RFID in warehousing

RFID in warehousing

As an efficient and effective method of tracking items and transferring data, it is not surprising that RFID (radio frequency identification) has gained prominence across several industries, though more notably within warehousing.

As demand for warehousing has increased, many businesses, globally, but specifically in the US and Canada, require services ranging from brief import housing to long-term storage of their products.

Over time and through technological advancements, businesses have required additional tools to deal with increased customer demands. Previously, barcodes were used within warehouses. These helped to tag, dock, and store stock and barcode readers were used to identify stock that came in and went out in a structured and organized manner. This worked well when single sources came in as barcode items were individually scanned one at a time. However, this was still a labor-intensive and time consuming task and required a significant amount of paperwork, tracking, and could easily lead to mistakes.

As warehouses grew in size, reaching up to many thousands of square feet of stock and storage space, the use of barcoding became less feasible. Coupled with this was also the increased competition within the sector as well as the rise of more discerning customers who demanded immediate benefits with less thought about loyalty. Businesses had to adopt to address speed, delivery/time, and cost, especially within their just-in-time inventory. Additionally, the cost of labor was also rising and was error-prone. Thus, a new and improved technology was the need of the hour.

Given this, RFID brought in a paradigm to the sector. One of its main benefits was being able to store up to “100 times the data of barcodes” and can keep track of all inventory data such as “lot and serial number, size, manufacturer, vendor, expiration date, user, location on production line, etc.”

RFID in warehousing

This is very beneficial when dealing with multiple functions such as order-picking and receiving, pick-and-pack sorting, distribution, trans-loading, promotional packing, and cross-docking.

So what is RFID? Many observers have named it the smart barcode because it is layered on top of a traditional barcode and can complete more complex functions. In essence, RFID (a form of Auto ID technology) is “a system that transmits identity in the form of a unique serial number of a product wirelessly.” Just like many other smart products such as TVs, other electronic appliances or household products, RFID tags consist of “a microchip attached to a radio antenna mounted on a substrate.” The use of this technology “connects products to the Internet for tracking purposes so that information can be shared [with businesses] across the supply chain.”

Of course, such technology can enable many varied uses and also helps to reduce time, improve real-time data accuracy, and lessen the burden on human labor involved.

Within the warehousing industry there are two types of RFID systems that are commonly used – active and passive. Passive RFID tags “do not have transmitters and simply reflect back radio waves that originate at the reader antenna,” whereas Active RFID transponders (a microchip with an antenna) “are placed on products [through which] information is accessed using a reader to pass the information to a computer.”

In terms of direct use, active RFID tags are typically used for “large assets, including cargo containers, rail cars and containers that are transported over long distances.” Passive RFID tags, are less expensive and require less maintenance though lack power sources and transmitters, ensuring their use is more limited.

The benefits of RFID within warehouses are significant. With their use, stocks can now be tagged through RFID portal readers all at once rather than individually. This is a huge bonus as it can greatly reduce time and effort and improve efficiency and accuracy, owning to the exclusion of manual processes. Further, stock can now be tracked and monitored not only within the warehouse but anywhere across the supply chain, in any location. Further, along with web tools and information about stocks, inventory can be made available in real-time and 24×7.

Another significant advantage is that RFID can be integrated with any warehouse management system that has already been deployed or is currently in use. This means there is less time and effort spent in updating or upgrading to a newer technology and limited lag-time in terms of business processes.

As mentioned earlier, RFID use also provides a much higher level of accuracy as well as an immediacy of information of inventory levels. This means that decision-making concerning replenishment of stocks can be taken with less planning and ‘on the fly’. Also, other decisions can be taken to improve the storage capacity utilization of a warehouse so as to ensure better efficiency and to improve profitability.

Due to the tracking and ‘smart’ advantage, RFIDs can help customers track and follow their goods’ journeys in real-time. Such web-based RFID systems can provide this information and help improve customer satisfaction levels. This is especially critical when precious, high-value goods are stored and being transported and can greatly help to reduce and alleviate the associated risks. Given that the monitoring process is so clear the possibility of theft can be diminished and a safer passageway of transportation could be cleared.

Finally, for both labor and cost there are clear gains given the fact that inventories can be leaner, thus, improving savings. The introduction of RFID tags can also help reduce labor costs, given that the manual work of barcode entry has been removed and humans can focus more on specialized tasks within the warehouse rather than solely on the scanning of each and every item.

As demonstrated, it is evident that RFID tags have revolutionized the warehousing sector and have pushed the associated technology further into the mainstream. Given the impetus they have provided many businesses are now looking at newer ways of using employees for more specialized tasks within warehouses, which cannot be replicated by technology. Thus, the introduction of technology within the warehousing sector is also playing a role in creating a human revolution within the workplace.

The implications of paperboard packaging replacing plastics

With an increased emphasis on being environmentally-friendly, many governments have reviewed their approach and have moved further in this direction. In the US, cities like Washington D.C (tax on plastic bags), San Francisco (complete ban on plastic bags), and Boston (tax and ban on single-use bags), have implemented their own laws. Around the world, Kenya, Chile, UK, Australia, and China have also enforced their own rules. Additionally, India enforced a ban on single-use plastics in July, 2018.

