm CBRE. The demand for warehousing/logistics space was driven by third party logistic firms, which absorbed 56 per cent of the total space, CBRE said in its report 'India Industrial and Logistics Market View H1 2019'. Logistics leasing in the country recorded a growth of 31 per cent on a yearly basis, crossing 13 million sq ft, CBRE said in the report. The cities tracked in the report are -- Delhi-NCR, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad, Pune and Ahmedabad. Mumbai, Chennai and Bengaluru accounted for more than 60 per cent of leasing activity. "We expect logistics leasing activity to strengthen owing to consolidation/expansion by occupiers," said Anshuman Magazine, Chairman and CEO - India, South East Asia, Middle East and Africa at CBRE. According to the report, third-party logistics (3PL) players contributed close to 56 per cent of total absorption during H1 2019. On supply side, about 11 million sq ft space


Mumbai, Chennai and Bangalore accounted for leasing


of the total absorption was contributed by 3PL sector during H1 2019 as compared to 31% in H2 2018

11 mn sq ft

supply added in H1 2019; led by Mumbai, Chennai and Ahmedabad

US$ 200 mn investment was recorded in the industrial and logistics sector

was added in H1 2019, led by Mumbai, Chennai and Ahmedabad. "Domestic corporates drove demand with a share of about 85 per cent of leasing as compared to about 67 per cent in H1 2018," said Jasmine Singh, Executive Director, Advisory and Transaction Services, CBRE India. Sustained occupier interest in locating in quality developments resulted in rental growth of about 5-40 per cent in NH-1 and NH-8 in NCR; about 3-24 per cent in Eastern and Western Corridors in Bangalore; about 12-18 per cent in Western and Southern Corridors in Hyderabad; about 5-7 per cent in Western Corridor II and Northern Corridor in Chennai and about 3-6 per cent in Narol in Ahmedabad on a half-yearly basis. On outlook, the property consultant said that the "logistics sector is experiencing unprecedented structural shifts in the form of automation, leading to blurring of lines with the retail sector, transformation of supply chains and growing investments." As technology permeates the sector, demand for quality space is increasing and corporates across segments are opting for large, modern warehouses, it added. CBRE expects that the trend of E-commerce platforms owning and operating their own facilities will result in more builtto-suit facilities, thereby taking off some pure leasing from the market. CC

CBRE expects that the trend of E-commerce platforms owning and operating their own facilities will result in more built-to-suit facilities, thereby taking off some pure leasing from the market. 8

CargoConnect - september 2019



E-commerce explosion

driving worldwide warehouse expansion


he global Warehouse Management System (WMS) market will be worth US$5 billion by 2025, growing at a CAGR of 13.9 per cent, finds multinational analysis firm ABI Research. The period will see a warehouse boom with some 57,000 more distribution centres in operation by then than last year. The continued growth of the E-commerce market and rising customer expectations are putting enormous pressure on warehouses to execute more rapid and flexible deliveries. This is driving investment in warehouse facilities, automation technologies, and warehouse management systems to coordinate and optimise operations. “The warehouse is becoming the engine room of the supply chain and is, therefore, a focal point for investment from retailers, manufacturers, and logistics service providers,” said Nick Finill, Principal Analyst of ABI Research. “As the warehouse technology ecosystem becomes increasingly complex, supply chain operators require more sophisticated management systems that can orchestrate the high volume and variety of intelligent, connected devices and systems within their fa-

10 CargoConnect - september 2019

As the margin for error in the warehouse decreases, AI and MLenabled WMS solutions are becoming imperative for warehouses that rely on speed, efficiency, and intelligence to remain competitive. cilities, as well as the flow of inventory,” added Finill. ABI Research finds that as the Ecommerce boom grows in and extends beyond the established economies of China, Japan, and Korea, the Asia-Pacific will experience the highest growth of warehouse facilities and WMS revenue, becoming the largest market for the software by 2023. The rapid adoption of WMS is also expected in the emerging economies of the Middle East, Africa, and Latin America. Europe and North America will experience strong growth with supply chain operator’s increased spending on upgraded software systems. WMS spending will also vary ac-

cording to industry verticals. The retail, food and beverage, and manufacturing sectors will be responsible for the highest growth rate as they catch up with more mature verticals, such as logistics service providers. ABI’s data suggests AI-driven innovation from WMS market leaders such as JDA Software, High Jump, and Manhattan Associates is enabling substantial flexibility and functionality in WMS and Warehouse Execution Systems, an increasingly important orchestration layer linking high-level management with connected machines. At the device and machine level, greater automation is creating demand for more sophisticated Warehouse Control Systems from major automated material handling solution providers such as Bastian Solutions, Dematic, and Honeywell Intelligrated. The increasing velocity of goods through the supply chain is driving demand for real-time decision making and optimisation. According to Finill, “As the margin for error in the warehouse decreases, AI and ML-enabled WMS solutions are becoming imperative for warehouses that rely on speed, efficiency, and intelligence to remain competitive.” CC

SPECIAL feature

12 CargoConnect - september 2019

The contemporary state of breakbulk Slowing global economic growth has cut into demand for construction materials, heavy equipment and breakbulk commodities, further pushing the global breakbulk and project cargo markets uncertain to recover from the current stagnation. However, it is interpreted that along with emerging markets like India where ocean carriers are targeting breakbulk to diversify their business, Persian Gulf states in the Middle East hold some promise for future project and breakbulk cargo imports.


Upamanyu Borah

september‑ 2019 - CargoConnect


SPECIAL feature


arket Forecast

Breakbulk, also referred to as Non-Containerised Cargo (NCC), Out of Gauge (OOG) and static cargo, is cargo that does not fit in or utilise standard shipping containers or cargo bins. Cargo is transported as individual pieces, shipped loose in the vessel’s hold and not in a container. Breakbulk was the most common form of cargo for most of the history of shipping. Since the late 1960s, the volume of break bulk cargo has declined dramatically as container cargo shipping has become more popular and taken over open cargo. Though breakbulk cargo shipping requires minimal port facilities, it is still very expensive and time-consuming process as compared to container shipping. Breakbulk cargo has following advantages and disadvantages in modern shipping phenomenon:  Breakbulk cargo requires special arrangements at the wharf.  It requires longshoremen, massive amount of labour, special warehouses and dedicated transportation to carry the cargo.  In the underdeveloped countries where ports are not offering modern facilities, breakbulk is still useful and works with minimal resources.  While containerisation is growing and the world is moving towards a modular method of transportation, there are inherent difficulties in moving Super OverDimension Cargo (SODC)/heavy lift and breakbulk pieces as containerised mode.

Although there is a decline worldwide as breakbulk pieces are being split for safety and cost reasons to be shipped via containers, the demand for breakbulk is still high in developing sectors like Southeast Asia and Africa. Theft is a concern only at certain low volume ports, but these can also be mitigated with the use of security. Rahul Rai

Head- Project Forwarding & Engineering Division, Allcargo Logistics

“With the rise of containerised cargo shipping, the volumes of breakbulk and project cargo movements on traditional bulk carriers are going down and we predict a further gradual decline,” says Steve Felder, MD – Maersk, South Asia. However, in the current scenario, Felder feels that with shippers resorting to cargo movement in just-in-time (JIT) mode; basis the need and requirement of certain parts of cargo, as opposed to shipping the entire project all at once, it is increasingly possible to containerise breakbulk and project cargo into smaller dimensions and volumes. According to Indroneel Sen, Director – Industrial Projects, DHL Global Forwarding, “In the immediate future, we will continue to see breakbulk shipments wherein specific expertise and competency would be required to move the units keeping in mind the parameters of size, weight and length and ultimately the final destination and on-carriage requirements to the final site.” Rahul Rai, Head- Project Forwarding & Engineering Division, Allcargo Logistics observes, “Although there is a decline worldwide as breakbulk pieces are being split for safety and cost reasons to be shipped via containers, the demand for breakbulk is still high in developing sectors like Southeast Asia and Africa. Theft is a concern only at certain low volume ports, but these can also be mitigated with the use of security (which does not cost more than 1 per cent of the logistics cost).”

14 CargoConnect - september 2019

Complexities in Breakbulk Shipping As rates for container and handysize bulk carriers have escalated, these operators have been discouraged from competing for breakbulk cargo. This is good news for breakbulk shippers and the network of domestic ports reliant on their business. Industry analysts have long noted that the constellation of breakbulk shipping is complex, comprising many distinctive industrial segments reliant on capital expenditure—both public and private. “The complexities differ from segment to segment. The percentage of capital investment would depend on the nature of goods,” informs Felder. For instance, a public body requesting the transportation of highly sensitive chemicals from the port terminal to warehouses, factories and further, would have to invest more capital due to the toxic nature of the cargo and the handling and loading/unloading of the same. Whereas, the same body awaiting shipment of paper/ paper reels would require less investment. Talking about India, Rai informs, “Complexities in India range from the inception stage, i.e. assessment of the route, managing the relations to access the sites for Super OverDimension Cargo (SODC) where the required basic infra such as roads are lacking. Besides, there is still a lack of centralised body for approval of movement and if these issues are not dealt with at the inception/budding stage, the detention and idle time charges for specialised equipment can push the logistics budget of the project completely off the rails.” Moreover, with regard to shipping, Rai says, there are limited specialised operators. The cost of shipping gets pretty hefty if the schedule of these breakbulk shipping lines can’t be aligned to the project schedule.

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SPECIAL feature

In the immediate future, we will continue to see breakbulk shipments wherein specific expertise and competency would be required to move the units keeping in mind the parameters of size, weight and length and ultimately the final destination and on-carriage requirements to the final site. Indroneel Sen

Director – Industrial Projects, DHL Global Forwarding

Globally, for large infrastructure projects, Rai believes, breakbulk is the only way and will continue as it is. “At present, there are multiple infrastructure projects that have been commissioned and are on-going in the country, namely IOCL Haldia, IOCL Barauni, HPCL Vizag, BPCL Kochi, Ladakh Solar Farm, IOCL Paradeep, NTPC Lara and Singrauli, Nepal/India 400kV Connected grid, along with various project exports by EPCs to regions like Nepal, Bangladesh, Afghanistan and Africa (West, East and Central). Import demand for these projects is also very high. So it can be said that the future is not as dim as it is made out to be. But caution on part of all players is definitely required to ensure safety of the project as well as cargo,” says Rai.

Transportation Management Going ahead, it seems, breakbulk does well when the global economy remains strong. However, breakbulk cargo transport requires that a number of uncertainties be well managed to mitigate risk of damages, missed key connections and accrued delay penalties. “There would always be some situations which are not in your control as is the case when you move normal cargo; breakbulk is no exception to that,” Raajeev Bhatnagar, Vice President, HTL Logistics India. “One would need to rely heavily on their experience along with reliability and that is how one would be able to take a well informed decision to minimise the risk,” feels Bhatnagar. Rai says that alignment and JIT principles are paramount to avoid delays and costs associated with the delays. “We keep a buffer of one day and ensure that all hydraulic and mechanical trailers are in the port and customs cleared for export at least 18-24 hours prior to loading. For import cargo, the trailers are ready at the port 2-4 hours before unloading starts. In both these cases, the strategy is to avoid any delay/detention for the ship as this would fall in the US$ 9,000-20,000 per day bracket,” adds Rai. While it is indeed correct to say that break bulk movements have a higher number of uncertainties that can lead to various issues along the supply chain, DHL Global Forwarding ensures quality by looking into the mentioned aspects (across), prior to acceptance of any order.

Industry estimates showed project cargo demand in India would rise at a 17 per cent compound annual growth, to $19 billion, by 2020.

16 CargoConnect - september 2019

 Confirmation of readiness and fabrication of the cargo  Selection of the right sized business partners (Heavy lift transporters, vessel owners and other key partners)  Adherence to a proper Transport Management System (TMS)  Strict implementation of HSE standards– a recently introduced digital platform simplifies identification of best-performing suppliers according to risk exposure and compliance  Deploying the right technical expertise  Drawing up risk management protocols  Implementing compliance The world’s largest container shipping company, Maersk, as well, accords the highest level of priority to Project Cargo also known as ‘Special Cargo’. All cargo moving on Special Equipment is treated with high priority when it comes to berthing and handling. In terms of breakbulk, Maersk performs extra level of checks to assess the state of cargo. The company has also been constantly innovating on the loading, packaging and lashing techniques to help improve efficiencies with certain cargo. Maersk prefer to take only direct, linear connections, to avoid the risks arising out of multiple handling at transshipment points.

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SPECIAL feature

In the container shipping industry, it is imperative to focus and improve breakbulk movement. In order to achieve this, it would require terminal acceptance for handling ODC parcels. This includes overweight cargoes as well as odd dimensions cargo, for which terminals should obtain technical skills in order to operate and handle the same on a container vessel. Steve Felder

Managing Director – Maersk, South Asia

Ro/Ro Trends Many Ro/Ro carriers, too, are competing for a diversity of cargo, including breakbulk and lift-on/lift off (lo/lo) shipments. Ro/Ro carriers are building ships designed to carry high and heavy and breakbulk cargoes. For example, Wallenius Wilhelmsen Logistics introduced the Mark V vessel a few years ago, a ship that the carrier describes as a Ro/Ro ‘super vessel’. A Panamax vessel that serves in round-the-world trades, the Mark V has over half a million square feet in deck area, of which over 330,000 square feet is reserved for high and heavy cargo. In short, everyone is competing against everyone. “The advent of container carriers and Ro/Ro operators entering the field of complex breakbulk operations is a welcome move as this would lead to the end clients having various options to ship and receive the cargo,” observes Sen. Some of the container carriers are active in this segment to primarily secure tonnage on their direct port-to-port calls to increase their revenues. The trend is catching up and shipping lines are coming up with increased value additions for breakbulk bookings. Echoing an almost similar response, Felder informs that Ro/Ro and Lo/Lo carriers leverage their rolling and lifting capabilities respectively, to handle breakbulk cargo. As such, Ro/Ro carriers have also started deploying capacity to become a part of and profit from this high paying segment. Pointing out issues of overcapacity that are rampant in the industry, Rai feels consolidation of Ro/Ro carriers is imminent and required. A few major routes are facing a supply glut, while lesser routes are overlooked and inducement charges for these push up the cost, which in turn forces the shipper to shift to containerised shipping, which becomes a vicious cycle increasing overall supply of breakbulk routes and not enough demand.

Balancing freight business in emerging markets As weak demand and overcapacity conditions continue to haunt container shipping, India’s growing breakbulk/project cargo trade is becoming a sweetener for ocean carriers operating to and from the Asian emerging market economy. In a prolonged, sluggish trade environment, ocean carriers have strategically shifted their focus to balancing their freight mix in order to create new revenue streams. Further, as India pumps billions into infrastructure development and accelerates domestic manufacturing efforts, ocean carriers believe the emerging market economy represents a lucrative market for all types of cargo — dry, refrigerated, and oversized. Further, India’s increasing participation in turnkey projects in the Gulf and in Africa is seen as another factor propelling local demand for project cargo handling. The government of India, for example, has vowed to invest $500 million in

18 CargoConnect - september 2019

the revamp of Iran’s Chabahar port, and vowed to sidestep logistics issues regarding a direct procurement of new harbor cranes from China for this project. Concerning the latter, Indian authorities were reportedly exploring the possibility of rerouting the ordered equipment via an Indian port. Gulf Agency Company (GAC) is tapping into growing project logistics and breakbulk business potential in India. Mark Delaney, Managing Director of GAC India says, “The country’s burgeoning energy and infrastructure sectors have contributed to an increasing demand for project and oversized cargo handling, as well as breakbulk shipping.” “Its potential is further bolstered by the significant investments made by India in Africa and the Middle East in the recent decades. With project cargo demand estimated to rise at a 17 per cent compound annual growth, project logistics is huge business,” says Delaney. Since the launch of ‘Make in India’, Delaney feels, there has been a significant increase in the project logistics business with the movement of construction equipment and manufacturing materials, among other OverDimensional Consignment (ODC). Industry estimates showed project cargo demand in India would rise at a 17 per cent compound annual growth, to $19 billion, by 2020. In another sign of that cargo trend, intended to achieve greater capacity utilisation, the MSC Sola — a 11,600-TEU ship deployed in the Himalaya Express Service between India and Europe — loaded a 100-tonne (110-ton) oversize freight item when it called at DP World’s Nhava Sheva (India) Gateway Terminal (NSIGT) in April last year. The shipment is the heaviest lift ever by any terminal at Jawaharlal Nehru Port Trust (JNPT) and that the complex operation cements its position as the most efficient terminal at JNPT.

SPECIAL feature

India’s burgeoning energy and infrastructure sectors have contributed to an increasing demand for project and oversized cargo handling, as well as breakbulk shipping. Since the launch of ‘Make in India’, there has been a significant increase in the project logistics business with the movement of construction equipment and manufacturing materials, among other ODC. Mark Delaney

Managing Director, GAC India

Rai underlines the reason for ocean carriers targeting breakbulk in India as a mix of both weak demand and overcapacity conditions that continue to haunt container shipping and to achieve greater capacity utilisation. “Greater capacity utilisation goals due to overcapacity are forcing breakbulk carriers to look to India. However, India is a tough country to crack, with immense pressure on safety and other standards while intense competition on the pricing part,” says Rai. Felder expresses a contrasting opinion. In the current market, Felder says, their general cargo business volumes are growing, hence, they do not see it as a case of weak demand and over capacity, rather a straightforward approach to tapping into a higher-yielding cargo segment and hence superior capacity utilisation. “The project business will only grow if the overall economy is growing, which in the case of India is what we are witnessing both on imports and exports of project cargo,” adds Felder.

