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Tag: supply chain

GoRamp secures CEE award

Posted on by Keith McKinley

Logistics technology start-up GoRamp has been selected as the best solution for the management of logistics and supply chain in Central and Eastern Europe.

CEE Logistics & Supply Chain Management Excellence Awards organised under the auspices of Translog Connect has selected a transportation process optimisation tool developed by the Lithuanian start-up GoRamp as the best logistics Service Provider of the year. The award is annually conferred upon an innovative service that proves its effectiveness in the optimisation of customer supply chain, ensuring saving of costs and resources as well as sustainable business development.

“This award is an important recognition for us and the entire logistic technology developers’ community in the Baltics,” said Jevgenij Polonis, CEO and co-founder of GoRamp. “Our contribution to the development of supply chain innovation in Central and Eastern Europe is taken into account and appreciated. That is a strong step forward towards the GoRamp vision to digitise the logistics processes of manufacturing and trading companies, which are currently based on unadvanced and inefficient manual work and outdated methods.”

GoRamp subscription model

GoRamp has developed a tool based on a monthly subscription for logistics units of manufacturing and trading companies. The companies may choose the solutions based on their supply chain processes and challenges. The modules include planning of warehouse arrivals, management of carrier contracts, automated inspection of invoices, and integration of the different systems. According to the feedback received from customers from 19 countries, the system allows for saving up to 70% of operational work, cut waiting time by 20%, avoid downtime and fit the agreed budget.

For the awards, GoRamp presented a success story of Schoeller Allibert, one of the largest global plastic recycling companies, that operates in 50 countries. Installation of the GoRamp system resulted in warehouse effectiveness. Schoeller Allibert managed to increase the efficiency of warehouse operations by more than a third, reduce the queues of trucks by 90%, and cut the waiting time of drivers by 40%.

Translog Connect is an annual international congress of the supply chain industry aimed at discussing the progress of transport, logistics and supply chain management in Central and Eastern Europe. The summit attracts over 400 participants from more than 17 countries.

www.goramp.eu

Supply chain challenges in the luxury goods market

Posted on by Keith McKinley

Following the pandemic-related slump in 2020, the luxury goods industry has regained its former strength. The global market for personal luxury goods, which includes luxury fashion, decorative luxury items such as jewellery, watches and writing instruments, and beauty items, reached a value of €310bn this year and all indications are for further growth. According to current estimates, the market will grow to €480bn by 2030.

Increasing customer demand and current global uncertainties have made supply chain management a strategic core function, which poses major challenges for luxury brands. This is one of the conclusions from the recent study “Personal luxury: Supply Chain challenges & how to prepare for the future”, developed by Arvato Supply Chain Solutions in cooperation with the international strategy consultancy Roland Berger.

“The market for personal luxury goods offers significant opportunities for growth,” explains Julia Boers, President of Consumer Products at Arvato Supply Chain Solutions. “We commissioned Roland Berger to conduct a study to learn more about current and future developments and obtain detailed information about the market in which we already serve clients.”

The strategy consulting experts analysed the European and American luxury markets intensively. “Important industry experts from different areas were also interviewed, individually speaking to current market developments and their effects on supply chain management,” says Dr. Richard Federowski, Partner Consumer Goods and Retail at Roland Berger.

Four key trends were identified that will have massive impacts on the market for personal luxury goods until 2030. One of them is the emergence of a younger buyer group who holds higher expectations from luxury brands – they not only expect a unique and consistent customer experience through all touchpoints, but also react very sensitively to issues surrounding sustainability. There is also a revelation that selling standardised products worldwide will no longer suffice; local product collections will be expected. This will lead to greater complexity in products.

In addition to stationary trade, omnichannel commerce – the combination of online and offline channels – has become an important growth engine for luxury brands. Buyers demand seamless interactions between the channels coupled with the ability to contact the brand directly online. With the move to increased online sales, expectations for short delivery times and highly flexible shipping options are also increasing.

The fourth emerging factor is new market uncertainties which luxury brands must navigate. Geopolitical and pandemic crises have already led to instabilities in the business environment, and these have had a strong impact on sales processes in various regions or have put a strain on existing logistical processes.