Most plastic bans include: PE bags, disposable plastic cutlery, disposable thermocol items, plastic wrap used for packaging and storage, non-woven polypropylene bags, plastic pouches for storing liquid, plastic packaging for food items, and plastic and thermocol decorations.

It has been determined that these plastics are the most harmful for the environment as they clog water bodies due to improper disposal, lead to ground water pollution, and disturb soil microbes.

With more and more countries adopting alternatives to plastic, the use of paperboard packaging has been gaining further acceptance. This has also been driven by a retail boom and the introduction and increased use of e-commerce. It is also important to note that paperboard packaging is consumer-friendly, provides excellent product protection, is lightweight, easy to transport and stack, and significantly easy to dispose of. However, the underlying and important aspect is that paperboard packaging is bio-degradable.

Given this it is no wonder that the paper packaging market is growing at a rate of 7.5%. In fact, industry estimates suggest that Amazon and Flipkart — top two players in the $17-billion ecommerce sector — consume between 1,200-1,400 tonnes of paper that goes into making boxes and printing bills.

For other large organizations such as Swedish furniture company IKEA, the switch-over to paperboard has been undertaken very quickly. And, as it is clear, the effects of paperboard packaging replacing plastics can greatly reduce climate impact, businesses are climbing on the sustainable bandwagon to underline their positive appeal for the environment.

 

 

Across the ocean, in the US, tech giant Apple has already outlined its longer-term vision in this matter. Through its October 2017 Paper and Packaging Strategy, it details how it “succeeded in reducing the plastic content of the iPhone 7 packaging by 84 per cent compared with that of the iPhone 6s.” Going forward, it is evident that this strategy is being used extensively with regard to its Apple’s smart speaker, Homepod. Here, “an incredibly complex paperboard construction with closures holds the speaker cord in place and there is also a setup to secure the plug.” And as has been mentioned, “there would be have been no doubt that plastic would have been the material of choice for this even up to 10 years ago.”

However, despite all of this, when it comes to replacing plastics there are still challenges that need to be overcome. Some of these include: the high cost of production caused by inadequate availability, the high cost of raw materials, a limited availability of good fibre, as well as technological obsolescence.

Further, major industries such as fresh and frozen foods, dairy, pharmaceuticals, beverages, snacks, and confectionery, have been severely impacted given their current extensive use of plastic packaging.

It is also evident that both the organized and unorganized sector are engaged in the packaging industry. Within the organized sector, SMEs that have been producing plastic packaging cannot quickly switch to paperboard and require time to do so. Thus, the plastic ban has adversely impacted sales and jobs in this sector. Many enterprises have also had to take up loans even though don’t have easy access to financing and funds. So despite the paper and paperboard markets growing rapidly there are still obstacles issues surrounding expansion of capacity.

Regarding the paper industry, it too has its challenges given the overall fragmentation of the market, which is served by around 500 various-sized mills. Further, the capacity for paper production has slowed down primarily due to a shortage of its key raw material – pulp wood. This is coupled with the rising prices of local waste paper. However, though this has been partially mitigated by renewed agroforestry initiatives, the industry has regularly requested for a policy to be implemented that allows access to degraded forest land for paper mills to raise pulp wood plantations for sustainable development. This, unfortunately, has yet to be undertaken.

In 2017, paper companies did not undertake price hikes due to factors such as competition from imports, stabilization in wood prices lower power, and fuel costs but by FY18, domestic paper prices had risen marginally.

In terms of supply there is a shortage of paperboard packaging and a study suggests that the paperboard segment will face a shortfall of 12.5 lac MT.

However, this supply deficit will mostly help players who are self-sufficient with raw materials and have cost optimization plans. It will also benefit major players in the industry who are using cash whilst adversely affecting the unorganized and SME sectors.

The shortfall in supply will also cause delays and disruptions in distribution and the delivery of goods produced as there is a lag for sufficient quantities of paperboard packaging material to enter the market. However, on the plus side, this may result in opportunistic price rises within paperboard packaging materials, that in turn, will raise the costs of goods overall.

It is clear that as technologies develop and more companies understand the reasons behind omitting plastics and looking towards alternatives, paperboard usage will increase. Though nations have adopted other materials at different rates and speeds, there has been a concerted effort on the part of governments, businesses, and environmental groups to push for steps to move away from plastic usage. It still remains to be seen whether current global conditions have already been too adversely effected to reverse the process but the increased move towards paperboard can only be seen as a positive sign.

Why should you use a Freight Forwarder?

Most business today have customers spread across vast geographical area even within the country, if not internationally. Hence for success of any business, it is important that the product reaches its customers unharmed, in timely manner and at a reasonable cost. If this does not happen, the business will fail, even if it has a great product.