Achieving the vision Many Indian ports has perceived that to further climb the ladder up by focussing on break and breakbulk cargoes, they have to remove certain major constraints that are impeding operations. Critical steps need to be taken to ensure seamless connections at port hubs and facilitating improved cargo operations. Sen observes that productivity at Indian ports is one of the major areas that need improvement thereby allowing vessel owners to be able to reduce their costs and pass the savings to the final customer. Besides, HSE and safe operations are another aspect of the port that needs to be regularly looked into and improved which would make shipping to/from Indian ports a viable business opportunity for the industry. According to Rai, current wharves have load restrictions that make them unsuitable for SODC, therefore the first and most critical step should be re-enforcing wharves across the country which will have larger per sq m strength as well as space to manoeuvre hydraulic trailers and large capacity cranes. The next step should be to improve access to major highways from ports with greater height and width clearance. Meanwhile, talking about the container shipping industry, Felder says that it is imperative to focus and improve breakbulk movement. “In order to achieve this, it would require terminal acceptance for handling ODC parcels. This includes overweight cargoes as well as odd dimensions cargo, for which terminals should obtain technical skills in order to operate and handle the same on a container vessel,” further says Felder. Highlighting the ground realities, Bhatnagar is of the opinion that in India, the export and import of commodities by nature moves in bulk, and that customers are looking for easy accessibility to the port, smooth operations and single window clearances along with regular inducement of vessels so that they can reach out to market faster and sell their products. Bhatnagar believes aligning these would be a critical first step towards realising the vision.

20 CargoConnect - september 2019

Deployment options Coinciding with how shippers negotiate rates with carriers, comes the challenge of selecting the ideal port for saving on total landed costs. While many of the world’s largest container ports can accommodate breakbulk, a handful of smaller ocean cargo gateways are becoming competitive specialists in this niche. In the Pacific Northwest, for example, the Port of Portland is marketing its Terminal 6 as a premier breakbulk option, although it can also handle containerized cargo. Portland’s Terminal 2 is a pure-play breakbulk terminal capable of handling steel rail imports from Asia. This is a good trend and India is no exception, says Bhatnagar. “We have a vast coastline and we must capitalise the same by offering competitive services as this helps in reducing the transit time, as cargo can then reach the nearest port quickly rather than always looking to move from few big ports in India,” states Bhatnagar. In India, Krishnapatnam, Dahej, Tuticorin are a few examples of ports that are focussing on attracting BB cargo with lower port charges and attractive location to nearby large fabricators as well as projects. “There is an increase in the inward and outward movement of project shipments with the growing Indian economy. Increasingly container shipping lines are trying to diversify their presence in breakbulk as it is perceived to be a profitable segment. This is creating necessity for gateway port terminals to invest in cargo handling capabilities,” mentions Felder. While this is a growing trend, imperative would be to work towards improvement in the sector in order to reach greater potential in breakbulk. “It is all about cost and service optimisation, and indeed many niche ports in India are gearing up and improving their graft restrictions, length of the piers, lifting capacities, etc. which would enable more breakbulk vessels to call on and provide a secure gateway for both the export and import cargoes,” notes Sen.

Futuristic Remarks

Even in future, certain commodities will forever come under breakbulk cargo segment. And to retain its attractiveness, the transportation of breakbulk has to be more efficient. “There are currently no alternatives to breakbulk transportation across the globe for ODC and Over Weight Consignment (OWC) cargo. This makes BB transportation attractive inherently,� says Rai. However, Rai explains, there is a need to reduce delays in emerging markets like Southeast Asia as well as standardise processes for lashing/securing and inland transportation to ensure peace of mind for both shipper and consignee. With above, Bhatnagar believes that the segment can be made more attractive by ensuring that handling is flawless, visibility is created, quick solutions are found to the problems and easy access to the ports is facilitated.

In India, the export and import of commodities by nature moves in bulk, and that customers are looking for easy accessibility to the port, smooth operations and single window clearances along with regular inducement of vessels so that they can reach out to market faster and sell their products. Aligning these would be a critical first step towards realising the vision. Raajeev Bhatnagar

Vice President, HTL Logistics India

Nonetheless, those that have invested in breakbulk-related IT has demonstrated some dramatic results. Just who will push more technology will survive in this era of uncertainity. Terminals are an obvious leader, but the actual owners of the cargo must have to pressure a thrust in technology.

Tracking the cargo as they are unloaded from a vessel, moved into storage and eventually retrieved and shipped out, is absolutely essential. After all, better identification and tracking means the cost of transport will come down. CC

cover story

driving Performance and Profitability in Automotive Logistics

22 CargoConnect - september 2019

cover story

Automotive Industry has been one of the dominant sectors to be reckoned with not only to the domestic but to the global economy as well. Outbound and Inbound operations are the two chief value chain activities which have direct bearing on the profitability of Automotive Supply Chains. Though industry is going through a transient phase of stagnancy, but in times like this, it is incumbent on stakeholders to focus upon long term growth to efface the short term volatility. Saurabh Sharma

september‑ 2019 - CargoConnect


cover story


he automot ive industry has undergone more profound changes recently than it has for many decades. Today, automotive supply chains have more significant part to play in order to ensure the sustainable growth by averting the environment of uncertainty created by short term volatility. Most of the Original Equipment Manufacturers (OEMs) view India as the strategic market for future; consequently the competition is bound to be high octane.

Logistics flow in Automotive Industry The influence of logistics on the automotive industry can be discerned by analysing the nature of the logistics channels present. This connection between the automotive industry and competitiveness through its value chain as a result of country’s logistics aspects play an important role in the strategic positioning of the local industry. Components and raw material can be sourced from all over the world as well as locally. The supply chain can be short and less complex for those that are sourced locally, or complex and more time consuming for those which have to travel long distances. Besides the different cost factors, it also requires a variety of modes of transport to be used. The most frequently used modes for local supply are road and rail, and for international supply, sea and air is added prior to road and rail. This also holds true in reverse for the flow of finished product. The common practice in the automotive supply chain for most of the automotive companies is that every chain is mainly tied to

It’s high time we started prioritising freight, and for which I have also requested a policy shift at the center. We need a system to track cargo shipments, by having improved timetables to monitor the incoming and outgoing of the ships. We also need to work closely with the Railway Ministry to make the operations profitable for licenses. N Sivasailam

Inbound and Outbound operations are the key factors in a value chain which drive the optimality in automotive supply chains. As every company employs a range of activities to bring its products to market, the idea of a value chain is to depict how customer value accumulates along a chain of activities that lead to an end product or service. Over the last few decades, owing to skyrocketing demand, the automotive industry in India has shifted predominantly into global competition but with the fluctuating production volumes and incessant increase in the cost of finished goods, the efficiency of outbound vehicle distribution operations has been affected as well. At this hour, optimisation of logistics operations through consolidation and collaboration among OEMs has tremendous potential to contribute to the profitability by lowering the cost of transportation, in-house inventory, transportation time, and facility costs. The collaboration in the intra- and inter-OEM outbound logistics operations is a critical area that the auto manufacturers need to pay attention to trim their cost.

24 CargoConnect - september 2019

Special Secretary, Department of Logistics, Ministry of Commerce, GoI

Logistics costs are high for India's automotive supply chain

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cover story Shifts in trends are on the horizon for India's automotive industry

With the ongoing impetus on expansion and development of different modes of transportation, we have to leverage multimodal transportation employing containers, rail wagons and coastal shipping. For optimising outbound logistics, we should consider lot size (sell few, buy few), order replenishment, mint condition, cost of logistics, network design, medium to long term plans and carrier optimisation. Jasjit Sethi

CEO, TCI Supply Chain Solutions

26 CargoConnect - september 2019

forecasts. The vehicle manufacturers must match supplies with demands from the first chain- raw material suppliers, to the last chain- car buyers. The variation or uncertainty of demand due to forecasting is produced from chain to chain causing bullwhip (when forecast leads to supply chain inefficiencies) effect. The new direction for automotive supply chain is still based in part, on the forecast and, in part, on the capable and responsive supply chain with a greater strategic emphasis, and subsequently, on the logistics operations. The current systems of the automotive industry mostly rely on build-to-forecast and/or build-to-delivery.

Competitive advantage and the value chain It’s a well established fact that Inbound and Outbound operations are the key factors in a value chain which drive the optimality in automotive supply chains. As every company employs a range of activities to bring its products to market, the idea of a value chain is to depict how customer value ac-

cumulates along a chain of activities that lead to an end product or service. The value chain approach can be used by companies or industries to better understand which part or parts of their value chain are yielding the greatest competitive advantage. Value Chain marks distinction between primary and secondary or support activities. The primary activities include those activities that are directly related to the delivery of the final product or service, which mainly comprise Inbound and Outbound Logistics.

Inbound auto supply chain Requirements Considering the humongous set of detailed logistics requirements for an automotive supplier, the real key is that in addition to optimising transportation and logistics costs, full inventory visibility and control is of foremost importance. One needs to wonder how an optimal level of analytics, visibility, and transparency has been provided using legacy systems.

In India, the auto sector along with auto components grab the highest share of the logistics industry which is over 40 per cent. The APAC region constitutes a major chunk of global automotive logistics with over 50 per cent of market share.

cover story The challenge for supply chain professionals will be to build a supply chain that is prepared to manage longterm growth but is also flexible and responsive enough to handle short-term volatility. Logistics requirements include the determination of carrier and related routing instructions in order to effectively manage inbound freight through the consideration of multiple factors including supplier location, product volume, packaging, transportation costs, and lead time.   Lead Time- For most supply strategies such as Just-in-time (JIT) supply, the supply chain needs to be relatively short to support low lead times. It is supplier’s responsibility to set shipping window times in conjunction with the manufacturing plant materials personnel and the carrier to ensure delivery by the date shown on the release.

For optimising supply chain operations in order to increase the profitability of the system, businesses must choose shipping option that is cost-efficient and ensure the goods aren't damaged in transit and delivered within the allotted time frame. Besides, following JIT concept helps ensure availability and reduce inventory cost, apply EOQ and MOQ. Senthil Kumar D

Lead- Sales Distribution & Logistics- LCV, Ashok Leyland

28 CargoConnect - september 2019

  A n a ly t ic s a nd v isibi l it y- Ca r r ier information must also be included in the supplier’s Advance Ship Notice (ASN) transmission to allow for trace-ability and to ensure supplier compliance to routing instructions.   Technology Advancement - A key role of newer technology is to ensure that scheduled

information from multiple customers in multiple regions with various production systems can flow accurately and consistently into a supplier’s internal business systems to streamline processes and make it easier to react quickly.   Authorisation- Authorisation must be obtained by the supplier from the appropriate receiv i ng pla nt mater ia l s person nel. Unauthorised expedited freight may result in debit to the supplier to compensate for excess freight charges and/or administrative fees. Underscoring the need to grasp the requirements of automotive logistics, Prem K Verma, Project Leader - Distribution & Logistics Strategy, Tata Motors says, “The Industry’s vision should be to facilitate needbased interactions for developing a better understanding of automotive logistics and t heir requirements. If t he automot ive industry wants to contribute to over 12 per cent to India’s GDP, as part of its vision under the ‘Automotive Mission Plan’ (2016-26), it needs to optimise its resources.”

Rising fuel prices and wages will drive up automotive logistics costs



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cover story State of Outbound Logistics Currently, most of the automotive OEMs operate their own outbound logistics network. The outbound logistics operations form the last step of the three main processes- order receiving from the dealers, manufacturing vehicles at the plants, and the lastmile transportation of the finished vehicles to the dealers. The automotive industry has one of the highest multiplier effects and many industries are allied to its fortunes. Automotive logistics is a vital cog in the overall functioning of the automotive manufacturing machinery.

The Industry’s vision should be to facilitate need-based interactions for developing a better understanding of automotive logistics and their requirements. If the automotive industry wants to contribute to over 12 per cent to India’s GDP, as part of its vision under the ‘Automotive Mission Plan’ (2016-26), it needs to optimise its resources. Prem K Verma

Chairman, Project Leader - Distribution & Logistics Strategy, Tata Motors

Since outbound logistics operations commence with the very moment of receiving an order, and then draws on further from warehousing process to the final delivery at the customer's end; it is rife with many speculations with regard to the choice of distribution channels and available delivery options. Over the course of time, organisations have realised the overhaul they require in order to enhance the profitability and efficiency of supply chain operations. In India, the auto sector along with auto components grabs the highest share of the logistics industry which is over 40 per cent.

The APAC region constitutes a major chunk of global automotive logistics with over 50 per cent of market share. According to a leading report, the region has the highest growth rate of 7 per cent and is expected to reach USD 110.9 billion. This growth forecast is on the back of rising vehicle production from APAC countries such as China, India, Japan, Thailand and Korea; which are also touted to be the next export hubs.

Multimodal Transport vs Distribution Network The vehicle distribution network of an automotive company consists of all activities required to deliver finished vehicles from the assembly plants to the dealers. The planning, scheduling and distribution of the vehicles to transshipment facilities such as Mixing-Centers and Ramps and to the dealers are a complex network flow problem. According to Navneet Shrivastava, Head of Supply Chain at Jay Bharat Maruti, “As the Outbound Logistics involves the processes of transferring and storage of products, and how related information flows from the end of the production line to the firm’s customer, this segment of logistics rely profoundly on transportation and distribution management.”

It is critical to have tailor-made supply chains for each region while monitoring forecasts and order-to-delivery.

Automotive logistics market, by region (US$ Billion)

30 CargoConnect - september 2019

cover story The life cycle of spare parts is longer than that of finished products and the total number of Stock Keeping Units (SKUs) is very huge.

Supply chain management of spare parts is even more complicated than that of finished products. The complexity of the parts business is generated by its own unique attributes. The life cycle of spare parts is longer than that of finished products and the total number of Stock Keeping Units (SKUs) is very huge. Additionally, the demand for parts is relatively unstable and difficult to forecast. All of these pose enormous challenges to parts planning, purchasing, ordering and logistics, among other operations.

While measuring the effectiveness and cost of supply chain, organisations will need to set up and monitor KPIs that give visibility of cross-functional activity as well as those applicable to individual supply chain components. The areas where KPIs will be necessary are order capture, inventory management, supplier management and warehousing. Navneet Shrivastava Head, Supply Chain, Jay Bharat Maruti

Talking about the optimisation of supply chain operations in order to increase the profitability of the system, Senthil Kumar D, Lead- Sales Distribution & Logistics- LCV at Ashok Leyland enumerates certain key factors: • Getting supply plan in line with manufacturing/customer requirements and scheduling it accordingly • Keeping warehouse which is managed by 3PL near to OEMs or the end consumer to enable supply timely • Businesses must choose shipping option that is cost-efficient and ensure the goods aren't damaged in transit and delivered within the allotted time frame • Following JIT concept to ensure availability and reduce the inventory cost, apply Economic Order Quantity (EOQ) and Minimum Order Quantity (MOQ)

“For optimising outbound logistics, we should consider lot size (sell few, buy few), order replenishment, mint condition, cost of logistics, network design, medium to long term plans and carrier optimisation. The only way to win is by working together and respecting the ecosystem,” says Sethi. Multimodal Transport Management Systems (TMSs) are catching up against traditional single mode transportation. The automotive industry must leverage multimodal transport to achieve efficiency in outbound logistics and reduce transportation costs. The current state of logistics in the Indian automotive sector is highly skewed towards roadways. Finished vehicles are transported

OEMs that develop shared goals and objectives with strategic suppliers can enhance the aftermarket supply chain. Owing to both vehicle import and export requirements from almost every continent, automotive finished vehicle transportation uses ocean, rail and road modes extensively. Every mode of transport has led to the development of custom equipment for vehicle transportation. Ocean carriers have developed multi-level roll on-roll off (Ro/Ro) vessels, also known as Pure Car Carriers (PCC).

32 CargoConnect - september 2019

Emphasising on the indispensable need of tapping the multimodal transportation Jasjit Sethi, CEO, TCI Supply Chain Solution explains, “With the ongoing impetus on expansion and development of different modes of transportation, we have to leverage multimodal transportation employing containers, rail wagons and coastal shipping. TCI has already been operating full racks since 2007 to serve its automotive clients and exploring other promising avenues like RoRo shipping, keeping up with the objective to reduce per CBU/Km cost for clients.”

directly from the factories to the dealers on specially designed car-carrier trailer trucks. Dr Saurabh Chandra, Associate Professor, Operations Management Area, IIM Indore suggests the anchorage of untapped opportunities in maritime logistics. “India has a long coastline, which makes it amenable to usage of coastal shipping for bulk movement of cargo as an environmentally friendly mode

cover story of transportation. Automotive manufacturing clusters have evolved in Northern, Western and Southern parts of India. However, the automotive manufacturers primarily use road transportation as a means of outbound logistics of finished vehicles from the factories to the dealers,” says Chandra.

India has a long coastline, which makes it amenable to usage of coastal shipping for bulk movement of cargo as an environmentally friendly mode of transportation. Automotive manufacturing clusters have evolved in Northern, Western and Southern parts of India. However, the automotive manufacturers primarily use road transportation as a means of outbound logistics of finished vehicles from the factories to the dealers. Dr Saurabh Chandra Associate Professor, Operations Management Area, IIM Indore

N Sivasailam, Special Secretary, Department of Logistics, Ministry of Commerce is counting on the potentialities prioritising freight would offer, and for which he has requested the center for a policy shift. “We need a system to track cargo shipments, by having improved timetables to monitor the incoming and outgoing of the ships. We also need to work closely with the Railway Ministry to make the operations profitable for licenses. The inland port at Pandu in Guwahati has railway and road connectivity as well as a

Analysis of various outbound logistics KPIs can be used to improve On-Time Delivery (OTD) performance and provide closed-loop feedback to the planning process. This has a direct bearing on capacit y planning to inform and keep production and logistics requirements in alignment with the organisation’s sales and marketing targets. Elucidating the importance of monitoring the KPIs, Shrivasta informs, ”While measuring the effectiveness and cost of supply chain, organisations will need to set

The automotive industry must leverage multimodal transport to achieve efficiency in outbound logistics and reduce transportation costs. port facility which can provide immense opportunities for auto industry’s development and employment. The Brahmaputra, which is more than 900km long, offers huge scope for providing logistic solutions for movement of goods across domestic and international channels," says Sivasailam.