Turning challenges into opportunities

“These complex and multidimensional developments pose major challenges for luxury brands and retailers,” explains Abbas Tolouee, who worked on the study as a senior consultant at Arvato Supply Chain Solutions. “We have identified four critical points that companies must turn into factors of success in order to remain competitive in the long term.”

Luxury brands and retailers face the challenge of offering a luxurious customer experience embodying the brand’s DNA across increasing numbers of sales channels – from initial customer contact, through order placement and including after-sales service. They must have control over all customer touchpoints within the supply chain, which is only possible when there is end-to-end integration of all IT systems and corresponding interfaces. Particularly an online shop must have real-time product availability, provide order status information, and offer several shipping options.

Additionally, speed and punctuality in last mile delivery are essential. The second challenge is inventory management across different regions and channels. To accomplish this, luxury brands and retailers must synchronise all data in real time and invest in intelligent inventory optimisation technologies and forecasting tools to anticipate demand, plan supply and detect fraud.

To get a handle on rising operating costs, luxury goods manufacturers should increase their operational efficiencies through automation and digitalisation. Warehouse services solutions should include a cloud-based IT infrastructure with fully integrated and automated supply chain processes that ensure high operational efficiency. This also ensures that errors and product losses are minimised, and inventory control is optimised. Transparency surrounding the CO2 footprint is also extremely important, especially for the younger target group. It is not enough to know the origin of the product and to measure its impact on the environment. Companies must monitor sustainability throughout the entire supply chain and define a company-wide framework to meet the expectations of their customers.

“This is where partnerships with experienced logistics service providers such as Arvato Supply Chain Solutions offer an advantage,” explains Tolouee. “We not only support our clients in developing holistic sustainability concepts for transport, packaging and storage optimisation, but we also offer a number of practical solutions which we have already developed to assist our clients in mastering these challenges.” Those solutions also form part of the study, and selected examples are reviewed in depth.

CLICK HERE to read the complete study: “Personal luxury: Supply Chain challenges & how to prepare for the future”.

Three 2023 transportation trends

Posted on by Keith McKinley

Anyone who works in the transportation industry knows that supply chains have never exactly been ‘normal’, writes Stephan Sieber (pictured), CEO of Transporeon. However, any semblance of normality or regularity that they did possess flew out of the window in 2022. From the war in Ukraine to petrol and driver shortages and rising inflation, transportation networks have remained under pressure.

This has all seen supply chains enter mainstream consciousness like never before. They have dominated global news cycles, while elevating supply chain leadership to the C-suite and boardroom.

The big question for transportation professionals as we head into the new year is what does 2023 have in store? Although it’s hard to know for sure, here are three trends that are likely to shape the supply chain industry over the next 12 months.

1. From resilience to optionality

The need for supply chain resilience has become a common theme within the industry. Building resilience into their operations, either through new business strategies or new digital capabilities, is now a key priority for all shippers, carriers and logistics service providers.

However, this will go a step further in 2023. The focus will be on creating optionality so that companies have the flexibility and freedom to choose alternative strategies before they are forced to change and recover. One example is multi-shoring. With the geopolitical situation remaining tense and unpredictable and costs rapidly rising in some formerly ‘low cost’ regions such as Asia, it is getting harder for many Western businesses to justify a single sourcing strategy. As such, many of them will gradually look to build capacities and alternatives in Europe or the Americas to secure revenue streams.

Creating this optionality will require deep real-time insights into markets and processes, along with interoperability between business partners and their digital systems. Ultimately, it comes down to adopting technology that has been proven effective. For example, 57% of carriers are now leveraging freight exchange platforms to find additional capacity when their own network reaches exhaustion. By embracing digital platforms and industry networks, supply chain stakeholders will be better placed to shape their own destiny – even when faced with the various external factors that are likely to cause further disruption.

2. Collaboration takes centre stage

For many years, true cross-business collaboration has been a much preached but rarely practiced exercise within transportation. But, as we look to the new year, collaboration will no longer be optional. It’ll be essential to more effectively addressing the challenges facing businesses – a notion that 71% of supply chain stakeholders ‘strongly agree’ with.

There’s certainly room for improvement. Just 17% of supply chains stakeholders rate their level of collaboration with 3PLs and carriers as ‘very high’ – with barriers such as poorly integrated IT systems, misaligned metrics and a lack of data sharing topping the list.