Now imagine that a company has to ship a large package across the Atlantic Ocean (Say from the USA to some land lock country in Europe). For it, the business has to first send it to the port via truck then choose between air or sea route to cross the Atlantic. Further, it must get the product onto the ship or aircraft, (after clearing all the customs and regulatory requirements), get the delivery at the landing port across the Atlantic, clear the customs of the landing country and then again move the package by road (or another means) to the customer. For a small business, this is very daunting. This is where freight forwarders come in.

 

What is a freight forwarding business.

 

A freight forwarder is simply a business that arranges the movement of the goods for a customer from the manufacturer to the end distribution point, or to the end customer. They are the intermediary between the business and the point of delivery (end customer or distribution point). They do not move the cargo themselves; they arrange for the shipment to be picked up, transported through various modes and by different transportation providers, customs and clearing houses till it reaches the endpoint. They specialize in coordinating between various such agencies for minimum cost and speediest movement of cargo. In a way, they orchestrate between multiple service providers. They have established relationships with transporters, ocean liners and the likes, which they use to negotiate the best possible price for their clients. They use their relationship network to identify the shipping options, find the standard shipping routes and cost associated with each and select the best possible combination of available options for the shipment. All these tasks may look as formidable or complex for a simple business who just wants to get his product across, to the customer.

 

 

Services Offered by freight Forwarders

The freight forwarders generally offer a few more associated services required for the freight, which require specialized skill which may not be available with the business.

Packaging. If the cargo is going to be loaded and unloaded at several points, it needs robust packaging that can take rough handling. If the cargo is taking sea route, then the packaging must protect the cargo from sea corrosion. When shipping through air, the low air pressure and low temperatures may be a cause of concern for some of the products, and they will need sealed packaging for same. Many such specialized packaging requirements come with the transportation and other logistical options. Since freight forwarder understands the requirements and risks associated with the chosen mode of transport, they also provide (usually), the packaging that is most suitable for that mode of transport. The shipper does not have to manage additional packaging needs. This is most helpful, when there are several types of products destined for several locations with multiple modes of transportation.

 

Labeling. Cargo passing through various checkpoints usually has strict regulatory labeling requirement. Typically a cargo label would indicate following:

  •  Type and quantity of product.
  •   Handling instructions
  •   Hazardous material information
  •   Country of origin
  •   Destination
  •   Hazard and handling instructions in local language (at source and destination)

 

The freight forwarder would generally know the labeling requirements and can fulfill them more easily and precisely.

 

Documentation. Domestic and international cargo requires lot of documentation that may be daunting for a regular business. Freight forwarders have developed their expertise in knowing exactly what kind of documentation is needed for which kind of product and destination and from where and how to procure it. Some of the typical documents required for international shipping are:

  •   Bill of Landing. The contract between the shipper and the owner of the goods.
  •   Invoice. The regular commercial invoice for the product
  •   Inspection certificate. (clearance from required agency to ensure that product meets the quality as required)
  •   Insurance.
  •   Export License.
  •   Customs documents. To ensure that product can be legally sent out from the origin country and received at the destination country and is not prohibited by either of the countries.
  •   Tax papers. To ensure all the required taxes have been paid

Freight forwarders typically don’t have any capital equipment of their own. But the service they bring in can be quite valuable even for established players. They run the supply chain show, holding all the thread of various sections of the chain. The business can leave all the transportation and its related handling, packaging, documentation and other requirements to be handled by the freight forwarder and focus on what they do the best, That is making a quality product.

Use 3PL services for a growing business

More and more businesses are using third-party logistics service providers. Building an in-house supply chain is expensive, slow and a learning process riddled with mistakes. On the other hand, outsourcing the supply chain is efficient, quick and adaptable. The benefits of using 3PL are more than just reduced initial capital outflow or getting expertise. With ever-increasing competition, businesses need to focus more and more on their core activity and reduce or divert resources from non-core activities while extracting the best out of them. Managing supply chain is one such activity that can be efficiently outsourced. In fact outsourcing such non-core activity can be strategically beneficial in the long run for a business. Here are a few advantages that a growing business can get from outsourcing its logistics.

 

Scalability – Building a supply chain requires time and investment. Underutilized supply chain represents locked capital which is bad for a growing business. On the other hand, peak utilization limits the growth that operations can achieve. However, with outsourcing, the supply chain capacity can quickly increased or reduced without much impact on scale. Quick scalability is one of the biggest advantages an outsourced supply chain can offer to a growing business. Third-party providers are geared to scale their operations depending on their client’s requirements. They invest their capital in spare capacity and clients don’t need to make any capital investment. Further, if the scale of operations reduces for a client, the extra capacity is simply sold to another customer with no impact on the first client.

 

Optimization – Logistics is frequently about optimization of the resources such as packaging, transportation, route and delivery time for most efficient use of resources with minimum time. This planning and coordination requires special skills that are expensive and hard to find. Further using the skilled and costly planners only for one business may not be the cost-efficient. 3PLs bring in planning and optimization as their core skill. They plan for most optimal warehouse locations, delivery modes and routes and club cargo from multiple clients to bring the costs down. High priority deliveries are also clubbed together to bring down their costs (as compared to individual high priority delivery). This degree of optimization is difficult to achieve for a small business without significant investment and dedication of resources, which can burn quite a hole in the pocket, as the company grows.

