Logistics 5.0 Opportunity to Improve Resilience, Sustainability

DANX Carousel Group’s thought leadership white paper, ‘Logistics 5.0: Strategy Beyond Data – Turning Uncertainty into Opportunity,’ concludes that adaptability, resilience, and carbon footprint reduction are the key areas for technology investment to focus on as the supply chain industry enters the next chapter of digital transformation.

The report, which surveyed supply chain leaders, acknowledges the leap forward brought about by digital transformation from Logistics 4.0, but forewarns how Logistics 5.0 will demand a broader approach to how technology is used.

“When deciding on new technology to support your business it is important, from a technology perspective, not to be overly excited by the new shiny toys out there,” said Thomas Wad Jelle (pictured), Chief Technology and Information Officer, Danx Carousel.

“Instead, focus on the business risks and customer requirements to understand what needs to be solved and how technology can be part of that solution. There is no silver bullet for bringing your data perfectly together across companies and supply chain.”

In a note of caution, the white paper highlighted concern among those surveyed over the worrying lack of talent needed to make successful digital transformation and development possible. The report revealed that 21 percent of organisations attributed their experienced disruption to a loss or lack of talent, while 15 percent are struggling to find the right people to lead their organisation into this new era of optimisation.

“Technology is the enabler, not the solution,” said Ulrik Find, Chief Operations Officer, DANX Carousel Group, adding that tapping into the talent pool and attracting the right people to a career in the supply chain industry is essential.

Find illustrated his point by pointing to the example of organisations that had the right tech during the pandemic, but lacked the “nimble, ‘fleet of foot’ mentality” embodied by many start-ups who thrived.

When setting out his three-point roadmap to transformation, Find also emphasised the need for a ‘mindset shift’ among industry leaders, calling for them to reinvent how they attract talent, who they do business with and why, how they build their strategy, and where they allocate their capital.

“The dawn of Logistics 5.0 has very much arrived – it marks a new phase in the supply chain, one that is heading toward an increasingly digital world, but this time with the incorporation of sustainability and learnt lessons from the past,” concluded Find.

 

Biggest Mass Timber Logistics Centre

Global fashion company Bestseller and architecture studio Henning Larsen have unveiled the concept design for a new ground-breaking logistics centre to be built in the Netherlands. The centre will be the biggest of its kind in Europe made with mass timber, and the companies aim for the building to reach ambitious standards for design and sustainability.

Located in Lelystad, 60 km east of Amsterdam, the 155,000 m2 logistics centre will be built over the coming years. Logistics Centre West (LCW) as the building is known, is being built by the fashion company BESTSELLER, and it was designed by the architecture firm Henning Larsen. When completed in 2026, it is expected to be the largest logistics centre built using mass timber in Europe.

“We are happy to be able to unveil the design of our new logistics centre, for which we have very big ambitions. Not only because it strengthens our opportunities for future growth, but also because it was designed to excel in sustainable construction through, not least, the choice of mass timber in the construction. We wanted the building to demonstrate our desire for aesthetic design, and we are very proud of what we have succeeded in jointly with Henning Larsen,” said Allan Kyhe Kjærgaard, Logistics Director at BESTSELLER.

In addition to the striking mass timber construction, the building will also be equipped with 23,000 square meters of solar panels.

Aesthetics and excellence

An important part of the design process was creating a workplace that is both visually appealing and healthy for the almost 600 colleagues who are expected to be work at the centre. The team from Henning Larsen has, among other things, prioritised daylight and green areas as well as harmonising indoor and outdoor elements to promote employee well-being.

“The design of Logistics Centre West represents a fundamental change to the way we imagine how a logistics centre should look. It’s a result of a united client and consultancy team committed to creating a design that is visually stunning, carbon efficient and has a positive biodiverse impact,” says Eva Ravnborg, Country Market Director, Partner, Henning Larsen.

Promoting biodiversity

More than half of the total site is dedicated to its landscape. The majority of the area will thus be dedicated to wetlands and forest to protect biodiversity and help absorb CO2.

In order to preserve and protect the area’s animal and plant life, the construction will be surrounded by a constructed wetland, which will contribute to promoting microhabitats for native species. The centre will also have an optimised rainwater system that, among other things, protects against flooding and recycles rainwater from the roof.