KPIs and complexities in Outbound Logistics Key Performance Indicator (KPI) manifests the schedule adherence of the OEMs with respect to original order promise date at the

34 CargoConnect - september 2019

time of order acknowledgement. However, it takes more than mere optimisation to achieve the schedule adherence. The factors affecting delivery schedule start right at the time of sales planning and cut across the procurement and manufacturing process.

up and monitor KPIs that give visibility of cross-functional activity as well as those applicable to individual supply chain components.” Shrivastava says the following areas are those where KPIs will be necessary. • Order Capture • Inventory Management • Purchasing and Supplier Management • Production/Manufacturing • Warehousing • Transportation Managing the logistics involved in moving finished vehicles from factory to dealers (or, in some cases, directly to customers) requires an extensive transportation

cover story

and intermittent storage network. Vehicles are transported via road (trucks), rail and ocean modes. In cases where multimodal transportation is used, intermediate storage facilities are often used. Besides, the dependency of automakers on t he carr ier compa n ies for t he transportation of finished vehicles from the origin to the destination is yet another matter of concern for OEMs. This trend is also motivated by the increased cost of long haul trucking associated with increased oil prices and driver shortage.

Optimising or lowering transport cost is not about reinventing the wheel. It is about doing the little things that can really add up. Cost incurred on delivery or pick-up between a supplier and several manufacturing plants cannot be eliminated, but making better use of return trips by eliminating empty lanes can add up to big savings over time. D K Rai

R S Kapoor, Vice President, Maruti Suzuki India points the impediments associated wit h t he tra nsportat ion of produced commodities, “Despite several initiatives being taken up to improve rail growth, many factors are hampering the growth of the same, such as low turn around time and lack of adequate infrastructure in maintaining Automobile Freight Train Operator Scheme (AFTOs). At Maruti Suzuki, we have set an ambitious target of allocating 30 per cent of our produce by trains in the next five years.”

Curbing supply chain cost Today, because of the competitive market, automobile companies are bound to focus on

the product cost in order to sustain their presence in the market. Companies emphasise on many initiatives like Integrated Cost Reduction/Integrated Cost Management/ Value engineering. Out of many verticals where Integrated Cost Reduction can be applied, let’s emphasise on logistics. The very first concern, from the beginning of the supply chain where the decision is made as to where material will be sourced from, it has also become more prevalent that global sourcing by multinationals head offices makes these decisions. Cost of sourcing and transporting the raw material and components which add up to the logistics costs must be taken with alacrity by supply chain professionals. D K Rai, Director Aut o mo t ive, C H E P I nd i a o b s e r ve s, “Optimising or lowering transport cost is not about reinventing the wheel. It is about doing the little things that can really add up. Cost incurred on delivery or pick-up between a suppl ier a nd severa l ma nufac t uring plants cannot be eliminated, but making better use of return trips by eliminating empty lanes can add up to big savings over time.” Rai says that CHEP has redefined the way automotive components are handled through the supply chain. Automotive manufacturers and their suppliers collaborate to create a seamless eco-system based on

Director Automotive, CHEP India

Logistics plays a major role in order to reduce the cost of the product without reducing the material or process cost. Optimised logistics model becomes successful if it satisfies the demand and supply equation. 36 CargoConnect - september 2019


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Web-based IT systems are now used by OEMs and 3PLs alike for better visibility into transportation and warehousing facilities.

Transportation cost also increases due to fluctuating fuel prices and toll, warehouse cost and unplanned inventory cost which eventually result into increased cost and lack of financial performance. Outbound operations contribute a major portion of logistics revenue budget. Production and transportation lead time fluctuation influences a lot to maintain proper inventory. After eliminating practical issues like vehicle utilisation factor and cost/component, finally a workable model with a list of assumptions and considerations can only enhance the revenue benefits to the organisations.

Leveraging technology trends CHEP’s returnable packaging solutions that helps in cost reduction. “Our Collaborative Transport Solutions can save money and minimise the impact of customer supply chain on the environment. Our expertise helps customer carry more product on every truckload. We use software modelling to determine the optimal configuration for trucks, and then we conduct field tests to confirm these computer-generated recommendations. Optimised loads put fewer trucks on the roads, which in turn reduces customer costs, fuel consumption and eventually, CO2 emissions,“ informs Rai.

Despite several initiatives being taken up to improve rail growth, many factors are hampering the growth of the same, such as low turn around time and lack of adequate infrastructure in maintaining Automobile Freight Train Operator Scheme (AFTOs). At Maruti Suzuki, we have set an ambitious target of allocating 30 per cent of our produce by trains in the next five years. R S Kapoor Vice President, Maruti Suzuki India

38 CargoConnect - september 2019

With increased investments in IT infrastructure, most OEMs now want their 3PLs to provide vehicle tracking information using their vehicle identification numbers (VINs), right from the factory to dealer deliveries. Since vehicles change hands at many locations and handlers, information is often lost or not available with the OEMs. Web-based IT systems are now used by OEMs and 3PLs alike for better visibility into transportation and warehousing facilities. Automotive industry expects end-to-end visibility of the processes which their product

OEMs now want their 3PLs to provide vehicle tracking information using their vehicle identification numbers (VINs), right from the factory to dealer deliveries. Since vehicles change hands at many locations and handlers, information is often lost or not available with the OEMs. Logistics plays a major role in order to reduce the cost of the product without reducing the material or process cost. Optimised logistics model becomes successful if it satisfies the demand and supply equation. An optimised distribution network can significantly help in reducing the over supply chain cost of an organisation, says Sethi. “TCI SCS ‘Five Forces Model’ encompasses crucial factors like taxation elements, logistics network , response to customer, location of OEM plants and the overall supply chain cost to design a network. Keeping in mind OEMs’ unique needs and priorities, we take up to design and roll-out an agile and robust distribution network,” says Sethi.

undergoes, says Rajesh Kapase, Director- IT & Special Projects, Spoton Logistics. “Today, in order to accomplish these goals, continuous improvement in global supply chain execution has become a core supply capability required by most automotive OEMs. Strategies around lean replenishment and logistics must be deployed to accomplish performance goals, many of which may be required to remain in good standing. Executing these strategies requires manufacturers to fully leverage the potential of today’s innovative network-based supply chain systems and processes,” observes Kapase. Kumar D enumerates as to how the revolution in AI and robotics is revamping

cover story the auto supply chains in the new era: • Track and trace of the material through GPS and SIM technology which ease out tracking of the trucks and individual consignments • Monitoring vehicle performance through device which is enabled for engine performance and alerts for service • Accuracy on route travel and measure distance • Chip technology for indenting the en route destination • Software enabled device for POD Offering an insight into innovation for improving the efficiency, Rai explains, “The need is to deploy small but innovative practices to bring in optimisation. Adhering to standardisation, identifying opportunities to collaborate and prioritising sustainability are the steps to go about it. The starting point can be making the inbound supply chain more efficient by introducing the systematisation of packaging. At

CHEP, we combine physical platforms with IoT technologies through BXB digital to go beyond traditional boundaries and provide a more connected, intelligent and efficient supply chain.”

Looking ahead Many OEMs and some leading automotive supply chain oraganisations have taken robust initiatives to enhance their after market value. These include implementing various stages of pull based replenishment and spare parts branding with the assurance of full coverage throughout the distribution network. Suppliers and OEMS will need a consolidated and world class supply chain environment like dedicated vendor managed spare parts warehouses at key nodes of network, efficient multimodal transportation and reliable information systems in order to realise the competitive advantage to the fullest. CC

Strategies around lean replenishment and logistics must be deployed to accomplish performance goals, many of which may be required to remain in good standing. Executing these strategies requires manufacturers to fully leverage the potential of today’s innovative networkbased supply chain systems and processes. Rajesh Kapase Director- IT & Special Projects, Spoton Logistics


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feature Notwithstanding its size and significance, India’s Logistics sector continues to be a cog in the wheel of India’s economic growth. It’s high time stakeholders realised one of the remarkable but yet overlooked challenges India’s logistics sector is grappling with- the persistent ‘Skill Gap’ between the industrial requirements and available workforce. Saurabh Sharma

Creatingkills -s l a i t n e t o p s ’ a i d n I n i ambiencices sector logist iven the fact that financial growth of India relies heavily on the development of various sectors, especially the logistics sector, which caters to almost all sort of enterprises, has traditionally not been accorded the attention it deserves for an appropriate skill development framework, removal of disconnect between the demand for and supply of skilled manpower through vocational and technical training, building of new skills, innovative thinking and talents. The projected pace and efficiency demand making broad policies with regard to market requirements and coordination relating to mapping of existing skills as well as Industry-Institute

40 CargoConnect - september 2019

linkage for producing the skilled manpower, which is critical to usher the industry on the path of holistic development.

Squandering Demographic Dividend

For a country with more than 18 per cent of the world’s population and approx 520 million workforce, if ever there is a way to reap this demographic advantage, it has to be through skill development of the youth, so that they not only add to their personal but to the country’s economic growth, not only for the existing jobs but also the jobs that are to be created. Nonetheless, today more and more opportunities for invest-

ment is opening up in India’s logistics, manufacturing and services sector that is poised to utilise a skilled workforce. According to Dr D N Suresh, COOSCM Centre, Indian Institute of Management Bangalore (IIMB),” Demographic Dividend is realised only when all members of the workforce start contributing to the economy. To make that happen, the workforce must be properly trained, be quality conscious and have a positive work attitude. When the processes are well designed and standardised, the workforce will be more productive regardless of the type of sector whether logistics, manufacturing or service.” In today’s globalised world, organising and efficiency in skills training and management is an integral component for increasing efficiency and productivity, improving the development of any economy. India being a developing country and one of the fastest growing economies, the demand for skilled manpower is huge and rapidly increasing, and to cover this gap, it is very pertinent to re-engineer the skills ecosystem and improve utilisation of skills. And logistics being a service oriented sector, skill development is emerging as a key factor in the segment. Talking about the need of creating skilled workforce, Dr Nilratan Shende, Head CSR, Allcargo Logistics says, “When we compare percentage of formally skilled work force globally, India scores the least at 2 per cent against Korea (96 per cent), Japan (80 per cent), Germany (75 per cent), UK (68 per cent) and China (40 per cent). All these years, we focussed on building higher education, very little did we think about enhancing the Employability Quotient (EQ) and producing skilled manpower through skills training interventions.” Demographic dividend is the only pathway to skill the youth and seamlessly integrate those into their livelihoods and for a gainful employment. India has the age-advantage globally in this demographic dividend with one of the youngest populations in an aging world. “The growth benefit of a demographic dividend or its genesis is not automatic,” says Ramesh Venkat, Head – Industry Partnerships, Logistics Sec-

State-wise Demand-Supply gap of skilled manpower in logistics sector

Current Concentration

Growth Corridors

Potential Geographies

Tamil Nadu, Telangana, Andhra Pradesh, Karnataka, Maharashtra, Delhi NCR

Uttar Pradesh, Gujarat, Bihar, Orissa, West Bengal, NorthEastern States, Punjab, Haryana

Himachal Pradesh, Goa, Rajasthan

tor Skill Council. However, India’s future growth is to be well addressed and resolved in a Triple Helix model like the developed nations by the way of demographic dividend, else it will be a demographic disaster. “This means – the Government, the Academia and the logistics industry need to work in tandem and in a balanced manner to help Recruit – Train – Deploy skilled and educated ‘employable’ workforce into the sector,” says Venkat.

Need for Training and Skills Identification

There is a significant need to create an enabling environment and dedicate resources to support testing of new models for skill development across the logistics sector. As of now there seems to be not a single dedicated skills training centre for India’s supply chain industry except for Pradhan Mantri Kaushal Kendra (PMKK) which was established by the Ministry of Skill Development september‑ 2019 - CargoConnect


feature Dr D N Suresh and Entrepreneurship (MSDE). PMKK curates training programmes for India’s logistics industry in collaboration with the National Skill Development Corporation (NSDC), a one-of-its-kind public private partnership company, set up with the primary mandate of catalysing the skills landscape in India. NSDC is a unique model created with a wellthought-out underlying philosophy to proactively catalyse and create large and quality vocational training institutions. The initiative will pan across schools, colleges (UG/ PG), ITI, Polytechnics, Engineering, MS Data Science blended with On-the-Job-Training (OJT) for apprenticeships. Identification of the right skills in the workforce is yet another aspect that needs to be looked upon as it directly impacts the efficiency of operations associated with logistics and supply chain. While skill issues exist in varying degrees in all segments of logistics, the most severe and critical requirement for skill development is found to be in the surface transportation and warehousing segments. "Vocational training is possible only in organised sectors like shipping, railways and airlines. For road transport, warehousing and multi-modal logistics mangement, there are virtually no recognised vocation trainings available," informs Dr Suresh. However, there are certain industryled sector skills councils (SSCs) who strive to upgrade skills to international standards through significant industry involvement, develop necessary frameworks for standards, curriculum and quality assurance, and works in coordination with private sector initiatives for skill development. Logistics Sector Skill Council (LSC) is one of those not for profit organisations and sector-led industry apex body functioning under the Ministry of Skill Development and Entrepreneurship (MSDE) and National Skill Development Corporation (NSDC),

42 CargoConnect - september 2019

and promoted by Confederation of Indian Industries Institute of Logistics (CII-IL) - a centre of excellence in logistics. LSC aims to address skills shortage and facilitate skills management for various sub sectors like Warehousing, Land Transportation, Cold Chain, E-commerce, Port Terminals, Inland Waterways and many more, through the respective Ministries. The body also imparts apprenticeships under various programmes.

LSC’s service offerings

COO- SCM Centre, Indian Institute of Management Bangalore (IIMB)

Agility and safety are key basic requirements for efficient logistics. Both aspects suffer if skilled workforce is not deployed. Similarly, adoption of new technology and mechanisation suffer when adequately trained personnel are not available.

 Apprenticeship: MSDE and Ministry of Human Resource Development (MHRD) has nominated LSC as Joint Apprenticeship Adviser for India’s logistics sector to undertake the domain based skilling of fresh and existing

According to a White paper research on skill gap in Logistics by KPMG and CII, “There is need of synergy between government and sector. The government sees logistics as a high priority area and accords funds and resources towards skill improvement. There is sector wide focus on training and skills, right to the smallest companies, and the regulations and policies laid down are sincerely adhered to.”

manpower to cross-skill, multi-skill and up-skill from the bottom of the pyramid to senior managers with NSQF-levels with regard to National Occupational Standards along with functional analysis of each job role with lateral mobility.  Apprenticeship-based Under Graduate (UG) degree programmes: With the objective of bridging the skill gap in the industry, LSC has designed a 3yr UG degree programme for the logistics sector starting academic year 2019-20. The programme has been signed up with 21 institutions (colleges and universities) across the country. Logistics as a stream has be approved and mandated to be launched. It’s not only an initiative under ‘Make in India’ for the service sector but to promote ‘Start-Up India’ as well as ‘Stand-Up India’.

Allaying talent gap crisis

The logistics value chain consists of three key links or segments - Transportation, Warehousing and Value Added Services (VAS Services). While the skill requirements for transportation differs significantly depending on the mode of transport, trucking industry is most vulnerable when it comes to skill gaps in the surface transportation and logistics operations. The profession attracts largely unprofessional and illiterate people with no formal training for the job.

feature Enumerating the implications of unskilled workforce, Dr Shende says, “Skills required for transportation related warehousing such as CFS/ICD/ transshipment centers may differ to some degree on the mode of transport they are associated with. Value added services arise from leveraging core transportation and warehousing assets and hence may differ significantly depending on the mode of logistics. Representing the modal versus value chain perspective together reveals the unique segments that need to be analysed from a skills gap perspective.” If we highlight the repercussion faced by supply chain industries in the wake of unskilled workforce, it would count on the following aspects: • Less work productivity

• Cost incurred in training the Dr Nilratan Shende unskilled, and reviving affected Head CSR, processes Allcargo Logistics • Loss of working hours • Compromisation on quality work Skills required for transportation related • Adopting new processes, warehousing such as CFS/ICD/transshipment techniques centers may differ to some degree on the • Innovation/smart process mode of transport they are associated with. development Representing the modal versus value chain • Lower customer satisfacperspective together reveals the unique tion levels segments that need to be analysed from a • Straggling in competitive skills gap perspective. markets “Agility and safety are key basic requirements for adequately trained personnel are not efficient logistics. Both aspects available,” points Dr Suresh. suffer if skilled workforce is not deployed. Similarly, adoption of new techIndeed, industry leaders need to be nology and mechanisation suffer when more proactive as they recognise and

Segmental view of logistics sector and skill requirement for transportation


Road Rail Water Air 44 CargoConnect - september 2019


value-added services

Warehousing related to inland distribution whether inbound or outbound LTL transshipment centers

Services bundled around road transportation and warehousing like express, cold chain, track and trace, packaging, consulting etc.

Railway cargo transportation

ICD / CFS Multimodal warehouses

Services bundled around rail transportation and warehousing like dedicated rail container services, stuffing/de-stuffing, conslidation etc.

Shipping operations, Port development, Breakwater projects, Dredging, pilotage and towage, stevedoring, ship repair etc.

ICD / CFS Port-based warehousing Tank farms

Freight forwarding Freight consolidation NVOCC Customs clearance

Air cargo operations Ownership and operation of cargo aircraft

Air cargo transshipment warehouse

Express and courier services Freight forwarding Customs clearance

Trucking and related services like fleet management, network optimisation, route planning etc.



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feature Ramesh Venkat address the growing talent gap crisis in the supply chain sector. Though not an aspirational sector like retail, beauty and apparels where the traction for skilled workforce is not scarce, but definitely is one of transformational sectors owing to the remarkable use of technology and the parallel growth of other sectors that depend upon logistics for their appropriate functioning.