But collaboration is what will enable businesses to bridge the gaps that exist between shippers, carriers, logistics service providers. The gaps that hold many of the industry’s biggest challenges and opportunities. Enhanced collaboration through data sharing, for example, can empower supply chain stakeholders to reduce empty miles, increase cost efficiency and make more intelligent strategic decisions. Similarly, leveraging neutral platforms can connect companies at different stages of the supply chain to help ensure that everyone is pulling in the same direction.

Rather than just focusing on the digital aspect, this will require a hybrid approach that brings technology and humans together. As McKinsey explains, looking at digital through a human lens can help businesses enable greater trust, better communication and enhanced collaboration – representing the largest untapped and overlooked source of value in modern supply chains. That’s why, over the next 12 months, more transportation companies will make collaboration a key priority.

3. Environment vs economics

One positive we can take away from 2022 is that it has been a positive year for supply chain sustainability. Progress has been made on the road to decarbonisation, with 59% of carriers and 54% of shippers now able to calculate transport-related CO2 emissions (up from 45% and 37% respectively in 2021). However, despite the recent attention and investment, the market can’t ignore the current financial situation. With inflation at its highest level in decades and a recession looming, we have to expect that some environmental initiatives unfortunately will slow down.

But financial performance and sustainability shouldn’t be pitted against each other. It doesn’t have to be either/or. That’s why the most forward-looking companies will continue to lean into sustainability initiatives, albeit with a slightly different mindset. The question will become, how can we best combine our environmental aspirations with an economical target?

This is where data comes into play. Only by leveraging data generated across their entire operation – enhanced by the insights gleaned from cross-industry networks – will businesses be able to reduce waste and execute more efficiently. The visionaries in the industry will recognise this and start thinking about their sustainability investments through a long-term lens to ensure that the pilots of today become the programmes of tomorrow.

Ultimately, 2022 has shined a light on the structural inefficiencies that still exist within global supply chains. From fluctuating prices to cost pressures and the realisation that there’s no digital silver bullet, it has clearly been a challenging time. But there are opportunities on the horizon. For 2023, transportation leaders will just have to ensure that they build the right relationships and solutions to help them tackle whatever comes their way.

Inventory crisis: stock held by UK firms doubles

Posted on by Keith McKinley

New industry data reveals that manufacturers are holding double the amount of stock compared to pre-pandemic levels as the world’s supply chain woes take on a new form. Unleashed’s Manufacturers Health Check report used data from its inventory management software to track how SMEs in the UK have fared in 2022. The report shows businesses forced to stockpile huge quantities of goods as they navigate delays and shortages, against a background of rising inflation.

The analysis of more than 4,500 SMEs paints a picture of manufacturer health by examining four main data points: the value of stock on hand, Gross Margin Return on Inventory (GMROI), fulfilment days, and the price paid for goods purchased.

Overall,  stock on hand levels for manufacturers in the UK jumped by 99.7%, from an average of £365,736 in Q3 2019 to £730,681 in Q3 2022, while GMROI dropped from 2 to 0.9 in the same period, and fulfilment times fell from 20 days to around two weeks.

Tough inventory situation

Meanwhile manufacturers are paying 10.24% more for their goods now compared to the start of 2022.

“What started as a supply chain crisis appears to have evolved into an inventory crisis at the individual business level,” says Gareth Berry, CEO of Unleashed. “Yes we’ve seen shipping times and prices ease, but that’s at the expense of firms who are forced to hold far more stock just to stay operational.

“It’s a tough situation for manufacturers that will present real cash flow pressures. Managing those stock levels down in the coming months will be a delicate task.”

Crazy lead times

Noah Warren, CEO of UK bicycle manufacturer Temple Cycles, says the impact on his business has been considerable: “One of the biggest problems we’ve had is lead times going exponentially crazy. So we’ve had to move away from a just in time stock model to just in case. The only way we could be in stock is to invest more money in it. But you can’t do that indefinitely.”

Digging deeper, it’s clear that there is variation across industries, with some industries faring better (and worse) for each data point featured in the research.

The highest percentage change in the average value of stock on hand between Q3 2019 and Q3 this year was the plastics and rubber sector – which saw an average increase of 180%. This was followed by energy and chemicals (up 174%), and the sports and entertainment sector which recorded an average increase of 123%.