 

Constant innovation – Supply chain requires continuous innovation in terms of packaging, equipment, processes and even transportation vehicles. For example, newer material for pallets keeps making them stronger and lighter, new methods of merchandise scanning makes tracking more efficient, more modern robots make stacking and picking of products much faster and more comfortable. Similarly, new transport vehicles (newer trucks) keep reducing the cost of transportation. The problem is that all such innovation requires an upfront investment and business cannot make any new investment until ROI from the previous investment is realized. But with higher utilization, 3PL have faster ROI cycles and can bring in capital-intensive innovation much quicker. Besides logistics being their core business, 3PLs thrive on constant innovation in supply chain to reduce costs and improve service.

 

Quick movement between supplier – While it is a good idea to maintain long relationships, business realities sometimes require to change the vendors. This need for change could be for many reasons such as better rates, larger scale of operations, wider network spread, or simply a kind of service that is not being offered by current supplier (even today many 3PL suppliers do not offer cold storage chains). As the business grows, the supply chain requirements will also change. The scale of material handling will increase. The variety of products being sold will also increase, and this will need different logistics skills. In house logistics department will need time to change and may even put up resistance to change. Improving the skill set of the whole department is not possible in a matter of few days (or even few weeks). But changing supplier is just a matter of negotiation (apart from identification of-course). The business operations are not vastly disrupted while the change of supplier happens. As is well known, changing or upgrading a department of the business is extremely slow and tiresome process, but changing a vendor is easier.

 

Lowering of Costs – Development of supply chain needs space, warehouses, packing machines, moving and stacking machines and vehicles (as large as up to trucks and lorries) making them capital intensive investments. Also, logistic operations are equally expensive, if not more. Many times, the supply chain capacity is not fully utilized leading to a high wastage of money. The 3PL absorbs the capital investment and can depreciate the equipment much faster owing to its higher utilization. The capital cycle (for supply chain) is much more efficient for 3PL as compared to in-house supply chain investment. There is no doubt that unless the volumes are huge, 3PL makes a lot more sense regarding costs and investment for any business.

Further, as the product moves through regions, various agencies or external companies come in picture. A product moving across the border will interact with customs, excise, clearance house, export regulators. Businesses need working relationships with all of them for its cargo to move quickly and efficiently through these agencies. Developing and maintaining these relationships needs resources which cost money. As business volumes grow, the interactions with agencies also increase and need more resources. A 3PL maintains these relationships for its customers so that the businesses do not have to it themselves, and they do it more efficiently.

 

Developing supply chain is a slow and costly process and often requires changes that are expensive. As the business grows, the inefficiencies of the supply chain start to glare out. The growth phase is precisely the time when companies need an efficient supply chain. An outsourced, third party supply chain will not only eliminate the inefficiencies, but it will also bring in innovation to handle the large volumes of growing business, that may provide the edge, that a growing business needs.

service provider relationship

A general logistics service provider or a specialized one- What to choose?

The number of 3PL service providers is growing rapidly. There are many small and big specialized logistics service providers for almost every specific need and then there are providers who will meet all generic requirements. The challenge is which one should you pick for your business? The one who provides every kind (or many kinds) of service or a one who offers a specific type (or just a few kinds) of service. A wrong 3PL will either fall short of the requirement or eat into the capital eroding the margins of the business. Choosing the right sort of 3PL can make or break a business. So, the question comes: How does one select the right type of 3PL provider for his company. We will run through some parameters that can be used to decide the type of 3PL that a company should hire.

 

Services required – Before selecting any 3PL provider, one must understand the services that are needed for one’s business. While it is not complicated, many new companies don’t fully understand the supply chain of their own business. They make mistakes while defining what kind of services they need for their supply chain operations. For example, the grocery startups may typically think that they will be served better with cold delivery chain (for vegetables, milk, meat and other similar products). They often overestimate the amount of cold food that needs to be delivered as part of a grocery order (for delivery- based grocery). In another kind of business, such as apparel business, ease of return of merchandise could be far more critical than other parameters. If a 3PL who specializes in delivery only (and not return pickups) is selected for such business, the logistics alone can eat into all the margins of the company. Some businesses hugely overestimate the volumes they will achieve and end up overpaying for specialized 3PL service providers (think of utilizing only 50% of the contracted capacity of cold storage chain and paying for 100% of it)

Many times, new businesses don’t really understand their customers and end up with under-utilized resources at disposal and thus decrease their capital and cost efficiency. It may be wise for new businesses to start with generalized service providers and gradually move onto specialized ones as they grow their volumes and develop better insights into their requirements.

 

Specialized expertise – Businesses today have to carve their niche to stay relevant in the market. Within groceries business, some specialize in fresh food products, while others specialize in quick delivery. In apparel, some may specialize sending multiple items and then return all except what customer wants to buy, while another may concentrate on quick delivery but with no returns. There may be yet another apparel business which may have carved a niche in ‘made to order’ clothing (this is delivered from factory to customer, directly without any warehousing). All these services need specialized 3PL skills that should be in-line with the business’s chosen specialization. One needs to ensure that the right logistics skills – as required by the business and offered by the 3PL are identified and matched to avoid any disaster.