Gridlocks in skilling the youth

Informal sector has to date remained the backbone of the Indian workforce. It is no surprise that logistics sector is highly fragmented in India and falls in the same category, the small and medium enterprises will continue to be the primary source of employment and entrepreneurship. At the same time, despite engaging such a large proportion of the workforce, the productivity of such enterprises remains low. Enterprises face some unique impediments in availing themselves of formal skilling such as:  Lack of Awareness: Lack of knowledge of the logistics industry, career guidance and opportunities for youths  Lack of Alignment: Disharmony between current formal programmes and the skilling needs of informal enterprises  Lack of Training Centres: Scarce training facilities for sector specific training  Lack of Quality Trainers: Dearth of professional trainers  No Apprentice: Absence of OJT training for youths Workers and entrepreneurs in the informal sector often get trained by observing or working under master crafts persons or owners of small businesses. As they might not have any record of their training, developing mechanisms for formal recognition of an informal worker’s existing skills can benefit them tremendously. Trainers ought to be the seasoned worker from the same industry who requires sector specific trainings so that they can pass on the handheld experience and skills to novices. Many companies involved in sup-

46 CargoConnect - september 2019

ply chain execution have Head – Industry been understandably rePartnerships, luc ta nt to adopt new Logistics Sector technologies in the past. Skill Council There are several reasons why this has been India’s future growth is to be well addressed t he case (which we’ll and resolved in a Triple Helix model like look at in a future post), the developed nations by the way of but times are changing. demographic dividend. This means – the A failure to embrace Government, the Academia and the logistics this fact will be – and industry need to work in tandem and in a indeed, already has balanced manner to help Recruit – Train – been – the downfall Deploy skilled and educated ‘employable’ of mor e t h a n one workforce into the sector. business. Bar r i ng a few notable initiatives, any industry’s efforts in the years. Indian logistics sector gives training their employees is inadequate. employment opportunity to over 22 Besides, industry standards are not up million people. to the mark in the road transport and “Plethora of initiatives is Centrally warehousing sectors. Sponsored and State Managed (CSSM) Opportunities and initiatives and would benefit livelihoods of resiin Skills Training dential communities at the districts, Government as well as private sector is vicinity or the catchment areas of the focussing on skill development as one Port Terminals, ICDs, CFSs, and transportation hubs (multi-modal). Huge of the important part to reduce demand capital expenditure for port modernisaand supply gap of skilled manpower in tion, land ports (cross-border trade the logistic industry. A remarkable gateways), rail and metro corridors, transformation can be seen in the logistics sector on account of several reforms newer and better airports with facial and technological advancements over metrics, cold chains, liquid logistics, modern warehouses and automation, better mobility with larger to mega capacities, are the infra implemented and established for skilled development in this sector,” informs Venkat. With above, market leaders need to pull together their resources and clout for establishment of a nodal logistics institute or a network of institutes in support/partnership with the government. This would require not only Barring a few notable contribution and sharing of financial initiatives, Industry resources but joint identification of specific profiles in each segment, efforts in training their which in turn would need external training infrastructure and joint develemployees is inadequate. opment of standardised course curriIndustry standards are cula for every such profile. For example, specialised vocational courses not up to the mark in the would need to be developed for masroad transport and tering various activities like planning, inventory management, sales and opwarehousing sectors. erations planning (S&OP), and returns management, etc. CC



Indian Maritime Sector embracing the Digital Revolution 48 CargoConnect - september 2019


As India propagates to be one of the major economies in the world, the country would require strong and vibrant shipping industry for economic as well as tactical reasons. And, with the help of whopping investments, advanced technologies and modern techniques, bringing in the efficiency and efficacy, certainly the growth is inevitable. Ritika Arora Bhola, in line with experts, talks about the digital revolution and many factors conducive to the development of a robust and sustainable maritime sector.


echnology is truly proving to be the game changer for India’s logistics industry –in a prompt development phase at present and cont i nuously ma k i ng methodological advances, thereby, benefitting the economy as a whole. And the Indian shipping industry is nowhere behind. Of late, the Indian shipping industry has focussed majorly on equipping the sector with world-class technologies, realising that it is a vital component for overall development. India’s shipping ministry as well as private ports and terminals have invested whopping amounts in bringing in the newest technologies, which augurs well to the fact that India has been considered as a growing hub for the businesses and ranks among the most-attractive investment destinations for technology transactions around the world, alluring more and more international players to invest in the Indian tech market. There are two geographical factors that put the Indian maritime sector at

an advantageous position – the vast coastline of 7,500 km and the strategic location along most major shipping highways. For years, the maritime routes have been used for trade and a show of strategic strength. Today, the country boasts of a modern shipbuilding and shipping sector, replete with all the variables necessary for overall industrial growth. Combined, these factors provide a strong basis to attract big investments in the Indian maritime sector.

IT initiatives– an ocean of opportunities

The government has unveiled a host of initiatives aimed to develop and then sustain growth of the sector. As part of the governments push to fast-track investment in the sector, a host of business-friendly policies have been introduced. These range from modernising existing port infrastructure and creating new ones, to promoting green energy, skilling the talent to sustain the operation of the structure, and most importantly, IT development.

Con sider i ng t he above, C ap t Swaminathan Rajagopalan, Commercial Director, CMA CGM Agencies (India) says, “Although the digital innovation has come a bit late to the shipping industry, today the sector is not far behind. Today, we are seeing fast track adoption of technology. Stakeholders have understood the need to embrace digitalisation and be able to deliver the level of services and be competitive in the shipping industry. New technologies are the next big game changers, especially in Container Shipping- a labour sensitive shipping vertical and most exposed.” According to Sanjam Sahi Gupta, Director, Sitara Shipping, “The next great step forward for the human race will be delivered by new forms of mobility.” “Drones being deployed for emergency services to help in times of crisis, driverless cars tested on our roads; we are starting to see it. Talking about the advances in maritime autonomy - we’re already seeing unmanned vessels. And the technology offers huge promise.” Gupta continues, “Efficiency boost could make maritime even more competitive against road freight, which in turn would offers big environmental benefits. Drones can also be used over sea, for inspection of ships and further improving safety. Now, there’s also understandable concern about the effect that automation could have on jobs. These concerns should be taken seriseptember‑ 2019 - CargoConnect



Newest technologies ruling the Maritime sector Sanjam SAHI Gupta Director, Sitara Shipping The industry is facing a turning point, where technological developments such as autonomous and smart ships are turning the realms of science fiction into reality. At the same time, the sector is facing cost pressures and a stricter regulatory backdrop, as environmental restrictions persist and harden. The emergence of such a high level of innovation and change brings with it new risks as well as huge opportunities.

Capt Swaminathan Rajagopalan Commercial Director, CMA CGM Agencies (India) New technologies are the next big game changers in the Shipping Industry and mainly in Container Shipping. It is the most labour sensitive shipping vertical hence, it is most exposed and right candidate should benefit from the new technologies. Traditionally, shipping is considered as late adaptor to technologies or digitalisation. But, today we are seeing fast track adoption of technology from all the stakeholders in Container Shipping. ously. But, there’s also evidence that rather than destroying jobs, automation creates wealth. And that wealth creates opportunity, and opportunity means new jobs.” Veteran shipper and General Manager – Sales at OCPL Corporation, Suneel Nair, observes that not only the logistics industry, but the entire world and across industries – development and expansion is driven by the technology to a large extent. Nair says, “Today, technology has minimised cost and manpower and everything can be done online, e.g. the Enterprise Resource Planning (ERP) system- a smart software for accounts, finance, documentation, credit control, operation, etc. Such is the competition, that the need for latest versions of already existing technology is constantly upgraded and implemented. New technologies may not find the right use at its implementation, however, constant review meetings and

Recent times saw the entrance of some new technologies across the industry which is on their way to transform the operational processes and workflow: Blockchain: By reducing the cost of transactions, Blockchain allows the parties involved in the supply chain to save time and money. In addition, Blockchain technology will play a major role in reshaping the industry’s future by reducing the paper-work, connecting the parties directly and carrying out real-time exchanges of documents and transactions that too through a secured channel. Artificial Intelligence (AI): AI is already making things easier by seamlessly integrating new shipping logistics and communication technology to evolve the business model within the shipping industry. Further, with the help of new algorithms, the shipping industry can fully rely on AI for mitigating security risks and reduce the cost of operations to a great extent. Along with that, AI can help the maritime sector to respond to and work in accordance with the new environmental regulations and policies in a better way. Big Data Analytics: Data is the new, most important element of the present era. With multiple sources pouring data in abundance, Big Data Analytics will be an essential technology improving the operations of shipping industry. Green Technology: Green Technology can help the maritime sector to carry out its operations in a very costeffective and environmentfriendly way. Alternative fuels like LNG and in the future

bio-fuels and multi-fuel ships will be a reality. Robotics: We can expect the use of robots in commercial shipping for two main purposes- for handling assets, and for inspection and maintenance of the environments which are not safe for humans. Autonomous Ships: The unmanned vehicles cruising through the sea is the new reality. The major benefit of the sailor-less system will be the reduction in human-errors that would further enhance the safety in the sea. These systems will also extensively change the way through which current cargo ships explore, monitor and interact. Cloud-Based Technology: Cloud-based technology is known for providing access to the data easily and therefore will prove to be a groundbreaking technology for the shipping industry. Internet of Things (IoT): The latest IoT solutions are providing excellent aid for the maintenance of ships, and will continue to evolve in the coming days. With IoT at the work to scan and identify breakdown areas, it is easier to maintain the vessel and reduce the risk of accidents and miss-happenings due to faulty areas. Drones: Right from surveillance, photography, mapping and utilisation during emergency services, drones have a huge scope for exploration and implementation in the maritime sector.

A recent report predicts that by 2030, three new types of robots will be used in commercial shipping: a learning robot; one that can handle an asset – dubbed - a practical robot; and a mini-robot, potentially used for inspections in harsh environments, for example to identify and record emissions and pollutants. 50 CargoConnect - september 2019


Technology: The Right Ingredient For Air Cargo


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Rajesh Panicker Director, Kale Logistics Solutions

Suneel Nair General Manager – Sales, OCPL Corporation Smart and intelligent robotic technology will play a vital role in days to come.However, in the healthcare section, Robotics and AI is already in use for precision procedures conducted on patients. This will most certainly find a place in our industry as well which in turn will give a huge boost to the industry overall.

periodical classroom and brainstorming yields solutions for course corrections and up-gradation. Moving forward, it’s only enhanced technology that will be the game changer in our industry.” Agreeing with above, Rajesh Panicker, Director, Kale Logistics Solutions states, "One of the biggest impediments in shipping is the non-availability of knowing the whereabouts of the shipments till the ship reaches its destination port and any verifiable assurances that required conditions such as temperature has been adequately maintained." He further adds, “The use of shipment trackers enabled by Internet of Things (IoT) technology that bolster shipment reliability, visibility across the supply chain and optimises operational efficiencies, is just one such example of how new technologies are proving to be game changers that empower shipping to stay competitive, vis-à-vis air as a preferred mode of transportation globally even for time and temperaturesensitive cargo such as fruits. Blockchain is another technology that is already gaining ground in the shipping industry and in the near future it is likely to revolutionise supply chain logistics and cargo trade over maritime routes with its ability to improve cyber security in maritime transactions.”

Technology: Usability and Reliability

Logistic industry will stay as an inevitable support system without which

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The shipping industry is already out of the red, thanks to the technology innovations and adoption of new generation technologies such as Data Analytics, IoT etc. The future looks promising, especially given the research studies, such as the application of 5G in Ports that are under way and will likely have a gargantuan impact on the price and time competitiveness of the shipping industry vis-à-vis air or rail transport.

the trade cannot function, says Nair, as he believes smart and intelligent robotic technology will play a vital role in days to come. “However, in the healthcare section, robotics and AI is already in use for precision procedures conducted on patients. This will most certainly find a place in our industry, boosting the overall sector,” concludes Panicker. If we talk solely about the benefits that robots can offer to the shipping industry, one must note that, the use of robots on ships will increase with the heightening interest in creating autonomous vehicles. To make humans redundant on ships, robots should be able to perform and address concerns such as navigational issues, maintenance and other manual operations such as line handling. Robots will especially be useful for operating in hazardous environment be it for shipment storage and retrieval or dealing with perilous activities. Focussing on the advantages of the latest forms of technology-driven innovations, Panicker informs, “Drones have already had several applications in shipping, especially, in the realm of assisting surveyors on ships and in testing ship emissions. Algorithms could help computers on shipping vessels to comprehend and estimate the environmental and maritime conditions they could possibly encounter and also with plausible methods of problem-solving to such typical scenarios. And, for those that couldn’t

possibly be forecast, AI will be required. While, IoT is gaining popularity in shipping with liner operators opting this technology for container tracking and reefer monitoring.” Meanwhile, digging deep into how technology has helped revolutionise the container shipping sector in India, Rajagoplan explains, “Container Industry started evolution from Manual to Electronic about 15-20 years ago when hand typed B/L started to give way to Computerised Bills of lading (EDI). Apart from that no major evolution or change was witnessed by the industry, however, from the last two to three years speed of digitalisation has picked up the momentum. Today, shipping lines are looking at omni-channel ways to engage customers. New processes and business models are emerging on the basis of usage of technology in customer experience.” “Although, shipping lines today are engaging with customers either by their own online portal facilities or B to B connection for direct data transfer from system to system, we foresee more and more collaboration with connecting more stakeholders or common platforms to ensure next levels of efficiency gains in overall business model. This is where newer technologies like Block chain, AI and IOT comes in to picture for container industry to take the next leap. Primary objective of all these technologies is to use data as prime factor and works towards goal by optimally using the data,” observes Rajagoplan.


existing challenges


ith the growth and development, comes a set of challenges like Cyber-attacks, dearth of trained manpower, inadequate infrastructure, etc. that demands immediate attention of the government and private companies. Citing a report, Gupta says, “Research shows starkly that new and developing risks are holding back the full embrace of the potentially game-changing technologies. Successfully balancing the risk with the huge opportunities will be crucial in ensuring success today and beyond. It’s hard to say that just one technology will transform the industry, crucial is the interplay and overlap between the technology areas. The response from the industry has been overwhelmingly positive and supportive, and people are hungry for ideas about the future. There is also the chance for shipping companies to improve sustainability and fuel economy by using advanced high-strength steel, aluminum, and glass fiber and carbon-fiber composites. Despite

the advantages of more data and better analysis, the issue of cyber security and data protection remains. Data will have to be kept secure from malicious cyber-attacks.” Echoing a similar response, Rajagopalan says that with every new change, challenges and roadblocks comes as part and parcel of it. Since data is the most significant and usable form of asset, first and foremost challenge is to convince all the stakeholders to allow sharing of data in a transparent manner. “Data standards in logistics have long been elusive and have been only marginally more pervasive than in other sectors, despite industry-led and government-led attempts to harmonise data transfer between organisations,” explains Rajagopalan adding to the undeniability that overall acceptance from all the

stakeholders is a challenge which will remain as human factor. Panicker belives that a myopic attitude towards digitalisation is what plagues the shipping industry. What is needed is a strategic approach towards removing data bottlenecks, redundancies of processes and streamlining processes though automation and digitalisation. “Although there are some heartening use cases with regard to technology adoption, in the larger context of things, this is still the tip of the iceberg. The decided push towards technology adoption needs to be self-motivated rather than driven by regulation. The biggest bottleneck which needs to be addressed is data exchange between various stakeholders on a real-time basis which amongst others would enable better predictability, planning and operations for all those involved,” says Panicker.

september‑ 2019 - CargoConnect



sailing ahead


xperts believe that it’s quite evident that technology will help shipping companies stay competitive in increasingly challenging economic times in the coming years. Technology has definitely taken the industry to all together new level globally. And a lot can happen in the coming years, of course for the better. Panicker says that the future looks promising, especially given the research studies, such as the application of 5G in sea ports, that are under way and will likely have a gargantuan impact on the price and time competitiveness of the shipping industry, vis-à-vis air or rail transport. “Next generation Port Community Systems (PCS) are transforming port operations across the world and these tech-

54 CargoConnect - september 2019

nology-enabled platforms will likely spread like wildfire in the not so distant future for their sheer impact on operational efficiencies and dwell times for cargo at ports. Technology, as always, is poised to be the catalyst in keeping the shipping industry competitive,” maintains Panicker. According to Gupta, for the maritime sector, innovation-led change is nothing new. "But the industry now faces a turning point, where technological developments such as autonomous and smart ships are turning the realms of science fiction into reality. At the same time, the sector is facing cost pressures and a stricter regulatory backdrop, as environmental restrictions persist and harden. The emergence of such a high level of innovation and change brings with it

new risks as well as huge opportunities. One topic that stirs up much discussion is the use of robots. The report predicts that by 2030, three new types of robots will be used in commercial shipping- a learning robot; one that can handle an asset – dubbed a practical robot; and a mini-robot, potentially used for inspections in harsh environments, for example to identify and record emissions and pollutants,” she points out. Gupta also informs that power generation will change dramatically, with alternative fuels, energy-saving devices, renewable energy and hybrid power generation all potentially playing their part. The challenges are twofold- environmental and commercial, including rising fuel costs and fleet overcapacity. With climate change on


the agenda, Gupta says, testing of these new technologies – which could include diesel electric and hybrid propulsion – will most likely start in short-sea ships, tugs, offshore support vessels, yachts and inland waterway vessels. “Autonomous vehicles in the maritime sector will continue to increase to the point where autonomous surface and underwater vessels are viewed as just another aspect of the industry. These vehicles will greatly change the way in which those in the industry explore, monitor and interact with their environment. From a commercial point of view, the vehicles will be cost-efficient and widely used in deep ocean mining and oil and gas operations,” she adds. Rajagopalan emphasises on the fact that with growing digitalisation,

the manpower requirement to run businesses will reduce, and enlists a few milestones that the industry can expect in next 20-30 years.  Autonomous 50,000-TEU2 ships will plow the sea —perhaps alongside m o d u l a r, d r o n e l i k e f l o a t i n g cont a i ners—a nd t he volu me of container trade will be two to five times what it is today.  Short-haul intraregional traffic will increase as converging global incomes, automation, and robotics disperse manufacturing footprints.  Container flows within the Far East will remai n huge, a nd t he second-most significant trade lane may link the region to Africa, with a stopover in South Asia.  After multiple value-destroying overcapacity and consolidation cycles, t h re e or fou r major cont a i ner-

shipping companies might emerge: digitally enabled independents with a strong customer orientation and innovative commercial practices, or small subsidiaries of tech giants blending the digital and the physical.  Freight forwarding as a standalone business will be virtually extinct, since digital interactions will reduce the need for intermediaries.  All winners, closely connected through data ecosystems, will have fully digitized customer interactions and operating systems.  A fully autonomous transport chain will extend from loading, stowage, and sailing to unloading directly onto autonomous trains and trucks, with last-mile deliveries by drones.  Transparency and reliability to be the norm, not the exception. CC

september‑ 2019 - CargoConnect



India’s infrastructure push needs momentum


nfrastructure sector is a key driver of the Indian economy. The sector is highly responsible for propelling India’s overall development and enjoys intense focus from the Government for initiating policies that would ensure time-bound creation of world-class infrastructure in the country. Infrastructure sector encompasses power, bridges, dams, roads and urban infrastructure development. In 2018, India ranked 44th out of 167 countries in World Bank’s Logistics Performance Index (LPI) 2018. To achieve the target of $10 trillion economy size by 2032, a robust and resilient infrastructure system is required, supported by adequate private investments; India needs to spend 7-8 per cent of its GDP on infrastructure annually.