In fact, all industries featured in this research were holding an increased value of stock this year compared to 2019, with the exception of manufacturers in the building and construction sector.

Decline in GMROI

When looking at GMROI, it’s clear that firms are feeling the impact of holding more stock, with the majority of firms seeing a drop in overall profitability when looking at this metric specifically.

Apart from the food sector, which lifted GMROI 93.69%, all sectors in the UK saw a decline in overall GMROI with clothing firms (down 81.8%), plastic and rubber products (down 81%) and energy and chemicals (down 62%) seeing the biggest declines.

Six of the nine industries featured in this research have been successful in cutting lead times over the past three years, with energy and chemicals (down 74.1%), automotive (down 65.6%) and food (down 48.6%).

But there are still sectors struggling to pull fulfilment times back to pre-pandemic levels, most notably the plastic and rubber products sector where the average fulfilment days are up more than double – to 29.3 days (up 266.8%).

Supply and demand instability

Daniel Myers, Director at Plastock, a material solution provider to retail and display markets, adds: “We have witnessed first-hand the significant supply and demand instability of materials, going from peaks of very stable supply to huge surges in demand and this is having a significant impact on costs.

“Price increases as much as 45% presented us with fairly significant issues, and then with the cost of those materials increasing week by week people started panic buying any available stock. So it makes it really difficult to manage stock – it’s unprecedented.”

CLICK HERE to read the full research.

www.unleashedsoftware.com

Digital twinning is key to supply chain transformation

Posted on by David Priestman

Digital twins are becoming big business, says Toby Mills, CEO of Entopy. But there is still a lot of confusion about what they are, what they do – and why they matter.

A digital twin is a virtual representation of an object or system that spans its lifecycle, is updated from real-time data, and uses simulation, machine learning and reasoning to help decision-making. It acts as a bridge between the physical and digital worlds. Businesses use digital twins in a variety of ways – from product development to operational performance improvements. Increased digitisation is making it easier to build accurate digital twins and drive adoption of the technology.

For the logistics industry, digital twins open the door to a new way of keeping track of goods moving between different organisations and physical locations. Data from multiple supply chain systems can be captured and combined to create a ‘digital twin’ of a consignment – providing a single data product from which all stakeholders can get the visibility they need.

This novel approach has been made possible by the latest ‘data mesh’ technology, based on distributed architecture for analytical data management. It enables end users to easily access and query data where it lives – without first transporting it to a data lake or data warehouse. Leveraging data across the supply chain enables a much fuller picture to be achieved at a granular level. And using data from existing systems used in the day-to-day running of the organisations involved means the data is of high quality, can be trusted and the systems are well maintained.

The digital twin concept is central to the work of supply chain visibility pioneer Entopy – providing the backbone for the company’s unique intelligent data orchestration technology, which is the secret of success for the supply chain. Just like in a traditional orchestra, a ‘conductor’ takes centre stage and synchronises all the various data inputs. Each separate system communicates directly and only to the conductor platform – removing the need for numerous discrete connections and maintaining data integrity.

As each digital twin is created, proprietary algorithms define and assign policies to it to ensure only relevant data is captured from each connected system. Data from order management and transport management systems is combined with more real-time data sources from other systems present across the supply chain. For example, consignment and inventory data can be combined with transport schedules and allocated transport.

Digital twinning

The telematics system of the associated transport vehicle provides real-time location and condition data from the consignment which, when combined with analytics, generates detailed consignment lifecycle records, capturing key events throughout. These events can be communicated across the supply chain, improving communication and paving the way to automation of processes.

Research suggests that businesses with optimal supply chains can halve their inventory holdings, reduce their supply chain costs by 15% and triple the speed of their cash-to-cash cycle. Yet the increasing complexity of supply chains is making optimisation more challenging than ever, while the cost of inefficiencies is growing. Digital twins and intelligent data orchestration are now providing a new route to unlock supply chain value and deliver competitive advantage.

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Industry View: The Age of the Digital Twin

 

AI essential to supply chain transformation

Posted on by Keith McKinley

In our connected and digital world, using artificial intelligence (AI) across the supply chain enables companies to maximise productivity by reducing uncertainties. It also helps to speed up decision-making, reduce cycle times and contribute to continuous improvement. By increasing the expectations of improved efficiencies between suppliers and customers it highlights the need to use the capabilities of AI wherever possible across the entire supply chain.