 

Costs – If a business provides an excellent service but incurs massive costs, it may not be able to sustain. Imagine, providing a rush delivery as standard for a $10 item (which has $5 margin ) and absorbing a $5 delivery charge for it. The customers will love it, the volumes will be huge, but this kind of delivery charges will eat up all the margins. Contrary to the popular wisdom, the high volumes will kill this business. Logistics costs are of great importance to any business and must be kept under control at all times. If they cannot be passed onto the customer, they must form a small a part of expenses, as possible. Here again, there is no saying which type of 3PL will be better suited. Spending $5 on the cold delivery of $10 or $15 grocery (e.g., vegetables) may not be sensible. But if you have a truck-full of deliveries of vegetables, then the specialized cold delivery chain will be more cost efficient, and the value proposition will be higher.

 

Volumes – If a business has larger volumes, it makes sense for it go for specialized 3PL provider. With high volumes, it is possible to cut a deal with the specialized 3PL provider for getting good rates. For smaller quantities, one may want to settle with a general service provider. However, today many specialize players club the delivery from multiple vendors to increase their utilization. A new trend is emerging where multiple businesses join hands and negotiate with 3PL providers to get better value for each one of them.

 

The decision to choose a 3PL provider is never straightforward. Multiple factors need to be borne in mind before making a choice. As a general rule of thumb, it is recommended that one should start with general provider and move to the specialized one as the business grows and there is clarity of requirements.

A key advantages of choosing a general service provider from the start is that as the business grows, the service provider’s volumes also grow and he will make investment specifically for your growing needs. This, in turn, makes him specialized provider for your requirements. In fact, he would develop services for your specific needs making it a strategic fit for your business.

co-packers

Top benefits of working with a Co-Packer

Industries usually deploy co-packers for outsourcing some of the more intricate secondary packaging needs; thereby making the commodities shelf-ready. Lately, this concept has attracted a lot of attention courtesy its massive presence in the food and pharmaceutical market. While it easily improves the operational efficiency, there are a host of other benefits that come along with a co-packing service.

However, before enlisting the benefits associated with a co-packing service, it is important to visualize the impact of a contract manufacturer when it comes to handling the product aesthetics and customer satisfaction levels. We all know that companies emphasize massively on the manufacturing process but it’s the packaging that helps spread the word. This critical marketing component, therefore, needs to be prioritized by bringing certain reliable contract manufacturers into the mix. That said, majority of SMEs are constantly vouching for efficient co-packers, in order to gain a competitive advantage.

1.      Greater Flexibility

There are several food and pharmaceutical businesses that are restricted in terms of infrastructure and therefore fail to experiment with diverse packaging options. Co-packers offer them flexibility as they can easily outsource these services; thereby leveraging a host of innovation packaging techniques. While it allows businesses to work without having a dedicated packaging arena, it also helps them save a lot of money. Lastly, improved flexibility also helps boost company credibility and product image.

2.      Greater Profits

Taking care of the packaging requirements is quite a tricky job. However, businesses need not worry about the same as a contract manufacturer can easily handle the more intricate aspects of secondary and even primary packaging. Be it involving qualified staff for doing the job or facilitating the inclusion of high-end production facilities— an efficient co-packer can handle each aspect without putting undue stress on the concerned business frameworks. With majority of business verticals handled in the best possible manner, the company starts making a lot of profits while saving on a lot of investment— all at once.

3.      Best-seasonal Packaging Options

The concept of seasonal packaging is surely investment intensive. However, if done right, seasonal packaging can be extremely cost-effective in the long run and this is where contract manufacturers pitch in. Co-packers handle these aspects of packaging by taking care of short-term necessities.

4.      Quicker Organizational Output

The entire process of manufacturing thrives on the quickest possible output and this is what co-packing services usually boast of. With the products manufactured at a steady pace, it becomes important to pack and send them out, at the earliest. Companies that have a contract manufacturer to work with can roll out supplies faster than some of the contemporaries, which in turn help improve customer satisfaction levels.

5.      Lesser Manpower Requirement

Once a company starts outsourcing co-packing requirements, the existing workforce automatically gets downsized. This, eventually, lowers the existing costs pertaining to the upgraded machinery, maintenance and even employee training. Once in-house facilities are eliminated and the packaging requirements are outsourced, it becomes easier for the companies to concentrate on the process of manufacturing. This actually improves overall efficiency and helps minimize the associated clutter.

6.      Optimized Processes

Not just the packaging processes, a co-packer can also help improve the manufacturing whereabouts by offering services like contract sewing, bar coding and thermoforming. Once these attributes are included within the scheme of things, it becomes easier for companies to optimize certain intricate manufacturing processes. Apart from that, businesses can also fine-tune the existing manufacturing processes with the more complex ones taken care of.