“We are very aware that constructing new buildings affects the environment, the climate and the local community. Therefore, a very thorough process has taken place before we can now present the plans for our new logistics centre. There have been many ambitions which had to be united in one building, but we believe that we have succeeded – not least thanks to a good and close collaboration with Henning Larsen. We look forward to putting the logistics centre into use in 2026, says Allan Kyhe Kjærgaard.

 

Forced Labour Implications in Global Supply Chain

The battle against forced labour in global supply chains has gained momentum in recent times, not least thanks to coverage of the dramatic situation of the Uyghur population in the province of Xinjiang in China and the legislative proposals which have emerged in reaction, writes Thomas Lobert (pictured), Solutions Consultant Global Trade Intelligence at Descartes.

In the United States, the Uyghur Forced Labor Prevention Act (UFLPA) has, for example, prohibited the import of goods manufactured in whole or in part by forced labour and originating from the autonomous region of Uyghur since June 21, 2022. At the European level, a much-debated bill will be voted on by MEPs with implementation expected at the start of 2024. In Germany the law on corporate responsibility in the supply chain came into force on January 1, 2023. Similar laws are in force or in preparation in other countries in Europe.

Meanwhile, in the UK, what are the implications of forced labour in the management of international supply chains? And what can businesses do to create more ethical and responsible supply chains in this regard?

1. Forced labour: reinforcement of UK regulation
Forced labour is considered a serious crime in the UK. In 2009, a standalone offence of holding a person in slavery, servitude or forced labour was included in section 71 of the Coroners and Justice Act, while a House of Lords private members bill was proposed in July 2021, that would have seen significant amendments to the Modern Slavery Act 2015 (MSA), significantly increasing accountability for abuses occurring in the supply chain of UK multinational corporations. Unfortunately, little seems to have happened since those amendments were tabled, and meanwhile, the UK’s risk rating for critical violations has increased, according to the Supply Chain ESG Risk Ratings Report 2023.

Despite this lack of regulatory enforcement, UK businesses cannot afford to maintain a ‘laissez-faire’ attitude to forced labour within their supply chains. According to research from Deloitte, amongst the changes consumers are making in their purchasing decisions, sustainable and ethical practices are becoming more important, with consumers actively choosing brands with ethical practices / values ; ceasing to purchase certain brands or products because of ethical concerns ; and even contacting brands to raise an issue regarding sustainability or ethics.

2. Identifying forced labour: a complete ecosystem
Forced labour refers to situations where workers are forced or threatened in any way to work against their will, often in inhumane and abusive conditions. This can happen at any time in the supply chain: from sourcing raw materials to manufacturing products, including distribution. It is a serious violation of human rights and a form of modern slavery that affects millions of people around the world.

This concern is not limited to the practices of a company alone, but extends to its suppliers and external service providers. The entire chain must be able to be audited. We must be vigilant about working conditions and the location of the company and its suppliers. For a Chinese supplier, for example, is the production plant close to a Uyghur forced labour camp?

As global supply chains are infinitely complex and constantly in motion, establishing long-term, reliable risk monitoring and visibility is challenging. Additionally, government agencies do not publish lists of companies suspected of using forced labour, further complicating background checks on potential suppliers.

3. Take action NOW
Despite its perceived complexity, there are actions and practices businesses can put in place to bolster the fight against the use of forced labour within their supply chains:-
· Identify risks: be alert to the circumstances that may encourage the use of forced labour
· Diversify sources of information to understand working conditions within your supply chain (talk with your suppliers’ employees, examine your internal policies in detail, collaborate with NGOs, etc.)
· Always be aware of the laws in force on slavery and forced labour
· Review and implement internal compliance plans (ICP): the control measures required to monitor the compliance of exports and international trade are increasingly taken into account.

Thorough monitoring is essential in the fight against forced labour. Analysis firms like Kharon have developed their own research methods and their network of international experts to identify companies at risk, particularly with regard to forced labour. This information can then be implemented into a due diligence solution to continuously analyse all third parties in the supply chains.

Conclusion

Today, based on a list of 50 entities sanctioned by a government, it is possible to identify more than 8,600 companies associated with these 50 entities. Every company in the world should be able to guarantee that their supply chain is free of forced labour. This includes identifying at-risk suppliers, promoting fairer supply chains and implementing solutions to ensure all suppliers meet these working standards. Not taking action is no longer no option.

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