The use of AI is helping to deliver some of the most powerful optimisations required for accurate capacity planning, improved productivity, higher quality and lower costs – all whilst creating safer working conditions. The COVID-19 pandemic had a devastating impact on companies and showed just what effect global events can have on the supply chain, highlighting that companies need to invest more and plan more effectively to deal with any future uncertainties.

Here, Jean-Baptiste Clouard, CEO at Flowlity, innovative AI-based supply chain planning and forecasting solution, highlights the benefits for businesses using AI, as well as the challenges businesses face, and why ultimately, it is essential to transform the future of supply chains.

Four benefits of using AI in supply chains

1. Accurate Inventory Planning

When companies can manage and plan their inventory, it can ensure accurate flow of items in and out of a warehouse. Supply chain management considers the different variables such as order processing, and the time taken to pick and pack any orders – which can be time-consuming. Inventory planning will prevent any overstocking or unexpected stock-outs.

2: A more efficient warehouse

An efficient warehouse is integral to the supply chain, as it supports a smooth product journey from component parts to the warehouse and all the way to the customer. By using an AI system, it can solve issues quickly and accurately while simplifying the processes and speeding up the work. It will save time by freeing up capacity in the warehouse which can in turn allow staff to better use the time to upskill.

3: Reduce operational costs

The reduction of operational costs is one of the best benefits from using AI in the supply chain for many companies. Automated intelligence operations offer longer periods of error-free time by reducing workplace errors, and incidents.

4: On-time delivery

AI systems can reduce any dependency on manual inputs and make delivery times faster, safer, and smarter. Smarter systems can help facilitate timely deliveries to customers and automation will support traditional warehouse systems to remove any potential bottlenecks.

Variety of challenges

As with all new systems and processes, the introduction of a new way of working can present a variety of challenges across many different areas of the business. But by understanding the challenges that might be faced, supply chain leaders can address them.

Most AI and cloud-based systems like Flowlity are very scalable – meaning that no matter how much a business grows, supply chain executives always have the systems to support it. What is worth knowing at the start of the process is how it can be difficult to assess the initial number of users and systems that might be needed across a business to make any new investments have an impact and be effective. Before supply chain managers start looking for a new system, it is important to realise that all systems are unique, and requirements must be discussed to ensure the right one is chosen.

Whether it be the costs of training, or the operational costs involved, with any new system, there is a requirement for investment – both in terms of time and money. Good supply chain business partners will have a thorough onboarding process, and a rigorous training program to ensure everyone is aware of what they need to do. AI systems are usually cloud-based and can require a lot of processing power and bandwidth. Specialised hardware may also be required, and it takes time to gather data and build working algorithms. But initial investments must be offset by potential long-term savings.

Investments in smart technology and the use of AI, can capture huge amounts of data that was previously disaggregated. Supply chain managers need to be able to cut through the sheer volume of real time data that is available, make decisions and be able to identify where any potential bottlenecks occur.

Recent studies have suggested that artificial intelligence (AI) can deliver value throughout the supply chain and logistics operations. Everything from reducing operational redundancies, risk mitigation and cost savings, to enhancing forecasting and reducing the time for delivery through a more optimised route, AI in the supply chain is preferred by manufacturers and retailers across Europe and the UK.

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Supply Chain Optimisation Key to Retail

 

The lone warrior becomes lonely

Posted on by David Priestman

Until now, the use of open-source software has not played a major role in improving logistics processes. But that is changing. Ralf Duester, board member and SCM expert at Setlog, explains why IT service providers who jump on the bandwagon will be more successful than their competitors in the future.

It’s hard to believe that in the 21st century, the age of digitisation, you can still find medical facilities asking their colleagues or patients to send them a fax with the necessary information. However, the device first introduced by Xerox in 1966 does not only continue to play a role in the private everyday life. In logistics, as well, the “communication dinosaur” still spits out printed paper in some offices.

Admittedly, for most logistics companies, other systems have long replaced the fax. But the crux in supply chain management is still there. Each player usually works with his own system. Brands and retailer use their ERP systems, forwarders use proven transport management systems (TMS), logistics companies operate warehouse management systems (WMS), and the suppliers often stick to their Excel spreadsheets.