7.      Sustainable Prospects

Majority of manufacturing, packing and rendering services need a sustainable environment to thrive. With Co-packers at the helm, food and other SMEs can easily inculcate sustainable approaches into the mix while also giving attention to profitability. However, there are companies which install their own packaging firms; thereby putting a lot of undue pressure on the existing processes. A co-packer can therefore render sustainability and extremely user-friendly solutions to the businesses without burdening them with financial stress.

Most of the co-packing companies offer customized solutions to the businesses which typically concentrate on consumer packaged goods and other forms of food packaging. Contract manufacturers or rather contract packagers specialize in these aspects and they skillfully handle most of the concerned requirements while taking care of the labor and even automated machines.

Why Co-Packing Services are Necessary for Food Businesses?

Companies that are looking to grow their brand must immediately consider a co-packer. While this approach holds true for every other business, food-specific industries are best served with a co-packer added into the scheme of things. While certain companies prefer outsourcing the manufacturing part, it is important that a contract manufacturer is deployed, in order to speed up assimilation, packing and fulfillment. However, every service provider isn’t functional enough and it takes quite a lot of intuition when it comes to zeroing in on the perfect co-packer for the concerned business. In a nutshell, any food business can easily scale up with a co-packer at the helm as some of the more intricate aspects of packaging are then handled with precision and accuracy.

In the subsequent sections we shall look at the flowchart that helps companies deploy efficient co-packers. Moreover, it is true that every food-specific business needs to work with one, in order to improve scalability and efficiency.

 

When do Companies Usually Deploy Co-Workers?

According to proven surveys, almost one-third of global manufacturers offer outsourced services where they render co-packing benefits to certain esteemed firms. Almost 45 percent of the manufacturers that lack a dedicated unit help other food-specific companies co-pack certain products; thereby assisting producers improve the line extensions. Moreover, a food producer typically hires a co-packer when it moves towards additional certifications, large-scale productions and newer products. Therefore, it can be established that every food producer needs to look up to a co-packer during its business lifecycle.

Understanding the Requirements

The first aspect of hiring a co-packer is to ascertain the industrial requirements, beforehand. Companies that have outgrown their in-house production often need to outsource the packaging and fulfillment services. Majority of food startups start off by producing items in smaller batches. However, upon growing constantly, it becomes hard for them to manage services and the fulfillment requirements, simultaneously. Outsourcing the production, manufacturing and even packaging should therefore be the norm for the constantly growing SMEs.

It must be understood that investing in expansive production techniques and facilities require additional costs and certifications. Moreover, with the ever-expanding clientele expecting improved services, it becomes important to deploy a co-packer that can save a lot of time and effort. This, in turn, allows the business to concentrate more on the kitchen and the concerned production facility while the co-packers take care of the distant metrics.

Learning the Process

One aspect of hiring a co-packer is to gain a better understanding of the recipe, concerned processes and industrial equipment. Being proactive is what separates great businesses from the average ones. However, staying proactive requires the authorities to remain present for the first few lots while making a detailed list of the necessary ingredients. While the co-packing requirements are necessary to cover, food businesses must also check the complexity and availability of the required products before letting the co-packer pick stuffs. Apart from that, businesses must also keep a close eye on the packaging, in order to fulfill the consumer requirements and usability factor.

Ascertaining the Business Volume

Businesses with high production volume should look to deploy the services of a co-parker as the latter thrives when there is a lot to work with. Well-established co-packers need to be convinced about the potential of a food business before they start working with the same. However, validation works both ways as even the concerned SMEs must check the equipment set pertaining to the contract manufacturer and see if it is compatible with the production requirements. In addition to that, the timeline and projection of the business must be matched with the production requirements, well in advance.

Trusting the Gut

Food businesses should trust their gut while hiring co-packers for the job. With the outsourced contract manufacturers specializing in select areas, it becomes hard for the SMEs to select the suitable vendor for shouldering responsibilities. While a proactive and intuitive approach can help, at the end it all boils down to the gut feeling.

Working with co-packers and contract manufacturers can get tricky at times but food companies with a clear vision can easily integrate services as they understand the entire production process and even follow instincts when it comes to preparing food items, selecting ingredients and handling the packaging requirements.

7 Ideas to Amplify Workforce Efficiency Levels for a Warehouse

Maximizing warehouse efficiency improves organizational profitability and enterprises are slowly but steadily realizing the same. However, it isn’t easy to immediately improve the efficiency levels of the concerned workforce and it takes quite a lot of effort to ensure that the warehouses are functioning at the most optimized levels. Moreover, managers placed at the distribution centers can easily gauge the fact that every warehouse process isn’t executed optimally courtesy lack of proper planning, strategy allocation and resources. Therefore, it is important to improve the overall efficiency of the existing warehouse by putting certain intuitive approaches to use.