Investment Scenario The role of private investments into building a robust physical and social infrastructure is key to putting India in a high growth trajectory, helping potentialise it as a $5 trillion economy by 2024-2025. The finance ministry’s Economic Survey 2019, which captures key economic developments and also projects medium term objectives, underscores that private sector participation in the infrastructure space is crucial as funding cannot depend on public investment alone. “The real challenge lies in bringing adequate private investment across the country with the collaboration of public sector. Along with physical infrastructure, provision of social infrastructure is equally important as these two would determine where India will be placed in the

56 CargoConnect - september 2019

Reasons to invest in India • One of the world’s fastest growing economies – and growth expected to continue at 7-7.2% despite the current doldrums • Few restrictions on foreign direct investment (FDI) for infrastructure projects • Tax holidays for developers of most types of infrastructure projects, some of which are of limited duration • Opening up of the infrastructure sector through PPPs

world by 2030,” said the survey prepared by the Chief Economic Adviser Krishnamurthy Subramanian. India has the requirement of investment worth `50 trillion (US$ 777.73 billion) in infrastructure by 2022 for realising sustainable development in the country. At present, India is witnessing significant interest from international investors in the infrastructure space. Some key investments in the sector are listed below.

Indian infrastructure sector received 91 M&A deals worth US$5.4 billion in 2017. In 2018, infrastructure sector in India witnessed private equity and venture capital investments worth US$ 1.97 billion. In June 2018, the Asian Infrastructure Investment Bank (AIIB) announced US$ 200 million investment into the National Investment & Infrastructure Fund (NIIF).

Government initiatives vs PPP The Secretariat for Infrastructure in the Planning Commission is involved in initiating policies that would ensure time-bound creation of world class infrastructure in the country. This section focuses on power, bridges, dams, roads and urban infrastructure development. Details of the projects, organisations, policies, timelines, schemes, spending on infrastructure are provided for the users. While presenting the Budget 2019, Finance Minister Nirmala Sitharaman said that `100 lakh crore (roughly $1.45 trillion) is needed for infrastructure development across the country in the next five years. Sitharaman seemed to have chosen the words carefully when she said, “The government has announced its intention to invest this amount. The government would have to bring in `20 lakh crore a year to meet this target.” Infrastructure and construction sector has the 2nd largest share in in FDI inflows. Sitharaman said public-private partnerships (PPPs) were a way to go, given that the capital expenditure outlays of the railways were around `1.6 lakh crore per annum, way below the railways’ infra needs. The private sector, which has had an unsavoury experience with PPPs during the past two decades, is only cautiously optimistic of the government’s plan. Two big hurdles in PPP in India have been the misplaced focus on private participation in construction rather than brown field asset monetisation and the lack of dispute resolution and contract enforcement.

Road Ahead India’s national highways network is expected to cover 50,000 kilometers by the end of 2019. National highway construction in India has increased by 20 per cent year-on-year in 2017-18. India and Japan have joined hands for infrastructure development in India’s northeastern states and are also setting up an India-Japan Coordination Forum for Development of North East to undertake strategic infrastructure projects in the region. Looking ahead, it is imperative that infrastructure development occurs in a sustainable manner in India and around the globe, if the impact of climate change is to be slowed to broadly acceptable levels. The Government must maintain a commitment to ensure that rapid growth does not happen at an untenably high environmental cost and infrastructure projects will play a key role in ensuring the success of ‘Green Growth’.

september‑ september 2019 - CargoConnect


technology Why does it matter?

Perfecting production in SMEs using

Industry 4.0 A s everything is becoming increasingly more digital focused in recent years, it means the way things work is constantly changing and evolving. It comes as no surprise that the way businesses are run and their productivity - is changing too. The idea of the fourth industrial revolution (otherwise known as Industry 4.0),

58 CargoConnect - september 2019

allows digitalisation to connect all actors in the value process by fusing the production with information and communication technology. This can seem overwhelming – especially if you’re responsible for your organisation’s investment decisions. Why? Because ‘building a digital factory’ to provide your company with a platform for growth throughout the Fourth Industrial Revolution is no small undertaking - it is a journey of change.

The biggest manufacturers are pressuring their supply chain to deliver, even down to wanting sight of production plans and future capex. The main reasoning behind this is to ensure resilience throughout the entire supply chain. Proving to your customers that you are in control of your production and suppliers sounds like it could be time consuming. So, how do you do this without losing time in meetings and reports? Capturing and processing data will clearly show huge benefits for businesses and will also allow you to find efficiencies, boost productivity and improve performance. According to PwC, companies deploying Industry 4.0 initiatives expect to see a 2.9 per cent increase in revenue and a 3.6 per cent reduction in costs by 2020. However, switching priorities away from physical machinery and towards a digital system may not be a viable or simple switch for an SME which is constantly under pressure to fulfil customer orders. Taking the significance and potential scale of Industry 4.0 into consideration, however, it is definitely an industry trend that should at least be reviewed.


The impact on your business


MEs which are still in the early stages of considering what Industry 4.0 means to them will need to think about where they start as manufacturers need to address this challenge sooner rather than later. After all, Industry 4.0 incorporates a huge range of technologies, from the Internet of Things (IoT) to Big Data analytics and EDI up and down the supply chain. Instead of focusing on Industry 4.0 as a whole, however, it can be simpler to start with your business priorities – and then see how the technology can help you achieve those goals. Below are five areas where SMEs can use Industry 4.0 to enhance their operations:

to collaborate on projects online and automatically notify customers on the progress of their orders. Software solutions which incorporate the technology from Industry 4.0 will allow more accurate and open communications, helping businesses to build and maintain rapport with their clients.


Compliance and traceability

Manufacturers face increasing pressure to prove components and materials they produce meet a range of quality standards and are ethically sourced. For example, aerospace demands evidence of tolerances and QA levels, whereas food manufacturers are required to prove provenance as consumers expect traceability through every stage of food production. Having a digital system in place will help SMEs track and trace materials whilst fulfilling compliance requests automatically.


Optimised processes


Better resource planning

A businesses main priority should be enhancing its ability to manage resources; greater visibility across the business ensures the right volumes of materials are in stock or on order at any given time. An accurate oversight will also reduce the risk of over-ordering, which will ultimately save cash flow. Additionally, customers receive boost in confidence when they become certain that a business is able to fulfil orders. There are many software solutions out there that help with aspects such as resource and material requirement planning and are an ideal place for most companies to start making to transition; particularly SMEs.


Streamlined operations

It can be difficult for you to get excited about back-office functions when you are dedicated

to and passionate about perfecting your product or service. That being said, digital systems automate timeconsuming admin tasks, such as timesheets or expenses, allowing key personnel to concentrate on more important tasks and functions; which should be the main focus of your business. Certain software solution systems also strip out old paper-based processes, allowing growing companies to expand without investing in additional administrative staff.


Stronger customer relationships

Integrating a customer relationship management (CRM) system with an ERP will allow manufacturers to identify sales trends, anticipate orders, liaise with clients and ensure forecast demand is fulfilled. Utilising a digital system allows your business

Managers have to make sense of all information which is fed into systems from all arms of an organisation. This can be a very time consuming process, but business intelligence dashboards have the ability to consolidate the data and provide greater oversight. This will in turn help in identifying areas of improvement, such as removing production bottlenecks. This kind of software solution also processes orders more efficiently in comparison to the conventional way. This is done using scheduling and planning systems to identify the impact of schedule changes and planning different scenarios; answering the ‘what if’ questions, or ‘can we take on this rush order?’ Adopting Industry 4.0 will allow SMEs to start rolling out optimised processes by creating a digital platform to grow their business. This will be the foundation that helps companies thrive through the Fourth Industrial Revolution. By Andy Brown, Divisional Sales Manager at Access Group september 2019 - CargoConnect



"We are The market leader for Ro/Ro operations in India" How has your company evolved overtime to be one of the most sophisticated and dynamic shipping and logistics business conglomerate?

Höegh's ship owning history dates back to 1927. Since then, the company has been a pioneer in the international shipping industry. During the 1960s, the company transported cars with lift-on/lift-off (Lo/Lo) vessels. In 1970, a joint venture was formed with Ugland which shaped Höegh-Ugland Auto Liners (HUAL). This company became the basis for developing Höegh into a world leading roll-on/roll-off (Ro/Ro) operator. At present, Höegh Autoliners operates approximately 50 pure car/truck carrier (PCTC) vessels in 12 trade routes

i n global t rade systems, performing about 3000 port calls annually. Höegh has the world’s largest PCTCs in its fleet, especially designed to take on high, wide and heavy cargo, often referred to as breakbulk or project cargo, in addition to cars. Höegh is also involved in landside logistics, such as terminal operations and supply chain optimisation through its daughter companies.

How big is India’s automotive logistics domain for Höegh?

India is growing at a very rapid pace in automotive manufacturing. Today, all global OEMs manufacture in India, ser v i ng a l l categor ies. Höeg h

With a fleet designed for maximum flexibility, Höegh Autoliners is able to cater to a wide variety of cargo, ranging from cars to high and heavy and breakbulk. In India, the company already has a strong foothold and the company intends to further strengthen its services in and out of the country. Anil Saini, Country Sales Manger- OEM, Höegh Autoliners, speaks to Upamanyu Borah, about their best-inclass services and comprehensive capacity solutions offerings, and how they are making their presence felt in the Indian market.

60 CargoConnect - september 2019

Autoliners started its operations in India from Mumbai in 2009. In this 10year time, the company has established itself as the market leader for Ro/Ro deep-sea operations in the country. The expected Completely Built-Up (CBU) units export for India in 2019 is around 800,000 whereas domestic consumption is around 4 million. Exports are growing year-on-year at approximately 10 per cent. Höegh Autoliners was the proud recipient of “Best Shipping Line of the Year – RoRo Operator” award for the third consecutive time this year at the India Maritime Awards held in Mumbai, India.

To what extent has Höegh been responsive to India’s dynamic market and innovating its logistics management process?

Indian OEMs are located in various states. India has one of the biggest waterlines covering both east and west side of its territory. Höegh Autoliners has been dynamic in adapting to these useful resources, reducing the overall logistics time for the OEMs. Höegh’s vessels are calling at various ports in India in order to carter to the OEM’s requirements. Besides, Höegh has been successful in working with Indian shippers who transport project and breakbulk cargo. In India, Höegh offers specially designed solutions and has its own specialised equipment to handle it. The company recently shipped the longest breakbulk piece on a RORO vessel out of Ennore in Chennai. Höegh is constantly developing its breakbulk capabilities as new business opportunities arise around the globe. This gives Höegh’s customers in India access to any new competence and innovation in breakbulk handling that the company develops globally.

While transporting highlysensitive breakbulk cargo, what strategies do Höegh adopt to ensure full cargo optimisation on board on the vessel?

The PCTC vessels that Höegh operates are well suited for breakbulk cargo as it does not have to lift the cargo like Lo/ Lo vessels do. Höegh rolls it in and out. This is much safer for the cargo. Be side s, a l l t he c a rgo i s loaded underdeck, prohibiting any saltwater intrusion. Höegh’s new Horizon-class vessels are designed to cater to a changing cargo mix, where 5 of its 14 decks are hoistable. This means the vessel’s cargo capacity can be utilised to t he ma ximum t h roughout t he voyage. Höegh’s experienced port captains plan the cargo operations in each port, ensuring efficiency and that cargo is loaded safely and for an optimal stow on board.

Höegh is constantly developing its breakbulk capabilities as new business opportunities arise around the globe. This gives Höegh’s customers in India access to any new competence and innovation in breakbulk handling that the company develops globally.

How far has Höegh been successful in implementing technology to effectually streamline your logistics services?

Technological development happens at all levels in the company and constant focus is on improving the services offered to customers. This year, Höegh implemented a new booking and doc umentat ion system, and soon c ustomers w i l l w it ness t he new e-services being introduced. Another great technological development to support vehicle manufacturers comes from Höegh’s daughter companyAutotrans which focusses on supply chain optimisation and has introduced an app that digitilise and streamline the vehicle inspections utilising smart

cont rac t s based on bloc kc ha i n throughout the finished vehicle supply chain.

Höegh has achieved many milestones by loading record volume of export vehicles across continents. What best practices and standards you apply and abide by for an overwhelming customer experience?

Professionalism is one of Höegh’s core company values. It is a leading star in all of Höegh’s services and operations, helping provide trustworthy, quality service to its customers at all times. The combination of a global product and local presence with specialist knowledge is a winning recipe.

How will Höegh strategise on its future offerings in order to maintain itself as a profitable company in the shipping and logistics sector?

Höegh closely follows the market trends and continuously thrives to offer new products and services to customers as newer and newer needs arise. Over the last few years, Höegh has been successful in building its breakbulk share of shipments. The investments into this segment will continue to rise more and more.

What are Höegh’s competitive advantages for the future of seamless automotive logistics?

Höegh’s competitive advantage is the dedication, skill and enthusiasm of all its employees across the globe. Besides professionalism, agility is another core value at Höegh. Going forward, nothing will be more important than having an organisation that is agile and ready to turn ideas into actionable products and services. The fact that Höegh can offer a complete supply chain solution with its own vessels and in cooperation with its landside logistics companies, guarantees a seamless and high-level service proposition throughout the supply chain. CC

september‑ 2019 - CargoConnect



Productivity milestones advances Hutchison Ports Sohar’s strategic initiatives Tell us about Port of Sohar’s exclusives.

Port of Sohar is a deep sea port situated midway between Dubai and Muscat. Strategically located outside the Straits of Hormuz and on the international sea routes, Port of Sohar is closer to the growth markets and economies. The port area is more than 45 square kilometres and it contains 22 berths. The port connects the Sohar Free Zone which attracts local and international investments and is increasing the volume of handling. Medium-sized commercial ships, wooden ships and fishing vessels ply their trade in the handling of livestock and agricultural products through this point of entry. Sohar now ranks as one of the world’s fastest growing port and free zone developments and is fast becoming one of the Middle East’s prime industrial and logistical hubs.

Tell us about Hutchison Ports Sohar’s ultra-modern container terminal C.

Hutchison Ports Sohar manages the container terminal C at the Sohar Port and Freezone. It is situated in the Port of Sohar, outside the Straits of Hormuz in the Gulf of Oman, approximately 200km from Muscat and 160km from Dubai. The terminal is an ultra-modern container-handling facility capable of accommodating the latest generation of mega-vessels with its eleven Quay Cranes, out of which four are remote controlled super post-Panamax quay cranes operated from the state-of-theart Remote Operations Centre. The cur-

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rent handling capacity of the terminal is 1.6 TEU million per year. Until the end of 2018, the terminal has handled more than three million Twenty-Foot Equivalent Unit (TEUs) since its operations in 2014.

How has the investments been since origination and where will it be going forward?

So far, Hutchison Ports Sohar has invested over 300 million US$ since it started operations in Sohar in 2014. As an integral component of Sohar Port and Freezone, Hutchison Ports Sohar is committed to help realise the Oman Vision 2040 through our enhanced efficiency and continuous investments in the startof-the-art automated equipment and technologically advanced systems.

How far have Hutchison Ports Sohar been successful in

implementing technology and automation to effectually streamline its terminal handling capacity?

We continuously strive to enhance the services to ensure ease of business for our c ustomers. We have adopted Hutchison Ports’ award-winning Next Generation Terminal Management System (nGen) to ensure the highest level of efficiency. In our commitment to continuously i mprove busi ness processes a nd e n h a nc e ele c t r o n ic i n for m at io n services, we will be launching a mobile app ‘ubi’ later this year. It’s an online e-tracking service which updates vessels and gate schedules and tracks container shipments. Shipment tracking will allow port users to plan movements for exports and imports well in advance of a vessel’s arrival. Once ‘ubi’ is ready, our existing Truck Appointment System (TAS) will also be integrated into

Hutchison Ports Sohar is a joint-venture between Hutchison Ports, ASYAD-the most comprehensive end-to-end logistics provider in the Middle East and a number of wellestablished Omani investors. It is a modern containerhandling facility capable of accommodating the latest generation of mega-vessels. Today, Hutchison Ports Sohar offers over 60 direct calls every week to 30 ports covering all major ports in China, South East Asia, Indian Subcontinents, the United States and Middle East. Anacin Kum, CEO, Hutchison Ports Sohar informs Pallavi Jain the competitive edge they provide with the combination of the talented team at the terminal and the new equipment.

it. TAS allows truckers to schedule collection and delivery of cargo prior to their arrival at the terminal gate, and getting in hassle-free and without any delay through the auto gates with paperless documentations. Safety and security of the personnel and cargo is at the heart of Hutchison Ports Sohar. We are an International Ship and Port Facility Security Code (ISPS) certified container terminal. In 2018, we inaugurated the state-of-the-art Security Control Centre with a video wall showing live footage from 210 CCTV cameras across the terminal. It is the first-of-itskind in the maritime terminal business in Oman. It helps the security centre’s personnel to monitor terminal activity around the clock and is equipped with an emergency response alert system that allows for instantaneous notification of the Royal Oman Police and Port of Sohar in case of any incident.