In everyday logistics, this means that data runs via Excel lists and e-mails – and when there is a problem, some people like to pick up the phone to find a solution. Recently, a few smart start-ups disrupted the logistics sector; they became the digital forwarding companies. With their platforms, they inserted themselves between the involved players and pushed the digitisation and automation of processes. With success. Data and good flows work better now in every aspect. The right use and control of good data is becoming the new recipe for success in transport and logistics.

This also applies to sourcing, buying and supply chain management. But even with the best data quality you are ill-advised if it lies dormant in spreadsheets or must be transferred manually between partners by email. One solution to these challenges is a modern SCM software. With OSCA (short for “Online Supply Chain Accelerator”), for example, Setlog enables the digital management of the supply chain in a cloud-based tool.

Providing customised extensions, all partners involved in the respective supply chain are integrated. More than 150 brands from the apparel, electronics, food, consumer goods and hardware sectors in more than 90 countries use the solution. It makes the supply chain transparent for everyone – for example, delivery delays and new deadlines can be communicated to all players in real time. Collaborative communication runs via a single tool.

What works easily with the help of a dashboard in terms of overviews and early warning functions such as “to do” messages, requires an intensive preparation. In the past, the integration of partners on platforms was costly due to the increased complexity in logistics, and the effort for the connection via interfaces. Setlog has often developed customised solutions for processes and data flows – which required a lot of time and money depending on the requirements. But the IT world is changing.

Customers want simple integrations to speed up data flows and coordination processes. The key to this is called open source. For the development of supply chain platforms on which all partners around the globe can work together, a quick and easy integration by API (API, short for Application Programming Interfaces) via open source, i.e. open source standard interfaces, is only advantageous.

When the keyword open source software is mentioned, some people in logistics are still surprised. Until now, it has hardly played a role in the optimisation of logistical processes. But that is changing right now. The experts’ belief is that IT service providers in logistics who use open source are successful more quickly. Yes, open source is even proving to be a sales support. Because many customers are now able to assess the added value. Especially when it comes to interfaces, open source can help the community not only to become faster and more efficient, but also to create standards. This means that no longer does everyone develop standards by themselves, but several providers fall back on the same basics – of course in compliance with all rules and regulations. This is a great lever for all partners involved in a platform.

Setlog recognised the advantages of this new IT world early on. The company is a founding member of Open Logistics e. V., the supporting association of the Open Logistics Foundation. It relies on the use of open source components for services in the platform economy of tomorrow, the Silicon Economy. According to Prof. Dr. Dr. h. c. Michael ten Hompel, head of the Fraunhofer Institute for Material Flow and Logistics IML and co-initiator of the Open Logistics Foundation, standardised interfaces are not a sanctuary for anyone in logistics – neither for shippers and forwarders nor for IT service providers. Because the intelligence still lies in the software itself. The foundation has set itself the goal of supporting logistics on its path to standardisation – very specifically in the area of interfaces.

When it comes to data exchange, some logistics experts still raise their fingers in warning and point out that companies must not allow themselves to be deprived of data sovereignty and that security must be guaranteed during transfer. They often lack knowledge about the solutions to these challenges. But it is also a fact that trust in IT systems has increased significantly in recent years. Today, sensitive information is entrusted to platforms – not only bits & bytes about transports, but also, for example, sensitive IP such as technical sketches and samples of new releases. Each of the players must be able to rely on the processes being secure. As a founding member of the International Data Spaces Association IDSA, Setlog is also open to open source solutions that affect the infrastructure.

In conclusion, those who work in silos in logistics, compartmentalise systems and accept media disruptions will sooner or later lose touch. Collaboration is key to access the new logistics world. Open source software, especially standardised interfaces, can help IT service providers in logistics – especially medium-sized companies – to improve their own solutions. The lone warriors will become lonely.

Open Source

The term open source is used to describe software whose source code is public and can be viewed, modified and used by third parties. Open-source software can usually be used free of charge.

Individuals often make a software to an open-source software out of altruistic motives. Companies and organisations usually have other intentions for doing so: they want to save costs in development and increase market share. Users who are empowered to do so can adapt the software to their own challenges and needs. It is also possible to publish a fork. So-called pull requests contribute to the continuous improvement of the software.