Prioritize Log Processing

One aspect of improving warehouse workforce efficiency is to concentrate more on log processing by prioritizing inventory tracking and other documented approaches. Companies that can keep a track of the error rates and other insights are best placed when it comes to improving productivity. Tabulating changes in training procedures, adopting newer technologies and including new workers are some of the strategies which can effortlessly optimize the existing workforce efficiency levels. Log processing, therefore, allows companies to adopt and analyze the ramifications from a proactive point of view while gaining important insights regarding the existing loopholes.

Reinforce Accountability

There are times when automation within the warehouse leads to certain errors in packing, picking and fulfillment. Although, automation as a strategy cannot be ignored, warehouse efficiency can only be improved if the companies hold the workers accountable for the mistakes. Reinforcing warehouse accountability readily emphasizes on accuracy and helps the industries fix and avoid errors in the long run.

Stress on Proper Communication

It is important for the companies and warehouse managers to communicate strategically with the workers, in order to keep them invested in the cause. Be it communicating regarding productivity or supply chain processes, one way of improving warehouse efficiency is to create a sense of understanding between the management and warehouse employees. This approach accentuates the efficacy of problem solving by building a unified bridge of understanding.

Empower the Workforce

Although we did mention a few strategies for improving the workforce efficiency, empowering the same is one option that can pay rich dividends. This strategy implies at focusing on the core skills of the individuals while exhibiting confidence on their potency. Empowering the workforce with special technologies and undeterred confidence is one way of keeping the employees interested.

Develop Procedures and Standards

Reducing errors is important when it comes to improving the efficiency of the warehouse workforce. One way of achieving perfection is to create a pre-defined procedural module pertaining to the developmental standards. Warehouse managers should focus on reducing probable variations while concentrating more of the aspects of shipping, shift scheduling and quality control. Moreover, it is important to focus on the facilities management; thereby increasing collective productivity and improving warehouse efficiency.

Adopt Process Improvement as a Continual Strategy

Warehouse managers must opt for continual process improvement as it allows them to initiate similar processes via diverse techniques. This way, warehouses can zero in on the best strategy for a particular job that can help them save money, effort and time. That said, an approach like this allows companies to evaluate the existing procedures while adopting necessary changes. Be it looking at the inventory management process or the staffing requirements, process improvement is something that can amplify productivity and help an organization identify the necessary areas that require attention.

Outsource Services

In addition to every other trick in the book, companies can opt for outsourcing certain warehouse processes for gaining an advantage. There are certain aspects of warehousing that require additional levels of intuition and hiring a 3PL service provider can come in handy for the enterprises. This flexibility allows companies to design, implement, and manage specific warehouse activities without having to worry about additional tasks.

Inference

Warehouse workforce efficiency can be a limiting factor when it comes to the growth and profitability of an organization. Therefore, companies must be vigilant about the same and should look to implement the mentioned strategies for gaining an edge over the competitors. However, there are many who believe that investing in new technological ideas can easily improve workforce efficiency. While technology can be one of the precursors, it’s definitely not the only requirement. Evaluating the existing warehouse practices and fine-tuning them should be the primary concerns for the companies when it comes to amplifying workforce efficiency levels.

How to Shape up the Future of Trucking?

Although the transportation industry has evolved, trucks continue to play a major role in carrying and delivering freight from one point to another. That said, the emphasis has always been on taking the pressure off the trucks, in order to conserve fuel, maximize overall capacity and even reduce the underlining costs. Even then, the trends have largely been in favor of truckload transportation with these vehicles accounting for almost 81 percent of the entire expenditure module. With truckload transportation and trucking continuing to rule the roost, we actually need to look at what future holds for this industry, regardless of the booming changes. 2018 is already upon us and it’s time we embrace the new changes which are expected to stay with us for the next few years.

Recruiting a more Functional Set of Drivers

Until the trucks start plying by themselves, we would be requiring drivers. However, quite recently the transportation industry has started seeing a dearth of efficient drivers which in turn is raising some important questions. The future of truckload transportation will see the companies’ focus more on exceptional driving skills, especially for the long-hauls. Needless to say, truck drivers will be the limiting factors in the long term and the lack of skills might minimize the overall growth of trucking capacity. Moreover, once the driver conundrum is taken care of, it would be easier for the companies to increase the freight volume at a steady pace.

Growth of Dedicated Trucking Services

In the next few years, industries will witness a massive growth in the adoption of dedicated trucking services. This would involve acceptance towards a host of macro factors including the likes of capacity tightening and dedicated operations. Moreover, this approach will guarantee that customers get the exact product they have signed up for. The companies are eventually realizing the fact that customers are always on the lookout for cost-effective deliveries and that too within a reasonable period of time. Over a period of time, truckload transportation will start concentrating on the same by securing prices and the underlining capacities.

Improved Capacities

Shipping containers which are half-full can lead to higher transportation costs; thereby accentuating worries for the concerned businesses. The future of truckload transportation will make sure that containers are shipped at full capacity by using sophisticated methodologies, higher load efficiencies and cross-docking techniques. Some of the other intuitive strategies include minimizing certain one-way routes and even deploying experienced third-party logistics.