How do you look at transshipment cargo? How much does transshipment cargo currently add to Port of Sohar’s business volumes?

Sohar Port is an ideal transshipment hub for any shipping line due to the ultramodern and state-of-the-art container terminal infrastructure and strong local market growth. In 2018, transshipment cargo volumes accounted for 11 per cent of the total container through put in Hutchison Ports Sohar. From vehicles to perishables and consumer goods, Hutchison Ports Sohar is playing a key role in bringing the world to the residents of the Sultanate with a growing number of direct calls. Currently, we are handling 12 weekly sailings connecting Sohar to the Middle East, China, North Asia, South East Asia, the United States and Canada, Indian subcontinent, etc.

How is Hutchison Ports Sohar dealing with the rising requirements and challenges with respect to supply chain optimisation, integration and co-ordination?

Hutchison Ports Sohar has steered and initiated several marketing initiatives in order to grow the consolidated cargo volumes from India and China. This will enable the container cargo importers in Oman to bring their cargo directly into Port of Sohar instead of depending on logistics providers who operate from the other port terminals in neighbouring countries.

What are Hutchison Ports Sohar’s plans and initiatives, especially for the Oman-India route development?

The trade growth between Hutchison Ports Sohar and India has been remarkable in the last five years with a compound annual growth rate (CAGR) of 90 per cent, and we are confident of growing this business furthermore. The terminal currently handles weekly calls under Nhava Sheva Mundra Gulf Express (NMG) service and Hapag Lloyd operated India Gulf Service 1 (IG1). We

are closely coordinating with a couple of more feeder operators to increase the feeder network and weekly frequency between India’s west coast ports and Port of Sohar.

What potential does Sohar Freezone offer to Port of Sohar in terms of business, leading to port development?

Soha r Fre e zone ha s d i rec t ly contributed to new customers who bring in export import container volumes into Port of Sohar. In addition to the key growth sectors of oil and gas, logistics, metals and mining and food cluster, cotton cluster is a fresh addition that will help propel the growth in the coming years.

We are looking at increasing the feeder network and the weekly frequency between India’s west coast ports and Port of Sohar. Hutchison Ports Sohar has been structurally investing in its Corporate Social Responsibility (CSR) Policy. How far have you been successful in your initiatives?

Leadership and responsibility go hand in hand. And as a ne twork of ports that stretches across many countries and continents, Hutchison Ports help the people, communities and cities where it operates. For years, Hutchison Ports Sohar has been running CSR initiatives that focus on Education, Community and Environment development. Hutchison Ports Sohar has sponsored Ramadhan activities at the headquarters of Al Batinah North Governorate, opened training centres in schools in Sohar, facilitated summer training programmes for school kids, sponsored Ministry of Transport & Communications’ activities, and financed Oman Chamber of Commerce & Industry’s efforts to produce a documentary film in order to promote investment opportunities in Oman, among various other initiatives. CC

september‑ 2019 - CargoConnect


Supply chain teams need to master- Agility, Adaptability, Alignment

Shipper Speaks

It’s not difficult to see how the financial health of a business depends on that of the supply chain, or how probable it is that supply chain costs feature strongly in the demise of many companies that become insolvent. Atul Holkar, Head of Supply Chain Mangement at Varun Beverages- PepsiCo briefs Saurabh Sharma just how significant the supply chain and its management are to the success of businesses operating in today’s local and global markets.

Organisation and Operations

Varun Beverages Ltd (VBL) is the flagship company of Ravi Jaipuria (RJ) Corp, a highly diversified business conglomerate with interests in beverages, quick-service restaurants, dairy and healthcare. VBL has been associated with PepsiCo since the 1990s. Being the second largest franchisee of Pepsico in the world, outside US, for Carbonated Soft Drinks (CSD) and Non-Carbonated Beverages (NCB) sold under trademarks owned by PepsiCo, VBL produces and distributes a wide range of CSDs, as well as a large selection of NCBs, including packaged drinking water. PepsiCo CSD brands sold by us include Pepsi, Diet Pepsi, Seven-Up, Mirinda Orange, Mirinda Lemon, Mountain Dew, Seven-Up Nimbooz Masala Soda, Evervess Soda, Duke’s Soda and Sting. PepsiCo NCB brands sold by us include Tropicana (100 per cent, essentials and delight), Tropicana Slice, Tropicana Frutz, Seven-Up Nimbooz, Gatorade, Quaker Oat Milk, and packaged drinking water under the brand Aquafina.

Countering Challenges

Once the supply chain structure is in place, it is only the day-to-day challenges that need to be resolved to ensure uninterrupted supplies. In the current scenario, supply chain team of companies needs to master the art of triple A’s- Agility, Adaptability and Alignment, to ensure total synchronisation with the business needs. Few of the supply chain challenges

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we face in VBL are typical and likely to be faced by any FMCG company.

Supply Chain Management

Below are a few factors to address our business success:  Forecast Accuracy: VBL is constantly introducing new products, changing the mix, and adjusting package sizes to spur sales. With this kind of changes, we have no margin for error – especially considering that the products have short shelf lives. We are in a make-to-stock business, and the customers expect the products to be available exactly when and where they want it. Despite a robust demand planning process, the efficient use of technology remains a challenge.  Geographical Spread: VBL’s business is spread across the length and breadth of the country. The volumes to be delivered of each product have grown tremendously. Supply chain has to en-

Today’s logistics service providers must deal with a staggering amount of complexities in the form of fragmented channels, expanding product variations, and increasing customer demand for customised solutions. sure that all our products are available in every nook and corner of the country at all times. However, with the support of technology and robust IT systems, it

has now become manageable, but regional flavour preference is another issue that considerably affects our inventory planning and management.  Seasonality: Given the limited shelf life of our products, inventory management along with seasonality remains a key challenge across the distribution chain. With vast geographical spread of the business, seasonality plays a very important part in our business planning. It starts with capacity planning, stock levels and logistics. Any sudden change in weather remains a risk, though with 35 plants located across the country, we have adequate capacities to deal with the mood swings of the nature.  Warehousing and Inventory Management: We have Distribution Management System (DMS) and Warehouse Management System (WMS) for inventory management. With demand of our products at an all-time high, the pressure on the manufacturing and supply chain to move the products quicker and more efficiently, is paramount. Our operations, production capacity of every plant are severely tested during the peak season- March to July, the pressure on the supply chain team and our distributors gets very demanding. Adequate backup plans always exist to ensure that our supply chain is flexible enough to meet any challenges in distribution in case of any alternative sourcing to meet the peak demands.

Expectations from LSPs

Supply chain in the beverage industry is undergoing a rapid transformation,

which is perplexing and also seems overwhelming. As manufacturers create more diverse set of product options and packaging designs, supply chain also has to keep redesigning itself to meet these challenges. Today’s logistics service providers must deal with a staggering amount of complexities in the form of fragmented channels, expanding product variations, and increasing customer demand for customised solutions. There are certain scopes and expectations associated with LSPs in various supply chain operations, which includes:  Management of warehousing processes including inventory management  Look after primary transportation.  Secondary distribution and reverse logistics.  Having an expertise to operate large WMS-based warehouses.  To have a mix of own and market hired transport fleet.  Having the experience to work in a technology driven environment.  Having an agile and cost-effective system in place.

Managing back-end operations

VBL has a highly robust, agile and technology driven supply chain which is the backbone of its distribution. However, there are certain aspects to look into while managing the back-end operations.  Procurement: VBL has a dedicated procurement department, and uses eprocurement platform. The department operates in harmony with sales and manufacturing and derives its input through Sales and operations planning (S&OP) synchronisation. VBL’s suppliers and transporters are embedded in the business and considered as partners

after they understand our business well. Once they are well-aware of our geographical and seasonal challenges, we expect them to ensure uninterrupted support.  Inventory Management: We have a vast range of products and our consumers expect availability of ‘chilled’ Pepsi brands at their arm’s length without fail. Stock availability is an important matrix to assess the performance of the supply chain. Being a food product, balancing between stock levels and freshness always remains a challenge in inventory management. A robust analytics based dashboardreflecting array of indicators from production to sales allows us to ensure optimised inventory management. Besides, our robust demand planning structure supports us in overcoming issues related to optimised inventory management.  Distribution: Efficient distribution is key to the success of any business and more so in beverage business. In VBL, distribution is monitored up to the tertiary level. We use technology to monitor our production, distribution and sales extensively. Technology ensures visibility of the orders, stock movement and fills rates, which further aids to planning.  Reverse Logistics: In our business, efficient reverse logistics is an import factor to ensure business profitability. To ensure that the empty glass bottles are picked up from the market for refilling requires an agile and cost effective planning. More number of bottle turns as an important Key Performance Indicator (KPI) of Supply Chain performance.

SCM trends to latch onto

There are various trends that need to be kept in mind in the supply chain which will navigate the optimality of operations. Internet of things (IoT), Artificial intelligence (AI), big data, analytics, blockchain, Augmented Reality (AR),

robotics and drones, have changed the dimensions of industries. The manufacturing industry has been hit by a technological wave. Following are the factors on which the industry needs to shift its focus:  Digital Supply Chain: Most of the repetitive jobs will be handled by machines/robots leaving the important ones for human intervention. The future will see a paperless supply chain with the advent of block chain and new e-regulations, while employing IoT, robotics and ATVs, supply chain tracking will achieve speed, visibility and certainty.  Facility Planning: Technology will be helpful in virtual visualisation even before the physical construction of any storage facility. One can run the entire process virtually and ensure readiness and contingency plans, much before the actual constructions begin. It will be big saving of time and money, and will greatly support in planning and training even before the facilities take shape.  Freight/Container Loading: Augmented Reality (AR) could replace the need for a physical cargo list and load instructions. The head up displays will provide with all the stepby-step processes and will be guided at every stage. This will help in better tracking and visibility besides monitoring the state of the cargo.  Dynamic Traffic Support: Today, most delivery trucks come equipped with GPS navigation, but AR systems are the natural successors. Heads-up and windshield displays will allow carriers to efficiently re-route shipments on the move, without causing any significant distraction to the driver. The display will show the driver critical information including cargo temperature, fuel efficiency, etc.  Artificial Intelligence (AI): With AI powering supply chain leaders and operators with advanced predictive technologies that model future scenarios, companies will be able to operate a more effective supply chain. This in turn, will be a game changer for the company’s business. CC

september‑ 2019 - CargoConnect


Shipper Speaks

From ‘planning of product’ to ‘physical possession at the patient’s end’, logistics transforms it all Pharmaceutical companies with large turnover place a particular emphasis on supply chain management. This is because any variation in the supply chain could lead to multiple disturbances in the system. Similarly, companies like Pfizer (PFE) spend millions of dollars to ensure the safety and supply of their products, even though they have manufacturing units in multiple locations. Sudhir Mohan Bansal, Vice President and India Head of Supply Chain Management at Pfizer Pharma informs Upamanyu Borah how specialised outsourcing partners for key supply chain activities provides pharma companies with significant cost and flexibility benefits.

Genesis and Operations

Pfizer came into being almost two centuries ago in 1849. Starting with fine chemicals, today, we are one of the biggest pharmaceuticals company of the world. By the dawn of the 20th century, Pfizer was doing great business. It was only during the World War II when Pfizer produced large quantities of Penicillin for the war victims and transported it to Europe. The company made its impact, gaining lot of popularity throughout the world. By the mid20th  century, Pfizer had its empire spread through nearly ten other countries; the expansion followed to other countries in the next few years. Currently, Pfizer is spreading out operations under Pfizer Global Supply (PGS) to across 167 countries around the globe from its manufacturing sites located in 58 countries. In India, Pfizer has two organisational setups. One is for complete domestic consumption with renowned brands operating more than 7 decades whereas the other have been completely focussed on exports catering to the US, Europe, Australia, New Zealand, and Middle East.

Strategic Initiatives

Pfizer harnesses operational and supply chain data from enterprise systems

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to identify processes to better meet the needs of patients. In 2017, this information helped Pfizer to address drug shortages of several injectable medicines used in hospitals and other clinical settings, enabling us to put appropriate strategies in place in anticipation of need of the patients which culminates into sizeable demand for the pharma sector in general and Pfizer in particular.

Setting the supply Key Performance Indicator (KPI) in excess of 98 per cent on various categories and continuous review process at various hierarchy level ensures highest availability of medicines for patients at all time. There are robust processes and tools that measure inventory levels at each transit point, on-time supply and demand fluctuation index on a daily basis, conducts gap analysis and decides faster to replenish stock and channelise supplies through a flexible supply chain mechanism to let the products reach to the patients when it is most needed. Setting the supply Key Performance Indica-

tor (KPI) in excess of 98 per cent on various categories and continuous review process at various hierarchy level ensures highest availability of medicines for patients at all time.


At present, flexibility should be viewed from a complete value chain perspective that satisfies customer needs even when unexpected changes happen. For this, we are required to build capabilities in the system in anticipation with several situations based on previous experience and market realities. For instance, increase in demand would necessarily affect line capacity, workmen, quality infrastructure and service level agreements with contractors. For this, we try to make products approved on more than one line, creating a pool of trained manpower/SME and effectiveness of transportation on alternative routes so as to use those when it matters. Vendor Managed Inventory (VMI) would also help to replenish stock at faster speed for which a robust process is to be built besides maintaining good relations with suppliers.

Overcoming Challenges

Supply chain encounters various problems since it has to deal with several departments that plan, procure, manufacture, inspect, store, dispatch till last-

mile delivery, with each highly influenced by both individual and interdepartmental challenges and bottlenecks. Therefore, changes in demand, either going up or down, would have inherent effects in terms of shortage or high inventory. Supply chain has to walk on tight rope, continuously reviewing situation and exploring various options with an aim to meet customer demand, using technology and troubleshooting at the right volume in the right time.

Steps towards IT

In the last several years, exponential growth of Information Technology (IT) and its application which have largely helped supply chain. Since the last decade, imbibing digital trends has become an integral part of supply chain, helping play a crucial role in optimising decisions for achieving organisational competitiveness, improving higher service levels and lowering inventory, overheads and delivery time, besides preserving the paperless record for an audit trail which is widely acceptable for statutory compliance. Most of our activities are governed by IT applications, viz. EDI, RFID, Barcode, ERP, GPS and data logger (which ensures the state of products as continuous surveillance without physical supervision). IT has played a significant role for an accurate and reliable forecast planning despite various geographical, seasonal and periodical factors without which survival of any supply chain would be next to impossible.

Establishing Coordination

At Pfizer, supply chain plays an important role being at the centerstage, as it gets inputs from market network team which is evaluated with forecast planning for any adequate changes, and accordingly sends signals to suppliers and LSPs enabling them to accommodate the variation in terms of SKUs, volume and mode of transit with the aim to maintain desired level of inventory at various stock points. Internally, these signals would be sent to revise priorities of production schedule, packaging, quality release and dispatches

which involve production, quality, WH and logistics respectively. There are certain rules and guidelines to be followed for addressing quality, regulatory and safety aspects that supply chain has to ensure with an eye on patient’s well-being, besides continuity and sustainability of business.

Routing API

Current trend of logistics is highly influenced by the competitive environment. In order to reach first and fast to the market place, yet at minimal cost, it would be prudent to make logistics services outsourced. There is an essential need to use technology and automation in every gambit of logistics that encompasses alternative routes, modes, equipment besides live information availability at all times on 24/7 basis. It would require large funds to be invested with longer gestation period, hence outsourced logistics has become a necessity, helping pharma companies to concentrate on their core area of of-

In order to reach first and fast to the market place, yet at minimal cost, it would be prudent to make logistics services outsourced. There is an essential need to use technology and automation in every gambit of logistics that encompasses alternative routes, modes, equipment besides live information availability at all times on 24/7 basis.

fering best quality of manufacturing.

Significance of Logistics

Logistics have enormous importance as it has the ability to transform from ‘planning of product’ to ‘physical possession at the patient’s end’. During this, a product undergoes numerous stages, it travels across multiple transit points before reaching the destination within the stipulated time frame. It also deals with 3 major elements of Cost, Quality and Delivery (QCD) that lead to decide for mode of shipment (Road/ Air/Sea), packaging style, container size (20/40 Ft, LCL/FCL), efficient documentation and various compliance including temperature control, statutory labelling, transit damage and pilferages.