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Setlog and Rhenus Join Forces

 

Pressures remain despite material price drop

Posted on by David Priestman

Supply chains across Europe have been warned that remaining high prices of inputs other than raw materials are expected to keep costs of essential products such as pallets and packaging high for the foreseeable future.

According to some European industry indices, the costs of raw materials used to make packaging – pallet wood and steel (for nails) – fell during Q3/2022. However, the high cost of energy and fuel are pushing upward rates for logistics, and for heat treating and kiln drying timber. Meanwhile, other higher-priced inputs, including labour, are now making up a considerably larger proportion of the price of goods such as pallets and packaging than they were previously. This has pushed the actual price of these items up significantly.

According to the European Road Freight Rates Benchmark Report, produced by Transport Intelligence, Upply and IRU, in Q3/2022, average European road freight contract prices reached an all-time high in (129.7 index points), a rise of 5.4 points on quarter 2 and 19.6 points on the same period last year. In the spot market, rates grew to 142.6 points, an increase of 6.0 points on the previous quarter and 26.4 points year-on-year.

The report added that the cost of diesel usually accounts for one third of total operating transport costs – but may now account for 50% of costs.

Market and consumer data company Statista says the average monthly OPEC basket crude oil price rose from US$85.41 in January 2022 to $117.72 in June. Meanwhile, European Union agency Eurostat said that hourly labour costs rose by 4.0% in the euro area in the second quarter of the year and 4.4% compared with the same quarter the previous year.

Increased costs of inputs such as these are impacting on manufacturing businesses of all kinds around Europe, including the pallet and packaging sector.

Fons Ceelaert, Secretary General of the European Federation of Wooden Pallet and Packaging Manufacturers (FEFPEB), said: “Having reached all-time highs, raw material costs have eased slightly in recent months. However, national associations across Europe are reporting that ongoing highs in the cost of energy, transport and labour are still impacting heavily on the prices paid by manufacturers and repairers.

Material price drop

“Pallet and packaging businesses across Europe are working closely with their customers to minimise the impact of these continuing pressures. In the meantime, FEFPEB will continue to monitor this situation and keep the market informed about the latest developments.”

FEFPEB’s recent congress for members held in Florence, Italy, at the end of September, addressed the current challenges facing the sector. The event, titled ‘Wooden Pallets and Packaging in the Centre of the Sustainable Economy’, featured presentations and discussion on current crises, including tackling energy and shipping costs, building on the industry’s strong environmental credentials, and how to recruit and retain talented staff into the future.

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UK Exporters Warned They “Face New Year’s Day Nightmare”

 

HHLA Sky receives cybersecurity certification for drones

Posted on by Keith McKinley

HHLA Sky‘s drone system has been certified by the German technical inspection agency TÜV in accordance with the IEC 62443 cybersecurity industry standard. The entire system was tested, including communication between the drones and the Integrated Control Center. The Integrated Control Center is a scalable IoT platform that enables the active, intelligent and simultaneous monitoring and management of more than 100 automated drones, autonomous mobile robots (AMR) and their tasks.

TÜV NORD certifies the excellence and well-protected system integrity of this mobile robot management solution. Both the system architecture and the multi-layered security design, its defined procedures, the software and drone hardware meet all the requirements for this cybersecurity standard.

HHLA Sky’s product development process also meets all normative requirements in each of the eight areas. These are: managing development, defining security requirements, designing security solutions, providing a secure development environment, testing security features, dealing with security vulnerabilities, creating and publishing updates, and documenting security features.

This is the first time that an industry-standard IoT drone system has been cybersecurity-certified.

“Our customers often operate in critical infrastructures. An IoT strategy that embeds security and cybersecurity from the outset is just as important to them as the efficiency gains from using automated drones. Our customers will only deploy an adequately cybersecure product that supports their business continuity – and we must ensure that the level of protection remains permanently high. We are proud that TÜV Nord has now certified the standards we have established for our Integrated Control Center as cybersecure,” says Matthias Gronstedt, Managing Director at HHLA Sky.

“Our requirements for a cybersecure product go somewhat beyond the actual requirements for certification,” adds Lothar Müller, Managing Director at HHLA Sky: “We also see cybersecurity as a management task and therefore have a holistic approach to our own security strategy. For example, we foster a corporate culture in which it is clear to all team members that cybersecurity touches on the responsibility of each individual. This, too, enables us to design enormously resilient cyber-physical systems such as the Integrated Control Center, to provide our customers with the highest level of security.”