Relying on Technology

Although businesses are already concentrating on technology, it is only a matter of time that supply chains and logistics managers make it their first line of defense. Be it gauging the uncertainties of economy and workforce, technology-driven ideologies and concepts are expected to last way more than the usual ones. Moreover, truckload transportation will see continued adoption of different supply chain technologies, inventory management approaches, consolidated route tracking systems and driver tracking options courtesy the growth of technology. Each one of these techniques can help improve driver safety, performance and even fuel efficiency.

Reliance on 3PL Vendors

Truckload transportation is expected to thrive only if the companies start shifting excess baggage to trusted 3PL services. That said, outsourcing certain tasks can easily increase the overall efficiency as businesses can then concentrate more on productivity and accountability. In addition to that, partnering with certain functional 3PL companies allows businesses to express themselves in a much better way as the former eliminates additional costs and also helps deliver the goods in an efficient manner. Moreover, the 3PL service providers render additional levels of safety to the fleets and concerned commodities.

Inference

The future of truckload transportation will be dictated by how well the organizations make use of the resources in hand. While keeping up with the industrial requirements is a prerequisite, it automatically boils down to how companies express themselves in terms of logistics and fulfillment. At the end, it’s all about delivering the products efficiently to the customers while minimizing overhead costs, associated intricacies and product damages. Needless to say, the quality of drivers and fleet with determine the fate of trucking and truckload transportation and 3PL services will surely play an important role in shaping up the same. Be it outsourcing select services pertaining to transportation or adopting the best technologies for the job, future of trucking will thrive on a proactive approach.

Inventory Management

How SME’s can improve their Inventory Management Process ?

Majority of small and medium sized businesses dealing with warehousing, retail, manufacturing and distribution often come across inventory specific challenges. Be it issues related to dead stock or struggles with wastage’s and stock losses— lack of a functional inventory management process can seriously impair productivity and restrict growth. Moreover with massive levels of investments manipulating the inventory, it becomes essential for the businesses to treat stocks with respect.

In the subsequent sections, we shall look at some of the most functional inventory management strategies, adopted by the SMEs.

Making Use of Optimization Tools

SMEs are best served by inventory optimization tools that focus on specifics and help them gain a competitive advantage over the competitors. These tools help marketers and warehouse managers evaluate the concerned networks for the best policies and even the existing inadequacies. Each supply chain node is closely analyzed by the standalone tools which extract data from ERP and WMS systems. In a nutshell, these optimization tools analyze supply variability, demand variability, and certain replenishment parameters for staying ahead of the market and industry loopholes. SMEs are increasingly investing in these tools for carving out a pretty intuitive inventory management process.

Employing Real-Time Analytics and Business Solutions

Majority of SMEs are increasingly focusing on real-time analytics for managing the inventory in a better way. With technological innovations at the fore, it is quite easier for them to create a unified information model that comprises of financial data, supply chain insights and other granular information sets. Having a cohesive platform for employing varied business solutions is a great strategy that SMEs are increasingly focusing on.

Treating Stock like Finances

Companies that treat stock like finances never have to compromise on productivity and growth. Moreover, it is only appropriate to render similar levels of importance to the stocks as they are the organizational assets, precisely in the form of inventory. SMEs must keep a detailed track of the commodities by analyzing the inflow, outflow, stock movement and the price points. Businesses that have good understanding of the stock often fare better as compared to others as they usually avoid making additional orders and swear by smarter inventory-specific decisions.

Adopting Automation

Automation is probably the only solution that can easily streamline the existing inventory management requirements. Moreover, SMEs opting for this strategy need not depend on manual interventions. Be it placing replenishing orders for stocking or even following up the deliveries, automation allows businesses to stay ahead in terms of innovation. With automation on-board, it becomes easier for companies to detect excess and dead stock while addressing issues related to supply and demand.

Improving Functionality

Small and medium sized businesses should look to improve the functionality of the concerned warehouse for addressing the inventory specific requirements. The most probable solutions include staff access and updated inventory. Moreover, businesses must also look to integrate the existing inventory systems with a POS system; precisely for staying updated and minimizing the lag time. That said, improved functionality also leads to advanced reporting where SMEs can easily gather new insights, depending on performance and inventory management. Some of the other benefits associated with improved functionality include customizable workflows.

Monitoring Slow or Dead Stock

While we did talk previously about the dead stock, it’s high time we address the elephant in the room. Firstly, a dead stock takes up quite a lot of space and hinders functional additions. SMEs should be able to tabulate the stocks based on the dynamism and must try to get rid of the stagnant ones, at first. Slow moving stocks limit profitability by restricting cash flow. Lastly, businesses must segregate the stocks and commodities within the warehouses based on their shelf life. Once the stagnated stocks are liquidated, it becomes easier for the companies to control the deadstock levels, make new additions and improve productivity.

Inference

These are some of the most functional strategies which can be deployed by small and medium sized businesses for improving the existing inventory management framework. Apart from the mentioned ones, companies should also be able to added newer technologies into the mix for improving the entire process of inventory management. Last but not the least; SMEs should emphasize on amplifying the workforce efficiency within the warehouse for handing the inventory in the best possible manner.