Outsourcing of Logistics

We have stronger tie-up with our trusted global partners that enable us to capitalise on economy of scale, reliability and load bearing capability during significant volume increase. At the same time, we emphasise on maintaining reasonable share of business with local players based on their credentials and resourcefulness, which helps us during adverse situation that arise due to social/political factors. CC

september‑ 2019 - CargoConnect


N Sivasailam

Special Secretary - Logistics Ministry of Commerce & Industry, Government of India

Nidhish Kucchal

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Dr Venkata Ramana Akula

Divisional Head - Parts Centre and Transport Honda Motors Pvt Ltd

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Avinash Gawade

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Ajeet Kumar: +91 9810962016 ajeet@surecommedia.com  Smiti Suri: +91 9711383365 smiti@surecommedia.com Rahul: +91 7011609817 rahul@surecommedia.com pallavi: +91 8700809249 pallavi.surecommedia@gmail.com  akash: +91 8383061964 akash.surecommedia@gmail.com rahul jain: +91 9560484905 rahuljain.surecommedia@gmail.com

Amazon expands delivery network in Tamil Nadu

Centre to invest `100 lakh crore in Infrastructure: PM Modi


rime Minister Narendra Modi has committed to a five-year vision of investment-led growth, saying a massive `100 lakh crore will be spent on developing infrastructure that will help in achieving the target of $5 trillion economy. Exuding confidence of achieving the target of $5 trillion economy, PM Modi said fundamentals of

the economy are strong and a stable government coupled with predictable policies can become a catalyst including in attracting other nations to invest in India. PM Modi said, the GST, which subsumed nearly oneand-a-half dozen central and state taxes, brought to life the dream of ‘’One Nation, One Tax’’ and the country has also

achieved ‘’One Nation, One Grid’’ in the energy sector while attempt is being made for ‘’One Nation, One Mobility Card’’ for seamless travel across the country. PM Modi has scrapped obsolete laws to make it easier to do business in India and is now targeting a position in top 50 nations on the World Bank’s Ease of Doing Business ranking.

India, France finalise roadmap on digital technology partnership


ndia and France has concluded a path breaking road-map to make digital technology a transformative factor in their societies, to fight terror, to foster economic growth, sustainable development and secure enhanced internet access which is essential to bridge digital divide. Both the countries recognise the shared responsibility of a wide variety of actors, in their respective roles, to improve trust, security and stability in cyberspace. They call for the strengthening of the

multi-stakeholder approach to ensure an open, secure, stable, accessible and peaceful Digital environment, and stress that this requires joint efforts by governments, industry, academia, and civil society, according to the roadmap. India and France also affirmed their willingness to re-

inforce their cooperation, notably through the sharing of information between their cyber security agencies, in order to prevent malicious activities, undertake immediate corrective response, mitigate their potential impact and identify their causes. Both the countries also welcomed the potential offered by the development of artificial intelligence (AI), particularly in the field of sustainable development, e-governance, autonomous transportation, smart cities, cyber security, health, education and agriculture.


-commerce giant Amazon has launched its largest delivery station in Tamil Nadu. The new station in Chennai will enable Amazon to strengthen its last-mile delivery network and ensure faster deliveries across the city. The company announced that it will expand its delivery network in Namakkal, Tiruchengodu, Sivakasi, Krishnagiri and Tiruvallur. With this expansion, Amazon will have over 120 owned and ‘Delivery Service Partner’ stations, and more than 1,400 ‘I Have Space’ partners across the state. The growth of delivery network will help the company penetrate into smaller towns across Tamil Nadu. It will also have a direct delivery presence in more than 1,200 pin codes, enabling customers to enjoy one-day and two-delivery promises.

Gateway Rail Freight starts ICD operations at Viramgam


ateway Rail Freight, a subsidiary of Gateway Distriparks has started Inland Container Depot (ICD) operations at Viramgam near Ahmedabad Gujarat. The first export train service from Viramgam was flagged off by Deepak Jha IRTS, Divisional Railway Manager, Ahmedabad. Also, present at the occasion were Sushant Kumar, Additional Commissioner- Customs and Amit Kumar, Joint CommissionerCustoms. The first consignment of export containers of Honda Motorcycle and Scooters India Ltd (HMSI) was cleared under V H Bisht, Assistant Commissioner of Customs.


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AJEET KUMAR: +91 9810962016 ajeet@surecommedia.com SMITI SURI: +91 9711383365 smiti@surecommedia.com RAHUL: +91 7011609817 rahul@surecommedia.com PALLAVI: +91 8700809249 pallavi.surecommedia@gmail.com AKASH: +91 8383061964 akash.surecommedia@gmail.com RAHUL JAIN: +91 9560484905 rahuljain.surecommedia@gmail.com

n ews Commerce ministry hopes for an E-commerce Government e-Marketplace


commerce ministr y cabinet note proposes that Government eM a rk e t pl a c e (G e M ), t h e sarkari online procurement platform, be retooled to also

offer a business-to-consumer (B2C) retail option. If the plan goes through, consumers and businesses will be able to buy products listed on GeM by private companies, exactly as it is

in private online marketplaces. This approach of the GeM to open the portal for consumers and private players will definitely help the domestic market in India and will be a tough fight for the foreign players. The government is also planning to introduce an Ecommerce policy, which will set a maximum limit on the discount that can be offered on a product. Keeping this planning in mind, the FDI in E-commerce guidelines have forbidden online marketplace from holding more than 25 per cent share in an online seller.

Boost coastal shipping in India: DG Shipping Amitabh Kumar





ncreased movement of cargo by improving the coastal shipping network and infrastructure is the need of the hour, said Director General of Shipping, Amitabh Kumar. The government has been investing in the road network, which is logical, as roads are also used by people, but it has not been able to invest as desired in coastal shipping. Kumar said, “Modernisation is left to the ports, and they in turn recover the cost from customers, which is hampering global competitiveness." He said, “The regulatory framework could be relaxed to facilitate 49 per cent FDI to stimulate coastal shipping, with 51 per cent remaining with the Indians and with it the ownership of the vessel. Further, overseas Indians should also be allowed to invest in the sector and the

Essar Ports cargo handling up 17% in Q1


rivate ports operator, Essar Ports Limited posted overall 17 per cent growth in the cargo throughput at 13.5 million tonne for the first quarter of current fiscal as against 11.5 MT in the corresponding quarter last year. For the quarter ended June 30, 2019, Essar Ports reported an impressive 17.4 per cent growth in cargo volumes across its four terminals. The growth, according to the company is triggered by the higher capacity utilisation at its recently commissioned terminals at Salaya and Vizag ports and an increase in third-party cargo. The combined throughput stood at 13.5 million tonne - up from 11.5 million tonne in the same period last year.

Flipkart partners with NSDC to train 20,000 delivery executives


vessels could be registered in the country.” Taxes should be reduced by the Union Finance Ministry to bring down costs. Availability of cargo was another major problem, and ports should set up dedicated coastal cargo berths. Multi-modal logistics parks coming up in the country will address some of these issues, he added.

almart-owned Flipkart has partnered with National Skill Development Corporation’s (NSDC) Logistics Sector Skill Council (LSC) to train 20,000 of its delivery executives (wishmasters) across the country. This partnership is intended to certify the supply chain workforce in all aspects of product delivery and customer experience. As part of the training program, Flipkart in conjunction with LSC is conducting 8-hour training modules for its delivery executives to impart them with the knowledge on the finer nuances of the delivery mechanism.

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n ews vehicles direct access to the cargo terminals and air cargo logistics centre (ACLC), including the upcoming cargo city. According to a statement issued by DIAL, this 3 Km long four-lane dedicated elevated road will provide hassle-free, safe and seamless movement of trucks carrying cargo to the airport and will not disrupt regular traffic. It

Dedicated elevated corridor at Delhi airport for hassle-free movement of cargo


elhi International Airport (DIAL) will start construction of a dedicated elevated corridor to keep away vehicles carrying airport cargo from regular traffic, thus

reducing congestion. Delhi airport will be the first airport to have a dedicated road for trucks carrying cargo into the cargo complex via the NH8. This dedicated road will also provide

will also ease the traffic movement on the airport’s main approach road — the Central Spine Road, which is currently being used by both passengers as well as cargo vehicles.

IWAI aims 120MT inland waterways cargo movement by 2023


nland Waterways Authority of India (IWAI) said it aims to increase cargo transportation through this mode to 120 million tonne by 2023 from the current 72 million tonne. IWAI officials said it continues to make crucial interventions that would pave the way for ecofriendly cargo movement on the national waterways. In this endeavour, the National Waterway-1 is important

and IWAI is creating necessary infrastructure to falicitate private investors to rope in the fuel-efficient transport mode. A nu mb er of cargo owners including Adani Wilmar, PepsiCo, Emami Agrotech, IFFCO Fertilisers, Dabur India have already come on board inland waterways.

IWAI has put a ‘robust ecosystem of fairway, berthing, pilotage, river information systems and night navigation facilities on river Ganga’, IWAI officials said.

Proposal for new international courier terminal at Hyderabad airport


proposal has been tabled to start a fifth international courier terminal at Rajiv Gandhi International Airport in Hyderabad after Delhi, Mumbai, Chennai and Bengaluru, informed MRR Reddy, Principal Commissioner of Secunderabad GST Zone. Reddy, who recently headed the Hyderabad Customs Commissionerate, informed that in order to determine aggregate rankings in customs processing, the Air Cargo Complex of the Rajiv Gandhi In-

74 CargoConnect - september 2019

ternational Airport in Shamshabad has been selected leaving behind 14 custom stations across the country. Reddy also informed about the recent initiation of the process for custom rankings. The customs department, along with Air Cargo Complex, Shamshabad and KPMG which has been appointed as a consultant will study the processes at different customs stations for the rankings, an important part of which will be the Cargo Release Time.

KCBA organises Workshop on E-SACHIT and new customs procedures


anpur Customs Brokers Association (KCBA), member association of the Federation of Freight Forwarders’ Associations in India (FFFAI), organised a workshop on E-SACHIT and new Customs Procedures on July 27, 2019 at ICD Juhi Rail Yard. The workshop was attended by a large number of the KCBA members to interact with domain expert speakers. Tej Mayur Contractor, President, Indian Institute of Freight Forwarders (IIFF) and Executive Committee member, FFFAI; C N Mishra, Deputy Commissioner Customs and KCBA office bearers addressed and interacted with the participants regarding current issues on GST, Customs Clearance Procedures under GST resume and trade facilitation.

Hyderabad Airport adds SpiceXpress freighter service


MR led Hyderabad International Airport has added yet another domestic freighter to its existing range of offerings with the latest entrant being SpiceXpress. The cargo arm of SpiceJet has commenced its services connecting Hyderabad with Delhi, Mumbai, Bangalore and Chennai. With this, the airport now has six scheduled freighters. The 737-700F type freighter aircraft used by SpiceJet will operate 6 days every week, arriving from Chennai at 9.45 pm and departing for Delhi at 10.45 pm. This service will connect Chennai – Hyderabad – Delhi – Mumbai – Bangalore sectors and has a capacity to carry approximately 20 MT of cargo

14 05 2020

Meet and network with 200 plus


N SIVASAILAM Special Secretary Logistics, Ministry of Commerce & Industry, Government of India

GOVIND CHAUHAN Head- Logistics H&M

A K JAIN General ManagerCommercial ORIENT CRAFT

DR ANIL CHINNABHANDAR Sr VP- Supply Chain & Planning LIFESTYLE INTERNATIONALMax Retail Div (Landmark Group)





ARVIND OBEROI GM- Sourcing and Merchandising IMPULSE

KRISHNA KANT PANDEY National HeadDistribution & Logistics and Omni Supply Chain SHOPPERS STOP







Asia’s Largest Event AJEET KUMAR: +91 9810962016 ajeet@surecommedia.com SMITI SURI: +91 9711383365 smiti@surecommedia.com RAHUL: +91 7011609817 rahul@surecommedia.com PALLAVI: +91 8700809249 pallavi.surecommedia@gmail.com AKASH: +91 8383061964 akash.surecommedia@gmail.com RAHUL JAIN: +91 9560484905 rahuljain.surecommedia@gmail.com

n ews Maersk Partners With BlackBuck for truck aggregation

Kolkata is a top warehousing hub now


est Bengal, particularly Kolkata and its suburbs, is fast emerging as one of the major warehousing and logistics markets in India. According to sources, deals worth `500-`700 crore are already in different stages of discussions or are being inked. Kolkata and the suburbs took up warehousing space to the tune of 3.5 million square feet last year (in 2018). Some of the areas that are fast turning out to be the hotbeds include those along the Na-

tional Highway 2 (Delhi Road) and National Highway 6 (Bombay Road). As per sources, some 500 acres of land across villages along the Delhi Road and Bombay Road areas are under negotiations. In fact, logistics-focused global PE funds and developers such as Morgan Stanley, ESR (backed by Warburg Pincus), Allcargo Logistics, Indospace, Embassy and others are the ones puttingin big money.

Sagarmala Advisor lauds Allcargo’s efforts to build skill competencies


harda Prasad, AdvisorSagarmala Project, Ministry of Shipping, visited the Allcargo Logistics Pradhan Mantri Kaushal Kendra (PMKK) at JNPT and praised the efforts of the company in conducting skill development programs for underprivileged youth and boosting their employability opportunities in India’s rapidly expanding logistics sector. Prasad during his a visit to

the Allcargo Multi Skill Development Center at Bokadvira, Uran, flagged off the new Pradhan Mantri Kaushal Kendra (PMKK) batch of Consign-

ment Track i ng exec ut ive, graced the convocation ceremony of t wo pa s s ed- out batches and felicitated working students on the occasion.

Nepal freight forwarders should collaborate for mutual benefits: FFFAI


ederation of Freight Forwarders’ Associations in India (FFFAI) has urged the Nepal Freight Forwarders Association (NEFFA) for greater collaboration between them for mutual benefits and enhancement of bilateral trade. S Ramakrishna, Chairman, FFFAI, made this appeal while speaking at the Silver Jubilee Celebration function of NEFFA held in Kathmandu on 29 July 2019.

76 CargoConnect - september 2019

Ramakrish na also recommended that a meeting should be organised between India, Nepal and Bangladesh freight forwarders to discuss about inland waterways. He said, t he cou nt ries should give a joint proposal to all governments to extend the treaty, which already exists with Bangladesh, to Nepal too, especially for Jogighopa and Pandu Multimodal Logistics Parks to be opened in the north eastern India.


aersk, the world leader in integrated container logistics, has partnered with BlackBuck, India’s largest online marketplace for trucking, to provide an online marketplace for containerised trucking in EXIM logistics in India. The neutral platform will be open to the whole industry. Its aim is to reduce touchpoints in the supply chain and improve customer experience, match demand-supply through the year and provide consistency in service delivery through real-time visibility and control.

VKL Seasoning signs on DHL SmarTrucking as logistics partner


HL SmarTrucking today announced that it has partnered VKL Seasoning & Flavours, a flagship company of VKL Food Solutions Enterprise to transport their products across India. In addition to employing smart technology to ensure vehicle placement and reduction in lead time, DHL SmarTrucking leverages internet of things (IoT) technology and data-driven insights for route optimisation to shorten transit times.

Honeywell advances cyber security efforts with ISA


oneywell has joined the Global Cyber security Alliance (GCA), created by the International Society of Automation (ISA), as a founding member. The company will collaborate with GCA participants — from other technology providers and integrators to end users and government agencies — to build awareness, provide education, share best practices, and accelerate the development and adoption of cyber security standards. Honeywell’s involvement with the ISA GCA builds on decades of work, both with ISA and internally, to protect customers and technologies from on- and offline threats.








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International Track temperature and shock records through Unilode’s latest solution

U Cargo volume at Frankfurt Airport picks up slightly in July


rankfurt Airport (FRA), one of the leading European airports, has handled 178,652 metric tonnes of cargo volume in the reporting month. The cargo throughput including mail and freight registered a slight increase of 1.5 per cent year-on-year, after consecutive months of decline in volume. The airport has been recording the dip in

cargo volume since last year, due to uncertainties in global trade, particularly during the second half of the year. The airport said that aircraft movements in July 2019 climbed by 1.0 per cent to 47,125 takeoffs and landings, while accumulated maximum takeoff weights (MTOWs) expanded by 2.4 per cent to over 2.9 million metric tonnes.

Oman Air Cargo improves service with new SmartKargo mobile app


man Air Cargo has launched the mobile application SmartKargo platform for all its customers including, shippers and freight forwarders. The app was launched in collaboration with QuantumID Technologies, Oman Air's system solution provider. This Mobile App, build on the successful deployment of SmartKargo cloud-based Cargo Management solution that was launched back

in September 2017, opens a whole new Sales and Distribution channel for Oman Air Cargo business. At the same time, it empowers Shippers and Clients by providing them with selfservice and mobile capabilities (access anytime, from anywhere) for their most used requirements to interface real-time with Oman Air Cargo, including quote, flight schedules, and capacity queries, to real-time bookings and tracking notifications.

time:matters expands sameday air network in Asia


ime:matters, time-critical logistics services provider, is further expanding its presence in Asia, with the addition of three new stations in Japan, Singapore and Thailand. With the introduction of new stations to its network, the company has a total of ten Asian business centers – Tokyo (NRT), Singapore (SIN), Bangkok (BKK), Shanghai

78 CargoConnect - september 2019

(PVG), Shenyang (SHE), Beijing (PEK), Nanjing (NKG), Qingdao (TAO), Chengdu (CTU) and Guangzhou (CAN). time:matters customers now have access to 84 weekly direct flights between the European hubs in Frankfurt, Munich and Vienna and the three new destinations. time:matters is now offering transports of time-critical

shipments between the new stations and existing sameday air locations in Europe, Israel, the US and Mexico with the usual high level of reliability and precision.

nilode customers can now get access to ULD tracking data and additional information such as temperature and shock records, as it has completed an in-flight trial of its ULD tracking solution. Unilode and its ULD digitidation strategic partner, OnAsset Intelligence, tested smart-phone app which allows tracking of its Bluetooth equipped ULDs by connecting to an aircraft's commercial Wi-Fi network. The Bluetooth connection between container tag and smartphone functioning across flight decks was demonstrated by the trail flight. The flight was from Hong Kong to Zurich. Besides the geolocation, the data transmitted the flight information on temperature, humidity and light in the aircraft's belly. This allows live in-flight temperature monitoring and automated load sequencing control before take-off.

Halifax Stanfield begins construction of Air Cargo Logistics Park


alifax International Airport Authority (HIAA) has broken ground on construction of the new multi-million dollar Halifax Stanfield Air Cargo Logistics Park. The park is aimed at growing exports and trade from Nova Scotia, which include lobster and aeronautical components. The long-term target is to add storage capacity for seafood products destined for global markets. The Air Cargo Logistics Park will be built on 25 acres of vacant land at Halifax Stanfield and will include a new cargo apron area, buildings for cargo handling, an aircraft de-icing facility and associated operational areas both airside and groundside. The facility is expected to open in early 2021. The Air Cargo Logistics Park is being funded by investments of C$18 million from the federal government, $5 million from the provincial government, and $13 million from HIAA.