Real risk

“Cybercrime will cost the world $8tr in 2023,” predicts Cybercrime Magazine. “If it were measured as a country, then cybercrime would be the world’s third-largest economy after the US and China.” The magazine expects “global cybercrime damage costs to grow by 15% per year over the next three years, reaching $10.5tr annually by 2025, up from $3tr in 2015.”

According to Bitkom, the damage to German companies last year due to cyber attacks amounts to around €223bn. According to the Federal Criminal Police Office (BKA), there were 12% more cyberattacks in Germany in 2021 than in the previous year, with a total of around 146,000 attacks reported.

On a global scale, Moody’s registers that risks are rising for many sectors, while at the same time remedial and defensive measures are gaining in importance.

In a global study, the rating agency Moody’s classifies critical infrastructures such as energy, gas and water as sectors with very high cyber risk. The agency also includes the technology industry among the high-risk sectors.

Mobile Robot Management systems for drones heighten the possibility of attack due to their complexity and interconnectivity. Intelligent firewalls must therefore be raised to meet the increasing degree of automation in drone operations and the deeper the mobile robots are networked with the production systems.

Secure UAV operation

Cybersecurity is also one of the decisive factors for the safe operation of automated UAVs and, in the future, autonomously flying UAVs: for example, during missions in critical infrastructures, generally in urban areas and in all airspaces that drones share with manned aviation.

High protection against hijacking, manipulation, data theft

HHLA Sky’s drone system is cybersecure protected. Even the transmission of often sensitive sensor data is encrypted end-to-end. Access is only granted to authorised persons. Human errors, which offer additional areas of attack, are ruled out as far as possible by standard operating procedures, such as those used in civil aviation.

As a result, the system provides companies and authorities with the highest level of protection against mobile robot hijacking, the manipulation of routes and clearances, as well as against the interception or manipulation of video streams, other sensor data or the activation of functional elements on a logistics drone, such as enabling the cable winch or the opening the holding device for transport goods.

Milestone for the drone industry

HHLA Sky‘s rigorous architectural approach was fully validated by the reputable TÜV NORD and put to the test by proven experts. HHLA Sky has achieved a globally unique milestone for the UAV industry with the first cybersecurity certification for drone standards, making it a pioneer in its field.

InstaFreight appoints ex-DHL CFO

Posted on by Keith McKinley

LogTech company InstaFreight has strengthened its management level by appointing Martin Leopold in the newly created position of Chief Financial Officer (CFO). Coming from industry giant DHL Freight, the 54-year-old with a mathematics degree will make sure together with the founders that scale-up InstaFreight, one of the leading digital logistics companies for overland transport in Europe, continues its dynamic growth seen in recent years.

Martin Leopold has gained substantial experience in logistics during his career – especially in the areas of finance, sales, and IT. From 2014 to 2017, he was Chief Financial Officer at Deutsche Post DHL Group. Followed by work as Chief Sales Officer at the logistics powerhouse in Bonn.

Leopold explains the motives for the change: “My decision to join InstaFreight is associated with my desire to work at a dynamically growing scale-up. Within this task the goals will be securing well-established corporate structures and creating innovative new ones. InstaFreight started with the ambition of accelerating digitalisation in European road freight transport and building a leading digital logistics provider in Europe.

“I strongly believe in InstaFreight’s vision and am very much looking forward to being part of this exciting journey. I am firmly convinced that we can develop more potential within our business model and will set out for profitability.”

“With Martin Leopold joining us, we succeed in taking another major step in our development,” says Philipp Ortwein, Managing Director and Co-Founder of InstaFreight, looking at the prospects for the company. “With his know-how and leadership skills, we at InstaFreight are striving to continue and expand the course that has made us one of the fastest-growing road freight logistics service providers in Europe.”

“InstaFreight has grown remarkably fast in recent years,” says Dirk Reich, Chairman of InstaFreight. “To maintain this momentum, we are strengthening our ranks with a manager this autumn who is highly respected in the industry. Martin Leopold will help to continue our success story together with the current management team, bringing own impulses along the way.”

 

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