International DSV-Panalpina merger creates world’s second largest airfreight forwarder


SV A/S (DSV) completed the previously announced public exchange offer for all publicly held shares of Panalpina Welt-

transport (Holding) AG (Panalpina). Hence, DSV has finally acquired Panalpina in a deal worth $5.5 billion. The com-

bined company will be recognised as DSV Panalpina and the merger will result in the creation of the second-largest airfreight provider in the world. Panalpina is among the globally leading providers of supply chain solutions with approximately 14,500 employees in 70 countries. The revenue, following the completion of merger, according to DSV, is expected to be approximately DKK 118 billion. The workforce will be 60,000 employees in 90 countries.

Ethiopian Cargo starts freighter service to Bangkok and Hanoi


thiopian Cargo has started once-weekly 777 freighter service to Hanoi (HAN) and Bangkok (BKK) from its Addis Ababa (ADD) base. The weekly flight departs ADD on Fridays, arriving in HAN that evening before continuing to BKK, where it arrives Saturday mornings. From Thailand, the freighter service returns to ADD midday on Saturday. Ethiopian Cargo’s freighter fleet includes ten 777Fs and two 737-800SF, though the carrier expects to continue growing its cargo fleet. According to Ethiopian Group’s CEO Tewolde GebreMariam, “The carrier’s new service to HAN and BKK will supplement the



uehne+Nagel (K+N) have acquired Worldwide Perishable Canada (WWP), which further expands the perishable division of the business. Founded in 1999 and headquartered in Nova Scotia, Canada, WWP is a leading freight forwarder that is particularly involved in the exporting of tuna. The combined volume of both companies’ business portfolios will account for more than 17,000 tons air export of perishables per annum out of Canada, strengthening K+N’s market leading position in North America. Greg Martin, Regional Airfreight Manager at K+N North America said, “We have been continuously investing in the expansion of our dedicated network: through selected acquisitions and by connecting key production countries to major markets.”

Bolloré Logistics Singapore completes time-critical transport daily belly hold cargo capacity on passenger aircraft and will create better connectivity for cargo transport not just between Ethiopia and Thailand and Vietnam but also to over 60 destinations we serve in Africa.”

DP World revenues up 31.9pc in H1 to $3.46bn uba i- ba s e d g loba l marine terminal operator DP World has reported achieving revenue of $3.463 billion during the first half of 2019, a growth of 31.9 per cent, compared to $2.626 billion dur i ng t he same period in 2018. Acquisitions and growth in non-containerised revenue helped revenue climb to $3.46

Kuehne+Nagel expands perishables network with acquisition of WWP

billion, although on a like-forlike, constant currency basis the revenue increase was 11 percent, said the Dubai-based company. Sultan Ahmed Bin Sul aye m , DP World Gr o up Chair ma n a nd CEO said, “Our half-year financial results have been in line with our expectations.” He highlighted that DP World con-

tinues to be guided by deep market understanding, innovation and operational excellence across 45 countries worldwide. Despite uncertainty from the trade war a nd challeng i ng reg ional geopol it ica l rea l it ies, DP World has been able to deliver and excel a broadly impressive performance in the first half of 2019.


olloré Logistics Singapore undertook a time-critical air charter operation for a client from the oil and gas sector, to aid them in the replacement of damaged equipment. The team was tasked to transport subsea wellhead conductors from a fabrication plant in Batam (Indonesia) to Luanda (Angola). The operation saw transportation of two high and low pressure conductors and 15 crates of parts, which were loaded onto an Antonov-124 (AN-124) freighter of Volga-Dnepr Airlines.

september‑ 2019 - CargoConnect


EVENTS SIAM’s Auto Logistics Conclave highlighted opportunities for multi-modal transportation


ociety of Indian Automobile Ma nufact urers (SIAM), the apex body of the automobile industry, held its two-day 6th SIAM Automotive Logistics Conclave themed ‘Automotive Logistics – Need for Optimisation of Resources’ from August 1-2, 2019, at Hotel Taj Mahal, Mansingh Road, New Delhi, highlighting various opportunities for multi-modal transportation along with innovations that lie ahead for automotive log ist ics. T he conc lave brought together, vehicle manufacturers, OEMs, logis-

80 CargoConnect - september 2019

tics heads and suppliers to find solutions to optimise resources and mitigate gaps to facilitate industry growth. Eminent speakers from the Government such as the Ministry of Commerce, Ministry of Railways, Ministry of Shipping, Inland Waterways Authority of India, heads of the logistics functions of automobile manufacturers, as well as distinguished speakers from abroad from OEMs, 3PLs and logistics operators, shared their views and insights on various topics and interacted with the participants.

FICCI National Committee on Logistics held its 1st Meeting


embers of the Federation of Indian Chambers of Commerce & Industry (FICCI) participated in the first meeting of FICCI National Committee on Logistics on August 27, 2019, at FICCI Federation House in New Delhi. At the meeting, the members deliberated on how the committee should work to achieve the best results along with seeking inputs internally for drawing the ‘work pla n’ of t he commit tee, a nd addressing skills and driver shortage and significant challenges the Indian logistics industry is currently grappling with.

Member CBIC and JS Customs address FFFAI 12th EC Meeting


he Federation of Freight Forwarders’ Associations in India (FFFAI) held its 12th Executive Committee Meeting on August 23, 2019, at The Ashok Hotel, New Delhi, which was attended by all office bearers and a majority of EC members of the federation. On the occasion, FFFAI invited special guests John Joseph, Member (Tax Policy), Additional Charge-Member (IT, Legal & CV) Central Board of Indirect Taxes and Customs (CBIC) and L Satya Srinivasa, Joint Secretary (Customs), Government of India, to

address and interact on current operational issues pertaining to Customs and fast clearance of cargo across the country. At the meeting, the EC of FFFAI focussed on the ground situation and their role to resolve the issues in tandem with the government. The meeting also discussed on the forthcoming Annual General Meeting (AGM) scheduled to take place on September 27 and 28 in Chennai, where the new committee of FFFAI will be elected for the period of 2019-20 and 2020-21.

september‑ 2019 - CargoConnect


UpComingevents Logistics and Supply Chain

Air Cargo

Pharma EVENT: CPhI &

P-MEC India 2019


EVENT: AUTOCONNECT 2019 ORGANISED BY: Surecom Media DATE: September 19, 2019 WHERE: Shangri-La's Eros Hotel,

New Delhi AutoConnect is an yearly conference on the automotive logistics and supply chain industry of India. AUTOCONNECT 2019 is expected to bring together more than 200 leaders and key stakeholders from India’s auto supply chain who will deliberate on the various factors that affect India’s growing automotive logistics segment, future prospects and new avenues of automotive logistics business to propel India’s automotive supply chain to worldclass performance levels. To know more visit www.autoconnect.com

EVENT: ACAAI 45th Annual Convention ORGANISED BY: The Air Cargo Agents Association of India (ACAAI) DATE: November 21 - 24, 2019 WHERE: The Westin Siray Bay Resort & Spa, Phuket, Thailand This is the annual prestigious event for the members of ACAAI and the trade. The convention will also be attended by invited dignitaries from all segments of the freight forwarding and logistics business, government ministries and departments, airlines, airport authorities, custodians, etc. This year, the theme of the convention is ‘End-to-End Logistics - The Way Forward’. The convention will offer delegates a fabulous opportunity to engage in business sessions, networking opportunities and fellowship. To know more visit www.acaai.in

Road Transport

EVENT: 15th Annual 3PL & Supply

Chain Summit: Europe ORGANISED BY: Eye For Transport DATE: October 14 – 16, 2019 WHERE: Sheraton Brussels Airport Hotel, Brussels, Belgium European 3PL & Supply Chain Summit is an annual meeting which brings together the leading C-Level 3PL executives and their manufacturer and retailer supply chain counterparts to explore the future of supply chain and logistics. Over 450+ senior supply chain and logistics executives attend the event every year. To know more visit www.events.eft.com/eu3pl

82 CargoConnect - september 2019

Event: 26th World Road Congress Organised by: World Road

Association (PIARC)

Date: October 6 - 10, 2019 Where: Abu Dhabi, UAE

Bringing together more than 1,200 international experts, leaders in the field of transport, active in the 22 Committees of PIARC, this Congress will focus on “Connecting Cultures - Enabling Economies". The event will host 150 presentations with more than 50 workshops and sessions. To know more visit www.aipcrabudhabi2019.org

26 – 28, 2019 WHERE: India Exposition Mart, Greater Noida CPhI & P-MEC India is the ideal event for companies wanting to pick up on the latest trends and innovations the market has to offer. At CPhI & P-MEC India, you will meet the movers and shakers from India's pharma machinery, technology and ingredients industries, giving you a competitive advantage that will help grow your business. To know more visit www.cphi.com

Cold Chain EVENT: 2nd International

RAC India ExCon


Chamber of Commerce and Industry, NIRATA, and Orange Marcom Services DATE: October 17 – 19, 2019 WHERE: NSIC Grounds, Okhla, New Delhi RAC India ExCon is North India’s major exhibition of HVAC&R and Cold Chain. The exhibition is focused on the manufacturers and suppliers of Refrigeration, Air-conditioning, Cold chain and allied industries. The comfortable environment facilitates holding negotiations, meetings, signing of contracts. To know more visit www.racindiaexcon.com

EVENT: 8th India Cold Chain Show ORGANISED BY: Reed Manch Exhibitions DATE: December 04 – 06, 2019 WHERE: Bombay Exhibition Centre (BEC), Mumbai, India India Cold Chain Show brings together Indian and international manufacturers and suppliers to meet end-users, distributors, consultants and other key industry players from across the globe. The show allows visitors and exhibitors to build new and strengthen existing contacts, learn new industry trends, technologies and upgrade their products and services. To know more visit www.indiacoldchainshow.com

9 15-16-17 NOVEMBER 2019


2500 sqm of business space


150+ Exhibitors 5000+ trade buyers International Participation Business Matchmaking Platform- GoConnect



Janish Jafri M: +91 9999686007 E: janish.jafri@reedmanch.com


Product launches & Live demos

APPOINTMENTS Anuj Aggarwal appointed as interim Chairman of AAI

Anuj Aggarwal has taken over as the Chairman of Airports Authority of India (AAI) on interim basis post appointment of Dr Guruprasad Mohapatra as Secretary in Department for Promotion of Industry and Internal Trade, Ministry of Commerce. Aggarwal is an engineering graduate from BITS Pilani. He has more than 25 years of experience in the field of airport engineering, operations management and development of select airports through PPP under direct supervision of ministry of civil aviation, government of India.

GEFCO India appoints Prasanna Kumar MV as CEO & MD

GEFCO India, subsidiary of the GEFCO Group, world leader in complex supply-chain solutions and the European leader in automotive logistics, has announced the appointment of Prasanna Kumar M V as the CEO and MD of India operations, in Chennai. With over 28 years of in-depth experience in the logistics and global supply chain sectors, Kumar is an expert in managing turnkey projects and extended supply chains with experience of handling country operations in India, Thailand and Australia.

DMICDC Logistics Data Services appoints Ichiro Oshima as CEO

Delhi Mumbai Industrial Corridor Development Corporation (DMICDC) Logistics Data Services Limited (DLDS), a joint venture between GoI represented by National Industrial Corridor Development and Implementation Trust (NICDIT) and NEC Corporation, has appointed Ichiro Oshima as the new CEO with effect from April, 2019. Oshima has been associated with NEC for nearly 30 years and brings with him a rich experience in Enterprise ICT solution business, where he strategised and marketed innovative solutions in Japan and around the world.

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Mavyn onboards Atul Kawatra as Non-Exec Director

Digital trucking start-up Mavyn has appointed Atul Kawatra as its Non-Executive Director. Atul will guide Mavyn on overall company strategy, with a special focus on financing decisions, investor relations and capital allocation. With more than 16 years of experience in finance roles, Kawatra's key tasks will be to define overall business objectives, guide fund raising plans and create strategies to maximise ROI for Mavyn on long-term investment plans.

Silk Way West Airlines announces Jenny Zhao as new APAC VP

Silk Way West Airlines has appointed Jenny Zhao as its new Vice President Asia-Pacific region (APAC) effective August 1. In the new role, Zhao will be responsible for providing strategic and tactical direction for further enhancing of business operations. Zhao has more than 15 years of experience in the air cargo industry, having previously held senior management positions at various cargo airlines. For the past two years, she served as CCO, Asia Pacific region, at Silk Way West Airlines (APAC), and head of the company’s rep office in Shanghai.

Cathay Pacific appoints Mandy Ng as HK Express CEO

Cathay Pacific veteran Mandy Ng has taken over as the CEO of HK Express from former CEO Ronald Lam who has been appointed Chief Customer and Commercial Officer at the company. Mandy began her career with the Cathay Pacific Group as a Management Trainee in 1999 and has since held a variety of positions involving planning, revenue and sales in Hong Kong, Thailand and Malaysia. Before joining HK Express, Mandy was General Manager Business Development at Swire Pacific, a position she held since July 2018.

GreyOrange names Jeff Cashman as SVP and Global COO

Jeff Cashman has been appointed as Senior Vice President and Global Chief Operations officer of robotics start-up firm GreyOrange. Cashman brings more than 30 years of supply chain technology experience to GreyOrange, most recently as the CEO of Ally Commerce, an E-commerce service provider for brand manufacturers. He also spent 12 years as an executive in Accenture’s Supply Chain Strategy Practice as well as 13 years as SVP of Business Development at supply chain solution provider Manhattan Associates.

Crane Worldwide Logistics appoints Keith Winters as CEO

Crane Worldwide Logistics has appointed Keith Winters as its Chief Executive, effective immediately, taking over from John Magee, who leaves after 11 years. Winters has worked in strategic and executive leadership positions for over 20 years in the Crane family of companies. He served for 8 years as COO for Crane Worldwide, and most recently as CEO of Davaco, Inc (a company affiliated with the Crane Capital Group, Inc.).



16TH JULY, 2020

Speakers at DURABLESCONNECT 2020

N Sivasailam

Special Secretary Logistics, Ministry of Commerce & Industry, Government of India

Ashutosh Raut

VP - Supply Chain Management Anchor Electrical (Panasonic)

Yogesh Sarin

Deepak Gautam

Director- Supply Chain, South Asia Dell EMC

Innovation HeadSCM LG Electronics India

Atulesh Rastogi

General Manager - Supply Chain & Procurement (Mobile Business) Lenovo India


Ramanujam TS CEO Logistics Sector Skill Council

Ramkesh Jangra Head- Supply Chain- SCC Ericsson India Global Services

Vijay Wadhwani Mukesh Ralhan Asst VP- SCM Relaxo Footwears

Arun Kumar Ghosh

Head - Logistics & SCM Konica Minolta Business Solutions India

Manoj Chauhan

Head- SCM Strategy Head - Supply Chain & OperationsMagicon Impex Mobility & (Jivi Mobile) Enterprise, Pan India Vodafone


AJEET KUMAR: +91 9810962016 ajeet@surecommedia.com SMITI SURI: +91 9711383365 smiti@surecommedia.com RAHUL: +91 7011609817 rahul@surecommedia.com PALLAVI: +91 8700809249 pallavi.surecommedia@gmail.com AKASH: +91 8383061964 akash.surecommedia@gmail.com RAHUL JAIN: +91 9560484905 rahuljain.surecommedia@gmail.com


Managing Director, Indian subcontinent, UPS

Journey so far! My part-time job as a sorter for UPS at its Lyon centre in France was my initial step towards a career in logistics. And working my way up to management from operations was a significant learning curve - both professionally and personally. Today, when I look back at the past 20 years, it brings a feeling of pleasure to have worked across three continents, eight countries - India, France, Belgium, UAE, Bahrain, Oman, Kuwait and Qatar, and to have managed teams of 25 diverse nationalities. Although I have benefitted a lot from the international engagements, the credit for such opportunities goes completely to UPS. My professional trajectory is emblematic of what John F Kennedy once said “Every accomplishment starts with the decision to try.” The journey has been great and it’s far from over as UPS continues to focus on international growth. The biggest challenge My tenure in Belgium was the

as you know you have given your best and you are true to yourself, that’s all matters. You’ll notice that results come along more frequently when you give 110 per cent. I also believe that some of the greatest opportunities originate in places where few are willing to venture. One should be open to the journey, embrace the unknown and be ready to move quickly. Being open – having an open mind-set – is also key to successful people management. That's what keeps networks alive, expanding and functioning.

Interests and hobbies I enjoy spending quality time with my family; and like to stay fit. I am fond of cycling and manage to make time for it twice a week. Message for aspirants Take a step back and look before you leap. And if you leap into this industry, you really are jumping into the heart of the action. I want

mo s t c h a l l e n g i n g b ut a l s o gratifying. With leading a team of more than 120 employees, I was responsible for parcel sorting operations, monitoring quality of service and productivity indicators and implementing aviation security measures. I also managed customs operations and relationships with union representatives.

Values for success The definition of success is not the same for everyone. As long

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people to consider what logistics enables. If you start with that, you realise that global trade doesn’t happen without us. Imagine what this industry will look like in 20 years. So think about joining in to help steer its future. We need good leaders, hard workers and people with a world view. Lastly, perseverance is crucial. Never ever give up. Believe in yourself and find a good mentor who believes in you. And be a mentor to someone, too. Pass on what you learn. CC

Interviewed by Upamanyu Borah

Greatest opportunities originate in places where few are willing to venture

18-19 March 2020 Shanghai World Expo Exhibition & Convention Center (SWEECC) Shanghai, China

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Cargo Connect September 2019  

Cargo Connect September 2019